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Item 7. Management’s Discussion and Analysis

2026-05-28 compared with 2025-05-29 · 343 added, 368 removed, 650 unchanged (52% of the section changed)

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

NGL Energy Partners LP, a Delaware master limited partnership (“we,” “us,” “our,” or the “Partnership”), is a diversified midstream energy partnership that transports, treats, recycles and disposes of produced and flowback water generated as part of the energy production process as well as transports, stores, markets and provides other logistics services for crude oil and liquid hydrocarbons.

NGL Energy Partners LP is a Delaware master limited partnership (“we,” “us,” “our,” or the “Partnership”).

NGL Energy Holdings LLC serves as our general partner (“GP”).

At March 31, 2026, our operations included three segments as discussed below.

Sale of Refined Products Business and Exiting Biodiesel Business

As of March 31, 2025, we completed winding down our biodiesel business (see Note 1 to our consolidated financial statements included in this Annual Report for a further discussion).

On March 17, 2025, we signed a purchase and sale agreement to sell our refined products business, including certain working capital items, to a third-party (see Note 1 to our consolidated financial statements included in this Annual Report for a further discussion).

This sale closed on April 30, 2025.

The sale of our refined products business and winding down of our biodiesel business represent a strategic shift in our operations and will have a significant effect on our operations and financial results going forward.

Accordingly, the results of operations and cash flows for our refined products and biodiesel businesses within our Liquids Logistics segment have been classified as discontinued operations for all periods presented and prior periods have been retrospectively adjusted in the consolidated statements of operations and consolidated statements of cash flows (see Note 18 to our consolidated financial statements included in this Annual Report for a further discussion).

Sale of Certain Natural Gas Liquids Terminals and Most of Our Wholesale Propane Business

On February 5, 2025, we signed a purchase and sale agreement to sell 17 of our natural gas liquids terminals, most of our wholesale propane business, our interest in an unconsolidated entity and working capital to a third-party (see Note 1 to our consolidated financial statements included in this Annual Report for a further discussion).

This sale closed on April 30, 2025.

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.

Water Solutions

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.

We also sell produced water for reuse and recycle 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.

We also dispose of solids such as tank bottoms, drilling fluids and drilling muds and perform other ancillary services such as truck and frac tank washouts.

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

We also dispose of solids such as tank bottoms, drilling fluids and drilling muds and perform other ancillary services such as truck washouts.

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

We operate in a number of the most prolific crude oil and natural gas producing areas in the United States including the Delaware Basin in New Mexico and Texas, the Denver-Julesburg (“DJ”) Basin in Colorado and the Eagle Ford Basin in Texas.

With a system that handled approximately 958.3 million barrels of produced water across its areas of operation during the year ended March 31, 2025, we believe that we are the largest independent produced water transportation and disposal company in the United States.

With a system that handled approximately 1.063 billion barrels of produced water across its areas of operation during the year ended March 31, 2026, we believe that we are the largest independent produced water transportation and disposal company in the United States.

The opportunity to generate revenue in our Water Solutions segment is driven in large part by the level of crude oil production in the areas where our facilities are located.

Recently, our disposal volumes have been positively impacted by the increase in the level of crude oil production, particularly in the Delaware and Eagle Ford Basins, due to stable crude oil prices.

Recently, our disposal volumes have been positively impacted by the increase in the level of crude oil production, particularly in the Delaware and DJ Basins, due to higher crude oil prices.

Lower crude oil prices provide producers with less incentive to drill and complete new wells, which results in lower production and negatively impacts our disposal volumes.

Our Water Solutions segment generated operating income of $311.5 million during the year ended March 31, 2025, compared to operating income of $231.3 million during the year ended March 31, 2024.

Seismic Activity

The subsurface injection of produced water for disposal has been associated with induced seismic events in Texas and New Mexico.

While these events have been of relatively low magnitude, industry and relevant state regulators are, nevertheless, taking proactive measures to attempt to prevent similar induced seismic events.

More specifically, we are engaged in various collaborative industry efforts with other disposal operators and relevant state regulatory agencies, working to collect and review data, enhance understanding of regional fault systems, and ultimately develop and implement appropriate longer-term mitigation strategies.

As part of this effort, we have implemented reductions in injected volumes at certain facilities, and where appropriate have temporarily shut-in facilities.

To date, due to the capacity of our integrated system in the affected areas, the diverse locations of our disposal facilities, and the connectivity of our system, our ability to dispose of produced water has not been materially impacted by these actions, and with our unique positioning outside of the affected areas, we have the ability to grow our asset base.

Crude Oil Logistics

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We believe volatility in commodity prices will continue, and our ability to adjust to and manage this volatility may impact our financial results.

Our Crude Oil Logistics segment generated operating income of $46.1 million during the year ended March 31, 2025, compared to operating income of $52.1 million during the year ended March 31, 2024.

Liquids Logistics

Our Liquids Logistics segment conducts supply operations for natural gas liquids to commercial, retail and industrial customers across the United States and Canada.

These operations are conducted through our five owned terminals, third-party storage and terminal facilities, nine common carrier pipelines and a fleet of leased railcars (updated for the transactions discussed above).

These operations are conducted through our five owned terminals, third-party storage and terminal facilities, access to 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 we also own a propane pipeline in Michigan.

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We believe volatility in commodity prices will continue, and our ability to adjust to and manage this volatility may impact our financial results.

Our Liquids Logistics segment generated operating income of $14.1 million during the year ended March 31, 2025, compared to an operating loss of $13.2 million during the year ended March 31, 2024.

Recent Developments

Debt Refinancing

On March 12 , 2026, we closed a debt refinancing transaction of $950.0 million consisting of a new seven-year senior secured 2026 term loan “B” credit facility (“2026 Term Loan B”).

In connection with the closing of the debt refinancing transaction, our asset-based revolving credit facility (“ABL Facility”) was amended to reduce our total commitments and to make other changes to the terms thereof.

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

Discontinued Operations

Sale of Refined Products Business and Exiting Biodiesel Business

As of March 31, 2025, we completed winding down our biodiesel business (see Note 17 to our consolidated financial statements included in this Annual Report on Form 10-K (“Annual Report”) for a further discussion).

On April 30, 2025, we sold our refined products business, including certain working capital items, to a third-party (see Note 17 to our consolidated financial statements included in this Annual Report for a further discussion).

Other Dispositions

Sale of Certain Investments in Unconsolidated Entities and Related Assets

On April 14, 2025, we sold certain investments in unconsolidated entities, property, plant and equipment and intangible assets to a third-party (see Note 17 to our consolidated financial statements included in this Annual Report for a further discussion).

Sale of Certain Natural Gas Liquids Terminals and Most of Our Wholesale Propane Business

On April 30, 2025, we sold most of our wholesale propane business, 17 of our natural gas liquids terminals, our interest in an unconsolidated entity and working capital (“Wholesale Propane Disposition”) to a third-party (see Note 17 to our consolidated financial statements included in this Annual Report for a further discussion).

Sale of Certain Railcars

During the year ended March 31, 2026, we sold the remaining 203 railcars of our Crude Oil Logistics segment (see Note 17 to our consolidated financial statements included in this Annual Report for a further discussion).

Disposition transactions impact the comparability of our results of operations between our current and prior fiscal years.

See Note 1 and Note 17 to our consolidated financial statements included in this Annual Report for a discussion of dispositions that occurred during the current and prior fiscal years.

Consolidated Results of Operations

How We Evaluate Our Operations

We use a variety of financial and operating metrics to analyze our performance.

Our consolidated financial metrics include operating income, income from continuing operations and Adjusted EBITDA.

We evaluate segment operating results

using operating income, Adjusted EBITDA and our operating metrics, which include various volume and rate statistics that are relevant for the respective segment.

These operating metrics allow investors to analyze the various components of segment financial results in terms of volumes and rate/price.

We use these metrics to analyze historical segment financial results and as the key inputs for forecasting and budgeting segment financial results.

For additional information on our operating metrics, see the respective segment discussions below.

The following table summarizes our consolidated statements of operations for the periods indicated:

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Interest expense (257,490) (280,078) (269,804)

(Loss) gain on early extinguishment of liabilities, net — (55,281) 6,177

Loss on early extinguishment of liabilities, net (16,749) — (55,281)

Other income, net 526 4,262 2,782

Income (loss) from continuing operations before income taxes 60,104 (156,270) 9,254

(Loss) income from continuing operations before income taxes (178,779) 60,104 (156,270)

Income tax benefit (expense) 276 4,885 (1,458)

Income (loss) from continuing operations 64,989 (157,728) 9,035

(Loss) income from discontinued operations, net of tax (21,826) 14,604 43,457

Net income (loss) 43,163 (143,124) 52,492

(Loss) income from continuing operations (178,503) 64,989 (157,728)

Income (loss) from discontinued operations, net of tax 39,340 (21,826) 14,604

Net (loss) income (139,163) 43,163 (143,124)

Net income from continuing operations attributable to nonredeemable noncontrolling interests (3,376) (3,749) (631)

Net income from continuing operations attributable to redeemable noncontrolling interests (46) — —

Net income (loss) attributable to NGL Energy Partners LP $ 39,368 $ (143,755) $ 51,386

Items Impacting the Comparability of Our Financial Results

Our current and future results of operations may not be comparable to our historical results of operations for the periods presented due to commodity price volatility, demand fluctuations, acquisitions, dispositions and other transactions.

Recent Developments

Disposition transactions impact the comparability of our results of operations between our current and prior fiscal years.

See Note 1 and Note 17 to our consolidated financial statements included in this Annual Report for a discussion of dispositions that occurred during the current and prior fiscal years.

Other Developments

Seismic Activity

The subsurface injection of produced water for disposal has been associated with induced seismic events in Texas and New Mexico.

While these events have been of relatively low magnitude, industry and relevant state regulators are, nevertheless, taking proactive measures to attempt to prevent similar induced seismic events.

As part of this effort, we have implemented reductions in injected volumes at certain facilities, and where appropriate have temporarily shut-in facilities.

Net loss (income) from continuing operations attributable to redeemable noncontrolling interests 244 (46) —

Net (loss) income attributable to NGL Energy Partners LP $ (142,295) $ 39,368 $ (143,755)

Adjusted EBITDA - Continuing Operations (1) $ 660,203 $ 622,892 $ 593,414

(1) See Adjusted EBITDA definition and reconciliation in “Non-GAAP Financial Measures” section below.

Changes in commodity prices and sales volumes affect both revenues and cost of sales in our consolidated statements of operations and, therefore, the impact is largely offset between these line items.

Operating income decreased $234.6 million for the year ended March 31, 2026, compared with the same period in 2025, primarily as a result of the following:

• Water Solutions – an increase of $23.9 million due primarily to higher water disposal revenues from an increase in produced water volumes processed and higher pipeline revenues, partially offset by higher derivative losses and increased expenses, mainly due to the revaluation of liabilities and losses on disposal or impairment of assets;

• Crude Oil Logistics – a decrease of $273.0 million due primarily to a goodwill impairment charge, lower pipeline revenue, higher derivative losses and increased expenses due to a loss on the sale of assets, partially offset by increased revenues and volumes from higher production on acreage dedicated to us;

• Liquids Logistics – an increase of $34.2 million due primarily to lower expenses related to the Wholesale Propane Disposition, including a gain on the sale, partially offset by lower product margins for propane, due to the Wholesale Propane Disposition and butane, due to a weak blending market;

• Corporate and Other – a decrease of $19.7 million due to increased equity-based compensation expense, increased legal expenses and lower overhead allocations.

In addition to the items discussed above, there was a loss (inclusive of debt issuance costs written off) related to the early termination of the seven-year senior secured 2024 term loan “B” credit facility (“2024 Term Loan B”), a lower income tax

benefit (see Note 2 to our consolidated financial statements included in this Annual Report), lower equity in earnings of unconsolidated entities as we sold our equity method investments during the year ended March 31, 2026 and a loss from a legal dispute.

These decreases were partially offset by lower interest expense (as discussed below) and gains on marketable securities.

Operating income increased $167.4 million for the year ended March 31, 2025, compared with the same period in 2024, primarily as a result of the following:

• Water Solutions – an increase of $80.2 million due primarily to higher water disposal revenues from an increase in produced water volumes processed and lower losses on disposal or impairment of assets;

• Crude Oil Logistics – a decrease of $6.0 million due primarily to lower sales volumes due to lower production on acreage dedicated to us and lower crude oil prices, partially offset by higher tariff revenue on the Grand Mesa Pipeline, decreased depreciation expense and higher derivative gains;

• Liquids Logistics – an increase of $27.2 million due primarily to lower expenses from the impairment of goodwill in fiscal year 2024, partially offset by higher derivative losses and lower product volumes;

• Corporate and Other – an increase of $66.0 million due primarily to increased legal expenses in fiscal year 2024 from an increase in our accrual related to the LCT Capital, LLC (“LCT”) legal matter.

In addition to the items discussed above, there was a loss on early extinguishment of liabilities, net during the year ended March 31, 2024 due to a call premium paid for the early extinguishment of the outstanding 7.5% senior secured notes due 2026 (“2026 Senior Secured Notes”), the write-off of debt issuance costs and other expenses related to the repurchase/redemption of the 2026 Senior Secured Notes and Senior Unsecured Notes (as defined herein) and a higher income tax benefit (see Note 2 to our consolidated financial statements included in this Annual Report), partially offset by higher interest expense (as discussed below).

Seasonality impacts our Liquids Logistics segment.

Consequently, for our Liquids Logistics segment, revenues, operating profits and operating cash flows are generated mostly in the third and fourth quarters of our fiscal year.

We generally borrow under our asset-based revolving credit facility (“ABL Facility”) to supplement our operating cash flows during the periods in which we are building inventory (see “–Liquidity, Sources of Capital and Capital Resource Activities–General”).

We generally borrow under the ABL Facility to supplement our operating cash flows during the periods in which we are building inventory (see “–Liquidity, Sources of Capital and Capital Resource Activities–General”).

Subsequent Events

See Note 20 to our consolidated financial statements included in this Annual Report for a discussion of transactions that occurred subsequent to March 31, 2025.

Water Disposal Agreement with Minimum Volume Commitment and Extension of Acreage Dedication

On May 7, 2026, we announced a further expansion of our Lea County Express Pipeline System (“LEX II Expansion”) to increase capacity by 165,000 barrels of water per day with a capability to transport approximately 560,000 barrels of water per day on the LEX II system.

The LEX II Expansion is un derwritten by a newly executed long-term volume commitment contract that includes increased volume commitments, and an additional four township committed area in Eddy County, New Mexico .

Additionally, the LEX II Expansion is expandable up to 650,000 barrels of water per day.

Segment Operating Results for the Years Ended March 31, 2026 and 2025

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Cost of sales-excluding impact of derivatives 6,499 7,848 (1,349)

Derivative (gain) loss (5,001) 1,148 (6,149)

Cost of sales-derivative loss-unrealized 21,573 4,953 16,620

Cost of sales-derivative loss (gain)-realized 2,633 (9,954) 12,587

Operating expenses 222,142 214,928 7,214

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Segment operating income $ 335,366 $ 311,457 $ 23,909

Adjusted EBITDA - Continuing Operations (3) $ 602,726 $ 541,996 $ 60,730

Produced water processed (barrels per day)

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DJ Basin 177,963 146,956 31,007

Other Basins — 740 (740)

Total 2,912,918 2,625,349 287,569

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Operating expenses for produced water processed ($/barrel) (4) $ 0.21 $ 0.22 $ (0.01)

(1) As of March 31, 2023, approximately 34,380 barrels of skim oil were stored and were sold during the year ended March 31, 2024.

(1) Water disposal service fees and Other revenues in the table above differ from the amounts reported in Note 11 to our consolidated financial statements included in this Annual Report, as the amounts in Note 11 are disaggregated by the performance obligations with type of contract and service provided and the timing of the transfer of goods and services, while the amount above is presented based on how management reviews performance.

In the table above, revenues from reimbursements from construction projects, booster operating fees and generator rentals and pipeline revenue are included in Other revenues, while in Note 11 the amounts are included in Water disposal service fees.

(2) Recycled water in the table above differs from the amount of Sale of Water reported in Note 11 to our consolidated financial statements included in this Annual Report, as the amounts in Note 11 are disaggregated by the performance obligations with type of contract and service provided and the timing of the transfer of goods and services, while the amount above is presented based on how management reviews performance.

In Note 11, Sale of Water includes the sale of produced water, recycled water and brackish non-potable water, which in the table above, brackish non-potable water is included in Other revenues.

(3) See Adjusted EBITDA definition and reconciliation in “Non-GAAP Financial Measures” section below.

(4) Total produced water barrels processed during the years ended March 31, 2026 and 2025 were 1,063,215,067 and 958,252,275, respectively.

These amounts do not include 49,861,950 barrels and 63,968,944 barrels for the years ended March 31, 2025 and 2024, respectively, related to payments made by certain producers for committed volumes not delivered, as discussed further below.

In addition, water pipeline revenue, which is included in Other Revenues, includes payments from a producer for 19,257,873 committed barrels not delivered during the year ended March 31, 2025.

(3) Excluding payments made by certain producers for committed volumes not delivered and the one-time item discussed below, service fees for produced water processed ($/barrel) would have been $0.60/barrel and $0.61/barrel during the years ended March 31, 2025 and 2024, respectively.

These amounts do not include 47,514,240 barrels and 49,861,950 barrels for the years ended March 31, 2026 and 2025, respectively, related to payments made by certain producers for committed volumes not delivered.

In addition, water pipeline revenue, which is included in Other revenues, includes payments from a producer for 23,144,533 and 19,257,873 committed barrels not delivered during the years ended March 31, 2026 and 2025 , respectively.

(5) Excluding payments made by certain producers for committed volumes not delivered, service fees for produced water processed ($/barrel) would have been $0.60/barrel and $0.60/barrel during the years ended March 31, 2026 and 2025, respectively.

Water Disposal Service Fee Revenues.

The increase was due primarily to an increase in produced water volumes processed from contracted customers and higher fees charged for interruptible spot volumes.

These increases were partially offset by the expiration of certain higher fee per barrel contracts which were replaced with lower fee per barrel contracts with an extended term and higher volumes received under contracts with lower fees per barrel.

There was also a decrease in payments made by certain producers for committed volumes not delivered.

In addition, during July 2023, we entered into a transaction in which a portion of the total consideration received was allocated to revenue due to the termination of a minimum volume water disposal contract (see Note 17 to our consolidated financial statements included in this Annual Report).

The increase was due primarily to an increase in produced water volumes processed from contracted customers.

Recovered Crude Oil Revenues.

The increase was due primarily to an increase in skim oil barrels sold due to more skim oil recovered from receiving more water in higher oil cut basins, partially offset by lower realized crude oil prices received from the sale of skim oil barrels.

Also, during the year ended March 31, 2024, we sold approximately 34,380 barrels of skim oil that were stored as of March 31, 2023 due to tighter pipeline specifications.

The increase was due primarily to an increase in skim oil barrels sold due to more skim oil recovered from receiving more produced water, partially offset by lower realized crude oil prices received from the sale of skim oil barrels.

Recycled Water Revenues.

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Other Revenues.

Other revenues primarily include reimbursements from construction projects, booster operating fees and generator rentals, water pipeline revenues, solids disposal revenues, land surface use revenues and brackish non-potable water revenues.

The decrease was due primarily to lower land surface use revenues, mining revenues and lease revenue from certain surface use and compensation agreements primarily due to the sale of our ranches in April 2024 (see Note 17 to our consolidated financial statements included in this Annual Report).

We also had lower reimbursements from construction projects, booster operating fees and generator rentals.

These decreases were partially offset by higher water pipeline revenue, including payments from a producer for committed volumes not delivered, due to our expanded Lea County Express Pipeline system (“LEX II”) commencing operations during the three months ended December 31, 2024.

The increase was due primarily to higher water pipeline revenue, including payments from a producer for committed volumes not delivered, due to our LEX II Expansion commencing operations during the three months ended December 31, 2024, as well as higher reimbursements from construction projects and booster operating fees.

Cost of Sales-Excluding Impact of Derivatives .

The decrease was due primarily to lower recycling costs and a decrease in disposal fees paid to third-parties, partially offset by costs incurred that will be reimbursed by producers for generator and fuel costs at various booster stations.

Derivative (Gain) Loss .

We enter into derivatives in our Water Solutions segment to protect against the risk of a decline in the market price of the crude oil we expect to recover when processing produced water and selling recovered skim oil.

During the year ended March 31, 2025, we had $5.0 million of net unrealized losses on derivatives and $10.0 million of net realized gains on derivatives.

During the year ended March 31, 2024, we had $0.4 million of net unrealized losses on derivatives and $0.8 million of net realized losses on derivatives.

The decrease was due primarily to lower costs incurred that will be reimbursed by producers for generator and fuel costs at various booster stations and lower recycling costs.

Operating and General and Administrative Expenses .

The increase was due primarily to higher royalty expense due to volumes related to the LEX II pipeline commencing operations and increased volumes at certain other saltwater disposal wells, higher business insurance expense for remediation costs incurred and lower severance taxes in the prior year as a result of a severance tax refund in September 2023 related to prior periods.

These increases were partially offset by lower chemical expense due to purchasing fewer chemicals and using them more efficiently and lower repairs and maintenance expense due to the timing of repairs and tank cleaning.

The increase was due primarily to higher royalty expense due to volumes related to the LEX II Expansion commencing operations and increased volumes at certain other saltwater disposal wells and higher utilities expense due to increased produced water volumes processed, partially offset by lower chemical expense due to purchasing fewer chemicals and using chemicals more efficiently and lower bad debt expense.

Depreciation and Amortization Expense .

The increase was due primarily to depreciation of newly developed facilities and infrastructure, partially offset by certain long-term assets being fully amortized, impaired or sold during the fiscal years ended March 31, 2024 and 2025.

Loss on Disposal or Impairment of Assets, Net .

During the year ended March 31, 2025, we recorded a net loss of $15.1 million primarily related to the write down of the value of certain saltwater disposal wells and other assets as well as abandonment of certain capital projects and the retirement of certain other assets.

We also recorded a loss of $8.0 million related to the write down of certain investments in unconsolidated entities and related assets to fair value less cost to sell (see Note 18 to our consolidated financial statements included in this Annual Report).

In addition, we recorded a $3.4 million loss from the settlement of a dispute related to a force majeure event, which resulted in the plugging and abandoning of a disposal well in a prior period.

Lastly, we recorded a net gain of $10.1 million primarily related to the sale of certain assets (see Note 17 to our consolidated financial statements included in this Annual Report) and a gain of $6.5 million from insurance recoveries

for certain saltwater disposal facilities and boosters damaged in a prior period.

During the year ended March 31, 2024, we recorded a net loss of $37.5 million primarily related to the write down of the value of certain saltwater disposal wells as well as the abandonment of certain capital projects and the retirement of certain assets, a net loss of $17.6 million primarily related to the sale of certain assets and an impairment of $2.4 million for certain leases due to underutilization of certain freshwater wells.

In addition, we recorded a gain of $3.9 million from insurance recoveries for certain saltwater disposal facilities and boosters damaged in a prior period.

During the year ended March 31, 2026, we recorded:

• a net loss of $21.7 million primarily related to writing down the net book value of certain saltwater disposal wells and capital projects due to abandonment and the retirement of certain other assets;

• a gain of $2.2 million from insurance recoveries for certain saltwater disposal facilities and boosters damaged in a prior period;

• a net loss of $0.5 million primarily related to the sale of certain assets.

During the year ended March 31, 2025, we recorded:

• a net loss of $15.1 million primarily related to writing down the net book value of certain saltwater disposal wells and capital projects due to abandonment and the retirement of certain other assets;

• a net gain of $10.1 million primarily related to the sale of certain assets (see Note 17 to our consolidated financial statements included in this Annual Report);

• a loss of $8.0 million related to the write down of certain investments in unconsolidated entities and related assets to fair value less cost to sell (see Note 18 to our consolidated financial statements included in this Annual Report);

• a gain of $6.5 million from insurance recoveries for certain saltwater disposal facilities and boosters damaged in a prior period;

• a loss of $3.4 million from the settlement of a dispute related to a force majeure event, which resulted in the plugging and abandoning of a disposal well in a prior period.

Revaluation of Liabilities.

During the year ended March 31, 2025, there was a decrease in expense for the valuation of our contingent consideration liabilities related to royalty agreements acquired as part of certain business combinations due primarily to lower expected produced water volumes from our customers, resulting in a decrease to the expected future royalty payment.

During the year ended March 31, 2024, there was an increase in expense for the valuation of our contingent consideration liabilities related to royalty agreements acquired as part of certain business combinations due primarily to higher expected production from new customers, resulting in an increase to the expected future royalty payment.

Revaluation of liabilities includes the valuation of our contingent consideration liabilities related to royalty agreements acquired as part of certain business combinations.

During the year ended March 31, 2026, there was an increase in expense due primarily to higher expected produced water volumes from our customers, resulting in an

increase to the expected future royalty payment.

During the year ended March 31, 2025, there was a decrease in expense due primarily to lower expected produced water volumes from our customers, resulting in a decrease to the expected future royalty payment.

Crude Oil Logistics

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Cost of sales-excluding impact of derivatives 951,676 771,526 180,150

Derivative (gain) loss (2,872) 7,367 (10,239)

Cost of sales-derivative loss (gain)-unrealized 5,604 (4,664) 10,268

Cost of sales-derivative loss-realized 7,001 1,792 5,209

Operating expenses 38,398 38,408 (10)

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Depreciation and amortization expense 24,331 25,070 (739)

(Gain) loss on disposal or impairment of assets, net (1,004) 3,094 (4,098)

Loss (gain) on disposal or impairment of assets, net 251,761 (1,004) 252,765

Total expenses 1,281,523 833,801 447,722

Segment operating income $ 46,101 $ 52,074 $ (5,973)

Segment operating (loss) income $ (226,892) $ 46,101 $ (272,993)

Adjusted EBITDA - Continuing Operations (1) $ 58,941 $ 66,373 $ (7,432)

Crude oil sold (barrels) 15,419 10,412 5,007

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Crude oil product margin ($/barrel) (3) $ 4.447 $ 3.373 $ 1.074

(1) See Adjusted EBITDA definition and reconciliation in “Non-GAAP Financial Measures” section below.

(2) Information is presented as of March 31, 2026 and March 31, 2025, respectively.

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Crude Oil Sales and Cost of Sales-Excluding Impact of Derivatives.

The decreases in sales and cost of sales, excluding the impact of derivatives, were due primarily to lower sales volumes due to lower production on acreage dedicated to us in the DJ Basin during the year ended March 31, 2025, compared to the year ended March 31, 2024.

Lower crude oil prices also contributed to the decrease.

During the year ended March 31, 2025, the crude oil product margin decreased primarily due to lower volumes as discussed further above.

Contributing to the decrease in product margin and margin per barrel was the expiration of certain higher-margin purchase contracts during the year ended March 31, 2024, which resulted in lower margin realized on barrels purchased during the year ended March 31, 2025.

The decrease in margin per barrel for the year ended March 31, 2025, compared to the year ended March 31, 2024 was partially offset by higher price and quality differentials realized, and the sale

of the remaining pipeline transportation deficiency credits included in gross margin during the year ended March 31, 2025.

The increases in sales and cost of sales, excluding the impact of derivatives, were due primarily to higher production on acreage dedicated to us in the DJ Basin during the year ended March 31, 2026, partially offset by lower commodity prices.

During the year ended March 31, 2026, the crude oil product margin increased compared to the year ended March 31, 2025 due to higher crude oil barrels sold during the year.

Product margin per barrel also increased due to a general increase in commodity prices, specifically during the quarter ended March 31, 2026, thus contributing to a higher margin per barrel for the current period.

Crude oil product margin calculations do not include gains and losses from derivatives that may offset the movement in the physical margin.

Derivative (Gain) Loss.

Our cost of sales during the year ended March 31, 2025 included $1.1 million of net realized losses on derivatives and $4.0 million of net unrealized gains on derivatives.

Our cost of sales during the year ended March 31, 2024 included $58.4 million of net realized gains on derivatives and $65.8 million of net unrealized losses on derivatives.

The amounts in the previous sentence for the year ended March 31, 2024 includes net realized gains of $60.9 million and net unrealized losses of $61.4 million associated with derivative instruments related to our hedge of the CMA Differential Roll, defined and discussed below under “–Non-GAAP Financial Measures.”

Crude Oil Transportation and Other Sales.

The increase was primarily due to higher tariff revenue on the Grand Mesa Pipeline as a result of signing a new shipper during the open season that ended January 5, 2024.

Additionally, the year ended March 31, 2025 benefited from higher terminaling revenue from an acreage dedication in the Eagle Ford Basin and higher throughput revenue from crude oil transported on third-party pipelines.

These increases were partially offset by lower storage fees at our Cushing terminal during the year ended March 31, 2025.

During the year ended March 31, 2025, physical volumes on the Grand Mesa Pipeline averaged approximately 61,000 barrels per day, compared to approximately 70,000 barrels per day for the year ended March 31, 2024.

Lower contracted volumes were shipped on the Grand Mesa Pipeline due to lower production on acreage dedicated to us in the DJ Basin.

The decrease was primarily due to lower pipeline revenue resulting from the expiration of certain transportation services contracts on third-party pipelines and lower rental revenue due to the sale of our railcars.

During the year ended March 31, 2026, physical volumes on the Grand Mesa Pipeline were approximately 72,000 barrels per day, compared to approximately 61,000 barrels per day for the year ended March 31, 2025.

Higher contracted volumes were shipped on the Grand Mesa Pipeline due to higher production on acreage dedicated to us in the DJ Basin.

Operating and General and Administrative Expenses .

The decrease was primarily due to lower utilities expense and lower materials and supplies expense on the Grand Mesa Pipeline and at our Cushing terminal from lower volumes flowing through the system during the year ended March 31, 2025, compared to the year ended March 31, 2024.

In addition, the year ended March 31, 2025 benefited from lower cleaning, repairs and maintenance costs on our owned railcars, lower environmental costs at one of our terminals, and lower corporate cost allocations.

These decreases were partially offset by higher incentive compensation expenses and higher ad valorem taxes assessed on the Grand Mesa Pipeline by the State of Colorado.

Operating and general and administrative expenses were consistent with the prior year.

Depreciation and Amortization Expense.

The decrease was primarily due to certain assets becoming fully depreciated during the year ended March 31, 2024.

(Gain) Loss on Disposal or Impairment of Assets, Net .

The decrease was primarily due to the sale of railcars during the years ended March 31, 2025 and 2026.

Loss (Gain) on Disposal or Impairment of Assets, Net .

During the year ended March 31, 2026, we recorded a net loss of $251.8 million.

The net loss was due to a goodwill impairment loss of $247.8 million (see Note 5 to our consolidated financial statements included in this Annual Report).

We also recorded a loss from the sale of linefill held on third-party pipelines of $5.7 million, which includes a loss from derivatives of $5.5 million from hedging transactions relating to the sale of linefill barrels, a loss of $0.3 million related to the sale or retirement of certain assets and a gain of $2.0 million from the sale of railcars (see Note 17 to our consolidated financial statements included in this Annual Report).

During the year ended March 31, 2025, we recorded a net gain of $1.0 million primarily due to the gain on the sale of railcars (see Note 17 to our consolidated financial statements included in this Annual Report), partially offset by the write-down in value of linefill expected to be sold over the next four months and the loss on the sale of certain other assets.

During the year ended March 31, 2024, we recorded a net loss of $3.1 million primarily due to the retirement or sale of certain assets.

Liquids Logistics

The following table summarizes the operating results of our Liquids Logistics segment for the periods indicated.

As discussed above, the operating results of our refined products and biodiesel businesses have been classified as discontinued operations for all periods presented and prior periods have been retrospectively adjusted.

As discussed above, the operating results of our refined products and biodiesel businesses have been classified as discontinued operations and prior periods have been retrospectively adjusted.

Year Ended March 31,

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Cost of sales-excluding impact of derivatives 521,340 606,694 (85,354)

Derivative (gain) loss (1,509) 2,463 (3,972)

Cost of sales-derivative loss (gain)-unrealized 10,615 (588) 11,203

Cost of sales-derivative (gain) loss-realized (2,408) 14,724 (17,132)

Product margin 24,944 28,622 (3,678)

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Cost of sales-excluding impact of derivatives 316,069 721,372 (405,303)

Derivative loss 14,136 2,771 11,365

Cost of sales-derivative (gain) loss-unrealized (1,310) 2,973 (4,283)

Cost of sales-derivative gain-realized (393) (4,482) 4,089

Product margin 22,308 35,783 (13,475)

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Cost of sales-excluding impact of derivatives 341,981 393,935 (51,954)

Derivative (gain) loss (272) 25 (297)

Cost of sales-derivative (gain) loss-unrealized (4) 38 (42)

Cost of sales-derivative loss (gain)-realized 30 (310) 340

Product margin 20,875 21,322 (447)

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Depreciation and amortization expense 6,201 9,408 (3,207)

Loss on disposal or impairment of assets, net 22,596 59,923 (37,327)

(Gain) loss on disposal or impairment of assets, net (15,551) 22,596 (38,147)

Total expenses 26,784 83,562 (56,778)

Segment operating income (loss) $ 14,058 $ (13,178) $ 27,236

Segment operating income $ 48,231 $ 14,058 $ 34,173

Adjusted EBITDA - Continuing Operations (1) $ 45,483 $ 53,369 $ (7,886)

Natural gas liquids storage capacity - owned and leased (gallons) (2) 42,641 52,721 (10,080)

Butane sold (gallons) 510,367 516,202 (5,835)

Butane sold ($/gallon) $ 1.086 $ 1.258 $ (0.172)

Cost per butane sold ($/gallon) (3) $ 1.022 $ 1.175 $ (0.153)

Butane product margin ($/gallon) (3) $ 0.064 $ 0.083 $ (0.019)

Butane inventory (gallons) (2) 23,774 21,871 1,903

Propane sold (gallons) 365,736 760,287 (394,551)

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Propane inventory (gallons) (2) 7,297 11,833 (4,536)

Butane sold (gallons) 516,202 537,015 (20,813)

Butane sold ($/gallon) $ 1.258 $ 1.171 $ 0.087

Cost per butane sold ($/gallon) (2) $ 1.175 $ 1.094 $ 0.081

Butane product margin (loss) ($/gallon) (2) $ 0.083 $ 0.077 $ 0.006

Butane inventory (gallons) (1) 21,871 17,790 4,081

Other products sold (gallons) 281,494 277,495 3,999

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Other products inventory (gallons) (2) 5,166 8,556 (3,390)

(1) See Adjusted EBITDA definition and reconciliation in “Non-GAAP Financial Measures” section below.

(2) Information is presented as of March 31, 2026 and March 31, 2025, respectively.

(2) Cost and product margin (loss) per gallon excludes the impact of derivatives.

Propane Sales and Cost of Sales-Excluding Impact of Derivatives.

The increases in sales and cost of sales, excluding the impact of derivatives, were primarily due to higher prices during the quarter ended March 31, 2025 due to the cold weather experienced throughout the United States during the first two months of the quarter.

Propane volumes decreased during the year ended March 31, 2025 due to lower contracted volumes and reduced retail customer demand.

Propane product margins, excluding the impact of derivatives, decreased during the year ended March 31, 2025 primarily due to lower volumes.

For most of the year ended March 31, 2025, we sold higher priced inventory into a market of declining prices, compared to the year ended March 31, 2024, when we were selling lower priced inventory into a market with rising prices.

In addition, during the quarter ended March 31, 2025, due to an increase in demand due to the colder than normal weather, we were short product and had to purchase spot barrels at higher prices to fulfill term obligations, resulting in lower margins.

Propane Derivative (Gain) Loss.

Our cost of propane sales included $3.0 million of net unrealized losses on derivatives and $4.5 million of net realized gains on derivatives during the year ended March 31, 2025.

During the year ended March 31, 2024, our cost of propane sales included $4.6 million of net unrealized gains on derivatives and $7.0 million of net realized losses on derivatives.

(3) Cost and product margin per gallon excludes the impact of derivatives.

Butane Sales and Cost of Sales-Excluding Impact of Derivatives.

The increases in sales and cost of sales, excluding the impact of derivatives, were due primarily to higher butane prices during the year ended March 31, 2025.

Butane product margins, excluding the impact of derivatives, increased during the year ended March 31, 2025, as compared to the year ended March 31, 2024, primarily due to higher prices, partially offset by lower volumes due to a weak gasoline blending season.

Butane Derivative Loss.

Our cost of butane sales during the year ended March 31, 2025 included $0.6 million of net unrealized gains on derivatives and $14.7 million of net realized losses on derivatives.

Our cost of butane sales included $3.2 million of net unrealized losses on derivatives and $0.5 million of net realized gains on derivatives during the year ended March 31, 2024.

The decreases in sales and cost of sales, excluding the impact of derivatives, were due primarily to lower butane prices and volumes during the year ended March 31, 2026, compared to the year ended March 31, 2025.

Butane product margins, excluding the impact of derivatives, decreased during the year ended March 31, 2026, compared to the year ended March 31, 2025 due to a weak gasoline blending season in certain markets and higher-priced inventory sold into a declining market.

Propane Sales and Cost of Sales-Excluding Impact of Derivatives.

The decreases in sales and cost of sales, excluding the impact of derivatives, were due primarily to the Wholesale Propane Disposition.

Propane product margins, excluding the impact of derivatives, decreased during the year ended March 31, 2026, compared to the year ended March 31, 2025 primarily due to the Wholesale Propane Disposition.

In addition, margins were negatively impacted due to selling higher-priced inventory into a declining market early in the year.

Other Products Sales and Cost of Sales-Excluding Impact of Derivatives.

The increases in sales and cost of sales, excluding the impact of derivatives, were primarily due to an increase in prices and volumes.

Strong spot markets led to an increase in isobutane and natural gasoline sales and asphalt sales increased due to a consistent supply during the year ended March 31, 2025.

Other products sales product margins, excluding the impact of derivatives, increased during the year ended March 31, 2025 due to the increase in volumes and prices, as discussed further above.

Other Products Derivative (Gain) Loss.

Our derivatives of other products included $0.3 million of net realized gains on derivatives during the year ended March 31, 2025.

Our derivatives of other products during the year ended March 31, 2024 included $0.1 million of net realized gains on derivatives and $0.1 million of net unrealized losses on derivatives.

The decreases in sales and cost of sales, excluding the impact of derivatives, were due primarily to decreased commodity prices during the year ended March 31, 2026, compared to the year ended March 31, 2025, partially offset by increased volumes.

Other products sales product margins, excluding the impact of derivatives, decreased during the year ended March 31, 2026, compared to the year ended March 31, 2025 primarily due to lower commodity prices and lower asphalt volumes and margins due to tighter supply.

Service Sales and Cost of Sales.

The sales include storage, terminaling and transportation services income.

Sales and cost of sales during the year ended March 31, 2025 remained consistent with the year ended March 31, 2024.

Sales and cost of sales decreased during the year ended March 31, 2026 due to the Wholesale Propane Disposition and the expiration of a throughput agreement during the year ended March 31, 2025.

Operating and General and Administrative Expenses.

The decrease during the year ended March 31, 2025 compared to the year ended March 31, 2024 was primarily due to a decrease in incentive compensation due to lower than expected earnings, a decrease in travel and entertainment expenses due to our efforts in the prior year to visit all customers and lower office lease expense due to the sale of certain terminals in the prior year.

The decrease during the year ended March 31, 2026 compared to the year ended March 31, 2025 was primarily due to the Wholesale Propane Disposition.

Depreciation and Amortization Expense.

The decrease was due to a customer relationship intangible asset being fully amortized as of June 30, 2023.

Loss on Disposal or Impairment of Assets, Net.

The decrease during the year ended March 31, 2026 compared to the year ended March 31, 2025 was primarily due to the Wholesale Propane Disposition.

(Gain) Loss on Disposal or Impairment of Assets, Net.

During the year ended March 31, 2026, we recorded a net gain of $17.1 million due to the Wholesale Propane Disposition.

We also recorded a net loss of $1.6 million related to the impairment of certain right-of-use assets.

During the year ended March 31, 2025, we recorded a net loss of $22.6 million.

The net loss was due to a goodwill impairment loss of $17.9 million in our Wholesale/Terminal reporting unit (see Note 5 to our consolidated financial statements included in this Annual Report).

We also recorded a net loss of $7.3 million due to costs incurred related to the sale of certain natural gas liquid terminals and a net gain of $2.0 million for the sale of the Green Bay terminal discussed in Note 17 to our consolidated financial statements included in this Annual Report.

During the year

ended March 31, 2024, we recorded a goodwill impairment loss of $69.2 million in our Wholesale/Terminal reporting unit (see Note 5 to our consolidated financial statements included in this Annual Report).

In addition, we recorded a net gain of $8.5 million due to the sale of three natural gas liquids terminals and we recorded a net gain of $0.8 million related to the retirement or sale of certain other assets.

We also recorded a net loss of $7.3 million due to costs incurred related to the Wholesale Propane Disposition and a net gain of $2.0 million for the sale of the Green Bay terminal discussed in Note 17 to our consolidated financial statements included in this Annual Report.

Corporate and Other

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(in thousands)

Other revenues:

Service revenues $ 422 $ 401 $ 21

Cost of sales:

Derivative gain — (937) 937

General and administrative expenses 59,145 39,592 19,553

Depreciation and amortization expense 3,251 3,027 224

Loss (gain) on disposal or impairment of assets, net 43 (720) 763

(Gain) loss on disposal or impairment of assets, net (2) 43 (45)

Total expenses 62,394 42,662 19,732

Operating loss $ (61,972) $ (42,261) $ (19,711)

Adjusted EBITDA - Continuing Operations (1) $ (46,947) $ (38,846) $ (8,101)

(1) See Adjusted EBITDA definition and reconciliation in “Non-GAAP Financial Measures” section below.

Service Revenues.

These revenues relate to billings to the noncontrolling interest holders for usage of the airplanes acquired in June and October 2024.

Cost of Sales - Derivative Gain.

Our cost of sales during the year ended March 31, 2024 included $0.2 million of net realized losses on derivatives and $1.2 million of net unrealized gains on derivatives.

We entered into economic hedges to protect our liquidity positions and leverage from a significant increase in commodity prices that drive our working capital demands.

There were no open hedge positions that would impact cost of sales as of March 31, 2025.

General and Administrative Expenses .

The decrease during the year ended March 31, 2025 is primarily due to the increase in our accrual as of March 31, 2024, related to the LCT Capital, LLC (“LCT”) legal matter (see Note 8 to our consolidated financial statements included in this Annual Report and also in the section below discussing the segment operating results for the years ended March 31, 2024 and 2023).

The decrease also relates to lower legal expenses as several large cases ended and lower business insurance expense as we paid an insurance company in the prior year for the release of any supplementary calls related to our former crude marine business.

Compensation expense was also lower due to the elimination of the share-based compensation expense due to all outstanding long-term incentive plan awards being fully vested in November 2023.

The increase was primarily due to the addition of equity-based compensation expense related to awards granted under the 2025 Long-Term Incentive Plan (“2025 Plan”) (see Note 9 to our consolidated financial statements included in this Annual Report), increased legal expenses due primarily to a reimbursement of legal expenses related to a dispute associated with commercial activities received in the prior year and lower allocations of overhead expenses to the other business segments during the year ended March 31, 2026 due to recent disposition transactions.

Depreciation and Amortization Expense.

The decrease during the year ended March 31, 2025 was due to software that became fully depreciated during the year ended March 31, 2024.

Loss (Gain) on Disposal or Impairment of Assets, Net.

During the year ended March 31, 2025, we recorded a net loss of less than $0.1 million due to the write-off of information technology equipment.

During the year ended March 31, 2024, we sold an airplane for a gain of $0.7 million.

Equity in Earnings of Unconsolidated Entities

Equity in earnings of unconsolidated entities was $6.6 million during the year ended March 31, 2025, compared to $4.1 million during the year ended March 31, 2024.

The increase of $2.5 million during the year ended March 31, 2025 was due primarily to higher earnings from certain membership interests related to specific land and water services operations.

The increase during the year ended March 31, 2026 was due to depreciation of the two airplanes put into service during the year ended March 31, 2025.

(Gain) Loss on Disposal or Impairment of Assets, Net.

During the year ended March 31, 2026, we recorded a gain of less than $0.1 million on the sale of a vehicle.

During the year ended March 31, 2025, we recorded a loss of less than $0.1 million due to the write-off of information technology equipment.

Interest Expense

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Senior secured notes $ 180,567 $ 182,000 $ (1,433)

Senior secured term loan “B” credit facility (“Term Loan B”) 63,118 11,275 51,843

2024 Term Loan B 51,203 63,118 (11,915)

ABL Facility 9,286 20,893 (11,607)

Senior unsecured notes — 40,829 (40,829)

2026 Term Loan B 3,788 — 3,788

Other indebtedness 1,356 1,630 (274)

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Amortization of debt issuance costs 12,582 12,010 572

Unrealized loss (gain) on interest rate swaps 3,054 (515) 3,569

Realized gain on interest rate swaps (2,627) — (2,627)

Unrealized (gain) loss on interest rate swaps (1,369) 3,054 (4,423)

Realized loss (gain) on interest rate swaps 77 (2,627) 2,704

Total interest expense $ 257,490 $ 280,078 $ (22,588)

The debt interest expense increased $13.0 million during the year ended March 31, 2025 primarily due to higher interest rates on the Term Loan B, the 8.125% senior secured notes due 2029 (“2029 Senior Secured Notes”) and the 8.375% senior secured notes due 2032 (“2032 Senior Secured Notes”).

This was partially offset by the repurchase/redemption of the 6.125% senior unsecured notes due 2025 (“2025 Notes”) and the redemption of the 7.5% senior unsecured notes due 2026 (“2026 Notes”) (collectively, the “Senior Unsecured Notes”) during the year ended March 31, 2024.

Also, in the prior year we had an interest accrual of $26.1 million, included in other indebtedness, related to the LCT legal matter (see Note 8 to our consolidated financial statements included in this Annual Report).

Loss on Early Extinguishment of Liabilities, Net

Loss on early extinguishment of liabilities, net was $55.3 million during the year ended March 31, 2024.

During the year ended March 31, 2024, the net loss (inclusive of debt issuance costs written off) primarily relates to the call premium of $38.4 million paid for the early extinguishment of the outstanding 7.5% senior secured notes due 2026 (“2026 Senior Secured Notes”), the write-off of debt issuance costs and other expenses related to the repurchase/redemption of the 2026 Senior Secured Notes and Senior Unsecured Notes during the fiscal year.

We did not repurchase any debt during the year ended March 31, 2025.

See Note 7 to our consolidated financial statements included in this Annual Report for a further discussion of the debt instruments repurchased and redeemed.

Other Income, Net

Other income, net of $4.3 million during the year ended March 31, 2025 consisted primarily of a gain on the expiration of an option, realized and unrealized gains on marketable securities, interest income on loan receivables (see Note 2 to our consolidated financial statements included in this Annual Report for a further discussion) and unrealized losses on investments.

Other income, net of $2.8 million during the year ended March 31, 2024 consisted primarily of interest income on loan receivables and cash on hand, income from the settlement of a dispute and income from excess distributions received from an equity method investee.

Income Tax Benefit (Expense)

Income tax benefit was $4.9 million during the year ended March 31, 2025, compared to income tax expense of $1.5 million during the year ended March 31, 2024.

See Note 2 to our consolidated financial statements included in this Annual Report for a further discussion.

Noncontrolling Interests - Redeemable and Nonredeemable

Noncontrolling interests represent the portion of certain consolidated subsidiaries that are owned by third-parties.

Noncontrolling interest income was $3.8 million during the year ended March 31, 2025, compared to $0.6 million during the year ended March 31, 2024.

The increase of $3.2 million during the year ended March 31, 2025 was due primarily to higher income from certain water solutions operations.

The debt interest expense decreased $21.4 million during the year ended March 31, 2026 primarily due to a lower weighted average daily balance on the ABL Facility and lower interest rates on the 2024 Term Loan B for the year ended March 31, 2026 compared to the year ended March 31, 2025.

Segment Operating Results for the Years Ended March 31, 2025 and 2024

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Cost of sales-excluding impact of derivatives 7,848 10,146 (2,298)

Derivative loss 1,148 4,363 (3,215)

Cost of sales-derivative loss-unrealized 4,953 385 4,568

Cost of sales-derivative (gain) loss-realized (9,954) 763 (10,717)

Operating expenses 214,928 212,052 2,876

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Segment operating income $ 311,457 $ 231,256 $ 80,201

Adjusted EBITDA - Continuing Operations (3) $ 541,996 $ 508,308 $ 33,688

Produced water processed (barrels per day)

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Operating expenses for produced water processed ($/barrel) (5) $ 0.22 $ 0.24 $ (0.02)

In Note 11, Sale of Water includes the sale of produced water, recycled water and brackish non-potable water, which in the table above, brackish non-potable water is included in Other revenues.

(3) See Adjusted EBITDA definition and reconciliation in “Non-GAAP Financial Measures” section below.

(4) As of March 31, 2023, approximately 34,380 barrels of skim oil were stored and were sold during the year ended March 31, 2024.

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addition, water pipeline revenue, which is included in Other revenues, includes payments from a producer for 19,257,873 committed barrels not delivered during the year ended March 31, 2025.

(6) Excluding payments made by certain producers for committed volumes not delivered and the one-time item discussed below, service fees for produced water processed ($/barrel) would have been $0.60/barrel and $0.61/barrel during the years ended March 31, 2025 and 2024, respectively.

Water Disposal Service Fee Revenues.

The increase was due primarily to an increase in produced water volumes processed from contracted customers mainly in the Delaware Basin, increased fees from new contracts and higher fees charged for interruptible spot volumes.

There was also an increase in payments made by certain producers for committed volumes not delivered.

Service fees for produced water processed ($/barrel) also benefited from these deficiency payments.

The increase was due primarily to an increase in produced water volumes processed from contracted customers and higher fees charged for interruptible spot volumes.

There was also a decrease in payments made by certain producers for committed volumes not delivered.

Recovered Crude Oil Revenues.

The decrease was due primarily to lower realized crude oil prices received from the sale of skim oil barrels, partially offset by an increase in skim oil barrels sold as a result of higher skim oil recovered from increased produced water processed.

In addition, during the current fiscal year we sold 34,380 barrels of skim oil that were stored as of March 31, 2023 due to tighter pipeline specifications.

Also, during the year ended March 31, 2024, we sold approximately 34,380 barrels of skim oil that were stored as of March 31, 2023 due to tighter pipeline specifications.

Recycled Water Revenues.

The decrease was due primarily to lower recycled water volumes related to timing of water to be used in completions.

The decrease was due primarily to lower pricing for recycled water, partially offset by higher recycled water volumes related to timing of water to be used in completions.

Other Revenues.

The increase was due primarily to higher reimbursements from construction projects, booster operating fees and generator rentals, higher land surface use revenues and higher lease revenue from certain surface use and compensation agreements.

These increases were partially offset by lower water pipeline revenues due to the expiration of certain pipeline commitment revenue in December 2022 and lower sales of brackish non-potable water related to the timing of our customers transitioning from brackish non-potable water to recycled water.

We also had lower reimbursements from construction projects, booster operating fees and generator rentals.

These decreases were partially offset by higher water pipeline revenue, including payments from a producer for committed volumes not delivered, due to our LEX II Expansion commencing operations during the three months ended December 31, 2024.

Cost of Sales-Excluding Impact of Derivatives .

The increase was due primarily to costs incurred that will be reimbursed by producers for generator and fuel costs at various booster stations.

In addition, we incurred increased trucking expenses for skim oil sales during the year ended March 31, 2024.

These increases were partially offset by lower recycling costs due to a decrease in recycling activity and lower purchases of brackish non-potable water from third-parties to meet customer needs.

Derivative Loss.

During the year ended March 31, 2024, we had $0.4 million of net unrealized losses on derivatives and $0.8 million of net realized losses on derivatives.

During the year ended March 31, 2023, we had $4.5 million of net unrealized gains on derivatives and $8.8 million of net realized losses on derivatives.

Operating and General and Administrative Expenses .

The decrease was due primarily to lower chemical expense due to purchasing fewer chemicals and using chemicals more efficiently, lower overhead costs, lower generator rental expense due to renting fewer generators and lower severance taxes due to a decrease in revenue from recovered crude oil and a severance tax refund in September 2023 related to prior periods.

These decreases were partially offset by higher operating expenses due to increased produced water volumes processed.

The increase was due primarily to higher royalty expense due to volumes related to the LEX II Expansion commencing operations and increased volumes at certain other saltwater disposal wells, higher business insurance expense for remediation costs incurred and lower severance taxes in the prior year as a result of a severance tax refund in September 2023 related to prior periods.

Depreciation and Amortization Expense .

The increase was due primarily to depreciation of newly developed facilities and infrastructure, partially offset by certain long-term assets being fully amortized or impaired during the fiscal years ended March 31, 2023 and 2024.

Loss on Disposal or Impairment of Assets, Net.

In addition, we recorded a gain of $3.9 million from insurance recoveries for certain saltwater disposal facilities and boosters damaged in a prior period.

During the year ended March 31, 2023, we recorded a net loss of $26.3 million primarily related to the sale of certain assets and a net loss of $21.8 million to write down the value of an inactive saltwater disposal facility and damaged equipment at another saltwater disposal facility, as well as the abandonment of certain capital projects and the retirement of certain assets.

We also recorded a loss of $0.5 million related to the termination of a joint marketing agreement.

In addition, we recorded a gain of $2.1 million from an insurance recovery for a saltwater disposal facility damaged in a prior period.

During the year ended March 31, 2025, we recorded:

• a net gain of $10.1 million primarily related to the sale of certain assets (see Note 17 to our consolidated financial statements included in this Annual Report);

• a gain of $6.5 million from insurance recoveries for certain saltwater disposal facilities and boosters damaged in a prior period;

• a loss of $3.4 million from the settlement of a dispute related to a force majeure event, which resulted in the plugging and abandoning of a disposal well in a prior period.

During the year ended March 31, 2024, we recorded:

• a net loss of $37.5 million primarily related to writing down the net book value of certain saltwater disposal wells and capital projects due to abandonment and the retirement of certain assets;

• a net loss of $17.6 million primarily related to the sale of certain assets;

• a gain of $3.9 million from insurance recoveries for certain saltwater disposal facilities and boosters damaged in a prior period;

• an impairment of $2.4 million for certain leases due to underutilization of certain freshwater wells.

Revaluation of Liabilities.

During the years ended March 31, 2024 and 2023, there was an increase in expense for the valuation of our contingent consideration liabilities related to royalty agreements acquired as part of certain business combinations due primarily to higher expected produced water volumes from our customers, resulting in an increase to the expected future royalty payment.

Revaluation of liabilities includes the valuation of our contingent consideration liabilities related to royalty agreements acquired as part of certain business combinations.

During the year ended March 31, 2024, there was an increase in expense due primarily to higher expected production from new customers, resulting in an increase to the expected future royalty payment.

Crude Oil Logistics

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Cost of sales-excluding impact of derivatives 771,526 1,514,370 (742,844)

Derivative loss (gain) 7,367 (14,565) 21,932

Cost of sales-derivative (gain) loss -unrealized (4,664) 65,786 (70,450)

Cost of sales-derivative loss (gain) -realized 1,792 (58,419) 60,211

Operating expenses 38,408 39,004 (596)

1 unchanged sentence

Depreciation and amortization expense 25,070 36,922 (11,852)

Loss on disposal or impairment of assets, net 3,094 31,086 (27,992)

(Gain) loss on disposal or impairment of assets, net (1,004) 3,094 (4,098)

Total expenses 833,801 1,604,537 (770,736)

Segment operating income $ 46,101 $ 52,074 $ (5,973)

Adjusted EBITDA - Continuing Operations (1) $ 66,373 $ 86,887 $ (20,514)

Crude oil sold (barrels) 10,412 20,068 (9,656)

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Crude oil product margin ($/barrel) (3) $ 3.373 $ 4.129 $ (0.756)

(1) See Adjusted EBITDA definition and reconciliation in “Non-GAAP Financial Measures” section below.

(2) Information is presented as of March 31, 2025 and March 31, 2024, respectively.

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Crude Oil Sales and Cost of Sales-Excluding Impact of Derivatives.

Crude oil product margin from the sale of crude oil decreased from $102.3 million for the year ended March 31, 2023 to $82.9 million during the year ended March 31, 2024, primarily due to lower volumes and lower crude oil prices year over year.

The lower crude oil prices resulted in lower contracted rates with certain producers, compared to the prior year when the contracted rates were higher due to the higher crude oil prices.

We also realized lower contract differentials on certain other sales contracts.

Crude oil product margin per barrel increased during the year ended March 31, 2024, compared to the year ended March 31, 2023, due to the sale of lower priced inventory into a market in which prices were increasing during certain periods of 2024.

Whereas during the year ended March 31, 2023, we were selling higher priced inventory into a market in which prices were generally declining throughout the fiscal year.

Crude oil product margin calculations does not include gains and losses from derivatives that may offset the movement in the physical margin.

Derivative Loss (Gain).

Our cost of sales during the year ended March 31, 2024 included $58.4 million of net realized gains on derivatives and $65.8 million of net unrealized losses on derivatives.

The amounts in the previous sentence for the year ended March 31, 2024 included net realized gains of $60.9 million and net unrealized losses of $61.4 million associated with derivative instruments related to our hedge of the CMA Differential Roll, defined and discussed below under “–Non-GAAP Financial Measures.” Our cost of sales during the year ended March 31, 2023 included $35.5 million of net realized losses on derivatives and $50.1 million of net unrealized gains on derivatives.

The amounts in the previous sentence for the year ended

March 31, 2023 includes net realized losses of $13.1 million and net unrealized gains of $23.8 million associated with derivative instruments related to our hedge of the CMA Differential Roll.

Lower crude oil prices also contributed to the decrease.

During the year ended March 31, 2025, the crude oil product margin decreased primarily due to lower volumes as discussed further above.

The decrease in margin per barrel for the year ended March 31, 2025, compared to the year ended March 31, 2024 was partially offset by higher price and quality differentials realized, and the sale of the remaining pipeline transportation deficiency credits included in gross margin during the year ended March 31, 2025.

Crude oil product margin calculations do not include gains and losses from derivatives that may offset the movement in the physical margin.

Crude Oil Transportation and Other Sales.

The decrease was primarily due to the sale of our marine assets on March 30, 2023, and lower pipeline tariff revenue due to the assignment of our commitment on a third-party pipeline.

During the year ended March 31, 2024, physical volumes on the Grand Mesa Pipeline averaged approximately 70,000 barrels per day, compared to approximately 76,000 barrels per day for the year ended March 31, 2023.

The increase was primarily due to higher tariff revenue on the Grand Mesa Pipeline as a result of signing a new shipper during the open season that ended January 5, 2024.

These increases were partially offset by lower storage fees at our Cushing terminal during the year ended March 31, 2025.

During the year ended March 31, 2025, physical volumes on the Grand Mesa Pipeline were approximately 61,000 barrels per day, compared to approximately 70,000 barrels per day for the year ended March 31, 2024.

Lower contracted volumes were shipped on the Grand Mesa Pipeline due to lower production on acreage dedicated to us in the DJ Basin.

Operating and General and Administrative Expenses .

The decrease was primarily due to the sale of our marine assets on March 30, 2023.

Additionally, the current year benefited from lower incentive compensation expense, as well as lower repairs and maintenance expense on leased railcars returned to the lessor in the prior year.

These decreases were partially offset by higher incentive compensation expenses and higher ad valorem taxes assessed on the Grand Mesa Pipeline by the State of Colorado.

Depreciation and Amortization Expense.

The decrease was primarily due to the sale of our marine assets on March 30, 2023, lower depreciation expense due to certain of our railcar assets becoming fully depreciated during the year ended March 31, 2024 and the impairment of certain terminal assets in the prior year, which lowered their depreciable base.

Loss on Disposal or Impairment of Assets, Net .

The decrease was primarily due to certain assets becoming fully depreciated during the year ended March 31, 2024.

(Gain) Loss on Disposal or Impairment of Assets, Net .

During the year ended March 31, 2024, we recorded a net loss of $3.1 million primarily due to the retirement or sale of certain assets.

During the year ended March 31, 2023, we recorded an impairment of $23.1 million related to an underperforming crude oil terminal and a loss of $8.0 million on the sale of our marine assets.

Liquids Logistics

The following table summarizes the operating results of our Liquids Logistics segment for the periods indicated.

As discussed above, the operating results of our refined products and biodiesel businesses have been classified as discontinued operations and prior periods have been retrospectively adjusted.

Year Ended March 31,

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Cost of sales-excluding impact of derivatives 606,694 587,307 19,387

Derivative loss 2,463 11,642 (9,179)

Cost of sales-derivative (gain) loss-unrealized (588) 3,238 (3,826)

Cost of sales-derivative loss (gain)-realized 14,724 (467) 15,191

Product margin 28,622 38,607 (9,985)

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Cost of sales-excluding impact of derivatives 721,372 692,649 28,723

Derivative loss (gain) 2,771 (22,976) 25,747

Cost of sales-derivative loss (gain)-unrealized 2,973 (4,571) 7,544

Cost of sales-derivative (gain) loss-realized (4,482) 7,034 (11,516)

Product margin 35,783 44,479 (8,696)

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Cost of sales-excluding impact of derivatives 393,935 367,293 26,642

Derivative loss 25 1,246 (1,221)

Cost of sales-derivative loss-unrealized 38 104 (66)

Cost of sales-derivative gain-realized (310) (79) (231)

Product margin 21,322 16,680 4,642

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Total expenses 83,562 125,716 (42,154)

Segment operating (loss) income $ (13,178) $ 21,446 $ (34,624)

Segment operating income (loss) $ 14,058 $ (13,178) $ 27,236

Adjusted EBITDA - Continuing Operations (1) $ 53,369 $ 53,287 $ 82

Natural gas liquids storage capacity - owned and leased (gallons) (2) 52,721 122,831 (70,110)

Butane sold (gallons) 516,202 537,015 (20,813)

Butane sold ($/gallon) $ 1.258 $ 1.171 $ 0.087

Cost per butane sold ($/gallon) (3) $ 1.175 $ 1.094 $ 0.081

Butane product margin ($/gallon) (3) $ 0.083 $ 0.077 $ 0.006

Butane inventory (gallons) (2) 21,871 17,790 4,081

Propane sold (gallons) 760,287 811,035 (50,748)

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Propane inventory (gallons) (2) 11,833 35,177 (23,344)

Butane sold (gallons) 537,015 539,658 (2,643)

Butane sold ($/gallon) $ 1.171 $ 1.434 $ (0.263)

Cost per butane sold ($/gallon) (2) $ 1.094 $ 1.440 $ (0.346)

Butane product margin (loss) ($/gallon) (2) $ 0.077 $ (0.006) $ 0.083

Butane inventory (gallons) (1) 17,790 17,409 381

Other products sold (gallons) 277,495 263,422 14,073

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Other products inventory (gallons) (2) 8,556 5,623 2,933

(1) See Adjusted EBITDA definition and reconciliation in “Non-GAAP Financial Measures” section below.

(2) Information is presented as of March 31, 2025 and March 31, 2024, respectively.

(3) Cost and product margin (loss) per gallon excludes the impact of derivatives.

Propane Sales and Cost of Sales-Excluding Impact of Derivatives.

The decreases in sales and cost of sales, excluding the impact of derivatives, were due to lower propane volumes and lower prices during the year ended March 31, 2024.

Propane volumes decreased during the year ended March 31, 2024 due to the sale of three natural gas liquids terminals, the loss of a certain supply contract, lower performing natural gas liquids terminals being idled and a focus on more profitable markets and customers.

Also, demand was lower during the year ended March 31, 2024 due to the warmer than normal winter.

Propane product margins, excluding the impact of derivatives, decreased during the year ended March 31, 2024 primarily due to lower volumes and lower prices.

Propane Derivative Loss.

Our cost of propane sales included $4.6 million of net unrealized gains on derivatives and $7.0 million of net realized losses on derivatives during the year ended March 31, 2024.

During the year ended March 31, 2023, our cost of propane sales included $6.9 million of net unrealized losses on derivatives and $4.7 million of net realized losses on derivatives.

Butane Sales and Cost of Sales-Excluding Impact of Derivatives.

The decreases in sales and cost of sales, excluding the impact of derivatives, were due primarily to lower butane prices.

The decrease was also due to lower volumes during the first six months of the year ended March 31, 2024 as a result of weak spot demand, weak export demand and a change in strategy by a significant customer.

These decreases were partially offset by strong blending demand from October 2023 through February 15, 2024.

Butane product margins, excluding the impact of derivatives, increased during the year ended March 31, 2024, as compared to the year ended March 31, 2023, primarily due to higher demand for butane blending which has tightened up the butane supply, causing sales differentials to increase.

Also, in the prior year, we were negatively impacted by lower location differentials as the product we contracted to purchase in the beginning of the season was continuing to compete with product purchased in the discounted market.

Butane Derivative Loss (Gain).

Our cost of butane sales during the year ended March 31, 2024 included $3.2 million of net unrealized losses on derivatives and $0.5 million of net realized gains on derivatives.

Our cost of butane sales included $3.9 million of net unrealized gains on derivatives and $19.1 million of net realized gains on derivatives during the year ended March 31, 2023.

The increases in sales and cost of sales, excluding the impact of derivatives, were due primarily to higher butane prices during the year ended March 31, 2025.

Propane Sales and Cost of Sales-Excluding Impact of Derivatives.

Propane volumes decreased during the year ended March 31, 2025 due to lower contracted volumes and reduced retail customer demand.

Propane product margins, excluding the impact of derivatives, decreased during the year ended March 31, 2025 primarily due to lower volumes.

For most of the year ended March 31, 2025, we sold higher-priced inventory into a market of declining prices, compared to the year ended March 31, 2024, when we were selling lower-priced inventory into a market with rising prices.

Other Products Sales and Cost of Sales-Excluding Impact of Derivatives.

The decreases in sales and cost of sales, excluding the impact of derivatives, were due primarily to the decrease in market prices during the year ended March 31, 2024 as compared to the year ended March 31, 2023.

The decrease was also the result of lower natural gasoline volumes due to the loss of certain supply contracts.

These decreases were partially offset by increased sales of asphalt due to increased supply.

Other products sales product margins, excluding the impact of derivatives, decreased during the year ended March 31, 2024, mainly due to loss of certain supply contracts for natural gasoline as well as decreased market prices for natural gasoline.

Other Products Derivative Loss.

Our derivatives of other products included $0.1 million of net realized gains on derivatives and $0.1 million of net unrealized losses on derivatives during the year ended March 31, 2024.

Our derivatives of other products during the year ended March 31, 2023 included $1.3 million of net realized losses on derivatives and $0.1 million of net unrealized gains on derivatives.

The increases in sales and cost of sales, excluding the impact of derivatives, were primarily due to an increase in prices and volumes.

Strong spot markets led to an increase in isobutane and natural gasoline sales and asphalt sales increased due to a consistent supply during the year ended March 31, 2025.

Other products sales product margins, excluding the impact of derivatives, increased during the year ended March 31, 2025 due to the increase in volumes and prices, as discussed further above.

Service Sales and Cost of Sales.

The sales include storage, terminaling and transportation services income.

Sales during the year ended March 31, 2024 remained consistent with the year ended March 31, 2023 but cost of sales decreased due to lower third-party costs.

Sales and cost of sales during the year ended March 31, 2025 remained consistent with the year ended March 31, 2024.

Operating and General and Administrative Expenses.

The increase was due to higher incentive compensation due to improved margins in certain of our businesses year over year.

Depreciation and Amortization Expense.

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Loss on Disposal or Impairment of Assets, Net.

During the year ended March 31, 2025, we recorded a net loss of $22.6 million.

The net loss was due to a goodwill impairment loss of $17.9 million in our Wholesale/Terminal reporting unit (see Note 5 to our consolidated financial statements included in this Annual Report).

During the year ended March 31, 2024, we recorded a goodwill impairment loss of $69.2 million in our Wholesale/Terminal reporting unit (see Note 5 to our consolidated financial statements included in this Annual Report).

During the year ended March 31, 2023, we recorded a net loss of $10.1 million due to the impairment of several underperforming natural gas liquids terminals.

In addition, during the year ended March 31, 2023, we recorded a net loss of $0.1 million related to the sale and retirement of other assets.

Corporate and Other

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(in thousands)

Cost of sales:

Derivative (gain) loss $ (937) $ 1,181 $ (2,118)

Service revenues $ 401 $ — $ 401

Cost of sales-derivative gain-unrealized (1) — (1,179) 1,179

Cost of sales-derivative loss-realized (1) — 242 (242)

General and administrative expenses 39,592 105,147 (65,555)

Depreciation and amortization expense 3,027 4,749 (1,722)

Gain on disposal or impairment of assets, net (720) (912) 192

Loss (gain) on disposal or impairment of assets, net 43 (720) 763

Total expenses 42,662 108,239 (65,577)

Operating loss $ (42,261) $ (108,239) $ 65,978

Cost of Sales - Derivative (Gain) Loss.

Our cost of sales during the year ended March 31, 2024 included $0.2 million of net realized losses on derivatives and $1.2 million of net unrealized gains on derivatives.

We entered into economic hedges to protect our liquidity positions and leverage from a significant increase in commodity prices that drive our working capital demands, as we experienced in the prior fiscal year, thus impacting our ability to reduce absolute indebtedness until commodity prices weakened.

Adjusted EBITDA - Continuing Operations (2) $ (38,846) $ (55,068) $ 16,222

(1) We entered into economic hedges to protect our liquidity positions and leverage from a significant increase in commodity prices that drive our working capital demands.

There were no open hedge positions that would impact cost of sales as of March 31, 2025.

(2) See Adjusted EBITDA definition and reconciliation in “Non-GAAP Financial Measures” section below.

Service Revenues.

These revenues relate to billings to the noncontrolling interest holders for usage of the airplanes acquired in June and October 2024.

General and Administrative Expenses .

The increase during the year ended March 31, 2024 relates primarily to the increase in our accrual related to the LCT legal matter from $2.5 million to $36.0 million (see Note 8 to our consolidated financial statements included in this Annual Report), and the write-off of $14.2 million of legal costs related to the LCT legal matter that were originally allocated to the GP.

In addition, we also incurred increased business insurance expense as we paid the insurance company to be released from any future supplementary calls on our indemnity policy related to our former crude marine business (which we sold on March 30, 2023), increased insurance premiums and a reduction in our corporate overhead allocation to the other business segments.

These increases were partially offset by a decrease in equity-based incentive compensation as our final service award vested on November 15, 2023.

The decrease during the year ended March 31, 2025 is primarily due to the increase in our accrual as of March 31, 2024, related to the LCT legal matter (see Note 8 to our consolidated financial statements included in this Annual Report).

Compensation expense was also lower due to the elimination of the equity-based compensation expense due to all outstanding long-term incentive plan awards being fully vested in November 2023.

Depreciation and Amortization Expense.

The decrease during the year ended March 31, 2025 was due to software that became fully depreciated during the year ended March 31, 2024.

Gain on Disposal or Impairment of Assets, Net.

Loss (Gain) on Disposal or Impairment of Assets, Net.

During the year ended March 31, 2025, we recorded a loss of less than $0.1 million due to the write-off of information technology equipment.

During the year ended March 31, 2024, we sold an airplane for a gain of $0.7 million.

During the year ended March 31, 2023, we sold an airplane for a gain of $1.3 million, which was partially offset by a loss recorded to write-off the remaining amount of a loan receivable, due July 31, 2023, that was prepaid by the debtor and an impairment loss recorded on the sublease of a building we were no longer using.

Equity in Earnings of Unconsolidated Entities

Equity in earnings of unconsolidated entities of $4.1 million during the year ended March 31, 2024 consisted primarily of earnings from certain membership interests related to specific land and water services operations and earnings from another entity due to a gain recognized on the sale of an airplane during the three months ended December 31, 2023.

Equity in earnings of unconsolidated entities of $4.1 million during the year ended March 31, 2023 consisted primarily of earnings from certain membership interests related to specific land and water services operations and a loss from our interest in an aircraft company.

Interest Expense

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Senior secured notes $ 182,000 $ 160,088 $ 21,912

Senior unsecured notes 40,829 76,288 (35,459)

ABL Facility 15,645 17,111 (1,466)

2024 Term Loan B 63,118 11,275 51,843

ABL Facility 20,893 15,645 5,248

Senior unsecured notes — 40,829 (40,829)

Other indebtedness 1,630 26,781 (25,151)

1 unchanged sentence

Amortization of debt issuance costs 12,010 15,701 (3,691)

Unrealized gain on interest rate swaps (515) — (515)

Unrealized loss (gain) on interest rate swaps 3,054 (515) 3,569

Realized gain on interest rate swaps (2,627) — (2,627)

Total interest expense $ 280,078 $ 269,804 $ 10,274

The debt interest expense decreased $4.1 million during the year ended March 31, 2024 primarily due to the repurchase of the 7.5% senior unsecured notes due 2023 (“2023 Notes”) throughout the prior year and the redemption of the remaining 2023 Notes on March 31, 2023.

In addition, we repurchased a portion of the outstanding 2025 Notes during the three months ended June 30, 2023.

Also, in the prior year, we had an accrual of the settlement of a claim for the failure to pay interest on royalty payments.

These decreases were partially offset by $26.1 million of interest accrued related to the LCT legal matter (see Note 8 to our consolidated financial statements included in this Annual Report) and an increase due to higher interest rates on the new debt instruments.

(Loss) Gain on Early Extinguishment of Liabilities, Net

Loss on early extinguishment of liabilities, net was $55.3 million during the year ended March 31, 2024, compared to a gain on early extinguishment of liabilities, net of $6.2 million during the year ended March 31, 2023.

During the year ended March 31, 2024, the net loss (inclusive of debt issuance costs written off) primarily relates to the call premium of $38.4 million paid for the early extinguishment of the outstanding 2026 Senior Secured Notes, the write-off of debt issuance costs and other expenses related to the repurchase/redemption of the 2026 Senior Secured Notes and Senior Unsecured Notes during the fiscal year.

During the year ended March 31, 2023, the net gain (inclusive of debt issuance costs written off) primarily related to the early extinguishment of a portion of the outstanding Senior Unsecured Notes partially offset by the write-off of debt issuance costs.

In addition, we paid a prepayment premium of $1.6 million and wrote off debt issuance costs of less than $0.1 million related to the payoff of an outstanding equipment loan.

See Note 7 to our consolidated financial statements included in this Annual Report for a further discussion of the debt instruments repurchased and redeemed.

Other Income, Net

Other income, net of $2.8 million during the year ended March 31, 2024 consisted primarily of interest income on loan receivables (see Note 2 to our consolidated financial statements included in this Annual Report for a further discussion) and cash on hand, income from the settlement of a dispute and income from excess distributions received from an equity method investee.

Other income, net of $30.4 million during the year ended March 31, 2023 consisted primarily of a settlement of a dispute associated with commercial activities not occurring in the current reporting periods (see Note 17 to our consolidated financial statements included in this Annual Report for a further discussion).

Income Tax Expense

Income tax expense was $1.5 million during the year ended March 31, 2024, compared to income tax expense of $0.2 million during the year ended March 31, 2023.

See Note 2 to our consolidated financial statements included in this Annual Report for a further discussion.

Noncontrolling Interests - Redeemable and Nonredeemable

Noncontrolling interest income was $0.6 million during the year ended March 31, 2024, compared to $1.1 million during the year ended March 31, 2023.

The decrease of $0.5 million during the year ended March 31, 2024 was due primarily to lower income from certain water solutions operations during the year ended March 31, 2024.

The debt interest expense increased $13.0 million during the year ended March 31, 2025 primarily due to higher interest rates on the 2024 Term Loan B, the 8.125% senior secured notes due 2029 (“2029 Senior Secured Notes”) and the 8.375% senior secured notes due 2032 (“2032 Senior Secured Notes”).

This was partially offset by the repurchase/redemption of the 6.125% senior unsecured notes due 2025 and the redemption of the 7.5% senior unsecured notes due 2026 (collectively, the “Senior Unsecured Notes”) during the year ended March 31, 2024.

Non-GAAP Financial Measures

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We define Adjusted EBITDA as EBITDA excluding net unrealized gains and losses on derivatives, lower of cost or net realizable value adjustments, gains and losses on disposal or impairment of assets, gains and losses on early extinguishment of liabilities, equity-based compensation expense, revaluation of liabilities and other.

EBITDA and Adjusted EBITDA should not be considered as alternatives to net income (loss), income (loss) from continuing operations before income taxes, cash flows from operating activities, or any other measure of financial performance calculated in accordance with GAAP, as those items are used to measure operating performance, liquidity or the ability to service debt obligations.

EBITDA and Adjusted EBITDA should not be considered as alternatives to net (loss) income, (loss) income from continuing operations before income taxes, cash flows from operating activities, or any other measure of financial performance calculated in accordance with GAAP, as those items are used to measure operating performance, liquidity or the ability to service debt obligations.

We believe that EBITDA provides additional information to investors for evaluating our ability to make quarterly distributions to our unitholders and is presented solely as a supplemental measure.

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Due to the nature of these positions, the cash flow and earnings recognized on a GAAP basis differed from period to period depending on the current crude oil price and future estimated crude oil price which were valued utilizing third-party market quoted prices.

We recognized in Adjusted EBITDA the gains and losses from the derivative instrument positions entered into in January 2021 to properly align with the physical margin we hedged each month through the term of this transaction.

We recognized in Adjusted EBITDA the gains and losses from the derivative instrument positions entered into in January 2021 to

properly align with the physical margin we hedged each month through the term of this transaction.

This representation aligns with management’s evaluation of the transaction.

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This change aligns with how management now views and evaluates the transactions within these businesses and is also consistent with the calculation of Adjusted EBITDA used in our other businesses.

If this change was made as of April 1, 2022, Adjusted EBITDA for the years ended March 31, 2023 and 2024 would have been $638.8 million and $609.5 million, respectively.

The following table reconciles net income (loss) to EBITDA and Adjusted EBITDA for the periods indicated:

If this change was made as of April 1, 2023, Adjusted EBITDA for the year ended March 31, 2024 would have been $609.5 million.

The following table reconciles net (loss) income to EBITDA and Adjusted EBITDA for the periods indicated:

Year Ended March 31,

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(in thousands)

Net income (loss) $ 43,163 $ (143,124) $ 52,492

Net (loss) income $ (139,163) $ 43,163 $ (143,124)

Net income from continuing operations attributable to nonredeemable noncontrolling interests (3,376) (3,749) (631)

Net income from continuing operations attributable to redeemable noncontrolling interests (46) — —

Net income (loss) attributable to NGL Energy Partners LP 39,368 (143,755) 51,386

Net loss (income) from continuing operations attributable to redeemable noncontrolling interests 244 (46) —

Net (loss) income attributable to NGL Energy Partners LP (142,295) 39,368 (143,755)

Interest expense 257,406 280,241 270,004

2 unchanged sentences

EBITDA 368,114 568,024 394,941

Net unrealized losses (gains) on derivatives 21,782 63,762 (50,438)

Net unrealized losses on derivatives (1) 36,462 21,782 63,762

Lower of cost or net realizable value adjustments (2) (2,890) (1,619) 1,337

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Revaluation of liabilities 4,415 (6,705) 2,680

Loss on early extinguishment of liabilities, net 16,749 — 55,281

Equity-based compensation expense 11,206 — 1,098

CMA Differential Roll net losses (gains) (4) — — (71,285)

Inventory valuation adjustment (5) — — (3,419)

Loss (gain) on early extinguishment of liabilities, net — 55,281 (6,177)

Equity-based compensation expense — 1,098 2,718

Other (6) 9,238 2,572 50,131

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Adjusted EBITDA - Continuing Operations $ 660,203 $ 622,892 $ 593,414

(1) Due to the conflict between the United States and Iran, crude oil prices increased significantly during the month of March 2026.

To better match the movement of inventory and derivative losses with the physical gains recognized by our Crude Oil Logistics segment in March 2026 and April 2026 and to align with how management evaluated these transactions, approximately $4.0 million of losses from settled contracts are included within this amount.

(2) Lower of cost or net realizable value adjustments in the table above differ from lower of cost or net realizable value adjustments reported in our consolidated statements of cash flows, as the amounts reported in the table above represent the change in lower of cost or net realizable value adjustments recorded in the consolidated statements of operations, which includes reversals, whereas the amounts reported in our consolidated statements of cash flows represent the lower of cost or net realizable value adjustments recorded at the balance sheet date.

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See “Non-GAAP Financial Measures” section above for a further discussion.

(5) Amounts represent accretion expense for asset retirement obligations, unrealized gains and losses on investments and marketable securities and expenses incurred related to legal and advisory costs associated with acquisitions and dispositions, including the accrued judgment related to the LCT legal matter, excluding interest (see Note 8 to our consolidated financial statements included in this Annual Report), and the write-off of the legal costs related to the LCT legal matter that were originally allocated to the GP.

Also, the amount for the year ended March 31, 2023 includes the write off of an asset acquired in a prior period acquisition and non-cash operating expenses related to our Grand Mesa Pipeline.

(6) Amounts represent accretion expense for asset retirement obligations, unrealized gains and losses on investments and marketable securities, a loss from a legal dispute and expenses incurred related to legal and advisory costs associated with acquisitions and dispositions, including the accrued judgment related to the LCT legal matter, excluding interest (see Note 8 to our consolidated financial statements included in this Annual Report), and the write-off of the legal costs related to the LCT legal matter that were originally allocated to the GP.

For the year ended March 31, 2026, the amount includes the difference in value recorded to cost of sales-product related to the misclassification of line fill within inventories (see Note 2 to our consolidated financial statements included in this Annual Report).

(7) Amounts include our refined products and biodiesel businesses.

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Depreciation and amortization per EBITDA table $ 253,263 $ 253,190 $ 266,287

Intangible asset amortization recorded to cost of sales (257) — (14)

Intangible asset amortization recorded to cost of sales-service (1,068) — —

Intangible asset amortization recorded to cost of sales-product — (257) —

Depreciation and amortization attributable to unconsolidated entities (24) (426) (686)

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Depreciation and amortization per consolidated statements of cash flows $ 268,728 $ 267,246 $ 282,062

The following table reconciles interest expense per the EBITDA table above to interest expense reported in our consolidated statements of operations for the periods indicated:

Year Ended March 31,

2025 2024 2023

(in thousands)

Interest expense per EBITDA table $ 280,241 $ 270,004 $ 275,505

Interest expense attributable to noncontrolling interests 63 — —

Interest expense attributable to unconsolidated entities (1) (81) (60)

Interest expense attributable to discontinued operations (225) (119) (7)

Interest expense per consolidated statements of operations $ 280,078 $ 269,804 $ 275,438

The following table summarizes additional amounts attributable to discontinued operations in the EBITDA and Adjusted EBITDA table above for the periods indicated:

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Income tax expense $ 16 $ 110 $ 947

Net unrealized losses on derivatives $ 18,416 $ — $ —

Net unrealized (gains) losses on derivatives $ (16) $ 18,416 $ —

Lower of cost or realizable value adjustments $ — $ (4,535) $ 3,745

Loss on disposal or impairment of assets, net $ 1,995 $ — $ 112

(Gain) loss on disposal or impairment of assets, net $ (38,290) $ 1,995 $ —

Inventory valuation adjustment $ — $ — $ (3,419)

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Depreciation and amortization 221,048 24,331 6,201 3,251 254,831 — 254,831

Amortization recorded to cost of sales — — 257 — 257 — 257

Net unrealized losses (gains) on derivatives 4,953 (4,011) 2,424 — 3,366 — 3,366

Amortization in cost of sales-service 1,068 — — — 1,068 — 1,068

Net unrealized losses on derivatives 21,573 5,604 9,301 — 36,478 — 36,478

Lower of cost or net realizable value adjustments — — (2,890) — (2,890) — (2,890)

Loss (gain) on disposal or impairment of assets, net 20,114 251,761 (15,551) (2) 256,322 — 256,322

Other income, net 485 1 1,518 2,258 4,262 — 4,262

Equity-based compensation expense — — — 11,206 11,206 — 11,206

Other income (expense), net 4,352 (873) (284) (2,669) 526 — 526

Adjusted EBITDA attributable to unconsolidated entities 221 — 4 — 225 — 225

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Depreciation and amortization 217,227 25,070 9,408 3,027 254,732 — 254,732

Amortization in cost of sales-product — — 257 — 257 — 257

Net unrealized losses (gains) on derivatives 4,953 (4,011) 2,424 — 3,366 — 3,366

CMA Differential Roll net losses (gains) — (71,285) — — (71,285) — (71,285)

Lower of cost or net realizable value adjustments — — 2,916 — 2,916 — 2,916

Loss (gain) on disposal or impairment of assets, net 9,813 (1,004) 22,596 43 31,448 — 31,448

Equity-based compensation expense — — — 1,098 1,098 — 1,098

Other income, net 485 1 1,518 2,258 4,262 — 4,262

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Depreciation and amortization 214,480 36,922 9,963 4,749 266,114 — 266,114

Amortization recorded to cost of sales — — 14 — 14 — 14

Net unrealized (gains) losses on derivatives (4,464) (50,104) 2,951 1,179 (50,438) — (50,438)

Net unrealized losses (gains) on derivatives 385 65,786 (1,230) (1,179) 63,762 — 63,762

CMA Differential Roll net losses (gains) — (71,285) — — (71,285) — (71,285)

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Equity-based compensation expense — — — 1,098 1,098 — 1,098

Other income (expense), net 70 330 (3) 30,013 30,410 — 30,410

Other income, net 1,110 105 1 1,566 2,782 — 2,782

Adjusted EBITDA attributable to unconsolidated entities 4,393 — (12) 124 4,505 — 4,505

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To protect our liquidity and leverage, we have in the past and may in the future enter into economic hedges that mitigate this exposure when we are building inventory.

There were no open hedge positions as of March 31, 2025.

There were no open financial derivative contracts for the purpose of an economic hedge of our physical inventory volumes as of March 31, 2026.

Cash Management

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Our principal sources of short-term liquidity consist of cash flows from our operations and borrowings under the ABL Facility, which we believe will provide liquidity to operate our business, manage our working capital requirements and repay current maturities.

On February 2, 2024, we amended the ABL Facility to, among other things, (i) extend the maturity to the earliest of (a) February 2, 2029 and (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, subject to certain exceptions, (ii) provide for a sub-limit of $200.0 million for letters of credit and a $200.0 million incremental facility, subject to the receipt of commitments from lenders and customary borrowing conditions, (iii) modify the applicable margin for loans under the ABL Facility based on a secured overnight financing rate (“SOFR”) or the alternative base rate to provide for a 0.25% decrease based on our consolidated net leverage ratio, and (iv) provide for a mandatory prepayment under the ABL Facility while any loans are outstanding under the ABL Facility if aggregate “excess cash” (as defined in the ABL Facility) exceeds $50.0 million, subject to certain exceptions.

Total commitments under the ABL Facility are $550.0 million.

On March 12, 2026, we amended the ABL Facility to (i) reduce our total commitments to $425.0 million, (ii) reduce our sub-limit for letters of credit to $100.0 million, (iii) reduce the applicable margin for alternate base rate loans to a range of 1.00% to 1.50% and (iv) reduce the applicable margin for secured overnight financing rate (“SOFR”) to a range of 2.00% to 2.50%.

At March 31, 2026, $135.0 million was outstanding under the ABL Facility, letters of credit outstanding were $60.6 million, and we had a borrowing base of $388.7 million.

The ABL Facility is scheduled to mature at the earliest of (a) February 2, 2029, 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, subject to certain exceptions.

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

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Interest on the 2029 Senior Secured Notes and 2032 Senior Secured Notes is payable on February 15, May 15, August 15 and November 15 of each year.

On February 2, 2024, we entered into a new seven-year $700.0 million Term Loan B.

The Term Loan B matures on February 2, 2031 and will amortize in equal quarterly installments in aggregate annual amounts equal to 1.0% of the original principal amount, with the balance payable on maturity.

2026 Term Loan B

On March 12, 2026, we entered into a new seven-year $950.0 million 2026 Term Loan B.

The 2026 Term Loan B matures on March 11, 2033 and will amortize in equal quarterly installments in aggregate annual amounts equal to 1.0% of the original principal amount, with the balance payable on maturity.

The amount outstanding at March 31, 2026 is $950.0 million.

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Capital Expenditures, Acquisitions and Other Investments

The following table summarizes expansion, maintenance and other non-cash capital expenditures (which excludes additions for tank bottoms and linefill and has been prepared on the accrual basis), acquisitions and other investments for the periods indicated.

Capital Expenditures Other

Year Ended March 31, Expansion Maintenance Other (1) Acquisitions (2) Investments (3)

Year Ended March 31, Expansion Maintenance Other (1) Investments (2)

(in thousands)

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(1) Amount for the year ended March 31, 2025 is related to a transaction classified as an acquisition of assets in a prior period.

Amount for the year ended March 31, 2024 includes $9.2 million of equipment and other assets received in connection with contracts with customers

and $6.4 million for a transaction classified as an acquisition of assets.

Amount for the year ended March 31, 2024 includes $9.2 million of equipment and other assets received in connection with contracts with customers and $6.4 million for a transaction classified as an acquisition of assets.

See Note 17 to our consolidated financial statements included in this Annual Report for information regarding the acquisition of assets.

(2) There were no acquisitions during the years ended March 31, 2025, 2024 or 2023.

(2) Amounts relate to contributions made to unconsolidated entities.

Capital expenditures for the year ending March 31, 2026 are expected to be approximately $105 million.

There were no acquisitions during the years ended March 31, 2026, 2025 or 2024.

Capital expenditures for the year ending March 31, 2027 are expected to be approximately $200 million for growth and $45 million for maintenance.

Distributions Declared

On March 18, 2026, the board of directors of our GP declared a cash distribution for the quarter ended March 31, 2026 to the holders of the Class B Fixed-to-Floating Rate Cumulative Redeemable Perpetual Preferred Units (“Class B Preferred Units”), the Class C Fixed-to-Floating Rate Cumulative Redeemable Perpetual Preferred Units (“Class C Preferred Units”) and the Class D Preferred Units (“Class D Preferred Units”).

The total distribution of $29.8 million was made on April 15, 2025 to the holder of record at the close of trading on April 1, 2025.

The total distribution of $18.8 million was made on April 15, 2026 to the holders of record at the close of trading on April 1, 2026.

The board of directors of our GP expects to evaluate the reinstatement of the common unit distributions in due course, taking into account a number of important factors, including our leverage, liquidity, the sustainability of cash flows, upcoming debt maturities, capital expenditures and the overall performance of our businesses.

See further discussion of our cash distribution policy in Part II, Item 5–“Market for Registrant’s Common Equity, Related Unitholder Matters and Issuer Purchases of Equity Securities” included in this Annual Report.

For further discussion of the distributions, see Note 9 to our consolidated financial statements included in this Annual Report.

For additional information related to the payment of distributions, see Note 9 to our consolidated financial statements included in this Annual Report.

Contractual Obligations

Our contractual obligations primarily consist of purchase commitments, outstanding debt principal and interest obligations, operating lease obligations, asset retirement obligations and other commitments.

The amounts below do not include obligations related to liabilities classified as either held for sale or discontinued operations within our March 31, 2025 and 2024 consolidated balance sheets (see Note 18 to our consolidated financial statements included in this Annual Report).

Our contractual obligations primarily consist of purchase commitments, outstanding debt principal and interest obligations, operating lease obligations, finance lease obligations, asset retirement obligations and other commitments.

Purchase Commitments

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Debt Principal and Interest Obligations

As of March 31, 2025, our aggregate principal amount of outstanding debt was $3.0 billion, with $8.8 million due within one year.

As of March 31, 2026, our outstanding long-term debt was $3.3 billion, with $11.5 million due within one year.

Our interest obligation on the debt was $1.3 billion, with $250.0 million due within one year, based on our outstanding balances and interest rates as of March 31, 2026.

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See Note 15 to our consolidated financial statements included in this Annual Report for information regarding our lease obligations and timing of our expected lease payments.

Finance Lease Obligations

As of March 31, 2026, our undiscounted finance lease obligation was $8.0 million, with $3.2 million due within one year.

See Note 15 to our consolidated financial statements included in this Annual Report for information regarding our lease obligations and timing of our expected lease payments.

Asset Retirement Obligations

We have contractual and regulatory obligations at certain facilities for which we have to perform remediation, dismantlement or removal activities when the assets are retired.

As of March 31, 2025, our asset retirement obligations were $69.6 million, of which we expect to settle $2.5 million during fiscal year 2026.

As of March 31, 2026, our asset retirement obligations were $76.3 million and we do not expect to settle any asset retirement obligations during fiscal year 2027.

See Note 8 to our consolidated financial statements included in this Annual Report for information regarding our asset retirement obligations.

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Net cash provided by operating activities-continuing operations Operating $ 350,317 $ 256,850 $ 361,818

Net proceeds from borrowings under ABL Facility (see Note 7)

Issuance of secured debt (see Note 7)

Financing 945,286 — 2,894,873

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Investing 72,672 42,819 53,246

Proceeds from borrowings on other long-term debt (see Note 7)

Net proceeds from borrowings under ABL Facility (see Note 7)

Financing 26,000 109,000 —

Issuance of secured debt (see Note 7)

Proceeds from borrowings on other long-term debt (see Note 7)

Financing — 12,720 —

Net settlements of derivatives (see Note 10)

Investing — — 56,005

Uses of cash and cash equivalents:

Distributions to preferred unitholders (see Note 9)

Payments on 2024 Term Loan B (see Note 7)

Financing (693,000) (7,000) —

Class D preferred unit repurchases (see Note 9)

Financing (422,502) — —

Capital expenditures (see Note 11)

Investing (221,278) (245,816) (152,295)

Payments on Term Loan B (see Note 7)

Distributions to preferred unitholders (see Note 9)

Financing (113,486) (305,291) (178,299)

Warrant repurchases (see Note 9)

Common unit repurchases and cancellations (see Note 9)

Financing (47,649) (2,126) (84)

Net settlements of derivatives (see Note 10)

Investing (24,226) (246) (6,185)

Debt issuance costs (see Note 6 and Note 7)

Financing (17,955) (5,258) (53,170)

Repayment and repurchase of senior notes (see Note 7)

Financing (17,274) — (2,781,067)

Payments on other long-term debt (see Note 7)

Financing (1,805) (1,068) —

Net settlements of derivatives (see Note 10)

Investing (246) (6,185) —

Repayment and repurchase of Senior Unsecured Notes (see Note 7)

Warrant repurchases (see Note 9)

Financing — (6,929) —

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Operating Activities-Continuing Operations.

The increase in net cash provided by operating activities during the year ended March 31, 2026 was due primarily to higher earnings from operations (excluding non-cash items) and fluctuations in working capital, particularly accounts receivable and accounts payable, due to higher crude oil volumes and lower crude oil prices, lower purchases and sales of natural gas liquids due to the Wholesale Propane Disposition and the timing of invoices and payments on construction projects.

The decrease in net cash provided by operating activities during the year ended March 31, 2025 was due primarily to fluctuations in working capital, particularly accounts receivable and accounts payable, due to lower crude oil volumes and lower crude oil prices and the timing of invoices and payments on construction projects, partially offset by higher earnings from operations.

Also, on June 13, 2024, we paid LCT $63.3 million related to the legal judgment against us, of which $27.2 million represented interest and $0.1 million of costs awarded to LCT (see Note 8 to our consolidated financial statements included in this Annual Report).

The increase in net cash provided by operating activities during the year ended March 31, 2024 was due primarily to fluctuations in working capital, particularly accounts receivable and accounts payable, due to open derivative positions, partially offset by lower crude oil volumes and prices, lower inventory due to decreased sales and purchases of natural gas liquids, and decreased earnings from operations.

Also, on June 13, 2024, we paid LCT $63.3 million related to the legal judgment

against us, of which $27.2 million represented interest and $0.1 million of costs awarded to LCT (see Note 8 to our consolidated financial statements included in this Annual Report).

Environmental Legislation

See Part I, Item 1–“Business–Government Regulation–Greenhouse Gas Regulation” for a discussion of proposed environmental legislation and regulations that, if enacted, could result in increased compliance and operating costs.

this time we cannot predict the structure or outcome of any future legislation or regulations or the eventual cost we could incur in compliance.

However, at this time we cannot predict the structure or outcome of any future legislation or regulations or the eventual cost we could incur in compliance.

Recent Accounting Pronouncements

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If future results are not consistent with our estimates, we could be exposed to future impairment losses that could be material to our results of operations.

During the years ended March 31, 2025 and 2024, we recorded goodwill impairments of $17.9 million and $69.2 million, respectively.

We did not record a goodwill impairment during the year ended March 31, 2023.

During the years ended March 31, 2026, 2025 and 2024, we recorded goodwill impairments of $247.8 million, $17.9 million and $69.2 million, respectively.

See Note 5 to our consolidated financial statements included in this Annual Report for a further discussion of our goodwill impairment assessment.

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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.

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.

If future results are not consistent with our estimates, we could be exposed to future impairment losses that could be material to our results of operations.

See Note 4 and Note 6 to our consolidated financial statements included in this Annual Report for a further discussion of our impairments of long-lived assets.

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.

Depreciation and Amortization Methods and Estimated Useful Lives of Property, Plant and Equipment and Intangible Assets

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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.

All changes in the fair value of our physical contracts that do not qualify as normal purchases and normal sales and settlements (whether cash transactions or non-cash mark-to-market adjustments) are reported either within revenue (for sales contracts) or cost of sales (for purchase contracts) in our consolidated statements of operations, regardless of whether the contract is physically or financially settled, and within cash flows from operations in our consolidated statements of cash flows.

All changes in the fair value of our physical contracts that do not qualify as normal purchases and normal sales and settlements (whether cash transactions or non-cash mark-to-market adjustments) are reported within cost of sales-product (for purchase contracts) in our consolidated statements of operations, regardless of whether the contract is physically or financially settled, and within cash flows from operations in our consolidated statements of cash flows.

The change in the fair value of our interest rate swaps is recorded as a net gain or loss within interest expense in our consolidated statement of operations and within cash flows from operations in our consolidated statements of cash flows.

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We are required to recognize the fair value of a liability for an asset retirement obligation if a reasonable estimate of fair value can be made.

In order to determine the fair value of such a liability, we must make certain estimates and assumptions including, among other things, projected cash flows,

the estimated timing of retirement, a credit-adjusted risk-free interest rate, and an assessment of market conditions, which could significantly impact the estimated fair value of the asset retirement obligation.

In order to determine the fair

value of such a liability, we must make certain estimates and assumptions including, among other things, projected cash flows, the estimated timing of retirement, a credit-adjusted risk-free interest rate, and an assessment of market conditions, which could significantly impact the estimated fair value of the asset retirement obligation.

Most of these asset retirement obligations are many years, or decades, in the future and the contracts and regulations often have vague descriptions of what removal practices and criteria must be met when the removal event actually occurs.

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Our inventories consist of crude oil and natural gas liquids.

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.

Our inventories are valued at the lower of cost or net realizable value, with cost determined using the weighted average cost method, 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.

In performing this analysis, we consider fixed-price forward commitments.

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

What changed 10-K

Item 7. Management’s Discussion and Analysis