Sunoco 2015 Annual Report Download - page 55

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Natural Gas Liquids
Our Natural Gas Liquids segment transports, stores, and executes acquisition and marketing activities utilizing an
integrated network of pipeline assets in the northeast and southwest United States, storage and blending facilities, and strategic
off-take locations that provide access to multiple NGL markets. Revenues are generated from tariffs and the associated fees paid
by shippers utilizing our pipeline assets, fees for terminalling services provided, and the marketing of NGLs. Rates for shipments
on the NGLs pipelines are regulated by the FERC and other state and Canadian regulatory agencies, as applicable.
The following table presents the operating results and key operating measures for our Natural Gas Liquids segment for the
periods presented:
Year Ended December 31,
2015 2014 2013
(in millions, except for barrel amounts)
Sales and other operating revenue
Unaffiliated customers $ 961 $ 825 $ 384
Affiliates 204 134 63
Total sales and other operating revenue $ 1,165 $ 959 $ 447
Depreciation and amortization expense $ 76 $ 30 $ 21
Impairment charge and other matters (1) $ 10 $ 27 $ —
Adjusted EBITDA $ 333 $ 203 $ 73
Pipeline throughput (thousands of bpd) 209 33 9
Terminal throughput (thousands of bpd) 184 40 31
Gross profit (2) $ 348 $ 248 $ 84
(1) Represents non-cash inventory adjustments related to changes in commodity prices.
(2) Represents total segment sales and other operating revenue less costs of products sold and operating expenses.
Adjusted EBITDA for the Natural Gas Liquids segment increased $130 million to $333 million for the year ended
December 31, 2015 compared to the prior year period. The increase in Adjusted EBITDA was due primarily to contributions
from our Mariner NGLs projects which commenced operations in late 2014 and 2013. These projects contributed to improved
results related to our NGLs pipeline and terminal operations ($160 million), including our Nederland and Marcus Hook facilities.
These positive impacts were partially offset by lower results from our NGLs acquisition and marketing activities ($33 million)
driven largely by narrowed blending margins compared to the prior year period.
Adjusted EBITDA for the Natural Gas Liquids segment increased $130 million to $203 million for the year ended
December 31, 2014 compared to the prior year period. The increase in Adjusted EBITDA was attributable to improved results
from our NGLs acquisition and marketing activities ($101 million) driven by higher volumes which benefited from a full year of
results from the Marcus Hook Industrial Complex, increased margins, and favorable inventory timing compared to the prior year
period. Higher contributions from our NGLs pipelines ($38 million) were largely driven by our Mariner West project which
commenced operations in late 2013. NGLs terminalling activities at our Marcus Hook Industrial Complex ($8 million) also
contributed to the increase. These positive impacts were partially offset by increased selling, general and administrative expenses
($16 million) attributable to growth projects.