Ngl Energy Partners Lp's Business Segments

We are a Delaware limited partnership formed in September 2010. Subsequent to our initial public offering (“IPO”) in May 2011, we significantly expanded our operations through numerous acquisitions. Our operations include:

Our Crude Oil Logistics segment purchases crude oil from producers and transports it to refineries or for resale at pipeline injection stations, storage terminals, barge loading facilities, rail facilities, refineries, and other trade hubs.

Our Water Solutions segment provides services for the treatment and disposal of wastewater generated from crude oil and natural gas production and for the disposal of solids such as tank bottoms and drilling fluids and performs truck and frac tank washouts. In addition, our Water Solutions segment sells the recovered hydrocarbons that result from performing these services.

Our Liquids segment supplies natural gas liquids to retailers, wholesalers, refiners, and petrochemical plants throughout the United States and in Canada using its leased underground storage and fleet of leased railcars, markets regionally through its 21 owned terminals throughout the United States, and provides terminaling and storage services at its salt dome storage facility in Utah.

Our Retail Propane segment sells propane, distillates, equipment and supplies to end users consisting of residential, agricultural, commercial, and industrial customers and to certain resellers in 30 states and the District of Columbia.

Our Refined Products and Renewables segment conducts gasoline, diesel, ethanol, and biodiesel marketing operations, purchases refined petroleum and renewable products primarily in the Gulf Coast, Southeast and Midwest regions of the United States and schedules them for delivery at various locations throughout the country.

NGL Energy Partners LP operates a diverse range of segments within the energy logistics and distribution sector, primarily focusing on crude oil logistics, retail propane, and liquids services. Below is an extensive overview of each segment, including their operations, products, customer base, and key assets.

Crude Oil Logistics

Overview:
The Crude Oil Logistics segment handles the procurement, transportation, and storage of crude oil sourced from producers. NGL Energy Partners LP ensures that crude oil is efficiently moved to refineries or resale locations, such as pipeline injection stations, storage terminals, barge loading facilities, rail facilities, and other trade hubs. This segment also offers leasing options for its storage tanks, pipelines, trucks, barges, and railcars to third parties for a fee.

Key Operations:
- Geographical Focus: The operations are strategically located near significant crude oil production areas, including:
- Bakken Shale Play (North Dakota)
- DJ Basin (Colorado)
- Permian Basin (Texas and New Mexico)
- Eagle Ford Shale Play (Texas)
- Anadarko Basin (including STACK, SCOOP, Granite Wash, and Mississippi Lime plays in Oklahoma and Texas)
- Southern Louisiana near the Gulf of Mexico

- Pipeline Infrastructure:
- NGL Energy Partners LP owns and operates the Grand Mesa Pipeline, a significant 550-mile pipeline that transports crude oil from Colorado to Cushing, Oklahoma. This pipeline began operations on November 1, 2016, and includes a 35% interest held in partnership with Saddlehorn Pipeline Company LLC.
- The capacity for the Grand Mesa Pipeline is projected at 150,000 barrels per day, with around 42,000 barrels per day transported in its initial operational phase.
- The company also maintains 970,000 barrels of operational tankage to support its logistics activities.

Retail Propane

Overview:
The Retail Propane segment focuses on marketing, selling, and distributing propane and distillates to a wide range of customers. These customers include residential, agricultural, commercial, and industrial sectors. The segment also involves the sale and lease of propane-related equipment and supplies.

Key Operations:
- Customer Base: Over 350,000 customers predominantly located in rural regions but extending into suburban markets where alternatives to propane, like natural gas, are not readily available.
- Service Infrastructure:
- The company manages a network of 128 customer service locations and 119 satellite distribution locations, providing a combined propane storage capacity of 15 million gallons and distillate storage capacity of6 million gallons.
- Customer service locations serve specific geographical markets, featuring operational offices, product showrooms, and storage capabilities.
- Satellite distribution locations allow for efficient outreach to broader market areas while being unmanned to streamline operations.

- Supply Chain Integration: A significant portion of propane is sourced from the company’s own Liquids segment, ensuring a stable and reliable supply chain for retail operations.

Liquids

Overview:
The Liquids segment specializes in the procurement, storage, transportation, and supply of natural gas liquids (NGLs) to various customers, leveraging both owned and third-party assets. This segment plays a crucial role in supporting the other segments, particularly the Retail Propane segment.

Key Operations:
- Products Offered: This segment handles a spectrum of natural gas liquids, including butanes and natural gasolines, which serve as critical blending stocks and diluents for refiners and producers.
- Volume Statistics: For the year ending March 31, 2017, the Liquids segment reported sales of approximately1 billion gallons of natural gas liquids, averaging about66 million gallons per day.

- Procurement and Service Delivery:
- NGL Energy Partners LP procures NGLs from a range of sources, including refiners, gas processing facilities, producers, and resellers.
- Delivery of these liquids is facilitated through leased and owned storage facilities, common carrier pipelines, railcar terminals, and direct delivery to specific customers.
- A portion of wholesale propane is managed through back-to-back contracts with third-party retailers and wholesalers, providing price stability and mitigating commodity price risks.

Overall, NGL Energy Partners LP’s diverse offerings in crude oil logistics, retail propane, and liquids management underline its significant role in the energy sector, serving a broad array of customers with critical energy products and services across the United States.