GENESIS ENERGY LP
For the period ended Dec 31, 2024. Filed Mar 3, 2025.
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A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2024 · Filed Mar 3, 2025
GEL$12.86+3.0%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-K
Period ended 2023-12-31; filed 2024-02-23.
0001022321-24-000018
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-K
Period ended 2024-12-31; filed 2025-03-03.
0001022321-25-000023
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 246 previous paragraphs and 248 current paragraphs.
152 unchanged; 67 reworded; 23 added; 26 removed; 1 previous and 6 current paragraphs rearranged.
Tables are not compared: 17 previous and 17 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (23)
Current report
•The completion of our current major growth capital spending program in the first half of 2025, including our SYNC Pipeline and the expansion of our existing CHOPS Pipeline, combined with our recent evaluation and initiative to look for efficiencies and cost savings throughout our businesses. These strategies will allow us to maximize our cash flow after our existing cash obligations and focus on returning value to our capital structure.
Current report
Sale of our Alkali Business
Current report
On February 28, 2025 we completed the sale of our Alkali Business to an indirect affiliate of WE Soda Ltd. for a gross purchase price of $1.425 billion. We received cash of approximately $1.039 billion, which reflects the net proceeds after the assumption of our outstanding Alkali senior secured notes by an indirect affiliate of WE Soda Ltd, amongst other purchase price adjustments. We used a portion of the cash proceeds to pay down the outstanding balance on our senior secured credit facility on February 28, 2025, and anticipate using the remaining cash proceeds to redeem a portion of our outstanding senior unsecured notes, repurchase certain of our outstanding Class A convertible preferred units, and for general partnership purposes.
Current report
The CHOPS expansion includes a complete overhaul of the GB-72 topside facilities, reconnection of the CHOPS Pipeline to the GB-72 platform, and the addition of pumps at both the HI-A5 and GB-72 platforms to upgrade processing capabilities and increase throughput. As of December 31, 2024, we successfully completed the overhaul of the GB-72 topside facility and re-connected the CHOPS pipeline to the platform during the fourth quarter. We expect to complete the remainder of the project, including the addition of the pumps, during the first half of 2025.
Current report
We have successfully laid the 105 miles of SYNC Pipeline and plan to connect it to the Shenandoah FPS when it arrives to its final location in the Gulf of America in the first half of 2025.
Current report
In addition to our Alkali Business and our crude oil marketing business discussed above, we continue to operate in our other core businesses including: (i) our offshore Gulf of America crude oil and natural gas pipeline transportation and handling operations; (ii) our sulfur services business, which we believe is one of the largest producers and marketers (based on tons produced) of NaHS in North and South America; and (iii) our onshore-based refinery-centric operations (including the operations in both our onshore facilities and transportation and marine transportation segments) which focus on providing a suite of services primarily to refiners.
Current report
In our sulfur services business, our revenues and costs can be affected by the price movements in both caustic soda and NaHS. Average index prices for caustic soda decreased to $508 per dry short ton (“DST”) during 2024 compared to $1,057 per DST during 2023 primarily due to a downward non-market adjustment of $425 per DST to previously posted U.S. Caustic Soda Index prices (Source: IHS Chemical). Typically, changes in caustic soda prices do not materially affect Net income (loss), Segment Margin, or Available Cash before Reserves as the pricing in many of our sales contracts for NaHS typically includes adjustments for fluctuations in commodity benchmarks (primarily caustic soda), freight, labor, energy costs and government indexes. The frequency at which those adjustments are applied varies by contract, geographic region and supply point. The mix of NaHS sales volumes to which we are able to apply such adjustments may vary due to timing or other factors such as competitive pressures. To the extent we are unable to pass these caustic soda price changes onto our customers, our results may be impacted.
Current report
Offshore pipeline transportation Segment Margin for 2024 decreased $73.9 million, or 18%, from 2023, primarily due to: (i) an economic step-down in the rate on a certain existing life-of-lease transportation dedication; (ii) producer underperformance at several of our major host platforms; and (iii) an increase in operating costs. At the beginning of the third quarter of 2024, we reached the 10-year anniversary of a certain existing life-of-lease dedication, which resulted in the contractual economic step-down of the associated transportation rate. Additionally, during the second half of 2024, there was an increase in producer downtime as a result of several wells being shut in due to certain sub-sea operational and technical challenges. The production from these wells impacted our results as they are molecules that we touch multiple times throughout our oil and natural gas pipeline infrastructure. A small portion of the impacted volumes have been remedied to date and we anticipate the remaining issues will be remediated at some point during 2025 based on discussions with the impacted producers. Outside of these issues, activity in and around our Gulf of America asset base continues to be robust, including incremental in-field drilling at existing fields that tie into our infrastructure. This activity is evidenced by projects such as the Warrior and Winterfell projects, which produced first oil in late June 2024 and early July 2024, respectively, and the Monument development which is currently expected to come on-line in mid to late 2026.
Current report
In our Alkali Business, 2024 was significantly impacted by a decline in export pricing as compared to 2023 as global supply has continued to outpace demand in most markets. Additionally, 2024 was negatively impacted by temporary operational issues at our facilities that led to lower than expected production volumes and overall reduced operating efficiencies as a result of a higher per unit production cost and higher maintenance spending in the year. This was slightly offset by higher soda ash sales volumes during 2024 as a result of our expanded Granger facility coming online in the fourth quarter of 2023, which ramped up to levels near its original nameplate production capacity of approximately 100,000 tons per month during 2024.
Current report
In our sulfur services business, we continued to face challenges on the production side at our largest host refinery as well as continued pressures on demand in South America, including competitive pressures from Chinese flake, which had a negative impact on pricing during 2024.
Current report
Total general and administrative expenses decreased $6.3 million between 2024 and 2023. The decrease is primarily due to the assumptions used to value the outstanding awards under our long-term incentive compensation plan during 2024 as compared to 2023. This decrease was partially offset by higher corporate general and administrative expenses as a result of us conforming our short-term cash incentive programs to industry standards during 2024.
Current report
Impairment expense
Current report
In the fourth quarter of 2024, we terminated an on-going project related to the integration of certain of our corporate enterprise resource planning systems and we impaired the costs incurred to date. As a result, we recognized an impairment charge of $43.0 million. We did not record an impairment expense for the year ended December 31, 2023.
Current report
Net loss for the year ended December 31, 2024 included a net loss of $15.4 million associated with the following: (i) a net loss of $14.0 million associated with the tender fee and write-off of the related unamortized debt issuance costs and premium on our 2027 Notes that were tendered and redeemed; and (ii) a loss of $1.4 million from the write-off of the unamortized issuance costs associated with our 2026 Notes. These amounts are included within “Other expense, net” on the Consolidated Statement of Operations.
Current report
(4)Represents Select Items applicable to Adjusted EBITDA and Available Cash before Reserves.
Current report
On July 19, 2024, we entered into the Seventh Amended and Restated Credit Agreement to replace our Sixth Amended and Restated Credit Agreement, which provides for a $900 million senior secured revolving credit facility and matures on September 1, 2028, subject to extension at our request for one additional year on up to two occasions and subject to certain conditions, unless: (i) if more than $150 million of our 2027 Notes remain outstanding as of October 16, 2026, the credit agreement matures on such date; and (ii) if more than $150 million of our 2028 Notes remain outstanding as of November 2, 2027, the credit agreement matures on such date.
Current report
On December 11, 2024 we entered into the First Amendment to the Seventh Amended and Restated Credit Agreement (as amended, the “credit agreement”), which resulted in several changes to the credit agreement terms including; (i) an increase of the maximum consolidated leverage ratio covenant from 5.50 to 1.00 to 5.75 to 1.00 for the fiscal quarters ending December 31, 2024 through September 30, 2025, returning to 5.50 to 1.00 thereafter; and (ii) changes to the minimum consolidated interest coverage ratio covenant from 2.40 to 1.00 to (A) 2.00 to 1.00 for the fiscal quarters ending December 31, 2024 through December 31, 2025, (B) 2.25 to 1.00 for the fiscal quarters ending March 31, 2026 through December 31, 2026, and (C) 2.50 to 1.00 at any time thereafter.
Current report
On February 28, 2025 we completed the sale of our Alkali Business to an indirect affiliate of WE Soda Ltd. for a gross purchase price of $1.425 billion. We received cash of approximately $1.039 billion, which reflects the net proceeds after the assumption of our outstanding Alkali senior secured notes by an indirect affiliate of WE Soda Ltd, amongst other purchase price adjustments. We used a portion of the cash proceeds to pay down the outstanding balance on our senior secured credit facility on February 28, 2025, and anticipate using the remaining cash proceeds to redeem a portion of our outstanding senior unsecured notes, repurchase certain of our outstanding Class A convertible preferred units, and for general partnership purposes.
Current report
In connection with the sale of our Alkali Business, we also entered into the Second Amendment to the Seventh Amended and Restated Credit Agreement. This amendment provides for: (i) a reduction from $900 million to $800 million of total borrowing capacity under our senior secured credit facility; (ii) unlimited cash netting against our outstanding debt for purposes of our Consolidated Leverage calculation if our credit facility is undrawn at the end of a reporting period, otherwise a maximum netting of $25 million is allowed; and (iii) an increased permitted investment basket under certain circumstances that will allow us to opportunistically purchase existing private or public securities across our capital structure.
Current report
(1)As of February 28, 2025, the Alkali senior secured notes, including the associated future interest and principal payments, were transferred as part of the sale of our Alkali Business.
Current report
The CHOPS expansion includes a complete overhaul of the GB-72 topside facilities, reconnection of the CHOPS Pipeline to the GB-72 platform, and the addition of pumps at both the HI-A5 and GB-72 platforms to upgrade processing capabilities and increase throughput. During the fourth quarter of 2024, we completed the overhaul of the GB-72 topside facilities and reconnected the CHOPS Pipeline to the GB-72 platform. We plan to complete the installation of the additional pumps in the first half of 2025.
Current report
We have successfully laid the 105 miles of SYNC Pipeline and plan to connect it to the Shenandoah FPS when it arrives to its final location in the Gulf of America in the first half of 2025.
Current report
During 2024, we terminated an on-going project related to the integration of certain of our corporate enterprise resource planning systems and we impaired the costs incurred to date. As a result, we recognized an impairment charge of $43.0 million associated with intangible construction in progress costs for the year ended December 31, 2024. For the years ended December 31, 2023 and 2022, we did not recognize an impairment expense associated with our long-lived assets.
Removed paragraphs (26)
Previous report
•Recent Accounting Pronouncements
Previous report
•Increased capacity for soda ash production from our original Granger facility and its approximately 500,000 tons of annual production, which came back online on January 1, 2023, and our GOP, which reached substantial completion and achieved first production in the fourth quarter of 2023 and is expected to ramp up to its 750,000 incremental tons of annual production in 2024, bringing total pro forma annual production capacity to approximately 4.8 million tons.
Previous report
•We continue to have a significant amount of available borrowing capacity under our senior secured credit facility, which will allow us, when combined with our increasing cash flow from operations as discussed above, to fund our high return capital projects, which will provide future cash flows to continue to further deleverage our balance sheet.
Previous report
(2)Offshore pipeline transportation Segment Margin in 2022 includes distributions received from one of our unrestricted subsidiaries, Independence Hub LLC, of $32.0 million associated with the sale of our 80% owned platform asset.
Previous report
Offshore Pipeline Transportation Segment Margin for 2023 increased $43.3 million, or 12%, from 2022, primarily due to increased crude oil and natural gas activity, primarily from volumes associated with the King’s Quay FPS, as first oil production was achieved during 2022, and the Argos FPS, which achieved first oil production in the second quarter of 2023. The 2023 period benefited from a full year of volumes from King’s Quay, including its ramp up in production to levels reaching approximately 130,000 barrels of oil equivalent per day during 2023. The King’s Quay FPS supports volumes from the Khaleesi, Mormont, and Samurai field developments and is life of lease dedicated to our 100% owned crude oil and natural gas lateral pipelines and further downstream to our 64% owned Poseidon pipeline and 64% owned CHOPS pipeline and our 25.67% owned Nautilus natural gas system for ultimate delivery to shore. The Argos FPS, which supports BP’s operated Mad Dog 2 field development, achieved production levels of approximately 90,000 barrels of oil per day in 2023, with 100% of the volumes flowing through our 64% owned and operated CHOPS pipeline for ultimate delivery to shore. We expect to continue to benefit from King’s Quay FPS and Argos FPS volumes during 2024 and over their anticipated production profiles. In addition to these developments, activity in and around our Gulf of Mexico asset base continues to be robust, including incremental in-field drilling at existing fields that tie into our infrastructure. Lastly, 2023 had less overall downtime as compared to 2022, which was primarily a result of no weather-related events during the year. These increases were offset by distributions received from one of our unrestricted subsidiaries, Independence Hub LLC, of $32.0 million from the sale of its platform asset in 2022.
Previous report
(3)Source: IHS Chemical.
Previous report
In our sulfur services business, we experienced lower than expected production during 2023 due to multiple factors, including a slower than expected ramp up in production from the completion of a major turnaround at one of our largest host refineries in the fourth quarter of 2022, unplanned operational and weather-related outages at several of our host refineries during the second quarter of 2023 (which returned to normal operations later in 2023), and lower production from a host refinery that partially converted its facility into a renewable diesel facility in the fourth quarter of 2022. In addition, we have experienced continued pressure on demand primarily in South America, which has negatively impacted sales volumes and pricing. In comparison, during 2022, we experienced robust NaHS sales volumes and prices due to an increase in demand from our mining customers, primarily in South America, and due to our ability to leverage our multi-faceted supply and terminal sites in our sulfur services business to capitalize on incremental spot volumes as certain of our competitors experienced one-off supply challenges.
Previous report
Total general and administrative expenses decreased $0.8 million between 2023 and 2022. The decrease is primarily due to lower costs associated with business development activities and growth projects as 2022 included costs associated with the issuance of our Alkali senior secured notes and related sale of the ORRI Interests, as well as costs associated with the divestiture of our previously owned Independence Hub platform. This decrease was partially offset by an increase in costs associated with our long-term incentive compensation plan as a result of the assumptions used to value our outstanding awards during 2023.
Previous report
Net income for the year ended December 31, 2022 included an unrealized loss of $18.6 million from the valuation of our previously recognized embedded derivative associated with our Class A Convertible Preferred Units, and also included cancellation of debt income of $8.6 million associated with the open market repurchase and extinguishment of certain of our senior unsecured notes. Both of these amounts are included within “Other expense, net” on the Consolidated Statement of Operations. In addition, Net income for the year ended December 31, 2022 included a gain of $40.0 million recorded in “Gain on sale of asset” on the Consolidated Statement of Operations, of which $8.0 million, or 20%, is attributable to our noncontrolling interest holder, related to the sale of our Independence Hub platform to a producer group in the Gulf of Mexico for gross proceeds of $40.0 million.
Previous report
(2)2022 includes $32.0 million in cash receipts associated with the sale of the Independence Hub platform by our 80% owned unrestricted subsidiary (as defined under our credit agreement), Independence Hub, LLC.
Previous report
(3)2023 includes an unrealized loss of $36.7 million from the valuation of our commodity derivatives transactions (excluding fair value hedges). 2022 includes an unrealized loss of $18.6 million from the valuation of our previously recorded embedded derivative associated with our Class A Convertible Preferred Units and an unrealized gain of $24.3 million from the valuation of our commodity derivatives transactions (excluding fair value hedges).
Previous report
(6)Represents transaction costs relating to certain merger, acquisition, divestiture, transition and financing transactions incurred in advance of the associated transaction.
Previous report
(2)The 2022 period includes PIK distributions, accretion and valuation adjustments on the redemption feature associated with our preferred units, which were redeemed during the year ended December 31, 2022.
Previous report
On April 8, 2021, we entered into our Fifth Amended and Restated Credit Agreement (the “old credit agreement”), which initially provided for a $950 million senior secured credit facility, which was comprised of a revolving senior secured credit facility (the “old revolving credit facility”) with a borrowing capacity of $650 million and a term loan with a borrowing capacity of $300 million, with the ability to increase the aggregate size of the old revolving credit facility by an additional $200 million subject to lender consent and certain other customary conditions. Our term loan was paid off in full on November 17, 2021 with a portion of the gross proceeds of $418 million received from the sale of a 36% minority interest in CHOPS. On February 17, 2023, we entered into the Sixth Amended and Restated Credit Agreement (our “credit agreement”) to replace our old credit agreement. Our credit agreement provides for a $850 million senior secured revolving credit facility that matures on February 13, 2026, subject to extension at our request for one additional year on up to two occasions and subject to certain conditions.
Previous report
On April 29, 2022, we received $40 million, or $32 million net to our ownership interests, for the sale of our 80% owned Independence Hub platform which allowed us to repay a portion of the borrowings outstanding under our old revolving credit facility and further increase our borrowing capacity.
Previous report
On May 17, 2022, Genesis Energy, L.P., through its newly created indirect unrestricted subsidiary, GA ORRI, issued $425 million principal amount of our 5.875% Alkali senior secured notes due 2042 to certain institutional investors, secured by GA ORRI’s fifty-year 10% limited term overriding royalty interest in substantially all of the Company’s Alkali Business trona mineral leases. The issuance generated net proceeds of $408 million, net of the issuance discount of $17 million. We make quarterly interest payments on our Alkali senior secured notes until March 2024, at which time we begin making quarterly principal and interest payments through the maturity date. We used a portion of net proceeds from the issuance to fully redeem the outstanding Alkali Holdings preferred units and utilized the remainder to repay a portion of the outstanding borrowings under our old revolving credit facility. The redemption of our Alkali Holdings preferred units, which carried an implied interest rate of 12-13%, and the issuance of our Alkali senior secured notes with a coupon rate of 5.875%, has allowed us to simplify our capital structure and lower our cost of capital, provide us additional flexibility under our senior secured credit facility, and remove any risk of refinancing our Alkali Holdings preferred units that were initially due in 2026.
Previous report
Our Class A Convertible Preferred Units contained a distribution Rate Reset Election (as defined in Note 11), which was elected by the holders of the Class A Convertible Preferred Units on September 29, 2022 (the “election date”). From the date of issuance through the election date, each of our Class A Convertible Preferred Units accumulated quarterly distribution amounts in arrears at an annual rate of 8.75% (or $2.9496), yielding a quarterly rate of 2.1875% (or $0.7374). On the election date, the holders of the Class A Convertible Preferred Units elected to reset the rate to 11.24%, yielding a quarterly distribution of $0.9473 per preferred unit beginning with the fourth quarter of 2022.
Previous report
Redeemable Noncontrolling interests
Previous report
On September 23, 2019, we, through a subsidiary, Alkali Holdings, entered into an amended and restated Limited Liability Company Agreement of Alkali Holdings (the “LLC Agreement”) and a Securities Purchase Agreement (the “Securities Purchase Agreement”) whereby BXC purchased $55.0 million of preferred units (or 55,000 preferred units) and committed to purchase, during a three-year commitment period, up to a total of $350.0 million of preferred units (or 350,000 preferred units) in Alkali Holdings. Alkali Holdings utilized the net proceeds from the preferred units to fund a portion of the anticipated cost of the GOP. On April 14, 2020, we entered into an amendment to our agreements with BXC to, among other things, extend the construction timeline of the GOP by one year, which we substantially completed in the fourth quarter of 2023. In consideration for the amendment, we issued 1,750 Alkali Holdings preferred units to BXC, which was accounted for as issuance costs. As part of the amendment, the commitment period was increased to four years, and the total commitment of BXC was increased to, subject to compliance with the covenants contained in our agreements with BXC, up to $351.8 million of preferred units (or 351,750 preferred units) in Alkali Holdings.
Previous report
From time to time after we had drawn at least $251.8 million, we had the option to redeem the outstanding preferred units in whole for cash at a price equal to the initial $1,000 per preferred unit purchase price, plus no less than the greater of a predetermined fixed internal rate of return amount or a multiple of invested capital metric, net of cash distributions paid to date (“Base Preferred Return”). Additionally, if all outstanding preferred units were redeemed, we had not drawn at least $251.8 million, and BXC was not a “defaulting member” under the LLC Agreement, BXC had the right to a make-whole amount on the number of undrawn preferred units.
Previous report
On May 17, 2022 (the “Redemption Date”), we fully redeemed the 251,750 outstanding Alkali Holdings preferred units a Base Preferred Return Amount of $288.6 million utilizing a portion of the proceeds we received from the issuance of our Alkali senior secured notes. As of December 31, 2022 and 2023, there were no Alkali Holdings preferred units outstanding.
Previous report
See Note 12 to our Consolidated Financial Statements in Item 8 for additional information regarding our mezzanine capital.
Previous report
In our petroleum products activities, we buy products and typically either move those products to one of our storage facilities for further blending or sell those products within days of our purchase. The cash requirements for these activities can result in short term increases and decreases in the borrowings under our senior secured credit facility.
Previous report
On September 23, 2019, we announced the GOP along with the issuance of the Alkali Holdings preferred units, which were anticipated to fund up to the total estimated cost of the GOP. During the fourth quarter of 2021, we made the decision to fund the remaining capital expenditures associated with the GOP internally in lieu of issuing additional Alkali Holdings preferred units. We reached substantial completion and achieved first production from the GOP during the fourth quarter of 2023 and expect production to ramp up to its incremental design capacity of 750,000 on an annual basis in 2024.
Previous report
During 2022, we entered into definitive agreements to provide transportation services for 100% of the crude oil production associated with two separate standalone deepwater developments that have a combined production capacity of approximately 160,000 barrels per day. In conjunction with these agreements, we are expanding the current capacity of our 64% owned CHOPS pipeline and constructing a new 100% owned, approximately 105 mile, 20” diameter crude oil pipeline, the SYNC pipeline, to connect one of the developments to our existing asset footprint in the Gulf of Mexico. We plan to complete the construction in line with the producers’ plan for first oil achievement, which is currently expected in late 2024 or 2025. Additionally, in 2023, we entered into several additional definitive agreements with existing producers to further commit additional volumes transported on our CHOPS pipeline. The producer agreements include long term take-or-pay arrangements and, accordingly, we are able to receive a project completion credit for purposes of calculating the leverage ratio under our credit agreement throughout the construction period.
Previous report
On May 17, 2022, we entered into an amendment to our old credit agreement, which designated GA ORRI and GA ORRI Holdings as unrestricted subsidiaries under our credit agreement. In addition, the amendment re-designated Genesis Alkali Holdings Company LLC, Genesis Alkali Holdings, LLC, Genesis Alkali, LLC and Genesis Alkali Wyoming, LP (the subsidiary entities that own our Alkali Business, other than the ORRI Interests) as restricted entities and guarantors of our old credit agreement. On May 17, 2022, we designated GA ORRI and GA ORRI Holdings as unrestricted subsidiaries and reclassified the entities that originally held our Alkali Business as restricted subsidiaries under the indentures governing our senior unsecured notes. The Alkali Business was historically presented as non-guarantor subsidiaries and because of such designation are now presented as guarantor subsidiaries. The changes made did not impact the Company’s previously reported consolidated net operating results, financial position, or cash flows.
Reworded paragraphs (67)
Previous wording
We are a growth-oriented MLP formed in Delaware in 1996. Our common units are traded on the New York Stock Exchange, or NYSE, under the ticker symbol “GEL.” We are (i) a provider of an integrated suite of midstream services (primarily transportation, storage, sulfur removal, blending, terminaling and processing) for a large area of the Gulf of Mexico and the Gulf Coast region of the crude oil and natural gas industry and (ii) one of the leading producers in the world of natural soda ash. We provide an integrated suite of services to refiners, crude oil and natural gas producers, and industrial and commercial enterprises and have a diverse portfolio of assets, including pipelines, offshore hub and junction platforms, refinery-related plants, storage tanks and terminals, railcars, rail unloading facilities, barges and other vessels, and trucks. The other core focus of our business is our trona and trona-based exploring, mining, processing, producing, marketing, logistics and selling business based in Wyoming (our “Alkali Business”). Our Alkali Business mines and processes trona from which it produces natural soda ash, also known as sodium carbonate (Na 2 CO 3), a basic building block for a number of ubiquitous products, including flat glass, container glass, dry detergent, lithium hydroxide and lithium carbonate (which are key inputs in the production of lithium batteries) and a variety of chemicals and other industrial products, and has been operating for approximately 75 years.
Current wording
We are a growth-oriented MLP formed in Delaware in 1996. Our common units are traded on the NYSE, under the ticker symbol “GEL.” We are a provider of an integrated suite of midstream services (primarily transportation, storage, sulfur removal, blending, terminaling and processing) for a large area of the Gulf of America and the Gulf Coast region of the crude oil and natural gas industry. We provide an integrated suite of services to crude oil and natural gas producers, refiners, and industrial and commercial enterprises and have a diverse portfolio of assets, including pipelines, offshore hub and junction platforms, refinery-related plants, storage tanks and terminals, railcars, rail unloading facilities, barges and other vessels, and trucks. Prior to February 28, 2025, our business also included our trona and trona-based exploring, mining, processing, producing, marketing, logistics and selling business based in Wyoming (our “Alkali Business”). Our Alkali Business mined and processed trona from which it produced natural soda ash, also known as sodium carbonate (Na 2 CO 3), a basic building block for a number of ubiquitous products, including flat glass, container glass, dry detergent, lithium hydroxide and lithium carbonate (which are key inputs in the production of lithium batteries) and a variety of chemicals and other industrial products.
Previous wording
We reported Net Income Attributable to Genesis Energy, L.P. of $117.7 million in 2023 compared to Net Income Attributable to Genesis Energy, L.P. of $75.5 million in 2022.
Current wording
We reported Net Loss Attributable to Genesis Energy, L.P. of $63.9 million in 2024 compared to Net Income Attributable to Genesis Energy, L.P. of $117.7 million in 2023.
Previous wording
Net Income Attributable to Genesis Energy, L.P. in 2023 was impacted by: (i) an increase in operating income associated with our reportable segments primarily due to increased volumes and activity in our offshore pipeline transportation segment and higher day rates in our marine transportation segment (see “Results of Operations” below for additional details on our individual segments); (ii) a decrease in depreciation, depletion and amortization expense of $16.0 million (see “Results of Operations” below for additional details); and (iii) an increase in our equity in earnings of equity investees of $12.0 million. Additionally, we had a decrease in income attributable to our redeemable noncontrolling interests of $30.4 million as the associated outstanding preferred units held at a subsidiary of our Alkali Business (our “Alkali Holdings preferred units,” which are further discussed in Note 12 to our Consolidated Financial Statements in Item 8) were redeemed during 2022.
Current wording
Net Loss Attributable to Genesis Energy, L.P. in 2024 was impacted by: (i) a decrease in operating income associated with our reportable segments primarily due to a decrease in export pricing in our Alkali Business (see “Results of Operations” below for additional details on our individual segments); (ii) an increase in depreciation, depletion and amortization expense of $33.0 million (see “Results of Operations” below for additional details); (iii) impairment expense of $43.0 million recorded during 2024 (see “Results of Operations” below for additional details); (iv) an increase in interest expense, net of $42.6 million (see “Results of Operations” below for additional details); and (v) an increase in other expense, net of $10.7 million as a result of the fees associated with the tender of $575.0 million of our 2027 Notes during 2024.
Previous wording
These increases were partially offset by a gain on sale of assets of $40.0 million (of which $8.0 million was attributable to our noncontrolling interests) in 2022 associated with the sale of our 80% owned Independence Hub platform and an increase to interest expense of $18.5 million during 2023 (see “Results of Operations” below for additional details). Additionally, 2023 included a net unrealized loss of $36.7 million from the valuation of our commodity derivative transactions (excluding fair value hedges) compared to a net unrealized gain of $5.7 million during 2022.
Current wording
These decreases were partially offset by net unrealized gains of $7.8 million in 2024 from the valuation of our commodity derivative transactions (excluding fair value hedges) compared to a net unrealized loss of $36.7 million during 2023.
Previous wording
Cash flows from operating activities were $521.1 million for the 2023 period compared to $334.4 million for 2022. This increase was primarily attributable to higher Segment Margin reported during 2023 (inclusive of $32.0 million of distributions received net to us from the sale of the Independence Hub platform asset, which is included in Segment Margin and a cash flow from investing activities in 2022 on the Condensed Consolidated Statement of Cash Flows) and positive changes in our working capital requirements during 2023.
Current wording
Cash flows from operating activities were $391.9 million for 2024 compared to $521.1 million for 2023. This decrease was primarily attributable to lower Segment Margin reported during 2024 compared to 2023. This decrease was partially offset by positive changes in our working capital requirements during 2024. A more detailed discussion of our segment results and other costs is included below in “Results of Operations.”
Previous wording
Available Cash before Reserves (as defined below in “Financial Measures”) decreased $1.4 million in 2023 to $351.2 million as compared to 2022 Available Cash before Reserves of $352.6 million, primarily due to the following items: i) an increase in distributions to preferred unitholders of $11.8 million; ii) an increase in interest expense of $18.5 million; iii) an increase in maintenance capital utilized of $10.3 million; iv) an increase in corporate general and administrative expenses of $8.0 million; and v) a decrease in income related to cancellation of debt of $8.6 million., as we repurchased and extinguished certain of our senior unsecured notes during 2022 This was almost fully offset by our increase in Segment Margin, which is further discussed below in “Results from Operations.” See “Financial Measures” below for additional information on Available Cash before Reserves.
Current wording
Available Cash before Reserves (as defined below in “Financial Measures”) decreased $191.8 million in 2024 to $159.4 million as compared to 2023 Available Cash before Reserves of $351.2 million, primarily due to a decrease in Segment Margin of $154.0 million (which is further discussed below in “Results from Operations”) and an increase in interest expense, net of $42.6 million. See “Financial Measures” below for additional information on Available Cash before Reserves.
Previous wording
Segment Margin was $827.1 million in 2023, an increase of $57.0 million as compared to 2022. We currently manage our businesses through four divisions that constitute our reportable segments - offshore pipeline transportation, soda and sulfur services, marine transportation and onshore facilities and transportation. A more detailed discussion of our segment results and other costs is included below in “Results of Operations”.
Current wording
Segment Margin was $673.0 million in 2024, a decrease of $154.0 million as compared to 2023. We currently manage our businesses through four divisions that constitute our reportable segments - offshore pipeline transportation, soda and sulfur services, marine transportation and onshore facilities and transportation. A more detailed discussion of our segment results and other costs is included below in “Results of Operations.”
Previous wording
On February 14, 2024, we paid a distribution of $0.15 per common unit related to the fourth quarter of 2023.
Current wording
On February 14, 2025, we paid a distribution of $0.165 per common unit related to the fourth quarter of 2024.
Previous wording
With respect to our Class A Convertible Preferred Units, we declared a quarterly cash distribution of $0.9473 per unit (or $3.789 on an annualized basis). These distributions were paid on February 14, 2024 to unitholders holders of record at the close of business January 31, 2024.
Current wording
With respect to our Class A Convertible Preferred Units, we declared a quarterly cash distribution of $0.9473 per unit (or $3.7892 on an annualized basis). These distributions were paid on February 14, 2025 to unitholders holders of record at the close of business January 31, 2024.
Previous wording
Our primary objectives are to generate and grow stable free cash flows and continue to deleverage our balance sheet, while never wavering from our commitment to safe and responsible operations, as well as continue to advance and integrate our sustainability program. We believe the following are important to meet our objectives:
Current wording
Our primary objectives are to generate and grow stable free cash flows and continue to deleverage our balance sheet, while never wavering from our commitment to safe and responsible operations. We believe the following are important to meet our objectives:
Previous wording
•New and increased volumes on our existing offshore assets in the Gulf of Mexico through long-term contracted commercial opportunities that require minimal to no additional investment from us. This includes a full ramp up in volumes from the Argos FPS, which achieved first production in April 2023, and from the King’s Quay FPS and the Spruance development, both of which achieved first production in 2022.
Current wording
•New and increased volumes on our existing offshore assets in the Gulf of America through long-term contracted commercial opportunities that require minimal to no additional investment from us, including continued in-field and sub-sea tieback opportunities as a result of the continued investment by the offshore producing community.
Previous wording
•New incremental volumes from long-term contracted offshore commercial opportunities in the Gulf of Mexico, including the Shenandoah development, which will tie into our SYNC pipeline and further downstream to our CHOPS pipeline, and the Salamanca FPS, which will tie into our existing SEKCO pipeline for further transportation downstream to our existing pipeline network. These developments and their associated volumes are currently expected to come online in late 2024 and 2025.
Current wording
•New incremental volumes from long-term contracted offshore commercial opportunities in the Gulf of America, including the Shenandoah development, which will tie into our SYNC Pipeline and further downstream to our CHOPS Pipeline, and the Salamanca FPS, which will tie into our existing SEKCO Pipeline for further transportation downstream to our Poseidon Pipeline. These developments and their associated volumes are expected to come online in the first half of 2025.
Previous wording
During 2022, we entered into definitive agreements to provide transportation services for 100% of the crude oil production associated with two separate standalone deepwater developments that have a combined production capacity of approximately 160,000 barrels per day. In conjunction with these agreements, we are expanding the current capacity of the CHOPS pipeline and constructing a new 100% owned, approximately 105-mile, 20” diameter crude oil pipeline, the SYNC pipeline, to connect one of the developments to our existing asset footprint in the Gulf of Mexico. We plan to complete the construction in line with the producers’ plan for first oil achievement, which is currently expected in late 2024 or 2025. Additionally, in 2023, we entered into several additional definitive agreements with existing producers to further commit additional volumes transported on our CHOPS pipeline. The producer agreements include long term take-or-pay arrangements and, accordingly, we are able to receive a project completion credit for purposes of calculating the leverage ratio under our senior secured credit agreement throughout the construction period.
Current wording
During 2022, we entered into definitive agreements to provide transportation services for 100% of the crude oil production associated with two separate standalone deepwater developments that have a combined production capacity of approximately 160,000 barrels per day. In conjunction with these agreements, we are expanding the current capacity of the CHOPS Pipeline and constructing the SYNC Pipeline to connect one of the developments to our existing asset footprint in the Gulf of America.
Previous wording
Our revenues for the year ended December 31, 2023 increased $388.0 million, or 14%, from the year ended December 31, 2022, and our costs and expenses (excluding the gain on sale of assets in 2022) increased $333.6 million, or 13%, between the two periods, with a net increase to operating income (excluding the gain on sale of assets in 2022) of $54.4 million. The increase in our operating income during 2023 is primarily attributable to the increase in our reported Segment Margin primarily as a result of increased volumes and activity in our offshore pipeline transportation segment and increased utilization and day rates in our marine transportation segment, as well as lower depreciation, depletion and amortization during 2023. These increases were offset by a net unrealized loss of $36.7 million in 2023 as compared to a net unrealized gain of $5.7 million during 2022 from the valuation of our commodity derivative transactions (excluding fair value hedges).
Current wording
Our revenues for the year ended December 31, 2024 decreased $210.8 million, or 7%, from the year ended December 31, 2023, and our costs and expenses (excluding the impairment expense in 2024) decreased $137.5 million, or 5%, between the two periods, with a net decrease to operating income (excluding the impairment expense in 2024) of $73.3 million. The decrease in our operating income during 2024 is primarily attributable to lower export pricing in our Alkali Business and higher depreciation, depletion and amortization during 2024. These decreases were partially offset by higher day rates in our marine transportation segment. See further discussion below under “Segment Margin” regarding the activity in our individual operating segments.
Previous wording
A substantial portion of our revenues and costs are derived from the purchase and sale of crude oil in our crude oil marketing business, which is included in our onshore facilities and transportation segment, revenues and costs associated with our Alkali Business, which is included in our soda and sulfur services segment, and revenues and costs associated with our offshore pipeline transportation segment. We describe, in more detail, the impact on revenues and costs for each of our businesses below.
Current wording
A substantial portion of our revenues and costs during the periods presented were derived from our Alkali Business, which is included in our soda and sulfur services segment, and the purchase and sale of crude oil in our crude oil marketing business, which is included in our onshore facilities and transportation segment. We describe, in more detail, the impact on revenues and costs for each of our businesses below.
Previous wording
As it relates to our Alkali Business, our revenues are derived from the extraction of trona, as well as the activities surrounding the processing and sale of natural soda ash and other alkali specialty products, including sodium sesquicarbonate (S-Carb) and sodium bicarbonate (Bicarb), and are a function of our selling prices and volume sold. We sell our products to an industry-diverse and worldwide customer base. Our sales prices are contracted at various times throughout the year and for different durations. Our sales prices for volumes sold internationally are contracted for the current year either annually in the prior year or periodically throughout the current year (often quarterly), and our volumes priced and sold domestically are contracted at various times and can be of varying durations, often multi-year terms. The majority of our volumes sold internationally are sold through ANSAC, which became a wholly owned subsidiary of our Alkali Business on January 1, 2023 as we became the sole member of it at that time. ANSAC promotes export sales of U.S. produced soda ash utilizing its logistical asset and marketing capabilities. During the year ended December 31, 2023, in addition to the volumes supplied by our operations and sold by ANSAC, ANSAC continued to receive a level of soda ash supply from certain former members to sell internationally, which is expected to continue in some capacity for at least the next several years. As a result of consolidating the results of ANSAC beginning on January 1, 2023, the sale of the soda ash volumes by ANSAC that were supplied by non-members are included in our consolidated results and have a proportionate effect to our revenues and costs, with little to no direct impact to our reported Segment Margin, Net income (loss) and Available Cash before Reserves. We will continue to report the sales volumes of soda ash included in the operating results table for our soda and sulfur services segment shown below as we have historically reported them for comparability purposes and due to the minimal impact these incremental sales volumes from ANSAC have on our reported Segment Margin, Net income (loss) and Available Cash before Reserves. Our sales volumes can fluctuate from period to period and are dependent upon many factors, of which the main drivers are the global market, customer demand, economic growth, and our ability to produce soda ash. Positive or negative changes to our revenue, through fluctuations in sales volumes or sales prices, can have a direct impact to Segment Margin, Net income (loss) and Available Cash before Reserves as these fluctuations have a lesser impact to operating costs due to the fact that a portion of our costs are fixed in nature. Our costs, some of which are variable in nature and others are fixed in nature, relate primarily to the processing and producing of soda ash (and other alkali specialty products) and marketing and selling activities. In addition, costs include activities ass…
Excerpt shortened here; the source contains the full paragraph.
Current wording
As it relates to our Alkali Business for the periods presented, our revenues are derived from the extraction of trona, as well as the activities surrounding the processing and sale of natural soda ash and other alkali specialty products, including sodium sesquicarbonate (S-Carb) and sodium bicarbonate (Bicarb), and are a function of our selling prices and volumes sold. We sell our products to an industry-diverse and worldwide customer base. The majority of our volumes sold internationally are sold through ANSAC, which became a wholly owned subsidiary of our Alkali Business on January 1, 2023 as we became the sole member of it at that time. ANSAC promotes export sales of U.S. produced soda ash utilizing its logistical asset and marketing capabilities. During 2024, in addition to the volumes supplied by our operations and sold by ANSAC, ANSAC continued to receive a level of soda ash supply from certain former members to sell internationally, which is expected to continue in some capacity for at least the next several years. As a result of consolidating the results of ANSAC beginning on January 1, 2023, the sale of the soda ash volumes by ANSAC that were supplied by non-members are included in our consolidated results and have a proportionate effect to our revenues and costs, with little to no direct impact to our reported Net income (loss), Segment Margin and Available Cash before Reserves. We report the sales volumes of soda ash, which are included in the operating results table for our soda and sulfur services segment shown below as we have historically reported them for comparability purposes and due to the minimal impact these incremental sales volumes from ANSAC have on our reported Net income (loss), Segment Margin and Available Cash before Reserves.
Previous wording
As it relates to our crude oil marketing business, the average closing prices for West Texas Intermediate crude oil on the New York Mercantile Exchange (“NYMEX”) decreased approximately 18% to $77.58 per barrelin 2023 as compared to $94.90 per barrel in 2022. We would expect changes in crude oil prices to continue to proportionately affect our revenues and costs attributable to our purchase and sale of crude oil and petroleum products, producing minimal direct impact on Segment Margin, Net income (loss) and Available Cash before Reserves. We have limited our direct commodity price exposure in our crude oil and petroleum products operations through the broad use of fee-based service contracts, back-to-back purchase and sale arrangements, and hedges. As a result, changes in the price of crude oil would proportionately impact both our revenues and our costs, with a disproportionately smaller net impact on our Segment Margin. However, we do have some indirect exposure to certain changes in prices for oil and petroleum products, particularly if they are significant and extended. We tend to experience more demand for certain of our services when prices increase significantly over extended periods of time, and we tend to experience less demand for certain of our services when prices decrease significantly over extended periods of time. For additional information regarding certain of our indirect exposure to commodity prices, see our segment-by-segment analysis below and the previous section above entitled “Risks Related to Our Business”.
Current wording
As it relates to our crude oil marketing business, the average closing prices for West Texas Intermediate crude oil on the New York Mercantile Exchange (“NYMEX”) decreased approximately 1% to $76.63 per barrel in 2024 as compared to $77.58 per barrel in 2023. We would expect changes in crude oil prices to continue to proportionately affect our revenues and costs attributable to our purchase and sale of crude oil, producing minimal direct impact on Net income (loss), Segment Margin and Available Cash before Reserves. We have limited our direct commodity price exposure in our crude oil operations through the broad use of fee-based service contracts, back-to-back purchase and sale arrangements, and hedges. As a result, changes in the price of crude oil would proportionately impact both our revenues and our costs, with a disproportionately smaller impact on Net income (loss), Segment Margin and Available Cash before Reserves. However, we do have some indirect exposure to certain changes in prices for oil, particularly if they are significant and extended. We tend to experience more demand for certain of our services when prices increase significantly over extended periods of time, and we tend to experience less demand for certain of our services when prices decrease significantly over extended periods of time. For additional information regarding certain of our indirect exposure to commodity prices, see our segment-by-segment analysis below and the section of our Annual Report entitled “ Risks Related to Our Business.”
Previous wording
Our offshore Gulf of Mexico crude oil and natural gas pipeline transportation and handling operations focus on integrated and large independent energy companies who make intensive capital investments (often in excess of a billion dollars) to develop large reservoir, long-lived crude oil and natural gas properties. Our revenues are primarily derived from the fees, typically on a per barrel basis, we charge to transport and deliver commodities (or reserve capacity on our infrastructure in some cases) downstream to other pipelines or refineries along the Gulf Coast. The shippers on our offshore pipelines are mostly integrated and large independent energy companies whose production is ideally suited for the vast majority of refineries along the Gulf Coast. Their large-reservoir properties and the related pipelines and other infrastructure needed to develop them are capital intensive and yet, we believe, economically viable, in most cases, even in volatile commodity price environments. Costs include activities associated with employee compensation and benefits, the maintenance of our pipelines and pipeline related infrastructure, marketing, and other variable type expenses associated with operating the business. We do not expect changes in commodity prices to impact our Net income (loss), Available Cash before Reserves or Segment Margin derived from our offshore Gulf of Mexico crude oil and natural gas pipeline transportation and handling operations in the same manner in which they impact our revenues and costs derived from the purchase and sale of crude oil and petroleum products.
Current wording
Our offshore Gulf of America crude oil and natural gas pipeline transportation and handling operations focus on integrated and large independent energy companies who make intensive capital investments (often in excess of a billion dollars) to develop large reservoir, long-lived crude oil and natural gas properties. Our revenues are primarily derived from the fees, typically on a per barrel basis, we charge to transport and deliver commodities (or reserve capacity on our infrastructure in some cases) downstream to other pipelines or refineries along the Gulf Coast. The shippers on our offshore pipelines are mostly integrated and large independent energy companies whose production is ideally suited for the vast majority of refineries along the Gulf Coast. Their large-reservoir properties and the related pipelines and other infrastructure needed to develop them are capital intensive and yet, we believe, economically viable, in most cases, even in volatile commodity price environments. Costs include activities associated with employee compensation and benefits, the maintenance of our pipelines and pipeline related infrastructure, marketing, and other variable type expenses associated with operating the business. We do not expect changes in commodity prices to impact our Net income (loss), Available Cash before Reserves or Segment Margin derived from our offshore Gulf of America crude oil and natural gas pipeline transportation and handling operations in the same manner in which they impact our revenues and costs derived from the purchase and sale of crude oil and petroleum products.
Previous wording
In addition to our crude oil marketing business, Alkali Business and offshore pipeline transportation and handling operations discussed above, we continue to operate in our other core businesses, including our sulfur services business and our onshore-based refinery-centric operations located primarily in the Gulf Coast region of the U.S., which focus on providing a suite of services primarily to refiners. Refiners are the shippers of approximately 98% of the volumes transported on our onshore crude pipelines, and refiners account for approximately 90% of the revenues from our marine transportation segment during 2023, where we primarily transport intermediate refined products (not crude oil) between refining complexes.
Current wording
Our sulfur services business and our onshore-based refinery-centric operations (including the operations in both our onshore facilities and transportation and marine transportation segments) are located primarily in the Gulf Coast region of the U.S., and focus on providing a suite of services primarily to refiners. Refiners are the shippers of a majority of the volumes transported on our onshore crude pipelines, and refiners accounted for approximately 95% of the revenues from our marine transportation segment during 2024, where we primarily transport intermediate refined products (not crude oil) between refining complexes.
Previous wording
Included below is additional detailed discussion of the results of our operations focusing on Segment Margin and other costs including general and administrative expenses, depreciation, depletion and amortization, gain on sale of assets, interest expense and income taxes.
Current wording
Included below is additional detailed discussion of the results of our operations focusing on Segment Margin and other costs including general and administrative expenses, depreciation, depletion and amortization, impairment expense, interest expense, net, and income taxes.
Previous wording
(3)One of our wholly-owned subsidiaries (GEL Offshore Pipeline, LLC, or “GOPL”) owns our undivided interest in the Eugene Island pipeline system.
Current wording
(2)One of our wholly-owned subsidiaries (GEL Offshore Pipeline, LLC, or “GOPL”) owns our undivided interest in the Eugene Island pipeline system.
Previous wording
(4)Volumes are the product of our effective ownership interest throughout the year multiplied by the relevant throughput over the given year.
Current wording
(3)Volumes are the product of our effective ownership interest throughout the year multiplied by the relevant throughput over the given year.
Previous wording
(2)Revenues in 2023 include sales by ANSAC that were not produced and supplied by our Alkali Business that are included in our consolidated revenues. See discussion above in “Results of Operations — Revenues and Costs and Expenses” regarding revenues associated with our Alkali Business.
Current wording
(2)Revenues include sales by ANSAC that were not produced and supplied by our Alkali Business that are included in our consolidated revenues. See discussion above in “Results of Operations — Revenues and Costs and Expenses” regarding revenues associated with our Alkali Business.
Previous wording
Soda and sulfur services Segment Margin for 2023 decreased $24.7 million, or 8%, from 2022. This decrease is primarily attributable to lower NaHS and caustic soda sales volumes and pricing in our sulfur services business which was partially offset by higher soda ash sales volumes and slightly higher domestic and export pricing in our Alkali Business during 2023. We successfully restarted our original Granger production facility on January 1, 2023 and ramped up the production to its original nameplate capacity of approximately 500,000 tons on an annual basis during 2023. We also reached substantial completion and achieved first production from the GOP in the fourth quarter of 2023 and anticipate ramping up to the expected 750,000 incremental tons of annual production in 2024. Additionally, we had higher pricing on our domestic and export sales in 2023 due to a strong supply and demand balance in the first half of the year, which weakened in the second half of the year as a result of new global supply entering the market and a slower than anticipated re-opening of China’s economy. We expect this volatility to continue into 2024.
Current wording
Soda and sulfur services Segment Margin for 2024 decreased $98.5 million, or 35%, from 2023. This decrease is primarily attributable to lower export pricing in our Alkali Business during 2024 and lower NaHS and caustic soda sales volumes and pricing, which was partially offset by higher soda ash sales volumes and higher domestic pricing in our Alkali Business.
Previous wording
Within our marine transportation segment, we own a fleet of 91 barges (82 inland and 9 offshore) with a combined transportation capacity of 3.2 million barrels, 42 push/tow boats (33 inland and 9 offshore), and a 330,000 barrel capacity ocean going tanker, the M/T American Phoenix. Operating results for our marine transportation segment were as follows:
Current wording
Within our marine transportation segment, we own a fleet of 87 barges (78 inland and 9 offshore) with a combined transportation capacity of 3.0 million barrels, 43 push/tow boats (33 inland and 10 offshore), and a 330,000 barrel capacity ocean going tanker, the M/T American Phoenix. Operating results for our marine transportation segment were as follows:
Previous wording
Marine Transportation Segment Margin for 2023 increased $44.2 million, or 67%, from 2022. This increase is primarily attributable to an increase in our overall day rates (including both spot and term) in our inland and offshore business, including the M/T American Phoenix, during 2023. The increase in our day rates is due to the continued high demand for our barge services to move intermediate and refined products as a result of strong refinery utilization rates and a lack of new supply of similar type vessels (primarily due to higher construction costs and long lead times for construction) combined with the retirement of older vessels in the market. Additionally, we entered into a new three-and-a-half-year contract on the M/T American Phoenix, which started in January 2024 with a credit-worthy counterparty at the highest day rate we have received since we first purchased the vessel in 2014.
Current wording
Marine Transportation Segment Margin for 2024 increased $14.6 million, or 13%, from 2023. This increase is primarily attributable to an increase in our overall day rates in our inland and offshore business, including the M/T American Phoenix, during 2024. The increase in day rates more than offset the impact to Segment Margin from the increased number of planned regulatory dry-docking days in our offshore fleet during 2024 as compared to 2023. In addition, we have continued to see strong demand from our barge services to move intermediate and refined products keeping utilization rates high across both periods. This strong demand from our customers as well as the lack of new supply of similar type vessels and the continued retirement of older vessels in the market have contributed to the increase in day rates discussed above, which we expect to continue into 2025. The M/T American Phoenix started a new three-and-a-half year contract at the beginning of 2024 with a credit-worthy counterparty at the highest day rate we have received since we first purchased the vessel in 2014.
Previous wording
(1)Total daily volumes for the years ended December 31, 2023 and 2022 include 32,458 and 28,850 Bbls/day, respectively, of intermediate refined products and 33,019 and 53,459 Bbls/day, respectively, of crude oil associated with our Port of Baton Rouge Terminal pipelines.
Current wording
(1)Total daily volumes for the years ended December 31, 2024 and 2023 include 19,298 and 32,458 Bbls/day, respectively, of intermediate refined products and 36,046 and 33,019 Bbls/day, respectively, of crude oil associated with our Port of Baton Rouge Terminal pipelines.
Previous wording
Segment Margin for our onshore facilities and transportation segment decreased $5.8 million, or 17% , in 2023 as compared to 2022. The decrease is primarily due to an overall decrease in activity associated with our Baton Rouge corridor assets, specifically our rail unload and pipeline volumes, and a decrease in volumes on our Texas pipeline system during 2023.
Current wording
Segment Margin for our onshore facilities and transportation segment increased $3.8 million, or 14%, in 2024 as compared to 2023. The increase is primarily due to an increase in the rail unload volumes at our Scenic Station facility. This increase was partially offset by an overall decrease in volumes on our onshore crude oil pipeline systems.
Previous wording
Total depreciation, depletion and amortization expense decreased $16.0 million between 2023 and 2022. This decrease is primarily attributable to an acceleration of depreciation on our asset retirement obligation assets as a result of updates to the estimated timing and costs associated with certain of our non-core offshore gas assets in 2022. This decrease was partially offset by an overall increase in our depreciable asset base due to our continued growth and maintenance capital expenditures and placing new assets into service subsequent to the period ended December 31, 2022.
Current wording
Total depreciation, depletion and amortization expense increased $33.0 million between 2024 and 2023. This increase is primarily attributable to our continued growth and maintenance capital expenditures and placing new assets into service, including the GOP. This increase was partially offset by an acceleration of depreciation on our asset retirement obligation assets as a result of updates to the estimated timing and costs associated with certain of our non-core offshore gas assets in 2023.
Previous wording
Net interest expense increased $18.5 million between 2023 and 2022 primarily due to an increase in interest expense associated with our senior secured credit facility, our Alkali senior secured notes (which we issued in May 2022 and incurred a full year of interest expense during 2023), and our senior unsecured notes. The increase in interest expense associated with our senior secured credit facility is primarily due to an increase in the SOFR rate, which is one of the main components of our interest rate, compared to 2022, and higher outstanding indebtedness during 2023. The increase in interest expense associated with our senior unsecured notes was primarily related to the issuance of our 2030 Notes in January 2023, which have a higher principal and interest rate than the 2024 Notes that were redeemed in January 2023.
Current wording
Interest expense, net increased $42.6 million between 2024 and 2023 primarily due to an increase in interest associated with our senior unsecured notes and senior secured credit facility. The increase in interest expense associated with our senior unsecured notes was primarily related to: (i) the issuance of our 8.25% senior unsecured notes due January 15, 2029 (the “2029 Notes”) in December 2023, which have a higher principal and interest rate as compared to our 6.50% senior unsecured notes due October 1, 2025 (the “2025 Notes”) that were partially tendered in December 2023 and ultimately redeemed in January 2024; and (ii) the issuance of our 2032 Notes in May 2024, which have a higher principal and interest rate as compared to our 2026 Notes that were redeemed in June 2024. The increase in interest expense associated with our senior secured credit facility is primarily due to higher average outstanding indebtedness during 2024 and an increase in the SOFR rate, which is one of the main components of our interest rate, compared to 2023.
Previous wording
This increase was partially offset by higher capitalized interest during 2023 as a result of our increased capital expenditures associated with the GOP and our offshore growth capital construction projects during the year.
Current wording
This increase was partially offset by higher capitalized interest during 2024 as a result of our increased capital expenditures associated with our offshore growth capital construction projects during the year.
Previous wording
To help evaluate our business, this Annual Report on Form 10-K includes the non-generally accepted accounting principles (“non-GAAP”) financial measure of Available Cash before Reserves. We also present total Segment Margin as if it were a non-GAAP measure. Our non-GAAP measures may not be comparable to similarly titled measures of other companies because such measures may include or exclude other specified items. The accompanying schedules provide reconciliations of these non-GAAP financial measures to their most directly comparable financial measures calculated in accordance with generally accepted accounting principles in the United States of America (GAAP). A reconciliation of Net income (loss) attributable to Genesis Energy, L.P. to total Segment Margin is included in our segment disclosure in Note 14 to our Consolidated Financial Statements in Item 8. Our non-GAAP financial measures should not be considered (i) as alternatives to GAAP measures of liquidity or financial performance or (ii) as being singularly important in any particular context; they should be considered in a broad context with other quantitative and qualitative information. Our Available Cash before Reserves and total Segment Margin measures are just two of the relevant data points considered from time to time.
Current wording
To help evaluate our business, this Annual Report on Form 10-K includes the non-generally accepted accounting principles (“non-GAAP”) financial measure of Available Cash before Reserves. We also present total Segment Margin as if it were a non-GAAP measure. Our non-GAAP measures may not be comparable to similarly titled measures of other companies because such measures may include or exclude other specified items. The accompanying schedules provide reconciliations of these non-GAAP financial measures to their most directly comparable financial measures calculated in accordance with generally accepted accounting principles in the United States of America (GAAP). A reconciliation of Net income (loss) from operations before income taxes to total Segment Margin is included in our segment disclosure in Note 14 to our Consolidated Financial Statements in Item 8. Our non-GAAP financial measures should not be considered (i) as alternatives to GAAP measures of liquidity or financial performance or (ii) as being singularly important in any particular context; they should be considered in a broad context with other quantitative and qualitative information. Our Available Cash before Reserves and total Segment Margin measures are just two of the relevant data points considered from time to time.
Previous wording
We define Segment Margin as revenues less product costs, operating expenses, and segment general and administrative expenses (all of which are net of the effects of our noncontrolling interest holders), plus or minus applicable Select Items (defined below). Although, we do not necessarily consider all of our Select Items to be non-recurring, infrequent or unusual, we believe that an understanding of these Select Items is important to the evaluation of our core operating results. Our chief operating decision maker (our Chief Executive Officer) evaluates segment performance based on a variety of measures including Segment Margin, segment volumes where relevant and capital investment.
Current wording
We define Segment Margin as revenues less product costs, operating expenses, and segment general and administrative expenses (all of which are net of the effects of our noncontrolling interest holders), plus or minus applicable Select Items (defined below). Although we do not necessarily consider all of our Select Items to be non-recurring, infrequent or unusual, we believe that an understanding of these Select Items is important to the evaluation of our core operating results. Our chief operating decision maker (our Chief Executive Officer) evaluates segment performance based on a variety of measures including Segment Margin, segment volumes, and where relevant, capital investment.
Previous wording
A reconciliation of Net income (loss) attributable to Genesis Energy, L.P. to total Segment Margin is included in our segment disclosure in Note 14 to our Consolidated Financial Statements in Item 8.
Current wording
A reconciliation of Net income (loss) from operations before income taxes to total Segment Margin is included in our segment disclosure in Note 14 to our Consolidated Financial Statements in Item 8.
Previous wording
We define Available Cash before Reserves (“Available Cash before Reserves”) as Net income (loss) attributable to Genesis Energy, L.P. before interest, taxes, depreciation, depletion and amortization (including impairment, write-offs, accretion and similar items) after eliminating other non-cash revenues, expenses, gains, losses and charges (including any loss on asset dispositions), plus or minus certain other select items that we view as not indicative of our core operating results (collectively, “Select Items”), as adjusted for certain items, the most significant of which in the relevant reporting periods have been the sum of maintenance capital utilized, net interest expense, cash tax expense and cash distributions paid to our Class A convertible preferred unitholders. Although we do not necessarily consider all of our Select Items to be non-recurring, infrequent or unusual, we believe that an understanding of these Select Items is important to the evaluation of our core operating results. The most significant Select Items in the relevant reporting periods are set forth below.
Current wording
We define Available Cash before Reserves (“Available Cash before Reserves”) as Net income (loss) attributable to Genesis Energy, L.P. before interest, taxes, depreciation, depletion and amortization (including impairment, write-offs, accretion and similar items) after eliminating other non-cash revenues, expenses, gains, losses and charges (including any loss on asset dispositions), plus or minus certain other select items that we view as not indicative of our core operating results (collectively, “Select Items”), as adjusted for certain items, the most significant of which in the relevant reporting periods have been the sum of maintenance capital utilized, interest expense, net, cash tax expense and cash distributions paid to our Class A convertible preferred unitholders. Although we do not necessarily consider all of our Select Items to be non-recurring, infrequent or unusual, we believe that an understanding of these Select Items is important to the evaluation of our core operating results. The most significant Select Items in the relevant reporting periods are set forth below.
Previous wording
(4)2023 includes the write-off of the unamortized issuance costs and tender premium fees associated with the repurchase and extinguishment of our 2024 Notes and 2025 Notes. 2022 includes the write-off of the unamortized issuance costs associated with the repurchase and extinguishment of certain of our senior unsecured notes during the year.
Current wording
(2)2024 includes a net loss of $14.0 million associated with the tender fee and write-off of the related unamortized debt issuance costs and premium on our 2027 Notes that were tendered and redeemed and a loss of $1.4 million from the write-off of the unamortized issuance costs associated with our 2026 Notes that were redeemed during the year. 2023 includes the write-off of the unamortized issuance costs and tender premium fees associated with the repurchase and extinguishment of our 2024 Notes and 2025 Notes.
Previous wording
(5)Represents the net effect of adding distributions from equity investees and deducting earnings of equity investees net to us.
Current wording
(3)Represents the net effect of adding distributions from equity investees and deducting earnings of equity investees net to us.
Previous wording
(1)Maintenance capital expenditures in 2023 and 2022 were $125.0 million and $132.5 million, respectively. Our maintenance capital expenditures are principally associated with our alkali and marine transportation businesses.
Current wording
(1)Maintenance capital expenditures in 2024 and 2023 were $172.8 million and $125.0 million, respectively. Our maintenance capital expenditures are principally associated with our alkali and marine transportation businesses.
Previous wording
In an effort to return capital to our investors, we announced the Repurchase Program on August 8, 2023. The Repurchase Program authorizes the repurchase from time to time of up to 10% of our then outstanding Class A Common Units, or 12,253,922 units, via open market purchases or negotiated transactions conducted in accordance with applicable regulatory requirements. These repurchases may be made pursuant to a repurchase plan or plans that comply with Rule 10b5-1 under the Securities Exchange Act of 1934. The Repurchase Program will be reviewed no later than December 31, 2024 and may be suspended or discontinued at any time prior thereto. The Repurchase Program does not create an obligation for us to acquire a particular number of Class A Common Units and any Class A Common Units repurchased will be canceled. During 2023, we repurchased and canceled a total of 114,900 Class A Common Units at an average price of approximately $9.09 per unit for a total purchase price of $1.0 million, including commissions, which is reflected as a reduction to the carrying value of our “Partners’ Capital - Common unitholders” on our Condensed Consolidated Balance Sheet as of December 31, 2023. We anticipate funding any future repurchase activity with a portion of our cash flows from operations and liquidity available under our senior secured credit facility.
Current wording
On August 8, 2023, we announced the “Repurchase Program.” In an effort to return capital to our investors, the Repurchase Program authorizes the repurchase from time to time of up to 10% of our then outstanding Class A Common Units, or 12,253,922 units, via open market purchases or negotiated transactions conducted in accordance with applicable regulatory requirements. These repurchases may be made pursuant to a repurchase plan or plans that comply with Rule 10b5-1 under the Securities Exchange Act of 1934. The Repurchase Program will be reviewed no later than December 31, 2026 and may be suspended or discontinued at any time prior thereto. The Repurchase Program does not create an obligation for us to acquire a particular number of Class A Common Units and any Class A Common Units repurchased will be canceled. During 2023, we repurchased and canceled a total of 114,900 Class A Common Units at an average price of approximately $9.09 per unit for a total purchase price of $1.0 million, including commissions, which is reflected as a reduction to the carrying value of our “Partners’ Capital - Common unitholders” on our Consolidated Balance Sheet as of December 31, 2023. We anticipate funding any future repurchase activity with a portion of our cash flows from operations and liquidity available under our senior secured credit facility.
Previous wording
On January 25, 2023, we issued $500 million in aggregate principal amount of our 8.875% senior unsecured notes due April 15, 2030 (the “2030 Notes”); interest payments are due April 15 and October 15 of each year. That issuance generated net proceeds of approximately $491 million, net of issuance costs incurred. The net proceeds were used to purchase approximately $316 million of our existing 2024 Notes, including the related accrued interest and tender premium and fees on those notes that were tendered in the tender offer that ended January 24, 2023 and the remaining proceeds at the time were used to repay a portion of the borrowings outstanding under our old revolving credit facility and for general partnership purposes. On January 26, 2023, we issued a notice of redemption for the remaining principal of approximately $25 million of our 2024 Notes, and discharged the indebtedness with respect to the 2024 Notes on February 14, 2023 by depositing the redemption amount with the trustee of the 2024 Notes for redemption of the 2024 Notes on February 25, 2023, all in accordance with the terms and conditions of the indenture governing the 2024 Notes.
Current wording
On May 9, 2024, we issued $700.0 million in aggregate principal amount of our 2032 Notes. Interest payments are due May 15 and November 15 of each year. The issuance of our 2032 Notes generated net proceeds of approximately $688 million, net of issuance costs incurred. The net proceeds were used to redeem all of our existing 2026 Notes, $339.3 million in principal amount of which were outstanding, and pay the related accrued interest. The remaining proceeds were used to repay a portion of the borrowings outstanding under our senior secured credit facility and for general partnership purposes.
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Rearranged current paragraphs (6)
Current report — wording carried from elsewhere
Additionally, in 2023 and 2024, we entered into several additional definitive agreements with existing producers to further commit the volumes transported on our offshore pipeline infrastructure (including our SYNC Pipeline and CHOPS Pipeline). The producer agreements include long term take-or-pay arrangements and, accordingly, we are able to receive a project completion credit for purposes of calculating the leverage ratio under our credit agreement throughout the construction period.
Current report — wording carried from elsewhere
Our sales volumes and prices can fluctuate from period to period and are dependent upon many factors, of which the main drivers are the global market and supply, customer demand, economic growth, and our ability to produce soda ash. Positive or negative changes to our revenue, through fluctuations in sales volumes or sales prices, can have a direct impact to Net income (loss), Segment Margin and Available Cash before Reserves as these fluctuations have a lesser impact to operating costs due to the fact that a portion of our costs are fixed in nature. Our costs, some of which are variable in nature and others are fixed in nature, relate primarily to the processing and producing of soda ash (and other alkali specialty products) and marketing, logistics and selling activities. In addition, costs include activities associated with mining and extracting trona ore, including energy costs and employee compensation. In our Alkali Business, during 2024, we experienced a decrease in revenues relative to 2023 primarily due to lower pricing on our export tons. This decrease was partially offset by higher sales volumes of soda ash as a result of the completion of our Granger Optimization Project (“GOP”) in the fourth quarter of 2023 and the subsequent ramp up in volumes during 2024, and higher domestic pricing. For additional information, see our segment-by-segment analysis below.
Current report — wording carried from elsewhere
We define Segment Margin as revenues less product costs, operating expenses and segment general and administrative expenses (all of which are net of the effects of our noncontrolling interest holders), plus or minus applicable Select Items (defined below in “Non-GAAP Financial Measures”). Although we do not necessarily consider all of our Select Items to be non-recurring, infrequent or unusual, we believe that an understanding of these Select Items is important to the evaluation of our core operating results. See “Non-GAAP Financial Measures” for further discussion surrounding total Segment Margin.
Current report — wording carried from elsewhere
During 2022, we entered into definitive agreements to provide transportation services for 100% of the crude oil production associated with two separate standalone deepwater developments that have a combined production capacity of approximately 160,000 barrels per day. In conjunction with these agreements, we are expanding the current capacity of the CHOPS Pipeline and constructing the SYNC Pipeline to connect one of the developments to our existing asset footprint in the Gulf of America.
Current report — wording carried from elsewhere
Additionally, in 2023 and 2024, we entered into several additional definitive agreements with existing producers to further commit the volumes transported on our offshore pipeline infrastructure (including our SYNC Pipeline and CHOPS Pipeline). The producer agreements include long term take-or-pay arrangements and, accordingly, we are able to receive a project completion credit for purposes of calculating the leverage ratio under our credit agreement throughout the construction period.
Current report — wording carried from elsewhere
We identified a feature within our Class A Convertible Preferred Units that was required to be bifurcated and recorded as an embedded derivative measured at fair value. Our final valuation of the embedded derivative occurred on September 29,
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
In our Alkali Business, we typically extract trona from our mining facilities, process into soda ash and other alkali products, and deliver and sell to our customers domestically and internationally. When we experience any differences in timing between the extraction, processing and sales of this trona or Alkali products, including the logistics and transportation to our customers, the cash requirements for these activities in the short term can be affected.