Energy Transfer LP

For information regarding legal proceedings, see our Annual Report on Form 10-K filed with the SEC on February 14, 2025 and Note 10 in “Item 1. Financial Statements” in this Quarterly Report on Form 10-Q for the quarter ended March 31, 2025.

Additionally, we have received notices of violations and potential fines under various federal, state and local provisions relating to the discharge of materials into the environment or protection of the environment. While we believe that even if any one or more of the following environmental proceedings were decided against us, it would not be material to our financial position, results of operations or cash flows, we are required to report governmental proceedings if we reasonably believe that such proceedings could result in monetary sanctions in excess of $1 million.

In January 2019, we received notice from the U.S. Department of Justice (“USDOJ”) on behalf of the EPA that a civil penalty enforcement action was being pursued under the Clean Water Act for an estimated 450 barrel crude oil release from the Mid Valley Pipeline operated by SPLP and owned by Mid Valley. The release purportedly occurred in October 2014 on a nature preserve located in Hamilton County, Ohio, near Cincinnati, Ohio. After discovery and notification of the release, SPLP conducted substantial emergency response, remedial work and primary restoration in three phases and the primary restoration has been acknowledged to be complete. In December 2019, SPLP reached an agreement in principal with the USEPA regarding payment of a civil penalty. In September 2024, after a public comment period, the United States District Court for the Southern District of Ohio (Western Division) entered a Consent Decree whereby SPLP and Mid Valley fully resolved both the civil penalty and alleged natural resource damages (NRD) which had been brought jointly by the USDOJ, on behalf of trustees of the United States, and the Ohio Attorney General, on behalf of the trustees of the State of Ohio. Total payments of approximately $3 million were made in satisfaction of the civil penalty and natural resource damages plus interest during November 2024 through February 2025. Operation and maintenance activities associated with the restoration are expected to continue for several years.

On October 28, 2022, the EPA issued a Notice of Proposed Debarment (“NPD”) arising from SPLP’s and ETC Northeast Pipeline, LLC’s nolo contendere plea agreements and convictions for violations of Pennsylvania’s Clean Streams Law related to the Revolution and Mariner 2 pipelines. The following entities were proposed for debarment: (1) SPLP (pleading entity); (2) ETC Northeast Pipeline, LLC (pleading entity); (3) Energy Transfer LP; (4) SemGroup LLC; and (5) LE GP, LLC. The NPD prevented the named entities from pursuing or renewing Federal government contracts or Federal financial assistance agreements. We engaged with the EPA to address the EPA’s concerns. On March 10, 2025, the EPA terminated the proposed debarments of the named entities and administratively closed the matter effective immediately.

On June 15, 2023, PHMSA issued a Notice of Probable Violation, Proposed Civil Penalty, and Proposed Compliance Order (collectively “NOPV”), CPF 4-2023-011-NOPV, identifying three probable violations with compliance order actions associated with two of them and civil penalties proposed in an amount totaling approximately $2 million. The NOPV related to a PHMSA Accident Investigation Division investigation of a pigging incident which occurred on March 26, 2020 at the Partnership’s Borcher Station in Kansas and resulted in a fatality. The Partnership challenged PHMSA’s alleged violations and related civil penalties and compliance order actions contained in the NOPV. After an administrative hearing, which was held on April 24, 2024 before a PHMSA Presiding Official, the PHMSA Southwest Region recommended to remain relatively firm on the NOPV, with only a slightly reduced civil penalty by approximately $19 thousand. The Partnership challenged the PHMSA administrative process in federal court, alleging among other things that PHMSA’s in-house administrative enforcement process was unconstitutional. In response, PHMSA has withdrawn the NOPV, terminated its in-house administrative action, and elected to file an enforcement action in federal court. The Partnership intends to defend this matter but remains open to a reasonable settlement to resolve the matter.

On October 13, 2023, Mid Valley Pipeline Company LLC, (“Mid Valley”) received a NOPSO from the PHMSA related to various historical accidents and complaints reported to PHMSA on the Mid Valley system. The NOPSO requests that Mid Valley perform several proposed corrective measures within six months of receipt of a Safety Order; however, in response, Mid Valley requested that PHMSA engage in informal consultations prior to issuing a Safety Order in an effort for the parties to potentially enter into a Consent Agreement and Order. Informal consultation is underway. In the event a Consent Agreement and Order is not reached between the parties during this process, Mid Valley may request a Hearing on the NOPSO. The informal consultation process has concluded with PHMSA and Mid Valley reaching agreement on the Corrective Measures. PHMSA issued the Consent Agreement which was signed by Mid Valley on March 21, 2025. The fully executed version of the Consent Agreement was received by Mid Valley on April 24, 2025.

On February 13, 2025, SPLP received a Notice of Proposed Safety Order (“NOPSO”) from PHMSA related to a release of jet fuel on the Twin Oaks Discharge pipeline system in Bucks County, Pennsylvania. The NOPSO made certain preliminary findings and proposes that SPLP take certain measures with respect to the system to ensure safety. SPLP engaged in informal settlement discussions with PHMSA and entered into a Consent Agreement that was finalized into a Consent Order on May 2, 2025. We cannot predict the outcome, timeline or costs associated with this administrative action.

On March 3, 2025, SPLP received an Administrative Order from the Pennsylvania Department of Environmental Protection regarding the release of jet fuel from the Twin Oaks Discharge pipeline system in Bucks County, Pennsylvania. SPLP has complied with all of the Interim Remedial Measures and Remediation requirements identified in the administrative order that were required to be completed as of the date of this submission. SPLP will continue to complete and comply all the requirements of the administrative order. We cannot predict the timeline or costs associated with this administrative order.

Pursuant to the instructions to Form 10-Q, matters disclosed in this Part II - Item 1 include any reportable legal proceeding (i) that has been terminated during the period covered by this report, (ii) that became a reportable event during the period covered by this report, or (iii) for which there has been a material development during the period covered by this report.

For additional information required in this Item, see disclosure under the headings “Litigation and Contingencies” and “Environmental Matters” in Note 10 to our consolidated financial statements in “Item 1. Financial Statements,” which information is incorporated by reference into this Item.