KINDER MORGAN, INC.
For the period ended Dec 31, 2025. Filed Feb 13, 2026.
View on SEC.govAbout this filing
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.
FY2025 · Filed Feb 13, 2026
KMI$30.57+2.0%Stored close · as of Nov 9, 2026
What changed in Risk Factors?
Read the current filingPrevious report: 10-K
Period ended 2024-12-31; filed 2025-02-13.
0001506307-25-000008
Item 1A. Risk FactorsCurrent report: 10-K
Period ended 2025-12-31; filed 2026-02-13.
0001506307-26-000011
Item 1A. Risk FactorsThe 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 113 previous paragraphs and 118 current paragraphs.
89 unchanged; 18 reworded; 11 added; 6 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 0 previous and 0 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 (11)
Current report
New or amended laws, policies, regulations and oversight requirements, and compliance complexity resulting from disparities in requirements imposed by federal, state, and local authorities, could adversely impact our earnings, cash flows, and operations.
Current report
Our assets and operations are subject to extensive and in some cases overlapping regulation and oversight by federal, state, and local authorities. Changes in the policy priorities of federal, state, and local authorities create a dynamic regulatory landscape—where, for example, federal priorities may ease while state and local requirements become more stringent—resulting in compliance complexity and potential cost increases.
Current report
Future administrations, court decisions, or state-level initiatives could reverse or tighten standards or result in enhanced requirements, creating uncertainty and volatility in compliance obligations and costs. For example, with respect to our products pipelines, the FERC resets the ceiling level calculation formula every five years, and the five-year review is typically the subject of litigation between liquids pipelines, their customers, and industry groups. Changes in the index formula used to calculate ceiling levels would impact the revenues we receive from FERC-jurisdictional service.
Current report
While policy shifts under the current U.S. presidential administration have generally emphasized support for domestic energy production and have reduced certain environmental regulatory burdens at the federal level, these changes introduce their own uncertainties. Deregulatory actions at the federal level, such as the EPA’s rescission of its previous endangerment finding relating to GHGs announced on February 12, 2026, are likely to be subject to legal challenges. Also, as the U.S. federal government has taken some steps to relax regulatory requirements, some states have adopted new laws and regulations. Many states have adopted policies related to GHG emission reduction targets. These and other expansion of U.S. state laws and regulations with potentially divergent obligations could require us to incur additional expenditures to comply with disparate obligations related to GHG emission requirements, or other reporting or safety regulations.
Current report
Changes in U.S. trade policy and the impact of tariffs may have a material adverse effect on our business and results of operations.
Current report
Our business and results of operations may be adversely affected by uncertainty and changes in U.S. trade policies, including tariffs, trade agreements, or other trade restrictions imposed by the U.S. or other governments. For example, in 2025, the U.S. government announced multiple tariffs on several foreign jurisdictions and imports into the U.S. Several of these tariff announcements have been followed by announcements of limited exemptions and temporary pauses. These actions have caused substantial uncertainty and volatility in financial markets. Additionally, in response to these actions, certain governments have announced retaliatory measures against the U.S. and/or are in the process of negotiating with the U.S on tariff agreements. While the U.S. government has announced various trade deals, many such agreements are preliminary and may be subject to change. Further, any future disagreement between the U.S. government and other countries over the implementation of trade deals or any failure to obtain required governmental approvals or otherwise reach a final agreement could result in prolonged uncertainty regarding the scope and duration of such trade actions by the U.S. government and other countries.
Current report
In August 2025, the U.S. Court of Appeals for the Federal Circuit ruled that many of the tariffs imposed under the Trump Administration exceed presidential authority and therefore are invalid, though the decision has been stayed pending U.S. Supreme Court review. This ruling introduces additional uncertainty as to the scope and durability of existing and future tariff measures.
Current report
Our business requires access to steel and other materials to construct and maintain our pipelines. Any imposition of or increase in tariffs on imports of steel or other materials, as well as corresponding price increases for such materials available domestically, could increase our construction costs and our costs to maintain our assets. To the extent that we are unable to pass all or any such cost increases on to our customers, such cost increases could adversely affect our returns on investment. Higher materials costs could also diminish our ability to develop new projects at acceptable returns, particularly during times of economic uncertainty, and limit our ability to pursue growth opportunities.
Current report
Tariffs or other trade restrictions may lead to continuing uncertainty and volatility in U.S. and global financial and economic conditions and commodity markets, declining consumer confidence, significant inflation, and diminished expectations for the economy, and ultimately reduced demand for our and our customers’ products and services. Such conditions could have a material adverse impact on our business, results of operations, and cash flows. Also, disruptions and volatility in the financial markets may lead to adverse changes in the availability, terms, and cost of capital. Such adverse changes could increase our costs of capital and limit our access to external financing sources to fund acquisitions, capital projects, or refinancing of debt maturities on similar terms, which could in turn reduce our cash flows and limit our ability to pursue growth opportunities.
Current report
Changes in tariffs and trade restrictions can be announced with little or no advance notice. The adoption and expansion of tariffs or other trade restrictions, increasing trade tensions, or other changes in governmental policies related to taxes, tariffs, trade agreements, or policies, are difficult to predict, which makes attendant risks difficult to anticipate and mitigate. If we are unable to navigate further changes in U.S. or international trade policy, it could have a material adverse impact on our business and results of operations.
Current report
Public attention with respect to climate matters has resulted in an overall increase in climate focused activities in recent years by interested stakeholders, including government authorities and private interest groups. These include efforts to implement new laws, regulations, and policies focused on enhanced disclosures related to climate matters. The commitment to such climate focused initiatives has varied over time, including with changes in U.S. presidential administrations and public priorities. At various times, the federal government, states, and groups of states have adopted or proposed climate related laws, regulations, or policies that could subject us to substantial compliance costs. For example, the SEC finalized rules requiring significant new climate-related disclosure in SEC filings, including certain climate-related metrics and GHG emissions data, and third-party attestation requirements. Although the SEC voluntarily stayed the effectiveness of such rules and has advised the U.S. Court of Appeals for the Eighth Circuit that it does not intend to reconsider or defend the rules, such rules or similar rules could be pursued in the future by the SEC or another government authority. See “New or amended laws, policies, regulations and oversight requirements, and compliance complexity resulting from disparities in requirements imposed by federal, state, and local authorities, could adversely impact our earnings, cash flows, and operations.” above for discussion of other state climate disclosure regulations that could subject us to substantial compliance costs.
Removed paragraphs (6)
Previous report
Our and our customers’ access to capital could be affected by evolving financial institutions’ policies concerning businesses linked to fossil fuels.
Previous report
Our and our customers’ access to capital could be affected by financial institutions’ evolving policies concerning businesses linked to fossil fuels. Concerns about the potential effects of climate change have caused some to direct their attention towards sources of funding for fossil-fuel energy companies, which has resulted in certain financial institutions, funds and other sources of capital restricting or eliminating their investment in such companies. Ultimately, this could make it more difficult for our customers to secure funding for exploration and production activities or for us to secure funding for growth projects, and consequently could both indirectly affect demand for our services and directly affect our ability to fund construction or other capital projects.
Previous report
New laws, policies, regulations, rulemaking and oversight, as well as changes to those currently in effect, could adversely impact our earnings, cash flows and operations.
Previous report
Our assets and operations are subject to extensive regulation and oversight by federal, state and local regulatory authorities. Legislative changes, as well as regulatory actions taken by these authorities, have the potential to adversely affect our profitability. Additional regulatory burdens and uncertainties will be created if and to the extent that more stringent energy and environmental and pipeline safety policies are enacted. In recent years, we saw an increase in the efforts of regulatory authorities to issue new regulations and guidance and to interpret existing laws and regulations in ways that promoted the use of renewable energy sources and further protection of the environment, called upon companies to increase monitoring and emissions reduction efforts, and increased investigations and enforcement actions for potential violations of environmental laws. For example, in December 2023, the EPA finalized a rule containing standards of performance for methane and volatile organic compound emissions from crude oil and natural gas sources, including the production, processing, and transmission and storage segments. In addition, a certain degree of regulatory uncertainty is created by the recent change in U.S. presidential administrations. It remains unclear specifically what the new administration may do with respect to future policies and regulations that may affect us.
Previous report
These types of rules and others that are currently proposed, if finalized, would affect our assets and operations indirectly, such as by increasing the costs associated with the production of natural gas and liquids that we transport, or directly, such as by increasing significantly our capital and operating costs associated with impacted equipment or subjecting us to the potential for regulatory penalties associated with the inability to comply with the rules in the timeframe allotted.
Previous report
The EPA’s final rule known as the “Good Neighbor Plan” (the Plan) was predicated on the EPA’s disapproval of numerous state implementation plans, or SIPs, submitted under the interstate transport (Good Neighbor) provisions of the Clean Air Act for the 2015 Ozone NAAQS and became effective on August 4, 2023. The Plan imposes prescriptive emission standards for several sectors, including new and existing reciprocating internal combustion engines of a certain size used in pipeline transportation of natural gas. The Plan’s emission standards would require installation of more stringent air pollution controls on hundreds of existing internal combustion engines used by our Natural Gas Pipelines business segment by May 1, 2026, except for any compliance schedule extensions granted by the EPA, which would need to be supported by us and approved by the EPA on an engine-by-engine basis. Multiple legal challenges have been filed, including by states seeking review of SIP disapprovals (12 of which have received stays pending review) and by us. On June 27, 2024, the Supreme Court granted a temporary stay of the Plan until a disposition of a review of the Plan by the U.S. Court of Appeals for the D.C. Circuit and any appeal of that decision to the Supreme Court. See Note 17, “Litigation and Environmental—Environmental Matters—Challenge to Federal “Good Neighbor Plan,” to our consolidated financial statements. On February 6, 2025, the EPA filed a motion asking the U.S. Court of Appeals for the D.C. Circuit to hold the cases in abeyance for 60 days to allow the Trump Administration time to familiarize themselves with the Plan, receive briefing from the EPA about the cases and the Plan, and decide what action on the Plan, if any, is necessary. If the Plan were to remain in effect in its current form (including full compliance by a revised compliance deadline accounting for the stays, and assuming failure of all pending challenges to SIP disapprovals and no successful challenge to the Plan), we currently estimate that the Plan would have a material adverse impact on us. See Item 7. “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources—Capital Expenditures—Impact of Regulation.” We are unable to predict whether pending legal challenges will ultimately result in changes to the Plan or how those changes, if any, would impact us.
Reworded paragraphs (18)
Previous wording
Conditions in the business environment generally, such as declining or sustained low commodity prices, supply disruptions, or higher development or production costs, could result in a slowing of supply to our pipelines, terminals and other assets. Also, sustained lower demand for hydrocarbons, or changes in the regulatory environment or applicable governmental policies, including in relation to climate change or other environmental concerns, may have a negative impact on the supply of crude oil and other products. Public concern about the potential risks posed by climate change has resulted in increased demand for energy efficiency and a transition to energy provided from renewable energy sources rather than fossil fuels, fuel-efficient alternatives such as hybrid and electric vehicles, and pursuit of other technologies to reduce GHG emissions, such as carbon capture and sequestration. We have seen and may see further intensification of these trends.
Current wording
Conditions in the business environment generally, such as declining or sustained low commodity prices, supply disruptions, or higher development or production costs, could result in a slowing of supply to our pipelines, terminals, and other assets. Also, sustained lower demand for hydrocarbons, or changes in the regulatory environment or applicable government policies and priorities, including in relation to climate change or other environmental concerns, may have a negative impact on the supply of crude oil and other products. In recent years, public concern about the potential risks posed by climate change has resulted in increased demand for energy efficiency and a transition to energy provided from renewable energy sources rather than fossil fuels, fuel-efficient alternatives such as hybrid and electric vehicles, and pursuit of other technologies to reduce GHG emissions, such as carbon capture and sequestration.
Previous wording
We regularly undertake construction projects to expand our existing assets and to construct new assets. New growth projects generally will be subject to, among other things, the receipt of regulatory approvals, feasibility and cost analyses, funding availability, industry, market and demand conditions, and environmental justice considerations. A variety of factors outside of our control, such as difficulties in obtaining rights-of-way and permits or other regulatory approvals, have caused, and may continue to cause, delays in or cancellations of our construction projects. Regulatory authorities may modify their permitting policies in ways that disadvantage our construction projects. Federal regulators may also expand existing regulatory requirements, such as PHMSA’s recent expansion of gas gathering pipeline regulation and the Congressional mandate under the Pipeline Safety Act that PHMSA regulate the transportation of gaseous CO 2. Such factors can be exacerbated by public opposition to our projects. See “—We are subject to reputational risks and risks relating to public opinion.” Inclement weather, natural disasters and delays in performance by third-party contractors have also resulted in, and may continue to result in, increased costs or delays in construction. In addition, we may experience increasing costs for construction materials, including cost increases associated with increased tariffs (such as those proposed by the new U.S. presidential administration). Significant increases in costs of construction materials, cost overruns or delays, or our inability to obtain a required permit or right-of-way, could have a material adverse effect on our return on investment, results of operations and cash flows, and could result in project cancellations or otherwise limit our ability to pursue growth opportunities.
Current wording
We regularly undertake construction projects to expand our existing assets and to construct new assets. These projects generally will be subject to, among other things, the receipt of regulatory approvals, feasibility and cost analyses, funding availability, industry, market and demand conditions, and environmental considerations. A variety of factors outside of our control, such as difficulties in obtaining rights-of-way and permits or other regulatory approvals, have caused, and may continue to cause, delays in or cancellations of our construction projects. Regulatory authorities may modify their permitting policies in ways that disadvantage our construction projects. Federal regulators may also expand existing regulatory requirements, such as PHMSA’s 2021 expansion of gas gathering pipeline regulation and the Congressional mandate under the Pipeline Safety Act that PHMSA regulate the transportation of gaseous CO 2. Such factors can be exacerbated by public opposition to our projects. See “—We are subject to reputational risks and risks relating to public opinion.” Inclement weather, natural disasters, and delays in performance by third-party contractors have also resulted in, and may in the future result in, increased costs or delays in construction. In addition, we have experienced increasing costs for construction materials, including cost increases associated with increased tariffs (such as those discussed under “—Changes in U.S. trade policy and the impact of tariffs may have a material adverse effect on our business and results of operations.”) and may continue to experience such cost impacts. Significant increases in costs of construction materials, cost overruns or delays, or our inability to obtain a required permit or right-of-way, could have a material adverse effect on our return on investment, results of operations, and cash flows, and could result in project cancellations or otherwise limit our ability to pursue growth opportunities.
Previous wording
Sharp declines in the prices of crude oil, NGL or natural gas, or a prolonged unfavorable price environment, may result in a commensurate reduction in our revenues, income and cash flows from our businesses that produce, process, or purchase and sell crude oil, NGL, or natural gas, and could have a material adverse effect on the carrying value (which includes assigned goodwill) of our CO 2 business segment’s proved reserves, certain assets in certain midstream businesses within our Natural Gas Pipelines business segment, and certain assets within our Products Pipelines business segment.
Current wording
Sharp declines in the prices of crude oil, NGL, or natural gas, or a prolonged unfavorable price environment, may result in a commensurate reduction in our revenues, income, and cash flows from our businesses that produce, process, or purchase and sell crude oil, NGL, or natural gas, and could have a material adverse effect on the carrying value (which includes assigned goodwill) of our CO 2 business segment’s proved reserves, and to a lesser extent, certain assets in certain midstream businesses within our Natural Gas Pipelines business segment and certain assets within our Products Pipelines business segment.
Previous wording
There are a variety of hazards and operating risks inherent to the transportation and storage of the products we handle, such as leaks; releases; the breakdown, underperformance or failure of equipment, facilities, information systems or processes; damage to our pipelines caused by third-party construction; the compromise of information and control systems; spills at terminals and hubs; spills associated with loading and unloading harmful substances at rail facilities; adverse sea conditions (including storms and rising sea levels) and releases or spills from our shipping vessels or vessels loaded at our marine terminals; operator error; labor disputes/work stoppages; disputes with interconnected facilities and carriers; operational disruptions or apportionment on third-party systems or refineries on which our assets depend; and catastrophic events or natural disasters such as fires, floods, explosions, earthquakes, acts of terrorists and saboteurs, cyber security breaches, and other similar events, many of which are beyond our control. Additional risks to our vessels include capsizing, grounding and navigation errors.
Current wording
There are a variety of hazards and operating risks inherent to the transportation and storage of the products we handle, such as leaks; releases; the breakdown, underperformance or failure of equipment, facilities, information systems, or processes; damage to our pipelines caused by third-party construction; the compromise of information and control systems; spills at terminals and hubs; spills associated with loading and unloading harmful substances at rail facilities; adverse sea conditions (including storms and rising sea levels) and releases or spills from our shipping vessels or vessels loaded at our marine terminals; operator error; labor disputes/work stoppages; disputes with interconnected facilities and carriers; operational disruptions or apportionment on third-party systems or refineries on which our assets depend; and catastrophic events or natural disasters such as fires, floods, explosions, earthquakes, acts of terrorists and saboteurs, cyber security breaches, and other similar events, many of which are beyond our control. Additional risks to our vessels include capsizing, collision, allision, grounding, and navigation errors.
Previous wording
Unfavorable conditions such as a general slowdown of the global or U.S. economy, uncertainty and volatility in the financial markets, or inflation and rising interest rates, could materially adversely affect our operating results. For example, the global economic downturn caused by the coronavirus pandemic in 2020 affected numerous industries, including the crude oil and gas industry, the steel industry and specific segments and markets in which we operate, resulting in reduced demand and increased price competition for our products and services. Also, economic conditions in the wake of the pandemic included inflationary pressure, which resulted in higher operating expenses and project costs for us, as well as higher interest rates. More recently, we may see increasing market uncertainty and volatility due to possible shifts in U.S. and foreign trade, economic and other policies following the recent change in U.S. presidential administration.
Current wording
Unfavorable conditions such as a general slowdown of the global or U.S. economy, uncertainty and volatility in the financial markets, or inflation and rising interest rates, could materially adversely affect our operating results. For example, the global economic downturn caused by the coronavirus pandemic in 2020 affected numerous industries, including the crude oil and gas industry, the steel industry, and specific segments and markets in which we operate, resulting in reduced demand and increased price competition for our products and services. Also, economic conditions in the wake of the pandemic included inflationary pressure, which resulted in higher operating expenses and project costs for us, as well as higher interest rates. More recently, we may see increasing market uncertainty and volatility due to shifts in U.S. and foreign trade, economic, and other policies. See “—Changes in U.S. trade policy and the impact of tariffs may have a material adverse effect on our business and results of operations.”
Previous wording
We believe that reputational risk cannot be managed in isolation from other forms of risk and that credit, market, operational, insurance, regulatory and legal risks, among others, must all be managed effectively to safeguard our reputation. Our reputation and public opinion could also be impacted by the actions and activities of other companies operating in the energy industry, particularly other energy infrastructure providers, over which we have no control. In particular, our reputation could be impacted by negative publicity related to pipeline incidents or unpopular expansion projects and due to opposition to development of hydrocarbons and energy infrastructure, particularly projects involving resources that are considered to increase GHG emissions and contribute to climate change. Negative impacts from a compromised reputation or changes in public opinion (including with respect to the production, transportation and use of hydrocarbons generally) could include increased regulatory oversight and costs, difficulty obtaining rights-of-way and delays in obtaining, or challenges to, regulatory approvals with respect to growth projects, blockades, project cancellations, difficulty securing financing, revenue loss, reduction in customer base, and decreased value of our securities and our business. In the past, governmental agencies have responded to environmental justice concerns by imposing greater scrutiny in the permit approval process and enforcement actions that could exacerbate the negative reputational impacts, and they may do so in the future.
Current wording
We believe that reputational risk cannot be managed in isolation from other forms of risk and that credit, market, operational, insurance, regulatory, and legal risks, among others, must all be managed effectively to safeguard our reputation. Our reputation and public opinion could also be impacted by the actions and activities of other companies operating in the energy industry, particularly other energy infrastructure providers, over which we have no control. In particular, our reputation could be impacted by negative publicity related to pipeline incidents or unpopular expansion projects and due to opposition to development of hydrocarbons and energy infrastructure, particularly projects involving resources that are considered to increase GHG emissions and contribute to climate change. Negative impacts from a compromised reputation or changes in public opinion (including with respect to the production, transportation, and use of hydrocarbons generally) could include increased regulatory oversight and costs, difficulty obtaining rights-of-way and delays in obtaining, or challenges to, regulatory approvals with respect to growth projects, blockades, project cancellations, difficulty securing financing, revenue loss, reduction in customer base, and decreased value of our securities and our business.
Previous wording
As of December 31, 2024, we had approximately $31.8 billion of consolidated debt (excluding debt fair value adjustments), including $1.5 billion of senior notes maturing within the next 12 months, and approximately $3.6 billion of debt subject to variable interest rates, either as short-term or long-term variable-rate debt obligations, or as long-term fixed-rate debt effectively converted to variable rates through the use of interest rate swaps. In response to increasing inflation, the U.S. Federal Reserve raised interest rates over the period from March 2022 to July 2023 before beginning rate reductions in September 2024 due to slowing inflation. There can be no assurance that the U.S. Federal reserve will continue rate reductions, will not resume rate increases or regarding the pace at which any such reductions or increases could occur. If and to the extent that interest rates increase, our costs to refinance maturities of existing indebtedness may also increase, as will the amount of cash required to service variable-rate debt, and our earnings and cash flows could be adversely affected.
Current wording
As of December 31, 2025, we had approximately $31.8 billion of consolidated debt (excluding debt fair value adjustments), including $1.1 billion of senior notes maturing within the next 12 months, and approximately $3.5 billion of debt subject to variable interest rates, either as short-term or long-term variable-rate debt obligations, or as long-term fixed-rate debt effectively converted to variable rates through the use of interest rate swaps. The U.S. Federal Reserve raised interest rates over the period from March 2022 to July 2023 in response to increasing inflation, then reduced rates beginning in September 2024 as inflation slowed and the labor market weakened. Although rate reductions continued through December 2025, there can be no assurance that the U.S. Federal Reserve will continue rate reductions, or will not resume rate increases, or regarding the pace at which any such reductions or increases could occur. If and to the extent that interest rates increase, our costs to refinance maturities of existing indebtedness may also increase, as will the amount of cash required to service variable-rate debt, and our earnings and cash flows could be adversely affected.
Previous wording
Our existing rates may also be challenged by complaint or protest. Regulators and shippers on our pipelines have rights to challenge, and have challenged, the rates we charge under certain circumstances prescribed by applicable regulations. Some shippers on our pipelines have filed complaints with the regulators seeking prospective reductions in the tariff rates and, in the case of a protest to a rate filing, seeking substantial refunds for alleged overcharges during the years in question. Further, the FERC has initiated and may continue to initiate investigations to determine whether our interstate natural gas pipeline rates are just and reasonable. Please read Note 17 “Litigation and Environmental” to our consolidated financial statements for a description of material pending challenges to the rates we charge on our pipelines. We are unable to predict the extent to which these proceedings will result in lower transportation rates on our pipelines, and in the case of a protest, refunds for alleged overcharges. Any successful challenge to our rates could materially adversely affect our future earnings, cash flows and financial condition.
Current wording
Our existing rates may also be challenged by complaint or protest. Regulators and shippers on our pipelines have rights to challenge, and have challenged, the rates we charge under certain circumstances prescribed by applicable regulations. Some shippers on our pipelines have filed complaints with the regulators seeking prospective reductions in the tariff rates and, in the case of a protest to a rate filing, seeking substantial refunds for alleged overcharges during the years in question. Further, the FERC has initiated and may continue to initiate investigations to determine whether our interstate natural gas pipeline rates are just and reasonable. We are unable to predict the extent to which these proceedings will result in lower transportation rates on our pipelines, and in the case of a protest, refunds for alleged overcharges. Any successful challenge to our rates could materially adversely affect our future earnings, cash flows, and financial condition.
Previous wording
In March 2024, the SEC finalized rules requiring significant new climate-related disclosure in SEC filings, including certain climate-related metrics and GHG emissions data, and third-party attestation requirements. In April 2024, the SEC voluntarily stayed the effectiveness of the new rules, pending judicial review, and on February 11, 2025, the Acting Chairman of the SEC directed the SEC staff to request that the court not schedule the case for argument to provide time for the SEC to deliberate and determine the appropriate next steps in the cases. The State of California also has enacted legislation requiring climate-related disclosures. Other U.S. states have announced similar proposed regulations. These types of regulations may expose us to significant additional compliance costs. Some customers and other third parties also have begun requesting disclosures from us related to their own reporting obligations. At this time, we cannot predict the costs of compliance with, or other potential adverse impacts resulting from, these or similar future rules that may be adopted.
Current wording
For example, the EPA finalized methane and volatile organic compound emissions standards in late 2023 and, although EPA priorities have shifted under the current U.S. presidential administration, several states continue to pursue aggressive climate and emissions-reduction programs, which could require us to comply with obligations that are more stringent than those imposed by the EPA. The State of California has enacted legislation requiring climate-related disclosures, and the California Air Resources Board (CARB) has begun implementation of such legislation, which requires that certain companies doing business in California submit reporting of GHG emissions. Other U.S. states have announced similar proposed regulations. These types of regulations may expose us to significant additional compliance costs. In addition, some customers and other third parties request disclosures from us related to their own reporting obligations. At this time, we cannot predict the costs of compliance with, or other potential adverse impacts resulting from, these or similar future rules that may be adopted.
Previous wording
These and other initiatives of regulatory authorities may affect our assets and operations directly or indirectly, such as by preventing or delaying the exploration for and production of natural gas and liquids that we transport or expanding regulation of existing infrastructure or new sources that are not currently regulated.
Current wording
These and other initiatives of regulatory authorities may affect our assets and operations directly or indirectly, such as by preventing or delaying the exploration for and production of natural gas and liquids that we transport or expanding regulation of existing infrastructure or new sources that are not currently regulated. Moreover, political and legal challenges to existing rules, combined with evolving public expectations around environmental stewardship, add to the risk that new or reinstated regulations could materially impact our operations.
Previous wording
Regulation affects almost every part of our business. In addition to environmental and pipeline safety matters, we are subject to regulations extending to such matters as (i) federal, state, local and foreign taxation; (ii) rates (which include reservation, commodity, surcharges, fuel and gas lost and unaccounted for), operating terms and conditions of service; (iii) the types of services we may offer to our customers; (iv) the contracts for service entered into with our customers; (v) the certification and construction of new facilities; (vi) the costs of raw materials, such as steel, which may be affected by tariffs (such as those proposed by the new U.S. presidential administration) or otherwise; (vii) the integrity, safety and security (including against cyber-attacks) of facilities and operations; (viii) the acquisition of other businesses; (ix) the acquisition, extension, disposition or abandonment of services or facilities; (x) reporting and information posting requirements; (xi) the maintenance of accounts and records; and (xii) relationships with affiliated companies involved in various aspects of the natural gas and energy businesses.
Current wording
Regulation affects almost every part of our business. In addition to environmental and pipeline safety matters, we are subject to regulations extending to such matters as (i) federal, state, local and foreign taxation; (ii) rates, operating terms, and conditions of service we may offer to our customers; (iii) the types of services and contracts we may offer to our customers; (iv) permitting, certification, and construction of new facilities; (v) the costs of raw materials, such as steel, which may be affected by tariffs (such as those discussed under “—Changes in U.S. trade policy and the impact of tariffs may have a material adverse effect on our business and results of operations.”) or otherwise; (vi) the integrity, safety and security (including against cyber-attacks) of facilities and operations; (vii) the acquisition of other businesses; (viii) the acquisition, extension, disposition, or abandonment of services or facilities; (ix) reporting and information posting requirements; (x) the maintenance of accounts and records; and (xi) relationships with affiliated companies involved in various aspects of the natural gas and energy businesses.
Previous wording
If we fail to comply with any applicable statutes, rules, regulations, and orders of such regulatory authorities, we could be subject to substantial penalties and fines and potential loss of government contracts. New laws or regulations, or different interpretations of existing laws or regulations, including unexpected policy changes, applicable to our income, operations, assets or another aspect of our business could have a material adverse impact on our earnings, cash flow, financial condition and results of operations. For more information, see Items 1 and 2. “Business and Properties—Narrative Description of Business—Industry Regulation.”
Current wording
If we fail to comply with any applicable laws or regulations, and orders of such regulatory authorities, we could be subject to substantial penalties and fines and potential loss of government contracts. New or amended laws or regulations, or different interpretations of existing laws or regulations, including policy changes, applicable to our business could have a material adverse impact on our earnings, cash flow, financial condition, and results of operations. For more information, see Items 1 and 2. “Business and Properties—Narrative Description of Business—Industry Regulation.”
Previous wording
Our operations are subject to extensive federal, state and local laws, regulations and potential liabilities arising under or relating to the protection or preservation of the environment, natural resources and human health and safety. Such laws and regulations affect many aspects of our past, present and future operations, and generally require us to obtain and comply with various environmental registrations, licenses, permits, inspections and other approvals. It is possible that costs associated with complying with the aforementioned laws will change depending on the emphasis regulatory authorities are placing on protection of the environment and environmental justice considerations. Liability under such laws and regulations may be incurred without regard to fault under CERCLA, the Resource Conservation and Recovery Act, the Federal Clean Water Act, the Oil Pollution Act, or analogous state laws, as a result of the presence or release of hydrocarbons or hazardous substances into or through the environment, and these laws may require response actions and remediation and may impose liability for natural resource and other damages. Private parties, including the owners of properties through which our pipelines pass, also may have the right to pursue legal actions to enforce compliance as well as to seek damages for non-compliance with such laws and regulations or for personal injury or property damage. Our insurance may not cover all environmental risks and costs and/or may not provide sufficient coverage in the event an environmental claim is made against us.
Current wording
Our operations are subject to extensive federal, state, and local laws, regulations, and potential liabilities arising under or relating to the protection or preservation of the environment, natural resources, and human health and safety. Such laws and regulations affect many aspects of our past, present, and future operations, and generally require us to obtain and comply with various environmental registrations, licenses, permits, inspections, and other approvals. It is possible that costs associated with complying with the aforementioned laws will change depending on the emphasis regulatory authorities are placing on protection of the environment. Liability under such laws and regulations may be incurred without regard to fault under CERCLA, the Resource Conservation and Recovery Act, the Federal Clean Water Act, the Oil Pollution Act, or analogous state laws, as a result of the presence or release of hydrocarbons or hazardous substances into or through the environment, and these laws may require response actions and remediation and may impose liability for natural resource and other damages. Private parties, including the owners of properties through which our pipelines pass, also may have the right to pursue legal actions to enforce compliance as well as to seek damages for non-compliance with such laws and regulations or for personal injury or property damage. Our insurance may not cover all environmental risks and costs and/or may not provide sufficient coverage in the event an environmental claim is made against us.
Previous wording
We are subject to extensive laws and regulations related to pipeline safety and integrity at the federal and state levels. There are, for example, regulations issued by PHMSA for pipeline operators in the areas of design, operations, maintenance, integrity management, qualification and training, emergency response, control room management, and public awareness. We expect the costs of compliance with these regulations, including integrity management rules, will continue to be substantial. The majority of compliance costs relate to pipeline integrity management regulations, which include enhanced assessment and repair requirements in HCAs, and compliance with recently issued regulations which impose additional assessment and repair criteria for gas pipelines in MCAs. Technological advances in in-line inspection tools, identification of additional threats to a pipeline’s integrity and changes to the amount of pipeline determined to be located in HCAs or MCAs can have a significant impact on integrity testing and repair costs. Repairs or upgrades deemed necessary to address results of integrity assessments and other testing and/or ensure the continued safe and reliable operation of our pipelines and pipeline facilities could cause us to incur significant and unanticipated capital and operating expenditures. Such expenditures will vary depending on the number of repairs determined to be necessary as a result of integrity assessments and other testing. We also anticipate incurring substantial costs associated with PHMSA’s requirements for reconfirming the MAOP of certain gas pipelines.
Current wording
We are subject to extensive laws and regulations related to pipeline safety and integrity at the federal and state levels. There are, for example, regulations issued by PHMSA for pipeline operators in the areas of design, operations, maintenance, integrity management, qualification and training, emergency response, control room management, and public awareness. We expect the costs of compliance with these regulations, including integrity management rules, will continue to be substantial. The majority of compliance costs relate to enhanced assessment and repair requirements in HCAs (pursuant to PHMSA’s integrity management regulations) and MCAs. Technological advances in in-line inspection tools, identification of additional threats to a pipeline’s integrity, and changes to the amount of pipeline determined to be located in HCAs or MCAs can have a significant impact on integrity testing and repair costs. Repairs or upgrades deemed necessary to address results of integrity assessments and other testing and/or ensure the continued safe and reliable operation of our pipelines and pipeline facilities could cause us to incur significant and unanticipated capital and operating expenditures. Such expenditures will vary depending on the number of repairs determined to be necessary as a result of integrity assessments and other testing. We also anticipate incurring substantial costs associated with PHMSA’s requirements for reconfirming the MAOP of certain gas pipelines.
Previous wording
Further, additional laws and regulations that may be enacted in the future or a new interpretation of existing laws and regulations could significantly increase our compliance expenditures. Pipeline safety regulations or changes to such regulations may require additional leak detection, reporting, the replacement of certain pipeline segments or equipment, addition of monitoring equipment and more frequent monitoring, inspection or testing of our pipeline facilities. Repair, remediation, and preventative or mitigating actions may require significant capital and operating expenditures. Pipeline safety regulation has increased over time, including recent revised gas and hazardous liquid regulations that we must timely implement, and existing obligations may increase with new proposed rules that are currently under consideration. For example, PHMSA has issued a proposed rulemaking with expansive pipeline leak detection and repair requirements that is proposed to be applicable to gas pipelines, LNG facilities and underground natural gas storage facilities. PHMSA is also working on a final rulemaking regarding requirements for pipelines located in coastal ecological unusually sensitive areas, as well as a final rule that updates requirements for responding to changes in class location for gas pipelines. In addition, PHMSA is working on a number of proposed rulemakings, including those related to (i) updating regulations for LNG facilities; (ii) requirements for idled gas and liquid pipelines; (iii) revising requirements for transportation of CO 2 in the liquid phase as well as establishing regulation of the transportation of gaseous CO 2; (iv) oil spill response plans; and (v) liquid pipeline repair criteria.
Current wording
Further, additional laws and regulations that may be enacted in the future or a new interpretation of existing laws and regulations could significantly increase our compliance expenditures. Pipeline safety regulations or changes to such regulations may require additional leak detection, reporting, the replacement of certain pipeline segments or equipment, addition of monitoring equipment, and more frequent monitoring, inspection or testing of our pipeline facilities. Repair, remediation, and preventative or mitigating actions may require significant capital and operating expenditures. Pipeline safety regulation has increased over time, including recent revised gas and hazardous liquid regulations that we must timely implement, and existing obligations may increase with new proposed rules that are currently under consideration. For example, PHMSA has issued a proposed rulemaking with expansive pipeline leak detection and repair requirements that is proposed to be applicable to gas pipelines, LNG facilities and underground natural gas storage facilities. PHMSA is also working on a final rule regarding requirements for pipelines located in coastal ecological unusually sensitive areas and a rulemaking that seeks to update the repair criteria applicable to hazardous liquid and gas pipelines.
Previous wording
Congress is working on the reauthorization of the Pipeline Safety Act, which is expected to be enacted in 2025 and could further expand PHMSA’s current rulemaking agenda and/or statutory authority in certain areas. There can be no assurance as to the amount or timing of future expenditures for pipeline safety and integrity regulation, and actual future expenditures may be different from the amounts we currently anticipate. Revised or additional regulations that result in increased compliance costs or additional operating restrictions, particularly if those costs are not deemed by regulators to be fully recoverable from our customers, could have a material adverse effect on our business, financial position, results of operations and prospects.
Current wording
Additionally, Congress is working on the reauthorization of the Pipeline Safety Act, which could further expand PHMSA’s current rulemaking agenda and/or statutory authority in certain areas. There can be no assurance as to the amount or timing of future expenditures for pipeline safety and integrity regulation, and actual future expenditures may be different from the amounts we currently anticipate. Revised or additional regulations that result in increased compliance costs or additional operating restrictions, particularly if those costs are not deemed by regulators to be fully recoverable from our customers, could have a material adverse effect on our business, financial position, results of operations, and prospects.
Previous wording
Climate-related risks and related regulation could result in significantly increased operating and capital costs for us and could reduce demand for our products and services.
Current wording
Climate-related risks and related regulation could result in significantly increased operating, capital, and other costs for us and could reduce demand for our products and services.
Previous wording
Various laws and regulations exist or are under development that seek to regulate the emission of GHGs such as methane and CO 2, including the EPA programs to control GHG emissions, PHMSA’s existing leak detection and repair requirements and additional requirements proposed by PHMSA in accordance with its Congressional mandate, state actions to develop statewide or regional programs, and regulations by foreign governments that restrict imports. Existing EPA regulations require us to report GHG emissions in the U.S. from sources such as our larger natural gas compressor stations, fractionated NGL, and production of naturally occurring CO 2 (for example, from our McElmo Dome CO 2 field), even when such production is not emitted to the atmosphere. In addition, the European Union has approved a law to impose limits on methane emissions applicable to imports of natural gas and crude oil beginning in 2030. Proposed approaches to further address GHG emissions include establishing GHG “cap-and-trade” programs, increased efficiency standards, participation in international climate agreements and incentives or mandates for pollution reduction, use of renewable energy sources or use of alternative fuels with lower carbon content. For more information about climate change regulation, see Items 1 and 2. “Business and Properties—Narrative Description of Business—Environmental Matters—Climate Change.”
Current wording
Various laws and regulations exist or are under development that seek to regulate the emission of GHGs such as methane and CO 2, including the EPA programs to control GHG emissions, PHMSA’s existing leak detection and repair requirements, and additional requirements proposed by PHMSA in accordance with its Congressional mandate, state actions to develop statewide or regional programs, and regulations by foreign governments that restrict imports. Although the EPA recently announced its intention to reconsider certain findings underlying the agency’s regulation of GHGs, as well as mandatory GHG reporting requirements, the EPA’s current regulations require us to report GHG emissions in the U.S. from sources such as our larger natural gas compressor stations, fractionated NGL, and production of naturally occurring CO 2 (for example, from our McElmo Dome CO 2 field), even when such production is not emitted to the atmosphere. In addition, the European Union has approved a law to impose limits on methane emissions applicable to imports of natural gas and crude oil beginning in 2030. Proposed approaches to further address GHG emissions include establishing GHG “cap-and-trade” programs, increased efficiency standards, participation in international climate agreements, and incentives or mandates for pollution reduction, use of renewable energy sources or use of alternative fuels with lower carbon content. For more information about climate change regulation, see Items 1 and 2. “Business and Properties—Narrative Description of Business—Environmental Matters—Climate Change.”