Revenues for the third quarter of 2013 increased 16 percent to $12.1 billion from $10.5 billion in the same quarter of 2012 primarily attributable to higher NGL and crude oil sales volumes. Periodic changes in our revenues and operating costs and expenses are also explained in part by changes in energy commodity prices. Excluding the impact of changes in sales volumes between periods, higher energy commodity prices result in an increase in our revenues attributable to the sale of NGLs, natural gas, crude oil, petrochemicals and refined products; likewise, these higher commodity prices also can increase the associated cost of sales as purchase costs rise.
Gross operating margin for the third quarter of 2013 was $1.2 billion compared to $1.1 billion for the third quarter of last year. Adjusted earnings before interest, taxes and depreciation (“Adjusted EBITDA”) was $1.1 billion for the third quarters of 2013 and 2012. Gross operating margin and Adjusted EBITDA are non-GAAP financial measures that are discussed and reconciled later in this press release.
Review of Segment Performance for the Third Quarter of 2013
NGL Pipelines & Services – Gross operating margin for the NGL Pipelines & Services segment was $640 million for the third quarter of 2013 compared to $616 million for the same quarter of 2012.Enterprise’s natural gas processing and related NGL marketing business generated gross operating margin of $293 million for the third quarter of 2013 compared to $352 million for the third quarter of 2012. This decrease was largely due to the effects of (1) lower natural gas processing margins as a result of higher natural gas prices and lower prices for ethane, normal butane and isobutane; (2) lower proceeds from hedging activities; and (3) lower equity NGL production (the NGLs that Enterprise earns title to as a result of providing processing services) at certain processing plants in the third quarter of 2013 compared to the third quarter of 2012. Our three processing plants in the Rocky Mountains (Meeker, Pioneer and Chaco) reported a $77 million decrease in gross operating margin compared to the third quarter of 2012. This decrease in gross operating margin was partially offset by an aggregate $17 million increase in gross operating margin from the partnership’s NGL marketing business on higher sales volumes and from our processing plants in South Texas on increases in fee-based natural gas processing volumes and equity NGL production.