Product Sales Revenues

9 Months Ended

Sep. 30, 2015

Product Sales Revenue

The amounts reported as product sales revenue on our consolidated statements of income include revenue from the physical sale of petroleum products and from mark-to-market adjustments from New York Mercantile Exchange ("NYMEX") contracts. See Note 8 – Derivative Financial Instruments for a discussion of our commodity hedging strategies and how our NYMEX contracts impact product sales revenue. All of the petroleum products inventory we physically sell associated with our butane blending and fractionation activities, as well as the barrels from product gains we obtain from our independent and marine terminals, are reported as product sales revenue on our consolidated statements of income. The physical sale of the petroleum products inventory from product gains obtained from our pipeline operations and related activities from terminals physically connected to our pipeline system are reported as adjustments to operating expense.

For the three and nine months ended September 30, 2014 and 2015, product sales revenue included the following (in thousands):



	Three Months Ended					Nine Months Ended
	September 30,					September 30,
	2014			2015		2014		2015
Physical sale of petroleum products	$	108,320		$	100,829	$	555,870	$	403,395
NYMEX contract adjustments:
Change in value of NYMEX contracts that were not designated as hedging instruments associated with our butane blending and fractionation activities	47,546			71,902		33,703		52,432
Other	(1		)	—		12		—
Total NYMEX contract adjustments	47,545			71,902		33,715		52,432
Total product sales revenue	$	155,865		$	172,731	$	589,585	$	455,827