Business Segment Information

The Company reports financial results for five segments: Exploration and Production, Pipeline and Storage, Gathering, Utility and Energy Marketing. The division of the Company’s operations into reportable segments is based upon a combination of factors including differences in products and services, regulatory environment and geographic factors.

The Exploration and Production segment, through Seneca, is engaged in exploration for and development of natural gas and oil reserves in California and the Appalachian region of the United States.

The Pipeline and Storage segment operations are regulated by the FERC for both Supply Corporation and Empire. Supply Corporation transports and stores natural gas for utilities (including Distribution Corporation), natural gas marketers (including NFR), exploration and production companies (including Seneca) and pipeline companies in the northeastern United States markets. Empire transports and stores natural gas for major industrial companies, utilities (including Distribution Corporation) and power producers in New York State. Empire also transports natural gas for natural gas marketers along with exploration and production companies from natural gas producing areas in Pennsylvania to markets in New York and to interstate pipeline delivery points for additional markets in the northeastern United States and Canada.

The Gathering segment is comprised of Midstream Corporation’s operations. Midstream Corporation builds, owns and operates natural gas processing and pipeline gathering facilities in the Appalachian region and currently provides gathering services to Seneca.

The Utility segment operations are regulated by the NYPSC and the PaPUC and are carried out by Distribution Corporation. Distribution Corporation sells natural gas to retail customers and provides natural gas transportation services in western New York and northwestern Pennsylvania.

The Energy Marketing segment is comprised of NFR’s operations. NFR markets natural gas to industrial, wholesale, commercial, public authority and residential customers primarily in western and central New York and northwestern Pennsylvania, offering competitively priced natural gas for its customers.

The data presented in the tables below reflects financial information for the segments and reconciliations to consolidated amounts. The accounting policies of the segments are the same as those described in Note A — Summary of Significant Accounting Policies. Sales of products or services between segments are billed at regulated rates or at market rates, as applicable. The Company evaluates segment performance based on income before discontinued operations, extraordinary items and cumulative effects of changes in accounting (when applicable). When these items are not applicable, the Company evaluates performance based on net income.



	Year Ended September 30, 2017
	Exploration and Production		Pipeline and Storage		Gathering		Utility		Energy Marketing		Total Reportable Segments		All Other			Corporate and Intersegment Eliminations			Total Consolidated
	(Thousands)
Revenue from External Customers(1)	$	614,599	$	206,615	$	115	$	626,899	$	128,586	$	1,576,814	$	2,173		$	894		$	1,579,881
Intersegment Revenues	$	—	$	87,810	$	107,566	$	13,072	$	794	$	209,242	$	—		$	(209,242	)	$	—
Interest Income	$	707	$	1,467	$	994	$	1,051	$	571	$	4,790	$	213		$	(890	)	$	4,113
Interest Expense	$	53,702	$	33,717	$	9,142	$	28,492	$	47	$	125,100	$	—		$	(5,263	)	$	119,837
Depreciation, Depletion and Amortization	$	112,565	$	41,196	$	16,162	$	52,582	$	279	$	222,784	$	661		$	750		$	224,195
Income Tax Expense (Benefit)	$	66,093	$	40,947	$	29,694	$	24,894	$	891	$	162,519	$	(247	)	$	(1,590	)	$	160,682
Segment Profit: Net Income (Loss)	$	129,326	$	68,446	$	40,377	$	46,935	$	1,509	$	286,593	$	(342	)	$	(2,769	)	$	283,482
Expenditures for Additions to Long-Lived Assets	$	253,057	$	95,336	$	32,645	$	80,867	$	36	$	461,941	$	39		$	137		$	462,117
	At September 30, 2017
	(Thousands)
Segment Assets	$	1,407,152	$	1,929,788	$	580,051	$	2,013,123	$	60,937	$	5,991,051	$	76,861		$	35,408		$	6,103,320



	Year Ended September 30, 2016
	Exploration and Production			Pipeline and Storage		Gathering		Utility		Energy Marketing		Total Reportable Segments			All Other		Corporate and Intersegment Elimination			Total Consolidated
	(Thousands)
Revenue from External Customers(1)	$	607,113		$	215,674	$	374	$	531,024	$	93,578	$	1,447,763		$	3,753	$	900		$	1,452,416
Intersegment Revenues	$	—		$	90,755	$	89,073	$	13,123	$	884	$	193,835		$	—	$	(193,835	)	$	—
Interest Income	$	858		$	770	$	297	$	1,737	$	422	$	4,084		$	117	$	34		$	4,235
Interest Expense	$	55,434		$	33,327	$	8,872	$	27,582	$	49	$	125,264		$	—	$	(4,220	)	$	121,044
Depreciation, Depletion and Amortization	$	139,963		$	43,273	$	15,282	$	48,618	$	278	$	247,414		$	1,260	$	743		$	249,417
Income Tax Expense (Benefit)	$	(334,029	)	$	50,241	$	24,334	$	25,602	$	2,460	$	(231,392	)	$	561	$	(1,718	)	$	(232,549	)
Significant Non-Cash Item: Impairment of Oil and Gas Producing Properties	$	948,307		$	—	$	—	$	—	$	—	$	948,307		$	—	$	—		$	948,307
Segment Profit: Net Income (Loss)	$	(452,842	)	$	76,610	$	30,499	$	50,960	$	4,348	$	(290,425	)	$	778	$	(1,311	)	$	(290,958	)
Expenditures for Additions to Long-Lived Assets	$	256,104		$	114,250	$	54,293	$	98,007	$	34	$	522,688		$	37	$	326		$	523,051
	At September 30, 2016
	(Thousands)
Segment Assets	$	1,323,081		$	1,680,734	$	534,259	$	2,021,514	$	63,392	$	5,622,980		$	77,138	$	(63,731	)	$	5,636,387



	Year Ended September 30, 2015
	Exploration and Production			Pipeline and Storage		Gathering		Utility		Energy Marketing		Total Reportable Segments			All Other			Corporate and Intersegment Eliminations			Total Consolidated
	(Thousands)
Revenue from External Customers(1)	$	693,441		$	203,089	$	497	$	700,761	$	159,857	$	1,757,645		$	2,352		$	916		$	1,760,913
Intersegment Revenues	$	—		$	88,251	$	76,709	$	15,506	$	849	$	181,315		$	—		$	(181,315	)	$	—
Interest Income	$	2,554		$	474	$	140	$	2,220	$	195	$	5,583		$	66		$	(1,727	)	$	3,922
Interest Expense	$	46,726		$	27,658	$	1,627	$	28,176	$	27	$	104,214		$	—		$	(4,743	)	$	99,471
Depreciation, Depletion and Amortization	$	239,818		$	38,178	$	10,829	$	45,616	$	209	$	334,650		$	832		$	676		$	336,158
Income Tax Expense (Benefit)	$	(428,217	)	$	48,113	$	24,721	$	33,143	$	4,547	$	(317,693	)	$	13		$	(1,456	)	$	(319,136	)
Significant Non-Cash Item: Impairment of Oil and Gas Producing Properties	$	1,126,257		$	—	$	—	$	—	$	—	$	1,126,257		$	—		$	—		$	1,126,257
Segment Profit: Net Income (Loss)	$	(556,974	)	$	80,354	$	31,849	$	63,271	$	7,766	$	(373,734	)	$	(2	)	$	(5,691	)	$	(379,427	)
Expenditures for Additions to Long-Lived Assets	$	557,313		$	230,192	$	118,166	$	94,371	$	128	$	1,000,170		$	—		$	339		$	1,000,509
	At September 30, 2015
	(Thousands)
Segment Assets	$	2,439,801		$	1,590,524	$	444,358	$	1,934,731	$	90,676	$	6,500,090		$	77,350		$	(12,501	)	$	6,564,939


(1)	All Revenue from External Customers originated in the United States.



Geographic Information	At September 30
	2017		2016		2015
	(Thousands)
Long-Lived Assets:
United States	$	5,285,040	$	5,223,356	$	6,189,138