NYSE: TRGP

December 31, 2025 242,770,213 214,662,156

December 31, 2024 241,764,105 217,763,821

Additional paid-in capital

3,088.1

3,089.1

Retained earnings (deficit)

2,294.4

1,190.0

Accumulated other comprehensive income (loss)

113.8

27.5

Treasury stock, at cost (28,108,057 shares and 24,000,284 shares as of December 31, 2025 and 2024)

(2,428.6

)

(1,714.4

)

Total Targa Resources Corp. stockholders’ equity

3,067.9

2,592.4

Noncontrolling interests

130.3

1,825.8

Total owners’ equity

3,198.2

4,418.2

Total liabilities and owners’ equity

$

25,218.4

$

22,734.1

See notes to consolidated financial statements.

F-5

TARGA RESOURCES CORP.

CONSOLIDATED STATEMENTS OF OPERATIONS

Year Ended December 31,

2025

2024

2023

(In millions, except per share amounts)

Revenues:

Sales of commodities

$

14,403.5

$

13,891.8

$

13,962.1

Fees from midstream services

2,624.8

2,489.7

2,098.2

Total revenues

17,028.3

16,381.5

16,060.3

Costs and expenses:

Product purchases and fuel

10,507.8

10,703.0

10,676.4

Operating expenses

1,298.3

1,175.6

1,077.9

Depreciation and amortization expense

1,515.3

1,423.0

1,329.6

General and administrative expense

406.0

384.9

348.7

Other operating (income) expense

(30.3

)

(0.4

)

1.5

Income (loss) from operations

3,331.2

2,695.4

2,626.2

Other income (expense):

Interest expense, net

(852.8

)

(767.2

)

(687.8

)

Equity earnings (loss)

11.8

9.4

9.0

Other, net

(3.8

)

0.4

(4.9

)

Income (loss) before income taxes

2,486.4

1,938.0

1,942.5

Income tax (expense) benefit

(529.7

)

(384.5

)

(363.2

)

Net income (loss)

1,956.7

1,553.5

1,579.3

Less: Net income (loss) attributable to noncontrolling interests

33.7

241.5

233.4

Net income (loss) attributable to Targa Resources Corp.

1,923.0

1,312.0

1,345.9

Premium on repurchase of noncontrolling interests, net of tax

70.5

32.9

510.1

Net income (loss) attributable to common shareholders

$

1,852.5

$

1,279.1

$

835.8

Net income (loss) per common share - basic

$

8.52

$

5.77

$

3.69

Net income (loss) per common share - diluted

$

8.49

$

5.74

$

3.66

Weighted average shares outstanding - basic

216.1

220.2

224.6

Weighted average shares outstanding - diluted

216.9

221.3

226.0

See notes to consolidated financial statements.

F-6

TARGA RESOURCES CORP.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

Year Ended December 31,

2025

2024

2023

Pre-Tax

Related Income Tax

After Tax

Pre-Tax

Related Income Tax

After Tax

Pre-Tax

Related Income Tax

After Tax

(In millions)

Net income (loss)

$

1,956.7

$

1,553.5

$

1,579.3

Other comprehensive income (loss):

Commodity hedging contracts:

Change in fair value

$

202.8

$

(46.4

)

156.4

$

(7.5

)

$

1.7

(5.8

)

$

193.4

$

(44.3

)

149.1

Settlements reclassified to revenues

(90.9

)

20.8

(70.1

)

(67.8

)

15.5

(52.3

)

(153.4

)

35.2

(118.2

)

Other comprehensive income (loss)

111.9

(25.6

)

86.3

(75.3

)

17.2

(58.1

)

40.0

(9.1

)

30.9

Comprehensive income (loss)

2,043.0

1,495.4

1,610.2

Less: Comprehensive income (loss) attributable to noncontrolling interests

33.7

241.5

233.4

Comprehensive income (loss) attributable to Targa Resources Corp.

$

2,009.3

$

1,253.9

$

1,376.8

See notes to consolidated financial statements.

F-7

TARGA RESOURCES CORP.

CONSOLIDATED STATEMENTS OF CASH FLOWS

Year Ended December 31,

2025

2024

2023

(In millions)

Cash flows from operating activities

Net income (loss)

$

1,956.7

$

1,553.5

$

1,579.3

Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:

Amortization in interest expense

17.3

14.8

13.2

Compensation on equity grants

69.5

63.2

62.4

Depreciation and amortization expense

1,515.3

1,423.0

1,329.6

Deferred income tax expense (benefit)

516.6

367.0

349.6

Equity (earnings) loss of unconsolidated affiliates

(11.8

)

(9.4

)

(9.0

)

Distributions of earnings received from unconsolidated affiliates

20.7

19.8

13.1

Risk management activities

5.3

164.6

(275.4

)

Other, net

21.4

14.5

9.6

Changes in operating assets and liabilities, net of acquisitions:

Receivables and other assets

110.8

(75.0

)

(20.6

)

Inventories

(89.5

)

33.5

36.0

Accounts payable, accrued liabilities and other liabilities

(256.8

)

40.7

68.2

Interest payable

41.9

39.5

55.6

Net cash provided by (used in) operating activities

3,917.4

3,649.7

3,211.6

Cash flows from investing activities

Outlays for property, plant and equipment

(3,333.3

)

(2,965.8

)

(2,385.4

)

Outlays for business acquisition, net of cash acquired

(122.8

)

—

—

Outlays for asset acquisition, net of cash acquired

(90.3

)

—

—

Investments in unconsolidated affiliates

(130.5

)

(62.9

)

(24.6

)

Return of capital from unconsolidated affiliates

7.8

5.5

5.5

Other, net

27.1

1.9

3.7

Net cash provided by (used in) investing activities

(3,642.0

)

(3,021.3

)

(2,400.8

)

Cash flows from financing activities

Debt obligations:

Repayments of credit facilities

—

—

(290.0

)

Proceeds from borrowings of commercial paper notes

109,555.6

85,430.5

59,002.8

Repayments of commercial paper notes

(110,525.1

)

(84,475.0

)

(59,836.5

)

Repayment of term loan facility

—

(500.0

)

(1,000.0

)

Proceeds from borrowings under accounts receivable securitization facility

1,470.0

775.0

143.1

Repayments of accounts receivable securitization facility

(1,800.0

)

(1,020.0

)

(368.1

)

Proceeds from issuance of senior unsecured notes

5,239.4

999.4

3,727.7

Redemption of senior unsecured notes

(705.2

)

—

—

Principal payments of finance leases

(76.5

)

(50.1

)

(42.9

)

Costs incurred in connection with financing arrangements

(57.1

)

(9.9

)

(36.1

)

Repurchases of common stock

(641.8

)

(754.7

)

(373.7

)

Shares tendered for tax withholding obligations

(67.3

)

(56.4

)

(55.8

)

Contributions from noncontrolling interests

—

12.0

9.7

Distributions to noncontrolling interests

(33.5

)

(232.6

)

(222.1

)

Repurchase of noncontrolling interests

(1,800.4

)

(112.9

)

(1,118.9

)

Dividends paid to common shareholders

(818.3

)

(615.5

)

(427.3

)

Other, net

(6.4

)

(2.6

)

—

Net cash provided by (used in) financing activities

(266.6

)

(612.8

)

(888.1

)

Net change in cash and cash equivalents

8.8

15.6

(77.3

)

Cash and cash equivalents, beginning of period

157.3

141.7

219.0

Cash and cash equivalents, end of period

$

166.1

$

157.3

$

141.7

See notes to consolidated financial statements.

F-8

TARGA RESOURCES CORP.

CONSOLIDATED STATEMENTS OF CHANGES IN OWNERS’ EQUITY

Retained

Accumulated

Additional

Earnings

Other

Treasury

Total

Common Stock

Paid in

(Accumulated

Comprehensive

Shares

Noncontrolling

Owners’

Shares

Amount

Capital

Deficit)

Income (Loss)

Shares

Amount

Interests

Equity

(In millions, except shares in thousands)

Balance, December 31, 2022

226,042

$

0.2

$

3,702.3

$

(626.8

)

$

54.7

11,897

$

(464.7

)

$

2,316.5

$

4,982.2

Compensation on equity grants

—

—

62.4

—

—

—

—

—

62.4

Dividend equivalent rights

—

—

(2.3

)

(1.6

)

—

—

—

—

(3.9

)

Shares issued under compensation program

2,156

—

—

—

—

—

—

—

—

Shares tendered for tax withholding obligations

(716

)

—

—

—

—

716

(55.8

)

—

(55.8

)

Repurchases of common stock

(4,871

)

—

—

—

—

4,871

(373.7

)

—

(373.7

)

Excise tax on repurchases of common stock

—

—

—

—

—

—

(2.7

)

—

(2.7

)

Common stock dividends

Dividends - $1.85 per share

—

—

—

(419.0

)

—

—

—

—

(419.0

)

Dividends in excess of retained earnings

—

—

(193.5

)

193.5

—

—

—

—

—

Distributions to noncontrolling interests

—

—

—

—

—

—

—

(230.0

)

(230.0

)

Contributions from noncontrolling interests

—

—

—

—

—

—

—

9.7

9.7

Repurchase of noncontrolling interests, net of tax

—

—

(510.1

)

—

—

—

—

(459.3

)

(969.4

)

Other comprehensive income (loss)

—

—

—

—

30.9

—

—

—

30.9

Net income (loss)

—

—

—

1,345.9

—

—

—

233.4

1,579.3

Balance, December 31, 2023

222,611

0.2

3,058.8

492.0

85.6

17,484

(896.9

)

1,870.3

4,610.0

Compensation on equity grants

—

—

63.2

—

—

—

—

—

63.2

Dividend equivalent rights

—

—

—

(3.8

)

—

—

—

—

(3.8

)

Shares issued under compensation program

1,669

—

—

—

—

—

—

—

—

Shares tendered for tax withholding obligations

(583

)

—

—

—

—

583

(56.4

)

—

(56.4

)

Repurchases of common stock

(5,933

)

—

—

—

—

5,933

(754.7

)

—

(754.7

)

Excise tax on repurchases of common stock

—

—

—

—

—

—

(6.4

)

—

(6.4

)

Common stock dividends

Dividends - $2.75 per share

—

—

—

(610.2

)

—

—

—

—

(610.2

)

Distributions to noncontrolling interests

—

—

—

—

—

—

—

(229.0

)

(229.0

)

Contributions from noncontrolling interests

—

—

—

—

—

—

—

12.0

12.0

Repurchase of noncontrolling interests, net of tax

—

—

(32.9

)

—

—

—

—

(69.0

)

(101.9

)

Other comprehensive income (loss)

—

—

—

—

(58.1

)

—

—

—

(58.1

)

Net income (loss)

—

—

—

1,312.0

—

—

—

241.5

1,553.5

Balance, December 31, 2024

217,764

$

0.2

$

3,089.1

$

1,190.0

$

27.5

24,000

$

(1,714.4

)

$

1,825.8

$

4,418.2

See notes to consolidated financial statements.

F-9

TARGA RESOURCES CORP.

CONSOLIDATED STATEMENTS OF CHANGES IN OWNERS’ EQUITY

Retained

Accumulated

Additional

Earnings

Other

Treasury

Total

Common Stock

Paid in

(Accumulated

Comprehensive

Shares

Noncontrolling

Owners’

Shares

Amount

Capital

Deficit)

Income (Loss)

Shares

Amount

Interests

Equity

(In millions, except shares in thousands)

Balance, December 31, 2024

217,764

$

0.2

$

3,089.1

$

1,190.0

$

27.5

24,000

$

(1,714.4

)

$

1,825.8

$

4,418.2

Compensation on equity grants

—

—

69.5

—

—

—

—

—

69.5

Dividend equivalent rights

—

—

—

(3.5

)

—

—

—

—

(3.5

)

Shares issued under compensation program

1,006

—

—

—

—

—

—

—

—

Shares tendered for tax withholding obligations

(343

)

—

—

—

—

343

(67.3

)

—

(67.3

)

Repurchases of common stock

(3,765

)

—

—

—

—

3,765

(641.8

)

—

(641.8

)

Excise tax on repurchases of common stock

—

—

—

—

—

—

(5.1

)

—

(5.1

)

Common stock dividends

Dividends - $3.75 per share

—

—

—

(815.1

)

—

—

—

—

(815.1

)

Distributions to noncontrolling interests

—

—

—

—

—

—

—

(20.0

)

(20.0

)

Repurchase of noncontrolling interests, net of tax

—

—

(70.5

)

—

—

—

—

(1,709.2

)

(1,779.7

)

Other comprehensive income (loss)

—

—

—

—

86.3

—

—

—

86.3

Net income (loss)

—

—

—

1,923.0

—

—

—

33.7

1,956.7

Balance, December 31, 2025

214,662

$

0.2

$

3,088.1

$

2,294.4

$

113.8

28,108

$

(2,428.6

)

$

130.3

$

3,198.2

See notes to consolidated financial statements.

F-10

TARGA RESOURCES CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Except as noted within the context of each footnote disclosure, the dollar amounts presented in the tabular data within these footnote disclosures are stated in millions of dollars.

Note 1 — Organization and Operations

Our Organization

Targa Resources Corp. (NYSE: TRGP) owns, operates, acquires, and develops a diversified portfolio of complementary domestic infrastructure assets.

In this Annual Report, unless the context requires otherwise, references to “we,” “us,” “our,” “the Company,” “Targa” or “TRGP” are intended to mean our consolidated business and operations. TRGP controls the general partner of and owns all of the outstanding common units representing limited partner interests in Targa Resources Partners LP, referred to herein as the “Partnership”. Targa consolidates the Partnership and its subsidiaries under accounting principles generally accepted in the United States of America (“GAAP”), and the accompanying consolidated financial statements have been prepared under the rules and regulations of the SEC. Targa’s consolidated financial statements include differences from the consolidated financial statements of the Partnership. The most noteworthy differences are:

•
the inclusion of the TRGP senior revolving credit facility;

•
the inclusion of the TRGP senior unsecured notes;

•
the inclusion of the TRGP commercial paper notes; and

•
the impacts of TRGP’s treatment as a corporation for U.S. federal income tax purposes.

Our Operations

The Company is primarily engaged in the business of:

•
gathering, compressing, treating, processing, transporting, and purchasing and selling natural gas;

•
transporting, storing, fractionating, treating, and purchasing and selling NGLs and NGL products, including services to LPG exporters; and

•
gathering, storing, terminaling, and purchasing and selling crude oil.

See “Note 22 – Segment Information” for certain financial information regarding our business segments.

Note 2 — Basis of Presentation

These accompanying financial statements and related notes present our consolidated financial position as of December 31, 2025 and 2024, and the results of operations, comprehensive income (loss), cash flows, and changes in owners’ equity for the years ended December 31, 2025, 2024 and 2023. We have prepared these consolidated financial statements in accordance with GAAP. All significant intercompany balances and transactions have been eliminated in consolidation. Certain amounts in prior periods have been reclassified to conform to the current year presentation.

Note 3 — Significant Accounting Policies

Consolidation Policy

Our consolidated financial statements include the accounts of all entities that we control and our proportionate interest in the accounts of certain gas gathering and processing facilities in which we own an undivided interest and are responsible for our proportionate share of the costs and expenses of the facilities. Third party ownership interests in our controlled subsidiaries are presented as noncontrolling interests within the equity section of our Consolidated Balance Sheets, except in the case of undivided interest ownership. In our Consolidated Statements of Operations and Consolidated Statements of Comprehensive Income (Loss), noncontrolling interests reflect the attribution of results to third-party investors. All intercompany balances and transactions have been eliminated in consolidation.

F-11

As of December 31, 2025, our consolidated joint ventures include the following:

Gathering and Processing Segment

•
60% ownership interest in Centrahoma Processing LLC;

•
72.8% undivided interest in the assets of Targa Pipeline Mid-Continent WestTex LLC; and

•
76.8% ownership interest in Venice Energy Services Company, LLC.

Logistics and Transportation Segment

•
80% ownership interest in Targa Train 7 LLC.

We apply the equity method of accounting to investments over which we exercise significant influence over the operating and financial policies of our investee, but do not exercise control. We evaluate our equity investments for impairment when evidence indicates the carrying amount of our investment is no longer recoverable. Evidence of a loss in value might include, but would not necessarily be limited to, absence of an ability to recover the carrying amount of the investment or inability of the equity method investee to sustain an earnings capacity that would justify the carrying amount of the investment. When the estimated fair value of an equity investment is less than its carrying value and the loss in value is determined to be other than temporary, we recognize the excess of the carrying value over the estimated fair value as a non-cash pre-tax impairment loss within Equity earnings (loss) in our Consolidated Statements of Operations.

As of December 31, 2025, our investments in unconsolidated affiliates include the following:

Gathering and Processing Segment

•
50% ownership interest in Little Missouri 4 LLC (“Little Missouri 4”).

Logistics and Transportation Segment

•
50% ownership interest in Cayenne Pipeline, LLC (“Cayenne”);

•
38.8% ownership interest in Gulf Coast Fractionators (“GCF”); and

•
17.5% non-operated ownership interest in Blackcomb and Traverse pipelines, which are currently under construction, held by Blackcomb as defined in “Note 4 – Acquisitions and Joint Ventures”.

Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in these financial statements and accompanying notes. Estimates and judgments are based on information available at the time such estimates and judgments are made. Changes in facts and circumstances may result in revised estimates and actual results could differ materially from those estimates. Estimates and judgments are used in, among other things, (i) estimating unbilled revenues, product purchases, property, plant and equipment, operating and general and administrative cost accruals, (ii) developing fair value assumptions, including estimates of future cash flows and discount rates, (iii) analyzing long-lived assets for possible impairment, (iv) estimating the useful lives of assets and (v) estimating contingencies, guarantees and indemnifications.

Cash and Cash Equivalents

Cash and cash equivalents include all cash on hand, demand deposits, and short-term, highly liquid investments that are readily convertible into cash, and have original maturities of three months or less.

Allowance for Credit Losses

Estimated losses on accounts receivable are provided through an allowance for credit losses. We estimate the allowance for credit losses through various procedures, including extensive review of our trade receivable balances by counterparty, assessing economic events and conditions, our historical experience with counterparties, the counterparty’s financial condition and the amount and age of past due accounts.

We continuously evaluate our ability to collect amounts owed to us. Receivables are considered past due if full payment is not received by the contractual due date. Our evaluation procedures also include performing account reconciliations, dispute resolution and payment confirmation.

F-12

As the financial condition of any counterparty changes, circumstances develop or additional information becomes available, adjustments to our allowance may be required.

Inventories

Our inventories consist primarily of NGL product inventories, which are valued at the lower of cost or net realizable value, using the average cost method. Most NGL product inventories turn over monthly, but some inventory, primarily propane, is acquired and held during the year to meet anticipated heating season requirements of our customers. Commodity inventories that are not physically or contractually available for sale under normal operations (“deadstock”) are included in Property, plant and equipment.

Product Exchanges

Exchanges of NGL products are executed to satisfy timing and logistical needs of the exchange parties. Volumes received and delivered under exchange agreements are recorded as inventory. If the locations of receipt and delivery are in different markets, an exchange differential may be billed or owed. The exchange differential is recorded as either accounts receivable or accrued liabilities.

Derivative Instruments

We utilize derivative instruments to manage the volatility of our cash flows due to fluctuating energy commodity prices. For balance sheet classification purposes, we analyze the fair values of the derivative instruments on a contract by contract basis and report the related fair values and any related collateral by counterparty on a gross basis. Cash flows from derivative instruments designated as hedges are recognized in the same financial statement line item as the cash flows from the respective item being hedged.

We formally document all relationships between hedging instruments and hedged items, as well as its risk management objectives and strategy for undertaking the hedge. This documentation includes the specific identification of the hedging instrument and the hedged item, the nature of the risk being hedged and the manner in which the hedging instrument’s effectiveness will be assessed. At the inception of the cash flow hedging relationship and on an ongoing basis, we assess whether the derivatives used in hedging transactions are highly effective in achieving the offset of changes in cash flows attributable to the hedged risk.

We record all derivative instruments at fair value with the exception of those that we apply the normal purchases and normal sales election.

The table below summarizes the accounting treatment for our derivative instruments, and the impact on our consolidated financial statements:

Recognition and Measurement

Derivative Treatment

Balance Sheet

Income Statement

Normal Purchases and Normal Sales

Fair value not recorded

Earnings recognized when volumes are physically delivered or received

Mark-to-Market

Recorded at fair value

Change in fair value recognized currently in earnings

Cash Flow Hedge

Recorded at fair value with changes in fair value deferred in Accumulated Other Comprehensive Income (“AOCI”)

The gain/loss on the derivative instrument is reclassified out of AOCI into earnings when the forecasted transaction occurs

We will discontinue cash flow hedge accounting on a prospective basis when a hedge instrument is terminated, ceases to be highly effective or the forecasted transaction is no longer probable to occur. Gains and losses deferred in AOCI related to cash flow hedges for which hedge accounting has been discontinued remain deferred until the forecasted transaction occurs. If it is probable that a hedged forecasted transaction will not occur, deferred gains or losses on the hedging instrument in AOCI are reclassified to earnings immediately.

F-13

Fair Value Measurements

We categorize the inputs to the fair value measurements of financial assets and liabilities at each balance sheet reporting date using a three-tier fair value hierarchy that prioritizes the significant inputs used in measuring fair value:

•
Level 1 – observable inputs such as quoted prices in active markets;

•
Level 2 – inputs other than quoted prices in active markets that we can directly or indirectly observe to the extent that the markets are liquid for the relevant settlement periods; and

•
Level 3 – unobservable inputs in which little or no market data exists, therefore we must develop our own assumptions.

For valuations that include both observable and unobservable inputs, if the unobservable input is determined to be significant to the overall inputs, the entire valuation is categorized in Level 3. This includes derivatives valued using indicative price quotations whose contract length extends into unobservable periods.

Swaps that do not have observable market prices or implied volatilities for substantially the full term of the derivative asset or liability are reported at fair value using Level 3 inputs. The fair value of these swaps is determined using a discounted cash flow valuation technique based on a commodity forward curve, which is based on observable or public data sources and extrapolated when observable prices are not available.

Property, Plant and Equipment

Property, plant and equipment is recorded at acquisition cost less accumulated depreciation. Depreciation is computed using the straight-line method over the estimated useful lives of the assets. The determination of the useful lives of property, plant and equipment requires us to make various assumptions, including our expected use of the asset and the supply of, and demand for, hydrocarbons in the markets served, normal wear and tear of the facilities, and the extent and frequency of maintenance programs. Upon disposition or retirement of property, plant and equipment, any gain or loss is recorded to Other operating (income) expense in the Consolidated Statements of Operations.

Expenditures for routine maintenance and repairs are expensed as incurred. Expenditures to refurbish an asset that increases its existing service potential or prevents environmental contamination are capitalized and depreciated over the remaining useful life of the asset or major asset component. Certain costs directly related to the construction of assets, including internal labor costs, interest and engineering costs, are capitalized.

Impairment of Long-Lived Assets

We evaluate long-lived assets, including intangible assets, for impairment when events or changes in circumstances indicate our carrying amount of an asset may not be recoverable, including changes to our estimates that could have an impact on our assessment of asset recoverability. Asset recoverability is measured by comparing the carrying value of the asset or asset group with its expected future pre-tax undiscounted cash flows. Individual assets are grouped at the lowest level for which the related identifiable cash flows are largely independent of the cash flows of other assets and liabilities. These cash flow estimates require us to make judgments and assumptions related to operating and cash flow results, economic obsolescence, the business climate, contractual, legal and other factors.

If the carrying amount exceeds the expected future undiscounted cash flows, we recognize a non-cash pre-tax impairment loss equal to the excess of net book value over fair value. The estimated cash flows used to assess recoverability of our long-lived assets and measure fair value of our asset groups are derived from current business plans, which are developed using near-term price and volume projections reflective of the current environment and management's projections for long-term average prices and volumes. In addition to near and long-term price assumptions, other key assumptions include volume projections, operating costs, timing of incurring such costs, and the use of an appropriate terminal value and discount rate. Any changes we make to these projections and assumptions could result in significant revisions to our evaluation of recoverability of our long-lived assets and the recognition of additional impairments. We believe our estimates and models used to determine fair value are similar to what a market participant would use.

F-14

Goodwill

Goodwill is a residual intangible asset that results when the cost of an acquisition exceeds the fair value of the net identifiable assets of the acquired business. Goodwill is not subject to amortization but is tested for impairment at least annually. This test requires us to attribute goodwill to an appropriate reporting unit, which is an operating segment or one level below an operating segment (also known as a component). We evaluate goodwill for impairment on November 30 of each year, or whenever impairment indicators are present. If applicable, prior to us conducting the goodwill impairment test, we complete a review of the carrying values of our long-lived assets, including property, plant and equipment and other intangible assets. If it is determined that the carrying values are not recoverable, we reduce the carrying values of the long-lived assets pursuant to our policy on impairment of long-lived assets.

As part of our goodwill impairment test, we may first assess qualitative factors to determine if the quantitative goodwill impairment test is necessary. If we choose to bypass this qualitative assessment or determine that a goodwill impairment test is required, our annual goodwill impairment test is performed by comparing the fair value of a reporting unit with its carrying amount (including attributed goodwill). We recognize an impairment loss in our Consolidated Statements of Operations and a corresponding reduction of goodwill on our Consolidated Balance Sheets for the amount by which the carrying amount exceeds the reporting unit’s fair value. The goodwill impairment loss will not exceed the total amount of goodwill allocated to that reporting unit. Additionally, when measuring goodwill, we consider income tax effects from any tax-deductible goodwill on the carrying amount of the reporting unit, if applicable.

Intangible Assets

Our intangible assets include producer dedications under long-term contracts and customer relationships associated with business and asset acquisitions. The fair value of these acquired intangible assets were determined at the date of acquisition based on the present values of estimated future cash flows. We amortize the costs of our assets in a manner that closely resembles the expected benefit pattern of the intangible assets or on a straight-line basis, where such pattern is not readily determinable, over the periods in which we benefit from services provided to customers.

Asset Retirement Obligations

Asset retirement obligations (“AROs”) are legal obligations associated with the retirement of tangible long-lived assets that result from their acquisition, construction, development and/or normal operation. We record a liability and increase the basis in the underlying asset for the present value of each expected ARO when there is a legal obligation to settle under existing or enacted law, statute, written or oral contract or by legal construction.

For certain assets, we cannot reasonably estimate the fair value of the ARO because the associated assets have indeterminate lives based on our expected continued use of the assets with proper maintenance. Assets with indeterminate useful lives include: (i) assets constructed on land owned by Targa, and (ii) active pipelines. Our intent and practice is to maintain our assets to prolong their useful lives. Management expects demand for hydrocarbons, both domestically and internationally, to exist for the foreseeable future. We record AROs for these assets in the period in which sufficient information becomes available for us to reasonably estimate the settlement dates.

Our obligations are estimated based on discounted cash flow (“DCF”) estimates. Over time, the ARO liability is accreted to its present value as a period cost and the capitalized amount is depreciated over the asset’s respective useful life. At least annually, we review the projected timing and amount of AROs and reflect revisions as an increase or decrease in the carrying amount of the liability and the basis in the underlying asset. Upon settlement, we recognize any difference between the recorded amount and the actual settlement cost as a gain or loss.

Debt Issuance Costs

Costs incurred in connection with the issuance of long-term debt and any original issue discount or premium are deferred and charged to interest expense over the term of the related debt. Debt issuance costs related to revolving credit facilities are amortized on a straight-line basis and those related to long-term debt are amortized using the effective-interest method. Debt issuance costs related to revolving credit facilities are presented as other long-term assets, and debt issuance costs related to long-term debt obligations with scheduled maturities are reflected as a deduction to the carrying amount of long-term debt on the Consolidated Balance Sheets. Gains or losses on debt repurchases, redemptions and debt extinguishments include the write-off of any associated unamortized debt issuance costs.

F-15

Accounts Receivable Securitization Facility

Proceeds from the sale or contribution of certain receivables under the Partnership’s accounts receivable securitization facility (the “Securitization Facility”) are treated as collateralized borrowings in our financial statements. Proceeds and repayments under the Securitization Facility are reflected as cash flows from financing activities in our Consolidated Statements of Cash Flows.

Commercial Paper Program

Under the terms of the unsecured commercial paper note program (the “Commercial Paper Program”), we may issue, from time to time, unsecured commercial paper notes with varying maturities of less than one year. Amounts available under the Commercial Paper Program may be issued, repaid, and re-issued from time to time, with the maximum aggregate face or principal amount outstanding at any one time not to exceed $3.5 billion, subject to documentation requirements of the Commercial Paper Program. We maintain a minimum available borrowing capacity under the $3.5 billion TRGP senior revolving credit facility (the “TRGP Revolver” as defined in “Note 8 – Debt Obligations”) equal to the aggregate amount outstanding under the Commercial Paper Program to support our issued commercial paper notes. The Commercial Paper Program is guaranteed by each subsidiary that guarantees the TRGP Revolver.

The outstanding borrowings of the commercial paper program are classified as noncurrent because we have the intent and ability to refinance the borrowings on a long-term basis through the TRGP Revolver. We confirm, on a quarterly basis, that there is sufficient liquidity under the TRGP Revolver to refinance outstanding borrowings of the Commercial Paper Program and such liquidity is not overcommitted for other anticipated uses.

As the outstanding borrowings of the Commercial Paper Program are included as part of long-term debt (i.e., classified as noncurrent), we report Commercial Paper Program borrowings and repayments gross on the Consolidated Statements of Cash Flows (consistent with the presentation of cash flows associated with the revolving credit facility).

Environmental Liabilities and Other Loss Contingencies

We accrue a liability for loss contingencies, including environmental remediation costs arising from claims, assessments, litigation, fines, penalties and other sources, when the loss is probable and reasonably estimable.

Income Taxes

We file many income tax returns with the U.S. Department of the Treasury, as well as numerous states. We are required to estimate our income taxes in each of the jurisdictions in which we operate. This process involves estimating our actual current tax payable and related tax expense, together with assessing temporary differences resulting from differing treatment of certain items, such as depreciation, for tax and accounting purposes. These differences can result in deferred tax assets and liabilities, which are reported on a net basis by jurisdiction within our Consolidated Balance Sheets. We report these timing differences based on statutory tax rates applicable to the scheduled timing difference reversal periods.

We assess the likelihood that we will recover our deferred tax assets from future taxable income. We establish a valuation allowance if we believe that it is more likely than not (a likelihood of more than 50 percent) that some portion or all of the deferred tax assets will not be realized. Any change in the valuation allowance would impact our income tax provision and net income in the period in which such a determination is made. We consider all available evidence to determine whether, based on the weight of the evidence, we need a valuation allowance. Evidence used includes information about our current financial position and our results of operations for the current and preceding years, as well as all currently available information about future years, including our anticipated future performance, the reversal of deferred tax liabilities and tax planning strategies.

Dividends

Common dividends declared are recorded as a reduction of retained earnings to the extent that retained earnings were available at the close of the prior quarter, with any excess recorded as a reduction of additional paid-in capital.

Comprehensive Income

Comprehensive income includes net income and other comprehensive income (loss) (“OCI”), which includes changes in the fair value of derivative instruments that are designated as cash flow hedges.

F-16

Revenue Recognition

Our operating revenues are primarily derived from the following activities:

•
sales of natural gas, NGLs, condensate and crude oil;

•
services related to compressing, gathering, treating, and processing of natural gas; and

•
services related to NGL fractionation, terminaling and storage, transportation and treating.

We have multiple types of contracts with commercial counterparties, and many of these contracts contain embedded fees with settlement provisions that deduct these fees from the sales price paid by Targa in exchange for commodities. The commercial relationship of the counterparty in such contracts is inherently one of a supplier, rather than a customer, and therefore, such contracts are excluded from the provisions of the revenue recognition guidance in Topic 606, Revenue from Contracts with Customers. Any cash inflows or fees that are realized on these supply type contracts are reported as a reduction of Product purchases and fuel.

Our revenues, therefore, are measured based on consideration specified in a contract with parties designated as customers. We recognize revenue when we satisfy a performance obligation by transferring control over a commodity or service to a customer. Sales and other taxes we collect, that are both imposed on and concurrent with revenue-producing activities, are excluded from revenues.

We generally report sales revenues on a gross basis in our Consolidated Statements of Operations, as we typically act as the principal in the transactions where we receive and control commodities. However, buy-sell transactions that involve purchases and sales of inventory with the same counterparty, which are legally contingent or in contemplation of one another, as well as other instances where we do not control the commodities, but rather are acting as an agent to the supplier, are reported as a single revenue transaction on a combined net basis.

Our commodity sales contracts typically contain multiple performance obligations, whereby each distinct unit of commodity to be transferred to the customer is a separate performance obligation. Under such contracts, revenue is recognized at the point in time each unit is transferred to the customer because the customer is able to direct the use of, and obtain substantially all of the remaining benefits from, the commodity at that time. In certain instances, it may be determinable that the customer receives and consumes the benefits of each unit as it is transferred. Under such contracts, we have a single performance obligation comprised of a series of distinct units of commodity; and in such instance, revenue is recognized over time using the units delivered output method, as each distinct unit is transferred to the customer. Our commodity sales contracts are typically priced at a market index, but may also be set at a fixed price. When our sales are priced at a market index, we apply the allocation exception for variable consideration and allocate the market price to each distinct unit when it is transferred to the customer. The fixed price in our commodity sales contracts generally represents the standalone selling price, and therefore, when each distinct unit is transferred to the customer, we recognize revenue at the fixed price.

Our service contracts typically contain a single performance obligation. The underlying activities performed by us are considered inputs to an integrated service and not separable because such activities in combination are required to successfully transfer the single overall service that the customer has contracted for and expects to receive. Therefore, the underlying activities in such contracts are not considered to be distinct services. However, in certain instances, the customer may contract for additional distinct services and therefore additional performance obligations may exist. In such instances, the transaction price is allocated to the multiple performance obligations based on their relative standalone selling prices. The performance obligation(s) in our service contracts is a series of distinct days of the applicable service over the life of the contract (fundamentally a stand-ready service), whereby we recognize revenue over time using an output method of progress based on the passage of time (i.e., each day of service). This output method is appropriate because it directly relates to the value of service transferred to the customer to date, relative to the remaining days of service promised under the contract.

F-17

The transaction price for our service contracts is typically comprised of variable consideration, which is primarily dependent on the volume and composition of the commodities delivered and serviced. The variable consideration is generally commensurate with our efforts to perform the service and the terms of the variable payments relate specifically to our efforts to satisfy each day of distinct service. Therefore, the variable consideration is typically not estimated at contract inception, but rather the allocation exception for variable consideration is applied, whereby the variable consideration is allocated to each day of service and recognized as revenue when each day of service is provided. When we are entitled to noncash consideration in the form of commodities, the variability related to the form of consideration (market price) and reasons other than form (volume and composition) are interrelated to the service, and therefore, we measure the noncash consideration at the point in time when the volume, mix and market price related to the commodities retained in-kind are known. This results in the recognition of revenue based on the market price of the commodity when the service is performed. In addition, if the transaction price includes a fixed component (i.e., a fixed capacity reservation fee), the fixed component is recognized ratably on a straight-line basis over the contract term, as each day of service has elapsed, which is consistent with the output method of progress selected for the performance obligation.

Our customers are typically billed on a monthly basis, or earlier, if final delivery and sale of commodities is made prior to month-end, and payment is typically due within 10 to 30 days. As a practical matter, we define the unit of account for revenue recognition purposes based on the passage of time ranging from one month to one quarter, rather than each day. This is because the financial reporting outcome is the same regardless of whether each day or month/quarter is treated as the distinct service in the series. That is, at the end of each month or quarter, the variability associated with the amount of consideration for which we are entitled to, is resolved, and can be included in that month or quarter’s revenue.

We have certain long-term contractual arrangements under which we have received consideration, but for which all conditions for revenue recognition have not been met. These arrangements result in deferred revenue, which will be recognized over the periods that performance will be provided.

We also have certain contracts that contain provisions in which customers provide contributions in aid of construction in exchange for Targa constructing assets to fulfill the services in the contract. In general, these arrangements result in deferred revenue, which will be recognized over the contract term.

We classify our contract assets as receivables because we generally have an unconditional right to payment for the commodities sold or services performed at the end of the reporting period.

We enter into various contractual arrangements that result in the transfer of assets for no upfront compensation or cash payments, resulting in more favorable long-term contractual terms. The fair value of the assets transferred is reflected as long-term contract assets. These deferred amounts are amortized over the term of the related contract into the appropriate revenue or cost of sales accounts.

Share-Based Compensation

We award share-based compensation to employees and non-employee directors in the form of restricted stock, restricted stock units and performance share units. Compensation expense on our equity-classified awards is recorded at grant-date fair value. Compensation expense is recognized in general and administrative expense over the requisite service period of each award, and forfeitures are recognized as they occur. We may purchase a portion of the shares issued to satisfy employees’ tax withholding obligations on vested awards. These shares are recorded in treasury stock, at cost, and cash paid is classified as a financing activity in our Consolidated Statements of Cash Flows. All excess tax benefits and tax deficiencies related to share-based compensation are recognized as income tax benefit or expense in our Consolidated Statements of Operations, with the tax effects of exercised or vested awards treated as discrete items in the reporting period which they occur. Excess tax benefits are classified as an operating activity in our Consolidated Statements of Cash Flows.

Earnings per Share

We calculate basic earnings (loss) per common share (“EPS”) using the two-class method, which is an earnings allocation formula that determines net income (loss) per share for each class of common stock and participating security according to dividends declared and participation rights in undistributed earnings. Our participating securities consist of unvested restricted stock units that vest no later than three years following grant date as well as certain four-year retention awards that participate in nonforfeitable dividends with the common equity owners.

F-18

EPS is net income (loss) attributable to common shareholders less earnings allocated to participating securities divided by the sum of the weighted-average number of common shares outstanding. Earnings are allocated to common stock and participating securities based on the amount of dividends paid in the current period plus an allocation of the undistributed earnings to the extent that each security participates in earnings. Diluted EPS includes any dilutive effect of unvested restricted stock, restricted stock units and performance share units. The dilutive effect is calculated through the application of the two-class method. During a period of net loss or negative undistributed earnings, the two-class method is not applicable.

Leases

We recognize the following for all leases (with the exception of short-term leases) at the commencement date:

•
A lease liability, which is a lessee’s obligation to make lease payments arising from a lease.

•
A right-of-use asset, which is an asset that represents the lessee’s right to use, or control the use of, a specified asset for the lease term.

We determine if an arrangement is or contains a lease at inception. Leases with an initial term of twelve months or less are considered short-term leases, which are excluded from the balance sheet. Right-of-use assets and lease liabilities are recognized at the commencement date based on the present value of future lease payments over the lease term. The right-of-use asset also includes any lease prepayments and excludes lease incentives. We made an accounting policy election to combine lease and non-lease components for both arrangements in which Targa is the lessee or lessor. As most of the Company’s leases do not provide an implicit interest rate, we use our incremental borrowing rate as the discount rate to compute the present value of our lease liability. The discount rate applied is determined based on information available on the date of adoption for all leases existing as of that date, and on the date of lease commencement for all subsequent leases.

Our lease arrangements may include variable lease payments based on an index or market rate, or may be based on performance. For variable lease payments based on an index or market rate, we estimate and apply a rate based on information available at the commencement date. Variable lease payments based on performance are excluded from the calculation of the right-of-use asset and lease liability, and are recognized in our Consolidated Statements of Operations when the contingency underlying such variable lease payments is resolved. Our lease terms may include options to extend or terminate the lease. Such options are included in the measurement of our right-of-use asset and liability at commencement, provided we determine that we are reasonably certain to exercise the option.

45Q Tax Credits

We earn tax credits under Internal Revenue Code Section 45Q through our carbon capture and sequestration activities. We recognize 45Q tax credits by analogy to the grant model within International Accounting Standard 20, Accounting for Government Grants and Disclosure Assistance, as other operating income in our Consolidated Statements of Operations based on the volume of captured carbon sequestered and dollar value of the tax credit during the period in which captured carbon is sequestered underground. We recognize realized 45Q tax credits as a reduction to income taxes payable to the extent that we can use the tax credits to reduce Targa’s quarterly estimated cash tax payments. We recognize realized 45Q tax credits in excess of Targa’s quarterly estimated tax liability as long-term assets until they are monetized or are otherwise realized.

Recent Accounting Pronouncements

Recently Adopted Accounting Pronouncements

Improvements to Income Tax Disclosures

In December 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. The amendments in this Update require, among other items, that public entities disclose, on an annual basis, (i) specific categories of income taxes in the rate reconciliation, and (ii) a disaggregation of income taxes paid by federal, state, and foreign taxes.

The amendments are required to be applied prospectively with retrospective application permitted. We adopted this ASU on January 1, 2025, and applied the amendments to all prior periods presented in our consolidated financial statements. See “Note 19 – Income Taxes”.

F-19

Recently issued accounting pronouncements not yet adopted

Disaggregation of Income Statement Expenses

In November 2024, the FASB issued ASU 2024-03, Comprehensive income (Topic 220): Disaggregation of Income Statement Expenses. The amendments in this Update require, among other items, that public entities disclose, on an annual and interim basis, in tabular format in the footnotes to the financial statements, disaggregated information about specific categories underlying certain income statement expense line items that contain any of the following expense categories (i) purchases of inventory, (ii) employee compensation, (iii) depreciation, (iv) intangible asset amortization, and (v) depletion. Additionally, the amendments require disclosure of the total amount of selling expenses and an annual disclosure of the definition of selling expenses.

These amendments are effective for fiscal years beginning after December 15, 2026, and for interim periods within fiscal years beginning after December 15, 2027, with early adoption permitted. The disclosures may be applied either prospectively or retrospectively to any or all prior periods presented in the financial statements. We are evaluating the effect of the amendments on our notes to consolidated financial statements and expect to disclose the required information for fiscal years beginning in the annual report on Form 10-K for the year ending December 31, 2027 and for interim periods beginning in the quarterly report on Form 10-Q for the quarter ending March 31, 2028. The impact of the adoption will be limited to disclosure in the notes to consolidated financial statements.

Targeted Improvements to the Accounting for Internal-Use Software

In September 2025, the FASB issued ASU 2025-06, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software. The amendments in this Update, among other items, remove all references to prescriptive and sequential software development stages and require entities to start capitalizing software costs when (i) management has authorized and committed to funding the software project, and (ii) it is probable that the project will be completed and the software will be used to perform the function intended.

These amendments are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2027, with early adoption permitted. The amendments permit the use of prospective, modified retrospective, or full retrospective transition approaches. We are evaluating the effect of the amendments on our consolidated financial statements and related disclosures. We expect to apply the amendments for interim periods beginning in the quarterly report on Form 10-Q for the quarter ending March 31, 2028 and for fiscal years beginning in the annual report on Form 10-K for the year ending December 31, 2028.

Accounting for Government Grants Received by Business Entities

In December 2025, the FASB issued ASU 2025-10, Government Grants (Topic 832): Accounting for Government Grants Received by Business Entities. The amendments in this Update, among other items, establish guidance on the recognition, measurement and presentation of government grants received by a business entity.

These amendments are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2028, with early adoption permitted. The amendments permit the use of modified prospective, modified retrospective, or retrospective approaches. We are evaluating the effect of the amendments on our consolidated financial statements and related disclosures. We expect to apply the amendments for interim periods beginning in the quarterly report on Form 10-Q for the quarter ending March 31, 2029 and for fiscal years beginning in the annual report on Form 10-K for the year ending December 31, 2029.

Note 4 — Acquisitions and Joint Ventures

In January 2023, we completed the acquisition of Blackstone Energy Partners’ 25% interest in the Grand Prix Pipeline LLC (the “Grand Prix Transaction”) for aggregate consideration of $1.05 billion in cash and a final closing adjustment of $41.9 million. Following the closing of the Grand Prix Transaction, we own 100% of the interest in Grand Prix. The change in our ownership interests was accounted for as an equity transaction representing the acquisition of noncontrolling interests. The amount of the redemption price in excess of the carrying amount, net of tax, was $490.7 million, which was accounted for as a premium on repurchase of noncontrolling interests, and resulted in a reduction to Net income (loss) attributable to common shareholders.

In December 2023, we completed the acquisition of the remaining 50% membership interest in Carnero G&P LLC (“Carnero”) from our joint venture partner for cash consideration of $27.0 million (the “Carnero Acquisition”). The change in our ownership interests was accounted for as an equity transaction representing the acquisition of noncontrolling interests. The amount of the consideration in excess of the carrying amount, net of tax, was $20.1 million, which was accounted for as a premium on repurchase of noncontrolling interests, and resulted in a reduction to Net income (loss) attributable to common shareholders.

F-20

In July 2024, we entered into a joint venture (“Blackcomb Joint Venture”) which will construct the Blackcomb pipeline. The Blackcomb Joint Venture is owned 70.0% by WPC, 17.5% by Targa, and 12.5% by MPLX LP. WPC is a joint venture owned 50.6% by WhiteWater, 30.4% by MPLX LP, and 19.0% by Enbridge Inc. The Blackcomb pipeline is designed to transport up to 2.5 Bcf/d of natural gas through approximately 365 miles of 42-inch pipeline from the Permian Basin in West Texas to the Agua Dulce area in South Texas, pending the receipt of customary regulatory and other approvals.

In April 2025, WhiteWater announced the Blackcomb Joint Venture reached a final investment decision to construct the Traverse pipeline. The bi-directional Traverse pipeline is designed to transport up to 2.5 Bcf/d of natural gas through approximately 160 miles of pipeline between the Agua Dulce area and the Katy area, pending the receipt of customary regulatory and other approvals. Both the Blackcomb and Traverse pipelines will be operated by an affiliate of WhiteWater. For additional information see “Note 7 – Investments in Unconsolidated Affiliates”.

In December 2024, we completed the acquisition of the remaining 12% membership interest in Cedar Bayou Fractionators, L.P. (“CBF”) from our joint venture partner for cash consideration of $111.6 million (the “CBF Acquisition”). The change in our ownership interests was accounted for as an equity transaction representing the acquisition of noncontrolling interests. The amount of the consideration in excess of the carrying amount, net of tax, was $32.9 million, which was accounted for as a premium on repurchase of noncontrolling interests, and resulted in a reduction to Net income (loss) attributable to common shareholders.

In March 2025, we completed the acquisition of Blackstone’s 45% interest in Targa Badlands LLC (“Targa Badlands”) for aggregate consideration of $1.8 billion in cash, with an additional $0.4 million of capitalized transaction costs (the “Badlands Transaction”). As a result of the acquisition, we own 100% of the interests in and earnings of Targa Badlands effective January 1, 2025. The change in our ownership interest was accounted for as an equity transaction representing the acquisition of noncontrolling interests. The amount of the redemption price in excess of the carrying amount, net of tax, was $70.5 million, which was accounted for as a premium on repurchase of noncontrolling interests, and resulted in a reduction to Net income (loss) attributable to common shareholders.

In December 2025, we completed the purchase of all of the membership interests in Dovetail Midstream, LLC (“Dovetail”), a wholly-owned subsidiary of Riley Exploration Permian, Inc (“Riley”), and on December 24, 2025, we completed the purchase of certain compressor assets from Riley for aggregate cash consideration of approximately $122.8 million for both the membership interests in Dovetail and certain compressor assets, subject to customary closing adjustments (together, the “Dovetail Acquisition”). The assets acquired in the Dovetail Acquisition primarily consist of compression and natural gas gathering infrastructure in Eddy County, New Mexico. Subject to certain volume-based performance thresholds, additional cash of up to $60.0 million may be payable to Riley over a five-year period. As part of the acquisition, we acquired approximately $55.1 million of Property, plant and equipment, net and recorded approximately $67.2 million of goodwill, which is fully deductible for federal income tax purposes.

The Dovetail Acquisition was accounted for under the acquisition method in accordance with ASC 805, Business Combinations, which requires, among other things, assets acquired and liabilities assumed to be recorded at their fair value on the acquisition date. The valuation of the acquired assets and liabilities was prepared using fair value methods and assumptions, including projections of future production volumes, commodity prices, and other cash flows, market-participant assumptions (e.g., discount rate and exit multiple), tangible asset replacement costs, and other management estimates. The fair value measurements of assets acquired and liabilities assumed are based on inputs that are not observable in the market and therefore represent Level 3 inputs, as defined in “Note 14 – Fair Value Measurements”. These inputs require judgments and estimates at the time of valuation. We are in the process of finalizing valuations related to property, plant and equipment, other assets, and contingent consideration. The final valuation will be completed no later than one year from the acquisition date.

The value of property, plant and equipment was determined using the cost approach and was primarily comprised of Gathering and Processing assets that will be depreciated on a straight-line basis over the useful lives of the assets. The associated useful lives of property, plant and equipment were based on the period over which the assets are expected to contribute directly or indirectly to our future cash flows.

In December 2025, we completed the purchase of certain midstream assets from Nile Midstream, LLC and Four Winds Midstream, LLC, both wholly-owned subsidiaries of Blackbeard Holdings, LLC, for aggregate cash consideration of $90.3 million, inclusive of capitalized transaction costs (the “Nile Acquisition”), subject to customary closing adjustments. The assets acquired in the Nile Acquisition primarily consist of compression and pipeline infrastructure. We allocated substantially all of the consideration paid to property, plant and equipment.

F-21

On January 6, 2026, we completed the acquisition of Stakeholder Midstream, LLC for a purchase price of $1.25 billion (the “Stakeholder Acquisition”), subject to customary closing adjustments. We acquired a portfolio of complementary Permian Basin midstream infrastructure assets, including approximately 480 miles of natural gas pipelines, approximately 180 MMcf/d of cryogenic natural gas processing and sour treating capacity, carbon capture activities generating 45Q tax credits, and a small crude oil gathering system. The acquisition has an effective date of January 1, 2026. We used $650.0 million in borrowings from the Commercial Paper Program and $600.0 million from the Securitization Facility to fund the Stakeholder Acquisition. At the time of this filing, it is impracticable to disclose all the information required by ASC 805, Business Combinations, as we are in the process of evaluating the purchase accounting implications of the transaction.

Note 5 — Property, Plant and Equipment and Intangible Assets

Property, Plant and Equipment and Intangible Assets

December 31, 2025

December 31, 2024

Estimated Useful Lives (In Years)

Gathering systems (1)

$

12,431.3

$

11,575.0

5 to 20

Processing and fractionation facilities

10,477.3

9,543.3

5 to 25

Terminaling and storage facilities

1,648.4

1,469.1

5 to 25

Transportation assets

4,536.0

4,131.5

10 to 50

Other property, plant and equipment

586.5

537.7

3 to 25

Land

209.3

198.6

—

Construction in progress (1)

2,804.9

1,702.9

—

Finance lease right-of-use assets

507.4

401.3

5 to 14

Property, plant and equipment

33,201.1

29,559.4

Accumulated depreciation, amortization and impairment

(12,666.3

)

(11,496.7

)

Property, plant and equipment, net

$

20,534.8

$

18,062.7

Intangible assets

4,378.0

4,378.0

10 to 20

Accumulated amortization and impairment

(2,726.6

)

(2,400.6

)

Intangible assets, net

$

1,651.4

$

1,977.4

(1)
The December 31, 2025 balance includes $133.1 million of gathering systems assets and $12.1 million of construction in progress from the Dovetail Acquisition and the Nile Acquisition. See “Note 4 – Acquisitions and Joint Ventures”.

For each of the years ended December 31, 2025, 2024 and 2023 depreciation expense was $1,189.3 million, $1,049.8 million and $945.6 million, respectively.

Intangible Assets

Intangible assets consist of customer contracts and customer relationships acquired in prior business combinations. The fair value of these acquired intangible assets were determined at the date of acquisition based on the present values of estimated future cash flows. Amortization expense attributable to these assets is recorded over the periods in which we benefit from services provided to customers.

For each of the years ended December 31, 2025, 2024 and 2023 amortization expense was $326.0 million, $373.2 million and $384.0 million, respectively.

The estimated annual amortization expense for intangible assets is approximately $279.8 million, $252.2 million, $234.0 million, $214.1 million and $184.3 million for each of the years 2026 through 2030. As of December 31, 2025, the weighted average amortization period for our intangible assets was approximately 9 years.

The following table shows the changes in our intangible assets for the periods presented:

December 31, 2025

December 31, 2024

Balance at beginning of period

$

1,977.4

$

2,350.6

Amortization

(326.0

)

(373.2

)

Balance at end of period

$

1,651.4

$

1,977.4

F-22

Note 6 — Goodwill

As of December 31, 2025, we had $112.3 million of goodwill included in Other long-term assets on the Consolidated Balance Sheets primarily related to the Dovetail Acquisition in 2025, as discussed in “Note 4 – Acquisitions and Joint Ventures”, and the March 2017 acquisition of gas gathering and processing and crude oil gathering assets in the Permian Basin. The goodwill resulting from the Dovetail Acquisition was attributed to the Permian Delaware reporting unit within our Gathering and Processing segment.

December 31, 2025

December 31, 2024

Permian Delaware

$

89.1

$

22.0

Permian Midland

23.2

23.2

Goodwill

$

112.3

$

45.2

The future cash flows and resulting fair values of these reporting units are sensitive to changes in crude oil, natural gas and NGL prices. The direct and indirect effects of significant declines in commodity prices from the date of acquisition would likely cause the fair values of these reporting units to fall below their carrying values, and could result in an impairment of goodwill.

As described in “Note 3 – Significant Accounting Policies”, we evaluate goodwill for impairment at least annually on November 30, or more frequently if we believe necessary based on events or changes in circumstances. For our 2025, 2024 and 2023 annual evaluations, we performed a qualitative assessment, which indicated that it is not more likely than not that the fair values of the Permian Midland and Permian Delaware reporting units were less than their carrying amounts, and therefore, a quantitative goodwill impairment test was not necessary. Our qualitative assessment considered, among other things, the overall financial performance and future outlook of the Permian Midland and Permian Delaware reporting units, industry and market considerations, and other relevant entity-specific events.

The fair value measurements utilized for the evaluation of goodwill for impairment are based on inputs that are not observable in the market and therefore represent Level 3 inputs, as defined in “Note 14 – Fair Value Measurements”. These inputs require significant judgments and estimates at the time a fair value assessment is required.

F-23

Note 7 — Investments in Unconsolidated Affiliates

Our investments in unconsolidated affiliates consist of the following:

Gathering and Processing Segment

•
50% operated ownership interest in Little Missouri 4.

Logistics and Transportation Segment

•
38.8% operated ownership interest in GCF;

•
50% operated ownership interest in Cayenne; and

•
17.5% non-operated ownership interest in Blackcomb and Traverse pipelines, which are currently under construction, held by the Blackcomb Joint Venture.

The terms of these joint venture agreements do not afford us the degree of control required for consolidating the entities in our consolidated financial statements, but do afford us the significant influence required to employ the equity method of accounting.

See “Note 4 – Acquisitions and Joint Ventures” for additional information related to our Blackcomb investment.

The following table shows the activity related to our investments in unconsolidated affiliates for the periods presented:

Balance at December 31, 2022

Equity Earnings (Loss)

Cash Distributions

Contributions

Balance at December 31, 2023

Little Missouri 4

90.7

7.7

(11.3

)

—

87.1

GCF (1)

27.1

(4.1

)

(2.0

)

24.6

45.6

Cayenne

13.5

5.4

(5.3

)

—

13.6

Total

$

131.3

$

9.0

$

(18.6

)

$

24.6

$

146.3

Balance at December 31, 2023

Equity Earnings (Loss)

Cash Distributions

Contributions

Balance at December 31, 2024

Little Missouri 4

$

87.1

$

14.4

$

(17.2

)

$

—

$

84.3

GCF (1)

45.6

(11.8

)

—

32.6

66.4

Cayenne

13.6

6.8

(8.1

)

—

12.3

Blackcomb

—

—

—

30.3

30.3

Total

$

146.3

$

9.4

$

(25.3

)

$

62.9

$

193.3

Balance at December 31, 2024

Equity Earnings (Loss)

Cash Distributions

Contributions (2)

Balance at December 31, 2025

Little Missouri 4

$

84.3

$

15.9

$

(21.5

)

$

15.0

$

93.7

GCF (1)

66.4

(1.2

)

—

4.0

69.2

Cayenne

12.3

7.0

(7.0

)

—

12.3

Blackcomb

30.3

(9.9

)

—

111.5

131.9

Total

$

193.3

$

11.8

$

(28.5

)

$

130.5

$

307.1

(1)
In January 2023, we reached an agreement with our partners to reactivate the GCF facility. GCF commenced operations in the first quarter of 2025.

(2)
Includes capitalized interest of $5.6 million related to our contributions to Blackcomb.

F-24

Note 8 — Debt Obligations

December 31, 2025

December 31, 2024

Current:

Partnership accounts receivable securitization facility, due August 2026 (1)

$

—

$

330.0

Senior unsecured notes issued by the Partnership: (2)

6.875% fixed rate, due January 2029 (3)

679.3

—

Debt issuance costs, net of amortization (3)

(2.3

)

—

Finance lease liabilities

93.1

57.7

Current debt obligations

770.1

387.7

Long-term:

TRGP senior revolving credit facility, variable rate, due February 2030 (4)

161.0

1,130.5

Senior unsecured notes issued by TRGP:

5.200% fixed rate, due July 2027

750.0

750.0

4.350% fixed rate, due January 2029 (3)

750.0

—

6.150% fixed rate, due March 2029

1,000.0

1,000.0

4.900% fixed rate, due September 2030 (5)

750.0

—

4.200% fixed rate, due February 2033

750.0

750.0

6.125% fixed rate, due March 2033

900.0

900.0

6.500% fixed rate, due March 2034

1,000.0

1,000.0

5.500% fixed rate, due February 2035

1,000.0

1,000.0

5.550% fixed rate, due August 2035 (6)

1,000.0

—

5.650% fixed rate, due February 2036 (5)

750.0

—

5.400% fixed rate, due July 2036 (3)

1,000.0

—

4.950% fixed rate, due April 2052

750.0

750.0

6.250% fixed rate, due July 2052

500.0

500.0

6.500% fixed rate, due February 2053

850.0

850.0

6.125% fixed rate, due May 2055 (6)

1,000.0

—

Unamortized discount

(38.3

)

(29.4

)

Senior unsecured notes issued by the Partnership: (2)

6.500% fixed rate, due July 2027 (5)

—

705.2

5.000% fixed rate, due January 2028

700.3

700.3

6.875% fixed rate, due January 2029 (3)

—

679.3

5.500% fixed rate, due March 2030

949.6

949.6

4.875% fixed rate, due February 2031

1,000.0

1,000.0

4.000% fixed rate, due January 2032

1,000.0

1,000.0

16,522.6

13,635.5

Debt issuance costs, net of amortization

(120.6

)

(89.0

)

Finance lease liabilities

260.4

240.4

Long-term debt

16,662.4

13,786.9

Total debt obligations

$

17,432.5

$

14,174.6

Irrevocable standby letters of credit: (4)

Letters of credit outstanding under the TRGP senior revolving credit facility

$

20.0

$

17.6

(1)
As of December 31, 2025, the Partnership had no amount drawn under its $600.0 million accounts receivable securitization facility (the “Securitization Facility”), resulting in $600.0 million of remaining availability.

(2)
We guarantee all of the Partnership’s outstanding senior unsecured notes.

(3)
On November 12, 2025, we completed an underwritten public offering of (i) $750.0 million aggregate principal amount of our 4.350% Senior Unsecured Notes due 2029 and (ii) $1.0 billion aggregate principal amount of our 5.400% Senior Unsecured Notes due 2036, resulting in net proceeds of approximately $1.7 billion. We used a portion of the net proceeds to reduce borrowings under the Commercial Paper Program in November 2025. On January 15, 2026, we used borrowings under the Commercial Paper Program and available cash to fund the redemption of all of the Partnership’s 6.875% Senior Unsecured Notes due 2029.

(4)
On February 18, 2025, we entered into a new $3.5 billion TRGP senior revolving credit facility (the “TRGP Revolver”), which matures in February 2030. In connection with our entry into the TRGP Revolver, we terminated our previous TRGP senior revolving credit facility (the “Previous TRGP Revolver”). We maintain an unsecured commercial paper note program (the “Commercial Paper Program”), the borrowings of which are supported through maintaining a minimum available borrowing capacity under the TRGP Revolver equal to the aggregate amount outstanding under the Commercial Paper Program at any one time not to exceed $3.5 billion. The TRGP Revolver had no borrowings outstanding and the Commercial Paper Program had $161.0 million of borrowings outstanding, resulting in approximately $3.3 billion of available liquidity as of December 31, 2025, after accounting for outstanding letters of credit.

(5)
On June 18, 2025, we completed an underwritten public offering of (i) $750.0 million aggregate principal amount of our 4.900% Senior Unsecured Notes due 2030 and (ii) $750.0 million aggregate principal amount of our 5.650% Senior Unsecured Notes due 2036, resulting in net proceeds of approximately $1.5 billion. We used a portion of the net proceeds to reduce borrowings under the Securitization Facility and Commercial Paper Program. On July 15, 2025, we used borrowings under the Securitization Facility and Commercial Paper Program to fund the redemption of all of the Partnership’s 6.500% Senior Unsecured Notes due 2027.

(6)
On February 24, 2025, we completed an underwritten public offering of (i) $1.0 billion aggregate principal amount of our 5.550% Senior Unsecured Notes due 2035 and (ii) $1.0 billion aggregate principal amount of our 6.125% Senior Unsecured Notes due 2055, resulting in net proceeds of approximately $2.0 billion.

F-25

The following table shows the range of interest rates and weighted average interest rate incurred on our variable-rate debt obligations during the year ended December 31, 2025:

Range of Interest Rates Incurred

Weighted Average Interest Rate Incurred

TRGP Revolver and Commercial Paper Program

3.9% - 4.8%

4.6%

Securitization Facility

4.7% - 5.3%

5.2%

Compliance with Debt Covenants

As of December 31, 2025, we were in compliance with the covenants contained in our various debt agreements.

We and certain of our subsidiaries are parties to a parent guarantee whereby each party to the agreement unconditionally guarantees, jointly and severally, the payment of all of the obligations of the Partnership and Targa Resources Partners Finance Corporation (together with the Partnership, the “Partnership Issuers”) under the respective indentures governing the Partnership Issuers’ senior unsecured notes.

Debt Obligations

Partnership’s Accounts Receivable Securitization Facility

The Securitization Facility provides up to $600.0 million of borrowing capacity at SOFR rates plus a margin. On July 28, 2025, the Partnership amended the Securitization Facility to, among other things, extend the termination date of the Securitization Facility to August 31, 2026. Under the Securitization Facility, certain Partnership subsidiaries sell or contribute certain qualifying receivables, without recourse, to another of its consolidated subsidiaries (Targa Receivables LLC or “TRLLC”), a special purpose consolidated subsidiary created for the sole purpose of the Securitization Facility. TRLLC, in turn, sells an undivided percentage ownership in the eligible receivables to third-party financial institutions. Sold or contributed receivables up to the amount of the outstanding debt under the Securitization Facility are not available to satisfy the claims of the creditors of the selling or contributing subsidiaries or the Partnership. Any excess receivables are eligible to satisfy the claims.

TRGP Revolver

On February 18, 2025, we entered into a Credit Agreement with Bank of America, N.A., as the Administrative Agent and Swing Line Lender, the letter of credit issuers party thereto and the other lenders party thereto. The TRGP Revolver provides for a revolving credit facility in an initial aggregate principal amount up to $3.5 billion (with an option to increase such maximum aggregate principal amount by up to $500.0 million in the future, subject to the terms of the TRGP Revolver) and a swing line sub-facility of up to $150.0 million. We recorded $8.9 million of debt issuance costs related to the TRGP Revolver in Other long-term assets on our Consolidated Balance Sheets. The TRGP Revolver matures on February 18, 2030. We will be able to extend the maturity date, subject to the required lenders’ consent, by one year up to two times.

The revolving credit facility bears interest at the Company’s option at: (a) the Base Rate (as such term is defined in the TRGP Revolver), which is the highest of Bank of America’s prime rate, the federal funds rate plus 0.5% and the Term SOFR (as such term is defined in the TRGP Revolver) rate plus 1.0% (subject in each case to a floor of 0.0%), plus an applicable margin ranging from 0.0% to 0.625%, dependent on the Company’s non-credit-enhanced senior unsecured long-term debt ratings (or, if no such debt is outstanding at such time, then the corporate, issuer or similar rating with respect to the Company that has been most recently announced) (the “Debt Rating”), or (b) Term SOFR (which is subject to a floor of 0.0% and includes, for Term SOFR loans, a SOFR adjustment of plus 0.10%) plus an applicable margin ranging from 1.00% to 1.625%, dependent on the Company’s Debt Rating.

The Company is required to pay a commitment fee equal to an applicable rate ranging from 0.10% to 0.275% (dependent on the Company’s Debt Rating), in each case times the actual daily unused portion of the revolving credit facility.

The obligations under the TRGP Revolver are guaranteed by Targa Resources GP LLC, Targa Energy GP LLC, Targa Resources LLC, Targa Resources Partners LP, Targa Energy LP, Targa GP Inc., Targa LP Inc., and Targa Resources Finance Corporation. The TRGP Revolver shall also be guaranteed by each existing and future direct and indirect wholly-owned subsidiary of the Company that is an obligor on or otherwise guarantees the obligations in respect of the existing notes indebtedness of Targa Resources Partners LP.

F-26

The TRGP Revolver requires the Company to maintain a Consolidated Leverage Ratio (as such term is defined in the TRGP Revolver), determined as of the last day of each quarter for the four-fiscal quarter period ending on the date of determination, of no more than 5.50 to 1.00. For any four-fiscal-quarter-period during which a material acquisition occurs, the total leverage ratio may, at the Company’s option, be determined on a pro forma basis as though such event had occurred as of the first day of such four-fiscal-quarter-period.

The TRGP Revolver restricts the Company’s ability to make dividends to stockholders if an event of default (as defined in the TRGP Revolver) exists or would result from such distribution. In addition, the TRGP Revolver contains various covenants that may limit, among other things, the Company’s ability to grant liens, merge or consolidate, and engage in transactions with affiliates and the ability of the Company’s non-guarantor subsidiaries to incur indebtedness.

The TRGP Revolver also contains various customary events of default, the occurrence of which could result in a termination of the lenders’ commitments and the acceleration of all of our obligations thereunder.

Previous TRGP Revolver

In February 2022, the Company entered into the Previous TRGP Revolver with Bank of America, N.A., as the Administrative Agent, Collateral Agent and Swing Line Lender, the Letter of Credit issuers party thereto and the lenders party thereto. The Previous TRGP Revolver provided for a revolving credit facility in an initial aggregate principal amount up to $2.75 billion and a swing line sub-facility of up to $100.0 million. The Previous TRGP Revolver was scheduled to mature on February 17, 2027. In connection with our entry into the TRGP Revolver, we terminated the Previous TRGP Revolver. As a result of the termination of the Previous TRGP Revolver, we recorded a loss due to debt extinguishment of $0.6 million.

The revolving credit facility bore interest at the Company’s option at: (a) the Base Rate (as such term is defined in the Previous TRGP Revolver), which is the highest of Bank of America’s prime rate, the federal funds rate plus 0.5% and the Term SOFR (as such term is defined in the Previous TRGP Revolver) rate plus 1.0% (subject in each case to a floor of 0.0%), plus an applicable margin ranging from 0.125% to 0.75%, dependent on the Company’s non-credit-enhanced senior unsecured long-term debt ratings (or, if no such debt was outstanding at such time, then the corporate, issuer or similar rating with respect to the Company that had been most recently announced) (the “Debt Rating”), or (b) Term SOFR (which included, for Term SOFR loans, a SOFR adjustment of plus 0.10%) plus an applicable margin ranging from 1.125% to 1.75%, dependent on the Company’s Debt Rating.

Commercial Paper Program

In July 2022, we established the Commercial Paper Program. Under the terms of the Commercial Paper Program, we may issue, from time to time, unsecured commercial paper notes with varying maturities of less than one year. Amounts available under the Commercial Paper Program may be issued, repaid and re-issued from time to time, with the maximum aggregate face or principal amount outstanding at any one time not to exceed $3.5 billion, subject to documentation requirements of the Commercial Paper Program. We maintain a minimum available borrowing capacity under the TRGP Revolver equal to the aggregate amount outstanding under the Commercial Paper Program to support our issued commercial paper notes. The Commercial Paper Program is guaranteed by each subsidiary that guarantees the TRGP Revolver. The commercial paper notes are presented in Long-term debt on our Consolidated Balance Sheets.

TRGP’s Senior Unsecured Notes

All series of our senior unsecured notes (the “TRGP Notes”) rank pari passu with our existing and future senior indebtedness, including debt issued under the TRGP Revolver and the Commercial Paper Program, and rank senior in right of payment to any of our future subordinated indebtedness. The TRGP Notes are unconditionally guaranteed by certain of our subsidiaries that guarantee the TRGP Revolver. Each guarantee ranks equally in right of payment with all of such guarantor’s existing and future unsecured senior debt and other unsecured guarantees of senior debt. The notes and the guarantees are effectively junior to any secured indebtedness of ours or any guarantor to the extent of the value of the assets securing such indebtedness and structurally subordinated to all indebtedness and other obligations of our subsidiaries that do not guarantee the notes. Interest on all issues of TRGP Notes is payable semi-annually.

The indenture governing the TRGP Notes restricts (i) our ability and the ability of our subsidiaries to incur liens and (ii) TRGP’s ability to merge or consolidate with or sell, lease, convey, transfer or otherwise dispose of all or substantially all of its assets to another company. These covenants are subject to a number of important exceptions and qualifications.

F-27

We may redeem the TRGP Notes, in whole or in part, at any time prior to the applicable par call date at a redemption price equal to the principal amount plus an applicable make-whole premium, plus accrued and unpaid interest, to the redemption date, as specified in the indenture of each series. After the applicable par call date, the TRGP Notes may be redeemed at a price equal to par, plus accrued and unpaid interest to the redemption date, as specified in the indenture of each series.

In the future, we may redeem, purchase or exchange certain of our outstanding debt through redemption calls, cash purchases and/or exchanges for other debt, in open market purchases, privately negotiated transactions or otherwise. Such calls, repurchases or exchanges, if any, will depend on prevailing market conditions, our liquidity requirements, contractual restrictions and other factors. The amounts involved may be material.

Partnership’s Senior Unsecured Notes

All series of the Partnership’s senior unsecured notes are pari passu with the Partnership’s existing and future senior indebtedness. They are senior in right of payment to any of the Partnership’s future subordinated indebtedness and are unconditionally guaranteed by the Partnership’s restricted subsidiaries. These notes are effectively subordinated to all secured indebtedness under the Securitization Facility, which is secured by accounts receivable pledged under the facility, to the extent of the value of the collateral securing that indebtedness. Interest on all issues of senior unsecured notes is payable semi-annually in arrears.

The Partnership’s senior unsecured notes and associated indenture agreements restrict, among other things, (i) the Partnership’s ability and the ability of certain of its subsidiaries to incur liens and (ii) the Partnership’s ability to merge or consolidate with or sell, lease, convey, transfer or otherwise dispose of all or substantially all of its assets to another company. These covenants are subject to a number of important exceptions and qualifications.

The Partnership may redeem its senior unsecured notes, in whole or in part, at any time prior to their applicable maturity at a redemption price equal to the principal amount plus an applicable make-whole premium, plus accrued and unpaid interest and liquidation damages, if any, to the redemption date, as specified in the indenture of each series.

The Partnership may also redeem up to 35% of the aggregate principal amount of each series of its senior unsecured notes at the redemption dates and prices set forth in the indenture governing such series plus accrued and unpaid interest and liquidation damages, if any, to the redemption date with the net cash proceeds of one or more equity offerings, provided that: (i) at least 65% of the aggregate principal amount of each such notes (excluding notes held by the Partnership and its subsidiaries) remains outstanding immediately after the occurrence of such redemption; and (ii) the redemption occurs within 180 days of the date of the closing of such equity offering.

In the future, we or the Partnership may redeem, purchase or exchange certain of our and the Partnership’s outstanding debt through redemption calls, cash purchases and/or exchanges for other debt, in open market purchases, privately negotiated transactions or otherwise. Such calls, repurchases or exchanges, if any, will depend on prevailing market conditions, our liquidity requirements, contractual restrictions and other factors. The amounts involved may be material.

Senior Unsecured Notes Issuances

In January 2023, we completed an underwritten public offering of (i) $900.0 million aggregate principal amount of our 6.125% Senior Unsecured Notes due 2033 (the “6.125% Notes due 2033”) and (ii) $850.0 million aggregate principal amount of our 6.500% Senior Unsecured Notes due 2053 (the “6.500% Notes due 2053”) (collectively, the “January 2023 Senior Unsecured Notes”), resulting in net proceeds of approximately $1.7 billion. The January 2023 Senior Unsecured Notes are fully and unconditionally guaranteed, jointly and severally, on a senior unsecured basis by our subsidiaries that guarantee the TRGP Revolver, so long as such subsidiary guarantors satisfy certain conditions. The January 2023 Senior Unsecured Notes were issued pursuant to the Indenture, dated as of April 6, 2022, as supplemented by that certain Fifth Supplemental Indenture, dated as of January 9, 2023, among us, such subsidiary guarantors and U.S. Bank Trust Company, National Association, as trustee. We used a portion of the net proceeds from the issuance to fund the Grand Prix Transaction and the remaining proceeds for general corporate purposes, including to reduce borrowings under the Previous TRGP Revolver and the Commercial Paper Program.

F-28

In November 2023, we completed an underwritten public offering of (i) $1.0 billion aggregate principal amount of our 6.150% Senior Unsecured Notes due 2029 (the “6.150% Notes due 2029”) and (ii) $1.0 billion aggregate principal amount of our 6.500% Senior Unsecured Notes due 2034 (the “6.500% Notes due 2034”) (collectively, the “November 2023 Senior Unsecured Notes”), resulting in net proceeds of approximately $2.0 billion. The November 2023 Senior Unsecured Notes are fully and unconditionally guaranteed, jointly and severally, on a senior unsecured basis by our subsidiaries that guarantee the TRGP Revolver, so long as such subsidiary guarantors satisfy certain conditions. The November 2023 Senior Unsecured Notes were issued pursuant to the Indenture, dated as of April 6, 2022, as supplemented by that certain Seventh Supplemental Indenture, dated as of November 9, 2023, among us, such subsidiary guarantors and U.S. Bank Trust Company, National Association, as trustee. We used a portion of the net proceeds to repay $1.0 billion in borrowings under the $1.5 billion unsecured term loan facility due July 2025 (the “Term Loan Facility”) and the remaining net proceeds for general corporate purposes, including to repay borrowings under the Commercial Paper Program.

In August 2024, we completed an underwritten public offering of $1.0 billion aggregate principal amount of our 5.500% Senior Unsecured Notes due 2035 (the “5.500% Notes due 2035”), resulting in net proceeds of approximately $990.1 million. The 5.500% Notes due 2035 are fully and unconditionally guaranteed, jointly and severally, on a senior unsecured basis by our subsidiaries that guarantee the TRGP Revolver, so long as such subsidiary guarantors satisfy certain conditions. The 5.500% Notes due 2035 were issued pursuant to the Indenture, dated as of April 6, 2022, as supplemented by that certain Ninth Supplemental Indenture, dated as of August 9, 2024, among us, each subsidiary guarantor and U.S. Bank Trust Company, National Association, as trustee. We used a portion of the net proceeds from the issuance to repay borrowings under the Commercial Paper Program, a portion of which were incurred to repay the remaining balance under the Term Loan Facility, and for general corporate purposes.

In February 2025, we completed an underwritten public offering of (i) $1.0 billion aggregate principal amount of our 5.550% Senior Unsecured Notes due 2035 (the “5.550% Notes due 2035”) and (ii) $1.0 billion aggregate principal amount of our 6.125% Senior Unsecured Notes due 2055 (the “6.125% Notes due 2055”) (collectively, the “February 2025 Senior Unsecured Notes”), resulting in net proceeds of approximately $2.0 billion. The February 2025 Senior Unsecured Notes are fully and unconditionally guaranteed, jointly and severally, on a senior unsecured basis by our subsidiaries that guarantee the TRGP Revolver, so long as such subsidiary guarantors satisfy certain conditions. The February 2025 Senior Unsecured Notes were issued pursuant to the Indenture, dated as of April 6, 2022, as supplemented by that certain Tenth Supplemental Indenture, dated as of February 27, 2025, among us, each subsidiary guarantor and U.S. Bank Trust Company, National Association, as trustee. In connection with the offering, we recorded debt issuance costs of $20.4 million and discount of $6.1 million as reductions to the carrying value of the February 2025 Senior Unsecured Notes in Long-term debt on our Consolidated Balance Sheets. We used a portion of the net proceeds from the debt issuance to fund the Badlands Transaction and the remaining net proceeds for general corporate purposes, including to repay borrowings under the Commercial Paper Program.

In June 2025, we completed an underwritten public offering of (i) $750.0 million aggregate principal amount of our 4.900% Senior Unsecured Notes due 2030 (the “4.900% Notes due 2030”) and (ii) $750.0 million aggregate principal amount of our 5.650% Senior Unsecured Notes due 2036 (the “5.650% Notes due 2036”) (collectively, the “June 2025 Senior Unsecured Notes”), resulting in net proceeds of approximately $1.5 billion. The June 2025 Senior Unsecured Notes are fully and unconditionally guaranteed, jointly and severally, on a senior unsecured basis by our subsidiaries that guarantee the TRGP Revolver, so long as such subsidiary guarantors satisfy certain conditions. The June 2025 Senior Unsecured Notes were issued pursuant to the Indenture, dated as of April 6, 2022, as supplemented by that certain Eleventh Supplemental Indenture, dated as of June 18, 2025, among us, each subsidiary guarantor and U.S. Bank Trust Company, National Association, as trustee. In connection with the offering, we recorded debt issuance costs of $13.6 million and discount of $3.2 million as reductions to the carrying value of the June 2025 Senior Unsecured Notes in Long-term debt on our Consolidated Balance Sheets. We used a portion of the net proceeds from the debt issuance to reduce borrowings under the Securitization Facility and Commercial Paper Program in June 2025. On July 15, 2025, we used borrowings under the Securitization Facility and Commercial Paper Program to fund the redemption of all of the Partnership’s 6.500% Senior Unsecured Notes due 2027 (the “6.500% Notes due 2027”).

In November 2025, we completed an underwritten public offering of (i) $750.0 million aggregate principal amount of our 4.350% Senior Unsecured Notes due 2029 (the “4.350% Notes due 2029”) and (ii) $1.0 billion aggregate principal amount of our 5.400% Senior Unsecured Notes due 2036 (the “5.400% Notes due 2036”) (collectively, the “November 2025 Senior Unsecured Notes”), resulting in net proceeds of approximately $1.7 billion. The November 2025 Senior Unsecured Notes are fully and unconditionally guaranteed, jointly and severally, on a senior unsecured basis by our subsidiaries that guarantee the TRGP Revolver, so long as such subsidiary guarantors satisfy certain conditions. The November 2025 Senior Unsecured Notes were issued pursuant to the Indenture, dated as of April 6, 2022, as supplemented by that certain Twelfth Supplemental Indenture, dated as of November 12, 2025, among us, each subsidiary guarantor and U.S. Bank Trust Company, National Association, as trustee. In connection with the offering, we recorded debt issuance costs of $13.8 million and discount of $1.3 million as reductions to the carrying value of the November 2025 Senior Unsecured Notes in Long-term debt on our Consolidated Balance Sheets. We used a portion of the net proceeds from the debt issuance to reduce borrowings under the Commercial Paper Program in November 2025. On January 15, 2026, we used borrowings under the Commercial Paper Program and available cash to fund the redemption of all of the Partnership’s 6.875% Senior Unsecured Notes due 2029 (the “6.875% Notes due 2029”).

F-29

Debt Repurchases & Extinguishments

In November 2023, in connection with the November 2023 Senior Unsecured Notes, we repaid borrowings under the Term Loan Facility and the Commercial Paper Program. As a result of the repayment of borrowings under the Term Loan Facility, we recorded a loss of $2.1 million due to a write-off of debt issuance costs.

In May 2024, we repaid the Term Loan Facility, which bore interest at the Company’s option at: (a) the Base Rate (as defined in the Term Loan Facility), which was the highest of the (i) federal funds rate plus 0.5%, (ii) Mizuho’s prime rate, and (iii) the Term SOFR (as defined in the Term Loan Facility) rate plus 1.0% (subject in each case to a floor of 0.0%), plus an applicable margin ranging from 0.125% to 0.75% dependent on the Company’s non-credit-enhanced senior unsecured long-term debt ratings (or, if no such debt is outstanding at such time, then the Debt Rating), or (b) Term SOFR plus 0.10% plus an applicable margin ranging from 1.125% to 1.75% dependent on the Debt Rating. As a result of the repayment, we recorded a loss due to debt extinguishment of $0.8 million.

On July 15, 2025, we completed the redemption of all of the Partnership’s 6.500% Notes due 2027 and recorded a debt extinguishment loss of $1.9 million due to a write-off of debt issuance costs.

On January 15, 2026, we completed the redemption of all of the Partnership’s 6.875% Notes due 2029 and recognized a debt extinguishment loss of $10.1 million, comprised of $7.8 million related to the redemption premium paid and $2.3 million from the write-off of debt issuance costs.

The following table shows the contractually scheduled maturities of our debt obligations outstanding at December 31, 2025, for the next five years, and in total thereafter:

Scheduled Maturities of Debt

Total

2026

2027

2028

2029

2030

Thereafter

TRGP Revolver and Commercial Paper Program

$

161.0

$

—

$

—

$

—

$

—

$

161.0

$

—

TRGP Senior unsecured notes

12,750.0

—

750.0

—

1,750.0

750.0

9,500.0

Partnership’s Senior unsecured notes

4,329.2

679.3

—

700.3

—

949.6

2,000.0

Total

$

17,240.2

$

679.3

$

750.0

$

700.3

$

1,750.0

$

1,860.6

$

11,500.0

Financing for Stakeholder Acquisition

On January 6, 2026, we used $650.0 million in borrowings from the Commercial Paper Program and $600.0 million from the Securitization Facility to fund the Stakeholder Acquisition. See “Note 4 – Acquisitions and Joint Ventures” for further details on the Stakeholder Acquisition.

Note 9 — Other Long-term Liabilities

Other long-term liabilities are comprised of the noncurrent portion of the following obligations as of the periods presented:

December 31, 2025

December 31, 2024

Deferred revenue

$

115.5

$

119.9

Asset retirement obligations

185.4

177.7

Operating lease liabilities

89.5

90.4

Other liabilities

4.6

4.3

Total other long-term liabilities

$

395.0

$

392.3

See “Note 18 – Revenue” for additional disclosures related to Deferred revenue.

F-30

Asset Retirement Obligations

Our AROs primarily relate to certain processing facilities, compressor stations and inactive pipelines. The following table shows changes in our ARO liability for the periods presented:

2025

2024

Balance at beginning of period

$

177.7

$

103.0

Additions

3.4

23.8

Accretion expense

6.2

10.6

Retirements

(2.5

)

—

Change in cash flow estimate

0.6

40.3

Balance at end of period

$

185.4

$

177.7

Note 10 — Leases

We have non-cancellable operating leases primarily associated with our compressors, office facilities, rail assets, land, storage and terminal assets. We have finance leases primarily associated with our compressors, vehicles, generators, substations and tractors. Our leases have remaining lease terms of 1 to 10 years, some of which include options to extend the lease term for up to 20 years.

The following table shows balances of right-of-use assets and liabilities of finance leases and operating leases, and their locations on our Consolidated Balance Sheets as of the periods presented:

December 31,

Balance Sheet Location

2025

2024

Operating leases:

Lease right-of-use assets, net

Other long-term assets

$

93.9

$

103.7

Current liabilities

Accrued liabilities

24.3

25.2

Non-current liabilities

Other long-term liabilities

89.5

90.4

Finance leases:

Lease right-of-use assets, net

Property, plant and equipment, net

$

324.9

$

285.1

Current liabilities

Current debt obligations

93.1

57.7

Non-current liabilities

Long-term debt

260.4

240.4

Operating lease costs and short-term lease costs are included in Operating expenses or General and administrative expense in our Consolidated Statements of Operations, depending on the nature of the leases. Finance lease costs are included in Depreciation and amortization expense and Interest expense, net in our Consolidated Statements of Operations. The following table shows components of lease expense for the periods presented:

Year Ended December 31,

2025

2024

2023

Lease cost

Operating lease cost

$

28.6

$

30.6

$

18.3

Short-term lease cost

36.5

45.2

56.7

Variable lease cost

52.5

46.0

26.0

Finance lease cost

Amortization of right-of-use assets

75.0

55.3

48.2

Interest expense

16.1

14.5

14.0

Total lease cost

$

208.7

$

191.6

$

163.2

The following table shows other supplemental information related to our leases for the periods presented:

Year Ended December 31,

2025

2024

2023

Cash paid for amounts included in the measurement of lease liabilities

Operating cash flows for operating leases

$

32.4

$

32.4

$

21.4

Operating cash flows for finance leases

15.9

14.2

13.9

Financing cash flows for finance leases

76.5

50.1

42.9

The weighted-average remaining lease terms for operating leases and finance leases are 5 years and 4 years, respectively. The weighted-average discount rates for operating leases and finance leases are 5.0% and 4.9%, respectively.

F-31

The following table presents the maturities of our lease liabilities under non-cancellable leases as of December 31, 2025:

Operating Leases

Finance Leases

2026

$

23.1

$

107.5

2027

29.0

100.5

2028

24.2

75.4

2029

19.3

59.0

2030

13.7

37.6

Thereafter

20.7

8.0

Total undiscounted cash flows

130.0

388.0

Less imputed interest

(16.2

)

(34.5

)

Total lease liabilities

$

113.8

$

353.5

Note 11 — Common Stock and Related Matters

Public Offerings of Common Stock

In March 2025, we filed with the SEC a universal shelf registration statement on Form S-3 that registers the issuance of certain debt and equity securities from time to time in one or more offerings (the “March 2025 Shelf”). The March 2025 Shelf will expire in March 2028.

Common Share Repurchase Program

In May 2023, our Board of Directors approved a share repurchase program (the “2023 Share Repurchase Program”) for the repurchase of up to $1.0 billion of our outstanding common stock. During the first quarter of 2025, we exhausted the 2023 Share Repurchase Program.

In July 2024, our Board of Directors approved a share repurchase program (the “2024 Share Repurchase Program”) for the repurchase of up to $1.0 billion of our outstanding common stock. In addition, in August 2025, our Board of Directors approved a new share repurchase program (the “2025 Share Repurchase Program” and, together with the 2024 Share Repurchase Program, the “Share Repurchase Programs”) for the repurchase of up to $1.0 billion of our outstanding common stock. We are not obligated to repurchase any specific dollar amount or number of shares under the Share Repurchase Programs and may discontinue these programs at any time.

For the year ended December 31, 2025, we repurchased 3,765,272 shares of our common stock at a weighted average price per share of $170.45 for a total net cost of $641.8 million. For the year ended December 31, 2024, we repurchased 5,933,050 shares of our common stock at a weighted average price per share of $127.20 for a total net cost of $754.7 million. For the year ended December 31, 2023, we repurchased 4,870,559 shares of our common stock at a weighted average price per share of $76.72 for a total net cost of $373.7 million.

As of December 31, 2025, there was $1,373.6 million remaining under the Share Repurchase Programs.

Common Stock Dividends

In April 2025, we declared an increase to our quarterly common dividend to $1.00 per common share, or $4.00 per common share annualized, effective for the first quarter of 2025.

F-32

The following table details the dividends declared and/or paid by us to common shareholders for the years ended December 31, 2025, 2024 and 2023:

Three Months Ended

Date Paid or

To Be Paid

Total Common

Dividends Declared

Amount of Common

Dividends Paid or

To Be Paid

Dividends on

Share-Based Awards

Dividends Declared per Share of Common Stock

(In millions, except per share amounts)

2025

December 31, 2025

February 13, 2026

$

216.7

$

215.0

$

1.7

$

1.00000

September 30, 2025

November 17, 2025

216.9

214.7

2.2

1.00000

June 30, 2025

August 15, 2025

217.6

215.2

2.4

1.00000

March 31, 2025

May 15, 2025

219.0

216.9

2.1

1.00000

2024

December 31, 2024

February 14, 2025

$

165.2

$

163.6

$

1.6

$

0.75000

September 30, 2024

November 15, 2024

165.2

163.5

1.7

0.75000

June 30, 2024

August 15, 2024

166.1

164.3

1.8

0.75000

March 31, 2024

May 15, 2024

168.1

166.3

1.8

0.75000

2023

December 31, 2023

February 15, 2024

$

112.8

$

111.6

$

1.2

$

0.50000

September 30, 2023

November 15, 2023

113.0

111.5

1.5

0.50000

June 30, 2023

August 15, 2023

113.6

111.8

1.8

0.50000

March 31, 2023

May 15, 2023

114.7

113.0

1.7

0.50000

Note 12 — Earnings per Common Share

Restricted Stock Unit awards (“RSUs”) that vest no later than three years following the RSUs’ grant date participate in quarterly cash dividend payments. As these RSUs and certain four-year retention awards participate in nonforfeitable dividends with the common equity owners of the Company, they are considered participating securities.

We calculate earnings per share using the two-class method. Earnings are allocated to common stock and participating securities based on the amount of dividends paid in the current period plus an allocation of the undistributed earnings to the extent that each security participates in earnings.

The following table sets forth a reconciliation of net income and weighted average shares outstanding used in computing basic and diluted net income per common share for the periods presented:

Year Ended December 31,

2025

2024

2023

(In millions, except per share amounts)

Net income (loss) attributable to Targa Resources Corp.

$

1,923.0

$

1,312.0

$

1,345.9

Less: Premium on repurchase of noncontrolling interests, net of tax (1)

70.5

32.9

510.1

Net income (loss) attributable to common shareholders

1,852.5

1,279.1

835.8

Less: Participating share-based earnings (2)

11.1

9.6

7.6

Net income (loss) allocated to common shareholders for basic earnings per share

$

1,841.4

$

1,269.5

$

828.2

Weighted average shares outstanding - basic

216.1

220.2

224.6

Dilutive effect of unvested restricted stock awards

0.8

1.1

1.4

Weighted average shares outstanding - diluted

216.9

221.3

226.0

Net income (loss) available per common share - basic

$

8.52

$

5.77

$

3.69

Net income (loss) available per common share - diluted

$

8.49

$

5.74

$

3.66

(1)
Represents premiums paid on the Badlands Transaction, the CBF Acquisition, the Carnero Acquisition, and the Grand Prix Transaction. See “Note 4 – Acquisitions and Joint Ventures”.

(2)
Represents the distributed and undistributed earnings of the Company attributable to the participating securities. The dilutive effect of the reallocation of participating securities to diluted net income attributable to common shareholders was immaterial.

F-33

The following potential common stock equivalents are excluded from the determination of diluted earnings per share because the inclusion of such shares would have been anti-dilutive (in millions on a weighted-average basis):

Year Ended December 31,

2025

2024

2023

Unvested restricted stock awards

1.0

1.2

1.5

Note 13 — Derivative Instruments and Hedging Activities

The primary purpose of our commodity risk management activities is to manage our exposure to commodity price risk and reduce volatility in our operating cash flow due to fluctuations in commodity prices. We have entered into derivative instruments to hedge the commodity price risks associated with a portion of our expected (i) natural gas, NGL, and condensate equity volumes in our Gathering and Processing operations that result from percent-of-proceeds processing arrangements, (ii) future commodity purchases and sales in our Logistics and Transportation segment and (iii) natural gas transportation basis risk in our Logistics and Transportation segment. The hedge positions associated with (i) and (ii) above will move favorably in periods of falling commodity prices and unfavorably in periods of rising commodity prices and are primarily designated as cash flow hedges for accounting purposes.

The hedges generally match the NGL product composition and the NGL delivery points of our physical equity volumes. Our natural gas hedges are a mixture of specific gas delivery points and Henry Hub. The NGL hedges may be transacted as specific NGL hedges or as baskets of ethane, propane, normal butane, isobutane and natural gasoline based upon our expected equity NGL composition. We believe this approach avoids uncorrelated risks resulting from employing hedges on crude oil or other petroleum products as “proxy” hedges of NGL prices. Our natural gas and NGL hedges are settled using published index prices for delivery at various locations.

We hedge a portion of our condensate equity volumes using crude oil hedges that are based on NYMEX futures contracts for West Texas Intermediate light, sweet crude, which approximates the prices received for condensate. This exposes us to a market differential risk if NYMEX futures do not move in exact parity with the sales price of our underlying condensate equity volumes.

We also enter into derivative instruments to help manage other short-term commodity-related business risks and take advantage of market opportunities. We have not designated these derivatives as hedges and record changes in fair value and cash settlements to revenues in current earnings.

At December 31, 2025, the notional volumes of our commodity derivative contracts were:

Commodity

Instrument

Unit

2026

2027

2028

2029

Natural Gas

Swaps

MMBtu/d

93,304

77,778

58,189

—

Natural Gas

Basis Swaps

MMBtu/d

490,370

336,829

157,298

24,959

NGL

Swaps

Bbl/d

37,384

23,956

17,739

—

NGL

Futures

Bbl/d

24,099

—

—

—

Condensate

Swaps

Bbl/d

8,249

3,316

2,452

—

Our derivative contracts are subject to netting arrangements that permit our contracting subsidiaries to net cash settle offsetting asset and liability positions with the same counterparty within the same Targa entity. The master netting provisions reduced our maximum loss due to counterparty credit risk by $6.2 million as of December 31, 2025. The range of losses attributable to our individual counterparties would be between $0.1 million and $14.9 million, depending on the counterparty in default. We record derivative assets and liabilities on our Consolidated Balance Sheets on a gross basis, without considering the effect of master netting arrangements.

F-34

The following table reflects the fair value of our derivative instruments and their location on our Consolidated Balance Sheets as of the periods presented:

Fair Value as of December 31, 2025

Fair Value as of December 31, 2024

Balance Sheet

Derivative

Derivative

Derivative

Derivative

Location

Assets

Liabilities

Assets

Liabilities

Derivatives designated as hedging instruments

Commodity contracts

Current

$

137.1

$

(14.8

)

$

50.8

$

(29.0

)

Long-term

26.1

(6.9

)

20.8

(11.7

)

Total derivatives designated as hedging instruments

$

163.2

$

(21.7

)

$

71.6

$

(40.7

)

Derivatives not designated as hedging instruments

Commodity contracts

Current

$

17.6

$

(219.3

)

$

11.0

$

(138.3

)

Long-term

8.9

(15.6

)

4.5

(80.3

)

Total derivatives not designated as hedging instruments

$

26.5

$

(234.9

)

$

15.5

$

(218.6

)

Total current position

$

154.7

$

(234.1

)

$

61.8

$

(167.3

)

Total long-term position

35.0

(22.5

)

25.3

(92.0

)

Total derivatives

$

189.7

$

(256.6

)

$

87.1

$

(259.3

)

The following tables reflect the pro forma impact of reporting derivatives on our Consolidated Balance Sheets on a net basis as of the periods presented:

Gross Presentation

Pro Forma Net Presentation

December 31, 2025

Asset

Liability

Collateral

Asset

Liability

Current Position

Counterparties with offsetting positions or collateral

$

133.3

$

(234.1

)

$

29.6

$

31.3

$

(102.5

)

Counterparties without offsetting positions - assets

21.4

—

—

21.4

—

Counterparties without offsetting positions - liabilities

—

—

—

—

—

154.7

(234.1

)

29.6

52.7

(102.5

)

Long-Term Position

Counterparties with offsetting positions or collateral

33.4

(22.5

)

(2.7

)

15.3

(7.1

)

Counterparties without offsetting positions - assets

1.6

—

—

1.6

—

Counterparties without offsetting positions - liabilities

—

—

—

—

—

35.0

(22.5

)

(2.7

)

16.9

(7.1

)

Total Derivatives

Counterparties with offsetting positions or collateral

166.7

(256.6

)

26.9

46.6

(109.6

)

Counterparties without offsetting positions - assets

23.0

—

—

23.0

—

Counterparties without offsetting positions - liabilities

—

—

—

—

—

$

189.7

$

(256.6

)

$

26.9

$

69.6

$

(109.6

)

Gross Presentation

Pro Forma Net Presentation

December 31, 2024

Asset

Liability

Collateral

Asset

Liability

Current Position

Counterparties with offsetting positions or collateral

$

61.7

$

(167.3

)

$

37.1

$

9.2

$

(77.7

)

Counterparties without offsetting positions - assets

0.1

—

—

0.1

—

Counterparties without offsetting positions - liabilities

—

—

—

—

—

61.8

(167.3

)

37.1

9.3

(77.7

)

Long-Term Position

Counterparties with offsetting positions or collateral

24.2

(91.5

)

9.0

4.2

(62.5

)

Counterparties without offsetting positions - assets

1.1

—

—

1.1

—

Counterparties without offsetting positions - liabilities

—

(0.5

)

—

—

(0.5

)

25.3

(92.0

)

9.0

5.3

(63.0

)

Total Derivatives

Counterparties with offsetting positions or collateral

85.9

(258.8

)

46.1

13.4

(140.2

)

Counterparties without offsetting positions - assets

1.2

—

—

1.2

—

Counterparties without offsetting positions - liabilities

—

(0.5

)

—

—

(0.5

)

$

87.1

$

(259.3

)

$

46.1

$

14.6

$

(140.7

)

Some of our hedges are futures contracts executed through brokers that clear the hedges through an exchange. We maintain a margin deposit with the brokers in an amount sufficient to cover the fair value of our open futures positions. The margin deposit is considered collateral, which is included within Other current assets on our Consolidated Balance Sheets and is not offset against the fair value of our derivative instruments. Our derivative instruments other than our futures contracts are executed under International Swaps and Derivatives Association agreements (“ISDAs”), which govern the key terms with our counterparties. Our ISDAs contain credit-risk related contingent features and are not secured. As of December 31, 2025, we have outstanding net derivative positions that contain credit-risk related contingent features that are in a net liability position of $104.1 million. We have not been required to post any collateral related to these positions due to our credit rating. If our credit rating was to be downgraded one notch below investment grade by both Moody’s and S&P, as defined in our ISDAs, we estimate that as of December 31, 2025, we would not be required to post collateral to any counterparty and that no counterparty could request immediate, full settlement per the terms of our ISDAs.

F-35

The fair value of our derivative instruments, depending on the type of instrument, was determined by the use of present value methods or standard option valuation models with assumptions about commodity prices based on those observed in underlying markets. The estimated fair value of our derivative instruments was a net liability of $66.9 million as of December 31, 2025. The estimated fair value is net of an adjustment for credit risk based on the default probabilities as indicated by market quotes for our counterparties’ credit default swap rates. The credit risk adjustment was immaterial for all periods presented. Our futures contracts that are cleared through an exchange are margined daily and do not require any credit adjustment.

The following tables reflect amounts recorded in OCI and amounts reclassified from OCI to revenue for the periods presented:

Gain (Loss) Recognized in OCI on Derivatives (Effective Portion)

Derivatives in Cash Flow

Year Ended December 31,

Hedging Relationships

2025

2024

2023

Commodity contracts

$

202.8

$

(7.5

)

$

193.4

Gain (Loss) Reclassified from OCI into Income (Effective Portion)

Year Ended December 31,

Location of Gain (Loss)

2025

2024

2023

Revenues

$

90.9

$

67.8

$

153.4

As of December 31, 2025, we expect to reclassify commodity hedge related net deferred gains of $120.7 million included in Accumulated OCI into earnings before income taxes over the next twelve months. However, actual amounts reclassified into earnings could be greater or less than the net amount reported in Accumulated OCI. As of December 31, 2025, the maximum length of time over which we have hedged our exposure to the variability in future cash flows is through 2028.

Our consolidated earnings are also affected by the use of the mark-to-market method of accounting for derivative instruments that do not qualify for hedge accounting or that have not been designated as hedges. The changes in fair value of these instruments are recorded on our Consolidated Balance Sheets and through earnings in our Consolidated Statements of Operations rather than being deferred until the anticipated transaction settles. The use of mark-to-market accounting for financial assets and liabilities (“financial instruments”) can cause non-cash earnings volatility due to changes in the underlying commodity price indices. For the year ended December 31, 2025, we had unrealized mark-to-market losses primarily driven by unfavorable movement in natural gas forward basis prices.

Location of Gain (Loss)

Gain (Loss) Recognized in Income on Derivatives

Derivatives Not Designated

Recognized in Income on

Year Ended December 31,

as Hedging Instruments

Derivatives

2025

2024

2023

Commodity contracts

Revenue

$

(251.2

)

$

(313.2

)

$

287.7

See “Note 14 – Fair Value Measurements” and “Note 22 – Segment Information” for additional disclosures related to derivative instruments and hedging activities.

Note 14 — Fair Value Measurements

Under GAAP, our Consolidated Balance Sheets reflect a mixture of measurement methods for financial instruments. Derivative financial instruments are reported at fair value on our Consolidated Balance Sheets. Other financial instruments are reported at historical cost or amortized cost on our Consolidated Balance Sheets. The following are additional qualitative and quantitative disclosures regarding fair value measurements of our financial instruments.

Fair Value of Derivative Financial Instruments

Our derivative instruments consist of financially settled commodity swaps, futures, option contracts and fixed-price forward commodity contracts with certain counterparties. We determine the fair value of our derivative instruments using present value methods or standard option valuation models with assumptions about commodity prices based on those observed in underlying markets. We have consistently applied these valuation techniques in all periods presented and we believe we have obtained the most accurate information available for the types of derivative instruments we hold.

F-36

The fair values of our derivative instruments are sensitive to changes in forward pricing on natural gas, NGLs and crude oil. The derivatives at December 31, 2025 represent a net liability position of $66.9 million and reflects the present value, adjusted for counterparty credit risk, of the amount we expect to receive or pay in the future on our derivative instruments. If forward pricing on natural gas, NGLs and crude oil were to increase by 10%, the result would be a fair value reflecting a net liability of $235.6 million. If forward pricing on natural gas, NGLs and crude oil were to decrease by 10%, the result would be a fair value reflecting a net asset of $101.8 million.

Fair Value of Other Financial Instruments

Due to their cash or near-cash nature, the carrying value of other financial instruments included in working capital (i.e., cash and cash equivalents, accounts receivable, accounts payable) approximates their fair value. Debt is primarily the other financial instrument for which carrying value could vary significantly from fair value. We determined the supplemental fair value disclosures for our current and long-term debt as follows:

•
the TRGP Revolver, Commercial Paper Program and Securitization Facility are based on carrying value, which approximates fair value as their interest rates are based on prevailing market rates; and

•
the TRGP senior unsecured notes and the Partnership’s senior unsecured notes are based on quoted market prices derived from trades of the debt.

Contingent consideration liabilities related to business acquisitions are carried at fair value.

Fair Value Hierarchy

The following table shows a breakdown by fair value hierarchy category for (i) financial instruments measurements included on our Consolidated Balance Sheets at fair value and (ii) supplemental fair value disclosures for other financial instruments as of the periods presented:

December 31, 2025

Carrying

Fair Value

Value

Total

Level 1

Level 2

Level 3

Financial Instruments Recorded on Our

Consolidated Balance Sheets at Fair Value:

Assets from commodity derivative contracts (1)

$

189.3

$

189.3

$

—

$

189.2

$

0.1

Liabilities from commodity derivative contracts (1)

256.2

256.2

—

255.2

1.0

Contingent consideration (2)

0.3

0.3

—

—

0.3

Financial Instruments Recorded on Our

Consolidated Balance Sheets at Carrying Value:

Cash and cash equivalents

166.1

166.1

—

—

—

TRGP Revolver and Commercial Paper Program

161.0

161.0

—

161.0

—

TRGP Senior unsecured notes

12,711.7

12,928.6

—

12,928.6

—

Partnership’s Senior unsecured notes

4,329.2

4,316.2

—

4,316.2

—

December 31, 2024

Carrying

Fair Value

Value

Total

Level 1

Level 2

Level 3

Financial Instruments Recorded on Our

Consolidated Balance Sheets at Fair Value:

Assets from commodity derivative contracts (1)

$

87.0

$

87.0

$

—

$

87.0

$

—

Liabilities from commodity derivative contracts (1)

259.2

259.2

—

259.2

—

Financial Instruments Recorded on Our

Consolidated Balance Sheets at Carrying Value:

Cash and cash equivalents

157.3

157.3

—

—

—

Previous TRGP Revolver and Commercial Paper Program

1,130.5

1,130.5

—

1,130.5

—

TRGP Senior unsecured notes

7,470.6

7,438.6

—

7,438.6

—

Partnership’s Senior unsecured notes

5,034.4

4,928.0

—

4,928.0

—

Securitization Facility

330.0

330.0

—

330.0

—

(1)
The fair value of derivative contracts in this table is presented on a different basis than the Consolidated Balance Sheets presentation as disclosed in “Note 13 – Derivative Instruments and Hedging Activities”. The above fair values reflect the total value of each derivative contract taken as a whole, whereas the Consolidated Balance Sheets presentation is based on the individual maturity dates of estimated future settlements. As such, an individual contract could have both an asset and liability position when segregated into its current and long-term portions for Consolidated Balance Sheets classification purposes.

(2)
We have a contingent consideration liability related to the Dovetail Acquisition, which is carried at fair value. See “Note 4 - Acquisitions and Joint Ventures”.

F-37

Additional Information Regarding Level 3 Fair Value Measurements Included on Our Consolidated Balance Sheets

We report certain of our swaps at fair value using Level 3 inputs due to such derivative instruments not having observable market prices or implied volatilities for substantially the full term of the derivative asset or liability. For valuations that include both observable and unobservable inputs, if the unobservable input is determined to be significant to the overall inputs, the entire valuation is categorized in Level 3. This includes derivative instruments valued using indicative price quotations whose contract length extends into unobservable periods. The fair value of these swaps was determined using a discounted cash flow valuation technique based on a commodity forward curve, which is based on observable or public data sources and extrapolated when observable prices are not available. The significant unobservable inputs used in the fair value measurements of our Level 3 derivatives were the forward natural gas pricing inputs, for which a significant portion of the derivative instruments’ term is beyond available forward pricing.

The fair value of the Dovetail Acquisition contingent consideration was determined using a Monte Carlo simulation model. Significant inputs used in the fair value measurement include forecasted volumes, term of the earn-out period, risk-adjusted discount rate, and volatility associated with the underlying assets. The inputs are not observable; therefore, the entire valuation of the contingent consideration is categorized in Level 3. Subsequent changes in the fair value of this liability are included in Other income (expense) in our Consolidated Statements of Operations.

The following table summarizes the changes in fair value of our financial instruments classified as Level 3 in the fair value hierarchy for the period presented:

Commodity

Derivative Contracts

Contingent

Asset (Liability)

Consideration

Balance, December 31, 2024

—

—

Contingent consideration

—

(0.3

)

Unrealized gain(loss) included in OCI

(0.9

)

—

Balance, December 31, 2025

$

(0.9

)

$

(0.3

)

Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis

Nonfinancial assets and liabilities, such as long-lived assets, are measured at fair value on a nonrecurring basis at acquisition or whenever impairment indicators are present. For disclosures related to valuation techniques used in the Dovetail Acquisition, see “Note 4 – Acquisitions and Joint Ventures”.

The techniques used to fair value assets and liabilities on a nonrecurring basis may produce a fair value calculation that may not be indicative or reflective of future fair values. Furthermore, while we believe our valuation techniques are appropriate and consistent with other market participants, the use of different techniques or assumptions to determine fair value of certain financial and nonfinancial assets and liabilities could result in a different fair value measurement at the reporting date.

F-38

Note 15 — Related Party Transactions

Transactions with Unconsolidated Affiliates

The following table summarizes increases (decreases) for the line items presented below in our Consolidated Statements of Operations as a result of transactions with unconsolidated affiliates:

GCF

Cayenne

Little Missouri 4

Total

2025:

Revenue

$

9.8

$

—

$

—

$

9.8

Product purchases and fuel

14.7

6.9

12.2

33.8

Operating expenses

(10.9

)

(1.0

)

(2.0

)

(13.9

)

General and administrative expenses

—

—

(1.0

)

(1.0

)

2024:

Revenue

$

—

$

—

$

—

$

—

Product purchases and fuel

—

6.4

14.0

20.4

Operating expenses

(11.6

)

(0.9

)

(2.2

)

(14.7

)

General and administrative expenses

—

—

(0.9

)

(0.9

)

2023:

Revenue

$

—

$

—

$

—

$

—

Product purchases and fuel

—

6.4

8.1

14.5

Operating expenses

(5.6

)

(0.9

)

(2.2

)

(8.7

)

General and administrative expenses

—

—

(0.9

)

(0.9

)

Note 16 — Commitments

Future non-cancelable commitments comprise of operating and capital expenditures related to certain contractual obligations are presented below for each of the next five fiscal years and in aggregate thereafter as of December 31, 2025:

In Aggregate

2026

2027

2028

2029

2030

Thereafter

Land sites and rights of way (1)

$

374.3

$

11.8

$

13.2

$

18.6

$

9.4

$

8.5

$

312.8

(1)
Leases related to land sites and rights of way provide for surface and underground access for gathering, processing and distribution assets that are located on property not owned by us. These agreements expire at various dates, with varying terms, some of which are perpetual.

The following table shows total operating expenses incurred under the above non-cancelable commitments for the periods presented:

Year Ended December 31,

2025

2024

2023

Land sites and rights of way

$

6.8

$

7.2

$

9.0

Note 17 — Contingencies

Legal Proceedings

We and the Partnership are parties to various legal, administrative and regulatory proceedings that have arisen in the ordinary course of our business. We and the Partnership are also parties to various proceedings with governmental environmental agencies, including, but not limited to the U.S. Environmental Protection Agency (the “EPA”), Texas Commission on Environmental Quality, Oklahoma Department of Environmental Quality, New Mexico Environment Department, Louisiana Department of Environmental Quality and North Dakota Department of Environmental Quality, which assert monetary sanctions for alleged violations of environmental regulations, including air emissions, discharges into the environment and reporting deficiencies, related to events that have arisen at certain of our facilities in the ordinary course of our business.

F-39

On July 24, 2023, we received a Notice of Violation (the “New Mexico NOV”) from the New Mexico Environment Department (the “NMED”), Air Quality Bureau, relating to alleged air permit violations at the Red Hills gas processing facility. The alleged air permit violations occurred primarily between August 1, 2021 and June 30, 2022, while the facility was owned by Lucid Energy Delaware, LLC (“Lucid”), a subsidiary we acquired in July 2022 and renamed Targa Northern Delaware LLC. On December 5, 2024, we received a proposed Administrative Compliance Order (the “ACO”) from the NMED relating to the violations identified in the New Mexico NOV and certain other alleged violations. The ACO includes a proposed civil penalty of approximately $47.8 million and requires certain capital improvements to address the operations and excess air emissions at the Red Hills processing facility. These capital improvements, totaling approximately $140 million, were substantially completed by December 31, 2024.

On January 3, 2025, we filed a Request for Hearing with the NMED with respect to the ACO. We have cooperated with the NMED in identifying and correcting legacy environmental issues since our acquisition of Lucid, and we expect to continue to engage with the NMED to resolve this matter and certain additional matters identified during our negotiations with the NMED. Although this matter is ongoing and we cannot predict its ultimate outcome, we believe we have valid defenses to many of the NMED allegations and intend to vigorously defend this matter.

On October 26, 2023, we received a final judgment in a lawsuit alleging a breach of contract related to the major winter storm in February 2021. The damages awarded against us are approximately $6.9 million, not including pre-judgment interest. Both parties appealed the judgment. On December 9, 2025, the Fifth Circuit Court of Appeals (i) reversed the trial court’s summary judgment in favor of Targa and remanded the case to trial court for further proceedings and (ii) upheld the $6.9 million jury verdict in favor of MIECO. Targa has filed a motion for reconsideration, and the appeal remains pending at the Fifth Circuit Court of Appeals.

In April 2024, we received an administrative Notice of Violation (the “EPA NOV”) from the EPA and a request for the production of documents from the United States Attorney’s Office for North Dakota relating to alleged violations of the Clean Air Act (“CAA”), at certain Targa Badlands LLC compressor stations. The EPA NOV and subpoena stem from inspections the EPA conducted at the compressor stations on June 15, 2023, as well as related records reviews. In October 2024, we began negotiations with the U.S. Attorney’s Office with respect to resolution of a single-count information alleging a violation of the CAA related to untimely installation of monitoring equipment at one compressor station, which carries a maximum fine of $500,000, and we entered into a Plea Agreement on December 16, 2024 reflecting these terms. In July 2025, we entered into a Consent Agreement and Final Order with the EPA that resolves the allegations contained in the EPA NOV by requiring, among other things, payment of an administrative penalty in the amount of approximately $3.2 million. On December 5, 2025, Targa Badlands was sentenced under the Plea Agreement, which, among other things, imposed the maximum fine of $500,000.

Note 18 — Revenue

Fixed consideration allocated to remaining performance obligations

The following table presents the estimated minimum revenue related to unsatisfied performance obligations at the end of the reporting period, and is comprised of fixed consideration primarily attributable to contracts with minimum volume commitments, for which a guaranteed amount of revenue can be calculated. These contracts are comprised primarily of gathering and processing, fractionation, export, terminaling and storage agreements, with remaining contract terms ranging from 1 to 15 years.

2026

2027

2028 and after

Fixed consideration to be recognized as of December 31, 2025

$

371.6

$

397.0

$

1,773.8

Based on the optional exemptions that we elected to apply, the amounts presented in the table above exclude remaining performance obligations for (i) variable consideration for which the allocation exception is met and (ii) contracts with an original expected duration of one year or less.

Deferred Revenue

Deferred revenue as of December 31, 2025 and 2024 was $135.7 million and $119.9 million, respectively. Deferred revenue includes contributions in aid of construction received from customers related to owned property, plant, and equipment for which revenue is recognized over the expected contract term. Deferred revenue also includes consideration received in 2015 and 2017 amendments to a gas gathering and processing agreement. The deferred revenue related to these amendments is being recognized through the end of the agreement’s term in 2035.

For the years ended December 31, 2025, 2024 and 2023, we recognized revenue of $20.5 million, $19.6 million and $17.4 million, respectively, from prior period deferral.

F-40

The following table shows the components of deferred revenue as of the periods presented:

December 31, 2025

December 31, 2024

Contributions in aid of construction

$

110.9

$

91.1

Gas contract amendment

24.8

27.3

Other

—

1.5

Total deferred revenue

$

135.7

$

119.9

The following table shows the changes in deferred revenue for the periods presented:

Year Ended December 31,

2025

2024

Balance at beginning of period

$

119.9

$

248.8

Additions

36.3

19.7

Revenue recognized

(20.5

)

(19.6

)

Reclassification to accrued liabilities (1)

—

(129.0

)

Balance at end of period

$

135.7

$

119.9

(1) Represents amount reclassified from deferred revenue to Accrued liabilities in 2024 as a result of a legal ruling associated with an agreement, dated December 27, 2015, for crude oil and condensate between Targa Channelview LLC, then a subsidiary of the Company, and Noble Americas Corp. On April 26, 2024, we made a cash payment of $184.8 million which included cumulative interest of $55.8 million to Vitol in satisfaction of the legal ruling.

For additional information on our revenue recognition policy, see “Note 3 – Significant Accounting Policies”, and for disclosures related to disaggregated revenue, see “Note 22 – Segment Information”.

Note 19 — Income Taxes

The following table shows components of the federal and state income tax provisions for the periods presented:

Year Ended December 31,

2025

2024

2023

Current expense (benefit)

Federal

$

12.2

$

(0.1

)

$

0.2

State

0.9

17.6

13.4

Total current expense (benefit)

13.1

17.5

13.6

Deferred expense (benefit)

Federal

466.7

339.2

342.4

State

49.9

27.8

7.2

Total deferred expense (benefit)

516.6

367.0

349.6

Total income tax expense (benefit)

$

529.7

$

384.5

$

363.2

Our deferred income tax assets and liabilities as of the periods presented consist of recognition differences related to certain types of costs as follows:

December 31, 2025

December 31, 2024

Deferred tax assets:

Net operating loss and tax credit carryforwards

$

1,045.0

$

1,094.9

Disallowed business interest expense carryforward

22.1

113.5

Property, plant and equipment

1.5

1.9

Other

12.6

10.1

Deferred tax assets before valuation allowance

1,081.2

1,220.4

Valuation allowance

(5.9

)

(5.9

)

Deferred tax assets

1,075.3

1,214.5

Deferred tax liabilities:

Investments (1)

(2,468.8

)

(2,086.6

)

Deferred tax liabilities

(2,468.8

)

(2,086.6

)

Net deferred tax asset (liability)

$

(1,393.5

)

$

(872.1

)

Net deferred tax asset (liability)

Federal

$

(1,298.0

)

$

(826.7

)

State

(95.5

)

(45.4

)

Long-term deferred tax liability, net

$

(1,393.5

)

$

(872.1

)

(1)
Our deferred tax liability attributable to investments reflects the differences between the book and tax carrying values of our investment in the Partnership.

F-41

We are subject to tax in the U.S. and various state jurisdictions, and we are subject to periodic audits and reviews by taxing authorities. As of December 31, 2025, examinations by the Internal Revenue Service (“IRS”) are currently in process for the 2022 taxable year of certain wholly-owned and consolidated subsidiaries that are treated as partnerships for U.S. federal income tax purposes. We are responding to information requests from the IRS with respect to these audits. We do not expect there to be any audit adjustments that would materially change our taxable income.

Federal statutes of limitations for returns filed in 2022 (for calendar year 2021) have expired. The statute of limitations expired on substantially all 2021 state income tax returns that were filed prior to October 15, 2022. For Texas, the statute of limitations has expired for 2021 returns (for calendar year 2020). However, tax authorities could review and adjust carryover attributes (e.g., net operating losses (“NOLs”)) generated in a closed tax year if utilized in an open tax year.

As of December 31, 2025, we have total U.S. federal NOL carryforwards of $4.4 billion and tax credit carryforwards of $3.8 million. The NOL carryforwards do not expire, but are limited to offsetting 80% of taxable income per year. The tax credit carryforwards expire in 2044. As of December 31, 2025 and 2024, our tax effected valuation allowance was $5.9 million. Of this valuation allowance, $5.2 million is federal and the remaining $0.7 million is state.

The following table shows our income taxes paid net of refunds received for the periods presented:

Year Ended December 31,

2025

2024

2023

Income taxes paid, net of refunds:

Federal

$

7.1

$

—

$

(0.1

)

State:

Texas

14.3

11.6

8.9

New Mexico

1.3

1.3

—

California

(0.4

)

1.1

—

Arizona

0.2

1.0

—

Other

1.8

1.7

(0.3

)

Total State

17.2

16.7

8.6

Total income taxes paid, net of refunds

$

24.3

$

16.7

$

8.5

The following table shows the reconciliation between our Income tax provision (benefit) computed at the United States statutory rate on income before income taxes and the income tax provision (benefit) in our Consolidated Statements of Operations for the periods presented:

Year Ended December 31,

Income tax reconciliation:

2025

2024

2023

Income (loss) before income taxes

$

2,486.4

$

1,938.0

$

1,942.5

U.S. federal statutory tax rate

522.1

21.0

%

407.0

21.0

%

407.9

21.0

%

State and local income taxes, net of federal income tax effect (1)

40.2

1.6

%

35.9

1.9

%

16.3

0.8

%

Changes in valuation allowance

—

—

(1.2

)

(0.1

%)

—

—

Nontaxable or nondeductible items

Income attributable to noncontrolling interest

(7.1

)

(0.3

%)

(50.7

)

(2.6

%)

(49.0

)

(2.5

%)

Other

(12.7

)

(0.5

%)

(5.8

)

(0.3

%)

(9.5

)

(0.5

%)

Other adjustments

(12.8

)

(0.5

%)

(0.7

)

(0.1

%)

(2.5

)

(0.1

%)

Income tax provision (benefit)

$

529.7

21.3

%

$

384.5

19.8

%

$

363.2

18.7

%

(1)
State taxes in Texas and New Mexico made up the majority (greater than 50 percent) of the tax effect in this category.

We have not identified any uncertain tax positions. We believe that our income tax filing positions and deductions will be sustained on audit and do not anticipate any adjustments that will result in a material adverse effect on our financial condition, results of operations or cash flow. Therefore, no reserves for uncertain income tax positions have been recorded.

On July 4, 2025, President Trump signed the One Big Beautiful Bill Act (the “OBBBA”) into law. Among other things, the OBBBA indefinitely extends the 100% first-year depreciation allowance on qualified property placed in service after January 19, 2025, includes favorable modifications to the business interest expense limitation, and otherwise extends and enhances certain key provisions of the Tax Cuts & Jobs Act. The OBBBA has multiple effective dates with respect to its various provisions, with certain provisions effective in 2025. The impacts of OBBBA are reflected in our results for the year, and there was no material impact to our effective tax rate. We expect certain provisions may change the timing of cash tax payments in future periods.

F-42

The U.S. Department of the Treasury and the IRS have issued guidance on the application of the corporate alternative minimum tax (the “CAMT”), which is a 15% minimum tax imposed on certain financial income of “applicable corporations,” including proposed regulations issued in September 2024, which may be relied upon until final regulations are released. Based on our interpretation of the Inflation Reduction Act of 2022 (the “IRA”), the CAMT and related guidance, the impact from the OBBBA, and several operational, economic, accounting and regulatory assumptions, we do not anticipate paying CAMT in the near term.

Note 20 — Supplemental Cash Flow Information

Year Ended December 31,

2025

2024

2023

Cash:

Interest paid, net of capitalized interest (1)

$

793.3

$

712.7

$

618.6

Non-cash investing activities:

Change in deadstock commodity inventory

$

(5.5

)

$

3.7

$

(13.7

)

Impact of net accruals on capital expenditures

108.4

221.7

58.2

Change in ARO liability and property, plant and equipment, net due to revised cash flow estimate and additions

4.0

64.1

4.9

Contingent consideration

0.3

—

—

Non-cash financing activities:

Changes in accrued distributions to noncontrolling interests

$

(13.5

)

$

(3.6

)

$

8.9

Reduction of owner's equity related to accrued dividends on unvested equity awards under share compensation arrangements

3.5

3.8

3.9

Changes in lease liabilities from recognition (derecognition) of right-of-use assets:

Operating lease

$

15.3

$

66.8

$

53.1

Finance lease

127.3

59.8

104.8

(1)
Interest capitalized on major projects was $77.3 million, $74.8 million and $41.1 million for the years ended December 31, 2025, 2024 and 2023.

Note 21 — Compensation Plans

2010 Targa Resources Corp. Stock Incentive Plan

In December 2010, we adopted the Targa Resources Corp. 2010 Stock Incentive Plan (the “2010 TRGP Plan”) for employees, consultants and non-employee directors of the Company. In May 2017, the 2010 TRGP Plan was amended and restated. In August 2023, the 2010 TRGP Plan was amended and restated for a second time. Total authorized shares of common stock under the plan is 15,000,000, comprised of 5,000,000 shares originally available and an additional 10,000,000 shares that became available in May 2017. The 2010 TRGP Plan allows for the grant of (i) incentive stock options qualified as such under U.S. federal income tax laws (“Incentive Options”), (ii) stock options that do not qualify as Incentive Options (“Non-statutory Options,” and together with Incentive Options, “Options”), (iii) stock appreciation rights granted in conjunction with Options or Phantom Stock Awards, (iv) restricted stock awards, (v) phantom stock awards, (vi) bonus stock awards, (vii) performance unit awards, or (viii) any combination of such awards.

Unless otherwise specified, the compensation costs for the awards listed below were recognized as expense over related vesting periods based on the grant-date fair values, reduced by forfeitures incurred.

Restricted Stock Awards – Restricted stock entitles the recipient to cash dividends. Dividends on unvested restricted stock will be accrued when declared and recorded as short-term or long-term liabilities, dependent on the time remaining until payment of the dividends, and paid in cash when the award vests. Upon issuance, the restricted stock awards will be included in the outstanding shares of our common stock. The Compensation Committee of the Targa board of directors (the “Compensation Committee”) awarded our common stock to our outside directors. In 2025, 2024 and 2023, we issued 9,479, 23,984 and 23,518 shares of director grants with weighted average grant-date fair values of $209.18, $85.70 and $74.13, respectively.

Restricted Stock Units Awards – RSUs are similar to restricted stock, except that shares of common stock are not issued until the RSUs vest. The vesting periods generally vary from one to six years. In March 2023, the Compensation Committee amended the Restricted Stock Units Grant Agreements that govern the RSUs that vest no later than three years following the RSUs’ grant date. The amendment resulted in quarterly cash dividend payments to RSU holders beginning with the common stock dividend paid in May 2023. In 2025, 2024 and 2023, we issued 348,443, 415,467 and 587,326 shares of RSUs with weighted average grant-date fair values of $173.24, $117.95 and $78.69, respectively.

F-43

The following table shows activity related to the restricted stock awards and RSUs under the 2010 TRGP Plan for the period presented:

Number

of shares

Weighted Average

Grant-Date Fair Value

Outstanding at December 31, 2024

1,770,052

$

79.96

Granted

357,922

174.19

Forfeited

(55,365

)

104.84

Vested

(631,162

)

65.84

Outstanding at December 31, 2025

1,441,447

108.67

Performance Share Units

During 2025, 2024 and 2023, we granted 77,114, 131,816 and 140,020 performance share units (“PSUs”) to executive management for the 2025, 2024 and 2023 compensation cycles that will vest/have vested in January 2028, January 2027 and January 2026. The PSUs granted under the 2010 TRGP Plan are three-year equity-settled awards linked to the performance of shares of our common stock. The awards also include dividend equivalent rights (“DERs”) that are based on the notional dividends accumulated during the vesting period.

The vesting of the PSUs is dependent on the satisfaction of a combination of certain service-related conditions and the Company’s total shareholder return (“TSR”) relative to the TSR of the members of a specified comparator group of publicly-traded midstream companies (the “LTIP Peer Group”) measured over designated periods. For the PSUs granted in 2023, 2024 and 2025, the TSR performance factor is determined by the Compensation Committee based on relative TSR over a cumulative three-year performance period. The Compensation Committee determines a guideline performance percentage for the performance period and the percentage may then be decreased or increased by the Compensation Committee at its discretion. The grantee will become vested in a number of PSUs equal to the target number awarded multiplied by the TSR performance factor, and vested PSUs will be settled by the issuance of Company common stock. The value of DERs will be paid in cash when the awards vest.

Compensation cost for equity-settled PSUs was recognized as an expense over the performance period based on fair value at the grant date. The compensation cost will be reduced if forfeitures occur. Fair value was calculated using a simulated share price that incorporates peer ranking. DERs associated with equity-settled PSUs were accrued over the performance period as a reduction of owners’ equity. We evaluated the grant date fair value using a Monte Carlo simulation model and historical volatility assumption with an expected term of three years. The expected volatilities were 32%, 34% and 38% for PSUs granted in 2025, 2024 and 2023.

The following table shows activity related to the PSUs under the 2010 TRGP Plan for the period presented:

Number

of shares

Weighted Average

Grant-Date Fair Value

Outstanding at December 31, 2024

413,094

$

126.99

Granted

77,114

377.30

Vested

(155,790

)

108.55

Outstanding at December 31, 2025

334,418

193.30

Stock Compensation Expense

Stock compensation expense under our plans totaled $69.5 million, $63.2 million and $62.4 million for the years ended December 31, 2025, 2024 and 2023, respectively. As of December 31, 2025, we have $105.2 million of unrecognized compensation expense associated with share-based awards and an approximate remaining weighted average vesting period of 2.3 years related to our various compensation plans.

The fair values of share-based awards vested in 2025, 2024 and 2023 were $83.8 million, $87.2 million and $96.8 million, respectively. Cash dividends paid for the vested awards were $3.2 million, $5.3 million and $8.3 million for the years ended December 31, 2025, 2024 and 2023, respectively.

In relation to our equity compensation plans, we recognized $13.9 million, $14.2 million and $17.0 million in windfall tax benefits for the years ended December 31, 2025, 2024 and 2023, respectively.

F-44

Subsequent Events

In January 2026, the Compensation Committee made the following awards under the 2010 TRGP Plan:

•
10,829 shares of restricted stock to our outside directors that will vest in January 2027;

•
92,281 shares of RSUs to executive management for the 2026 compensation cycle that will vest in January 2029; and

•
92,281 shares of PSUs to executive management for the 2026 compensation cycle that will vest in January 2029.

In January 2026, the following shares vested:

•
9,479 shares of director grants with no shares withheld to satisfy tax withholding obligations;

•
130,113 shares of RSUs with 51,815 shares withheld to satisfy tax withholding obligations; and

•
325,284 shares of 2023 PSUs with 124,769 shares withheld to satisfy tax withholding obligations.

Targa 401(k) Plan

We have a 401(k) plan whereby we match 100% of up to 5% of an employee’s contribution (subject to certain limitations in the plan). We also contribute an amount equal to 3% of each employee’s eligible compensation to the plan as a retirement contribution and may make additional contributions at our sole discretion. All Targa contributions are made 100% in cash. We made contributions to the 401(k) plan totaling $39.8 million, $35.1 million and $32.3 million during the years ended December 31, 2025, 2024 and 2023, respectively.

Note 22 — Segment Information

We operate in two primary segments: (i) Gathering and Processing, and (ii) Logistics and Transportation (also referred to as the Downstream Business). Our reportable segments include operating segments that have been aggregated based on the nature of the products and services provided.

Our Gathering and Processing segment includes assets used in the gathering and/or purchase and sale of natural gas produced from oil and gas wells, removing impurities and processing this raw natural gas into merchantable natural gas by extracting NGLs; and assets used for the gathering and terminaling and/or purchase and sale of crude oil. The Gathering and Processing segment’s assets are located in the Permian Basin of West Texas and Southeast New Mexico (including the Midland, Central and Delaware Basins); the Eagle Ford Shale in South Texas; the Barnett Shale in North Texas; the Anadarko, Ardmore, and Arkoma Basins in Oklahoma (including the SCOOP and STACK) and South Central Kansas; the Williston Basin in North Dakota (including the Bakken and Three Forks plays); and the onshore and near offshore regions of the Louisiana Gulf Coast.

Our Logistics and Transportation segment includes the activities and assets necessary to convert mixed NGLs into NGL products and also includes other assets and value-added services such as transporting, storing, fractionating, terminaling, and marketing of NGLs and NGL products, including services to LPG exporters and certain natural gas supply and marketing activities in support of our other businesses. The Logistics and Transportation segment also includes our NGL pipeline system, which connects our gathering and processing positions in the Permian Basin, Southern Oklahoma and North Texas with our Downstream facilities in Mont Belvieu, Texas. Our Downstream facilities are located predominantly in Mont Belvieu and Galena Park, Texas, and in Lake Charles, Louisiana.

Other contains the unrealized mark-to-market gains/losses related to derivative contracts that were not designated as cash flow hedges. Elimination of inter-segment transactions are reflected in the corporate and eliminations column.

The Company’s chief operating decision maker (“CODM”) is the Chief Executive Officer. The Company’s CODM assesses the segments’ performance by using each segment’s operating margin. The CODM uses segment operating margin for the annual budget and forecasting process and to make informed decisions about the allocation of resources.

F-45

The following tables show reportable segment information for the periods presented:

Year Ended December 31, 2025

Gathering and Processing

Logistics and Transportation

Total Reportable Segments

Other

Corporate

and

Eliminations

Total

Revenues

Sales of commodities

$

873.0

$

13,535.8

$

14,408.8

$

(5.3

)

$

—

$

14,403.5

Fees from midstream services

1,819.6

805.2

2,624.8

—

—

2,624.8

2,692.6

14,341.0

17,033.6

(5.3

)

—

17,028.3

Intersegment revenues

Sales of commodities

4,722.8

191.6

4,914.4

—

(4,914.4

)

—

Fees from midstream services

1.0

31.4

32.4

—

(32.4

)

—

4,723.8

223.0

4,946.8

—

(4,946.8

)

—

Revenues

$

7,416.4

$

14,564.0

$

21,980.4

$

(5.3

)

$

(4,946.8

)

$

17,028.3

Operating expenses

$

907.0

$

393.7

$

1,300.7

$

—

Other segment items (1)

4,070.2

11,382.0

15,452.2

—

Operating margin

2,439.2

2,788.3

5,227.5

(5.3

)

Other financial information:

Total assets (2)

$

14,805.4

$

10,105.1

$

24,910.5

$

1.8

$

306.1

$

25,218.4

Goodwill

112.3

—

112.3

—

—

112.3

Capital expenditures

2,046.1

1,372.2

3,418.3

—

23.0

3,441.3

Year Ended December 31, 2024

Gathering and Processing

Logistics and Transportation

Total Reportable Segments

Other

Corporate

and

Eliminations

Total

Revenues

Sales of commodities

$

1,032.8

$

13,023.6

$

14,056.4

$

(164.6

)

$

—

$

13,891.8

Fees from midstream services

1,656.7

833.0

2,489.7

—

—

2,489.7

2,689.5

13,856.6

16,546.1

(164.6

)

—

16,381.5

Intersegment revenues

Sales of commodities

4,118.5

146.1

4,264.6

—

(4,264.6

)

—

Fees from midstream services

0.4

27.7

28.1

—

(28.1

)

—

4,118.9

173.8

4,292.7

—

(4,292.7

)

—

Revenues

$

6,808.4

$

14,030.4

$

20,838.8

$

(164.6

)

$

(4,292.7

)

$

16,381.5

Operating expenses

$

814.6

$

362.3

$

1,176.9

$

—

Other segment items (1)

3,681.4

11,313.0

14,994.4

—

Operating margin

2,312.4

2,355.1

4,667.5

(164.6

)

Other financial information:

Total assets (2)

$

13,576.6

$

8,921.6

$

22,498.2

$

1.9

$

234.0

$

22,734.1

Goodwill

45.2

—

45.2

—

—

45.2

Capital expenditures

1,955.3

1,216.6

3,171.9

—

19.9

3,191.8

Year Ended December 31, 2023

Gathering and Processing

Logistics and Transportation

Total Reportable Segments

Other

Corporate

and

Eliminations

Total

Revenues

Sales of commodities

$

1,076.1

$

12,610.5

$

13,686.6

$

275.5

$

—

$

13,962.1

Fees from midstream services

1,366.5

731.7

2,098.2

—

—

2,098.2

2,442.6

13,342.2

15,784.8

275.5

—

16,060.3

Intersegment revenues

Sales of commodities

4,786.3

267.9

5,054.2

—

(5,054.2

)

—

Fees from midstream services

2.6

45.7

48.3

—

(48.3

)

—

4,788.9

313.6

5,102.5

—

(5,102.5

)

—

Revenues

$

7,231.5

$

13,655.8

$

20,887.3

$

275.5

$

(5,102.5

)

$

16,060.3

Operating expenses

$

746.6

$

332.0

$

1,078.6

$

—

Other segment items (1)

4,402.7

11,375.1

15,777.8

—

Operating margin

2,082.2

1,948.7

4,030.9

275.5

Other financial information:

Total assets (2)

$

12,685.2

$

7,777.8

$

20,463.0

$

4.2

$

204.6

$

20,671.8

Goodwill

45.2

—

45.2

—

—

45.2

Capital expenditures

1,514.7

910.0

2,424.7

—

18.9

2,443.6

(1)
“Other segment items” represents Product purchases and fuel.

(2)
Assets in the Corporate and Eliminations column primarily include tax-related assets, cash, prepaids and debt issuance costs for our revolving credit facilities.

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The following table shows our consolidated revenues disaggregated by product and service for the periods presented:

Year Ended December 31,

2025

2024

2023

Sales of commodities:

Revenue recognized from contracts with customers:

Natural gas

$

2,035.7

$

1,241.1

$

2,421.3

NGL

12,079.8

12,372.5

10,580.2

Condensate and crude oil

448.3

523.6

519.5

14,563.8

14,137.2

13,521.0

Non-customer revenue:

Derivative activities - Hedge

90.9

67.8

153.4

Derivative activities - Non-hedge (1)

(251.2

)

(313.2

)

287.7

(160.3

)

(245.4

)

441.1

Total sales of commodities

14,403.5

13,891.8

13,962.1

Fees from midstream services:

Revenue recognized from contracts with customers:

Gathering and processing

1,793.2

1,632.8

1,342.8

NGL transportation, fractionation and services

311.6

298.4

261.1

Storage, terminaling and export

496.8

497.9

440.7

Other

23.2

60.6

53.6

Total fees from midstream services

2,624.8

2,489.7

2,098.2

Total revenues

$

17,028.3

$

16,381.5

$

16,060.3

(1)
Represents derivative activities that are not designated as hedging instruments under ASC 815.

The following table shows a reconciliation of reportable segment Operating margin to Income (loss) before income taxes for the periods presented:

Year Ended December 31,

2025

2024

2023

Reconciliation of reportable segment operating

margin to income (loss) before income taxes:

Total reportable segments operating margin

$

5,227.5

$

4,667.5

$

4,030.9

Other operating margin

(5.3

)

(164.6

)

275.5

Depreciation and amortization expense

(1,515.3

)

(1,423.0

)

(1,329.6

)

General and administrative expense

(406.0

)

(384.9

)

(348.7

)

Other operating income (expense)

30.3

0.4

(1.5

)

Interest expense, net

(852.8

)

(767.2

)

(687.8

)

Equity earnings (loss)

11.8

9.4

9.0

Other, net

(3.8

)

0.4

(5.3

)

Income (loss) before income taxes

$

2,486.4

$

1,938.0

$

1,942.5

F-47