Targa Resources (TRGP) 10-K risk factor changes: FY2021 vs FY2021

[removed: Summary] [added: Summary] Risk [removed: Factors][added: Factors]

[removed: Risks] [added: *Risks] Related to our Results of [removed: Operations][added: Operations*]

[removed: | | • | Our] [added: *Our] cash flow is affected by supply and demand for natural gas, NGL products and crude oil and by natural gas, NGL, crude oil and condensate prices, and decreases in commodity prices and/or activity levels could adversely affect our results of operations and financial [removed: condition. |][added: condition.*]

[removed: | | • |] The widespread outbreak of pandemics (like COVID-19) or any other public health crisis that impacts the global demand for energy commodities may have material adverse effects on our business, financial position, results of operations and/or cash flows. [removed: |]

[removed: | | • | A] [added: *A] reduction in demand for NGL products by the petrochemical, refinery or other industries or by the fuel or export markets, or a significant increase in NGL product supply relative to this demand, could materially adversely affect our business, results of operations and financial [removed: condition. |][added: condition.*]

[removed: | | • | The] [added: *The] natural decline in production in our operating regions and in other regions from which we source NGL supplies means our long-term success depends on our ability to obtain new sources of supplies of natural gas, NGLs and crude oil, which depends on certain factors beyond our control. [removed: Any decrease in supplies of natural gas, NGLs or crude oil could adversely affect our business and operating results. |]

[removed: | | • | Our] [added: *Our] industry is highly competitive and increased competitive pressure could adversely affect our business and operating [removed: results. |][added: results.*]

[removed: | | • | We] [added: *We] operate in areas of high industry activity, which may affect our ability to hire, train or retain qualified personnel needed to manage and operate our [removed: business. |][added: business.*]

[removed: | | • | If] [added: *If] third-party pipelines and other facilities interconnected to our natural gas and crude oil gathering systems, terminals and processing facilities become partially or fully unavailable to transport natural gas, NGLs and crude oil, our revenues could be adversely [removed: affected. |][added: affected.*]

[removed: | | • | We] [added: *We] typically do not obtain independent evaluations of natural gas or crude oil reserves dedicated to our gathering pipeline systems; therefore, volumes on our systems in the future could be less than we [removed: anticipate. |][added: anticipate.*]

[removed: | | • | We] [added: *We] do not own most of the land on which our pipelines, terminals and compression facilities are located, which could disrupt our [removed: operations. |][added: operations.*]

[removed: | | • | If] [added: *If] we lose any of our named executive officers, our business may be adversely [removed: affected. |][added: affected.*]

[removed: | | • |] Climatic events may damage our pipelines and other facilities, limit our ability [added: or increase the costs] to operate our business and adversely impact our customers on whom we rely on for throughput as well as third party vendors from whom we receive goods, which developments could cause us to incur significant costs and adversely affect our business, results of operations and financial condition. [removed: |]

[removed: | | • | Our business involves many hazards and operational risks, some of which may not be insured or fully covered by insurance.] If a significant accident or event occurs for which we are not fully insured, if we fail to recover all anticipated insurance proceeds for significant accidents or events for which we are insured, or if we fail to rebuild facilities damaged by such accidents or events, our operations and financial results could be adversely [removed: affected. |][added: affected.*]

[removed: | | • | Unexpected] [added: *Unexpected] volume changes due to production variability or to gathering, plant or pipeline system disruptions may increase our exposure to commodity price [removed: movements. |][added: movements.*]

[removed: | | • | Portions] [added: *Portions] of our pipeline systems may require increased expenditures for maintenance and repair owing to the age of some of our systems, which expenditures or resulting loss of revenue due to pipeline age or condition could have a material adverse effect on our business and results of [removed: operations. |][added: operations.*]

[removed: | | • | We] [added: *We] face opposition to operation and expansion of our pipelines and facilities from various individuals and [removed: groups. |][added: groups.*]

[removed: | | • | We] [added: *We] may incur significant costs and liabilities resulting from performance of pipeline integrity testing programs and related [removed: repairs. |][added: repairs.*]

[removed: Risks] [added: *Risks] Related to our Capital Projects and Future [removed: Growth][added: Growth*]

[removed: | | • | Our] [added: *Our] expansion or modification of existing assets or the construction of new assets may not result in revenue increases and are subject to regulatory, environmental, political, legal and economic risks, which could adversely affect our results of operations and financial [removed: condition. |][added: condition.*]

[removed: | | • | If] [added: *If] we do not develop growth projects and/or make acquisitions for expanding existing assets or constructing new assets on economically acceptable terms, or fail to efficiently and effectively integrate developed or acquired assets with our asset base, our future growth will be limited. [removed: In addition, any acquisitions we complete are subject to substantial risks that could adversely affect our financial condition and results of operations and reduce our ability to pay dividends to stockholders. In addition, we may not achieve the expected results of any acquisitions and any adverse conditions or developments related to such acquisitions may have a negative impact on our operations and financial condition. |]

[removed: | | • |] We may be unable to cause our joint ventures to take or not to take certain actions unless some or all of our joint venture participants agree and certain of our joint venture partners may fail or refuse to fund their respective portions of capital projects that we believe are necessary to expand or maintain such joint venture’s business. [removed: |]

[removed: Risks] [added: *Risks] Related to our Financial [removed: Condition][added: Condition*]

[removed: | | • | If] [added: *If] we fail to maintain an effective system of internal controls, we may not be able to accurately report our financial results or prevent fraud. [removed: In addition, potential changes in accounting standards might cause us to revise our financial results and disclosure in the future. |]

[removed: | | • | We] [added: *We] are exposed to credit risks of our customers, and any material nonpayment or nonperformance by our key customers could adversely affect our cash flow and results of [removed: operations. |][added: operations.*]

[removed: | | • | Changes] [added: *Changes] in future business conditions could have a negative impact on the demand for our services and could cause recorded long-lived assets to become further impaired, and our financial condition and results of operations could suffer if there is a negative impact on the demand for our services and an additional impairment of long-lived [removed: assets. |][added: assets.*]

[removed: | | • | Our] [added: *Our] hedging activities may not be effective in reducing the variability of our cash flows and may, in certain circumstances, increase the variability of our cash flows. [removed: Moreover, our hedges may not fully protect us against volatility in basis differentials. Finally, the percentage of our expected equity commodity volumes that are hedged decreases substantially over time. |]

[removed: | | • | If] [added: *If] we fail to balance our purchases and sales of the commodities we handle, our exposure to commodity price risk will [removed: increase. |][added: increase.*]

[removed: | | • | The] [added: *The] amounts we pay in dividends may vary from anticipated amounts and circumstances may arise that lead to conflicts between using funds to pay anticipated dividends or to invest in our [removed: business. |][added: business.*]

[removed: | | • | If] [added: *If] dividends on our shares of common stock are not paid with respect to any fiscal quarter, our stockholders will not be entitled to receive that quarter’s payments in the [removed: future. |][added: future.*]

[removed: | | • |] Our future tax liability may be greater than expected if our NOL carryforwards are limited, we do not generate expected deductions, or tax authorities [added: successfully] challenge certain of our tax positions. [removed: |]

[removed: Risks] [added: *Risks] Related to the Ownership of our Common [removed: Stock][added: Stock*]

[removed: | | • | Future] [added: *Future] sales of our common stock in the public market could lower our stock price, and any additional capital raised by us through the sale of equity or convertible securities may dilute your ownership in [removed: us. |][added: us.*]

[removed: Risks] [added: *Risks] Related to our [removed: Indebtedness][added: Indebtedness*]

[removed: | | • | Increases] [added: Continued increases] in interest [removed: rates] [added: rates, due to associated Federal Reserve policies or otherwise,] could adversely affect our cost of capital, which could increase our funding costs and reduce the overall profitability of our business. [removed: |]

[removed: | | • | We] [added: *We] have a substantial amount of indebtedness which may adversely affect our financial position and we may still be able to incur substantially more debt, which could collectively increase the risks associated with compliance with our financial [removed: covenants. |][added: covenants.*]

[removed: | | • | The] [added: *The] terms of our debt agreements may restrict our current and future operations, particularly our ability to respond to changes in business or to take certain actions, including to pay dividends to our [removed: stockholders. |][added: stockholders.*]

[removed: Risks] [added: *Risks] Related to Regulatory [removed: Matters][added: Matters*]

[removed: | | • | Our] [added: *Our] and our customers’ operations are subject to a number of risks arising out of the threat of climate change that could result in increased operating costs, limit the areas in which oil and natural gas production may occur, and reduce demand for the products and services we [removed: provide. |][added: provide.*]

[removed: | | • |] Increasing [added: stakeholder and market] attention to ESG matters may impact our business. [removed: |]

Continuing or worsening inflationary issues and associated changes in monetary policy have resulted in and may result in additional increases to the cost of our goods, services and personnel, which in turn cause our capital expenditures and operating costs to rise.

Changes in tax laws or the interpretation thereof or the imposition of new or increased taxes may adversely affect our financial condition, results of operations and cash flows.

We may issue preferred stock whose terms could adversely affect the voting power or value of our common stock.

the impact of seasonality and weather, including severe weather conditions and other natural disasters, such as flooding, droughts and winter storms, the frequency, severity and impact of which could be increased by the effects of climate change;

the impact of energy conservation efforts and the related transition to a low carbon economy, as a result of the IRA or otherwise;

differences, mild winter weather for some NGL applications or other reasons, could result in a decline in the volume of NGL products we handle or reduce the fees we charge for our services.

*Ethane*.

*Propane*.

fuel, and in agricultural applications such as crop drying.

*Normal Butane*.

*Natural Gasoline*.

Any decrease in supplies of natural gas, NGLs or crude oil could adversely affect our business and operating results.*

Consequently, even if new natural gas or crude

For example, following Texas Governor Greg Abbott's direction to adopt rules related to weather resiliency, in August 2022, the Texas Railroad Commission adopted the Weather Emergency Preparedness Standards rule, which requires critical gas facilities on the state’s Electricity Supply Chain Map (including gas pipelines that directly serve electricity generation) to (i) weatherize to help ensure sustained operations during a weather emergency, (ii) correct known issues that caused weather-related forced stoppages and (iii) contact the Texas Railroad Commission if a facility sustains a weather-related forced stoppage during a weather emergency.

Inspectors from the Critical Infrastructure Division of the Texas Railroad Commission began inspections on December 1, 2022.

If, upon inspection,

we are required to further weatherize or update weatherization of certain facilities, we may incur significant costs to complete any additional weatherization.

Additionally, issues beyond our control, such as grid reliability or the severity of any such weather event, might undermine any winterization or emergency weather preparedness efforts we make.

Furthermore, our operations in western Texas and New Mexico may be sensitive to drought and restrictions on water use.

*Our business involves many hazards and operational risks, some of which may not be insured or fully covered by insurance.

*Terrorist attacks and the threat of terrorist attacks have resulted in increased costs to our business.

Continued global and domestic hostilities may adversely impact our results of operations.*

Similar actions pursued against our oil and gas customers could result in interruptions or limitations to their businesses, which could reduce demand for our services.

Increased regulatory attention to environmental justice matters at the federal and state level may also provide communities opposed to our operations with greater opportunities to challenge or delay the permitting approval process.

In August 2022, PHMSA finalized additional pipeline safety rules, which adjusted the repair criteria for pipelines in HCAs, created new criteria for pipelines in non-HCAs, and strengthened integrity management assessment requirements, among other items.

*We are subject to cybersecurity risks.

A cyber incident could occur and result in information theft, data corruption, operational disruption and/or financial loss.*

In May 2021, a ransomware attack on a major U.S. refined products pipeline forced the operator to temporarily shut down the pipeline, resulting in disruption of fuel supplies along the East Coast.

The effects of the COVID-19 pandemic, including travel bans, prohibitions on group events and gatherings, shutdowns of certain businesses, curfews, shelter-in-place orders and recommendations to practice social distancing in addition to other actions taken by both businesses and governments, resulted in a significant and swift reduction in international and U.S. economic activity.

Since the beginning of 2021, the distribution of COVID-19 vaccines progressed and many government-imposed restrictions were relaxed or rescinded.

However, we continue to monitor the effects of the pandemic on our operations.

Our results of operations and financial condition have been and may continue to be adversely affected by the COVID-19 pandemic.

The extent to which our operating and financial results are affected by COVID-19 will depend on various factors and consequences beyond our control, such as the emergence of more contagious and harmful variants of the COVID-19 virus, the duration and scope of the pandemic, additional actions by businesses and governments in response to the pandemic, and the speed and effectiveness of responses to combat the virus.

COVID-19, and the volatile regional and global economic conditions stemming from the pandemic, could also aggravate the other risk factors that we identify herein.

While the effects of the COVID-19 pandemic have lessened recently in the United States, we cannot predict the duration or future effects of the pandemic, or more contagious and harmful variants of the COVID-19 virus, and such effects may materially adversely affect our results of operations and financial condition in a manner that is not currently known to us or that we do not currently consider to present significant risks to our operations.

Risks Related to our Capital Projects and Future Growth

In addition, any acquisitions we complete are subject to substantial risks that could adversely affect our financial condition and results of operations and reduce our ability to pay dividends to stockholders.

In addition, we may not achieve the expected results of any acquisitions and any adverse conditions or developments related to such acquisitions may have a negative impact on our operations and financial condition.*

Risks Related to our Financial Condition

In addition, potential changes in accounting standards might cause us to revise our financial results and disclosure in the future.*

| --- | --- | --- |

| | • | Terrorist attacks and the threat of terrorist attacks have resulted in increased costs to our business. Continued hostilities in the Middle East, other sustained military campaigns and civil unrest in the United States may adversely impact our results of operations. |

| | • | Our growth and acquisition strategy requires access to new capital. Tightened capital markets or increased competition for investment opportunities could impair our ability to grow through growth projects or acquisitions. |

| | • | Our Series A Preferred Stock (“Series A Preferred”) gives the holders thereof liquidation and distribution preferences, certain rights relating to our business and management, and the ability to convert such shares into our common stock, potentially causing dilution to our common stockholders. |

| | • | the impact of seasonality and weather; |

| | • | the impact of energy conservation efforts; |

For example, the global spread of COVID-19 has caused business disruption, including disruption to the oil and gas industry.

The COVID-19 pandemic has negatively impacted the global economy, disrupted global supply chains, reduced global demand for oil and gas, and created significant volatility and disruption of financial and commodity markets.

The full extent of the impact of the COVID-19 pandemic on our operational and financial performance, including our ability to execute our business strategies and initiatives in the expected time frame, is uncertain and depends on various factors, including the demand for natural gas, NGLs and crude oil (including the impact that reductions in travel, manufacturing and consumer product demand have had and will have on the demand for energy commodities), the availability of personnel, equipment and services critical to our ability to operate our assets and the impact of potential governmental restrictions on travel, transportation and operations.

The degree to which the COVID-19 pandemic or any other public health crisis adversely impacts our results will also depend on future developments, which are highly uncertain and cannot be predicted.

These developments include, but are not limited to, the duration and spread of the outbreak, its severity, the actions to contain the virus or treat its impact, its impact on the economy and market conditions, and how quickly and to what extent normal economic and operating conditions can resume.

Therefore, while we expect this matter will continue to disrupt our operations in some way, the degree of the adverse financial impact cannot be reasonably estimated at this time.

Ethane.

Propane.

Normal Butane.

Isobutane.

Natural Gasoline.

In addition, local governments and landowners have filed lawsuits in recent years in Louisiana against energy companies, alleging that their operations contributed to increased coastal rising seas and erosion and seeking substantial damages.

For example, in June 2021, Texas Governor Greg Abbott signed Senate Bill 3 into law, requiring power facilities including natural gas pipeline facilities to weatherize against extreme weather.

The legislation, which is in response to Winter Storm Uri that caused widespread power outages in Texas in February 2021, directs the Texas Railroad Commission to adopt rules that will require a gas pipeline facility operator that experiences repeated or major weather-related forced interruptions of service to, among other things, engage an independent party to assess the operator’s weatherization plans, procedures and operations, and submit the assessment to the Texas Railroad Commission.

The Texas Railroad Commission has begun developing a process for designation of critical gas suppliers and exclusions from such designation, and further plans consideration and adoption of weatherization rules for certain facilities subject to its jurisdiction.

Depending on the outcome of the Texas Railroad Commission proceedings and designations, we could be required to weatherize or update weatherization of certain facilities in anticipation of, or in response to performance of such assessments, potentially resulting in our incurring significant costs.

Additionally, recent acts of protest and civil unrest have caused economic and political disruption in the United States.

In addition, destructive forms of protest or opposition by activists, including acts of sabotage or eco terrorism could cause significant damage or injury to people, property or the environment or lead to extended interruptions of our operations.

The HCAs for natural gas pipelines are predicated on high-population areas (which, for natural gas transmission pipelines, may include Class 3 and Class 4 areas) whereas HCAs for crude oil, NGL and condensate pipelines are based on high-population areas, certain drinking water sources and unusually sensitive ecological areas.

An MCA is attributable to natural gas pipelines and is based on high-population areas as well as certain principal, high-capacity roadways, though it does not meet the definition of a natural gas pipeline HCA.

First, PHMSA published an October 2019 final rule imposing numerous requirements on onshore gas transmission pipelines relating to maximum allowable operating pressure (“MAOP”) reconfirmation and exceedance reporting, the integrity assessment of additional pipeline mileage found in MCAs and non-HCA Class 3 and Class 4 areas by 2033, and the consideration of seismicity as a risk factor in integrity management.

Second, PHMSA published an October 2019 final rule for hazardous liquid transmission and gathering pipelines that significantly extends and expands the reach of certain of its integrity management requirements, use of in-line inspection tools by 2039 (unless the pipeline cannot be modified to permit such use), increased annual, accident and safety-related conditional reporting requirements, and expanded use of leak detection systems beyond HCAs.

We will need to focus on organic growth and third-party acquisitions.

Financial problems experienced by our customers could result in the impairment of

For a further discussion of our impairments of long-lived assets, see Note 5 — Property, Plant and Equipment and Intangible Assets of the “Consolidated Financial Statements” included in this Annual Report.

Our Series A Preferred gives the holders thereof liquidation and distribution preferences, certain rights relating to our business and management, and the ability to convert such shares into our common stock, potentially causing dilution to our common stockholders.

In March 2016, we issued 965,100 Series A Preferred, which rank senior to the common stock with respect to distribution rights and rights upon liquidation.

Subject to certain exceptions, so long as any Series A Preferred remain outstanding, we may not declare any dividend or distribution on our common stock unless all accumulated and unpaid dividends have been declared and paid on the Series A Preferred.

In the event of our liquidation, winding-up or dissolution, the holders of the Series A Preferred would have the right to receive proceeds from any such transaction before the holders of the common stock.

The payment of the liquidation preference could result in common stockholders not receiving any consideration if we were to liquidate, dissolve or wind up, either voluntarily or involuntarily.

Additionally, the existence of the liquidation preference may reduce the value of the common stock, make it harder for us to sell shares of common stock in offerings in the future, or prevent or delay a change of control.

The Certificate of Designations governing the Series A Preferred provides the Series A Preferred holders with the right to vote, under certain conditions, on an as-converted basis with our common stockholders on matters submitted to a stockholder vote.

The holders of the Series A Preferred do not currently have such right to vote.

Also, so long as any Series A Preferred are outstanding, subject to certain exceptions, the affirmative vote or consent of the holders of at least a majority of the outstanding Series A Preferred shares, voting together as a separate class, will be necessary for effecting or validating, among other things: (i) any issuance of stock senior to the Series A Preferred, (ii) any issuance or increase by any of our consolidated subsidiaries of any issued or authorized amount of, any specific class or series of securities, (iii) any issuance by us of parity stock, subject to certain exceptions and (iv) any incurrence of indebtedness by us and our consolidated subsidiaries for borrowed monies, other than under the Existing TRC Revolver and the Existing TRP Revolver (or replacement commercial bank credit facilities, such as the New TRC Revolver) in an aggregate amount up to $2.75 billion, or indebtedness that complies with a specified fixed charge coverage ratio.

Risk Factors.” Discussions of [removed: 2019] [added: 2020] items and year-to-year comparisons between [removed: 2020] [added: 2021] and [removed: 2019] [added: 2020] that are not included in this Annual Report can be found in Part II, Item 7.

“Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our Annual Report on Form 10-K for the year ended December 31, [removed: 2020.][added: 2021.]

[removed: General] [added: General] Trends and [removed: Outlook][added: Outlook]

[removed: Commodity Prices][added: *Commodity Prices*]

There has been, and we believe there will continue to be, volatility in commodity prices and in the relationships among [removed: NGL,] [added: natural gas, NGL and] crude oil [removed: and natural gas] prices.

The volatility and uncertainty of natural gas, [added: NGL and] crude oil [removed: and NGL] prices impact drilling, completion and other investment decisions by producers and ultimately supply to our systems.

Risk Factors – Our cash flow is affected by supply and demand for natural gas, NGL [removed: products] [added: products,] and crude [removed: oil] [added: oil,] and by natural gas, NGL, crude oil and condensate prices, and decreases in supply, demand or these prices could adversely affect our results of operations and financial condition.”

| | [removed: Natural] [added: Natural] Gas $/MMBtu [removed: (1)] [added: (1)] | | | | [removed: Illustrative] [added: Illustrative] Targa NGL $/gal [removed: (2)] [added: (2)] | | | | [removed: Crude] [added: Crude] Oil $/Bbl [removed: (3)] [added: (3)] | | |

| [removed: 2021] [added: 2021] | | | | | | | | | | | |

| [removed: 2021 Average] [added: 2021 Average] | | 3.85 | | | | 0.78 | | | | 67.90 | |

[removed: | (1) |] Natural gas prices are based on average first of month prices from Henry Hub Inside FERC commercial index prices. [removed: |]

[removed: | (2) |] “Illustrative Targa NGL” pricing is weighted using average quarterly prices from Mont Belvieu Non-TET monthly commercial index and represents the following composition for the periods noted: [removed: |]

[removed: 2020:] [added: 2022:] 43% ethane, 32% propane, 12% normal butane, 4% isobutane and 9% natural gasoline

[removed: | (3) |] Crude oil prices are based on average quarterly prices of West Texas Intermediate crude oil as measured on the NYMEX. [removed: |]

[removed: Volumes] [added: *Volumes] and Demand for our [removed: Services][added: Services*]

[removed: Contract] [added: *Contract] Terms, Contract Mix and the Impact of Commodity [removed: Prices][added: Prices*]

[removed: With the potential for volatility of commodity prices, the contract mix of our Gathering and Processing segment (other than fee-based contracts] [added: Volatility] in [removed: certain gathering and processing business units and gathering and processing services),] [added: commodity prices] can have a significant impact on our profitability, especially those percent-of-proceeds contracts that create direct exposure to changes in energy prices by paying us for gathering and processing services with a portion of proceeds from the commodities handled (“equity volumes”).

[removed: Impact] [added: *Impact] of Our Commodity Price Hedging [removed: Activities][added: Activities*]

[removed: Operating Expenses][added: *Operating Expenses*]

[removed: Volatile] [added: *Volatile] Capital Markets and [removed: Competition][added: Competition*]

We believe we have sufficient access to financial resources and liquidity necessary to meet our requirements for working capital, debt service payments and capital expenditures in [removed: 2022] [added: 2023] and beyond.

[removed: Increased Regulation][added: *Increased Regulation*]

Please read *“Laws and regulations regarding hydraulic fracturing could result in restrictions, delays or cancellations in drilling and completing new oil and natural gas wells by our customers, which could adversely impact our revenues by decreasing the volumes of natural gas, NGLs or crude oil through our facilities and reducing the utilization of our assets”*, *“Our and our customers’ operations are subject to a number of risks arising out of the threat of climate change (including legislation or regulation to address climate change) that could result in increased operating costs, limit the areas in which oil and natural gas production may occur, and reduce demand for the products and services we provide,” and “Increasing [added: stakeholder and market] attention to ESG matters may impact our business”* under Item [removed: 1A of this Annual Report.][added: 1A.]

[removed: How] [added: How] We Evaluate Our [removed: Operations][added: Operations]

[removed: Throughput] [added: *Throughput] Volumes, Facility Efficiencies and Fuel [removed: Consumption][added: Consumption*]

[removed: Capital Expenditures][added: *Capital Expenditures*]

[removed: Non-GAAP Measures][added: *Non-GAAP Measures*]

The GAAP [removed: measure] [added: measures] most directly comparable to these non-GAAP measures are income (loss) from operations, [removed: net] [added: Net] income (loss) attributable to [removed: TRC] [added: Targa Resources Corp.] and segment operating margin.

[removed: Adjusted] [added: *Adjusted] Operating [removed: Margin][added: Margin*]

[removed: | | • |] service fees related to natural gas and crude oil gathering, treating and processing; and [removed: |]

[removed: | | • |] revenues from the sale of natural gas, condensate, crude oil and NGLs less producer settlements, fuel and transport and our equity volume hedge settlements. [removed: |]

[removed: | | • |] service fees (including the pass-through of energy costs included in [added: certain] fee rates); [removed: |]

[removed: | | • |] system product gains and losses; and [removed: |]

[removed: | | • |] NGL and natural gas sales, less NGL and natural gas purchases, fuel, third-party transportation costs and the net inventory change. [removed: |]

[removed: | | • |] the financial performance of our assets without regard to financing methods, capital structure or historical cost basis; [removed: |]

[removed: | | • |] our operating performance and return on capital as compared to other companies in the midstream energy sector, without regard to financing or capital structure; and [removed: |]

[removed: | | • |] the viability of capital expenditure projects and acquisitions and the overall rates of return on alternative investment opportunities. [removed: |]

[removed: Adjusted EBITDA][added: *Adjusted EBITDA*]

We define adjusted EBITDA as [removed: net] [added: Net] income (loss) attributable to [removed: TRC] [added: Targa Resources Corp.] before interest, income taxes, depreciation and amortization, and other items that we believe should be adjusted consistent with our core operating performance.

[removed: Distributable] [added: *Distributable] Cash [removed: Flow and] [added: Flow* *and] Adjusted Free Cash [removed: Flow][added: Flow*]

| 2022 | | | | | | | | | | | |

| 4th Quarter | $ | 6.27 | | | $ | 0.72 | | | $ | 82.63 | |

| 3rd Quarter | | 8.19 | | | | 0.94 | | | | 91.64 | |

| 2nd Quarter | | 7.17 | | | | 1.09 | | | | 108.42 | |

| 1st Quarter | | 4.92 | | | | 1.04 | | | | 94.38 | |

| 2022 Average | | 6.64 | | | | 0.95 | | | | 94.27 | |

| | | | | | | | | | | | |

(1)

(2)

(3)

of this Annual Report.

| | | | | | | | | | |

| | 2022 | | | | | 2021 | | | |

| (Gain) loss from sale of equity method investment | | | (435.9 | ) | | | | — | |

| Transaction costs related to business acquisition (2) | | | 23.9 | | | | | — | |

(1)

(2)

Includes financial advisory, legal and other professional fees, and other one-time transaction costs.

(3)

(4)

(5)

| | | | | | | | | | | | | | | |

| Sales of commodities | $ | 19,066.0 | | | $ | 15,602.5 | | | $ | 3,463.5 | | | 22 | % |

| Total revenues | | 20,929.8 | | | | 16,949.8 | | | | 3,980.0 | | | 23 | % |

| Gain (loss) from sale of equity method investment | | 435.9 | | | | — | | | | 435.9 | | | 100 | % |

| Other, net | | (15.1 | ) | | | 0.5 | | | | (15.6 | ) | NM | | |

| Premium on repurchase of noncontrolling interests, net of tax | | 53.2 | | | | — | | | | 53.2 | | | 100 | % |

(1)

NM Due to a low denominator, the noted percentage change is disproportionately high and, as a result, is not considered meaningful.

The increase in operating expenses is primarily due to increased activity and system expansions, the acquisition of certain assets in South Texas and the Delaware Basin, and inflation, partially offset by the impact of a major winter storm that affected regions across Texas, New Mexico, Oklahoma and Louisiana during the first quarter of 2021.

The increase in depreciation and amortization expense is primarily due to the acquisition of certain assets in the Delaware Basin and South Texas, the shortening of depreciable lives of certain assets that have been, or will be, idled and the impact of system expansions on our asset base, partially offset by a lower depreciable base associated with assets that were impaired during the fourth quarter of 2021.

The increase in interest expense, net is primarily due to higher net borrowings, partially offset by the change in fair value of the mandatorily redeemable preferred interests, higher capitalized interest resulting from higher growth capital investments, and lower commitment fees.

The increase in equity earnings is primarily due to lower losses resulting from the purchase of our remaining interests in the two joint ventures in South Texas that we previously held as investments in unconsolidated affiliates and lower losses from GCF, partially offset by lower earnings resulting from the impact of the GCX Sale and lower earnings from our investment in Little Missouri 4 LLC.

During 2022, the Partnership redeemed the 5.375% Senior Notes due 2027 and the 5.875% Senior Notes due 2026.

In addition, we terminated the Previous TRGP Revolver and the Partnership Revolver.

These transactions resulted in a net loss from financing activities.

During 2022, we completed the GCX Sale resulting in a gain from sale of an equity method investment.

See Note 4 - Acquisitions and Divestitures for further discussion.

The increase in income tax expense is primarily due to an increase in pre-tax book income, partially offset by a larger release of the valuation allowance in 2022 compared to 2021, the impact of statutory rate changes in Oklahoma and Louisiana in 2021 and the correction of a state tax error in 2021.

The decrease in dividends on Series A Preferred is due to the full redemption of all of our issued and outstanding shares of Series A Preferred during 2022.

As a result of reduced economic activity due to the COVID-19 pandemic paired with uncertainty around global commodity supply and demand, global oil and natural gas commodity prices continue to remain volatile.

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| 2020 | | | | | | | | | | | |

| 4th Quarter | $ | 2.66 | | | $ | 0.47 | | | $ | 42.67 | |

| 3rd Quarter | | 1.97 | | | | 0.42 | | | | 40.94 | |

| 2nd Quarter | | 1.70 | | | | 0.32 | | | | 27.55 | |

| 1st Quarter | | 1.98 | | | | 0.36 | | | | 46.59 | |

| 2020 Average | | 2.08 | | | | 0.39 | | | | 39.44 | |

| --- | --- |

| --- | --- | --- |

The Preferred Units that were issued by the Partnership in October 2015 were redeemed in December 2020.

| | 2021 | | | | | 2020 | | | |

| Income attributable to TRP preferred limited partners | | | — | | | | | 15.1 | |

| Severance and related benefits (2) | | | — | | | | | 6.5 | |

| Distributions to TRP preferred limited partners | | | — | | | | | (15.1 | ) |

| (2) | Represents one-time severance and related benefit expense related to our cost reduction measures. |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| Sales of commodities | $ | 15,602.5 | | | $ | 7,171.0 | | | $ | 8,431.5 | | | 118 | % |

| Total revenues | | 16,949.8 | | | | 8,260.3 | | | | 8,689.5 | | | 105 | % |

| Change in contingent considerations | | (0.1 | ) | | | 0.3 | | | | (0.4 | ) | | (133 | %) |

| Other, net | | 0.6 | | | | 3.4 | | | | (2.8 | ) | | (82 | %) |

| (1) | Beginning in 2021, we reclassified certain fuel and power costs previously included in Operating expenses to Product purchases and fuel to better reflect the direct relationship of these costs to our revenue-generating activities and align with our evaluation of the performance of the business. |

The increase in operating expenses was due to higher labor costs and repairs and maintenance primarily due to increased activity levels and system expansions, partially offset by the reduction in expense due to the idling of GCF in 2021.

In 2020, we recognized a non-cash pre-tax impairment loss of $2,442.8 million on assets in the Mid-Continent region associated with our Central operations and full impairment of our Coastal operations.

Other operating (income) expense in 2020 consisted primarily of a loss associated with the reduction in the carrying value of our assets in Channelview, Texas in connection with the October 2020 Sale and write-down of certain assets to their recoverable amounts.

The decrease in equity earnings is primarily due to non-cash pre-tax impairment losses of $77.2 on our investments in T2 Eagle Ford and T2 LaSalle located in the South Texas region and lower earnings from our investments in GCF, Cayenne and GCX DevCo JV.

During 2020, the Partnership repurchased a portion of its outstanding senior notes on the open market and redeemed the 6¾% Senior Notes due 2024 and the 5¼% Senior Notes due 2023, resulting in a $45.6 million net gain from financing activities.

The increase in income tax expense is primarily due to an increase in pre-tax book income.

The increase in net income attributable to noncontrolling interests was partially offset by impairment losses allocated to noncontrolling interest holders in the fourth quarter of 2021 and the impact of the redemption of the Partnership’s preferred units in December 2020.

The decrease in dividends on Series A Preferred is due to the partial repurchase of our Series A Preferred in December 2020.

The decrease in deemed dividends on Series A Preferred is due to the adoption of Accounting Standards Update 2020-06, *Debt - Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity*, which no longer requires the discount accretion related to beneficial conversion feature as a deemed dividend.

| December 31, 2020 | | | 1,017.7 | | | | | 1,128.0 | | | | | 229.7 | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| SouthTX (6) | | | 177.7 | | | | | 248.1 | | | | | (70.4 | ) | | | (28 | %) |

| SouthOK (6) | | | 405.9 | | | | | 443.0 | | | | | (37.1 | ) | | | (8 | %) |

| WestOK | | | 212.6 | | | | | 249.5 | | | | | (36.9 | ) | | | (15 | %) |

| Badlands (6) (7) | | | 139.8 | | | | | 137.8 | | | | | 2.0 | | | | 1 | % |

| Coastal | | | 587.2 | | | | | 643.3 | | | | | (56.1 | ) | | | (9 | %) |

| Total | | | 4,470.3 | | | | | 4,398.3 | | | | | 72.0 | | | | 2 | % |

| SouthTX (6) | | | 22.2 | | | | | 26.1 | | | | | (3.9 | ) | | | (15 | %) |

[removed: Risk Management][added: Risk Management]

In an effort to reduce the variability of our cash flows, we have entered into derivative instruments to hedge the commodity price associated with a portion of our expected natural gas, NGL and condensate equity volumes, future commodity purchases and sales, and transportation basis risk through [removed: 2025.][added: 2027.]

[removed: Commodity] [added: Commodity] Price [removed: Risk][added: Risk]

In an effort to reduce the variability of our cash flows, as of December 31, [removed: 2021,] [added: 2022,] we have hedged the commodity price associated with a portion of our expected (i) natural gas, NGL, and condensate equity volumes in our Gathering and Processing [removed: segment] [added: operations] that result from our 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.

Since we receive from our customers substantially the same floating index price from the sale of the underlying physical commodity, these transactions are designed to effectively [removed: lock-in] [added: lock in] the agreed fixed price in advance for the volumes hedged.

The fair [removed: value] [added: values] of our natural gas and NGL hedges are based on published index prices for delivery at various locations, which closely approximate the actual natural gas and NGL delivery points.

[removed: As long as this first priority lien is in effect,] [added: While] we [removed: expect to] have no [added: current] obligation to post cash, letters of credit or other additional collateral to secure these hedges [removed: at any time, even if] [added: so long as we maintain our current credit rating, we could be obligated to post collateral to secure the hedges in the event of an adverse change in our creditworthiness where] a counterparty’s exposure to our credit increases over the term of the hedge as a result of [added: higher commodity prices.]

The following table shows the effect of hypothetical price movements on the estimated fair value of our derivative instruments as of December 31, [removed: 2021:][added: 2022:]

| | | [removed: Fair Value] [added: Fair Value] | | | | [removed: Result] [added: Result] of 10% Price [removed: Decrease] [added: Decrease] | | | | [removed: Result] [added: Result] of 10% Price [removed: Increase] [added: Increase] | | |

During the years ended December 31, [removed: 2021] [added: 2022] and [removed: 2020,] [added: 2021,] our operating revenues [removed: increased (decreased)] [added: decreased] by [removed: ($490.6)] [added: $(754.7)] million and [removed: $296.9] [added: $(490.6)] million as a result of transactions accounted for as derivatives.

The estimated fair value of our risk management position has moved from a net liability position of [removed: ($51.2)] [added: $316.7] million at December 31, [removed: 2020] [added: 2021] to [removed: a net liability position of ($316.7)] [added: $255.8] million at December 31, [removed: 2021.][added: 2022.]

Forward commodity prices have increased relative to the fixed prices on our derivative contracts, creating [removed: this] [added: the] net liability position.

[removed: Interest] [added: Interest] Rate [removed: Risk][added: Risk]

We are exposed to the risk of changes in interest rates, primarily as a result of variable rate borrowings under the [removed: New TRC Revolver and] [added: TRGP Revolver,] the [added: Commercial Paper Program, the] Securitization [added: Facility, and the Term Loan] Facility.

As of December 31, [removed: 2021,] [added: 2022,] we do not have any interest rate hedges.

To the extent that interest rates increase, interest expense for the [removed: New TRC Revolver and] [added: TRGP Revolver,] the [added: Commercial Paper Program, the] Securitization Facility [added: and the Term Loan Facility] will also increase.

A hypothetical change of 100 basis points in the rate of our variable interest rate debt would impact [removed: the Partnership’s annual interest expense by $1.5 million and] our consolidated annual interest expense by [removed: $1.5] [added: $36.0] million based on our December 31, [removed: 2021] [added: 2022] debt balances.

[removed: Counterparty] [added: Counterparty] Credit [removed: Risk][added: Risk]

[added: We have] master netting provisions in the International Swap Dealers Association agreements with our derivative counterparties.

These netting provisions allow us to net settle asset and liability positions with the same counterparties within the same Targa [removed: entity.][added: entity, and would reduce our maximum loss due to counterparty credit risk by $19.1 million as of December 31, 2022.]

[removed: Customer] [added: Customer] Credit [removed: Risk][added: Risk]

Our allowance for doubtful accounts was [added: $2.2 million and] $0.1 million as of December 31, [removed: 2021] [added: 2022] and December 31, [removed: 2020.][added: 2021, respectively.]

| | | | | | | | | | | | | |

| | | (In millions) | | | | | | | | | | |

| Natural gas | | $ | (267.6 | ) | | $ | (185.1 | ) | | $ | (350.1 | ) |

| NGLs | | | 34.2 | | | | 123.1 | | | | (54.7 | ) |

| Crude oil | | | (22.4 | ) | | | 5.7 | | | | (50.5 | ) |

| Total | | $ | (255.8 | ) | | $ | (56.3 | ) | | $ | (455.3 | ) |

As of December 31, 2022, we had $3.6 billion in outstanding variable rate borrowings.

The range of losses attributable to our individual counterparties as of December 31, 2022 would be between $1.9 million and $16.4 million, depending on the counterparty in default.

The change in the allowance for doubtful accounts was primarily due to the Delaware Basin Acquisition.

No customer comprised 10% or greater of our consolidated revenues during the years ended December 31, 2022 and 2021, respectively.

Our payment obligations in connection with substantially all of these hedging transactions and any additional credit exposure due to a rise in commodity prices relative to the fixed prices set forth in the hedges are secured by a first priority lien in the collateral securing the New TRC Revolver that ranks equal in right of payment with liens granted in favor of Targa’s senior secured lenders.

higher commodity prices or because there has been a change in our creditworthiness.

Upon Targa achieving an investment grade rating, the first priority lien securing such hedges may be terminated at our election.

| Natural gas | | $ | (82.5 | ) | | $ | (36.0 | ) | | $ | (129.0 | ) |

| NGLs | | | (187.4 | ) | | | (114.6 | ) | | | (260.2 | ) |

| Crude oil | | | (46.8 | ) | | | (24.5 | ) | | | (69.1 | ) |

| Total | | $ | (316.7 | ) | | $ | (175.1 | ) | | $ | (458.3 | ) |

As of December 31, 2021, the Partnership had $150.0 million in outstanding variable rate borrowings under the Securitization Facility and we had no borrowings under the Existing TRP Revolver and Existing TRC Revolver.

We have

As of December 31, 2021, all our commodity derivative instruments were in a net liability position, and as such, we had no counterparty credit risk exposure as of that date.

Changes in the allowance for doubtful accounts were not material for the year ended December 31, 2021.

[removed: TARGA] [added: TARGA] RESOURCES [removed: CORP.][added: CORP.]

[removed: CONSOLIDATED BALANCE SHEETS][added: CONSOLIDATED BALANCE SHEETS]

| | [removed: | December] [added: December] 31, [removed: 2021] [added: 2022] | | | | [removed: December] [added: December] 31, [removed: 2020] [added: 2021] | | |

| | [removed: | (In millions)] [added: (In millions)] | | | | | | |

| [removed: ASSETS |] [added: ASSETS] | | | | | | | |

| Current assets: | | | | | | | | [removed: |]

| Cash and cash equivalents | [removed: |] $ | [removed: 158.5] [added: 219.0] | | | $ | [removed: 242.8] [added: 158.5] | |

| Trade receivables, net of allowances of [removed: $0.1] [added: $2.2] million and $0.1 million at December 31, [removed: 2021] [added: 2022] and December 31, [removed: 2020 |] [added: 2021] | | [removed: 1,331.9] [added: 1,408.4] | | | | [removed: 862.8] [added: 1,331.9] | |

| Inventories | | [removed: | 153.4] [added: 393.8] | | | | [removed: 181.5] [added: 153.4] | |

| Assets from risk management activities | | [removed: | 43.1] [added: 179.9] | | | | [removed: 85.5] [added: 43.1] | |

| Other current assets | | [removed: | 82.9] [added: 155.5] | | | | [removed: 87.7] [added: 82.9] | |

| Total current assets | | [removed: | 1,769.8] [added: 2,356.6] | | | | [removed: 1,460.3] [added: 1,769.8] | |

| Property, plant and equipment, net | | [removed: | 11,667.7] [added: 14,214.6] | | | | [removed: 12,173.6] [added: 11,667.7] | |

| Intangible assets, net | | [removed: | 1,094.8] [added: 2,734.6] | | | | [removed: 1,382.4] [added: 1,094.8] | |

| Long-term assets from risk management activities | | [removed: | 7.7] [added: 24.5] | | | | [removed: 49.3] [added: 7.7] | |

| Investments in unconsolidated affiliates | | [removed: | 586.5] [added: 131.3] | | | | [removed: 714.0] [added: 586.5] | |

| Other long-term assets | | [removed: | 81.7] [added: 98.4] | | | | [removed: 96.1] [added: 81.7] | |

| Total assets | [removed: |] $ | [removed: 15,208.2] [added: 19,560.0] | | | $ | [removed: 15,875.7] [added: 15,208.2] | |

| [removed: LIABILITIES,] [added: LIABILITIES,] SERIES A PREFERRED STOCK AND OWNERS' [removed: EQUITY |] [added: EQUITY] | | | | | | | |

| Current liabilities: | | | | | | | | [removed: |]

| Accounts payable | [removed: |] $ | [removed: 1,402.3] [added: 1,448.8] | | | $ | [removed: 833.8] [added: 1,402.3] | |

| Accrued liabilities | | [removed: | 272.2] [added: 273.3] | | | | [removed: 186.4] [added: 272.2] | |

| Distributions payable | | [removed: | 64.5] [added: 16.2] | | | | [removed: 115.4] [added: 64.5] | |

| Interest payable | | [removed: | 138.5] [added: 174.0] | | | | [removed: 132.6] [added: 138.5] | |

| Liabilities from risk management activities | | [removed: | 258.2] [added: 320.1] | | | | [removed: 142.6] [added: 258.2] | |

| Current debt obligations | | [removed: | 162.8] [added: 834.3] | | | | [removed: 368.6] [added: 162.8] | |

| Total current liabilities | | [removed: | 2,298.5] [added: 3,066.7] | | | | [removed: 1,779.4] [added: 2,298.5] | |

| Long-term debt | | [removed: | 6,434.4] [added: 10,702.1] | | | | [removed: 7,387.1] [added: 6,434.4] | |

| Long-term liabilities from risk management activities | | [removed: | 109.3] [added: 140.1] | | | | [removed: 43.4] [added: 109.3] | |

| Deferred income taxes, net | | [removed: | 136.0] [added: 327.7] | | | | [removed: 152.1] [added: 136.0] | |

| Other long-term liabilities | | [removed: | 301.6] [added: 341.2] | | | | [removed: 309.1] [added: 301.6] | |

[removed: | Contingencies (see Note 19) | | | | | | | | |][added: Note 18 – Contingencies]

| Series A Preferred 9.5% Stock, $1,000 per share liquidation preference (1,200,000 shares authorized, [added: zero and] 919,300 shares issued and outstanding as of December 31, [removed: 2021] [added: 2022] and [removed: 2020),] [added: December 31, 2021),] net of discount (see Note 11) | | [removed: | 749.7] [added: —] | | | | [removed: 301.4] [added: 749.7] | |

| Owners' equity: | | | | | | | | [removed: |]

| Targa Resources Corp. stockholders' equity: | | | | | | | | [removed: |]

| Common stock ($0.001 par value, 450,000,000 shares authorized as of December 31, [removed: 2021] [added: 2022] and [removed: 300,000,000 shares authorized as of] December 31, [removed: 2020) |] [added: 2021)] | | 0.2 | | | | 0.2 | |

| Issued Outstanding | | | | | | | | [removed: |]

| December 31, 2021 236,105,293 228,221,122 | | | | | | | | [removed: |]

| Preferred stock ($0.001 par value, after designation of Series A Preferred Stock: 98,800,000 shares authorized, [removed: no] [added: zero] shares issued and outstanding) | | [removed: |] — | | | | — | |

| Additional paid-in capital | | [removed: | 4,268.9] [added: 3,702.3] | | | | [removed: 4,839.9] [added: 4,268.9] | |

| Commitments and Contingencies (see Notes 17 and 18) | | | | | | | |

| December 31, 2022 237,939,058 226,042,229 | | | | | | | |

| Other, net | | | (15.1 | ) | | | 0.5 | | | | 3.7 | |

| Premium on repurchase of noncontrolling interests, net of tax | | | 53.2 | | | | — | | | | — | |

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| | | | | | | | | | | | | | | Retained | | | | Accumulated | | | | | | | | | | | | | | | | | | | | | | |

| | | | | | | | | | | Additional | | | | Earnings | | | | Other | | | | Treasury | | | | | | | | | | | | Total | | | | Series A | | |

| | | Common Stock | | | | | | | | Paid in | | | | (Accumulated | | | | Comprehensive | | | | Shares | | | | | | | | Noncontrolling | | | | Owner's | | | | Preferred | | |

| | | Shares | | | | Amount | | | | Capital | | | | Deficit) | | | | Income (Loss) | | | | Shares | | | | Amount | | | | Interests | | | | Equity | | | | Stock | | |

| | | (In millions, except shares in thousands) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| Balance, December 31, 2021 | | | 228,221 | | | $ | 0.2 | | | $ | 4,268.9 | | | $ | (1,822.3 | ) | | $ | (230.9 | ) | | | 7,884 | | | $ | (204.1 | ) | | $ | 3,166.9 | | | $ | 5,178.7 | | | $ | 749.7 | |

| Repurchases of common stock | | | (3,412 | ) | | | — | | | | — | | | | — | | | | — | | | | 3,412 | | | | (224.8 | ) | | | — | | | | (224.8 | ) | | | — | |

| Dividends - $1.40 per share | | | — | | | | — | | | | — | | | | (318.3 | ) | | | — | | | | — | | | | — | | | | — | | | | (318.3 | ) | | | — | |

| Dividends in excess of retained earnings | | | — | | | | — | | | | (318.3 | ) | | | 318.3 | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | |

| Redemption of Series A Preferred Stock | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | (749.7 | ) |

| Repurchase of noncontrolling interests, net of tax | | | — | | | | — | | | | (53.2 | ) | | | — | | | | — | | | | — | | | | — | | | | (857.9 | ) | | | (911.1 | ) | | | — | |

| Net income (loss) | | | — | | | | — | | | | — | | | | 1,195.5 | | | | — | | | | — | | | | — | | | | 335.9 | | | | 1,531.4 | | | | — | |

| 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 | | | $ | — | |

TARGA RESOURCES CORP.

| Outlays for business acquisition, net of cash acquired | | | (3,503.9 | ) | | | — | | | | — | |

| Outlays for asset acquisition, net of cash acquired | | | (205.2 | ) | | | — | | | | — | |

| Proceeds from borrowings of commercial paper notes | | | 30,504.3 | | | | — | | | | — | |

| Repayments of commercial paper notes | | | (29,495.6 | ) | | | — | | | | — | |

| Proceeds from borrowings under term loan facility | | | 1,500.0 | | | | — | | | | — | |

| Repurchase of noncontrolling interests | | | (926.3 | ) | | | — | | | | — | |

| Redemption of Series A Preferred Stock | | | (965.2 | ) | | | — | | | | — | |

TARGA RESOURCES CORP.

The most noteworthy differences are:

the inclusion of the TRGP senior notes;

the inclusion of the TRGP commercial paper notes;

As of December 31, 2022, our consolidated joint ventures include the following:

50% ownership interest in the Carnero G&P LLC;

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.

88% ownership interest in Cedar Bayou Fractionators, L.P.;

75% ownership interest in Grand Prix Pipeline LLC through the Grand Prix Joint Venture (prior to the Grand Prix Transaction, as defined in Note 4 – Acquisitions and Divestitures); and

80% ownership interest in Targa Train 7 LLC.

| December 31, 2020 234,792,888 228,061,853 | | | | | | | | |

F-5

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| Other, net | | 0.6 | | | | 3.4 | | | | — | |

| Balance, December 31, 2018 | | | 231,791 | | | $ | 0.2 | | | $ | 6,154.9 | | | $ | (130.4 | ) | | $ | 94.3 | | | | 666 | | | $ | (39.6 | ) | | $ | 1,391.4 | | | $ | 7,470.8 | | | $ | 245.7 | |

| Sale of ownership interests in subsidiaries, net | | | — | | | | — | | | | (8.2 | ) | | | — | | | | — | | | | — | | | | — | | | | 1,619.7 | | | | 1,611.5 | | | | — | |

| Net income (loss) | | | — | | | | — | | | | — | | | | (209.2 | ) | | | — | | | | — | | | | — | | | | 250.4 | | | | 41.2 | | | | — | |

| Change in contingent considerations | | | 0.1 | | | | (0.3 | ) | | | 8.7 | |

| Payment of contingent consideration | | | — | | | | — | | | | (317.1 | ) |

| Sale of ownership interests in subsidiaries | | | — | | | | — | | | | 1,619.7 | |

Such immaterial differences include:

| --- | --- | --- |

Beginning in 2021, we reclassified certain fuel and power costs previously included in Operating expenses to Product purchases and fuel within our Consolidated Statements of Operations to better reflect the direct relationship of these costs to our revenue-generating activities and align with our evaluation of the performance of the business.

For the years ended December 31, 2021, 2020 and 2019, we reclassified $64.9 million, $81.4 million and $89.5 million in fuel and power costs, respectively.

Mandatorily Redeemable Preferred Interests

Our partner in the joint ventures holds preferred interests in each joint venture that are redeemable: (i) at our or our partner’s election, on or after July 27, 2022; and (ii) mandatorily, in July 2037.

We have accounted for the notes receivable at fair value.

Upon redemption: (i) the distributable value of our partner’s interest in each joint venture is required to be adjusted by mutual agreement or under a valuation procedure outlined in each joint venture agreement based, among other things, on changes in the market value of the joint venture’s assets allocable to our partner (including the value of the notes receivable); and (ii) the parties are obligated to set off the value of the notes receivable from our partner against the value of our partner’s interest in the applicable joint venture.

For reporting purposes under GAAP, an estimate of our partner’s interest in each joint venture is required to be recorded as if the redemption had occurred on the reporting date.

Because redemption will not be required until at least 2022, the actual value of our partner’s allocable share of each joint venture’s assets at the time of redemption may differ from our estimate of redemption value.

Convertible Debt and Equity Instruments

In August 2020, the Financial Accounting Standards Board issued Accounting Standards Update (“ASU”) 2020-06, *Debt - Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity.* The amendments in this update simplify the accounting for convertible debt instruments and convertible preferred stock by reducing the number of accounting models and embedded conversion features that can be recognized separately from the primary contract.

These amendments also enhance transparency and improve disclosures for convertible instruments and earnings per share guidance.

This update permits the use of either the modified retrospective or full retrospective method of adoption.

On a modified retrospective basis, we adopted the amendments early, effective January 1, 2021.

The primary effect of adoption on the Company was attributable to the elimination of the beneficial conversion feature accounting model (“BCF”), which resulted in the presentation of the Series A Preferred as a single unit of account, without bifurcation of the BCF and corresponding discount.

Therefore, upon adoption, the carrying value of the Series A Preferred was reflected at $749.7 million, which is the allocated amount based on the initial relative fair value allocation of net proceeds at issuance (prior to the allocation to the BCF) of $787.1 million, less the carrying value of the portion repurchased in December 2020 (refer to Note 11 – Preferred Stock).

The adoption did not have an impact on retained earnings (deficit), but rather, the adoption impact flowed through additional paid-in capital where the BCF was previously included.

In addition, the adoption also eliminates the corresponding discount attributable to the BCF and therefore, accretion of the discount as a deemed dividend is no longer required.

The other aspects of this guidance did not have a material effect on our consolidated financial statements.

Little Missouri 4 Joint Venture

In January 2018, we formed a 50/50 joint venture in Little Missouri 4 LLC (“Little Missouri 4”) with Hess Midstream Partners LP to construct a new 200 MMcf/d natural gas processing plant (“LM4 plant”) at Targa’s existing Little Missouri facility.

Little Missouri 4 began operations in the third quarter of 2019.

Targa is the operator of the LM4 plant.

DevCo Joint Ventures

As of December 31, 2021, Stonepeak owned a 95% interest in the Grand Prix DevCo JV, which owned a 20% interest in the Grand Prix Pipeline LLC (the “Grand Prix Joint Venture”) (which does not include the extensions into Southern Oklahoma and Central Oklahoma).

Additionally, Stonepeak owned an 80% interest in both Targa GCX Pipeline LLC (“GCX DevCo JV”), which owned our 25% interest in GCX, and Targa Train 6 LLC (“Train 6 DevCo JV”), which owned a 100% interest in the fractionation train.

The Train 6 DevCo JV did not include certain fractionation-related infrastructure such as brine and storage, which were funded and owned 100% by us.

As of December 31, 2021, we held the remaining interests in the DevCo JVs as well as controlled the management and operation of Grand Prix and Train 6 and consolidated each of the DevCo JVs in our financial statements.

We accounted for the Grand Prix Joint Venture on a consolidated basis in our consolidated financial statements and for GCX as an equity method investment, as disclosed in Note 7 – Investments in Unconsolidated Affiliates.

The Company [removed: has filed an appeal challenging the award, and] [added: appealed] the [removed: appeal is currently pending] [added: award] in the Fourteenth Court of Appeals in Houston, Texas.

In October 2020, we sold Targa [removed: Channelview but,] [added: Channelview, but] under the agreements governing the sale, we retained the liabilities associated with the Vitol proceedings.

Additional information required for this item is provided in Note [removed: 19] [added: 18] – Contingencies, under the heading “Legal Proceedings” included in the Notes to Consolidated Financial Statements included under Part II, Item 8 of this Annual Report, which is incorporated by reference into this item.

On September 13, 2022, the Fourteenth Court of Appeals upheld the trial court’s judgment in part with regard to the return of Vitol’s prior payments, but modified the judgment to delete Vitol’s ability to recover any damages related to losses or demurrage on crude oil.

We have filed a petition for review with the Supreme Court of Texas, and the appeal remains pending.

The cumulative amount of interest on the award through December 31, 2022, if accrued, would have been approximately $42.6 million.

[removed: UNITED STATES][added: UNITED STATES]

[removed: SECURITIES] [added: SECURITIES] AND EXCHANGE [removed: COMMISSION][added: COMMISSION]

[removed: Washington,] [added: Washington,] D.C. [removed: 20549][added: 20549]

[removed: FORM 10-K][added: FORM 10-K]

| [removed: ☑] [added: ☑] | [removed: ANNUAL] [added: ANNUAL] REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF [removed: 1934] [added: 1934] |

[removed: For] [added: For] the fiscal year [removed: ended December] [added: ended December] 31, [removed: 2021][added: 2022]

| [removed: ☐] [added: ☐] | [removed: TRANSITION] [added: TRANSITION] REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF [removed: 1934] [added: 1934] |

[removed: For] [added: For] the transition period from _____ to [removed: _____][added: _____]

[removed: Commission] [added: Commission] File [removed: Number: 001-34991][added: Number: 001-34991]

[removed: ][added: ]

[removed: TARGA] [added: TARGA] RESOURCES [removed: CORP.][added: CORP.]

[removed: (Exact] [added: (Exact] name of registrant as specified in its [removed: charter)][added: charter)]

| [removed: Delaware] [added: Delaware] | | [removed: 20-3701075] [added: 20-3701075] |

| [removed: (State] [added: (State] or other jurisdiction of incorporation or [removed: organization)] [added: organization)] | | [removed: (I.R.S.] [added: (I.R.S.] Employer Identification [removed: No.)] [added: No.)] |

| [removed: 811] [added: 811] Louisiana [removed: Street, Suite 2100, Houston, Texas] [added: Street, Suite 2100, Houston, Texas] | | [removed: 77002] [added: 77002] |

| [removed: (Address] [added: (Address] of principal executive [removed: offices)] [added: offices)] | | [removed: (Zip Code)] [added: (Zip Code)] |

[removed: (713) 584-1000][added: (713) 584-1000]

[removed: (Registrant’s] [added: (Registrant’s] telephone number, including area [removed: code)][added: code)]

[removed: Securities] [added: Securities] registered pursuant to section 12(b) of the [removed: Act:][added: Act:]

| [removed: Title] [added: Title] of each [removed: class] [added: class] | | [removed: Trading Symbol(s)] [added: Trading Symbol(s)] | | [removed: Name] [added: Name] of each exchange on which [removed: registered] [added: registered] |

[removed: Securities] [added: Securities] registered pursuant to section 12(g) of the [removed: Act:] [added: Act:] None

The aggregate market value of the common stock held by non-affiliates of the registrant was [removed: $10,012.0] [added: $13,379.6] million on June 30, [removed: 2021,] [added: 2022,] based on [removed: $44.45] [added: $59.67] per share, the closing price of the common stock as reported on the New York Stock Exchange (NYSE) on such date.

As of February [removed: 18, 2022,] [added: 17, 2023,] there were [removed: 228,783,477] [added: 226,639,398] shares of the registrant’s common stock, $0.001 par value, outstanding.

[removed: DOCUMENTS] [added: DOCUMENTS] INCORPORATED BY [removed: REFERENCE][added: REFERENCE]

Portions of the registrant’s definitive proxy statement for the [removed: 2022] [added: 2023] Annual Meeting of Stockholders, to be filed no later than 120 days after the end of the fiscal year to which this Annual Report on Form 10-K relates, are incorporated by reference into Part III of this Annual Report on Form 10-K.

[removed: TABLE] [added: TABLE] OF [removed: CONTENTS][added: CONTENTS]

| [removed: PART I] [added: PART I] | |

| [Item 1B. Unresolved Staff [removed: Comments.](#ITEM_1B_UNRESOLVED_STAFF_COMMENTS)] [added: Comments.](#item_1b_unresolved_staff_comments)] | [removed: 51] [added: 52] |

| [Item 2. [removed: Properties.](#ITEM_2_PROPERTIES)] [added: Properties.](#item_2_properties)] | [removed: 51] [added: 52] |

| [Item 3. Legal [removed: Proceedings.](#ITEM_3_LEGAL_PROCEEDINGS)] [added: Proceedings.](#item_3_legal_proceedings)] | [removed: 51] [added: 52] |

| [Item 4. Mine Safety [removed: Disclosures.](#ITEM_4_MINE_SAFETY_PART_1)] [added: Disclosures.](#item_4_mine_safety_part_1)] | [removed: 51] [added: 52] |

| [removed: PART II] [added: PART II] | |

| [Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity [removed: Securities.](#ITEM_5_MARKET_FOR_REGISTRANTS_COMMON_EQU)] [added: Securities.](#item_5_market_for_registrants_common_equ)] | [removed: 52] [added: 53] |

| [Item 6. [removed: Reserved](#ITEM_6_Reserved)] [added: Reserved](#item_6_reserved)] | [removed: 53] [added: 54] |

| [Item 7. Management’s Discussion and Analysis of Financial Condition and Results of [removed: Operations.](#ITEM_7_MANAGEMENTS_DISCUSSION_ANALYSIS_F)] [added: Operations.](#item_7_managements_discussion_analysis_f)] | [removed: 54] [added: 55] |

| [Item 7A. Quantitative and Qualitative Disclosures About Market [removed: Risk.](#ITEM_7A_QUANTITATIVE_QUALITATIVE_DISCLOS)] [added: Risk.](#item_7a_quantitative_qualitative_disclos)] | [removed: 70] [added: 71] |

| [Item 8. Financial Statements and Supplementary [removed: Data.](#ITEM_8_FINANCIAL_STATEMENTS_SUPPLEMENTAR)] [added: Data.](#item_8_financial_statements_supplementar)] | [removed: 73] [added: 74] |

| [Item 9. Changes in and Disagreements With Accountants on Accounting and Financial [removed: Disclosure.](#ITEM_9_CHANGES_IN_DISAGREEMENTS_WITH_ACC)] [added: Disclosure.](#item_9_changes_in_disagreements_with_acc)] | [removed: 73] [added: 74] |

| [Item 9A. Controls and [removed: Procedures.](#ITEM_9A_CONTROLS_PROCEDURES)] [added: Procedures.](#item_9a_controls_procedures)] | [removed: 73] [added: 74] |

| [Item 9B. Other [removed: Information.](#ITEM_9B_OR_INFORMATION)] [added: Information.](#item_9b_or_information)] | [removed: 73] [added: 75] |

OR

| | | |

| | | | | |

| | | | | |

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements.

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b).

| | |

downside commodity price volatility from a variety of potential factors;

actions taken by other countries with significant hydrocarbon production;

the timing and success of business development efforts;

the risks described elsewhere in “Item 1A.

| | | |

| SOFR | | Secured Overnight Financing Rate |

Business.

In response to increasing production and to meet the infrastructure needs of producers and our downstream customers, our major expansion projects include the following:

In July 2022, we acquired a 230 MMcf/d cryogenic natural gas processing plant, which was under construction at the time of acquisition, in Permian Delaware (the “Red Hills VI plant”) as part of our Delaware Basin Acquisition (as defined below).

In November 2022, we announced the construction of a new 275 MMcf/d cryogenic natural gas processing plant in Permian Delaware (the “Wildcat II plant”).

The Wildcat II plant is expected to begin operations in the first quarter of 2024.

In February 2023, we announced the transfer of an existing cryogenic natural gas processing plant acquired in the South Texas Acquisition (as defined below) to the Permian Delaware.

The Roadrunner II plant is expected to begin operations in the second quarter of 2024.

*Fractionation Expansion*

In August 2022, we announced plans to construct a new 120 MBbl/d fractionation train in Mont Belvieu, Texas (“Train 9”).

Train 9 is expected to begin operations in the second quarter of 2024.

In January 2023, we reached an agreement with our partners in Gulf Coast Fractionators (“GCF”) to reactivate GCF's 135 MBbl/d fractionation facility.

The facility is expected to be operational during the first quarter of 2024.

*NGL Pipeline Expansion*

In November 2022, we announced plans to construct a new NGL pipeline (the “Daytona NGL Pipeline”) as an addition to our common carrier Grand Prix system.

The pipeline will transport NGLs from the Permian Basin and connect to the 30-inch diameter segment of Grand Prix in North Texas, where volumes will be transported to our fractionation and storage complex in the NGL market hub at Mont Belvieu, Texas.

The Daytona NGL Pipeline is expected to be in service by the end of 2024.

*Capital Investments, Acquisitions and Divestitures*

The DevCo JV Repurchase resulted in an $857.9 million reduction of Noncontrolling interests on our Consolidated Balance Sheets.

In April 2022, we completed the bolt-on acquisition of Southcross Energy Operating LLC and its subsidiaries (“Southcross”) for a purchase price of $201.9 million (the “South Texas Acquisition”), subject to customary closing adjustments.

We made a final net working capital adjustment payment of approximately $1.5 million in the fourth quarter of 2022.

We acquired a portfolio of complementary midstream infrastructure assets and associated contracts that have been integrated into our SouthTX Gathering and Processing operations, including the remaining interests in the two joint ventures in South Texas that we previously held as investments in unconsolidated affiliates, which were consolidated beginning in the second quarter of 2022.

As a result of the GCX Sale, we recognized a gain of $435.9 million in Gain (loss) from sale of equity method investment in our Consolidated Statements of Operations in the second quarter of 2022.

In July 2022, we completed the acquisition of all of the interests in Lucid Energy Delaware, LLC (“Lucid”) for approximately $3.5 billion in cash (the “Delaware Basin Acquisition”), subject to customary closing adjustments.

We received a final net working capital adjustment payment of approximately $11.4 million in the fourth quarter of 2022.

The assets acquired in the Delaware Basin Acquisition provide natural gas gathering, treating, and processing services in the Delaware Basin, through owning and operating approximately 1,050 miles of natural gas pipelines and approximately 1.4 billion cubic feet per day (“Bcf/d”) of cryogenic natural gas processing capacity primarily in Eddy and Lea counties of New Mexico.

The Delaware Basin Acquisition assets are integrated into our Permian Delaware operations.

In January 2023, we completed the acquisition of Blackstone Energy Partners’ 25% interest in Grand Prix Joint Venture (the “Grand Prix Transaction”) for approximately $1.05 billion in cash.

| --- | --- |

OR

| --- | --- | --- |

Business.

In November 2020, we announced the transfer of an existing cryogenic natural gas processing plant from our North Texas system (the “Longhorn plant”), to our Permian Midland system.

The Heim plant, which commenced operations in the third quarter of 2021, processes natural gas production from the Permian Basin.

Capital Allocation

In January 2022, we declared an increase to our common dividend to $0.35 per common share or $1.40 per common share annualized effective for the fourth quarter of 2021 and payable in February 2022.

We expect to receive the full proceeds from the sale in the second quarter of 2022 following a customary call right period in favor of the other members of GCX.

The New TRC Revolver provides for a revolving credit facility in an initial aggregate principal amount up to $2.75 billion and matures on February 17, 2027.

COVID-19 Pandemic

The global spread of COVID-19 during 2020 and 2021 caused significant commodity market volatility.

Nonetheless, we are currently experiencing no material issues with potential workforce, supply chain or customer relationship disruptions.

Although significant progress has been made towards the development, distribution and administration of various COVID-19 vaccines, there continues to be significant uncertainty about the disruptions and other effects related to COVID-19.

As a result, we are unable to determine the extent that these events could materially impact our future financial position, operations and/or cash flows.

For further discussion, see “Item 1A.

Risk Factors.”

Impact of Winter Weather

In February 2021, the Central region of the United States experienced unprecedented cold temperatures during a major winter storm that disrupted production operations, midstream infrastructure and many other services.

This extreme weather caused wide fluctuations in commodity prices, short-term disruptions to our operations across Texas, New Mexico, Oklahoma and Louisiana, including reduced throughput volumes coming into our systems, and adversely affected the operations and financial condition of some of our counterparties.

Though certain of our facilities experienced temporary outages, all facilities have since returned to full operation without sustaining any long-term impacts or significant adverse financial impacts related to the weather event, and throughput volumes have returned to pre-storm levels.

The full financial impact of the winter storm still remains uncertain as it is subject to recently proposed regulatory changes and potential customer and counterparty risk.

The Internal Revenue Service (“IRS”) notified us on April 3, 2019, that it would examine Targa’s federal income tax returns (Form 1120) for 2014, 2015 and 2016.

The IRS completed their examination without proposing any adjustments, and the Joint Committee on Taxation approved the IRS’ findings without any exception.

The Joint Committee on Taxation sent Targa a closing letter dated February 23, 2021.

The closing letter effectively ends the IRS’ audit of Targa’s federal income tax returns for these years.

Additionally, in January 2022, the IRS notified us that it will examine Targa’s net operating loss (“NOL”) carryback previously claimed under the Coronavirus Aid, Relief and Economic Security (“CARES”) Act.

We are cooperating with the IRS in the audit process and do not anticipate material changes in prior year taxable income.

We believe that our near-term growth will be driven by organic projects being placed into service and third-party acquisitions, as well as the level of producer activity in the basins where our gathering and processing infrastructure is located and the level of demand for services provided by our logistics and transportation assets.

During 2021, we processed an average of 4,470.3 MMcf/d of natural gas and produced an average of 550.4 MBbl/d of NGLs.

In addition to our natural gas gathering and processing, the Badlands operations include a crude oil gathering system and four terminals with crude oil operational storage capacity of 205 MBbl, and the Permian operations include a crude oil gathering system and one terminal with crude oil operational storage capacity of 30 MBbl.

During 2021, we purchased or gathered an aggregate average of 175.9 MBbl/d of crude oil in the Badlands and Permian.

We completed construction of the Heim plant, a 200 MMcf/d cryogenic natural gas processing plant, which was relocated from our North Texas system to our Permian Midland system.

The Permian Midland and Permian Delaware systems are interconnected and volumes may flow from one system to the other providing increased operational flexibility and redundancy.

The Silver Oak I and II plants (the “Silver Oak plants”) are each 220 MMcf/d cryogenic plants.

The Raptor plant is a 260 MMcf/d cryogenic plant.

The Chico plant has a processing capacity of 265 MMcf/d.

The gathering system expands into 14 counties with approximately 6,600 miles of natural gas gathering pipelines.

| | | | | | | | | | | Area Total | | | 2,754.0 | | | | 1,928.4 | | | | 277.9 | |

| | | | | | | | | | | Area Total | | | 700.0 | | | | 177.7 | | | | 22.2 | |

[removed: PART II][added: PART II]

[removed: Market Information][added: Market Information]

Our common stock is listed on the NYSE under the symbol “TRGP.” As of December 31, [removed: 2021,] [added: 2022,] there were [removed: 196] [added: 182] stockholders of record of our common stock.

As of February [removed: 18, 2022,] [added: 17, 2023,] there were [removed: 228,783,477] [added: 226,639,398] shares of common stock outstanding.

[removed: Stock] [added: Stock] Performance [removed: Graph][added: Graph]

The graph below compares the cumulative [added: total] return to holders of Targa Resources Corp.’s common stock, the NYSE [removed: Composite] [added: Index, the S&P 500] Index [removed: (the “NYSE Index”)] and the Alerian US Midstream Energy Index (the “AMUS Index”) during the period beginning on December 31, [removed: 2016] [added: 2017] and ending on December 31, [removed: 2021.][added: 2022.]

The performance graph was prepared based on the following assumptions: (i) $100 was invested in our common stock and in each of the indices at [added: the] beginning of the period, and (ii) dividends were reinvested on the relevant payment dates.

[removed: ][added: ]

| | | [removed: Year] [added: Year] Ended December [removed: 31,] [added: 31,] | | | | | | | | | | | | | | | | | | | | | | |

| | | [removed: 2016] [added: 2017] | | | | [removed: 2017] [added: 2018] | | | | [removed: 2018] [added: 2019] | | | | [removed: 2019] [added: 2020] | | | | [removed: 2020] [added: 2021] | | | | [removed: 2021] [added: 2022] | | |

[removed: Our] [added: Our] Dividend [removed: Policy][added: Policy]

For a discussion of restrictions on our and our subsidiaries’ ability to pay dividends or make distributions, please see Note 8 – Debt Obligations [removed: and Note 11 – Preferred Stock] in our Consolidated Financial Statements beginning on page F-1 in this Form 10-K.

[removed: Recent] [added: Recent] Sales of Unregistered Equity [removed: Securities][added: Securities]

There were no sales of unregistered equity securities for the year ended December 31, [removed: 2021.][added: 2022.]

[removed: Repurchase] [added: Repurchase] of Equity by Targa Resources Corp, or Affiliated [removed: Purchasers][added: Purchasers]

| [removed: Period] [added: Period] | | [removed: Total] [added: Total] number of shares purchased [removed: (1)] [added: (1)] | | | | [removed: Average] [added: Average] price per [removed: share] [added: share] | | | | [removed: Total] [added: Total] number of shares purchased as part of publicly announced plans [removed: (2)] [added: (2)] | | | | [removed: Maximum] [added: Maximum] approximate dollar value of shares that may yet be purchased under the plan (in thousands) [removed: (2)] [added: (2)] | | |

[removed: | (1) |] Includes [removed: 756,478] [added: 395,798] shares purchased under our $500 million common share repurchase program, as well as [removed: 3,702] [added: 74,273] shares that were withheld by us to satisfy tax withholding obligations of certain of our officers, directors and key employees that arose upon the lapse of restrictions on restricted stock. [removed: |]

[removed: | (2) |] In the fourth quarter 2020, our board of directors approved a share repurchase program for the repurchase of up to $500 million of our outstanding common stock. [removed: We may discontinue this share repurchase program at any time and are not obligated to repurchase any specific dollar amount or number of shares. |]

On October 12, 2022, we were added to the Standard & Poor's 500 Stock Index (the "S&P 500 Index").

We replaced the NYSE Composite Index (the “NYSE Index”) with the S&P 500 Index, as we believe this index is a more relevant benchmark to measure the Company's performance.

We have continued to present the NYSE Index in this Annual Report for 2022 as a transitional measure.

| | | | | | | | | | | | | | | | | | | | | | | | | |

| Targa Resources Corp. | | $ | 100.00 | | | $ | 80.09 | | | $ | 99.46 | | | $ | 66.93 | | | $ | 133.87 | | | $ | 192.20 | |

| NYSE Index | | $ | 100.00 | | | $ | 91.05 | | | $ | 114.28 | | | $ | 122.26 | | | $ | 147.54 | | | $ | 133.75 | |

| S&P 500 Index | | $ | 100.00 | | | $ | 95.62 | | | $ | 125.72 | | | $ | 148.85 | | | $ | 191.58 | | | $ | 156.88 | |

| AMUS Index | | $ | 100.00 | | | $ | 89.09 | | | $ | 102.95 | | | $ | 77.26 | | | $ | 112.04 | | | $ | 145.15 | |

| | | | | | | | | | | | | | | | | |

| October 1, 2022 - October 31, 2022 | | | 135,863 | | | $ | 62.51 | | | | 61,845 | | | $ | 167,765 | |

| November 1, 2022 - November 30, 2022 | | | 165,697 | | | $ | 72.53 | | | | 165,442 | | | $ | 155,763 | |

| December 1, 2022 - December 31, 2022 | | | 168,511 | | | $ | 71.22 | | | | 168,511 | | | $ | 173,762 | |

(1)

(2)

We may discontinue this share repurchase program at any time and are not obligated to repurchase any specific dollar amount or number of shares.

| Targa Resources Corp. | | $ | 100.00 | | | $ | 103.91 | | | $ | 83.21 | | | $ | 103.35 | | | $ | 69.55 | | | $ | 139.10 | |

| NYSE Composite Index | | $ | 100.00 | | | $ | 115.84 | | | $ | 102.87 | | | $ | 125.83 | | | $ | 131.36 | | | $ | 155.23 | |

| Alerian US Midstream Energy Index | | $ | 100.00 | | | $ | 88.62 | | | $ | 74.04 | | | $ | 79.93 | | | $ | 54.64 | | | $ | 74.31 | |

In addition, so long as any Series A Preferred are outstanding, certain limitations on our ability to declare dividends on our common stock exist.

| October 1, 2021 - October 31, 2021 | | | 1,706 | | | $ | 51.46 | | | | — | | | $ | 408,499.4 | |

| November 1, 2021 - November 30, 2021 | | | 353,224 | | | $ | 54.24 | | | | 351,228 | | | $ | 389,452.6 | |

| December 1, 2021 - December 31, 2021 | | | 405,250 | | | $ | 51.58 | | | | 405,250 | | | $ | 368,547.9 | |

| --- | --- |

[removed: Evaluation] [added: Evaluation] of Disclosure Controls and [removed: Procedures][added: Procedures]

Based on such evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that, as of December 31, [removed: 2021,] [added: 2022,] our disclosure controls and procedures were effective to provide reasonable assurance that information required to be disclosed in our reports filed or submitted under the Exchange Act is (i) recorded, processed, summarized and reported within the time periods specified in the rules and forms of the SEC and (ii) accumulated and communicated to management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow for timely decisions regarding required disclosure.

[removed: Internal] [added: Internal] Control Over Financial [removed: Reporting][added: Reporting]

[removed: | (a) | Management’s] [added: Management’s] Report on Internal Control Over Financial [removed: Reporting |][added: Reporting]

Management concluded that our internal control over financial reporting was effective as of December 31, [removed: 2021.][added: 2022.]

[removed: | (b) | Changes] [added: Changes] in Internal Control Over Financial [removed: Reporting |][added: Reporting]

[removed: There] [added: Other than as set forth above, there] have been no changes in our internal control over financial reporting during our most recent fiscal quarter ended December 31, [removed: 2021] [added: 2022] that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

(a)

In July 2022, we completed the Delaware Basin Acquisition.

The Delaware Basin Acquisition constituted approximately 2% of total consolidated revenues for the year ended December 31, 2022 and approximately 10% of total consolidated assets at December 31, 2022.

Management’s assessment of and conclusion on the effectiveness of internal control over financial reporting as of December 31, 2022 excluded the Delaware Basin Acquisition.

This exclusion is in accordance with the SEC guidance that an assessment of recent business

combinations may be omitted from management’s assessment of internal control over financial reporting for one year following the acquisition.

(b)

| --- | --- |

[removed: PART III][added: PART III]

The information required in response to this item will be set forth in our definitive proxy statement for the [removed: 2022] [added: 2023] annual meeting of stockholders and is incorporated herein by reference.

The information required in response to this item will be set forth in our definitive proxy statement for the [removed: 2022] [added: 2023] annual meeting of stockholders and is incorporated herein by reference.

The information required in response to this item will be set forth in our definitive proxy statement for the [removed: 2022] [added: 2023] annual meeting of stockholders and is incorporated herein by reference.

The information required in response to this item will be set forth in our definitive proxy statement for the [removed: 2022] [added: 2023] annual meeting of stockholders and is incorporated herein by reference.

The information required in response to this item will be set forth in our definitive proxy statement for the [removed: 2022] [added: 2023] annual meeting of stockholders and is incorporated herein by reference.

[removed: PART IV][added: PART IV]

| [removed: Number] [added: Number] | | [removed: Description] [added: Description] |

| 3.1 | | [Amended and Restated Certificate of Incorporation of Targa Resources Corp. (incorporated by reference to Exhibit 3.1 to Targa Resources Corp.’s Current Report on Form 8-K filed December 16, 2010 (File No. [removed: 001-34991)).](http://www.sec.gov/Archives/edgar/data/1389170/000095012310114218/h78297exv3w1.htm)] [added: 001-34991)).](https://www.sec.gov/Archives/edgar/data/1389170/000095012310114218/h78297exv3w1.htm)] |

| 3.2 | | [Certificate of Amendment to the Amended and Restated Certificate of Incorporation of Targa Resources Corp. (incorporated by reference to Exhibit 3.1 to Targa Resources Corp.’s Current Report on Form 8-K filed May 26, 2021 (File No. [removed: 001-34991)).](http://www.sec.gov/Archives/edgar/data/1389170/000119312521173640/d140306dex31.htm)] [added: 001-34991)).](https://www.sec.gov/Archives/edgar/data/1389170/000119312521173640/d140306dex31.htm)] |

| 3.3 | | [Certificate of Designations of Series A Preferred Stock of Targa Resources Corp., filed with the Secretary of State of the State of Delaware on March 16, 2016 (incorporated by reference to Exhibit 3.1 to Targa Resources Corp.’s Current Report on Form 8-K/A filed March 17, 2016 (File No. [removed: 001-34991)).](http://www.sec.gov/Archives/edgar/data/1389170/000119312516508783/d198929dex31.htm)] [added: 001-34991)).](https://www.sec.gov/Archives/edgar/data/1389170/000119312516508783/d198929dex31.htm)] |

| 3.4 | | [Amended and Restated Bylaws of Targa Resources Corp. (incorporated by reference to Exhibit 3.2 to Targa Resources Corp.’s Current Report on Form 8-K filed December 16, 2010 (File No. [removed: 001-34991)).](http://www.sec.gov/Archives/edgar/data/1389170/000095012310114218/h78297exv3w2.htm)] [added: 001-34991)).](https://www.sec.gov/Archives/edgar/data/1389170/000095012310114218/h78297exv3w2.htm)] |

| 3.5 | | [First Amendment to the Amended and Restated Bylaws of Targa Resources Corp. (incorporated by reference to Exhibit 3.1 to Targa Resources Corp.’s Current Report on Form 8-K filed January 15, 2016 (File No. [removed: 001-34991)).](http://www.sec.gov/Archives/edgar/data/1389170/000119312516430392/d10246dex31.htm)] [added: 001-34991)).](https://www.sec.gov/Archives/edgar/data/1389170/000119312516430392/d10246dex31.htm)] |

| 4.1 | | [Specimen Common Stock Certificate (incorporated by reference to Exhibit 4.1 to Targa Resources Corp.’s Registration Statement on Form S-1/A filed November 12, 2010 (File No. [removed: 333-169277)).](http://www.sec.gov/Archives/edgar/data/1389170/000095012310104672/h75749a3exv4w1.htm)] [added: 333-169277)).](https://www.sec.gov/Archives/edgar/data/1389170/000095012310104672/h75749a3exv4w1.htm)] |

| 4.2 | | [Registration Rights Agreement, dated March 16, 2016, by and among Targa Resources Corp. and the purchasers named on Schedule A thereto (incorporated by reference to Exhibit 4.1 to Targa Resources Corp.’s Current Report on Form 8-K/A filed March 17, 2016 (File No. [removed: 001-34991)).](http://www.sec.gov/Archives/edgar/data/1389170/000119312516508783/d198929dex41.htm)] [added: 001-34991)).](https://www.sec.gov/Archives/edgar/data/1389170/000119312516508783/d198929dex41.htm)] |

| 4.3 | | [Amendment No. 1 to the Registration Rights Agreement dated March 16, 2016, dated September 13, 2016, among Targa Resources Corp. and Stonepeak Target Holdings, LP and Stonepeak Target Upper Holdings LLC (incorporated by reference to Exhibit 4.3 to Targa Resources Corp.’s Quarterly Report on Form 10-Q filed November 4, 2016 (File No. [removed: 001-34991)).](http://www.sec.gov/Archives/edgar/data/1389170/000156459016027687/trgp-ex43_523.htm)] [added: 001-34991)).](https://www.sec.gov/Archives/edgar/data/1389170/000156459016027687/trgp-ex43_523.htm)] |

| 4.4 | | [Registration Rights Agreement, dated March 16, 2016, by and among Targa Resources Corp. and the purchasers named on Schedule A thereto (incorporated by reference to Exhibit 4.2 to Targa Resources Corp.’s Current Report on Form 8-K/A filed March 17, 2016 (File No. [removed: 001-34991)).](http://www.sec.gov/Archives/edgar/data/1389170/000119312516508783/d198929dex42.htm)] [added: 001-34991)).](https://www.sec.gov/Archives/edgar/data/1389170/000119312516508783/d198929dex42.htm)] |

| 4.5 | | [Amendment No. 1 to the Registration Rights Agreement dated March 16, 2016, dated September 13, 2016, among Targa Resources Corp. and Stonepeak Target Holdings, LP and Stonepeak Target Upper Holdings LLC (incorporated by reference to Exhibit 4.2 to Targa Resources Corp.’s Quarterly Report on Form 10-Q filed November 4, 2016 (File No. [removed: 001-34991)).](http://www.sec.gov/Archives/edgar/data/1389170/000156459016027687/trgp-ex42_524.htm)] [added: 001-34991)).](https://www.sec.gov/Archives/edgar/data/1389170/000156459016027687/trgp-ex42_524.htm)] |

| 4.6 | | [Board Representation and Observation Rights Agreement, dated as of March 16, 2016, by and between Targa Resources Corp. and Stonepeak Target Holdings LP (incorporated by reference to Exhibit 4.3 to Targa Resources Corp.’s Current Report on Form 8-K/A filed March 17, 2016 (File No. [removed: 001-34991)).](http://www.sec.gov/Archives/edgar/data/1389170/000119312516508783/d198929dex43.htm)] [added: 001-34991)).](https://www.sec.gov/Archives/edgar/data/1389170/000119312516508783/d198929dex43.htm)] |

| 4.7 | | [Warrant Agreement, dated as of March 16, 2016, by and among Targa Resources Corp., Computershare Inc. and Computershare Trust Company, N.A. (incorporated by reference to Exhibit 4.4 to Targa Resources Corp.’s Current Report on Form 8-K/A filed March 17, 2016 (File No. [removed: 001-34991)).](http://www.sec.gov/Archives/edgar/data/1389170/000119312516508783/d198929dex44.htm)] [added: 001-34991)).](https://www.sec.gov/Archives/edgar/data/1389170/000119312516508783/d198929dex44.htm)] |

| 4.8 | | [Description of Securities Registered Under Section 12 of the Exchange Act (incorporated by reference to Exhibit 4.8 to Targa Resources Corp.’s Annual Report on Form 10-K filed February 20, 2020 (File No. [removed: 001-34991)).](http://www.sec.gov/Archives/edgar/data/1389170/000156459020005592/trgp-ex48_735.htm)] [added: 001-34991)).](https://www.sec.gov/Archives/edgar/data/1389170/000156459020005592/trgp-ex48_735.htm)] |

| 10.1 | | [removed: [Third Amendment and Restatement] [added: [Credit] Agreement dated as of [removed: June 29, 2018,] [added: February 17, 2022,] by and among Targa Resources [removed: Partners LP,] [added: Corp.,] Bank of America, N.A., and the other parties signatory thereto (incorporated by reference to Exhibit 10.1 to Targa Resources [removed: Partners LP’s] [added: Corp.’s] Current Report on Form 8-K [added: filed February 23, 2022] (File No. [removed: 001-33303) filed July 3, 2018).](http://www.sec.gov/Archives/edgar/data/1379661/000119312518212507/d690016dex101.htm)] [added: 001-34991)).](https://www.sec.gov/Archives/edgar/data/1389170/000119312522050041/d305853dex101.htm)] |

| [removed: 10.2] [added: 4.22] | | [removed: [First Amendment to Fourth Amended and Restated Credit Agreement,] [added: [Indenture] dated as of [removed: June 7, 2019, by and] [added: January 17, 2019] among [removed: Targa Resources Partners LP, Bank of America, N.A. and] the [removed: other parties signatory thereto] [added: Issuers, the Guarantors and U.S. Bank National Association, as trustee] (incorporated by reference to Exhibit [removed: 10.1] [added: 4.1] to Targa Resources Partners LP’s Current Report on Form 8-K filed [removed: June 11,] [added: January 23,] 2019 (File No. [removed: 001-33303)).](http://www.sec.gov/Archives/edgar/data/1379661/000119312519170255/d763390dex101.htm)] [added: 001-33303)).](https://www.sec.gov/Archives/edgar/data/1379661/000119312519014870/d689562dex41.htm)] |

| [removed: 10.3] [added: 10.49] | | [removed: [Credit] [added: [Term Loan] Agreement, dated as of [removed: February 27, 2015,] [added: July 12, 2022,] among Targa Resources Corp., [removed: each lender from time to time party thereto and Bank of America, N.A.] [added: Mizuho Bank, Ltd.,] as administrative [removed: agent, collateral agent, swing line lender] [added: agent] and [removed: letter of credit issuer] [added: a lender, and the other lenders parties thereto] (incorporated by reference to Exhibit 10.1 to Targa Resources Corp.’s Current Report on Form 8-K filed [removed: March 4, 2015] [added: July 12, 2022] (File No. [removed: 001-34991)).](http://www.sec.gov/Archives/edgar/data/1389170/000119312515075450/d883591dex101.htm)] [added: 001-34991)).](https://www.sec.gov/Archives/edgar/data/1389170/000119312522192023/d268181dex101.htm)] |

| [removed: 10.4] [added: 10.26+] | | [removed: [First Amendment to Credit] [added: [Indemnification] Agreement [removed: dated as of June 29, 2018,] by and [removed: among] [added: between] Targa Resources [removed: Corp., Bank of America, N.A.,] [added: Corp.] and [removed: the other parties signatory thereto] [added: Waters S. Davis, IV, dated July 23, 2015] (incorporated by reference to Exhibit 10.1 to Targa Resources Corp.’s Current Report on Form 8-K filed July [removed: 3, 2018] [added: 24, 2015] (File No. [removed: 001-34991)).](http://www.sec.gov/Archives/edgar/data/1389170/000119312518212538/d689840dex101.htm)] [added: 001-34991)).](https://www.sec.gov/Archives/edgar/data/1389170/000119312515262800/d42428dex101.htm)] |

| [removed: 10.5+] [added: 10.2+] | | [Amended and Restated Targa Resources Corp. 2010 Stock Incentive Plan, as amended and restated effective May 22, 2017 (incorporated by reference to Exhibit 10.1 to Targa Resources Corp.’s Current Report on Form 8-K filed May 23, 2017 (File No. [removed: 001-34991)).](http://www.sec.gov/Archives/edgar/data/1389170/000119312517179646/d392172dex101.htm)] [added: 001-34991)).](https://www.sec.gov/Archives/edgar/data/1389170/000119312517179646/d392172dex101.htm)] |

| [removed: 10.6+] [added: 10.3+] | | [Form of Restricted Stock Unit Agreement (incorporated by reference to Exhibit 10.1 to Targa Resources Corp.’s Current Report on Form 8-K filed July 18, 2013 (File No. [removed: 001-34991)).](http://www.sec.gov/Archives/edgar/data/1389170/000119312513294369/d570862dex101.htm)] [added: 001-34991)).](https://www.sec.gov/Archives/edgar/data/1389170/000119312513294369/d570862dex101.htm)] |

| [removed: 10.7+] [added: 10.4+] | | [Form of Restricted Stock Agreement (incorporated by reference to Exhibit 10.2 to Targa Resources Corp.’s Current Report on Form 8-K filed July 18, 2013 (File No. [removed: 001-34991)).](http://www.sec.gov/Archives/edgar/data/1389170/000119312513294369/d570862dex102.htm)] [added: 001-34991)).](https://www.sec.gov/Archives/edgar/data/1389170/000119312513294369/d570862dex102.htm)] |

| [removed: 10.8+] [added: 10.5+] | | [Form of Restricted Stock Agreement for Directors, dated as of January 17, 2018 (incorporated by reference to Exhibit 10.13 to Targa Resources Corp.’s Annual Report on Form 10-K filed February 16, 2018 (File No. [removed: 001-34991)).](http://www.sec.gov/Archives/edgar/data/1389170/000156459018002330/trgp-ex1013_304.htm)] [added: 001-34991)).](https://www.sec.gov/Archives/edgar/data/1389170/000156459018002330/trgp-ex1013_304.htm)] |

| [removed: 10.9+] [added: 10.6+] | | [Form of Restricted Stock Agreement under Targa Resources Corp. 2010 Stock Incentive Plan (incorporated by reference to Exhibit 10.3 to Targa Resources Corp.’s Quarterly Report on Form 10-Q filed May 10, 2016 (File No. [removed: 001-34991)).](http://www.sec.gov/Archives/edgar/data/1389170/000156459016018893/trgp-ex103_231.htm)] [added: 001-34991)).](https://www.sec.gov/Archives/edgar/data/1389170/000156459016018893/trgp-ex103_231.htm)] |

| [removed: 10.10+] [added: 10.7+] | | [Form of Performance Share Unit Grant Agreement, dated as of January 17, 2019 under Targa Resources Corp. 2010 Stock Incentive Plan (incorporated by reference to Exhibit 10.19 to Targa Resources Corp.’s Annual Report on Form 10-K filed March 1, 2019 (File No. [removed: 001-34991).](http://www.sec.gov/Archives/edgar/data/1389170/000156459019005727/trgp-ex1019_424.htm)] [added: 001-34991).](https://www.sec.gov/Archives/edgar/data/1389170/000156459019005727/trgp-ex1019_424.htm)] |

| [removed: 10.11+] [added: 10.8+] | | [Form of Performance Share Unit Grant Agreement, dated as of January 16, 2020 under Targa Resources Corp. 2010 Stock Incentive Plan (incorporated by reference to Exhibit 10.12 to Targa Resources Corp.’s Annual Report on Form 10-K filed February 20, 2020 (File No. [removed: 001-34991)).](http://www.sec.gov/Archives/edgar/data/1389170/000156459020005592/trgp-ex1012_539.htm)] [added: 001-34991)).](https://www.sec.gov/Archives/edgar/data/1389170/000156459020005592/trgp-ex1012_539.htm)] |

| [removed: 10.12+*] [added: 10.9+] | | [Form of Performance Share Unit Grant Agreement, dated as of January 20, 2022 under Targa Resources Corp. 2010 Stock Incentive [removed: Plan.](https://www.sec.gov/Archives/edgar/data/1389170/000156459022006563/trgp-ex1012_79.htm)] [added: Plan (incorporated by reference to Exhibit 10.12 to Targa Resources Corp.’s Annual Report on Form 10-K filed February 24, 2022 (File No. 001-34991)).](https://www.sec.gov/Archives/edgar/data/1389170/000156459022006563/trgp-ex1012_79.htm)] |

| [removed: 10.13+*] [added: 10.10+] | | [Omnibus Amendment to Performance Share Unit Grant Agreements, dated as of December 15, [removed: 2021.](https://www.sec.gov/Archives/edgar/data/1389170/000156459022006563/trgp-ex1013_78.htm)] [added: 2021 (incorporated by reference to Exhibit 10.13 to Targa Resources Corp.’s Annual Report on Form 10-K filed February 24, 2022 (File No. 001-34991)).](https://www.sec.gov/Archives/edgar/data/1389170/000156459022006563/trgp-ex1013_78.htm)] |

| [removed: 10.14+] [added: 10.11+] | | [Form of Restricted Stock Unit Agreement (Bonus Grant), dated as of January 16, 2020 under Targa Resources Corp. 2010 Stock Incentive Plan (incorporated by reference to Exhibit 10.13 to Targa Resources Corp.’s Annual Report on Form 10-K filed February 20, 2020 (File No. [removed: 001-34991)).](http://www.sec.gov/Archives/edgar/data/1389170/000156459020005592/trgp-ex1013_540.htm)] [added: 001-34991)).](https://www.sec.gov/Archives/edgar/data/1389170/000156459020005592/trgp-ex1013_540.htm)] |

| [removed: 10.15+] [added: 10.12+] | | [Form of Restricted Stock Unit Agreement, dated as of January 16, 2020 under Targa Resources Corp. 2010 Stock Incentive Plan (incorporated by reference to Exhibit 10.14 to Targa Resources Corp.’s Annual Report on Form 10-K filed February 20, 2020 (File No. [removed: 001-34991)).](http://www.sec.gov/Archives/edgar/data/1389170/000156459020005592/trgp-ex1014_541.htm)] [added: 001-34991)).](https://www.sec.gov/Archives/edgar/data/1389170/000156459020005592/trgp-ex1014_541.htm)] |

| [removed: 10.16+] [added: 10.13+] | | [Targa Resources Corp. 2020 Annual Incentive Compensation Plan (incorporated by reference to Exhibit 10.1 to Targa Resources Corp.’s Current Report on Form 8-K filed January 23, 2020 (File No. [removed: 001-34991)).](http://www.sec.gov/Archives/edgar/data/1389170/000119312520013204/d875060dex101.htm)] [added: 001-34991)).](https://www.sec.gov/Archives/edgar/data/1389170/000119312520013204/d875060dex101.htm)] |

| [removed: 10.17+] [added: 10.14+] | | [First Amendment to the Targa Resources Corp. Amended and Restated Stock Incentive Plan (incorporated by reference to Exhibit 10.16 to Targa Resources Corp.’s Annual Report on Form 10-K filed February 18, 2021 (File No. [removed: 001-34991)).](http://www.sec.gov/Archives/edgar/data/1389170/000156459021006640/trgp-ex1016_1219.htm)] [added: 001-34991)).](https://www.sec.gov/Archives/edgar/data/1389170/000156459021006640/trgp-ex1016_1219.htm)] |

| [removed: 10.18+] [added: 10.15+] | | [Targa Resources Executive Officer Change in Control Severance Program (incorporated by reference to Exhibit 10.3 to Targa Resources Corp.’s Current Report on Form 8-K filed January 19, 2012 (File No. [removed: 001-34991)).](http://www.sec.gov/Archives/edgar/data/1389170/000119312512017046/d285393dex103.htm)] [added: 001-34991)).](https://www.sec.gov/Archives/edgar/data/1389170/000119312512017046/d285393dex103.htm)] |

| [removed: 10.19+] [added: 10.16+] | | [First Amendment to the Targa Resources Executive Officer Change in Control Severance Program, dated December 3, 2015 (incorporated by reference to Exhibit 10.1 to Targa Resources Corp.’s Current Report on Form 8-K filed December 8, 2015 (File No. [removed: 001-34991)).](http://www.sec.gov/Archives/edgar/data/1389170/000119312515397008/d97161dex101.htm)] [added: 001-34991)).](https://www.sec.gov/Archives/edgar/data/1389170/000119312515397008/d97161dex101.htm)] |

| [removed: 10.20] [added: 4.20] | | [removed: [Indenture] [added: [Supplemental Indenture] dated [removed: as of] [added: June 17, 2022 to Indenture dated] October [removed: 6, 2016] [added: 17, 2017] among [added: the Guaranteeing Subsidiary,] Targa Resources Partners LP, Targa Resources Partners Finance [removed: Corporation and] [added: Corporation,] the [added: other Subsidiary] Guarantors and U.S. Bank National [removed: Association, as trustee] [added: Association] (incorporated by reference to Exhibit 10.1 to Targa Resources Corp.’s [removed: Current] [added: Quarterly] Report on Form [removed: 8-K] [added: 10-Q] filed [removed: October 12, 2016] [added: August 4, 2022] (File No. [removed: 001-34991)).](http://www.sec.gov/Archives/edgar/data/1389170/000119312516736767/d250412dex101.htm)] [added: 001-34991)).](https://www.sec.gov/Archives/edgar/data/1389170/000156459022027962/trgp-ex101_390.htm)] |

| 10.21 | | [Registration Rights Agreement dated as of [removed: October 6, 2016] [added: August 18, 2020] among [removed: Targa Resources Partners LP, Targa Resources Partners Finance Corporation,] the [added: Issuers, the] Guarantors and Wells Fargo Securities, LLC, as representative of the several [removed: initial purchasers] [added: Initial Purchasers] party thereto (incorporated by reference to Exhibit [removed: 10.2] [added: 4.2] to Targa Resources [removed: Corp.’s] [added: Partners LP’s] Current Report on Form 8-K [removed: filed October 12, 2016] (File No. [removed: 001-34991)).](http://www.sec.gov/Archives/edgar/data/1389170/000119312516736767/d250412dex102.htm)] [added: 001-33303) filed August 21, 2020).](https://www.sec.gov/Archives/edgar/data/1379661/000119312520227030/d58008dex42.htm)] |

| [removed: 10.22] [added: 4.15] | | [Supplemental Indenture dated [removed: March 10, 2017] [added: February 20, 2020] to Indenture dated October [removed: 6, 2016,] [added: 17, 2017,] among the Guaranteeing Subsidiary, Targa Resources Partners LP, Targa Resources Partners Finance Corporation, the other Subsidiary Guarantors and U.S. Bank National Association (incorporated by reference to Exhibit [removed: 4.8] [added: 10.5] to Targa Resources [removed: Partners LP’s] [added: Corp.’s] Quarterly Report on Form 10-Q filed May [removed: 4, 2017] [added: 7, 2020] (File No. [removed: 001-33303)).](http://www.sec.gov/Archives/edgar/data/1379661/000156459017008710/ngls-ex48_712.htm)] [added: 001-34991)).](https://www.sec.gov/Archives/edgar/data/1389170/000156459020022780/trgp-ex105_262.htm)] |

| [removed: 10.23] [added: 4.47] | | [Supplemental Indenture dated [removed: June 16, 2017] [added: September 17, 2021] to Indenture dated [removed: October 6, 2016,] [added: February 2, 2021] among the Guaranteeing Subsidiary, Targa Resources Partners LP, Targa Resources Partners Finance Corporation, the other Subsidiary Guarantors and U.S. Bank National Association (incorporated by reference to Exhibit 10.7 to Targa Resources Corp.’s Quarterly Report on Form 10-Q filed November [removed: 3, 2017] [added: 4, 2021] (File No. [removed: 001-34991)).](http://www.sec.gov/Archives/edgar/data/1389170/000156459017021452/trgp-ex107_370.htm)] [added: 001-34991)).](https://www.sec.gov/Archives/edgar/data/1389170/000156459021054348/trgp-ex107_65.htm)] |

| [removed: 10.24] [added: 4.11] | | [Supplemental Indenture dated December 18, 2017 to Indenture dated October [removed: 6, 2016,] [added: 17, 2017,] among the Guaranteeing Subsidiary, Targa Resources Partners LP, Targa Resources Partners Finance Corporation, the other Subsidiary Guarantors and U.S. Bank National Association (incorporated by reference to Exhibit [removed: 10.61] [added: 10.66] to Targa Resources Corp.’s Annual Report on Form 10-K filed February 16, 2018 (File No. [removed: 001-34991)).](http://www.sec.gov/Archives/edgar/data/1389170/000156459018002330/trgp-ex1061_293.htm)] [added: 001-34991)).](https://www.sec.gov/Archives/edgar/data/1389170/000156459018002330/trgp-ex1066_291.htm)] |

| [removed: 10.25] [added: 4.12] | | [Supplemental Indenture dated January 9, 2018 to Indenture dated October [removed: 6, 2016,] [added: 17, 2017,] among the Guaranteeing Subsidiary, Targa Resources Partners LP, Targa Resources Partners Finance Corporation, the other Subsidiary Guarantors and U.S. Bank National Association (incorporated by reference to Exhibit [removed: 10.62] [added: 10.67] to Targa Resources Corp.’s Annual Report on Form 10-K filed February 16, 2018 (File No. [removed: 001-34991)).](http://www.sec.gov/Archives/edgar/data/1389170/000156459018002330/trgp-ex1062_292.htm)] [added: 001-34991)).](https://www.sec.gov/Archives/edgar/data/1389170/000156459018002330/trgp-ex1067_289.htm)] |

| [removed: 10.26] [added: 4.13] | | [Supplemental Indenture dated July 24, 2018 to Indenture dated October [removed: 6, 2016,] [added: 17, 2017,] among the Guaranteeing Subsidiary, Targa Resources Partners LP, Targa Resources Partners Finance Corporation, the other Subsidiary Guarantors and U.S. Bank National Association (incorporated by reference to Exhibit [removed: 10.8] [added: 10.9] to Targa Resources Corp.’s Quarterly Report on Form 10-Q filed August 9, 2018 (File No. [removed: 001-34991)).](http://www.sec.gov/Archives/edgar/data/1389170/000156459018020681/trgp-ex108_266.htm)] [added: 001-34991)).](https://www.sec.gov/Archives/edgar/data/1389170/000156459018020681/trgp-ex109_264.htm)] |

| 2.1 | | [Purchase and Sale Agreement, dated as of June 16, 2022 by and among Lucid Energy Group II Holdings, LLC, Lasso Acquiror LLC and Lucid Energy Group II LLC (incorporated by reference to Exhibit 2.1 to Targa Resources Corp.’s Current Report on Form 8-K filed June 17, 2022 (File No. 001-34991)).](https://www.sec.gov/Archives/edgar/data/1389170/000119312522176591/d222564dex21.htm) |

| 3.6 | | [Second Amended and Restated Bylaws of Targa Resources Corp. (incorporated by reference to Exhibit 3.4 to Targa Resources Corp.’s Quarterly Report on Form 10-Q filed May 5, 2022 (File No. 001-34991)).](https://www.sec.gov/Archives/edgar/data/1389170/000156459022018168/trgp-ex34_534.htm) |

| 4.9 | | [Parent Guarantee dated as of February 18, 2022, by and among Targa Resources Corp. and certain of its subsidiaries (incorporated by reference to Exhibit 4.1 to Targa Resources Corp.’s Current Report on Form 8-K filed February 23, 2022 (File No. 001-34991)).](https://www.sec.gov/Archives/edgar/data/1389170/000119312522050041/d305853dex41.htm) |

| 4.54 | | [Form of Notes (included in Exhibit 4.53 hereto) (incorporated by reference to Exhibit 4.3 to Targa Resources Corp.’s Current Report on Form 8-K filed April 6, 2022 (File No. 001-34991)).](https://www.sec.gov/Archives/edgar/data/1389170/000119312522097513/d343533dex42.htm) |

| 4.55 | | [Second Supplemental Indenture dated as of June 22, 2022, among Targa Resources Corp., as issuer, the guarantors named therein and U.S. Bank Trust Company, National Association, as trustee (incorporated by reference to Exhibit 4.9 to Targa Resources Corp.’s Post-Effective Amendment No. 1 to Form S-3 filed June 22, 2022 (Registration No. 333-263730)).](https://www.sec.gov/Archives/edgar/data/1389170/000119312522178283/d250494dex49.htm) |

| 4.57 | | [Form of Notes (included in Exhibit 4.56 hereto) (incorporated by reference to Exhibit 4.3 to Targa Resources Corp.’s Current Report on Form 8-K filed July 7, 2022 (File No. 001-34991)).](https://www.sec.gov/Archives/edgar/data/1389170/000119312522189454/d358708dex42.htm) |

| 4.60 | | [Form of Notes (included in Exhibit 4.59 hereto) (incorporated by reference to Exhibit 4.3 to Targa Resources Corp.’s Current Report on Form 8-K filed January 9, 2023 (File No. 001-34991)).](https://www.sec.gov/Archives/edgar/data/1389170/000119312523004859/d425918dex42.htm) |

| 10.18 | | [Registration Rights Agreement dated as of January 17, 2019 among the Issuers, the Guarantors and Merrill Lynch, Pierce, Fenner & Smith Incorporated, as representative of the several Initial Purchasers party thereto (incorporated by](https://www.sec.gov/Archives/edgar/data/1379661/000119312519014870/d689562dex42.htm) |

| 22.1* | | [List of Subsidiary Guarantors.](https://www.sec.gov/Archives/edgar/data/1389170/000095017023003797/trgp-ex22_1.htm) |

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| 10.67* | | [Supplemental Indenture dated November 30, 2021 to Indenture dated November 27, 2019, among the Guaranteeing Subsidiary, Targa Resources Partners LP, Targa Resources Partners Finance Corporation, the other Subsidiary Guarantors and U.S. Bank National Association.](https://www.sec.gov/Archives/edgar/data/1389170/000156459022006563/trgp-ex1067_72.htm) |

| 10.68* | | [Supplemental Indenture dated January 28, 2022 to Indenture dated November 27, 2019, among the Guaranteeing Subsidiary, Targa Resources Partners LP, Targa Resources Partners Finance Corporation, the other Subsidiary Guarantors and U.S. Bank National Association.](https://www.sec.gov/Archives/edgar/data/1389170/000156459022006563/trgp-ex1068_128.htm) |

| 10.73* | | [Supplemental Indenture dated November 30, 2021 to Indenture dated August 18, 2020, among the Guaranteeing Subsidiary, Targa Resources Partners LP, Targa Resources Partners Finance Corporation, the other Subsidiary Guarantors and U.S. Bank National Association.](https://www.sec.gov/Archives/edgar/data/1389170/000156459022006563/trgp-ex1073_73.htm) |

| 10.74* | | [Supplemental Indenture dated January 28, 2022 to Indenture dated August 18, 2020, among the Guaranteeing Subsidiary, Targa Resources Partners LP, Targa Resources Partners Finance Corporation, the other Subsidiary Guarantors and U.S. Bank National Association.](https://www.sec.gov/Archives/edgar/data/1389170/000156459022006563/trgp-ex1074_127.htm) |

| 10.77 | | [Registration Rights Agreement dated as of February 2, 2021 among the Issuers, the Guarantors and BofA Securities, Inc., as representative of the several Initial Purchasers party thereto (incorporated by reference to Exhibit 4.2 to Targa Resources Partners LP’s Current Report on Form 8-K (File No. 001-3303) filed February 5, 2021).](http://www.sec.gov/Archives/edgar/data/1379661/000119312521030653/d112943dex42.htm) |

| 10.79* | | [Supplemental Indenture dated November 30, 2021 to Indenture dated February 2, 2021, among the Guaranteeing Subsidiary, Targa Resources Partners LP, Targa Resources Partners Finance Corporation, the other Subsidiary Guarantors and U.S. Bank National Association.](https://www.sec.gov/Archives/edgar/data/1389170/000156459022006563/trgp-ex1079_71.htm) |

| 10.80* | | [Supplemental Indenture dated January 28, 2022 to Indenture dated February 2, 2021, among the Guaranteeing Subsidiary, Targa Resources Partners LP, Targa Resources Partners Finance Corporation, the other Subsidiary Guarantors and U.S. Bank National Association.](https://www.sec.gov/Archives/edgar/data/1389170/000156459022006563/trgp-ex1080_126.htm) |

| --- | --- |

| | [removed: Targa] [added: Targa] Resources [removed: Corp.] [added: Corp.] | | |

| Date: February [removed: 24, 2022] [added: 22, 2023] | By: | | [removed: /s/] [added: */s/] Jennifer R. [removed: Kneale] [added: Kneale*] |

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed by the following persons on behalf of the registrant and in the capacities indicated on February [removed: 24, 2022.][added: 22, 2023.]

| [removed: Signature] [added: Signature] | | [removed: Title] [added: Title] (Position with Targa Resources [removed: Corp.)] [added: Corp.)] |

| [removed: /s/] [added: */s/] Matthew J. [removed: Meloy] [added: Meloy*] | | Chief Executive Officer and Director |

| [removed: /s/] [added: */s/] Jennifer R. [removed: Kneale] [added: Kneale*] | | Chief Financial Officer |

| [removed: /s/] [added: */s/] Julie H. [removed: Boushka] [added: Boushka*] | | Senior Vice President and Chief Accounting Officer |

| [removed: /s/] [added: */s/] Paul W. [removed: Chung] [added: Chung*] | | Chairman of the Board and Director |

| [removed: /s/] [added: */s/] Beth A. [removed: Bowman] [added: Bowman*] | | Director |

| [removed: /s/] [added: */s/] Lindsey M. [removed: Cooksen] [added: Cooksen*] | | Director |

| [removed: /s/] [added: */s/] Charles R. [removed: Crisp] [added: Crisp*] | | Director |

| [removed: /s/] [added: */s/] Waters S. Davis, [removed: IV] [added: IV*] | | Director |

| [removed: /s/] [added: */s/] Robert B. [removed: Evans] [added: Evans*] | | Director |

| [removed: /s/] [added: */s/] Laura C. [removed: Fulton] [added: Fulton*] | | Director |

[removed: INDEX] [added: INDEX] TO CONSOLIDATED FINANCIAL [removed: STATEMENTS][added: STATEMENTS]

[removed: TARGA] [added: TARGA] RESOURCES CORP. AUDITED CONSOLIDATED FINANCIAL [removed: STATEMENTS][added: STATEMENTS]

| [Consolidated Balance Sheets as of December 31, [removed: 2021] [added: 2022] and December 31, [removed: 2020](#CONSOLIDATED_BALANCE_SHEETS)] [added: 2021](#consolidated_balance_sheets)] | [removed: F-5] [added: F-6] |

| [Consolidated Statements of Operations for the Years Ended December 31, [added: 2022,] 2021, [removed: 2020,] and [removed: 2019](#CONSOLIDATED_STATEMENTS_OPERATIONS)] [added: 2020](#consolidated_statements_operations)] | [removed: F-6] [added: F-7] |

| [Consolidated Statements of Comprehensive Income (Loss) for the Years Ended December 31, [removed: 2021, 2020] [added: 2022, 2021] and [removed: 2019](#CONSOLIDATED_STATEMENTS_COMPREHENSIVE_IN)] [added: 2020](#consolidated_statements_comprehensive_in)] | [removed: F-7] [added: F-8] |

| [Consolidated Statements of Changes in Owners' Equity and Series A Preferred Stock for the Years Ended December 31, [removed: 2021, 2020] [added: 2022, 2021] and [removed: 2019](#CONSOLIDATED_STATEMENTS_CHANGES_IN_OWNER)] [added: 2020](#consolidated_statements_changes_in_owner)] | [removed: F-8] [added: F-9] |

| [Consolidated Statements of Cash Flows for the Years Ended December 31, [removed: 2021, 2020] [added: 2022, 2021] and [removed: 2019](#CONSOLIDATED_STATEMENTS_CASH_FLOWS)] [added: 2020](#consolidated_statements_cash_flows)] | [removed: F-10] [added: F-11] |

| [Notes to Consolidated Financial [removed: Statements](#NOTES_TO_CONSOLIDATED_FINANCIAL_STATEMEN)] [added: Statements](#notes_to_consolidated_financial_statemen)] | [removed: F-11] [added: F-12] |

| [Note 1 ― Organization and [removed: Operations](#NOTE_1_ORGANIZATION_OPERATIONS)] [added: Operations](#note_1_organization_operations)] | [removed: F-11] [added: F-12] |

| [Note 2 ― Basis of [removed: Presentation](#NOTE_2_BASIS_PRESENTATION)] [added: Presentation](#note_2_basis_presentation)] | [removed: F-11] [added: F-12] |

| [Note 3 ― Significant Accounting [removed: Policies](#NOTE_3_SIGNIFICANT_ACCOUNTING_POLICIES)] [added: Policies](#note_3_significant_accounting_policies)] | [removed: F-11] [added: F-12] |

| [Note 4 ― [removed: Joint Ventures] [added: Acquisitions] and [removed: Divestitures](#NOTE_4_NEWLYFORMED_JOINT_VENTURES_ACQUIS)] [added: Divestitures](#note_4_newlyformed_joint_ventures_acquis)] | [removed: F-18] [added: F-20] |

| [Note 5 ― Property, Plant and Equipment and Intangible [removed: Assets](#NOTE_6_PROPERTY_PLANT_EQUIPMENT_INTANGIB)] [added: Assets](#note_6_property_plant_equipment_intangib)] | [removed: F-21] [added: F-23] |

| [Note 6 ― [removed: Goodwill](#NOTE_7_GOODWILL)] [added: Goodwill](#note_7_goodwill)] | [removed: F-23] [added: F-24] |

| [Note 7 ― Investment in Unconsolidated [removed: Affiliates](#NOTE_8_INVESTMENTS_IN_UNCONSOLIDATED_AFF)] [added: Affiliates](#note_8_investments_in_unconsolidated_aff)] | [removed: F-24] [added: F-25] |

| [Note 8 ― Debt [removed: Obligations](#NOTE_10_DEBT_OBLIGATIONS)] [added: Obligations](#note_10_debt_obligations)] | [removed: F-25] [added: F-27] |

| [Note 9 ― Other Long-term [removed: Liabilities](#NOTE_11_OTHER_LONGTERM_LIABILITIES)] [added: Liabilities](#note_11_other_longterm_liabilities)] | [removed: F-31] [added: F-32] |

| [Note 10 ― [removed: Leases](#NOTE_12_LEASES)] [added: Leases](#note_12_leases)] | [removed: F-32] [added: F-34] |

| [Note 11 ― Preferred [removed: Stock](#NOTE_13_PREFERRED_STOCK)] [added: Stock](#note_13_preferred_stock)] | [removed: F-33] [added: F-35] |

| [Note 12 ― Common Stock and Related [removed: Matters](#NOTE_14_COMMON_STOCK_RELATED_MATTERS)] [added: Matters](#note_14_common_stock_related_matters)] | [removed: F-34] [added: F-36] |

| [Note [removed: 14] [added: 13] ― Earnings Per Common [removed: Share](#NOTE_16_EARNINGS_PER_COMMON_SHARE)] [added: Share](#note_16_earnings_per_common_share)] | [removed: F-36] [added: F-37] |

| [Note [removed: 15] [added: 14] ― Derivative Instruments and Hedging [removed: Activities](#NOTE_17_DERIVATIVE_INSTRUMENTS_HEDGING_A)] [added: Activities](#note_17_derivative_instruments_hedging_a)] | [removed: F-36] [added: F-37] |

| [Note [removed: 16] [added: 15] ― Fair Value [removed: Measurements](#NOTE_18_FAIR_VALUE_MEASUREMENTS)] [added: Measurements](#note_18_fair_value_measurements)] | [removed: F-39] [added: F-40] |

| [Note [removed: 17] [added: 16] ― Related Party [removed: Transactions](#NOTE_19_RELATED_PARTY_TRANSACTIONS)] [added: Transactions](#note_19_related_party_transactions)] | [removed: F-41] [added: F-42] |