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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549 
___________________________________________
FORM 10-Q
 ___________________________________________
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 2021
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from                     to                    
Commission file number: 001-33292
_________________________________________________________
corr-20210630_g1.jpg
CORENERGY INFRASTRUCTURE TRUST, INC.
______________________________________________________________________
(Exact name of registrant as specified in its charter)
Maryland20-3431375
(State or other jurisdiction of incorporation or organization)(IRS Employer Identification No.)
1100 Walnut, Ste. 3350Kansas City,MO64106
(Address of Registrant's Principal Executive Offices)(Zip Code)
(816) 875-3705
(Registrant's telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
Title of Each ClassTrading Symbol(s)Name of Each Exchange On Which Registered
Common Stock, par value $0.001 per shareCORRNew York Stock Exchange
7.375% Series A Cumulative Redeemable Preferred StockCORRPrANew York Stock Exchange
___________________________________________
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes      No   
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).     Yes      No   
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.
Large accelerated filer
Accelerated filer
Non-accelerated filerSmaller reporting company
Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act)     Yes      No  
As of August 2, 2021, the registrant had 14,830,570 common shares outstanding.



CorEnergy Infrastructure Trust, Inc.
FORM 10-Q
FOR THE QUARTER ENDED June 30, 2021
TABLE OF CONTENTS
____________________________________________________________________________________________
Page No.

2


This Report on Form 10-Q ("Report") should be read in its entirety. No one section of the Report deals with all aspects of the subject matter. It should be read in conjunction with the consolidated financial statements, related notes, and with the Management's Discussion & Analysis ("MD&A") included within, as well as provided in the Annual Report on Form 10-K, for the year ended December 31, 2020.

The consolidated unaudited financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information, the instructions to Form 10-Q, and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and notes required by generally accepted accounting principles for complete financial statements. In the opinion of Management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three and six months ended June 30, 2021 are not necessarily indicative of the results that may be expected for the year ended December 31, 2021 or for any other interim or annual period. For further information, refer to the consolidated financial statements and footnotes thereto included in the CorEnergy Infrastructure Trust, Inc. Annual Report on Form 10-K, for the year ended December 31, 2020.

3

GLOSSARY OF DEFINED TERMS
Certain of the defined terms used in this Report as set forth below:
5.875% Convertible Notes: the Company's 5.875% Convertible Senior Notes due 2025.
7.00% Convertible Notes: the Company's 7.00% Convertible Senior Notes due 2020, which matured on June 15, 2020.
Accretion Expense: the expense recognized when adjusting the present value of the GIGS ARO for the passage of time.
Administrative Agreement: the Administrative Agreement dated December 1, 2011, as amended effective August 7, 2012, between the Company and Corridor.
ARO: the Asset Retirement Obligation liabilities assumed with the acquisition of GIGS and disposed of with the sale of GIGS effective February 1, 2021.
ASC: FASB Accounting Standards Codification.
ASU: FASB Accounting Standard Update.
Bbls: standard barrel containing 42 U.S. gallons.
bpd: Barrels per day.
CARES Act: the Coronavirus Aid, Relief, and Economic Security Act.
Cash Available for Distribution or CAD: the Company's earnings before interest, taxes, depreciation and amortization, less (i) cash interest expense, (ii) preferred dividends, (iii) regularly scheduled debt amortization, (iv) maintenance capital expenditures, (v) reinvestment allocation and plus or minus other adjustments but excluding the impact of extraordinary or nonrecurring expenses unrelated to the operations of Crimson Midstream Holdings, LLC and all of its subsidiaries, as defined in the Articles Supplementary for the Class B Common Stock and effective beginning with the quarter ending June 30, 2021.
Class B Common Stock: the Company's Class B Common Stock, par value $0.001 per share.
Code: the Internal Revenue Code of 1986, as amended.
Common Stock: the Company's Common Stock, par value $0.001 per share.
Company or CorEnergy: CorEnergy Infrastructure Trust, Inc. (NYSE: CORR).
Compass SWD: Compass SWD, LLC, the current borrower under the Compass REIT Loan.
Compass REIT Loan: the financing notes between Compass SWD and Four Wood Corridor.
Convertible Notes: collectively, the Company's 5.875% Convertible Notes and the Company's 7.00% Convertible Notes.
CorEnergy Credit Facility: the Company's upsized $160.0 million CorEnergy Revolver and the $1.0 million MoGas Revolver with Regions Bank, which was terminated on February 4, 2021 in connection with the Crimson Transaction.
CorEnergy Revolver: the Company's $160.0 million secured revolving line of credit facility with Regions Bank, which was terminated on February 4, 2021 in connection with the Crimson Transaction.
Corridor: Corridor InfraTrust Management, LLC, the Company's external manager pursuant to the Management Agreement.
Corridor MoGas: Corridor MoGas, Inc., a wholly-owned taxable REIT subsidiary of CorEnergy, the holding company of MoGas, United Property Systems and CorEnergy Pipeline Company, LLC and a co-borrower under the Crimson Credit Facility.
Corridor Private: Corridor Private Holdings, Inc., an indirect wholly-owned taxable REIT subsidiary of CorEnergy.
COVID-19: Coronavirus disease of 2019; a pandemic affecting many countries globally.
Cox Acquiring Entity: MLCJR LLC, an affiliate of Cox Oil, LLC.
Cox Oil: Cox Oil, LLC.
4

GLOSSARY OF DEFINED TERMS (Continued from previous page)
CPI: Consumer Price Index.
CPUC: California Public Utility Commission.
Crimson: Crimson Midstream Holdings, LLC, a CPUC regulated crude oil pipeline owner and operator, of which the Company owns a 49.50 percent interest effective February 1, 2021.
Crimson Credit Facility: the Amended and Restated Credit Agreement with Crimson Midstream Operating and Corridor MoGas as co-borrowers, the lenders from time to time party thereto, and Wells Fargo Bank, National Association, as administrative agent, swingline lender and issuing bank, entered into on February 4, 2021, which provides borrowing capacity of up to $155.0 million, consisting of: a $50.0 million revolving credit facility, an $80.0 million term loan and an uncommitted incremental facility of $25.0 million.
Crimson Midstream Operating: Crimson Midstream Operating, LLC, a wholly-owned subsidiary of Crimson and a co-borrower under the Crimson Credit Facility.
Crimson Revolver: the $50.0 million secured revolving line of credit facility with Wells Fargo Bank, National Association entered into on February 4, 2021.
Crimson Term Loan: the $80.0 million secured term loan with Wells Fargo Bank, National Association entered into on February 4, 2021.
Crimson Transaction: the Company's acquisition of a 49.50 percent interest in Crimson effective February 1, 2021 with the right to acquire the remaining 50.50 percent interest upon receiving CPUC approval.
Exchange Act: the Securities Exchange Act of 1934, as amended.
EGC: Energy XXI Ltd, the parent company (and guarantor) of our tenant on the Grand Isle Gathering System lease, emerged from a reorganization under Chapter 11 of the US Bankruptcy Code on December 30, 2016, with the succeeding company named Energy XXI Gulf Coast, Inc. Effective October 18, 2018, EGC became an indirect wholly-owned subsidiary of MLCJR LLC ("Cox Acquiring Entity"), an affiliate of Cox Oil, LLC, as a result of a merger transaction. Throughout this document, references to EGC will refer to both the pre- and post-bankruptcy entities and, for dates on and after October 18, 2018, to EGC as an indirect wholly-owned subsidiary of the Cox Acquiring Entity.
EGC Tenant: Energy XXI GIGS Services, LLC, a wholly-owned operating subsidiary of Energy XXI Gulf Coast, Inc. that was the tenant under Grand Isle Corridor's triple-net lease of the Grand Isle Gathering System until the lease was terminated on February 4, 2021.
FASB: Financial Accounting Standards Board.
FERC: Federal Energy Regulatory Commission.
Four Wood Corridor: Four Wood Corridor, LLC, a wholly-owned subsidiary of CorEnergy.
GAAP: U.S. generally accepted accounting principles.
GIGS: the Grand Isle Gathering System, owned by Grand Isle Corridor LP and triple-net leased to a wholly-owned subsidiary of Energy XXI Gulf Coast, Inc until it was disposed of as partial consideration in connection with the Crimson Transaction effective February 1, 2021.
Grand Isle Corridor: Grand Isle Corridor, LP, an indirect wholly-owned subsidiary of the Company.
Grand Isle Gathering System: a subsea midstream pipeline gathering system located in the shallow Gulf of Mexico shelf and storage and onshore processing facilities.
Grand Isle Lease Agreement: the June 2015 agreement pursuant to which the Grand Isle Gathering System assets were triple-net leased to EGC Tenant, which terminated on February 4, 2021 upon disposal of GIGS.
Grier Members: Mr. John D. Grier, Mrs. M. Bridget Grier and certain affiliated trusts of Grier, which collectively own a 50.50 percent interest in Crimson, which is reflected as a non-controlling interest in the Company's financial statements.
Indenture: that certain Base Indenture, dated August 12, 2019, between the Company and U.S. Bank National Association, as Trustee for the 5.875% Convertible Notes.
5

GLOSSARY OF DEFINED TERMS (Continued from previous page)
Internalization: CorEnergy's expected acquisition of its external manager, Corridor, as contemplated in a Contribution Agreement, as described in this Report.
IRS: Internal Revenue Service.
Lightfoot: collectively, Lightfoot Capital Partners LP and Lightfoot Capital Partners GP LLC.
Management Agreement: the current management agreement between the Company and Corridor entered into May 8, 2015, effective as of May 1, 2015, and as amended February 4, 2021.
MoGas: MoGas Pipeline LLC, an indirect wholly-owned subsidiary of CorEnergy.
MoGas Pipeline System: an approximately 263-mile interstate natural gas pipeline system in and around St. Louis and extending into central Missouri, owned and operated by MoGas.
MoGas Revolver: a $1.0 million secured revolving line of credit facility at the MoGas subsidiary level with Regions Bank, which was terminated on February 4, 2021 in connection with the Crimson Transaction.
Mowood: Mowood, LLC, an indirect wholly-owned subsidiary of CorEnergy and the holding company of Omega Pipeline Company, LLC.
Mowood/Omega Revolver: a $1.5 million revolving line of credit facility at the Mowood subsidiary level with Regions Bank, which was terminated on February 4, 2021 in connection with the Crimson Transaction.
NAREIT: National Association of Real Estate Investment Trusts.
NYSE: New York Stock Exchange.
Omega: Omega Pipeline Company, LLC, a wholly-owned subsidiary of Mowood, LLC.
Omega Pipeline: Omega's natural gas distribution system in south central Missouri.
OPEC: the Organization of the Petroleum Exporting Countries.
Pipeline Loss Allowance (or PLA): the portion of crude oil provided by or on behalf of each shipper, at no cost to the carrier, (as allowance for losses sustained due to evaporation, measurement and other losses in transit) and retained by the carrier in recognition of loss and shrinkage in carrier's system.
Pinedale LGS: the Pinedale Liquids Gathering System, a system consisting of approximately 150 miles of pipelines and four above-ground central gathering facilities located in the Pinedale Anticline in Wyoming, owned by Pinedale LP and triple-net leased to a wholly-owned subsidiary of Ultra Petroleum until it was sold on June 30, 2020.
Pinedale Lease Agreement: the December 2012 agreement pursuant to which the Pinedale LGS assets were triple-net leased to a wholly owned subsidiary of Ultra Petroleum, which terminated on June 30, 2020 upon sale of the Pinedale LGS.
Pinedale LP: Pinedale Corridor, LP, an indirect wholly-owned subsidiary of CorEnergy.
Pinedale GP: the general partner of Pinedale LP and a wholly-owned subsidiary of CorEnergy.
PLR: the Private Letter Ruling dated November 16, 2018 (PLR 201907001) issued to CorEnergy by the IRS.
REIT: real estate investment trust.
SEC: Securities and Exchange Commission.
Securities Act: the Securities Act of 1933, as amended.
Series A Preferred Stock: the Company's 7.375% Series A Cumulative Redeemable Preferred Stock, par value $0.001 per share, of which there currently are outstanding approximately 50,108 shares represented by 5,010,814 depositary shares, each representing 1/100th of a whole share of Series A Preferred Stock.
TRS: taxable REIT subsidiary.
UPL: Ultra Petroleum Corp.
6

GLOSSARY OF DEFINED TERMS (Continued from previous page)
Ultra Wyoming: Ultra Wyoming LGS LLC, an indirect wholly-owned subsidiary of Ultra Petroleum.
United Property Systems: United Property Systems, LLC, an indirect wholly-owned subsidiary of CorEnergy, acquired with the MoGas transaction in November 2014.
VIE: variable interest entity.

7


CAUTIONARY STATEMENT CONCERNING FORWARD-LOOKING STATEMENTS
Certain statements included or incorporated by reference in this Quarterly Report on Form 10-Q ("Report") may be deemed "forward-looking statements" within the meaning of the federal securities laws. In many cases, these forward-looking statements may be identified by the use of words such as "will," "may," "should," "could," "believes," "expects," "anticipates," "estimates," "intends," "projects," "goals," "objectives," "targets," "predicts," "plans," "seeks," or similar expressions. Any forward-looking statement speaks only as of the date on which it is made and is qualified in its entirety by reference to the factors discussed throughout this Report.
Although we believe the expectations reflected in any forward-looking statements are based on reasonable assumptions, forward-looking statements are not guarantees of future performance or results and we can give no assurance that these expectations will be attained. Our actual results may differ materially from those indicated by these forward-looking statements due to a variety of known and unknown risks and uncertainties. You should also understand that it is not possible to predict or identify all such factors and should not consider the following list to be a complete statement of all potential risks and uncertainties. Factors that could cause our actual results to differ materially from the results contemplated by such forward-looking statements include:
changes in economic and business conditions in the energy infrastructure sector where our investments are concentrated, including the financial condition of our customers, tenants or borrowers and general economic conditions in the particular sectors of the energy industry served by each of our infrastructure assets;
pandemics, epidemics or disease outbreaks, such as the COVID-19 pandemic, which may adversely affect local and global economies as well as our or our customers', tenants' or borrowers' business and financial results;
the inherent risks associated with owning real estate, including real estate market conditions, governing laws and regulations, including potential liabilities related to environmental matters, and the relative illiquidity of real estate investments;
competitive and regulatory pressures on the revenues of our California intrastate crude oil transportation business and our interstate natural gas transmission business;
risks associated with the receipt of CPUC approval for the Company to obtain full operational control and majority ownership over Crimson's CPUC regulated pipeline assets;
the impact of environmental, pipeline safety and other laws and governmental regulations applicable to certain of our infrastructure assets, including additional costs imposed on our business or other adverse impacts as a result of any unfavorable changes in such laws or regulations;
risks associated with the bankruptcy or default of any of our customers, tenants or borrowers, including the exercise of the rights and remedies of bankrupt entities;
our continued ability to access the debt and equity markets;
our ability to comply with covenants in instruments governing our indebtedness;
the potential impact of greenhouse gas regulation and climate change on our or our tenants' business, financial condition and results of operations;
Crimson's assets were constructed over many decades, which may increase future inspection, maintenance or repair costs, or result in downtime that could have a material adverse effect on our business and results of operations;
the loss of any member of our management team;
our ability to successfully implement our selective acquisition strategy;
our ability to obtain suitable tenants for leased properties;
our ability to refinance amounts outstanding under our credit facilities and our convertible notes at maturity on terms favorable to us;
changes in interest rates under our current credit facilities and under any additional variable rate debt arrangements that we may enter into in the future;
dependence by us and our tenants on key customers for significant revenues, and the risk of defaults by any such tenants or customers;
our customers' or tenants' ability to secure adequate insurance and risk of potential uninsured losses, including from natural disasters;
8


the continued availability of third-party pipelines, railroads or other facilities interconnected with certain of our infrastructure assets;
risks associated with owning, operating or financing properties for which the tenants', mortgagors' or our operations may be impacted by extreme weather patterns and other natural phenomena;
our ability to sell properties at an attractive price;
market conditions and related price volatility affecting our debt and equity securities;
changes in federal or state tax rules or regulations that could have adverse tax consequences;
our ability to maintain internal controls and processes to ensure all transactions are accounted for properly, all relevant disclosures and filings are timely made in accordance with all rules and regulations, and any potential fraud or embezzlement is thwarted or detected;
changes in federal income tax regulations (and applicable interpretations thereof), or in the composition or performance of our assets, that could impact our ability to continue to qualify as a real estate investment trust for federal income tax purposes;
some of our directors and officers may have conflicts of interest with respect to certain other business interests related to the Crimson Transaction; and
risks related to potential terrorist attacks, acts of cyber-terrorism, or similar disruptions that could disrupt access to our information technology systems or result in other significant damage to our business and properties, some of which may not be covered by insurance and all of which could adversely impact distributions to our stockholders.
Forward-looking statements speak only as of the date on which they are made. While we may update these statements from time to time, we are not required to do so other than pursuant to applicable laws. For a further discussion of these and other factors that could impact our future results and performance, see Part I, Item 1A, "Risk Factors" in our Annual Report on Form 10-K for the year ended December 31, 2020, filed with the SEC on March 4, 2021, and Part II, Item 1A, "Risk Factors", in this Report.
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PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
corr-20210630_g1.jpg
CorEnergy Infrastructure Trust, Inc.
CONSOLIDATED BALANCE SHEETS
June 30, 2021December 31, 2020
Assets(Unaudited)
Property and equipment, net of accumulated depreciation of $28,973,654 and $22,580,810 (Crimson VIE: $338,930,724, and $0, respectively)
$443,457,382 $106,224,598 
Leased property, net of accumulated depreciation of $237,579 and $6,832,167
1,288,449 64,938,010 
Financing notes and related accrued interest receivable, net of reserve of $600,000 and $600,000
1,149,245 1,209,736 
Cash and cash equivalents (Crimson VIE: $2,989,319 and $0, respectively)
17,695,458 99,596,907 
Accounts and other receivables (Crimson VIE: $11,434,113 and $0, respectively)
14,389,085 3,675,977 
Due from affiliated companies (Crimson VIE: $1,154,499 and $0, respectively)
1,163,633  
Deferred costs, net of accumulated amortization of $155,353 and $2,130,334
986,994 1,077,883 
Inventory (Crimson VIE: $1,512,398 and $0, respectively)
1,625,464 87,940 
Prepaid expenses and other assets (Crimson VIE: $4,018,467 and $0, respectively)
10,939,625 2,054,804 
Operating right-of-use assets (Crimson VIE: $5,844,591 and $0, respectively)
5,914,710 85,879 
Deferred tax asset, net4,173,754 4,282,576 
Goodwill1,718,868 1,718,868 
Total Assets$504,502,667 $284,953,178 
Liabilities and Equity
Secured credit facilities, net of debt issuance costs of $1,580,091 and $0
$104,419,909 $ 
Unsecured convertible senior notes, net of discount and debt issuance costs of $2,713,020 and $3,041,870
115,336,979 115,008,130 
Asset retirement obligation 8,762,579 
Accounts payable and other accrued liabilities (Crimson VIE: $11,454,583 and $0, respectively)
20,780,331 4,628,847 
Management fees payable304,770 971,626 
Due to affiliated companies (Crimson VIE: $970,469 and $0, respectively)
979,603  
Operating lease liability (Crimson VIE: $5,609,946 and $0, respectively)
5,651,002 56,441 
Unearned revenue (Crimson VIE $315,000 and $0, respectively)
6,147,990 6,125,728 
Total Liabilities$253,620,584 $135,553,351 
Commitments and Contingencies (Note 10)
Equity
Series A Cumulative Redeemable Preferred Stock 7.375%, $125,270,350 and $125,270,350 liquidation preference ($2,500 per share, $0.001 par value), 10,000,000 authorized; 50,108 and 50,108 issued and outstanding at June 30, 2021 and December 31, 2020, respectively
$125,270,350 $125,270,350 
Common stock, non-convertible, $0.001 par value; 13,673,326 and 13,651,521 shares issued and outstanding at June 30, 2021 and December 31, 2020, respectively (100,000,000 shares authorized)
13,673 13,652 
Additional paid-in capital333,890,657 339,742,380 
Retained deficit(327,513,586)(315,626,555)
Total CorEnergy Equity131,661,094 149,399,827 
Non-controlling interest (Crimson)119,220,989  
Total Equity250,882,083 149,399,827 
Total Liabilities and Equity$504,502,667 $284,953,178 
Variable Interest Entity (VIE) (Note 15)
See accompanying Notes to Consolidated Financial Statements.
10


corr-20210630_g1.jpg
CorEnergy Infrastructure Trust, Inc.
CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
For the Three Months EndedFor the Six Months Ended
June 30, 2021June 30, 2020June 30, 2021June 30, 2020
Revenue
Transportation and distribution revenue$28,100,343 $4,382,706 $49,395,482 $9,583,206 
Pipeline loss allowance subsequent sales2,915,533  3,991,255  
Lease revenue701,525 5,554,368 1,176,000 21,300,872 
Deferred rent receivable write-off   (30,105,820)
Other revenue579,177 29,913 774,339 56,220 
Total Revenue32,296,578 9,966,987 55,337,076 834,478 
Expenses
Transportation and distribution expenses15,363,410 1,222,135 25,706,007 2,597,364 
Pipeline loss allowance subsequent sales cost of revenue2,223,646  3,172,502  
General and administrative5,381,654 4,325,924 15,218,447 7,402,067 
Depreciation, amortization and ARO accretion expense3,748,453 3,662,926 6,646,783 9,309,993 
Loss on impairment of leased property   140,268,379 
Loss on impairment and disposal of leased property 146,537,547 5,811,779 146,537,547 
Loss on termination of lease 458,297 165,644 458,297 
Total Expenses26,717,163 156,206,829 56,721,162 306,573,647 
Operating Income (Loss)$5,579,415 $(146,239,842)$(1,384,086)$(305,739,169)
Other Income (Expense)
Other income$299,293 $102,038 $362,819 $419,858 
Interest expense(3,295,703)(2,920,424)(6,226,710)(5,806,007)
Gain (loss) on extinguishment of debt 11,549,968 (861,814)11,549,968 
Total Other Income (Expense)(2,996,410)8,731,582 (6,725,705)6,163,819 
Income (Loss) before income taxes2,583,005 (137,508,260)(8,109,791)(299,575,350)
Taxes
Current tax expense (benefit)20,374 (2,431)48,241 (397,074)
Deferred tax expense (benefit)135,222 (71,396)108,822 298,525 
Income tax expense (benefit), net155,596 (73,827)157,063 (98,549)
Net Income (Loss)2,427,409 (137,434,433)(8,266,854)(299,476,801)
Less: Net income attributable to non-controlling interest2,014,870  3,620,178  
Net Income (Loss) attributable to CorEnergy Stockholders$412,539 $(137,434,433)$(11,887,032)$(299,476,801)
Preferred dividend requirements2,309,672 2,309,672 4,619,344 4,570,465 
Net loss attributable to Common Stockholders$(1,897,133)$(139,744,105)$(16,506,376)$(304,047,266)
Loss Per Common Share:
Basic$(0.14)$(10.24)$(1.21)$(22.27)
Diluted$(0.14)$(10.24)$(1.21)$(22.27)
Weighted Average Shares of Common Stock Outstanding:
Basic13,659,667 13,651,521 13,655,617 13,649,907 
Diluted13,659,667 13,651,521 13,655,617 13,649,907 
Dividends declared per share$0.050 $0.050 $0.050 $0.800 
See accompanying Notes to Consolidated Financial Statements.
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corr-20210630_g1.jpg
CorEnergy Infrastructure Trust, Inc.
CONSOLIDATED STATEMENTS OF EQUITY
Capital StockPreferred StockAdditional
Paid-in
Capital
Retained
Deficit
Total
SharesAmountAmount
Balance at December 31, 201913,638,916 $13,639 $125,493,175 $360,844,497 $(9,611,872)$476,739,439 
Net loss— — — — (162,042,368)(162,042,368)
Series A preferred stock dividends— — — (2,313,780)— (2,313,780)
Preferred stock repurchases(1)
— — (222,825)7,932 52,896 (161,997)
Common Stock dividends— — — (10,238,640)— (10,238,640)
Common Stock issued upon exchange of convertible notes12,605 13 — 419,116 — 419,129 
Balance at March 31, 2020 (Unaudited)13,651,521 $13,652 $125,270,350 $348,719,125 $(171,601,344)$302,401,783 
Net loss— — — — (137,434,433)(137,434,433)
Series A preferred stock dividends— — — (2,309,672)— (2,309,672)
Common Stock dividends— — (682,576)— (682,576)
Balance at June 30, 2020 (Unaudited)13,651,521 $13,652 $125,270,350 $345,726,877 $(309,035,777)$161,975,102 
(1) In connection with the repurchase of Series A Preferred Stock during 2020, the deduction from preferred dividends of $52,896 represents the discount in the repurchase price paid compared to the carrying amount derecognized.

Capital StockPreferred StockAdditional
Paid-in
Capital
Retained
Deficit
Non-controlling InterestTotal
SharesAmountAmount
Balance at December 31, 202013,651,521 $13,652 $125,270,350 $339,742,380 $(315,626,555)$ $149,399,827 
Net income (loss)— — — — (12,299,571)1,605,308 (10,694,263)
Series A preferred stock dividends— — — (2,309,672)— — (2,309,672)
Common Stock dividends— — — (682,576)— — (682,576)
Equity attributable to non-controlling interest (Note 3)— — — — — 115,323,036 115,323,036 
Balance at March 31, 2021 (Unaudited)13,651,521 $13,652 $125,270,350 $336,750,132 $(327,926,126)$116,928,344 $251,036,352 
Net income— — — — 412,539 2,014,870 2,427,409 
Series A preferred stock dividends— — — (2,309,672)— — (2,309,672)
Common Stock dividends— — — (682,576)— — (682,576)
Reinvestment of dividends paid to common stockholders21,805 21 — 132,774 — — 132,795 
Crimson cash distribution on A-1 Units— — — — — (604,951)(604,951)
Crimson A-2 Units dividends payment in kind— — — — — (406,000)(406,000)
Equity attributable to non-controlling interest— — — — — 1,288,726 1,288,726 
Balance at June 30, 2021 (Unaudited)13,673,326 $13,673 $125,270,350 $333,890,658 $(327,513,587)$119,220,989 $250,882,083 
See accompanying Notes to Consolidated Financial Statements.
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corr-20210630_g1.jpg
CorEnergy Infrastructure Trust, Inc.
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
For the Six Months Ended
June 30, 2021June 30, 2020
Operating Activities
Net loss$(8,266,854)$(299,476,801)
Adjustments to reconcile net loss to net cash provided by operating activities:
Deferred income tax, net108,822 298,525 
Depreciation, amortization and ARO accretion7,427,544 9,963,908 
Loss on impairment of leased property 140,268,379 
Loss on impairment and disposal of leased property5,811,779 146,537,547 
Loss on termination of lease165,644 458,297 
Deferred rent receivable write-off, noncash 30,105,820 
(Gain) loss on extinguishment of debt861,814 (11,549,968)
Non-cash lease expense 439,246  
Gain on sale of equipment (3,542)
Changes in assets and liabilities:
Deferred rent receivable (247,718)
Accounts and other receivables541,580 1,216,469 
Financing note accrued interest receivable(9,926)(4,671)
Inventory 144,113  
Prepaid expenses and other assets(2,788,545)85,197 
Due from affiliated companies, net(184,030) 
Management fee payable(666,856)(8,299)
Accounts payable and other accrued liabilities1,740,265 (613,391)
Operating lease liability (673,516) 
Unearned revenue(292,738)(607,951)
Net cash provided by operating activities$4,358,342 $16,421,801 
Investing Activities
Acquisition of Crimson Midstream Holdings, net of cash acquired(69,002,053) 
Purchases of property and equipment, net(9,275,334)(85,144)
Proceeds from sale of property and equipment79,600 7,500 
Proceeds from insurance recovery 60,153  
Principal payment on financing note receivable70,417 43,333 
Net cash used in investing activities$(78,067,217)$(34,311)
Financing Activities
Debt financing costs(2,735,922) 
Repurchases of Series A preferred stock (161,997)
Dividends paid on Series A preferred stock(4,619,344)(4,623,452)
Dividends paid on Common Stock(1,232,357)(10,921,216)
Cash paid for extinguishment of convertible notes (1,676,000)
Cash paid for maturity of convertible notes (1,316,250)
Cash paid for settlement of Pinedale Secured Credit Facility (3,074,572)
Distributions to non-controlling interest(604,951) 
Advances on revolving line of credit8,000,000  
Payments on revolving line of credit(7,000,000) 
Principal payments on secured credit facilities (1,764,000)
Net cash used in financing activities$(8,192,574)$(23,537,487)
Net change in Cash and Cash Equivalents$(81,901,449)$(7,149,997)
Cash and Cash Equivalents at beginning of period99,596,907 120,863,643 
Cash and Cash Equivalents at end of period$17,695,458 $113,713,646 
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For the Six Months Ended
June 30, 2021June 30, 2020
Supplemental Disclosure of Cash Flow Information
Interest paid$5,750,876 $5,392,894 
Income taxes paid (net of refunds)(1,286)(466,407)
Non-Cash Investing Activities
Proceeds from sale of leased property provided directly to secured lender$ $18,000,000 
In-kind consideration for the Grand Isle Gathering System provided as partial consideration for the Crimson Midstream Holdings acquisition $48,873,169 $ 
Crimson Credit Facility assumed and refinanced in connection with the Crimson Midstream Holdings acquisition 105,000,000  
Equity consideration attributable to non-controlling interest holder in connection with the Crimson Midstream Holdings acquisition 116,205,762  
Purchases of property, plant and equipment in accounts payable and other accrued liabilities 386,009 110,000 
Non-Cash Financing Activities
Change in accounts payable and accrued expenses related to debt financing costs$235,198 $ 
Common Stock issued upon exchange and conversion of convertible notes 419,129 
Proceeds from sale of leased property used in settlement of Pinedale Secured Credit Facility (18,000,000)
Crimson A-2 Units dividends payment in kind406,000 
See accompanying Notes to Consolidated Financial Statements.
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corr-20210630_g1.jpg
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
June 30, 2021
1. INTRODUCTION AND BASIS OF PRESENTATION
Introduction
CorEnergy Infrastructure Trust, Inc. (referred to as "CorEnergy" or "the Company"), was organized as a Maryland corporation and commenced operations on December 8, 2005. The Company's common shares are listed on the New York Stock Exchange ("NYSE") under the symbol "CORR" and its depositary shares representing Series A Preferred Stock are listed on the NYSE under the symbol "CORR PrA".
The Company owns and operates or leases critical energy midstream infrastructure connecting the upstream and downstream sectors within the industry. The Company currently generates revenue from the transportation, via pipeline, of natural gas and crude oil for its customers in Missouri and California. The pipelines are located in areas where it would be difficult to replicate rights of way or transport natural gas or crude oil via non-pipeline alternatives resulting in the Company's assets providing utility-like criticality in the midstream supply chain for its customers. Prior to 2021, the Company focused primarily on entering into long-term triple-net participating leases with energy companies, and also has provided other types of capital, including loans secured by energy infrastructure assets. Over the last twelve months, the Company's asset portfolio has undergone significant changes. The Company divested all of its leased assets including the Grand Isle Gathering System ("GIGS") and Pinedale Liquids Gathering System ("Pinedale LGS"), which are described in this Report.
On February 4, 2021, the Company acquired a 49.50 percent interest in Crimson Midstream Holdings, LLC ("Crimson"), a California Public Utilities Commission ("CPUC") regulated crude oil pipeline owner and operator. The acquired assets include four critical infrastructure pipeline systems spanning approximately 2,000 miles (including 1,300 active miles) across northern, central and southern California, connecting desirable native California crude production to in-state refineries producing state-mandated specialized fuel blends, among other products. This interest was acquired effective February 1, 2021 and is referred to throughout this Report as the "Crimson Transaction." The repositioning of the Company's asset portfolio from a focus on non-operated leased assets to one of owned and operated assets is enabled by its U.S. Internal Revenue Service ("IRS") Private Letter Ruling ("PLR") related to qualifying income for operated assets. As a result, all of the Company's current assets are owned and operated which provides it with an opportunity to grow the business organically using its footprint in addition to making acquisitions. CorEnergy considers its investments in these energy infrastructure assets to be a single business segment and reports them accordingly in its financial statements.
Basis of Presentation and Consolidation

The accompanying consolidated financial statements include CorEnergy accounts and the accounts of its wholly-owned subsidiaries and variable interest entities ("VIEs") for which CorEnergy is the primary beneficiary. The consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles ("GAAP") set forth in the Accounting Standards Codification ("ASC"), as published by the Financial Accounting Standards Board ("FASB"), and with the Securities and Exchange Commission ("SEC") instructions to Form 10-Q, and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. The accompanying consolidated financial statements reflect all adjustments that are, in the opinion of management, necessary for a fair presentation of the Company's financial position, results of operations, and cash flows for the periods presented. There were no adjustments that, in the opinion of management, were not of a normal and recurring nature. All intercompany transactions and balances have been eliminated in consolidation, and the Company's net earnings have been reduced by the portion of net earnings attributable to non-controlling interests, when applicable.
The Company consolidates a VIE when it is the primary beneficiary, which is the party that has both (i) the power to direct the activities that most significantly impact the VIE's economic performance and (ii) through its interests in the VIE, the obligation to absorb losses or the right to receive benefits from the VIE that could potentially be significant to the VIE. In order to determine whether it owns a variable interest in a VIE, the Company performs a qualitative analysis of the entity's design, primary decision makers, key agreements governing the VIE, voting interests and significant activities impacting the VIE's economic performance. The Company continually monitors consolidated VIEs to determine if any events have occurred that could cause the primary beneficiary to change.

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As described above, the Company acquired a 49.50 percent interest in Crimson, which is a legal entity that meets the VIE criteria. As a result of its consolidation analysis more fully described in Note 15 ("Variable Interest Entity"), the Company determined it is the primary beneficiary of Crimson due to its related party relationship with Crimson's 50.50 percent interest holder. Therefore, beginning February 1, 2021, Crimson is consolidated in the Company's consolidated financial statements and the non-controlling interest is presented as a component of equity. Refer to Note 13 ("Stockholders' Equity") for further discussion of the non-controlling interest in Crimson. The consolidated financial statements also include the accounts of any limited partnerships where the Company represents the general partner and, based on all facts and circumstances, controls such limited partnerships, unless the limited partner has substantive participating rights or substantive kick-out rights. Refer to Note 15 ("Variable Interest Entity"), for further discussion of the Company's consolidated VIEs.
Operating results for the three and six months ended June 30, 2021 are not necessarily indicative of the results that may be expected for the year ending December 31, 2021 or any other interim or annual period. These consolidated financial statements and Management's Discussion and Analysis of the Financial Condition and Results of Operations should be read in conjunction with CorEnergy's Annual Report on Form 10-K, for the year ended December 31, 2020, filed with the SEC on March 4, 2021 (the "2020 CorEnergy 10-K").
2. RECENT ACCOUNTING PRONOUNCEMENTS
In June of 2016, the FASB issued ASU 2016-13 "Financial Instruments - Credit Losses" ("ASU 2016-13"), which introduces an approach based on expected losses to estimate credit losses on certain types of financial instruments. The new model, referred to as the current expected credit losses ("CECL model"), will apply to financial assets subject to credit losses and measured at amortized cost, and certain off-balance sheet credit exposures. ASU 2016-13 is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. In November of 2019, the FASB issued ASU 2019-10, Financial Instruments - Credit Losses (Topic 326), Derivatives and Hedging (Topic 815), and Leases (Topic 842) Effective Dates, which deferred the effective dates of these standards for certain entities. Based on the guidance for smaller reporting companies, the effective date of ASU 2016-13 is deferred for the Company until fiscal year 2023 with early adoption permitted, and the Company has elected to defer adoption of this standard.
Although the Company has elected to defer adoption of ASU 2016-13, it will continue to evaluate the potential impact of the standard on its consolidated financial statements. As part of its ongoing assessment work, the Company has completed training on the CECL model and has begun developing policies, processes and internal controls.
In December of 2019, the FASB issued ASU 2019-12, "Simplifying the Accounting for Income Taxes (Topic 740)" ("ASU 2019-12"), which is intended to simplify various aspects related to accounting for income taxes. ASU 2019-12 removes certain exceptions to the general principles in Topic 740 and also clarifies and amends existing guidance to improve consistent application. ASU 2019-12 is effective for fiscal years beginning after December 15, 2020 and interim periods within those fiscal years. The Company adopted ASU 2019-12 as of January 1, 2021, and it did not have a material impact on its consolidated financial statements.
In March of 2020, the FASB issued ASU 2020-04, "Reference Rate Reform (Topic 848)" ("ASU 2020-04"). In response to concerns about structural risks of interbank offered rates including the risk of cessation of the London Interbank Offered Rate (LIBOR), regulators in several jurisdictions around the world have undertaken reference rate reform initiatives to identify alternative reference rates that are more observable and less susceptible to manipulation. The provisions of ASU 2020-04 are elective and apply to all entities, subject to meeting certain criteria, that have debt or hedging contracts, among other contracts, that reference LIBOR or another reference rate expected to be discontinued because of reference rate reform. ASU 2020-04, among other things, provides optional expedients and exceptions for a limited period of time for applying U.S. GAAP to these contracts if certain criteria are met to ease the potential burden in accounting for or recognizing the effects of reference rate reform on financial reporting. ASU 2020-04 is effective for all entities as of March 12, 2020 through December 31, 2022. The Company is currently evaluating its contracts that reference LIBOR and the optional expedients and exceptions provided by the FASB.
In August 2020, the FASB issued ASU 2020-06, "Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity" ("ASU 2020-06"). The new guidance (i) simplifies an issuer's accounting for convertible instruments by eliminating the cash conversion and beneficial conversion feature models in ASC 470-20 that require separate accounting for embedded conversion features, (ii) simplifies the settlement assessment that issuers perform to determine whether a contract in its own equity qualifies for equity classification and (iii) requires entities to use the if-converted method for all convertible instruments and generally requires them to include the effect of share settlement for instruments that may be settled in cash or shares. ASU 2020-06 is effective for fiscal years beginning after December 15, 2021. Early adoption is permitted for fiscal years beginning after December 15, 2020, but an entity must early adopt the guidance at the beginning of the fiscal year. The Company elected to early adopt ASU 2020-6 on January 1, 2021 and noted that the standard does not have an impact on the Company's consolidated financial statements.
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3. ACQUISITION
Crimson Midstream Holdings, LLC

Effective February 1, 2021, the Company completed the acquisition of a 49.50 percent interest in Crimson (which includes a 49.50 percent voting interest and the right to 100.0 percent of the economic benefit of Crimson's business, after satisfying the distribution rights of the remaining equity holders) for total consideration with a fair value of $343.8 million after giving effect to the initial working capital adjustments and with the right to acquire the remaining 50.50 percent, subject to CPUC approval. After giving effect to the initial working capital adjustments, the consideration consisted of a combination of cash on hand of $74.6 million, commitments to issue new common and preferred equity valued at $115.3 million, contribution of the GIGS asset with a fair value of $48.9 million to the sellers and $105.0 million in new term loan and revolver borrowings, all as detailed further below. The consideration was subject to a final working capital adjustment. Crimson is a CPUC regulated crude oil pipeline owner and operator, and its assets include four critical infrastructure pipeline systems spanning approximately 2,000 miles (including 1,300 active miles) across northern, central and southern California, connecting California crude production to in-state refineries.
To effect the Crimson Transaction, on February 4, 2021, the Company entered into and consummated a Membership Interest Purchase Agreement (the "MIPA") with CGI Crimson Holdings, L.L.C. ("Carlyle"), Crimson, and John D. Grier and certain affiliated trusts of Grier (the "Grier Members"). Pursuant to the terms of the MIPA, the Company acquired all of the Class C Units of Crimson owned by Carlyle, which represents 49.50 percent of all of the issued and outstanding membership interests of Crimson for approximately $66.0 million in cash (net of initial working capital adjustments) and the transfer to Carlyle of the Company's interest in GIGS (as further described in Note 5 ("Leased Properties And Leases")). Crimson Midstream Operating and Corridor MoGas also entered into a $105.0 million Amended and Restated Credit Agreement with Wells Fargo (as further described below and in Note 12 ("Debt")).

Simultaneously, Crimson, the Company, and the Grier Members entered into the Third Amended and Restated Limited Liability Company Agreement ("Third LLC Agreement”) of Crimson. Pursuant to the terms of the Third LLC Agreement, the Grier Members' outstanding membership interests in Crimson were exchanged for 1,613,202 Class A-1 Units of Crimson, 2,436,000 Class A-2 Units of Crimson and 2,450,142 Class A- 3 Units of Crimson, which, as described in Note 13 ("Stockholders' Equity"), may eventually be exchangeable for shares of the Company's common and preferred stock. The Company received 10,000 Class B-1 Units, which represent the Company's economic interest in Crimson. The Class A-1 Units issued were subject to a final working capital adjustment. Additionally, 495,000 Class C-1 Units (representing 49.50 percent of the voting interests under the Third LLC Agreement) were issued to the Company in exchange for the former Class C Units acquired from Carlyle and 505,000 Class C-1 Units (representing 50.50 percent of the voting interests under the Third LLC Agreement) were issued to the Grier Members, in exchange for the Class C Units held by the Grier Members prior to the Crimson Transaction.
In June 2021, the final working capital adjustment was made for the Crimson Transaction which resulted in an increase in the assets acquired of $1,790,455. This resulted in an additional 37,043 Class A-1 Units being issued to the Grier Members for their 50.50 percent ownership interest and $907,728 of additional cash being paid for the 49.50 percent ownership interest CorEnergy purchased. The newly issued units resulted in an increase in the aggregate value of non-controlling interest of $882,726 and increased the Grier Members' total Class A-1 Units to 1,650,245.
The acquisition is being treated as a business combination in accordance with ASC 805, Business Combinations, which requires allocation of the purchase price to the estimated fair values of assets and liabilities acquired in the transaction. The allocation of purchase price is based on management's judgment after evaluating several factors, including a preliminary valuation assessment. Because the values assigned to assets acquired and liabilities assumed are based on preliminary estimates of fair value available as of the date of this Quarterly Report on Form 10-Q, amounts may be adjusted during the measurement period of up to twelve months from the date of acquisition as further information becomes available. Any changes in the fair values of assets acquired and liabilities assumed during the measurement period may result in adjustments to goodwill. The allocation of purchase price is preliminary and subject to changes as an appraisal of tangible assets and liabilities are finalized and purchase price adjustments are completed. The following is a summary of a preliminary allocation of the purchase price:



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Crimson Midstream Holdings, LLCAs of February 1, 2021Working Capital ChangesJune 30, 2021
Assets Acquired
Cash and cash equivalents$6,554,921 $ $6,554,921 
Accounts and other receivables11,394,441 — 11,394,441 
Inventory1,681,637 — 1,681,637 
Prepaid expenses and other assets6,144,932 — 6,144,932 
Property and equipment(1)
332,174,531 1,790,455 333,964,986 
Operating right-of-use asset6,268,077 — 6,268,077 
Total assets acquired:$364,218,539 $1,790,455 $366,008,994 
Liabilities Assumed
Accounts payable and other accrued liabilities$13,790,011 $— $13,790,011 
Operating lease liability6,268,077 — 6,268,077 
Unearned revenue315,000 — 315,000 
Total liabilities assumed:$20,373,088 $— $20,373,088 
Fair Value of Net Assets Acquired:
$343,845,451 $1,790,455 $345,635,906 
Non-controlling interest at fair value(2)(3)
$115,323,036 $882,726 $116,205,762 
(1) Amounts recorded for property and equipment include land, buildings, lease assets, leasehold improvements, furniture, fixtures and equipment. During the three months ended June 30, 2021, the Company recorded measurement period adjustments primarily related to the valuation of land.
(2) Includes a non-controlling interest for Grier Members' equity consideration in the A-1, A-2 and A-3 Units (including the 37,043 newly issued A-1 Units) with a total fair value of $116.2 million. Refer to "Fair Value of Non-controlling Interest" below and Note 13 ("Stockholders' Equity") for further details.
(3) In addition to the newly issued Class A-1 Units, CorEnergy also paid $907,728 in cash as a contribution to Crimson Midstream Holdings, LLC.

Fair Value of Assets and Liabilities Acquired

The fair value of property and equipment was determined from an external valuation performed by an unrelated third party specialist based on the cost methodology. The preliminary fair value measurement of tangible assets is based on significant inputs not observable in the market and thus represent Level 3 measurements within the fair value measurement hierarchy. The significant unobservable input used includes a discount rate based on an estimated weighted average cost of capital of a theoretical market participant. The Company utilized a weighted average discount rate of 14.0 percent when deriving the fair value of the property and equipment acquired. The weighted average discount rate reflects management's best estimate of inputs a market participant would utilize. In addition, the Company utilized revenue, cost and growth projections in its discounted cash flows to value the assets and liabilities acquired as well as relevant third-party valuation data for the pipeline right of ways. The carrying value of cash and cash equivalents, accounts and other receivables, prepaid expenses and other assets, and accounts payable and other accrued liabilities, approximate fair value due to their short term, highly liquid nature. Inventory was valued based on average crude oil inventory prices, less an applicable discount to sell, at the acquisition date.

Fair Value of Non-controlling Interest

The fair value of the non-controlling interest for each of the A-1, A-2 and A-3 Units was determined from an external valuation performed by an unrelated third party specialist. As described in Note 13 ("Stockholders' Equity"), the A-1, A-2 and A-3 Units have the right to receive any distributions that the Company's Board of Directors det