Leased Properties and Leases (Tables)
|
12 Months Ended |
Dec. 31, 2017 |
|---|
| Leases [Abstract] |
|
| Significant leased properties, major tenants and lease terms |
The following table summarizes the significant leased properties, major tenants and lease terms:
|
|
|
|
|
Summary of Leased Properties, Major Tenants and Lease Terms |
Property |
Grand Isle Gathering System |
Pinedale LGS(1)
|
Portland Terminal Facility |
Location |
Gulf of Mexico/Louisiana |
Pinedale, WY |
Portland, OR |
Tenant |
Energy XXI GIGS Services, LLC |
Ultra Wyoming LGS, LLC |
Zenith Energy Terminals Holdings LLC |
Asset Description |
Approximately 153 miles of offshore pipeline with total capacity of 120 thousand Bbls/d, including a 16-acre onshore terminal and saltwater disposal system. |
Approximately 150 miles of pipelines and four central storage facilities. |
A 39-acre rail and marine facility property adjacent to the Willamette River with 84 tanks and total storage capacity of approximately 1.5 million barrels. |
Date Acquired |
June 2015 |
December 2012 |
January 2014 |
Initial Lease Term |
11 years |
15 years |
15 years(3)
|
Renewal Option |
Equal to the lesser of 9-years or 75 percent of the remaining useful life |
5-year terms |
5-year terms |
Current Monthly Rent Payments |
7/1/16 - 6/30/17: $2,826,250
7/1/17 - 6/30/18: $2,854,667 |
$1,741,933(2)
|
$513,355 |
Estimated Useful Life |
27 years |
26 years |
30 years |
(1) Non-Controlling Interest Partner, Prudential, funded a portion of the original Pinedale LGS acquisition and, as a limited partner, held 18.95 percent of the economic interest in Pinedale LP. Pinedale LP I, a wholly-owned subsidiary of the Company, acquired Prudential's 18.95 percent economic interest on December 29, 2017. Pinedale GP, a wholly-owned subsidiary of the Company, holds the remaining 81.05 percent economic interest. |
(2) Monthly rent payments increased to $1,776,772 beginning January 1, 2018. |
(3) The lessee of the Portland Terminal Facility has a purchase option beginning in February 2017, which it can exercise with 90-days notice, as well as lease termination options on the fifth and tenth anniversaries of the lease. If exercised, the purchase option and termination options are subject to additional payment provisions and termination fees prescribed under the lease. |
|
| Schedule of future minimum lease receipts |
The future contracted minimum rental receipts for all leases as of December 31, 2017, are as follows:
|
|
|
|
|
Future Minimum Lease Receipts (1)
|
Year Ending December 31, |
Amount |
2018 |
$ |
61,828,029 |
|
2019 |
64,103,462 |
|
2020 |
71,264,921 |
|
2021 |
77,445,396 |
|
2022 |
76,553,434 |
|
Thereafter |
302,242,184 |
|
Total |
$ |
653,437,426 |
|
(1) Future minimum lease receipts include base rents for the Portland Terminal Facility through its initial 15-year term. |
|
| Schedule of Significant Leases |
The table below displays the Company's individually significant leases as a percentage of total leased properties and total lease revenues for the periods presented:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As a Percentage of (1)
|
|
Leased Properties |
|
Lease Revenues |
|
As of December 31, |
|
For the Years Ended December 31, |
|
2017 |
|
2016 |
|
2017 |
|
2016 |
|
2015 |
Pinedale LGS |
39.9 |
% |
|
39.8 |
% |
|
31.2 |
% |
|
30.4 |
% |
|
42.9 |
% |
Grand Isle Gathering System |
49.7 |
% |
|
50.0 |
% |
|
59.1 |
% |
|
59.8 |
% |
|
42.3 |
% |
Portland Terminal Facility |
10.1 |
% |
|
9.9 |
% |
|
9.6 |
% |
|
9.7 |
% |
|
13.3 |
% |
(1) Insignificant leases are not presented; thus percentages may not sum to 100%. |
|
| Schedule of Depreciation, Amortization and Accretion |
The following table reflects the depreciation and amortization included in the accompanying Consolidated Statements of Income associated with the Company's leases and leased properties:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Years Ended December 31, |
|
2017 |
|
2016 |
|
2015 |
Depreciation Expense |
|
|
|
|
|
GIGS |
$ |
9,754,596 |
|
|
$ |
8,605,506 |
|
|
$ |
4,317,769 |
|
Pinedale |
8,869,440 |
|
|
8,869,440 |
|
|
8,869,440 |
|
Portland Terminal Facility |
1,275,660 |
|
|
843,084 |
|
|
1,235,369 |
|
Eastern Interconnect Project |
— |
|
|
— |
|
|
569,670 |
|
United Property Systems |
36,298 |
|
|
32,424 |
|
|
29,700 |
|
Total Depreciation Expense |
$ |
19,935,994 |
|
|
$ |
18,350,454 |
|
|
$ |
15,021,948 |
|
Amortization Expense - Deferred Lease Costs |
|
|
|
|
|
GIGS |
$ |
30,564 |
|
|
$ |
30,564 |
|
|
$ |
15,130 |
|
Pinedale |
61,368 |
|
|
61,368 |
|
|
61,368 |
|
Total Amortization Expense - Deferred Lease Costs |
$ |
91,932 |
|
|
$ |
91,932 |
|
|
$ |
76,498 |
|
ARO Accretion Expense |
|
|
|
|
|
GIGS |
$ |
663,065 |
|
|
$ |
726,664 |
|
|
$ |
339,042 |
|
Total ARO Accretion Expense |
$ |
663,065 |
|
|
$ |
726,664 |
|
|
$ |
339,042 |
|
|
| Schedule of Deferred Lease Costs |
The following table reflects the deferred costs that are included in the accompanying Consolidated Balance Sheets associated with the Company's leased properties:
|
|
|
|
|
|
|
|
|
|
December 31, 2017 |
|
December 31, 2016 |
Net Deferred Lease Costs |
|
|
|
GIGS |
$ |
259,883 |
|
|
$ |
290,447 |
|
Pinedale |
611,717 |
|
|
673,085 |
|
Total Deferred Lease Costs, net |
$ |
871,600 |
|
|
$ |
963,532 |
|
|