Annual report pursuant to Section 13 and 15(d)

Leased Properties and Leases (Tables)

v3.10.0.1
Leased Properties and Leases (Tables)
12 Months Ended
Dec. 31, 2018
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
Location
Gulf of Mexico/Louisiana
Pinedale, WY
Tenant
Energy XXI GIGS Services, LLC
Ultra Wyoming LGS, 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.
Date Acquired
June 2015
December 2012
Initial Lease Term
11 years
15 years
Renewal Option
Equal to the lesser of 9-years or 75 percent of the remaining useful life
5-year terms
Current Monthly Rent Payments
7/1/17 - 6/30/18: $2,854,667
7/1/18 - 6/30/19: $2,860,917
$1,776,772(1)
Estimated Useful Life
27 years
26 years
(1) Monthly rent payments increased to $1,812,307 beginning January 1, 2019.
Schedule of future minimum lease receipts
The future contracted minimum rental receipts for all leases as of December 31, 2018, are as follows:
Future Minimum Lease Receipts
Year Ending December 31,
Amount
2019
$
58,347,190

2020
65,383,190

2021
71,345,190

2022
70,322,690

2023
67,274,690

Thereafter
193,639,760

Total
$
526,312,710

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,
 
2018
 
2017
 
2018
 
2017
 
2016
Pinedale LGS (2)
44.5
%
 
39.9
%
 
35.2
%
 
31.2
%
 
30.4
%
Grand Isle Gathering System
55.2
%
 
49.7
%
 
55.9
%
 
59.1
%
 
59.8
%
Portland Terminal Facility (3)
%
 
10.1
%
 
8.8
%
 
9.6
%
 
9.7
%
(1) Insignificant leases are not presented; thus percentages may not sum to 100%.
(2) Pinedale LGS lease revenues include variable rent of $4.3 million and $587 thousand for the years ended December 31, 2018 and 2017, respectively.
(3) On December 21, 2018, the Portland Terminal Facility was sold to Zenith Terminals, terminating the Portland Lease Agreement. Refer to "Sale of the Portland Terminal Facility" section below.
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,
 
2018
 
2017
 
2016
Depreciation Expense
 
 
 
 
 
GIGS
$
10,836,590

 
$
9,754,596

 
$
8,605,506

Pinedale
8,869,440

 
8,869,440

 
8,869,440

Portland Terminal Facility (1)
1,243,769

 
1,275,660

 
843,084

United Property Systems
36,662

 
36,298

 
32,424

Total Depreciation Expense
$
20,986,461

 
$
19,935,994

 
$
18,350,454

Amortization Expense - Deferred Lease Costs
 
 
 
 
 
GIGS
$
30,564

 
$
30,564

 
$
30,564

Pinedale
61,368

 
61,368

 
61,368

Total Amortization Expense - Deferred Lease Costs
$
91,932

 
$
91,932

 
$
91,932

ARO Accretion Expense
 
 
 
 
 
GIGS
$
499,562

 
$
663,065

 
$
726,664

Total ARO Accretion Expense
$
499,562

 
$
663,065

 
$
726,664

(1) On December 21, 2018, the Portland Terminal Facility was sold to Zenith Terminals, terminating the Portland Lease Agreement. Refer to "Sale of the Portland Terminal Facility" section below.
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, 2018
 
December 31, 2017
Net Deferred Lease Costs
 
 
 
GIGS
$
229,319

 
$
259,883

Pinedale
550,349

 
611,717

Total Deferred Lease Costs, net
$
779,668

 
$
871,600