Leased Properties and Leases (Tables)
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6 Months Ended |
Jun. 30, 2019 |
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| Leases [Abstract] |
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| Significant leased properties, major tenants and lease terms |
The following table summarizes the significant leased properties, major tenants and lease terms:
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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 |
7/1/2018 - 6/30/2019: $2,860,917
7/1/2019 - 6/30/2020: $3,223,917 |
$1,812,307 |
Initial Estimated Useful Life |
27 years |
26 years |
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| Schedule of future minimum lease receipts |
The future contracted minimum rental receipts for all leases as of June 30, 2019, are as follows:
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Future Minimum Lease Receipts |
Years Ending December 31, |
Amount |
2019 |
$ |
30,267,595 |
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2020 |
65,383,190 |
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2021 |
71,345,190 |
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2022 |
70,322,690 |
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2023 |
67,274,690 |
|
Thereafter |
193,639,760 |
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Total |
$ |
498,233,115 |
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| 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:
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As a Percentage of (1)
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Leased Properties |
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Lease Revenues |
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As of |
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For the Three Months Ended |
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For the Six Months Ended |
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June 30, 2019 |
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December 31, 2018 |
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June 30, 2019 |
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June 30, 2018 |
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June 30, 2019 |
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June 30, 2018 |
Pinedale LGS(2)
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44.4 |
% |
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44.5 |
% |
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38.8 |
% |
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35.3 |
% |
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38.9 |
% |
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34.1 |
% |
Grand Isle Gathering System |
55.3 |
% |
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55.2 |
% |
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61.1 |
% |
|
55.6 |
% |
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61.0 |
% |
|
56.7 |
% |
Portland Terminal Facility(3)
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— |
% |
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— |
% |
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— |
% |
|
9.0 |
% |
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— |
% |
|
9.1 |
% |
(1) Insignificant leases are not presented; thus, percentages may not sum to 100%. |
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(2) Pinedale LGS lease revenues include variable rent of $1.0 million and $2.1 million for the three and six months ended June 30, 2019, respectively, compared to $1.1 million and $1.5 million for the three and six months ended June 30, 2018, respectively. |
(3) On December 21, 2018, the Portland Terminal Facility was sold to Zenith Terminals, terminating the Portland Lease Agreement. |
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| 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:
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For the Three Months Ended |
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For the Six Months Ended |
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June 30, 2019 |
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June 30, 2018 |
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June 30, 2019 |
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June 30, 2018 |
Depreciation Expense |
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GIGS |
$ |
2,440,790 |
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$ |
2,751,272 |
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$ |
4,881,581 |
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$ |
5,502,544 |
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Pinedale |
2,217,360 |
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2,217,360 |
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|
4,434,720 |
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4,434,720 |
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Portland Terminal Facility(1)
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— |
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|
318,915 |
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— |
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|
637,830 |
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United Property Systems |
9,831 |
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9,120 |
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|
19,455 |
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|
18,242 |
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Total Depreciation Expense |
$ |
4,667,981 |
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$ |
5,296,667 |
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$ |
9,335,756 |
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$ |
10,593,336 |
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Amortization Expense - Deferred Lease Costs |
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GIGS |
$ |
7,641 |
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$ |
7,641 |
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$ |
15,282 |
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$ |
15,282 |
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Pinedale |
15,342 |
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15,342 |
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|
30,684 |
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30,684 |
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Total Amortization Expense - Deferred Lease Costs |
$ |
22,983 |
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$ |
22,983 |
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$ |
45,966 |
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$ |
45,966 |
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ARO Accretion Expense |
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GIGS |
$ |
110,993 |
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$ |
127,928 |
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$ |
221,985 |
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$ |
255,856 |
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Total ARO Accretion Expense |
$ |
110,993 |
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$ |
127,928 |
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$ |
221,985 |
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$ |
255,856 |
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(1) On December 21, 2018, the Portland Terminal Facility was sold to Zenith Terminals, terminating the Portland Lease Agreement. |
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| 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:
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June 30, 2019 |
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December 31, 2018 |
Net Deferred Lease Costs |
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GIGS |
$ |
214,037 |
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$ |
229,319 |
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Pinedale |
519,665 |
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|
550,349 |
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Total Deferred Lease Costs, net |
$ |
733,702 |
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$ |
779,668 |
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