Leased Properties and Leases (Tables)
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9 Months Ended |
Sep. 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 137 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 September 30, 2019, are as follows:
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Future Minimum Lease Receipts |
Years Ending December 31, |
Amount |
2019 |
$ |
15,138,797 |
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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 |
$ |
483,104,317 |
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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 Nine Months Ended |
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September 30, 2019 |
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December 31, 2018 |
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September 30, 2019 |
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September 30, 2018 |
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September 30, 2019 |
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September 30, 2018 |
Pinedale LGS(2)
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44.4 |
% |
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44.5 |
% |
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40.0 |
% |
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35.7 |
% |
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39.3 |
% |
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34.6 |
% |
Grand Isle Gathering System |
55.3 |
% |
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55.2 |
% |
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59.8 |
% |
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55.3 |
% |
|
60.6 |
% |
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56.2 |
% |
Portland Terminal Facility(3)
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— |
% |
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— |
% |
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— |
% |
|
8.9 |
% |
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— |
% |
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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 $1.4 million and $3.5 million for the three and nine months ended September 30, 2019, respectively, compared to $1.2 million and $2.8 million for the three and nine months ended September 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 Nine Months Ended |
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September 30, 2019 |
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September 30, 2018 |
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September 30, 2019 |
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September 30, 2018 |
Depreciation Expense |
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GIGS |
$ |
2,440,791 |
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$ |
2,751,272 |
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$ |
7,322,372 |
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$ |
8,253,816 |
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Pinedale |
2,217,360 |
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2,217,360 |
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6,652,080 |
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6,652,080 |
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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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|
956,745 |
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United Property Systems |
9,831 |
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|
9,210 |
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29,286 |
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|
27,452 |
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Total Depreciation Expense |
$ |
4,667,982 |
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$ |
5,296,757 |
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$ |
14,003,738 |
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$ |
15,890,093 |
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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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$ |
22,923 |
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$ |
22,923 |
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Pinedale |
15,342 |
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15,342 |
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|
46,026 |
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46,026 |
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Total Amortization Expense - Deferred Lease Costs |
$ |
22,983 |
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$ |
22,983 |
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$ |
68,949 |
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$ |
68,949 |
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ARO Accretion Expense |
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GIGS |
$ |
110,992 |
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$ |
127,928 |
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$ |
332,977 |
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$ |
383,784 |
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Total ARO Accretion Expense |
$ |
110,992 |
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$ |
127,928 |
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$ |
332,977 |
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$ |
383,784 |
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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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September 30, 2019 |
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December 31, 2018 |
Net Deferred Lease Costs |
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GIGS |
$ |
206,396 |
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$ |
229,319 |
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Pinedale |
504,323 |
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|
550,349 |
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Total Deferred Lease Costs, net |
$ |
710,719 |
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$ |
779,668 |
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