falsedesktopAMID2019-03-31000151396519000063{"tbl_sim": "https://q10k.com/tbl-sim", "search": "https://q10k.com/search"}{"q10k_tbl_0": "Delaware\t27-0855785\n(State or other jurisdiction of incorporation or organization)\t(I.R.S. Employer Identification No.)\n2103 CityWest Boulevard\t\nBuilding #4 Suite 800\t\nHouston TX 77042\t(346) 241-3400\n(Address of principal executive offices) (zip code)\t(Registrant's telephone number including area code)\n", "q10k_tbl_1": "Large accelerated filer\t¨\tAccelerated filer\tý\nNon-accelerated filer\t¨\tSmaller reporting company\t¨\n\t\tEmerging growth company\t¨\nIf 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.\t\t\t¨\n", "q10k_tbl_2": "\t\tPage\nPART I. FINANCIAL INFORMATION\t\t4\nItem 1.\tFinancial Statements\t4\n\tCondensed Consolidated Balance Sheets as of March 31 2019 and December 31 2018\t4\n\tCondensed Consolidated Statements of Operations for the three months ended March 31 2019 and 2018\t5\n\tCondensed Consolidated Statements of Comprehensive Income (Loss) for the three months ended March 31 2019 and 2018\t6\n\tCondensed Consolidated Statements of Changes in Equity and Partners' Capital for the three months ended March 31 2019 and 2018\t7\n\tCondensed Consolidated Statements of Cash Flows for the three months ended March 31 2019 and 2018\t8\n\tNotes to Condensed Consolidated Financial Statements\t10\nItem 2.\tManagement's Discussion and Analysis of Financial Condition and Results of Operations\t29\nItem 3.\tQuantitative and Qualitative Disclosures About Market Risk\t42\nItem 4.\tControls and Procedures\t42\nPART II. OTHER INFORMATION\t\t43\nItem 1.\tLegal Proceedings\t43\nItem 1A.\tRisk Factors\t43\nItem 5.\tOther Information\t43\nItem 6.\tExhibits\t44\n", "q10k_tbl_3": "\tMarch 31 2019\tDecember 31 2018\nAssets\t\t\nCurrent assets\t\t\nCash and cash equivalents\t12273\t9069\nRestricted cash\t33558\t30868\nAccounts receivable net of allowance for doubtful accounts of $511 and $591 as of March 31 2019 and December 31 2018 respectively\t87355\t76632\nInventory\t8924\t1186\nOther current assets\t21728\t26236\nTotal current assets\t163838\t143991\nProperty plant and equipment net\t995755\t997708\nGoodwill\t51723\t51723\nRestricted cash-long term\t5281\t5083\nIntangible assets net\t131447\t133992\nInvestments in unconsolidated affiliates\t321760\t337796\nOther assets net\t45933\t17403\nTotal assets\t1715737\t1687696\nLiabilities Equity and Partners' Capital\t\t\nCurrent liabilities\t\t\nAccounts payable\t44789\t36619\nAccrued gas purchases\t9417\t11695\nAccrued expenses and other current liabilities\t68448\t78612\nCurrent portion of long-term debt\t542163\t522966\nTotal current liabilities\t664817\t649892\nAsset retirement obligations\t68338\t67451\nOther long-term liabilities\t41876\t18491\nLong-term debt\t501836\t500739\nDeferred tax liability\t1421\t1421\nTotal liabilities\t1278288\t1237994\nCommitments and contingencies (Note 14)\t\t\nConvertible preferred units\t331964\t324624\nEquity and partners' capital\t\t\nGeneral Partner interests (981 units issued and outstanding as of March 31 2019 and December 31 2018)\t(66528)\t(66591)\nLimited Partner interests (54212 and 54017 units issued and outstanding as of March 31 2019 and December 31 2018 respectively)\t158122\t177861\nAccumulated other comprehensive income\t68\t32\nTotal partners' capital\t91662\t111302\nNoncontrolling interests\t13823\t13776\nTotal equity and partners' capital\t105485\t125078\nTotal liabilities equity and partners' capital\t1715737\t1687696\n", "q10k_tbl_4": "\tThree months ended March 31\t\n\t2019\t2018\nRevenue:\t\t\nCommodity sales\t137529\t158863\nServices\t36822\t46906\n(Loss) gain on commodity derivatives net\t(1521)\t60\nTotal revenue\t172830\t205829\nOperating expenses:\t\t\nCosts of sales\t128061\t150166\nDirect operating expenses\t17978\t23446\nCorporate expenses\t19401\t22692\nDepreciation amortization and accretion\t21180\t21997\nLoss (gain) on sale of assets net\t55\t(95)\nImpairment of long-lived assets\t829\t0\nTotal operating expenses\t187504\t218206\nOperating loss\t(14674)\t(12377)\nOther income (expense) net\t\t\nInterest expense net of capitalized interest\t(24363)\t(13876)\nOther income net\t8\t22\nEarnings in unconsolidated affiliates\t26110\t12673\nLoss before income taxes\t(12919)\t(13558)\nIncome tax expense\t(218)\t(280)\nNet loss\t(13137)\t(13838)\nNet income attributable to noncontrolling interests\t(77)\t(45)\nNet loss attributable to the Partnership\t(13214)\t(13883)\nGeneral Partner's interest in net loss\t(170)\t(181)\nLimited Partners' interest in net loss\t(13044)\t(13702)\nLimited Partners' net loss per common unit:\t\t\nBasic and diluted:\t\t\nNet loss per common unit\t(0.38)\t(0.42)\nWeighted average number of common units outstanding:\t\t\nBasic and diluted\t54082\t52769\n", "q10k_tbl_5": "\tThree months ended March 31\t\n\t2019\t2018\nNet loss\t(13137)\t(13838)\nUnrealized (loss) gain related to postretirement benefit plan\t36\t(16)\nComprehensive loss\t(13101)\t(13854)\nComprehensive income attributable to noncontrolling interests\t(77)\t(45)\nComprehensive loss attributable to the Partnership\t(13178)\t(13899)\n", "q10k_tbl_6": "\tGeneral Partner Interests\tLimited Partner Interests\tAccumulated Other Comprehensive Income (Loss)\tTotal Partners' Capital\tNon- controlling Interests\tTotal Equity and Partners' Capital\nBalances at December 31 2017\t(96552)\t273703\t28\t177179\t13761\t190940\nCumulative effect of accounting change (Note 3)\t(139)\t(10552)\t0\t(10691)\t0\t(10691)\nBalances at January 1 2018\t(96691)\t263151\t28\t166488\t13761\t180249\nNet loss\t(181)\t(13702)\t0\t(13883)\t45\t(13838)\nContributions\t9870\t0\t0\t9870\t0\t9870\nDistributions\t(392)\t(29728)\t0\t(30120)\t0\t(30120)\nDistributions to NCI owners\t0\t0\t0\t0\t(20)\t(20)\nDistribution for acquisition of Trans-Union\t(38)\t0\t0\t(38)\t0\t(38)\nLTIP vesting\t(2328)\t2328\t0\t0\t0\t0\nTax netting repurchase\t0\t(703)\t0\t(703)\t0\t(703)\nEquity compensation expense\t1014\t0\t0\t1014\t0\t1014\nPost-retirement benefit plan\t0\t0\t(16)\t(16)\t0\t(16)\nBalances at March 31 2018\t(88746)\t221346\t12\t132612\t13786\t146398\nBalances at December 31 2018\t(66591)\t177861\t32\t111302\t13776\t125078\nNet loss\t(170)\t(13044)\t0\t(13214)\t77\t(13137)\nDistributions\t(95)\t(7245)\t0\t(7340)\t0\t(7340)\nLTIP vesting\t(698)\t698\t0\t0\t0\t0\nTax netting repurchase\t0\t(148)\t0\t(148)\t0\t(148)\nEquity compensation expense\t1026\t0\t0\t1026\t0\t1026\nPost-retirement benefit plan\t0\t0\t36\t36\t0\t36\nDistributions to NCI owners\t0\t0\t0\t0\t(33)\t(33)\nContributions from NCI owners\t0\t0\t0\t0\t3\t3\nBalances at March 31 2019\t(66528)\t158122\t68\t91662\t13823\t105485\n", "q10k_tbl_7": "\tThree months ended March 31\t\n\t2019\t2018\nCash flows from operating activities\t\t\nNet loss\t(13137)\t(13838)\nAdjustments to reconcile net loss to net cash (used in) provided by operating activities:\t\t\nDepreciation amortization and accretion\t21180\t21997\nAmortization of operating leases\t1407\t0\nAmortization of debt issuance costs\t2549\t1316\nAmortization of weather derivative premium\t247\t278\nUnrealized (gain) loss on derivatives contracts net\t3037\t(5112)\nNon-cash compensation expense\t1026\t1014\nLoss (gain) on sale of assets\t55\t(95)\nOther non-cash items\t7\t(15)\nImpairment of long-lived assets\t829\t0\nEarnings in unconsolidated affiliates\t(26110)\t(12673)\nDistributions from unconsolidated affiliates\t29866\t12673\nBad debt (recovery) expense\t(80)\t87\nDeferred tax benefit\t0\t151\nChanges in operating assets and liabilities:\t\t\nAccounts receivable\t(11918)\t7251\nInventory\t(7738)\t(3399)\nOther current assets\t1312\t(4174)\nOther assets net\t(2546)\t0\nAccounts payable\t8170\t11200\nAccrued gas and crude oil purchases\t(2278)\t(4431)\nAccrued expenses and other current liabilities\t(4096)\t2623\nAsset retirement obligations\t(569)\t(6)\nOther liabilities\t(5453)\t0\nNet cash (used in) provided by operating activities\t(4240)\t14847\nCash flows from investing activities\t\t\nContributions to unconsolidated affiliates\t0\t(987)\nAdditions to property plant and equipment and other\t(18761)\t(25946)\nProceeds from disposals of assets and business\t0\t8\nDistributions from unconsolidated affiliates return of capital\t12280\t11181\nNet cash used in investing activities\t(6481)\t(15744)\n", "q10k_tbl_8": "\tThree months ended March 31\t\n\t2019\t2018\nCash flows from financing activities\t\t\nContributions\t0\t9870\nDistributions\t0\t(22035)\nContribution from noncontrolling interest owners\t3\t0\nDistributions to noncontrolling interests owners\t(33)\t(20)\nLTIP tax netting unit repurchase\t(148)\t(703)\nPayments of financing leases\t(268)\t0\nPayment of debt issuance costs\t(61)\t(1085)\nPayment of long-term debt\t(559)\t(507)\nPayment of 3.97% Senior Notes\t(451)\t(439)\nPayments of other debt\t(1576)\t(1893)\nPayments of credit agreement\t(33000)\t(119700)\nBorrowings on credit agreement\t52500\t134400\nOther\t406\t338\nNet cash provided by (used in) financing activities\t16813\t(1774)\nNet increase (decrease) in cash cash equivalents and restricted cash\t6092\t(2671)\nCash cash equivalents and restricted cash beginning of period\t45020\t34179\nCash cash equivalents and restricted cash end of period\t51112\t31508\nCash cash equivalents and restricted cash beginning of period\t\t\nCash and cash equivalents\t9069\t8782\nRestricted cash - current\t30868\t20352\nRestricted cash - non-current\t5083\t5045\nTotal cash cash equivalents and restricted cash beginning of period\t45020\t34179\nCash cash equivalents and restricted cash end of period\t\t\nCash and cash equivalents\t12273\t8191\nRestricted cash - current\t33558\t18269\nRestricted cash - non-current\t5281\t5048\nTotal cash cash equivalents and restricted cash end of period\t51112\t31508\n", "q10k_tbl_9": "\tThree months ended March 31 2019\t\t\t\t\t\n\tGas Gathering and Processing Services\tLiquid Pipelines and Services\tNatural Gas Transportation Services\tOffshore Pipelines and Services\tTerminalling Services\tTotal\nCommodity sales:\t\t\t\t\t\t\nNatural gas\t1576\t0\t6407\t2286\t0\t10269\nNGLs\t13901\t0\t0\t0\t0\t13901\nCondensate\t8776\t0\t0\t131\t0\t8907\nCrude oil\t0\t104322\t0\t0\t0\t104322\nOther sales\t83\t0\t1\t46\t0\t130\n\t24336\t104322\t6408\t2463\t0\t137529\nServices:\t\t\t\t\t\t\nGathering and processing\t4059\t0\t0\t300\t0\t4359\nTransportation\t332\t2311\t8714\t9042\t0\t20399\nTerminalling and storage\t0\t150\t0\t0\t0\t150\nOther services (1)\t744\t44\t65\t5041\t0\t5894\n\t5135\t2505\t8779\t14383\t0\t30802\nRevenues from contracts with customers\t29471\t106827\t15187\t16846\t0\t168331\n", "q10k_tbl_10": "\tThree months ended March 31 2018\t\t\t\t\t\n\tGas Gathering and Processing Services\tLiquid Pipelines and Services\tNatural Gas Transportation Services\tOffshore Pipelines and Services\tTerminalling Services\tTotal\nCommodity sales:\t\t\t\t\t\t\nNatural gas\t1906\t0\t6637\t2437\t0\t10980\nNGLs\t21150\t0\t0\t38\t0\t21188\nCondensate\t5648\t0\t0\t34\t0\t5682\nCrude oil\t0\t115782\t0\t0\t0\t115782\nOther sales\t184\t0\t4\t39\t5004\t5231\n\t28888\t115782\t6641\t2548\t5004\t158863\nServices:\t\t\t\t\t\t\nGathering and processing\t2365\t0\t0\t866\t0\t3231\nTransportation\t630\t3062\t9412\t8663\t0\t21767\nTerminalling and storage\t0\t1440\t0\t0\t10393\t11833\nOther services (1)\t434\t402\t10\t4613\t562\t6021\n\t3429\t4904\t9422\t14142\t10955\t42852\nRevenues from contracts with customers\t32317\t120686\t16063\t16690\t15959\t201715\n", "q10k_tbl_11": "\tThree months ended March 31 2019\t\t\t\t\t\n\tGas Gathering and Processing Services\tLiquid Pipelines and Services\tNatural Gas Transportation Services\tOffshore Pipelines and Services\tTerminalling Services\tTotal\nRevenues from contracts with customers\t29471\t106827\t15187\t16846\t0\t168331\nRevenues generated through operating lease arrangements(1)(2)\t5738\t0\t0\t282\t0\t6020\nLoss on commodity derivatives net\t0\t(1521)\t0\t0\t0\t(1521)\nTotal revenues of reportable segments\t35209\t105306\t15187\t17128\t0\t172830\n", "q10k_tbl_12": "\tThree months ended March 31 2018\t\t\t\t\t\n\tGas Gathering and Processing Services\tLiquid Pipelines and Services\tNatural Gas Transportation Services\tOffshore Pipelines and Services\tTerminalling Services\tTotal\nRevenues from contracts with customers\t32317\t120686\t16063\t16690\t15959\t201715\nRevenues generated through operating lease arrangements(1)(2)\t3884\t0\t0\t170\t0\t4054\nGain on commodity derivatives net\t2\t58\t0\t0\t0\t60\nTotal revenues of reportable segments\t36203\t120744\t16063\t16860\t15959\t205829\n", "q10k_tbl_13": "\tContract Assets\tContract Liabilities\nBalance at December 31 2018\t8838\t15614\nAmounts recognized as revenue\t(109)\t(367)\nAdditions\t2546\t883\nBalances at March 31 2019\t11275\t16130\nCurrent\t252\t606\nNon-current\t11023\t15524\nBalances at March 31 2019\t11275\t16130\n", "q10k_tbl_14": "\tRemainder of 2019\t2020\t2021\t2022\t2023\tThereafter\tTotal\nGathering and processing based on minimum volume commitments\t9299\t12399\t12399\t12399\t12399\t5928\t64823\nTransportation agreements\t16796\t22141\t21140\t20912\t20912\t181737\t283638\nOther\t1225\t1560\t0\t0\t0\t0\t2785\nTotal\t27320\t36100\t33539\t33311\t33311\t187665\t351246\n", "q10k_tbl_15": "\tThree months ended March 31 2019\nFinance lease cost\t\nAmortization of right-of-use assets\t206\nInterest on lease liabilities\t38\nTotal finance lease cost\t244\nOperating lease cost\t1780\nShort-term and variable lease cost\t2\nSublease income\t(547)\nTotal operating lease cost\t1235\n", "q10k_tbl_16": "\tMarch 31 2019\nOperating leases\t\nOther assets net\t26628\nAccrued expenses and other current liabilities\t6589\nOther long-term liabilities\t24974\nTotal operating lease liabilities\t31563\nFinance leases\t\nProperty plant and equipment net\t2428\nCurrent portion of long-term debt\t841\nLong-term debt\t1629\nTotal finance lease liabilities\t2470\nWeighted average remaining lease term\t\nOperating leases\t13.8 years\nFinance leases\t9.4 years\nWeighted average discount rate\t\nOperating leases\t5.0%\nFinance leases\t6.7%\n", "q10k_tbl_17": "Maturity of Lease Liabilities (thousands)\tOperating Leases\tFinance Leases\tTotal\n2019\t6061\t742\t6803\n2020\t6559\t844\t7403\n2021\t4056\t611\t4667\n2022\t2451\t372\t2823\n2023\t1780\t163\t1943\n2024\t1696\t0\t1696\nThereafter\t22853\t15\t22868\nTotal lease payments\t45456\t2747\t48203\nImputed interest (a)\t(13893)\t(277)\t(14170)\nTotal lease liabilities (b)\t31563\t2470\t34033\n___________________________\t\t\t\n(a) Calculated using the interest rate for each lease.\t\t\t\n(b) Includes the current portion of $6.6 million for operating leases and $0.8 million for finance leases\t\t\t\n", "q10k_tbl_18": "\tMarch 31 2019\tDecember 31 2018\nCrude oil\t8526\t830\nNGLs\t278\t236\nMaterials supplies and equipment\t120\t120\nTotal inventory\t8924\t1186\n", "q10k_tbl_19": "\tMarch 31 2019\t\tDecember 31 2018\t\nCommodity Swaps\tVolume\tMaturity\tVolume\tMaturity\nCrude Oil Basis (barrels)\t100000\tMay 2019\t208000\tFebruary 2019\n", "q10k_tbl_20": "\t\tAsset Derivatives\t\tLiability Derivatives\t\nType\tBalance Sheet Classification\tMarch 31 2019\tDecember 31 2018\tMarch 31 2019\tDecember 31 2018\nCommodity derivatives\tAccrued expenses and other current liabilities\t0\t\t(256)\t(2)\nInterest rate swaps\tOther current assets\t3521\t4314\t0\t0\nInterest rate swaps\tOther assets net\t4027\t6017\t0\t0\nWeather derivatives\tOther current assets\t206\t454\t0\t0\n\tTotal\t7754\t10785\t(256)\t(2)\n", "q10k_tbl_21": "\tThree months ended March 31\t\n\tRealized\tUnrealized\n2019\t\t\nLoss on commodity derivatives net\t(1267)\t(254)\nInterest expense net of capitalized interest\t807\t(2783)\nDirect operating expenses\t(248)\t0\nTotal\t(708)\t(3037)\n2018\t\t\nGain (loss) on commodity derivatives net\t119\t(59)\nInterest expense net of capitalized interest\t1350\t5171\nDirect operating expenses\t(278)\t0\nTotal\t1191\t5112\n", "q10k_tbl_22": "\tMarch 31 2019\tDecember 31 2018\nLiquid Pipelines and Services\t46749\t46749\nOffshore Pipelines and Services\t4974\t4974\nTotal\t51723\t51723\n", "q10k_tbl_23": "\tMarch 31 2019\t\t\n\tGross Carrying Amount\tAccumulated Amortization\tNet Carrying Amount\nCustomer relationships\t64744\t(17775)\t46969\nCustomer contracts\t94692\t(54402)\t40290\nDedicated acreage\t42547\t(7935)\t34612\nCollaborative arrangements\t11884\t(2476)\t9408\nOther\t198\t(30)\t168\nTotal\t214065\t(82618)\t131447\n\tDecember 31 2018\t\t\n\tGross Carrying Amount\tAccumulated Amortization\tNet Carrying Amount\nCustomer relationships\t64744\t(17033)\t47711\nCustomer contracts\t94692\t(53156)\t41536\nDedicated acreage\t42547\t(7592)\t34955\nCollaborative arrangements\t11884\t(2264)\t9620\nOther\t198\t(28)\t170\nTotal\t214065\t(80073)\t133992\n", "q10k_tbl_24": "\tDelta House (1)\t\t\t\t\t\t\t\n\tFPS(245)\tOGL(245)\tDestin(4)\tTri-States(3)\tOkeanos(4)\tWilprise(3)\tCayenne(3)\tTotal\nOwnership %\t35.7%\t35.7%\t66.7%\t16.7%\t66.7%\t25.3%\t50.0%\t\nBalances at January 1 2019\t91466\t41815\t114351\t51329\t20641\t4507\t13687\t337796\nEarnings in unconsolidated affiliates\t10488\t4456\t5693\t1132\t2177\t200\t1964\t26110\nDistributions\t(15521)\t(6296)\t(10095)\t(2184)\t(5278)\t(272)\t(2500)\t(42146)\nBalances at March 31 2019\t86433\t39975\t109949\t50277\t17540\t4435\t13151\t321760\n", "q10k_tbl_25": "\tDelta House\t\t\t\t\t\t\t\n\tFPS\tOGL\tDestin\tTri-States\tOkeanos\tWilprise\tCayenne\tTotal\nDecember 31 2018\t41762\t(8424)\t826\t30587\t(57039)\t1374\t(3666)\t5420\nMarch 31 2019\t41343\t(8338)\t812\t30210\t(56164)\t1346\t(3599)\t5610\n", "q10k_tbl_26": "Balance Sheets\tMarch 31 2019\tDecember 31 2018\nCurrent assets\t89964\t96116\nNon-current assets\t1233777\t1239733\nCurrent liabilities\t74139\t14700\nNon-current liabilities\t486320\t542047\n", "q10k_tbl_27": "\tThree months ended March 31\t\nStatements of Operations:\t2019\t2018\nRevenue\t89756\t56898\nOperating expenses\t6905\t6292\nNet income\t67784\t32845\n", "q10k_tbl_28": "\tMarch 31 2019\tDecember 31 2018\nRevolving credit facility\t534300\t514800\n8.50% Senior unsecured notes due 2021\t425000\t425000\n3.77% Senior secured notes due 2031 (non-recourse)\t56957\t57517\n3.97% Senior secured notes due 2032 (non-recourse)\t29819\t30270\nOther debt\t2952\t4127\nFinance lease obligations\t2470\t0\nTotal debt obligations\t1051498\t1031714\nUnamortized debt issuance costs\t(7499)\t(8009)\nTotal debt\t1043999\t1023705\nCurrent portion of long-term debt\t(541322)\t(522966)\nCurrent portion of finance lease obligations\t(841)\t0\nLong term debt\t501836\t500739\n", "q10k_tbl_29": "\tMinimum Consolidated Interest Coverage Ratio\tMaximum Consolidated Total Leverage Ratio\tMaximum Consolidated Secured Leverage Ratio\nDecember 31 2018\t1.75:1.00\t6.25:1.00\t3.75:1.00\nMarch 31 2019\t1.75:1.00\t6.50:1.00\t3.75:1.00\nJune 30 2019 and thereafter\t1.50:1.00\t5.75:1.00\t3.50:1.00\n", "q10k_tbl_30": "\tMarch 31 2019\t\tDecember 31 2018\t\n\tCarrying Amount\tFair Value\tCarrying Amount\tFair Value\nDebt\t\t\t\t\n8.5% Senior Unsecured Notes\t419914\t409122\t419451\t399789\n3.77% Senior Secured Notes\t54854\t51942\t55370\t51567\n3.97% Trans-Union Secured Senior Notes\t29509\t27632\t29956\t27822\nTotal\t504277\t488696\t504777\t479178\n", "q10k_tbl_31": "\tSeries A\t\tSeries C\t\tTotal\n\tUnits\t$\tUnits\t$\t$\nDecember 31 2018\t11010\t195781\t9242\t128843\t324624\nPaid in kind unit distributions\t332\t3867\t273\t3473\t7340\nMarch 31 2019\t11342\t199648\t9515\t132316\t331964\n", "q10k_tbl_32": "\tGeneral Partner Units\tLimited Partner Units\nBalances at December 31 2018\t981\t54017\nLTIP units vesting\t0\t195\nBalances at March 31 2019\t981\t54212\n", "q10k_tbl_33": "\tThree months ended March 31\t\n\t2019\t2018\nNet loss\t(13137)\t(13838)\nNet income attributable to noncontrolling interests\t(77)\t(45)\nNet loss attributable to the Partnership\t(13214)\t(13883)\nDistributions on Series A Units\t(3867)\t(4542)\nDistributions on Series C Units\t(3473)\t(3812)\nGeneral Partner's distribution\t0\t(290)\nGeneral Partner's share in undistributed loss\t265\t583\nNet loss attributable to Limited Partners\t(20289)\t(21944)\nWeighted average number of common units outstanding:\t\t\nBasic and diluted(1):\t54082\t52769\nLimited Partners' net loss per common unit\t\t\nBasic and diluted:\t\t\nNet loss\t(0.38)\t(0.42)\n", "q10k_tbl_34": "\tThree months ended March 31\t\nGrant Type:\t2019\t2018\nRSU\t725\t694\nPSU\t239\t313\nOptions\t9\t15\nTotal\t973\t1022\n", "q10k_tbl_35": "\tThree months ended March 31\t\n\t2019\t2018\nSupplemental non-cash information\t\t\nInvesting\t\t\n(Decrease) increase in accrued property plant and equipment purchases\t(5933)\t10159\nFinancing\t\t\nAccrued distributions on convertible preferred units\t0\t8354\nPaid-in-kind distributions on convertible preferred units\t7340\t0\n", "q10k_tbl_36": "\tThree months ended March 31 2019\t\t\t\t\n\tGas Gathering and Processing Services\tLiquid Pipelines and Services\tNatural Gas Transportation Services\tOffshore Pipelines and Services\tTotal\nRevenue\t35209\t106827\t15187\t17128\t174351\nLoss on commodity derivatives net\t0\t(1521)\t0\t0\t(1521)\nTotal revenue\t35209\t105306\t15187\t17128\t172830\nOperating expenses:\t\t\t\t\t\nCost of sales\t20363\t100707\t5818\t1173\t128061\nDirect operating expenses\t\t\t\t\t17978\nCorporate expenses\t\t\t\t\t19401\nDepreciation amortization and accretion expense\t\t\t\t\t21180\nLoss on sale of assets net\t\t\t\t\t55\nImpairment of long-lived assets\t\t\t\t\t829\nTotal operating expenses\t\t\t\t\t187504\nOperating loss\t\t\t\t\t(14674)\nOther income (expense) net\t\t\t\t\t\nInterest expense net of capitalized interest\t\t\t\t\t(24363)\nOther income net\t\t\t\t\t8\nEarnings in unconsolidated affiliates\t0\t3296\t0\t22814\t26110\nLoss before income taxes\t\t\t\t\t(12919)\nIncome tax expense\t\t\t\t\t(218)\nNet loss\t\t\t\t\t(13137)\nNet income attributable to non-controlling interests\t\t\t\t\t(77)\nNet loss attributable to the Partnership\t\t\t\t\t(13214)\nSegment gross margin\t14876\t8104\t9428\t38770\t\n", "q10k_tbl_37": "\tThree months ended March 31 2018\t\t\t\t\t\n\tGas Gathering and Processing Services\tLiquid Pipelines and Services\tNatural Gas Transportation Services\tOffshore Pipelines and Services\tTerminalling Services (1)\tTotal\nRevenue\t36201\t120686\t16063\t16860\t15959\t205769\nGain on commodity derivatives net\t2\t58\t0\t0\t0\t60\nTotal revenue\t36203\t120744\t16063\t16860\t15959\t205829\nOperating expenses:\t\t\t\t\t\t\nCost of sales\t24024\t113836\t5288\t1995\t5023\t150166\nDirect operating expenses\t\t\t\t\t3647\t23446\nCorporate expenses\t\t\t\t\t\t22692\nDepreciation amortization and accretion expense\t\t\t\t\t\t21997\nGain on sale of assets net\t\t\t\t\t\t(95)\nTotal operating expenses\t\t\t\t\t\t218206\nOperating loss\t\t\t\t\t\t(12377)\nOther income (expenses) net\t\t\t\t\t\t0\nInterest expense net of capitalized interest\t\t\t\t\t\t(13876)\nOther income net\t\t\t\t\t\t22\nEarnings in unconsolidated affiliates\t0\t2222\t0\t10451\t0\t12673\nLoss before income taxes\t\t\t\t\t\t(13558)\nIncome tax expense\t\t\t\t\t\t(280)\nNet loss\t\t\t\t\t\t(13838)\nNet income attributable to non-controlling interests\t\t\t\t\t\t(45)\nNet loss attributable to the Partnership\t\t\t\t\t\t(13883)\nSegment gross margin\t12209\t9154\t10687\t25317\t7289\t\n", "q10k_tbl_38": "\tMarch 31\tDecember 31\n\t2019\t2018\nSegment assets:\t\t\nGas Gathering and Processing Services\t401200\t400052\nLiquid Pipelines and Services\t447881\t426831\nNatural Gas Transportation Services\t275716\t271890\nOffshore Pipelines and Services\t522368\t531400\nOther (1)\t68572\t57523\nTotal assets\t1715737\t1687696\nInvestment in unconsolidated affiliates:\t\t\nLiquid Pipelines and Services\t67863\t69523\nOffshore Pipelines and Services\t253897\t268273\nTotal investment in unconsolidated affiliates\t321760\t337796\n", "q10k_tbl_39": "\tThree months ended March 31\t\nReconciliation of Total Segment Gross Margin and Operating Margin to Net Loss Attributable to the Partnership:\t2019\t2018\nGas Gathering and Processing Services segment gross margin\t14876\t12209\nLiquid Pipelines and Services segment gross margin\t8104\t9154\nNatural Gas Transportation Services segment gross margin\t9428\t10687\nOffshore Pipelines and Services segment gross margin\t38770\t25317\nTerminalling Services segment gross margin (1)\t0\t7289\nTotal segment gross margin\t71178\t64656\nDirect operating expenses(2)\t(17978)\t(19799)\nOperating margin\t53200\t44857\n(Loss) gain on commodity derivatives net\t(1521)\t60\nCorporate expenses\t(19401)\t(22692)\nDepreciation amortization and accretion expense\t(21180)\t(21997)\n(Loss) gain on sale of assets net\t(55)\t95\nImpairment of long-lived assets\t(829)\t0\nInterest expense net of capitalized interest\t(24363)\t(13876)\nOther income net\t1230\t(5)\nIncome tax expense\t(218)\t(280)\nNet income attributable to noncontrolling interests\t(77)\t(45)\nNet loss attributable to the Partnership\t(13214)\t(13883)\n", "q10k_tbl_40": "\tThree months ended March 31\t\n\t2019\t2018\nGas Gathering and Processing Services\t6349\t7170\nLiquid Pipelines and Services\t2978\t3161\nNatural Gas Transportation Services\t2712\t1673\nOffshore Pipelines and Services\t5939\t7795\nTotal direct operating expenses\t17978\t19799\n", "q10k_tbl_41": "\tThree months ended March 31\t\n\t2019\t2018\nReconciliation of Net loss Attributable to the Partnership to Adjusted EBITDA :\t\t\nNet loss attributable to the Partnership\t(13214)\t(13883)\nDepreciation amortization and accretion\t21180\t21997\nInterest expense net of capitalized interest\t24363\t13876\nAmortization of deferred financing costs\t(2549)\t(1316)\nDebt issuance costs paid\t61\t1085\nUnrealized loss on commodity derivatives net\t254\t59\nNon-cash equity compensation expense\t1026\t1014\nTransaction expenses\t6370\t8877\nImpairment of long-lived assets\t829\t0\nIncome tax expense\t218\t280\nDistributions from unconsolidated affiliates\t42146\t23853\nGeneral Partner contribution\t0\t9417\nEarnings in unconsolidated affiliates\t(26110)\t(12673)\nCOMA\t46\t(90)\nOther post-employment benefits plan net periodic benefit\t(19)\t15\nLoss (gain) on sale of assets net\t55\t(95)\nAdjusted EBITDA\t54656\t52416\n", "q10k_tbl_42": "\tThree months ended March 31\t\t\t\n\t2019\t2018\tChange\t%\nRevenue\t172830\t205829\t(32999)\t(16)%\nOperating expenses:\t\t\t\t\nCost of sales\t128061\t150166\t(22105)\t(15)%\nDirect operating expenses\t17978\t23446\t(5468)\t(23)%\nCorporate expenses\t19401\t22692\t(3291)\t(15)%\nDepreciation amortization and accretion expense\t21180\t21997\t(817)\t(4)%\nLoss (gain) on sale of assets net\t55\t(95)\t150\t*\nImpairment of long-lived assets\t829\t0\t829\t*\nTotal operating expenses\t187504\t218206\t(30702)\t(14)%\nOperating loss\t(14674)\t(12377)\t(2297)\t(19)%\nOther income (expense) net\t\t\t\t\nInterest expense net of capitalized interest\t(24363)\t(13876)\t(10487)\t76%\nOther income net\t8\t22\t(14)\t*\nEarnings in unconsolidated affiliates\t26110\t12673\t13437\t106%\nLoss before income taxes\t(12919)\t(13558)\t639\t5%\nIncome tax expense\t(218)\t(280)\t62\t*\nNet loss\t(13137)\t(13838)\t701\t(5)%\nNet income attributable to noncontrolling interests\t(77)\t(45)\t(32)\t(71)%\nNet loss attributable to the Partnership\t(13214)\t(13883)\t669\t(5)%\nNon-GAAP Financial Measures\t\t\t\t\nTotal segment gross margin (1)\t71178\t64656\t6522\t10%\nAdjusted EBITDA (1)\t54656\t52416\t2240\t4%\n", "q10k_tbl_43": "\tThree months ended March 31\t\t\t\n\t2019\t2018\tChange\t%\nSegment Financial and Operating Data:\t\t\t\t\nFinancial data:\t\t\t\t\nCommodity sales\t24336\t28888\t(4552)\t(16)%\nServices\t10873\t7313\t3560\t49%\nRevenue from operations\t35209\t36201\t(992)\t(3)%\nGain on commodity derivatives net\t0\t2\t(2)\t(100)%\nSegment revenue\t35209\t36203\t(994)\t(3)%\nCost of sales\t20363\t24024\t(3661)\t(15)%\nDirect operating expenses\t6349\t7170\t(821)\t(11)%\nOther financial data:\t\t\t\t\nSegment gross margin (1)\t14876\t12209\t2667\t22%\nOperating data:\t\t\t\t\nAverage throughput (MMcf/d)\t201\t161\t40\t25%\nAverage plant inlet volume (MMcf/d) (2)\t43\t42\t1\t2%\nAverage gross NGL production (Mgal/d) (2)\t302\t262\t40\t15%\nAverage gross condensate production (Mgal/d) (2)\t81\t69\t12\t17%\n", "q10k_tbl_44": "\tThree months ended March 31\t\t\t\n\t2019\t2018\tChange\t%\nSegment Financial and Operating Data:\t\t\t\t\nFinancial data:\t\t\t\t\nCommodity sales\t104322\t115782\t(11460)\t(10)%\nServices\t2505\t4904\t(2399)\t(49)%\nRevenue from operations\t106827\t120686\t(13859)\t(11)%\n(Loss) gain on commodity derivatives net\t(1521)\t58\t(1579)\t(2722)%\nEarnings in unconsolidated affiliates\t3296\t2222\t1074\t48%\nSegment revenue\t108602\t122966\t(14364)\t(12)%\nCost of sales\t100707\t113836\t(13129)\t(12)%\nDirect operating expenses\t2978\t3161\t(183)\t(6)%\nOther financial data:\t\t\t\t\nSegment gross margin (1)\t8104\t9154\t(1050)\t(11)%\nOperating data (2) :\t\t\t\t\nAverage throughput Pipeline (Bbl/d)\t34614\t34310\t304\t1%\nAverage throughput Truck (Bbl/d)\t3634\t2738\t896\t33%\n", "q10k_tbl_45": "\tThree months ended March 31\t\t\t\n\t2019\t2018\tChange\t%\nSegment Financial and Operating Data:\t\t\t\t\nFinancial data:\t\t\t\t\nCommodity sales\t6408\t6641\t(233)\t(4)%\nServices\t8779\t9422\t(643)\t(7)%\nSegment revenue\t15187\t16063\t(876)\t(5)%\nCost of sales\t5818\t5288\t530\t10%\nDirect operating expenses\t2712\t1673\t1039\t62%\nOther financial data:\t\t\t\t\nSegment gross margin (1)\t9428\t10687\t(1259)\t(12)%\nOperating data:\t\t\t\t\nAverage throughput (MMcf/d)\t640\t810\t(170)\t(21)%\n", "q10k_tbl_46": "\tThree months ended March 31\t\t\t\n\t2019\t2018\tChange\t%\nSegment Financial and Operating Data:\t\t\t\t\nFinancial data:\t\t\t\t\nCommodity sales\t2463\t2548\t(85)\t(3)%\nServices\t14665\t14312\t353\t2%\nRevenue from operations\t17128\t16860\t268\t2%\nEarnings in unconsolidated affiliates\t22814\t10451\t12363\t118%\nSegment revenue\t39942\t27311\t12631\t46%\nCost of sales\t1173\t1995\t(822)\t(41)%\nDirect operating expenses\t5939\t7795\t(1856)\t(24)%\nOther financial data:\t\t\t\t\nSegment gross margin (1)\t38770\t25317\t13453\t53%\nOperating data (2):\t\t\t\t\nAverage throughput (MMcf/d)\t385\t274\t111\t41%\n", "q10k_tbl_47": "\tMinimum Consolidated Interest Coverage Ratio\tMaximum Consolidated Total Leverage Ratio\tMaximum Consolidated Secured Leverage Ratio\nDecember 31 2018\t1.75:1.00\t6.25:1.00\t3.75:1.00\nMarch 31 2019\t1.75:1.00\t6.50:1.00\t3.75:1.00\nJune 30 2019 and thereafter\t1.50:1.00\t5.75:1.00\t3.50:1.00\n", "q10k_tbl_48": "\tThree months ended March 31\t\n\t2019\t2018\nNet cash (used in) provided by:\t\t\nOperating activities\t(4240)\t14847\nInvesting activities\t(6481)\t(15744)\nFinancing activities\t16813\t(1774)\n", "q10k_tbl_49": "Exhibit Number\tExhibit\n2.1***\tAgreement and Plan of Merger dated March 17 2019 by and among American Midstream Partners LP American Midstream GP LLC Anchor Midstream Acquisition LLC Anchor Midstream Merger Sub LLC and High Point Infrastructure Partners LLC (incorporated by reference to Exhibit 2.1 to the Current Report on Form 8-K (Commission File No. 001-35257) filed on March 18 2019).\n3.1\tCertificate of Limited Partnership of American Midstream Partners LP (incorporated by reference to Exhibit 3.1 to the Registration Statement on Form S-1 (Commission File No. 333-173191) filed on March 31 2011).\n3.2\tFifth Amended and Restated Agreement of Limited Partnership of American Midstream Partners LP dated April 25 2016 (incorporated by reference to Exhibit 3.1 to the Current Report on Form 8-K (Commission File No. 001-35257) filed on April 29 2016).\n3.3\tAmendment No. 1 to Fifth Amended and Restated Agreement of Limited Partnership of American Midstream Partners LP effective May 1 2016 (incorporated by reference to Exhibit 3.1 to the Current Report on Form 8-K (Commission File No. 001-35257) filed on June 22 2016).\n3.4\tAmendment No. 2 to Fifth Amended and Restated Agreement of Limited Partnership of American Midstream Partners LP dated October 31 2016 (incorporated by reference to Exhibit 3.1 to the Current Report on Form 8-K (Commission File No. 001-35257) filed on November 4 2016).\n3.5\tAmendment No. 3 to Fifth Amended and Restated Agreement of Limited Partnership of American Midstream Partners LP dated March 8 2017 (incorporated by reference to Exhibit 3.1 to the Current Report on Form 8-K (Commission File No. 001-35257) filed on March 8 2017).\n3.6\tComposite Fifth Amended and Restated Agreement of Limited Partnership of American Midstream Partners LP including Amendment No. 1 Amendment No. 2 and Amendment No. 3 (incorporated by reference to Exhibit 3.19 to the Annual Report on Form 10-K (Commission File No. 001-35257) filed on March 28 2017).\n3.7\tAmendment No. 4 to Fifth Amended and Restated Agreement of Limited Partnership of American Midstream Partners LP dated May 25 2017 (incorporated by reference to Exhibit 3.1 to the Current Report on Form 8-K (Commission File No. 001-35257) filed on May 31 2017).\n3.8\tAmendment No. 5 to Fifth Amended and Restated Agreement of Limited Partnership of American Midstream Partners LP dated June 30 2017 (incorporated by reference to Exhibit 3.1 to the Current Report on Form 8-K (Commission File No. 001-35257) filed on July 14 2017).\n3.9\tAmendment No. 6 to Fifth Amended and Restated Agreement of Limited Partnership of American Midstream Partners LP dated September 7 2017 (incorporated by reference to Exhibit 3.1 to the Current Report on Form 8-K (Commission File No. 001-35257) filed on September 11 2017).\n3.10\tAmendment No. 7 to Fifth Amended and Restated Agreement of Limited Partnership of American Midstream Partners LP dated October 26 2017 (incorporated by reference to Exhibit 3.1 to the Current Report on Form 8-K (Commission File No. 001-35257) filed on October 30 2017).\n3.11\tAmendment No. 8 to Fifth Amended and Restated Agreement of Limited Partnership of American Midstream Partners LP dated January 25 2018 (incorporated by reference to Exhibit 3.1 to the Current Report on Form 8-K (Commission File No. 001-35257) filed on January 31 2018).\n3.12\tAmendment No. 9 to Fifth Amended and Restated Agreement of Limited Partnership of American Midstream Partners LP dated as of May 3 2018 (incorporated by reference to Exhibit 3.1 to the Current Report on Form 8-K (Commission File No. 001-35257) filed May 4 2018).\n3.13\tCertificate of Formation of American Midstream GP LLC (incorporated by reference to Exhibit 3.4 to the Registration Statement on Form S-1 (Commission File No. 333-173191) filed on March 31 2011).\n3.14\tFourth Amended and Restated Limited Liability Company Agreement of American Midstream GP LLC (incorporated by reference to Exhibit 3.1 to the Current Report on Form 8-K (Commission File No. 001-35257) filed on August 15 2017).\n3.15*\tAmendment No. 10 to Fifth Amended and Restated Agreement of Limited Partnership of American Midstream Partners LP dated May 7 2019.\n10.1\tThird Amendment to Second Amended and Restated Credit Agreement with American Midstream LLC Blackwater Investments Inc. the other Loan Parties the Lenders and Bank of America N.A. as Administrative Agent dated April 5 2019 (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K (Commission File No. 001-35257) filed on April 8 2019).\n10.2\tSeparation and Release Agreement dated April 24 2019 by and among American Midstream GP LLC Lynn L. Bourdon III and for purposes of Section 3 and Section 16 only LB3 Services (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K (Commission File No. 001-35257) filed on April 30 2019).\n", "q10k_tbl_50": "31.1*\tCertification of Eric T. Kalamaras Acting Principal Executive Officer of American Midstream GP LLC the General Partner of American Midstream Partners LP for the March 31 2019 Quarterly Report on Form 10-Q pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.\n31.2*\tCertification of Eric T. Kalamaras Senior Vice President & Chief Financial Officer of American Midstream GP LLC the General Partner of American Midstream Partners LP by March 31 2019 Quarterly Report on Form 10-Q pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.\n32.1**\tCertification of Eric T. Kalamaras Acting Principal Executive Officer of American Midstream GP LLC the General Partner of American Midstream Partners LP by March 31 2019 Quarterly Report on Form 10-Q pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.\n32.2**\tCertification of Eric T. Kalamaras Senior Vice President & Chief Financial Officer of American Midstream GP LLC the General Partner of American Midstream Partners LP by March 31 2019 Quarterly Report on Form 10-Q pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.\n", "q10k_tbl_51": "**101.INS\tXBRL Instance Document\n**101.SCH\tXBRL Taxonomy Extension Schema Document\n**101.CAL\tXBRL Taxonomy Extension Calculation Linkbase Document\n**101.DEF\tXBRL Taxonomy Extension Definition Linkbase Document\n**101.LAB\tXBRL Taxonomy Extension Label Linkbase Document\n**101.PRE\tXBRL Taxonomy Extension Presentation Linkbase Document\n*\tFiled herewith.\n**\tFurnished herewith.\n***\tCertain schedules have been omitted pursuant to Item 601(a)(5) of Regulation S-K. A copy of any omitted schedule will be furnished supplementally to the SEC upon request.\n"}{"bs": "q10k_tbl_3", "is": "q10k_tbl_4", "cf": "q10k_tbl_7"}None
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
Item 3. Quantitative and Qualitative Disclosures About Market Risk
Item 4. Controls and Procedures
Part II. Other Information
Item 1. Legal Proceedings
Item 1A. Risk Factors
Item 5. Other Information
Item 6. Exhibits
Exhibits
EX-3.15
amidgpresolutions-amendno1.htm
EX-31.1
a2019q1exhibit311302certif.htm
EX-31.2
a2019q1exhibit312302certif.htm
EX-32.1
a2019q1exhibit321906certif.htm
EX-32.2
a2019q1exhibit322906certif.htm
American Midstream Partners Earnings 2019-03-31
Balance Sheet
Income Statement
Cash Flow
Assets, Equity
Rev, G Profit, Net Income
Ops, Inv, Fin
10-Q 1 a2019q1form10-q.htm 10-Q Document
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
x
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2019
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: 001-35257
AMERICAN MIDSTREAM PARTNERS, LP
(Exact name of registrant as specified in its charter)
Delaware
27-0855785
(State or other jurisdiction of incorporation or organization)
(I.R.S. Employer Identification No.)
2103 CityWest Boulevard
Building #4, Suite 800
Houston, TX 77042
(346) 241-3400
(Address of principal executive offices) (zip code)
(Registrant’s telephone number, including area code)
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. ý 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). ý Yes ¨ No
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, 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
ý
Non-accelerated filer
¨
Smaller 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 Exchange Act). ¨ Yes ý No
Securities registered pursuant to section 12(b) of the Act
Title of each class
Trading Symbol(s)
Name of each exchange on which registered
Common Units representing Limited Partnership Interests
AMID
New York Stock Exchange
There were 54,451,306 common units, 11,342,197 Series A Units and 9,514,330 Series C Units of American Midstream Partners, LP outstanding as of May 3, 2019.
Glossary of Terms
The following is a list of terms used throughout this report:
ASC Accounting Standards Codification.
Bbl Barrels: 42 U.S. gallons measured at 60 degrees Fahrenheit.
Condensate
Liquid hydrocarbons present in casing head gas that condense within the gathering system and are removed prior to delivery to the natural gas plant. This product is generally sold on terms more closely tied to crude oil pricing.
/d
Per day.
FASB Financial Accounting Standards Board.
FERC Federal Energy Regulatory Commission.
GAAP Accounting principles generally accepted in the United States of America.
Gal Gallons.
Mgal Thousand gallons.
Mcf Thousand cubic feet.
MMcf Million cubic feet.
NGL or NGLs
Natural gas liquid(s): The combination of ethane, propane, normal butane, isobutane and natural gasoline that, when removed from natural gas, become liquid under various levels of higher pressure and lower temperature.
Throughput
The volume transported or passing through a pipeline, plant, terminal or other facility during a particular period.
Adjustments to reconcile net loss to net cash (used in) provided by operating activities:
Depreciation, amortization and accretion
21,180
21,997
Amortization of operating leases
1,407
—
Amortization of debt issuance costs
2,549
1,316
Amortization of weather derivative premium
247
278
Unrealized (gain) loss on derivatives contracts, net
3,037
(5,112
)
Non-cash compensation expense
1,026
1,014
Loss (gain) on sale of assets
55
(95
)
Other non-cash items
7
(15
)
Impairment of long-lived assets
829
—
Earnings in unconsolidated affiliates
(26,110
)
(12,673
)
Distributions from unconsolidated affiliates
29,866
12,673
Bad debt (recovery) expense
(80
)
87
Deferred tax benefit
—
151
Changes in operating assets and liabilities:
Accounts receivable
(11,918
)
7,251
Inventory
(7,738
)
(3,399
)
Other current assets
1,312
(4,174
)
Other assets, net
(2,546
)
—
Accounts payable
8,170
11,200
Accrued gas and crude oil purchases
(2,278
)
(4,431
)
Accrued expenses and other current liabilities
(4,096
)
2,623
Asset retirement obligations
(569
)
(6
)
Other liabilities
(5,453
)
—
Net cash (used in) provided by operating activities
(4,240
)
14,847
Cash flows from investing activities
Contributions to unconsolidated affiliates
—
(987
)
Additions to property, plant and equipment and other
(18,761
)
(25,946
)
Proceeds from disposals of assets and business
—
8
Distributions from unconsolidated affiliates, return of capital
12,280
11,181
Net cash used in investing activities
(6,481
)
(15,744
)
8
American Midstream Partners, LP and Subsidiaries
Condensed Consolidated Statements of Cash Flows (Continued)
(Unaudited, in thousands)
Three months ended March 31,
2019
2018
Cash flows from financing activities
Contributions
—
9,870
Distributions
—
(22,035
)
Contribution from noncontrolling interest owners
3
—
Distributions to noncontrolling interests owners
(33
)
(20
)
LTIP tax netting unit repurchase
(148
)
(703
)
Payments of financing leases
(268
)
—
Payment of debt issuance costs
(61
)
(1,085
)
Payment of long-term debt
(559
)
(507
)
Payment of 3.97% Senior Notes
(451
)
(439
)
Payments of other debt
(1,576
)
(1,893
)
Payments of credit agreement
(33,000
)
(119,700
)
Borrowings on credit agreement
52,500
134,400
Other
406
338
Net cash provided by (used in) financing activities
16,813
(1,774
)
Net increase (decrease) in cash, cash equivalents and restricted cash
6,092
(2,671
)
Cash, cash equivalents and restricted cash, beginning of period
45,020
34,179
Cash, cash equivalents and restricted cash, end of period
$
51,112
$
31,508
Cash, cash equivalents and restricted cash, beginning of period
Cash and cash equivalents
$
9,069
$
8,782
Restricted cash - current
30,868
20,352
Restricted cash - non-current
5,083
5,045
Total cash, cash equivalents and restricted cash, beginning of period
$
45,020
$
34,179
Cash, cash equivalents and restricted cash, end of period
Cash and cash equivalents
$
12,273
$
8,191
Restricted cash - current
33,558
18,269
Restricted cash - non-current
5,281
5,048
Total cash, cash equivalents and restricted cash, end of period
$
51,112
$
31,508
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
9
American Midstream Partners, LP and Subsidiaries
Notes to Condensed Consolidated Financial Statements (Continued)
(Unaudited)
(1) Organization and Basis of Presentation
Organization
American Midstream Partners, LP (together with its consolidated subsidiaries, the “Partnership,” “we,” “us” or “our”) is a Delaware limited partnership that was formed in August 2009 to own, operate, develop and acquire a diversified portfolio of midstream energy assets. The Partnership’s general partner, American Midstream GP, LLC (the “General Partner”), is 86% directly owned by High Point Infrastructure Partners, LLC (“HPIP”) and 14% indirectly owned by Magnolia Infrastructure Holdings, LLC (“Magnolia”), both of which are affiliates of ArcLight Capital Partners, LLC (“ArcLight”). Our capital accounts consist of notional General Partner units and units representing limited partner interests.
We provide critical midstream infrastructure that links producers of natural gas, crude oil, NGLs, condensate and specialty chemicals to numerous intermediate and end-use markets through our four reportable segments, (1) Gas Gathering and Processing Services, (2) Liquid Pipelines and Services, (3) Natural Gas Transportation Services and (4) Offshore Pipelines and Services.
On March 17, 2019, as recommended by the conflicts committee (the “Conflicts Committee”) of the board of directors (the “Board”) of our General Partner, the Partnership and our General Partner entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Anchor Midstream Acquisition, LLC, a Delaware limited liability company (“Proposed Parent”), Anchor Midstream Merger Sub, LLC, a Delaware limited liability company (“Proposed Merger Sub”), and HPIP, pursuant to which Proposed Merger Sub will merge with and into the Partnership, with the Partnership surviving as a direct wholly owned subsidiary of our General Partner and Proposed Parent (the “Pending Merger”). For further information regarding the Merger Agreement, see our Annual Report on Form 10-K for the year ended December 31, 2018 (the “2018 Form 10-K”).
On June 16, 2018, we entered into a definitive agreement for the sale of our marine liquids terminals (“Marine Products”) which was completed on July 31, 2018. On November 15, 2018, we entered into a definitive agreement for the sale of our refined products terminals (“Refined Products”) which was completed on December 20, 2018. Subsequent to the disposition of Refined Products, we eliminated our Terminalling Services segment. For further discussion of all changes made to our reporting segments in 2018, see our 2018 Form 10-K.
Basis of presentation
The accompanying condensed consolidated financial statements are unaudited and have been prepared in accordance with Article 10 of Regulation S-X for interim financial information. Accordingly, they do not include all the information and notes required by GAAP for complete financial statements. In the opinion of our management, all adjustments, consisting only of normal recurring adjustments, considered necessary for a fair statement have been included. The results of operations for interim periods are not necessarily indicative of results of operations for a full year. These condensed consolidated financial statements should be read in conjunction with our consolidated financial statements and notes thereto included in our 2018 Form 10-K.
Going Concern Assessment and Management’s Plans
Pursuant to FASB ASC 205-40, Presentation of Financial Statements – Going Concern (Subtopic 205-40): Disclosure of Uncertainties About an Entity's Ability to Continue as a Going Concern, we are required to assess our ability to continue as a going concern for a period of one year from the date of the issuance of these condensed consolidated financial statements. Substantial doubt about an entity’s ability to continue as a going concern exists when relevant conditions and events, considered in the aggregate, indicate that it is probable that the entity will be unable to meet its obligations as they become due within one year from the financial statement issuance date. The Credit Agreement matures on September 5, 2019 and has not been renewed as of the date of the issuance of these condensed consolidated financial statements.
On September 27, 2018, the Board received a non-binding proposal from Magnolia, an affiliate of ArcLight to acquire the common units that it does not already own. On March 17, 2019, we entered into the Merger Agreement and expect the Pending Merger to close by the outside date under the Merger Agreement of July 31, 2019. As the Merger Agreement is subject to customary closing conditions and because the Pending Merger may affect how, or if, the Partnership elects to obtain a maturity extension, management has deferred addressing the Credit Agreement.
While we intend to renew or extend the terms of the Credit Agreement, until such time as we have executed an agreement to refinance or extend the maturity of the Credit Agreement, we cannot conclude that it is probable we will do so, and accordingly, this raises substantial doubt about our ability to continue as a going concern.
10
American Midstream Partners, LP and Subsidiaries
Notes to Condensed Consolidated Financial Statements (Continued)
(Unaudited)
(2) Recent Accounting Pronouncements and Critical Accounting Policies
Standards Adopted in 2019
Leases (Topic 842) - In February 2016, the FASB issued ASU No. 2016-02 (“Topic 842”) Leases , which supersedes the lease recognition requirements in ASC 840, Leases. Under the new guidance, for leases with a term longer than 12 months, a lessee should recognize a lease liability and a right-of-use (“ROU”) asset representing its right to use the underlying asset for the lease term. Topic 842 retains a classification distinction between finance leases and operating leases, with the classification affecting the pattern of expense recognition in the income statement. This ASU also requires enhanced disclosures.
In 2018, the FASB issued ASU No. 2018-01, Land Easement Practical Expedient for Transition to Topic 842 and ASU No. 2018-11, Targeted Improvements. Under these updates, optional transition practical expedients are available (1) whereby existing or expired land easements that were not previously accounted for as leases under ASC 840 are not required to be evaluated under Topic 842 and (2) lease and associated non-lease components are not required to be separated within lessor arrangements if certain criteria are met. The FASB also issued ASUs 2018-10 and 2018-20, Codification Improvements to Topic 842 and Narrow Scope Improvements for Lessors, respectively, to alleviate unintended consequences from applying Topic 842. The amendments do not make substantive changes to the core provisions or principles of Topic 842 and did not significantly impact our implementation process.
We adopted the new standard on its effective date, January 1, 2019 using the modified retrospective approach. We elected the package of practical expedients permitted under the transition guidance within Topic 842 which, among other things, allows us to carry forward the historical lease classification. As such, we did not reassess (1) whether any expired or existing contracts are or contain leases, (2) the lease classification for any expired or existing leases, and (3) any initial direct costs for any existing leases as of the effective date. We also elected the practical expedient related to land easements, allowing us to carry forward our accounting treatment for land easements on existing agreements. We did not elect the hindsight practical expedient which permits entities to use hindsight in determining the lease term and assessing impairment of ROU assets.
Additionally, we elected certain practical expedients on an ongoing basis, including the practical expedient for short-term leases pursuant to which a lessee is permitted to make an accounting policy election by class of underlying asset not to recognize a lease liability and ROU asset for leases (1) with a term of 12 months or less and (2) that do not include an option to purchase the underlying asset that the lessee is reasonably certain to exercise. Instead, we will recognize the lease payments for short-term leases within profit and loss on a straight-line basis over the lease term and variable lease payments in the period in which the obligation for those payments is incurred. Substantially all leases where we are a lessee are classified as operating leases under Topic 842. Topic 842 did not have a material effect on our condensed consolidated financial statements from a lessor perspective.
On adoption, we recognized ROU assets and additional lease liabilities of approximately $29.1 million and $33.4 million, respectively.
Standards Not Yet Adopted
Financial Instruments - In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”). This guidance will become effective for interim and annual periods beginning after December 15, 2019. We expect to adopt ASU 2016-13 on January 1, 2020, and we are currently evaluating the effect that adopting this guidance will have on our consolidated financial position, results of operations and cash flows.
Fair Value Measurement - In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurements (Topic 820): Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement (“ASU 2018-13”). This guidance eliminates certain disclosure requirements for fair value measurements for all entities, requires public entities to disclose certain new information and modifies certain disclosure requirements. The FASB developed the amendments to Topic 820 as part of its broader disclosure framework project, which aims to improve the effectiveness of disclosures in the notes to financial statements by focusing on requirements that clearly communicate the most important information to users of the financial statements. This guidance will become effective for interim and annual periods beginning after December 15, 2019. We expect to adopt ASU 2018-13 on January 1, 2020, and we are currently evaluating the impact, if any, that adopting this guidance will have on our disclosures.
Cloud Computing Arrangements - In August 2018, the FASB issued ASU No. 2018-15, Customer's Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement that is a Service Contract ("ASU 2018-15"). The ASU aligns the requirements
11
American Midstream Partners, LP and Subsidiaries
Notes to Condensed Consolidated Financial Statements (Continued)
(Unaudited)
for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software. The capitalized implementation costs of a hosting arrangement that is a service contract will be expensed over the term of the hosting arrangement. ASU 2018-15 is effective for annual and interim periods beginning after December 15, 2019. Early adoption is permitted, including adoption in any interim period. The amendments can be applied either retrospectively or prospectively to all implementation costs incurred after the adoption date. We expect to adopt ASU 2018-15 on January 1, 2020, and we are currently evaluating the effect that adopting this guidance will have on our consolidated financial position, results of operations and cash flows.
(3) Revenue Recognition
Disaggregated Revenue
The following table presents our segment revenues from contracts with customers disaggregated by type of activity (in thousands):
Three months ended March 31, 2019
Gas Gathering and Processing Services
Liquid Pipelines and Services
Natural Gas Transportation Services
Offshore Pipelines and Services
Terminalling Services
Total
Commodity sales:
Natural gas
$
1,576
$
—
$
6,407
$
2,286
$
—
$
10,269
NGLs
13,901
—
—
—
—
13,901
Condensate
8,776
—
—
131
—
8,907
Crude oil
—
104,322
—
—
—
104,322
Other sales
83
—
1
46
—
130
24,336
104,322
6,408
2,463
—
137,529
Services:
Gathering and processing
4,059
—
—
300
—
4,359
Transportation
332
2,311
8,714
9,042
—
20,399
Terminalling and storage
—
150
—
—
—
150
Other services (1)
744
44
65
5,041
—
5,894
5,135
2,505
8,779
14,383
—
30,802
Revenues from contracts with customers
$
29,471
$
106,827
$
15,187
$
16,846
$
—
$
168,331
12
American Midstream Partners, LP and Subsidiaries
Notes to Condensed Consolidated Financial Statements (Continued)
(Unaudited)
Three months ended March 31, 2018
Gas Gathering and Processing Services
Liquid Pipelines and Services
Natural Gas Transportation Services
Offshore Pipelines and Services
Terminalling Services
Total
Commodity sales:
Natural gas
$
1,906
$
—
$
6,637
$
2,437
$
—
$
10,980
NGLs
21,150
—
—
38
—
21,188
Condensate
5,648
—
—
34
—
5,682
Crude oil
—
115,782
—
—
—
115,782
Other sales
184
—
4
39
5,004
5,231
28,888
115,782
6,641
2,548
5,004
158,863
Services:
Gathering and processing
2,365
—
—
866
—
3,231
Transportation
630
3,062
9,412
8,663
—
21,767
Terminalling and storage
—
1,440
—
—
10,393
11,833
Other services (1)
434
402
10
4,613
562
6,021
3,429
4,904
9,422
14,142
10,955
42,852
Revenues from contracts with customers
$
32,317
$
120,686
$
16,063
$
16,690
$
15,959
$
201,715
_________________________
(1) Other services in our Offshore Pipelines and Services segment include asset management services.
Other Items in Revenue
The following table presents the reconciliation of our revenues from contracts with customers to segment revenues and total revenues as disclosed in our Condensed Consolidated Statements of Operations (in thousands):
Three months ended March 31, 2019
Gas Gathering and Processing Services
Liquid Pipelines and Services
Natural Gas Transportation Services
Offshore Pipelines and Services
Terminalling Services
Total
Revenues from contracts with customers
$
29,471
$
106,827
$
15,187
$
16,846
$
—
$
168,331
Revenues generated through operating lease arrangements(1)(2)
5,738
—
—
282
—
6,020
Loss on commodity derivatives, net
—
(1,521
)
—
—
—
(1,521
)
Total revenues of reportable segments
$
35,209
$
105,306
$
15,187
$
17,128
$
—
$
172,830
Three months ended March 31, 2018
Gas Gathering and Processing Services
Liquid Pipelines and Services
Natural Gas Transportation Services
Offshore Pipelines and Services
Terminalling Services
Total
Revenues from contracts with customers
$
32,317
$
120,686
$
16,063
$
16,690
$
15,959
$
201,715
Revenues generated through operating lease arrangements(1)(2)
3,884
—
—
170
—
4,054
Gain on commodity derivatives, net
2
58
—
—
—
60
Total revenues of reportable segments
$
36,203
$
120,744
$
16,063
$
16,860
$
15,959
$
205,829
_________________________
(1) When providing gathering or processing services to customers, specific facilities where one customer obtains substantially all of the economic benefits from the asset and has the right to direct the use of the asset are considered leased to the customer. Under the transition guidance with Topic 842, we have carried forward the historical classification of these arrangements as operating leases.
13
American Midstream Partners, LP and Subsidiaries
Notes to Condensed Consolidated Financial Statements (Continued)
(Unaudited)
(2) Offshore Pipelines and Services includes approximately $0.2 million in 2019 and $0.1 million in 2018 in leasing revenues related to a platform arrangement with our unconsolidated affiliate, Delta House Oil & Gas Lateral LLC.
We may utilize derivative instruments in connection with contracts with customers. We purchase and take title to a portion of the NGLs and crude oil that we sell, which may expose us to changes in the price of these products in our sales markets. We do not take title to the natural gas we transport and therefore have no direct commodity price exposure to natural gas.
Contract Balances
Our contract assets and liabilities primarily relate to contracts where allocations of the transaction prices result in differences to the pattern and timing of revenue recognition as compared to contractual billings. Where payments are received in advance of recognition as revenue, contract liabilities are created. Where we have earned revenue and our right to invoice the customer is conditioned on something other than the passage of time, contract assets are created.
The following table presents the change in the contract assets and liability balances during the three months ended March 31, 2019 (in thousands):
Contract Assets
Contract Liabilities
Balance at December 31, 2018
$
8,838
$
15,614
Amounts recognized as revenue
(109
)
(367
)
Additions
2,546
883
Balances at March 31, 2019
$
11,275
$
16,130
Current
$
252
$
606
Non-current
11,023
15,524
Balances at March 31, 2019
$
11,275
$
16,130
Remaining Performance Obligations
The following table as of March 31, 2019, represents only revenue expected to be recognized from contracts with customers where the price and quantity of the product or service are fixed:
Remainder of 2019
2020
2021
2022
2023
Thereafter
Total
Gathering and processing based on minimum volume commitments
$
9,299
$
12,399
$
12,399
$
12,399
$
12,399
$
5,928
$
64,823
Transportation agreements
16,796
22,141
21,140
20,912
20,912
181,737
283,638
Other
1,225
1,560
—
—
—
—
2,785
Total
$
27,320
$
36,100
$
33,539
$
33,311
$
33,311
$
187,665
$
351,246
Due to the application of the practical expedients, the table above represents only a portion of the Partnership’s expected future consolidated revenues and it is not necessarily indicative of the expected trend in total revenues for the Partnership. Certain contracts have not been presented in the table above due to the term being one year or less and due to variability in the amount of performance obligation remaining, variability in the timing of recognition or variability in consideration. Acreage dedications do require us to perform future services but do not contain a minimum level of services and are therefore excluded from this presentation. Long-term supply and logistics arrangements contain variable timing, volumes and/or consideration and are excluded from this presentation. The table above also excludes revenue generated through operating lease arrangements.
(4) Lessee Arrangements
We primarily lease real estate including land and buildings, equipment, and vehicles. Leases of real estate generally require us to pay property taxes, insurance, and maintenance. Substantially all of our leases are classified as operating leases. ROU assets and lease liabilities for operating leases are included in Other assets, net, Accrued expenses and other current liabilities, and Other long-term liabilities in our consolidated balance sheets, depending on timing of settlement. For finance leases, the ROU assets
14
American Midstream Partners, LP and Subsidiaries
Notes to Condensed Consolidated Financial Statements (Continued)
(Unaudited)
and lease liabilities are included in Property, plant and equipment, net, Current portion of long-term debt, and Long-term debt in our condensed consolidated balance sheets, depending on timing of settlement.
An ROU asset represents our right to use an underlying asset for the lease term and the corresponding lease liability represents our obligation to make lease payments arising from the lease. ROU assets and lease liabilities are recognized at the commencement date based on the present value of lease payments over the lease term. As our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at the commencement date in determining the present value of lease payments. The ROU asset also includes any lease prepayments and excludes lease incentives. Our lease contracts may include options to extend or terminate the lease which are included in the measurement of our lease liability when it is reasonably certain that we will exercise the option. Certain vehicle leases provide for guarantees of residual value; therefore, we estimate and include in the determination of lease payments any amount probable of being owed under these residual value guarantees.
We apply a portfolio approach by asset class to apply the provisions of ASC 842. Lease renewal terms vary from 30 days to 5 years for asset classes such as equipment and vehicles, and up to 15 years or more for real estate. Short term leases with an initial term of 12 months or less that do not include a purchase option are not recorded on the balance sheet. Lease expense for short-term leases are recognized on a straight-line basis over the lease term and amounts related to short-term leases are disclosed within our financial statements. We have variable lease payments, including adjustments to lease payments based on an index or rate; such as a consumer price index, fair value adjustments to lease payments, and common area maintenance, real estate taxes, and insurance payments in triple-net real estate leases.
The following table presents the components of lease cost (in thousands):
Three months ended March 31, 2019
Finance lease cost
Amortization of right-of-use assets
$
206
Interest on lease liabilities
38
Total finance lease cost
$
244
Operating lease cost
$
1,780
Short-term and variable lease cost
2
Sublease income
(547
)
Total operating lease cost
$
1,235
Amounts reported in the Condensed Consolidated Balance Sheets for leases where we are the lessee were as follows (in thousands):
15
American Midstream Partners, LP and Subsidiaries
Notes to Condensed Consolidated Financial Statements (Continued)
(Unaudited)
March 31, 2019
Operating leases
Other assets, net
$
26,628
Accrued expenses and other current liabilities
$
6,589
Other long-term liabilities
24,974
Total operating lease liabilities
$
31,563
Finance leases
Property, plant and equipment, net
$
2,428
Current portion of long-term debt
$
841
Long-term debt
1,629
Total finance lease liabilities
$
2,470
Weighted average remaining lease term
Operating leases
13.8 years
Finance leases
9.4 years
Weighted average discount rate
Operating leases
5.0
%
Finance leases
6.7
%
16
American Midstream Partners, LP and Subsidiaries
Notes to Condensed Consolidated Financial Statements (Continued)
(Unaudited)
Maturity of Lease Liabilities (thousands)
Operating Leases
Finance Leases
Total
2019
$
6,061
$
742
$
6,803
2020
6,559
844
7,403
2021
4,056
611
4,667
2022
2,451
372
2,823
2023
1,780
163
1,943
2024
1,696
—
1,696
Thereafter
22,853
15
22,868
Total lease payments
45,456
2,747
48,203
Imputed interest (a)
(13,893
)
(277
)
(14,170
)
Total lease liabilities (b)
$
31,563
$
2,470
$
34,033
___________________________
(a) Calculated using the interest rate for each lease.
(b) Includes the current portion of $6.6 million for operating leases and $0.8 million for finance leases
At December 31, 2018, our non-cancelable contractual commitments related to operating lease obligations totaled $36.8 million. Operating lease commitments over the next five years and thereafter were as follows: $7.3 million in 2019, $4.5 million in 2020, $3.0 million in 2021, $1.5 million in 2022, $1.0 million in 2023 and $19.5 million thereafter.
Other Information
Three months ended March 31, 2019
Cash paid for amounts included in the measurement of lease liabilities:
Cash paid for operating leases, including interest portion of finance leases
$
1,868
Cash paid for principal portion of finance leases
$
268
Right-of-use assets obtained in exchange for lease obligations:
Operating leases
$
2,206
Finance leases
$
82
(5) Inventory
Inventory consists of the following (in thousands):
March 31, 2019
December 31, 2018
Crude oil
$
8,526
$
830
NGLs
278
236
Materials, supplies and equipment
120
120
Total inventory
$
8,924
$
1,186
(6) Risk Management Activities
We are exposed to certain market risks related to the volatility of commodity prices and changes in interest rates. To monitor and manage these market risks, we have established comprehensive risk management policies and procedures. We do not enter into derivative instruments for any purpose other than hedging commodity price risk, interest rate risk and weather risk. We do not speculate using derivative instruments. For more information regarding our risk management activities, see Note 1. Organization, Basis of Presentation and Summary of Significant Accounting Policies and Note 8. Risk Management Activities in our 2018 Form 10-K.
17
American Midstream Partners, LP and Subsidiaries
Notes to Condensed Consolidated Financial Statements (Continued)
(Unaudited)
The following table summarizes the net notional volumes of our outstanding commodity-related derivatives, excluding those contracts that qualified for the NPNS exception as of March 31, 2019 and December 31, 2018, none of which were designated as hedges for accounting purposes.
March 31, 2019
December 31, 2018
Commodity Swaps
Volume
Maturity
Volume
Maturity
Crude Oil Basis (barrels)
100,000
May 2019
208,000
February 2019
Financial Instruments Measured at Fair Value on a Recurring Basis - The following table summarizes the fair values of our derivative contracts included in the Condensed Consolidated Balance Sheets (in thousands):
Asset Derivatives
Liability Derivatives
Type
Balance Sheet Classification
March 31, 2019
December 31, 2018
March 31, 2019
December 31, 2018
Commodity derivatives
Accrued expenses and other current liabilities
—
(256
)
(2
)
Interest rate swaps
Other current assets
3,521
4,314
—
—
Interest rate swaps
Other assets, net
4,027
6,017
—
—
Weather derivatives
Other current assets
206
454
—
—
Total
$
7,754
$
10,785
$
(256
)
$
(2
)
As of March 31, 2019, and December 31, 2018, we had a combined notional principal amount of $450.0 million and $550.0 million, respectively, of variable-to-fixed interest rate swap agreements. As of March 31, 2019, the maximum length of time over which we have hedged a portion of our exposure due to interest rate risk is through December 31, 2022.
The fair value of our interest rate swaps was estimated based upon forward interest rates and volatility curves as well as other relevant economic measures, if necessary. Discount factors may be utilized to extrapolate a forecast of future cash flows associated with long dated transactions. The inputs, which represent Level 2 inputs in the valuation hierarchy, are obtained from independent pricing services and we have made no adjustments to those prices. The carrying value of our weather derivative represents its fair value due to the short term nature of the underlying contract.
The carrying value of all nonderivative financial instruments included in current assets (including cash and cash equivalents, restricted cash and accounts receivable) and current liabilities (excluding current portion of long-term debt) approximates the applicable fair value due to the short maturity of those instruments.
For the three months ended March 31, 2019 and 2018, the realized and unrealized gains (losses) associated with our commodity, interest rate and weather derivative instruments were recorded in our Condensed Consolidated Statements of Operations as follows (in thousands):
Three months ended March 31,
Realized
Unrealized
2019
Loss on commodity derivatives, net
$
(1,267
)
$
(254
)
Interest expense, net of capitalized interest
807
(2,783
)
Direct operating expenses
(248
)
—
Total
$
(708
)
$
(3,037
)
2018
Gain (loss) on commodity derivatives, net
$
119
$
(59
)
Interest expense, net of capitalized interest
1,350
5,171
Direct operating expenses
(278
)
—
Total
$
1,191
$
5,112
18
American Midstream Partners, LP and Subsidiaries
Notes to Condensed Consolidated Financial Statements (Continued)
(Unaudited)
(7) Goodwill and Intangible Assets
Goodwill consists of the following (in thousands):
March 31, 2019
December 31, 2018
Liquid Pipelines and Services
$
46,749
$
46,749
Offshore Pipelines and Services
4,974
4,974
Total
$
51,723
$
51,723
Intangible assets, net, consist of the following (in thousands):
March 31, 2019
Gross Carrying Amount
Accumulated Amortization
Net Carrying Amount
Customer relationships
$
64,744
$
(17,775
)
$
46,969
Customer contracts
94,692
(54,402
)
40,290
Dedicated acreage
42,547
(7,935
)
34,612
Collaborative arrangements
11,884
(2,476
)
9,408
Other
198
(30
)
168
Total
$
214,065
$
(82,618
)
$
131,447
December 31, 2018
Gross Carrying Amount
Accumulated Amortization
Net Carrying Amount
Customer relationships
$
64,744
$
(17,033
)
$
47,711
Customer contracts
94,692
(53,156
)
41,536
Dedicated acreage
42,547
(7,592
)
34,955
Collaborative arrangements
11,884
(2,264
)
9,620
Other
198
(28
)
170
Total
$
214,065
$
(80,073
)
$
133,992
These intangible assets have definite lives and are subject to amortization on a straight-line basis over their economic lives, currently ranging from approximately 5 years to 30 years.
Amortization expense related to our intangible assets totaled $2.5 million and $2.7 million for the three months ended March 31, 2019 and 2018, respectively. The estimated aggregate amortization expected to be recognized for the remainder of 2019 and each of the four succeeding fiscal years is $7.6 million, $10.2 million, $10.2 million, $9.3 million and $6.6 million, respectively.
(8) Investments in unconsolidated affiliates
The following table presents the activity in our equity method investments in unconsolidated affiliates (in thousands):
(1) Represents direct and indirect ownership interests in Class A units and common units.
19
American Midstream Partners, LP and Subsidiaries
Notes to Condensed Consolidated Financial Statements (Continued)
(Unaudited)
(2) FPS denotes Floating Production System LLC whereas OGL denotes Oil & Gas Lateral LLC.
(3) Included in our Liquid Pipelines and Services segment.
(4) Included in our Offshore Pipelines and Services segment.
(5) Reflects a reclassification of investment of approximately $0.4 million between FPS and OGL as of January 1, 2019.
The difference between our carrying value and the underlying equity in the net assets of our equity investments are assigned to the investment's assets and liabilities based on an analysis of the factors giving rise to the basis difference. The amortization of the basis difference is included in Earnings from unconsolidated affiliates in our Consolidated Statements of Operations.
The following table represents the basis difference by unconsolidated affiliate (in thousands):
Delta House
FPS
OGL
Destin
Tri-States
Okeanos
Wilprise
Cayenne
Total
December 31, 2018
$
41,762
$
(8,424
)
$
826
$
30,587
$
(57,039
)
$
1,374
$
(3,666
)
$
5,420
March 31, 2019
$
41,343
$
(8,338
)
$
812
$
30,210
$
(56,164
)
$
1,346
$
(3,599
)
$
5,610
The following tables present the summarized combined financial information for our equity investments (amounts represent 100% of investee financial information) (in thousands):