Cover Page
Cover Page - shares | 6 Months Ended | |
Jun. 30, 2021 | Jul. 30, 2021 | |
Entity Information [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Jun. 30, 2021 | |
Document Transition Report | false | |
Entity File Number | 001-35721 | |
Entity Registrant Name | DELEK LOGISTICS PARTNERS, LP | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 45-5379027 | |
Entity Address, Address Line One | 7102 Commerce Way | |
Entity Address, City or Town | Brentwood | |
Entity Address, State or Province | TN | |
Entity Address, Postal Zip Code | 37027 | |
City Area Code | 615 | |
Local Phone Number | 771-6701 | |
Title of 12(b) Security | Common Units Representing Limited Partnership Interests | |
Trading Symbol | DKL | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Partnership Units Outstanding | 43,453,433 | |
Entity Central Index Key | 0001552797 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2021 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Jun. 30, 2021 | Dec. 31, 2020 |
Current assets: | ||
Cash and cash equivalents | $ 2,173 | $ 4,243 |
Accounts receivable | 18,065 | 15,676 |
Accounts receivable from related parties | 0 | 5,932 |
Inventory | 1,988 | 3,127 |
Other current assets | 900 | 331 |
Total current assets | 23,126 | 29,309 |
Property, plant and equipment: | ||
Property, plant and equipment | 701,823 | 692,282 |
Less: accumulated depreciation | (247,072) | (227,470) |
Property, plant and equipment, net | 454,751 | 464,812 |
Equity method investments | 252,048 | 253,675 |
Operating lease right-of-use assets | 25,051 | 24,199 |
Goodwill | 12,203 | 12,203 |
Marketing Contract Intangible, net | 120,182 | 123,788 |
Right-of-way | 36,991 | 36,316 |
Other non-current assets | 11,124 | 12,115 |
Total assets | 935,476 | 956,417 |
Current liabilities: | ||
Accounts payable | 4,836 | 6,659 |
Accounts payable to related parties | 36,847 | 0 |
Interest Payable | 5,441 | 2,452 |
Excise and other taxes payable | 4,560 | 4,969 |
Current portion of operating lease liabilities | 8,014 | 8,691 |
Accrued expenses and other current liabilities | 7,829 | 5,529 |
Total current liabilities | 67,527 | 28,300 |
Non-current liabilities: | ||
Long-term debt | 928,728 | 992,291 |
Asset retirement obligations | 6,245 | 6,015 |
Operating lease liabilities, net of current portion | 16,976 | 15,418 |
Other non-current liabilities | 23,847 | 22,694 |
Total non-current liabilities | 975,796 | 1,036,418 |
Equity (Deficit): | ||
Total equity (deficit) | (107,847) | (108,301) |
Total liabilities and deficit | 935,476 | 956,417 |
Common unitholders | Common- Public [Member] | ||
Equity (Deficit): | ||
Total equity (deficit) | 164,678 | 164,614 |
Common unitholders | Common- Delek [Member] | ||
Equity (Deficit): | ||
Total equity (deficit) | $ (272,525) | $ (272,915) |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Unaudited) (Parentheticals) - shares | Jun. 30, 2021 | Dec. 31, 2020 |
Common unitholders - public | ||
Common unitholders, units issued | 8,707,565 | 8,697,468 |
Common unitholders, units outstanding | 8,707,565 | 8,697,468 |
Common unitholders - Delek | ||
Common unitholders, units issued | 34,745,868 | 34,745,868 |
Common unitholders, units outstanding | 34,745,868 | 34,745,868 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Income and Comprehensive Income (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | ||
Net revenues: | |||||
Affiliates (1) | [1] | $ 88,722 | $ 87,629 | $ 184,916 | $ 194,328 |
Third party | 79,756 | 30,008 | 136,475 | 86,710 | |
Net Revenues | 168,478 | 117,637 | 321,391 | 281,038 | |
Cost of sales: | |||||
Cost of materials and other | 88,695 | 43,892 | 169,866 | 145,185 | |
Operating expenses (excluding depreciation and amortization presented below) | 14,876 | 11,623 | 28,371 | 25,577 | |
Depreciation and amortization | 9,480 | 8,223 | 19,727 | 14,026 | |
Total cost of sales | 113,051 | 63,738 | 217,964 | 184,788 | |
Operating expenses (excluding depreciation and amortization presented below) | 605 | 826 | 1,166 | 1,616 | |
General and administrative expenses | 6,077 | 4,721 | 10,937 | 10,851 | |
Depreciation and amortization | 487 | 471 | 979 | 967 | |
Other operating income, net | (136) | 0 | (219) | (107) | |
Total operating costs and expenses | 120,084 | 69,756 | 230,827 | 198,115 | |
Operating income | 48,394 | 47,881 | 90,564 | 82,923 | |
Interest expense, net | 11,658 | 10,670 | 21,395 | 22,494 | |
Income from equity method investments | (6,642) | (6,462) | (10,691) | (12,015) | |
Other income, net | (34) | (2) | (3) | (2) | |
Total non-operating expenses, net | 4,982 | 4,206 | 10,701 | 10,477 | |
Income before income tax expense (benefit) | 43,412 | 43,675 | 79,863 | 72,446 | |
Income tax expense (benefit) | 166 | (740) | 350 | 235 | |
Net income attributable to partners | 43,246 | 44,415 | 79,513 | 72,211 | |
Comprehensive income attributable to partners | 43,246 | 44,415 | 79,513 | 72,211 | |
Less: General partner's interest in net income, including incentive distribution rights | [2] | 0 | 9,647 | 0 | 18,724 |
Limited partners' interest in net income | $ 43,246 | $ 34,768 | $ 79,513 | $ 53,487 | |
Weighted average limited partner units outstanding: | |||||
Cash distributions per limited partner unit (in dollars per share) | $ 0.940 | $ 0.900 | $ 1.860 | $ 1.790 | |
Common Units | |||||
Net income per limited partner unit: | |||||
Common units - (basic) (in dollars per share) | 1 | 1.18 | 1.83 | 1.98 | |
Common units - (diluted) (in dollars per share) | $ 1 | $ 1.18 | $ 1.83 | $ 1.98 | |
Weighted average limited partner units outstanding: | |||||
Common units - (basic) (in shares) | 43,445,222 | 29,427,298 | 43,444,284 | 26,953,934 | |
Common units - (diluted) (in shares) | 43,460,366 | 29,430,555 | 43,453,806 | 26,956,523 | |
[1] | See Note 3 for a description of our material affiliate revenue transactions. | ||||
[2] | See Note 3 for a description of the IDR Restructuring Transaction. |
Condensed Consolidated Statem_2
Condensed Consolidated Statement of Partners' Equity (Deficit) (Unaudited) - USD ($) $ in Thousands | Total | Delek Trucking [Member] | General Partner | General PartnerDelek Trucking [Member] | Common unitholders - publicLimited Partner | Common unitholders - DelekLimited Partner | Common unitholders - DelekLimited PartnerDelek Trucking [Member] | |||||
Beginning balance at Dec. 31, 2019 | $ (151,119) | $ (5,042) | $ 164,436 | $ (310,513) | ||||||||
Cash distributions | (61,540) | $ (47,558) | (18,156) | $ (951) | (15,835) | (27,549) | $ (46,607) | |||||
General partner units issued to maintain 2% interest | 10 | 10 | ||||||||||
Net income attributable to partners | 72,211 | 18,724 | 16,914 | 36,573 | ||||||||
Delek Holdings Unit purchases | (4,979) | 4,979 | ||||||||||
Issuance of units in connection with the Big Spring Gathering Assets Acquisition | 109,514 | 2,190 | 107,324 | |||||||||
Partners' Capital, Other | 167 | 1 | 334 | (168) | ||||||||
Ending balance at Jun. 30, 2020 | (78,315) | (3,224) | 160,870 | (235,961) | ||||||||
Beginning balance at Mar. 31, 2020 | [1] | (44,396) | (2,785) | 158,332 | (199,943) | |||||||
Cash distributions | (30,906) | [1] | $ (47,558) | (9,139) | [1] | $ (951) | (7,753) | [1] | (14,014) | [1] | $ (46,607) | |
General partner units issued to maintain 2% interest | 4 | 4 | ||||||||||
Net income attributable to partners | 44,415 | 9,647 | 10,262 | 24,506 | ||||||||
Partners' Capital, Other | 126 | 0 | 29 | 97 | ||||||||
Ending balance at Jun. 30, 2020 | (78,315) | $ (3,224) | 160,870 | (235,961) | ||||||||
Beginning balance at Dec. 31, 2020 | (108,301) | 164,614 | (272,915) | |||||||||
Cash distributions | (79,501) | (15,916) | (63,585) | |||||||||
Net income attributable to partners | 79,513 | 15,927 | 63,586 | |||||||||
Issuance of units in connection with the Big Spring Gathering Assets Acquisition | 0 | |||||||||||
Partners' Capital, Other | 442 | 53 | 389 | |||||||||
Ending balance at Jun. 30, 2021 | (107,847) | 164,678 | (272,525) | |||||||||
Beginning balance at Mar. 31, 2021 | (111,390) | 164,100 | (275,490) | |||||||||
Cash distributions | (39,968) | (8,002) | (31,966) | |||||||||
Net income attributable to partners | 43,246 | 8,666 | 34,580 | |||||||||
Partners' Capital, Other | 265 | (86) | 351 | |||||||||
Ending balance at Jun. 30, 2021 | $ (107,847) | $ 164,678 | $ (272,525) | |||||||||
[1] | Cash distributions include a nominal amount related to distribution equivalents on vested phantom units. |
Condensed Consolidated Statem_3
Condensed Consolidated Statement of Partners' Equity (Deficit) (Unaudited) (Parentheticals) | Aug. 12, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 |
General Partnership | |||||
General partner's ownership interest (as percent) | 2.00% | 0.00% | 2.00% | 0.00% | 2.00% |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Cash Flows ( Unaudited) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2021 | Jun. 30, 2020 | |
Cash flows from operating activities: | ||
Net income | $ 79,513 | $ 72,211 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 20,706 | 14,993 |
Non-cash lease expense | 4,507 | 640 |
Amortization of customer contract intangible assets | 3,606 | 3,605 |
Amortization of deferred revenue | (911) | (945) |
Amortization of deferred financing costs and debt discount | 1,325 | 1,172 |
Income from equity method investments | (10,691) | (12,015) |
Dividends from equity method investments | 8,311 | 12,500 |
Other Noncash Expense | 453 | 1,218 |
Changes in assets and liabilities: | ||
Accounts receivable | (2,389) | (2,703) |
Inventories and other current assets | 524 | 12,182 |
Accounts payable and other current liabilities | 295 | (11,890) |
Accounts receivable/payable to related parties | 39,756 | (17,653) |
Non-current assets and liabilities, net | 2,519 | (934) |
Net cash provided by operating activities | 147,524 | 72,381 |
Cash flows from investing activities: | ||
Asset acquisitions from Delek Holdings, net of assumed liabilities | 0 | 100,527 |
Purchases of property, plant and equipment | (8,762) | (4,997) |
Proceeds from sales of property, plant and equipment | 219 | 107 |
Purchases of intangible assets | 675 | 0 |
Distributions from equity method investments | 5,400 | 1,690 |
Equity method investment contributions | (1,393) | (10,515) |
Net cash used in investing activities | (5,211) | (114,242) |
Cash flows from financing activities: | ||
Proceeds from issuance of additional units to maintain 2% General Partner interest | 0 | 10 |
Distributions to general partner | 0 | (18,156) |
Distributions to common unitholders - public | (15,916) | (15,835) |
Distributions to common unitholders - Delek Holdings | (63,585) | (27,549) |
Distributions to Delek Holdings unitholders and general partner related to Trucking Assets Acquisition | 0 | (47,558) |
Proceeds from revolving credit facility | 148,300 | 413,000 |
Payments on revolving credit facility | (606,100) | (251,400) |
Proceeds from issuance of senior notes | 400,000 | 0 |
Deferred financing costs paid in connection with debt issuances | (6,326) | 0 |
Payments on financing lease liabilities | (756) | 0 |
Net cash (used in) provided by financing activities | (144,383) | 52,512 |
Net (decrease) increase in cash and cash equivalents | (2,070) | 10,651 |
Cash and cash equivalents at the beginning of the period | 4,243 | 5,545 |
Cash and cash equivalents at the end of the period | 2,173 | 16,196 |
Cash paid during the period for: | ||
Interest | 17,081 | 21,298 |
Non-cash investing activities: | ||
Increase (decrease) in accrued capital expenditures | 1,557 | (1,317) |
Equity issuance to Delek Holdings unitholders in connection with Big Spring Gathering Assets Acquisition | 0 | 109,514 |
Non-cash financing activities: | ||
Non-cash lease liability arising from obtaining right of use assets during the period | $ 5,572 | $ 15,779 |
Condensed Consolidated Statem_5
Condensed Consolidated Statements of Cash Flows (Unaudited) (Parenthetical) | Aug. 12, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 |
General Partnership | |||||
General partner's ownership interest (as percent) | 2.00% | 0.00% | 2.00% | 0.00% | 2.00% |
Organization and Basis of Prese
Organization and Basis of Presentation | 6 Months Ended |
Jun. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Basis of Presentation | Organization and Basis of Presentation As used in this report, the terms "Delek Logistics Partners, LP," the "Partnership," "we," "us," or "our" may refer to Delek Logistics Partners, LP, one or more of its consolidated subsidiaries or all of them taken as a whole. The Partnership is a Delaware limited partnership formed in April 2012 by Delek US Holdings, Inc. ("Delek Holdings") and its subsidiary Delek Logistics GP, LLC, our general partner (our "general partner"). Effective August 13, 2020, the Partnership closed the transaction contemplated by a definitive exchange agreement with the general partner to eliminate all of the incentive distribution rights ("IDRs") held by the general partner and convert the 2% general partner interest into a non-economic general partner interest, such transaction the "IDR Restructuring Transaction." Effective May 1, 2020, the Partnership, through its wholly-owned subsidiary DKL Transportation, LLC, acquired Delek Trucking, LLC consisting of certain leased and owned tractors and trailers and related assets (the "Trucking Assets") from Delek Holdings, such transaction the "Trucking Assets Acquisition." In addition, effective March 31, 2020, the Partnership, through its wholly-owned subsidiary DKL Permian Gathering, LLC, acquired from Delek Holdings a crude oil gathering system located in Howard, Borden and Martin Counties, Texas (the "Big Spring Gathering System"), and certain related assets, such transaction the "Big Spring Gathering Assets Acquisition." Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with U.S. generally accepted accounting principles ("GAAP") have been condensed or omitted, although management believes that the disclosures herein are adequate to make the financial information presented not misleading. Our unaudited condensed consolidated financial statements have been prepared in conformity with U.S. GAAP applied on a consistent basis with those of the annual audited financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2020 (our "Annual Report on Form 10-K"), filed with the U.S. Securities and Exchange Commission (the "SEC") on March 1, 2021 and in accordance with the rules and regulations of the SEC. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto for the year ended December 31, 2020 included in our Annual Report on Form 10-K. All adjustments necessary for a fair presentation of the financial position and the results of operations for the interim periods presented have been included. All intercompany accounts and transactions have been eliminated. Such intercompany transactions do not include those with Delek Holdings or our general partner, which are presented as related parties in these accompanying condensed consolidated financial statements. All adjustments are of a normal, recurring nature. Operating results for the interim period should not be viewed as representative of results that may be expected for any future interim period or for the full year. Reclassifications Certain immaterial reclassifications have been made to prior period presentation in order to conform to the current period presentation. Risks and Uncertainties Arising from the COVID-19 Pandemic U.S. economic activity continued on a recovery trend during the quarter ended June 30, 2021, albeit remaining subject to heightened levels of uncertainty related to the on-going impact of the COVID-19 outbreak that developed into a pandemic in March 2020 (the “COVID-19 Pandemic” or the “Pandemic”), and the spread of new variants of the virus. Some of the restrictions imposed in the prior year to prevent its spread have been eased and the government vaccination campaigns continue to yield positive results in terms of increase in the number of people who have been inoculated, a critical requirement to continue removing restrictions. Compared to the prior year, the economic recovery trends in the three and six months ended June 30, 2021 included a resumption of flights by major airlines and increased motor vehicle use. This has in turn resulted in increased demand and market prices for crude oil and other products, particularly refined petroleum products from which we receive revenue for transporting and storing. We also saw an increase in demand and sales volumes in our wholesale marketing business during the three and six months ended June 30, 2021. Nonetheless, there remains continued uncertainty about the duration and future impact of the COVID-19 Pandemic. Our business model, which includes executing minimum volume commitment contracts with our major customers, to an extent, cushioned us from the impact of the COVID-19 Pandemic in 2020 and during the three and six months ended June 30, 2021. Uncertainties related to the impact of the COVID-19 Pandemic and other events exist that could impact our future results of operations and financial position, the nature of which and the extent to which are currently unknown. To the extent these uncertainties have been identified and are believed to have an impact on our current period results of operations or financial position based on the requirements for assessing such financial statement impact under GAAP, we have considered them in the preparation of our financial statements as of and for the three and six months ended June 30, 2021. New Accounting Pronouncements Adopted During 2021 ASU 2020-01, Investments—Equity Securities (Topic 321), Investments—Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815)—Clarifying the Interactions between Topic 321, Topic 323, and Topic 815 In January 2020, the Financial Accounting Standards Board (the "FASB") issued Accounting Standards Codification (" ASU") 2020-01 which is intended to clarify interactions between the guidance to account for certain equity securities under Topics 321, 323 and 815, and improve current GAAP by reducing diversity in practice and increasing comparability of accounting. The pronouncement is effective for fiscal years and interim periods within those fiscal years beginning after December 15, 2020, and early adoption is permitted. We adopted this guidance prospectively on January 1, 2021. The adoption of this guidance did not have a material impact on our business, financial condition or results of operations. Accounting Pronouncements Not Yet Adopted ASU 2020-04, Facilitation of the Effects of Reference Rate Reform on Financial Reporting (Topic 848) In March 2020, the FASB issued an amendment which is intended to provide temporary optional expedients and exceptions to GAAP guidance on contracts, hedge accounting and other transactions affected by the expected market transition from the London Interbank Offered Rate ("LIBOR") and other interbank rates. This guidance is effective for all entities any time beginning on March 12, 2020 through December 31, 2022 and may be applied from the beginning of an interim period that includes the issuance date of the ASU. The Partnership is evaluating the impact of this guidance but does not currently expect that adopting this new guidance will have a material impact on its condensed consolidated financial statements and related disclosures. |
Acquisitions
Acquisitions | 6 Months Ended |
Jun. 30, 2021 | |
Acquisitions [Abstract] | |
Acquisitions | Acquisitions Trucking Assets Acquisition Effective May 1, 2020, the Partnership, through its wholly-owned subsidiary DKL Transportation, LLC, acquired Delek Trucking, LLC consisting of certain leased and owned tractors and trailers and related assets from Delek Holdings. See our Annual Report on Form 10-K for further information. The total consideration is subject to certain post-closing adjustments and was approximately $48.0 million in cash. We financed this acquisition with a combination of cash on hand and borrowings under the DKL Credit Facility (as defined in Note 7). The Trucking Assets are recorded in our pipelines and transportation segment and include approximately 150 trucks and trailers, which are primarily leased or owned, respectively. In connection with the closing of the transaction, Delek Holdings, the Partnership and various of their respective subsidiaries entered into a Transportation Services Agreement (the “Trucking Assets TSA Agreement”). Under the Trucking Assets TSA Agreement, the Partnership will gather, coordinate pickup of, transport and deliver petroleum products for Delek Holdings, as well as provide ancillary services as requested. The transaction and related agreements were approved by the Conflicts Committee of the Partnership's general partner, which is comprised solely of independent directors. See Note 3 for more detailed descriptions of these agreements. The Trucking Assets Acquisition was considered a transaction between entities under common control. Accordingly, the Trucking Assets were recorded at amounts based on Delek Holdings' historical carrying value as of the acquisition date. The carrying value of the Trucking Assets as of the acquisition date was $13.3 million, consisting of $0.5 million of owned assets and a $12.8 million right of use asset for leased assets. The right of use asset offsets with an equivalent operating lease liability. Prior periods have not been recast as these assets do not constitute a business in accordance with Accounting Standard Update 2017-01, Clarifying the Definition of a Business ("ASU 2017-01"). We capitalized approximately $0.3 million of acquisition costs related to the Trucking Assets Acquisition. Big Spring Gathering Assets Acquisition Effective March 31, 2020, the Partnership, through its wholly-owned subsidiary DKL Permian Gathering, LLC, acquired the Big Spring Gathering Assets from Delek Holdings, located in Howard, Borden and Martin Counties, Texas. See our Annual Report on Form 10-K for further information. The total consideration was subject to certain post-closing adjustments and was comprised of $100.0 million in cash and 5.0 million common units representing limited partner interest in us. We financed the cash component of this acquisition with borrowings from the DKL Credit Facility (as defined in Note 7). The Big Spring Gathering Assets are recorded in our pipelines and transportation segment and include: • Crude oil pipelines; • Approximately 200 miles of gathering systems; • Approximately 65 Tank battery connections; • Terminals (total storage of approximately 650,000 bbls); and • Applicable rights-of-way. In connection with the closing of the transaction, Delek Holdings, the Partnership and various of their respective subsidiaries entered into a Throughput and Deficiency Agreement (the “Big Spring T&D Agreement”). Under the Big Spring T&D Agreement, the Partnership will operate and maintain the Big Spring Gathering Assets connecting Delek Holdings' interests in and to certain crude oil with the Partnership's Big Spring, Texas terminal and provide gathering, transportation and other related services with respect to any and all crude produced from shipper’s and certain other producers’ respective interests for delivery at the Big Spring Terminal. The transaction and related agreements were approved by the Conflicts Committee of the Partnership's general partner, which is comprised solely of independent directors. See Note 3 for more detailed descriptions of these agreements. The Big Spring Gathering Assets Acquisition was considered a transaction between entities under common control. Accordingly, the Big Spring Gathering Assets were recorded at amounts based on Delek Holdings' historical carrying value as of the acquisition date. The carrying value of the Big Spring Gathering Assets as of the acquisition date was $209.5 million. Pursuant to the common control guidance, the 5.0 million units issued (which had a closing market price of $9.10 per unit on the transaction date) were recorded in equity at $109.5 million, representing the net carrying value of the Big Spring Gathering Assets purchased of $209.5 million less the $100.0 million cash consideration. Prior periods have not been recast as these assets do not constitute a business in accordance with ASU 2017-01. We capitalized approximately $0.7 million of acquisition costs related to the Big Spring Gathering Assets Acquisition. |
Related Party Transactions
Related Party Transactions | 6 Months Ended |
Jun. 30, 2021 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Related Party Transactions Commercial Agreements The Partnership has a number of long-term, fee-based commercial agreements with Delek Holdings under which we provide various services, including crude oil gathering and crude oil, intermediate and refined products transportation and storage services, and marketing, terminalling and offloading services to Delek Holdings. Most of these agreements have an initial term ranging from five Under each of these agreements, we are required to maintain the capabilities of our pipelines and terminals, such that Delek Holdings may throughput and/or store, as the case may be, specified volumes of crude oil, intermediate and refined products. To the extent that Delek Holdings is prevented by our failure to maintain such capacities to throughput or from storing such specified volumes for more than 30 days per year, Delek Holdings' minimum throughput commitment will be reduced proportionately and prorated for the portion of the quarter during which the specified throughput capacity was unavailable, and/or the storage fee will be reduced, prorated for the portion of the month during which the specified storage capacity was unavailable. Such reduction would occur even if actual throughput or storage amounts were below the minimum volume commitment levels. See our Annual Report on Form 10-K for a more complete description of our material commercial agreements and other agreements with Delek Holdings. Other Agreements with Delek Holdings In addition to the commercial agreements described above, the Partnership has entered into the following agreements with Delek Holdings: Omnibus Agreement The Partnership entered into an omnibus agreement with Delek Holdings, Delek Logistics Operating, LLC, Lion Oil Company and certain of the Partnership's and Delek Holdings' other subsidiaries on November 7, 2012, which has been amended from time to time in connection with acquisitions from Delek Holdings (collectively, as amended, the "Omnibus Agreement"). The Omnibus Agreement governs the provision of certain operational services and reimbursement obligations, among other matters, between the Partnership and Delek Holdings, and obligates us to pay an annual fee of $4.7 million to Delek Holdings for its provision of centralized corporate services to the Partnership. Pursuant to the terms of the Omnibus Agreement, we are reimbursed by Delek Holdings for certain capital expenditures. There were no reimbursements by Delek Holdings during the three and six months ended June 30, 2021. During the three and six months ended June 30, 2020, we were reimbursed by Delek Holdings for certain capital expenditures of a nominal amount and $0.6 million, respectively. These amounts are recorded in other long-term liabilities and are amortized to revenue over the life of the underlying revenue agreement corresponding to the asset. Additionally, we are reimbursed or indemnified, as the case may be, for costs incurred in excess of certain amounts related to certain asset failures, pursuant to the terms of the Omnibus Agreeme nt. As of June 30, 2021, there was no receivable from related parties for these matters. These reimbursements are recorded as reductions to operating expense. We were reimbursed a nominal amount for these matters during the both three and six months ended June 30, 2021, and a nominal amount and $0.1 million during the three and six months ended June 30, 2020, respectively. Other Transactions The Partnership manages long-term capital projects on behalf of Delek Holdings pursuant to a construction management and operating agreement (the "DPG Management Agreement") for the construction of gathering systems in the Permian Basin. The majority of the gathering systems have been constructed, however, additional costs pertaining to a pipeline connection that was not acquired by the Partnership continue to be incurred and are still subject to the terms of the DPG Management Agreement. The Partnership is also considered the operator for the project and is responsible for oversight of the project design, procurement and construction of project segments and provides other related services. Pursuant to the terms of the DPG Management Agreement, the Partnership receives a monthly operating services fee and a construction services fee, which includes the Partnership's direct costs of managing the project plus an additional percentage fee of the construction costs of each project segment. The agreement extends through December 2022. Total fees paid to the Partnership were $0.4 million and $0.8 million for the three and six months ended June 30, 2021, respectively, and $0.4 million and $1.2 million for the three and six months ended June 30, 2020, respectively, which are recorded in affiliate revenue in our condensed consolidated statements of income. Additionally, the Partnership incurs the costs in connection with the construction of the assets and is subsequently reimbursed by Delek Holdings. Amounts reimbursable by Delek Holdings are recorded in accounts receivable from related parties. Unregistered Sale of Equity Securities In connection with the Partnership's issuance of the common limited partner units under the Big Spring Gathering Assets Acquisition and in accordance with the Partnership's First Amended and Restated Agreement of Limited Partnership, as amended (the "Prior Partnership Agreement", as amended and restated by the Partnership's Second Amended and Restated Agreement of Limited Partnership (the "Partnership Agreement")), the Partnership issued general partner units to the general partner in an amount necessary to maintain its 2% general partner interest as defined in the Prior Partnership Agreement. The sale and issuance of the Additional Units (as defined below) and such general partner units in connection with the Big Spring Gathering Assets Acquisition is exempt from registration under Section 4(a)(2) of the Securities Act of 1933, as amended. Additionally, in March 2020, Delek Marketing & Supply, LLC ("Delek Marketing"), a wholly owned subsidiary of Delek Holdings, repurchased 451,822 common limited partner units from an unaffiliated investor pursuant to a Common Unit Purchase Agreement between Delek Marketing and such investor. The purchase price of the units amounted to approximately $5.0 million. As a result of the transaction, Delek Holdings' ownership in our outstanding limited partner units increased to 64.5% from 62.6%. Delek Holdings' ownership in our common limited partner units was further increased to 70.5% as a result of the issuance of 5.0 million common limited partner units (the “Additional Units”) in connection with the Big Spring Gathering Assets Acquisition described above. In August 2020, Delek Holdings' ownership in our common limited partner units was further increased to approximately 80.0% in connection with the IDR Restructuring Transaction, where the Partnership issued 14.0 million of the Partnership's newly issued common limited partner units to Delek Holdings. Amendment No. 2 to the First Amended and Restated Agreement of Limited Partnership of Delek Logistics Partners, LP On March 31, 2020, in connection with the completion of the Big Spring Gathering Assets Acquisition, the Board of the general partner adopted Amendment No. 2 (“Amendment No. 2”) to the Prior Partnership Agreement, effective upon adoption. Amendment No. 2 amended the Prior Partnership Agreement to provide for a waiver of distributions in respect of the IDRs for General Partner Additional Units ("GP Additional Units") associated with the 5.0 million Additional Units for at least two years, through at least the distribution for the quarter ending March 31, 2022 ( the “IDR Waiver”). The IDR Waiver essentially reduced the distribution made to the holders of the IDRs during this period, as the holders would not receive a share of the distribution made on the GP Additional Units. The IDRs were eliminated in the IDR Restructuring Transaction on August 13, 2020. Conversion of GP Economic Interest and Elimination of IDRs On August 13, 2020, we closed the transaction contemplated by a definitive exchange agreement with Delek Holdings to eliminate all of the IDRs held by the general partner and convert the 2% general partner economic interest into a non-economic general partner interest, all in exchange for 14.0 million of the Partnership's newly issued common limited partner units and $45.0 million cash. Contemporaneously, Delek Holdings purchased a 5.2% ownership interest in our general partner from certain affiliates who were also members of our general partner's management and board of directors. Delek Holdings now owns a 100% interest in the general partner and owns approximately 34.7 million common limited partner units, representing approximately 80% of the Partnership's outstanding common limited partner units. To implement the transaction, our Prior Partnership Agreement was amended and restated. Summary of Transactions Revenues from affiliates consist primarily of revenues from gathering, transportation, storage, offloading, Renewable Identification Numbers ("RINs"), wholesale marketing and products terminalling services provided primarily to Delek Holdings based on regulated tariff rates or contractually based fees and product sales. Affiliate operating expenses are primarily comprised of amounts we reimburse Delek Holdings, or our general partner, as the case may be, for the services provided to us under the Partnership Agreement. These expenses could also include reimbursement and indemnification amounts from Delek Holdings, as provided under the Omnibus Agreement. Additionally, the Partnership is required to reimburse Delek Holdings for direct or allocated costs and expenses incurred by Delek Holdings on behalf of the Partnership and for charges Delek Holdings incurred for the management and operation of our logistics assets, including an annual fee for various centralized corporate services, which are included in general and administrative expenses. In addition to these transactions, we purchase refined products and bulk biofuels from Delek Holdings, the costs of which are included in cost of materials and other. A summary of revenue, purchases from affiliates and expense transactions with Delek Holdings and its affiliates are as follows (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2021 2020 2021 2020 Revenues $ 88,722 $ 87,629 $ 184,916 $ 194,328 Purchases from Affiliates $ 74,128 $ 29,730 $ 139,943 $ 110,493 Operating and maintenance expenses $ 9,477 $ 10,310 $ 19,561 $ 23,067 General and administrative expenses $ 1,994 $ 2,703 $ 4,113 $ 6,072 Quarterly Cash Distributions Prior to August 13, 2020, our common and general partner unitholders and the holders of IDRs were entitled to receive quarterly distributions of available cash as determined by the board of directors of our general partner in accordance with the terms and provisions of our Prior Partnership Agreement. Pursuant to the IDR Restructuring Transaction on August 13, 2020, the general partner will no longer receive any cash distributions. In February and May 2021, we paid quarterly cash distributions of $39.5 million and $40.0 million, of which $31.6 million and $32.0 million, respectively, were paid to Delek Holdings. In February and May 2020, we paid quarterly cash distributions of $30.6 million and $30.9 million, respectively, of which $22.6 million and $23.2 million, respectively, were paid to Delek Holdings and our general partner. On July 26, 2021, our board of directors declared a quarterly cash distribution totaling $40.8 million, based on the available cash as of the date of determination, for the end of the second quarter of 2021, payable on August 11, 2021, of which $32.7 million is expected to be paid to Delek Holdings. |
Revenues (Notes)
Revenues (Notes) | 6 Months Ended |
Jun. 30, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Revenues | Revenues We generate revenue by charging fees for gathering, transporting, offloading and storing crude oil; for storing intermediate products and feed stocks; for distributing, transporting and storing refined products; for marketing refined products output of Delek Holdings' Tyler and Big Spring refineries; and for wholesale marketing in the West Texas area. A significant portion of our revenue is derived from long-term commercial agreements with Delek Holdings, which provide for annual fee adjustments for increases or decreases in the CPI, PPI or the FERC index (refer to Note 3 for a more detailed description of these agreements). In addition to the services we provide to Delek Holdings, we also generate substantial revenue from crude oil, intermediate and refined products transportation services for, and terminalling and marketing services to, third parties primarily in Texas, New Mexico, Tennessee and Arkansas. Certain of these services are provided pursuant to contractual agreements with third parties. Payment terms require customers to pay shortly after delivery and do not contain significant financing components. The majority of our commercial agreements with Delek Holdings meet the definition of a lease because: (1) performance of the contracts is dependent on specified property, plant or equipment and (2) it is remote that one or more parties other than Delek Holdings will take more than a minor amount of the output associated with the specified property, plant or equipment. As part of our adoption of ASC 842, Leases ("ASC 842"), we applied the permitted practical expedient to not separate lease and non-lease components under the predominance principle to designated asset classes associated with the provision of logistics services. We have determined that the predominant component of the related agreements currently in effect is the lease component. Therefore, the combined component is accounted for under the applicable lease accounting guidance. Of our $454.8 million net property, plant, and equipment balance as of June 30, 2021, $383.0 million is subject to operating leases under our commercial agreements. These agreements do not include options for the lessee to purchase our leasing equipment, nor do they include any material residual value guarantees or material restrictive covenants. The following table represents a disaggregation of revenue for each reportable segment for the periods indicated (in thousands): Three Months Ended June 30, 2021 Pipelines and Transportation Wholesale Marketing and Terminalling Consolidated Service Revenue - Third Party $ 4,771 $ 137 $ 4,908 Service Revenue - Affiliate 3,797 8,554 12,351 Product Revenue - Third Party — 74,849 74,849 Product Revenue - Affiliate — 3,741 3,741 Lease Revenue - Affiliate (1) 61,867 10,762 72,629 Total Revenue $ 70,435 $ 98,043 $ 168,478 (1) Net of $1.8 million of amortization expense for the three months ended June 30, 2021, related to a customer contract intangible asset recorded in the wholesale marketing and terminalling segment. Six Months Ended June 30, 2021 Pipelines and Transportation Wholesale Marketing and Terminalling Consolidated Service Revenue - Third Party $ 6,698 $ 219 $ 6,917 Service Revenue - Affiliate 5,021 16,636 21,657 Product Revenue - Third Party — 129,559 129,559 Product Revenue - Affiliate — 20,128 20,128 Lease Revenue - Affiliate (1) 123,691 19,439 143,130 Total Revenue $ 135,410 $ 185,981 $ 321,391 (1) Net of $3.6 million of amortization expense for the six months ended June 30, 2021, related to a customer contract intangible asset recorded in the wholesale marketing and terminalling segment. Three Months Ended June 30, 2020 Pipelines and Transportation Wholesale Marketing and Terminalling Consolidated Service Revenue - Third Party $ 2,032 $ 204 $ 2,236 Service Revenue - Affiliate 3,326 7,810 11,136 Product Revenue - Third Party — 27,772 27,772 Product Revenue - Affiliate — 6,720 6,720 Lease Revenue - Affiliate (1) 58,068 11,705 69,773 Total Revenue $ 63,426 $ 54,211 $ 117,637 (1) Net of $1.8 million of amortization expense for the three months ended June 30, 2020, related to a customer contract intangible asset recorded in the wholesale marketing and terminalling segment. Six Months Ended June 30, 2020 Pipelines and Transportation Wholesale Marketing and Terminalling Consolidated Service Revenue - Third Party $ 11,496 $ 396 $ 11,892 Service Revenue - Affiliate 8,215 15,792 24,007 Product Revenue - Third Party — 74,818 74,818 Product Revenue - Affiliate — 58,222 58,222 Lease Revenue - Affiliate (1) 91,682 20,417 112,099 Total Revenue $ 111,393 $ 169,645 $ 281,038 (1) Net of $3.6 million of amortization expense for the six months ended June 30, 2020, related to a customer contract intangible asset recorded in the wholesale marketing and terminalling segment. As of June 30, 2021, we expect to recognize $1.4 billion in lease revenues related to our unfulfilled performance obligations pertaining to the minimum volume commitments and capacity utilization under the non-cancelable terms of our commercial agreements with Delek Holdings. Most of these agreements have an initial term ranging from five Our unfulfilled performance obligations as of June 30, 2021 were as follows (in thousands): Remainder of 2021 136,671 2022 253,482 2023 245,737 2024 169,475 2025 and thereafter $ 626,042 Total expected revenue on remaining performance obligations $ 1,431,407 |
Net Income Per Unit
Net Income Per Unit | 6 Months Ended |
Jun. 30, 2021 | |
Earnings Per Share [Abstract] | |
Net Income Per Unit | Net Income Per Unit Basic net income per unit applicable to limited partners is computed by dividing limited partners' interest in net income by the weighted-average number of outstanding common units. Prior to August 13, 2020, we had more than one class of participating securities and used the two class method to calculate the net income per unit applicable to the limited partners. The classes of participating units prior to August 13, 2020 consisted of limited partner units, general partner units and IDRs. Pursuant to the IDR Restructuring Transaction, the IDRs were eliminated and the 2% general partner economic interest was converted to a non-economic general partner interest. Effective August 13, 2020, the common limited partner units are the only participating security for cash distributions. Refer to Note 3 for additional details. The two-class method was based on the weighted-average number of common units outstanding during the period. Basic net income per unit applicable to limited partners was computed by dividing limited partners’ interest in net income, after deducting our general partner’s 2% interest and IDRs, by the weighted-average number of outstanding common units. Our net income was allocated to our general partner and limited partners in accordance with their respective partnership percentages after giving effect to priority income allocations for IDRs, which were held by our general partner pursuant to our Prior Partnership Agreement. Earnings in excess of distributions were allocated to our general partner and limited partners based on their respective ownership interests. The IDRs were paid following the close of each quarter. Pursuant to Amendment No. 2 to the Prior Partnership Agreement, an agreement was reached for a waiver of distributions in respect of the IDRs for the GP Additional Units associated with the 5.0 million Additional Units issued in connection with the Big Spring Gathering Assets Acquisition for at least two years, through at least the distribution for the quarter ending March 31, 2022. Refer to Note 3 for additional details. Diluted net income per unit applicable to common limited partners includes the effects of potentially dilutive units on our common units. As of June 30, 2021, the only potentially dilutive units outstanding consist of unvested phantom units. Our distributions earned with respect to a given period are declared subsequent to quarter end. Therefore, the table below represents total cash distributions applicable to the period in which the distributions are earned. The expected date of distribution for the distributions earned during the period ended June 30, 2021 is August 11, 2021. Payments made to our unitholders are determined in relation to actual distributions declared and are not based on the net income allocations used in the calculation of net income per unit. The calculation of net income per unit is as follows (dollars in thousands, except units and per unit amounts): Three Months Ended June 30, Six Months Ended June 30, 2021 2020 2021 2020 Net income attributable to partners $ 43,246 $ 44,415 $ 79,513 $ 72,211 Less: General partner's distribution (including IDRs) (1) — 9,479 — 18,618 Less: Limited partners' distribution 40,846 26,490 80,814 48,229 Earnings in excess (deficit) of distributions $ 2,400 $ 8,446 $ (1,301) $ 5,364 General partner's earnings: Distributions (including IDRs) (1) $ — $ 9,479 $ — $ 18,618 Allocation of earnings in excess (deficit) of distributions — 168 — 106 Total general partner's earnings $ — $ 9,647 $ — $ 18,724 Limited partners' earnings on common units: Distributions $ 40,846 $ 26,490 $ 80,814 $ 48,229 Allocation of earnings in excess (deficit) of distributions 2,400 8,278 (1,301) 5,258 Total limited partners' earnings on common units $ 43,246 $ 34,768 $ 79,513 $ 53,487 Weighted average limited partner units outstanding: Common units - basic 43,445,222 29,427,298 43,444,284 26,953,934 Common units - diluted 43,460,366 29,430,555 43,453,806 26,956,523 Net income per limited partner unit: Common units - basic $ 1.00 $ 1.18 $ 1.83 $ 1.98 Common units - diluted (2) $ 1.00 $ 1.18 $ 1.83 $ 1.98 (1) Prior to August 13, 2020, general partner distributions (including IDRs) consisted of the 2.0% general partner interest and IDRs, which represented the right of the general partner to receive increasing percentages of quarterly distributions of available cash from operating surplus in excess of 0.43125 per unit per quarter. In connection with the IDR Restructuring Transaction on August 13, 2020, the IDRs were eliminated and the general partner interest became a non-economic general partner interest. (2) Outstanding common units totaling 3,662 and 1,841 were excluded from the diluted earnings per unit calculation for the three and six months ended June 30, 2021, respectively. Outstanding common units totaling 18,270 were excluded from the diluted earnings per unit calculation for both the three and six months ended June 30, 2020. |
Inventory
Inventory | 6 Months Ended |
Jun. 30, 2021 | |
Inventory Disclosure [Abstract] | |
Inventory | InventoryInventories consisted of $2.0 million and $3.1 million of refined petroleum products as of June 30, 2021 and December 31, 2020, each of which are net of lower of cost or net realizable value reserve of a nominal amount. Inventory is stated at the lower of cost or net realizable value, with cost determined on a first-in, first-out basis. We recognize lower of cost or net realizable value charges as a component of cost of materials and other in the consolidated statements of income and comprehensive income. |
Long-Term Obligations
Long-Term Obligations | 6 Months Ended |
Jun. 30, 2021 | |
Debt Disclosure [Abstract] | |
Long-Term Obligations | Long-Term Obligations 7.125% Senior Notes due 2028 On May 24, 2021, the Partnership and our wholly owned subsidiary Delek Logistics Finance Corp. ("Finance Corp." and together with the Partnership, the "Issuers") sold $400.0 million in aggregate principal amount of 7.125% senior notes due 2028 (the "2028 Notes") at par, pursuant to an indenture with U.S. Bank, National Association as trustee. The 2028 Notes are general unsecured senior obligations of the Issuers and are unconditionally guaranteed jointly and severally on a senior unsecured basis by the Partnership's subsidiaries other than Finance Corp., and will be unconditionally guaranteed on the same basis by certain of the Partnership’s future subsidiaries. The 2028 Notes rank equal in right of payment with all existing and future senior indebtedness of the Issuers, and senior in right payment to any future subordinated indebtedness of the Issuers. The 2028 Notes will mature on June 1, 2028, and interest on the 2028 Notes is payable semi-annually in arrears on each June 1 and December 1, commencing December 1, 2021. At any time prior to June 1, 2024, the Issuers may redeem up to 35% of the aggregate principal amount of the 2028 Notes with the net cash proceeds of one or more equity offerings by the Partnership at a redemption price of 107.125% of the redeemed principal amount, plus accrued and unpaid interest, if any, subject to certain conditions and limitations. Prior to June 1, 2024, the Issuers may also redeem all or part of the 2028 Notes at a redemption price of the principal amount plus accrued and unpaid interest, if any, plus a "make whole" premium, subject to certain conditions and limitations. In addition, beginning on June 1, 2024, the Issuers may, subject to certain conditions and limitations, redeem all or part of the 2028 Notes, at a redemption price of 103.563% of the redeemed principal for the twelve-month period beginning on June 1, 2024, 101.781% for the twelve-month period beginning on June 1, 2025, and 100.00% beginning on June 1, 2026 and thereafter, plus accrued and unpaid interest, if any. In the event of a change of control, accompanied or followed by a ratings downgrade within a certain period of time, subject to certain conditions and limitations, the Issuers will be obligated to make an offer for the purchase of the 2028 Notes from holders at a price equal to 101% of the principal amount thereof, plus accrued and unpaid interest. As of June 30, 2021, we had $400.0 million in outstanding principal amount under the 2028 Notes, and the effective interest rate was 7.41%. Outstanding borrowings under the 2028 Notes are net of deferred financing costs amounting to $6.3 million as of June 30, 2021. DKL Credit Facility On September 28, 2018, the Partnership entered into a third amended and restated senior secured revolving credit agreement (hereafter, the "DKL Credit Facility") with Fifth Third Bank ("Fifth Third"), as administrative agent, and a syndicate of lenders with total lender commitments of $850.0 million. The DKL Credit Facility contains a dual currency borrowing tranche that permits draw downs in U.S. or Canadian dollars. The DKL Credit Facility also contains an accordion feature whereby the Partnership can increase the size of the credit facility to an aggregate of $1.0 billion, subject to receiving increased or new commitments from lenders and the satisfaction of certain other conditions precedent. The obligations under the DKL Credit Facility remain secured by first priority liens on substantially all of the Partnership's and its subsidiaries' tangible and intangible assets. In connection with the IDR Restructuring Transaction, the Partnership entered into a First Amendment to the DKL Credit Facility (the "First Amendment") which, among other things, permitted the exchange of the IDRs and the general partner interest in the Partnership for the non-economic general partner interest, the newly issued limited partner interests in the Partnership, plus $45.0 million in cash. The First Amendment also modified the total leverage and senior leverage ratios (as defined in the DKL Credit Facility) calculations to reduce the total funded debt (as defined in the DKL Credit Facility) component thereof by the total amount of unrestricted consolidated cash and cash equivalents on the balance sheet of the Partnership and its subsidiaries up to $20.0 million. The DKL Credit Facility has a maturity date of September 28, 2023. Borrowings denominated in U.S. dollars bear interest at either a U.S. dollar prime rate, plus an applicable margin, or the LIBOR, plus an applicable margin, at the election of the borrowers. Borrowings denominated in Canadian dollars bear interest at either a Canadian dollar prime rate, plus an applicable margin, or the Canadian Dealer Offered Rate, plus an applicable margin, at the election of the borrowers. The applicable margin in each case and the fee payable for any unused revolving commitments vary based upon the Partnership's most recent total leverage ratio calculation delivered to the lenders, as called for and defined under the terms of the DKL Credit Facility. At June 30, 2021, the weighted average interest rate for our borrowings under the facility was approximately 2.50%. Additionally, the DKL Credit Facility requires us to pay a leverage ratio dependent quarterly fee on the average unused revolving commitment. As of June 30, 2021, this fee was 0.35% per year. As of June 30, 2021, we had $288.8 million of outstanding borrowings under the DKL Credit Facility, with no letters of credit in place. Unused credit commitments under the DKL Credit Facility as of June 30, 2021 were $561.2 million. 6.750% Senior Notes Due 2025 On May 23, 2017, the Partnership and Delek Logistics Finance Corp., a Delaware corporation and a wholly-owned subsidiary of the Partnership (“Finance Corp.” and together with the Partnership, the “Issuers”), issued $250.0 million in aggregate principal amount of 6.75% senior notes due 2025 (the “2025 Notes”) at a discount. The 2025 Notes are general unsecured senior obligations of the Issuers. The 2025 Notes are unconditionally guaranteed jointly and severally on a senior unsecured basis by the Partnership's existing subsidiaries (other than Finance Corp., the "Guarantors") and will be unconditionally guaranteed on the same basis by certain of the Partnership’s future subsidiaries. The 2025 Notes rank equal in right of payme nt with all existing and future senior indebtedness of the Issuers, and senior in right of payment to any future subordinated indebtedness of the Issuers. Interest on the 2025 Notes is payable semi-annually in arrears on each May 15 and November 15. Th e Issuers may, subject to certain conditions and limitations, redeem all or part of the 2025 Notes at a redemption price of 103.375% of the redeemed principal during the twelve-month period beginning on May 15, 2021, 101.688% for the twelve-month period beginning on May 15, 2022 and 100.00% beginning on May 15, 2023 and thereafter, plus accrued and unpaid interest, if any. In the event of a change of control, accompanied or followed by a ratings downgrade within a certain period of time, subject to certain conditions and limitations, the Issuers will be obligated to make an offer for the purchase of the 2025 Notes from holders at a price equal to 101% of the principal amount thereof, plus accrued and unpaid interest. On April 25, 2018, we made an offer to exchange the 2025 Notes and the related guarantees that were validly tendered and not validly withdrawn for an equal principal amount of exchange notes that are freely tradeable, as required under the terms of the original indenture. The terms of the exchange notes that were issued in May 2018 as a result of the exchange (also referred to as the "2025 Notes") are substantially identical to the terms of the original 2025 Notes. |
Equity
Equity | 6 Months Ended |
Jun. 30, 2021 | |
Equity [Abstract] | |
Equity | Equity We had 8,707,565 common limited partner units held by the public outstanding as of June 30, 2021. Additionally, as of June 30, 2021, Delek Holdings owned an 80.0% limited partner interest in us, consisting of 34,745,868 common limited partner units. Effective August 13, 2020, the Partnership closed on the IDR Restructuring Transaction. As part of this transaction, we expensed approximately $1.1 million of transaction costs. Refer to Note 3 for additional details. In August 2020, we filed a shelf registration statement with the SEC, which subsequently became effective, for the proposed re-sale or other disposition from time to time by Delek Holdings of up to 14.0 million of our common limited partner units. As of June 30, 2021, we had not sold any securities under this shelf registration statement and we will not receive any proceeds from the sale of securities by Delek Holdings. Equity Activity The table below summarizes the changes in the number of limited partner units outstanding from December 31, 2020 through June 30, 2021. Common - Public Common - Delek Holdings Total Balance at December 31, 2020 8,697,468 34,745,868 43,443,336 Unit-based compensation awards (1) 10,097 — 10,097 Balance at June 30, 2021 8,707,565 34,745,868 43,453,433 (1) Unit-based compensation awards are presented net of 445 units withheld for taxes as of June 30, 2021. Issuance of Additional Securities Our Partnership Agreement authorizes us to issue an unlimited number of additional partnership securities for the consideration and on the terms and conditions determined by our general partner without the approval of the unitholders. Costs associated with the issuance of securities are allocated to all unitholders' capital accounts based on their ownership interest at the time of issuance. Allocations of Net Income Our Partnership Agreement contains provisions for the allocation of net income and loss to the unitholders. For purposes of maintaining partner capital accounts, the Partnership Agreement specifies that items of income and loss shall be allocated among the partners in accordance with their respective percentage interest. Prior to August 13, 2020, normal allocations were made according to percentage interests after giving effect to priority income allocations in an amount equal to incentive cash distributions allocated 100% to our general partner. Effective August 13, 2020, the IDRs were eliminated and the 2% general partner economic interest was converted to a non-economic general partner interest that no longer receives cash distributions. Refer to Note 3 for additional details. The following table presents the allocation of the general partner's interest in net income (in thousands, except percentage of ownership interest): Three Months Ended June 30, Six Months Ended June 30, 2021 2020 2021 2020 Net income attributable to partners $ 43,246 $ 44,415 $ 79,513 $ 72,211 Less: General partner's IDRs — (8,937) — (17,632) Net income available to partners $ 43,246 $ 35,478 $ 79,513 $ 54,579 General partner's ownership interest — % 2.0 % — % 2.0 % General partner's allocated interest in net income $ — $ 710 — $ 1,092 General partner's IDRs — 8,937 — 17,632 Total general partner's interest in net income $ — $ 9,647 $ — $ 18,724 Incentive Distribution Rights ("IDRs") Effective August 13, 2020, the Partnership closed on the IDR Restructuring Transaction and the general partner no longer receives any cash distributions. Prior to August 13, 2020, our general partner was entitled to 2.0% of all quarterly distributions. Our general partner had the right, but not the obligation, to contribute up to a proportionate amount of capital to us to maintain its current general partner interest. Our general partner held IDRs that entitled it to receive increasing percentages, up to a maximum of 48.0%, of the cash we distributed from operating surplus (as defined in our Prior Partnership Agreement) in excess of $0.43125 per unit per quarter. The maximum distribution was 48.0% and did not include any distributions that our general partner or its affiliates may have received on common or general partner units that it owns. As of August 12, 2020, the IDRs held by our general partner were entitled to receive the maximum distribution. Pursuant to Amendment No. 2 to the Prior Partnership Agreement, prior to the IDR Restructuring Transaction, an agreement was reached for a waiver of distributions in respect of the IDRs associated with the 5.0 million Additional Units for at least two years, through at least the distribution for the quarter ending March 31, 2022 (the "IDR Waiver"). Refer to Note 3 for additional details. Cash Distributions Our Partnership Agreement sets forth the calculation to be used to determine the amount and priority of available cash distributions that our limited partner unitholders will receive. The cash distributions for periods before August 13, 2020 include distributions to the 2% general partner interest which was converted to a non-economic general partner interest and IDRs which were permanently eliminated. Our distributions earned with respect to a given period are declared subsequent to quarter end. The table below summarizes the quarterly distributions related to our quarterly financial results: Quarter Ended Total Quarterly Distribution Per Limited Partner Unit Total Cash Distribution Date of Distribution Unitholders Record Date June 30, 2020 $ 0.900 $ 35,969 August 12, 2020 August 7, 2020 September 30, 2020 $ 0.905 $ 39,308 November 12, 2020 November 6, 2020 December 31, 2020 $ 0.910 $ 39,533 February 9, 2021 February 2, 2021 March 31, 2021 $ 0.920 $ 39,968 May 14, 2021 May 10, 2021 June 30, 2021 $ 0.940 $ 40,846 August 11, 2021 (1) August 5, 2021 (1) Expected date of distribution. The allocations of total quarterly cash distributions made to limited partners for the three and six months ended June 30, 2021 and 2020 are set forth in the table below. Distributions earned with respect to a given period are declared subsequent to quarter end. Therefore, the table below presents total cash distributions applicable to the period in which the distributions are earned (in thousands, except per unit amounts): Three Months Ended June 30, Six Months Ended June 30, 2021 2020 2021 2020 General partner's distributions: General partner's distributions $ — $ 542 $ — $ 986 General partner's IDRs — 8,937 — 17,632 Total general partner's distributions — 9,479 — 18,618 Limited partners' distributions: Common limited partners' distributions 40,846 26,490 80,814 48,229 Total cash distributions $ 40,846 $ 35,969 $ 80,814 $ 66,847 Cash distributions per limited partner unit $ 0.940 $ 0.900 $ 1.860 $ 1.790 |
Equity Based Compensation
Equity Based Compensation | 6 Months Ended |
Jun. 30, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Equity Based Compensation | Equity Based CompensationThe Delek Logistics GP, LLC 2012 Long-Term Incentive Plan (the "LTIP") was adopted by the Delek Logistics GP, LLC board of directors in connection with the completion of our initial public offering in November 2012. The LTIP is administered by the Conflicts Committee of the board of directors. Equity-based compensation expense is included in general and administrative expenses in the accompanying condensed consolidated statements of income and comprehensive income and is immaterial for the three and six months ended June 30, 2021 and 2020. On June 9, 2021, the LTIP was amended to increase the number of units representing limited partner interest in the Partnership (the "Common Units") authorized for issuance by 300,000 Units to 912,207 Common Units. Additionally, the term of the LTIP was extended to June 9, 2031. |
Equity Method Investments
Equity Method Investments | 6 Months Ended |
Jun. 30, 2021 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Equity Method Investments | Equity Method Investments In May 2019, the Partnership, through its wholly owned indirect subsidiary DKL Pipeline, LLC (“DKL Pipeline”), entered into a Contribution and Subscription Agreement (the “Contribution Agreement”) with Plains Pipeline, L.P. (“Plains”) and Red River Pipeline Company LLC (“Red River”). Pursuant to the Contribution Agreement, DKL Pipeline contributed $124.7 million, substantially all of which was financed by borrowings under the DKL Credit Facility, to Red River in exchange for a 33% membership interest in Red River and DKL Pipeline’s admission as a member of Red River. In addition, we contributed $0.4 million of startup capital pursuant to the Amended and Restated Limited Liability Company Agreement. During the third quarter of 2020, Red River, which owns a crude oil pipeline running from Cushing, Oklahoma to Longview, Texas, completed a planned expansion project to increase the pipeline capacity and commenced operations on the completed expansion project on October 1, 2020. We contributed $3.5 million related to such expansion project in May 2019 and during 2020 made additional capital contributions of $12.2 million based on capital calls received. During the six months ended June 30, 2021, we made additional capital contributions totaling $1.4 million based on capital calls received. Summarized unaudited financial information for Red River on a 100% basis is shown below (in thousands): June 30, 2021 December 31, 2020 Current Assets $ 21,877 $ 13,488 Non-current Assets $ 408,375 $ 413,259 Current liabilities $ 11,211 $ 7,789 Three Months Ended June 30, Six Months Ended June 30, 2021 2020 2021 2020 Revenues $ 17,744 $ 11,873 $ 26,787 $ 21,969 Gross profit $ 10,715 $ 7,175 $ 14,340 $ 13,062 Operating income $ 10,556 $ 7,000 $ 13,995 $ 12,697 Net income $ 10,551 $ 7,025 $ 13,990 $ 12,746 We have two joint ventures that have constructed separate crude oil pipeline systems and related ancillary assets, which are serving third parties and subsidiaries of Delek Holdings. We own a 50% membership interest in the entity formed with an affiliate of Plains All American Pipeline, L.P. ("CP LLC") to operate one of these pipeline systems (the "Caddo Pipeline") and a 33% membership interest in the entity formed with Rangeland Energy II, LLC ("Rangeland Energy") to operate the other pipeline system (the "Rio Pipeline"). During 2018, Rangeland Energy was acquired by Andeavor and the legal entity in which we have an equity investment became Andeavor Logistics Rio Pipeline LLC ("Andeavor Logistics"). Combined summarized unaudited financial information for these two equity method investees on a 100% basis is shown below (in thousands): June 30, 2021 December 31, 2020 Current assets $ 20,551 $ 20,763 Non-current assets $ 248,340 $ 253,862 Current liabilities $ 2,825 $ 1,496 Three Months Ended June 30, Six Months Ended June 30, 2021 2020 2021 2020 Revenues $ 13,600 $ 12,738 $ 23,226 $ 28,185 Gross profit $ 8,739 $ 8,198 $ 13,705 $ 18,834 Operating income $ 8,244 $ 7,724 $ 12,722 $ 17,864 Net Income $ 8,544 $ 7,729 $ 12,723 $ 17,887 The Partnership's investments in these three entities were financed through a combination of cash from operations and borrowings under the DKL Credit Facility. As of June 30, 2021 and December 31, 2020, the Partnership's investment balance in these joint ventures was $252.0 million and $253.7 million, respectively. We do not consolidate any part of the assets or liabilities or operating results of our equity method investees. Our share of net income or loss of the investees will increase or decrease, as applicable, the carrying value of our investments in unconsolidated affiliates. With respect to our equity method investments, we determined that these entities do not represent variable interest entities and consolidation is not required. We have the ability to exercise significant influence over each of these joint ventures through our participation in the management committees, which make all significant decisions. However, since all significant decisions require the consent of the other investor(s) without regard to economic interest, we have determined that we have joint control and have applied the equity method of accounting. Our investment in these joint ventures is reflected in our pipelines and transportation segment. |
Segment Data
Segment Data | 6 Months Ended |
Jun. 30, 2021 | |
Segment Reporting [Abstract] | |
Segment Data | Segment Data We aggregate our operating segments into two reportable segments: (i) pipelines and transportation and (ii) wholesale marketing and terminalling: • The assets and investments reported in the pipeline and transportation segment provide crude oil gathering and crude oil, intermediate and refined products transportation and storage services to Delek Holdings' refining operations and independent third parties. • The wholesale marketing and terminalling segment provides marketing services for the refined products output of the Delek Holdings' refineries, engages in wholesale activity at our terminals and terminals owned by third parties, whereby we purchase light product for sale and exchange to third parties, and provides terminalling services at our refined products terminals to independent third parties and Delek Holdings. Our operating segments adhere to the accounting policies used for our consolidated financial statements. Our operating segments are managed separately because each segment requires different industry knowledge, technology and marketing strategies. Decisions concerning the allocation of resources and assessment of operating performance are made based on this segmentation. Management measures the operating performance of each of its reportable segments based on segment contribution margin. Segment contribution margin is defined as net revenues less cost of materials and other and operating expenses, excluding depreciation and amortization. The following is a summary of business segment operating performance as measured by contribution margin for the periods indicated: (in thousands) Three Months Ended June 30, Six Months Ended June 30, 2021 2020 2021 2020 Pipelines and Transportation Net revenues: Affiliate $ 65,664 $ 61,394 $ 128,712 $ 99,897 Third party 4,771 2,032 6,698 11,496 Total pipelines and transportation 70,435 63,426 135,410 111,393 Cost of materials and other 14,346 11,182 27,425 17,280 Operating expenses (excluding depreciation and amortization) 10,858 9,731 21,030 21,187 Segment contribution margin $ 45,231 $ 42,513 $ 86,955 $ 72,926 Capital spending $ 1,531 $ 417 $ 7,376 $ 863 Wholesale Marketing and Terminalling Net revenues: Affiliate (1) $ 23,058 $ 26,235 $ 56,204 $ 94,431 Third party 74,985 27,976 129,777 75,214 Total wholesale marketing and terminalling 98,043 54,211 185,981 169,645 Cost of materials and other 74,349 32,710 142,441 127,905 Operating expenses (excluding depreciation and amortization) 4,623 2,718 8,507 6,006 Segment contribution margin $ 19,071 $ 18,783 $ 35,033 $ 35,734 Capital spending $ 1,060 $ 235 $ 3,014 $ 2,818 Consolidated Net revenues: Affiliate $ 88,722 $ 87,629 $ 184,916 $ 194,328 Third party 79,756 30,008 136,475 86,710 Total Consolidated 168,478 117,637 321,391 281,038 Cost of materials and other 88,695 43,892 169,866 145,185 Operating expenses (excluding depreciation and amortization presented below) 15,481 12,449 29,537 27,193 Contribution margin $ 64,302 $ 61,296 121,988 108,660 General and administrative expenses 6,077 4,721 10,937 10,851 Depreciation and amortization 9,967 8,694 20,706 14,993 Other operating income, net (136) — (219) (107) Operating income $ 48,394 $ 47,881 $ 90,564 $ 82,923 Capital spending $ 2,591 $ 652 $ 10,390 $ 3,681 (1) Affiliate revenue for the wholesale marketing and terminalling segment is presented net of amortization expense related to a customer contract intangible asset. See Note 4 for additional information. The following table summarizes the total assets for each segment as of June 30, 2021 and December 31, 2020 (in thousands). Assets for each segment include property, plant and equipment, equity method investments, intangible assets and inventory. June 30, 2021 December 31, 2020 Pipelines and transportation $ 699,588 $ 723,317 Wholesale marketing and terminalling 214,750 206,918 Other 21,138 26,182 Total assets $ 935,476 $ 956,417 Property, plant and equipment and accumulated depreciation as of June 30, 2021 and depreciation expense by reporting segment for the three and six months ended June 30, 2021 were as follows (in thousands): Pipelines and Transportation Wholesale Marketing and Terminalling Consolidated Property, plant and equipment $ 587,821 $ 114,002 $ 701,823 Less: accumulated depreciation (192,077) (54,995) (247,072) Property, plant and equipment, net $ 395,744 $ 59,007 $ 454,751 Depreciation expense for the three months ended June 30, 2021 $ 8,035 $ 1,932 $ 9,967 Depreciation expense for the six months ended June 30, 2021 $ 16,862 $ 3,844 $ 20,706 In accordance with ASC 360, Property, Plant & Equipment |
Income Taxes
Income Taxes | 6 Months Ended |
Jun. 30, 2021 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income TaxesFor tax purposes, each partner of the Partnership is required to take into account its share of income, gain, loss and deduction in computing its federal and state income tax liabilities, regardless of whether cash distributions are made to such partner by the Partnership. The taxable income reportable to each partner takes into account differences between the tax basis and fair market value of our assets, financial reporting bases of assets and liabilities, the acquisition price of such partner's units and the taxable income allocation requirements under our Partnership Agreement. The Partnership is not a taxable entity for federal income tax purposes. While most states do not impose an entity level tax on partnership income, the Partnership is subject to entity level tax in both Tennessee and Texas. |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Litigation In the ordinary conduct of our business, we are from time to time subject to lawsuits, investigations and claims, including environmental claims and employee-related matters. Although we cannot predict with certainty the ultimate resolution of lawsuits, investigations and claims asserted against us, including civil penalties or other enforcement actions, we do not believe that any currently pending legal proceeding or proceedings to which we are a party will have a material adverse effect on our financial statements. See "Crude Oil and Other Releases" below for discussion of an enforcement action. Environmental, Health and Safety We are subject to extensive federal, state and local environmental and safety laws and regulations enforced by various agencies, including the Environmental Protection Agency (the "EPA"), the United States Department of Transportation, the Occupational Safety and Health Administration, as well as numerous state, regional and local environmental, safety and pipeline agencies. These laws and regulations govern the discharge of materials into the environment, waste management practices and pollution prevention measures, as well as the safe operation of our pipelines and the safety of our workers and the public. Numerous permits or other authorizations are required under these laws and regulations for the operation of our terminals, pipelines, salt wells, trucks and related operations, and may be subject to revocation, modification and renewal. These laws and permits raise potential exposure to future claims and lawsuits involving environmental and safety matters, which could include soil and water contamination, air pollution, personal injury and property damage allegedly caused by substances which we handled, used, released or disposed of, transported, or that relate to pre-existing conditions for which we have assumed responsibility. We believe that our current operations are in substantial compliance with existing environmental and safety requirements. However, there have been and we expect that there will continue to be ongoing discussions about environmental and safety matters between us and federal and state authorities, including notices of violations, citations and other enforcement actions, some of which have resulted or may result in changes to operating procedures and in capital expenditures. While it is often difficult to quantify future environmental or safety related expenditures, we anticipate that continuing capital investments and changes in operating procedures will be required to comply with existing and new requirements, as well as evolving interpretations and more strict enforcement of existing laws and regulations. Releases of hydrocarbons or hazardous substances into the environment could, to the extent the event is not insured, or is not a reimbursable event under the Omnibus Agreement, subject us to substantial expenses, including costs to respond to, contain and remediate a release, to comply with applicable laws and regulations and to resolve claims by third parties for personal injury, property damage or natural resources damages. Crude Oil and Other Releases We have experienced several crude oil and other releases involving our assets. There were no material releases that occurred during the six months ended June 30, 2021. For releases that occurred in prior years, we have received regulatory closure or a majority of the cleanup and remediation efforts are substantially complete. We expect regulatory closure in 2021 for the release sites that have not yet received it and do not anticipate material costs associated with any fines or penalties or to complete activities that may be needed to achieve regulatory closure. Regulatory authorities could require additional remediation based on the results of our remediation efforts. We may incur additional expenses as a result of further scrutiny by regulatory authorities and continued compliance with laws and regulations to which our assets are subject. As of June 30, 2021, we have accrued $0.3 million for remediation and other such matters related to these releases. On October 3, 2019, a release of diesel fuel involving one of our pipelines occurred near Sulphur Springs, Texas (the "Sulphur Springs Release"). Cleanup operations and site maintenance and remediation on this release have been substantially completed where such costs incurred totaled $7.1 million during 2019 and $0.5 million during 2020. In the fourth quarter of 2020 we submitted an actual property assessment report that assessed site conditions and recommended closure of the site. Closure of the site was approved in the first quarter of 2021. The ground water monitoring wells were removed in the second quarter of 2021. We filed suit in January 2020 against a third party contractor, seeking damages related to this release; two related actions were filed in November and December 2020 by and against the contractor's insurance company seeking judgments related to insurance coverage. We have not received notification that any legal action with respect to fines and penalties will be pursued by the regulatory agencies. Expenses incurred for the remediation of these crude oil and other releases are included in operating expenses in our condensed consolidated statements of income and comprehensive income. The majority of our releases have been subsequently reimbursed by Delek Holdings pursuant to the terms of the Omnibus Agreement, with the exception of the Sulphur Springs Release above as it is not covered under the Omnibus Agreement. Reimbursements are recorded as a reduction to operating expense. We do not believe the total costs associated with these events, whether alone or in the aggregate, including any fines or penalties and net of available insurance, indemnification or reimbursement, will have a material adverse effect upon our business, financial condition or results of operations. |
Leases
Leases | 6 Months Ended |
Jun. 30, 2021 | |
Leases [Abstract] | |
Leases | Leases We lease certain pipeline and transportation equipment. Leases with an initial term of 12 months or less are not recorded on the balance sheet; we recognize lease expense for these leases on a straight-line basis over the lease term. Our leases do not have any outstanding renewal options. Certain leases also include options to purchase the leased equipment. Certain of our lease agreements include rates based on equipment usage and others include rate inflationary indices based increases. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants. The following table presents additional information related to our operating leases in accordance ASC 842: Three Months Ended June 30, Six Months Ended June 30, (in thousands) 2021 2020 2021 2020 Lease Cost (1) Operating lease cost $ 3,365 $ 1,926 $ 6,109 $ 2,526 Short-term lease cost (2) 631 817 778 1,349 Total lease cost $ 3,996 $ 2,743 $ 6,887 $ 3,875 Other Information (1) Cash paid for amounts included in the measurement of lease liabilities Operating cash flows from operating leases $ (3,365) $ (1,926) $ (6,109) $ (2,526) Leased assets obtained in exchange for new operating lease liabilities (1) $ 2,736 $ 15,779 $ 5,572 $ 15,779 June 30, 2021 June 30, 2020 Weighted-average remaining lease term (years) for operating leases 3.5 3.8 Weighted-average discount rate (3) operating leases 5.9 % 7.3 % (1) Includes an immaterial amount of financing lease. (2) Includes an immaterial amount of variable lease cost. (3) |
Subsequent Events
Subsequent Events | 6 Months Ended |
Jun. 30, 2021 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent EventsDistribution DeclarationOn July 26, 2021, our general partner's board of directors declared a quarterly cash distribution of $0.940 per unit, payable on August 11, 2021, to unitholders of record on August 5, 2021. |
Organization and Basis of Pre_2
Organization and Basis of Presentation (Policies) | 6 Months Ended |
Jun. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Accounting | Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with U.S. generally accepted accounting principles ("GAAP") have been condensed or omitted, although management believes that the disclosures herein are adequate to make the financial information presented not misleading. Our unaudited condensed consolidated financial statements have been prepared in conformity with U.S. GAAP applied on a consistent basis with those of the annual audited financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2020 (our "Annual Report on Form 10-K"), filed with the U.S. Securities and Exchange Commission (the "SEC") on March 1, 2021 and in accordance with the rules and regulations of the SEC. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto for the year ended December 31, 2020 included in our Annual Report on Form 10-K |
Consolidation | All adjustments necessary for a fair presentation of the financial position and the results of operations for the interim periods presented have been included. All intercompany accounts and transactions have been eliminated. Such intercompany transactions do not include those with Delek Holdings or our general partner, which are presented as related parties in these accompanying condensed consolidated financial statements. All adjustments are of a normal, recurring nature. Operating results for the interim period should not be viewed as representative of results that may be expected for any future interim period or for the full year. |
New Accounting Pronouncements | New Accounting Pronouncements Adopted During 2021 ASU 2020-01, Investments—Equity Securities (Topic 321), Investments—Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815)—Clarifying the Interactions between Topic 321, Topic 323, and Topic 815 In January 2020, the Financial Accounting Standards Board (the "FASB") issued Accounting Standards Codification (" ASU") 2020-01 which is intended to clarify interactions between the guidance to account for certain equity securities under Topics 321, 323 and 815, and improve current GAAP by reducing diversity in practice and increasing comparability of accounting. The pronouncement is effective for fiscal years and interim periods within those fiscal years beginning after December 15, 2020, and early adoption is permitted. We adopted this guidance prospectively on January 1, 2021. The adoption of this guidance did not have a material impact on our business, financial condition or results of operations. Accounting Pronouncements Not Yet Adopted ASU 2020-04, Facilitation of the Effects of Reference Rate Reform on Financial Reporting (Topic 848) In March 2020, the FASB issued an amendment which is intended to provide temporary optional expedients and exceptions to GAAP guidance on contracts, hedge accounting and other transactions affected by the expected market transition from the London Interbank Offered Rate ("LIBOR") and other interbank rates. This guidance is effective for all entities any time beginning on March 12, 2020 through December 31, 2022 and may be applied from the beginning of an interim period that includes the issuance date of the ASU. The Partnership is evaluating the impact of this guidance but does not currently expect that adopting this new guidance will have a material impact on its condensed consolidated financial statements and related disclosures. |
Earnings Per Share (Policies)
Earnings Per Share (Policies) | 6 Months Ended |
Jun. 30, 2021 | |
Earnings Per Share [Abstract] | |
Net Income Per Unit | The two-class method was based on the weighted-average number of common units outstanding during the period. Basic net income per unit applicable to limited partners was computed by dividing limited partners’ interest in net income, after deducting our general partner’s 2% interest and IDRs, by the weighted-average number of outstanding common units. Our net income was allocated to our general partner and limited partners in accordance with their respective partnership percentages after giving effect to priority income allocations for IDRs, which were held by our general partner pursuant to our Prior Partnership Agreement. Earnings in excess of distributions were allocated to our general partner and limited partners based on their respective ownership interests. The IDRs were paid following the close of each quarter.Pursuant to Amendment No. 2 to the Prior Partnership Agreement, an agreement was reached for a waiver of distributions in respect of the IDRs for the GP Additional Units associated with the 5.0 million Additional Units issued in connection with the Big Spring Gathering Assets Acquisition for at least two years, through at least the distribution for the quarter ending March 31, 2022. Refer to Note 3 for additional details. |
Inventory (Policies)
Inventory (Policies) | 6 Months Ended |
Jun. 30, 2021 | |
Inventory Disclosure [Abstract] | |
Inventory | Inventory is stated at the lower of cost or net realizable value, with cost determined on a first-in, first-out basis. |
Segment Reporting (Policies)
Segment Reporting (Policies) | 6 Months Ended |
Jun. 30, 2021 | |
Segment Reporting [Abstract] | |
Segment Data | Our operating segments adhere to the accounting policies used for our consolidated financial statements. Our operating segments are managed separately because each segment requires different industry knowledge, technology and marketing strategies. Decisions concerning the allocation of resources and assessment of operating performance are made based on this segmentation. Management measures the operating performance of each of its reportable segments based on segment contribution margin. Segment contribution margin is defined as net revenues less cost of materials and other and operating expenses, excluding depreciation and amortization. |
Property, Plant and Equipment, Impairment | In accordance with ASC 360, Property, Plant & Equipment |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Related Party Transactions [Abstract] | |
Summary of Related Party Transactions | A summary of revenue, purchases from affiliates and expense transactions with Delek Holdings and its affiliates are as follows (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2021 2020 2021 2020 Revenues $ 88,722 $ 87,629 $ 184,916 $ 194,328 Purchases from Affiliates $ 74,128 $ 29,730 $ 139,943 $ 110,493 Operating and maintenance expenses $ 9,477 $ 10,310 $ 19,561 $ 23,067 General and administrative expenses $ 1,994 $ 2,703 $ 4,113 $ 6,072 |
Revenues (Tables)
Revenues (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenue | The following table represents a disaggregation of revenue for each reportable segment for the periods indicated (in thousands): Three Months Ended June 30, 2021 Pipelines and Transportation Wholesale Marketing and Terminalling Consolidated Service Revenue - Third Party $ 4,771 $ 137 $ 4,908 Service Revenue - Affiliate 3,797 8,554 12,351 Product Revenue - Third Party — 74,849 74,849 Product Revenue - Affiliate — 3,741 3,741 Lease Revenue - Affiliate (1) 61,867 10,762 72,629 Total Revenue $ 70,435 $ 98,043 $ 168,478 (1) Net of $1.8 million of amortization expense for the three months ended June 30, 2021, related to a customer contract intangible asset recorded in the wholesale marketing and terminalling segment. Six Months Ended June 30, 2021 Pipelines and Transportation Wholesale Marketing and Terminalling Consolidated Service Revenue - Third Party $ 6,698 $ 219 $ 6,917 Service Revenue - Affiliate 5,021 16,636 21,657 Product Revenue - Third Party — 129,559 129,559 Product Revenue - Affiliate — 20,128 20,128 Lease Revenue - Affiliate (1) 123,691 19,439 143,130 Total Revenue $ 135,410 $ 185,981 $ 321,391 (1) Net of $3.6 million of amortization expense for the six months ended June 30, 2021, related to a customer contract intangible asset recorded in the wholesale marketing and terminalling segment. Three Months Ended June 30, 2020 Pipelines and Transportation Wholesale Marketing and Terminalling Consolidated Service Revenue - Third Party $ 2,032 $ 204 $ 2,236 Service Revenue - Affiliate 3,326 7,810 11,136 Product Revenue - Third Party — 27,772 27,772 Product Revenue - Affiliate — 6,720 6,720 Lease Revenue - Affiliate (1) 58,068 11,705 69,773 Total Revenue $ 63,426 $ 54,211 $ 117,637 (1) Net of $1.8 million of amortization expense for the three months ended June 30, 2020, related to a customer contract intangible asset recorded in the wholesale marketing and terminalling segment. Six Months Ended June 30, 2020 Pipelines and Transportation Wholesale Marketing and Terminalling Consolidated Service Revenue - Third Party $ 11,496 $ 396 $ 11,892 Service Revenue - Affiliate 8,215 15,792 24,007 Product Revenue - Third Party — 74,818 74,818 Product Revenue - Affiliate — 58,222 58,222 Lease Revenue - Affiliate (1) 91,682 20,417 112,099 Total Revenue $ 111,393 $ 169,645 $ 281,038 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction | Our unfulfilled performance obligations as of June 30, 2021 were as follows (in thousands): Remainder of 2021 136,671 2022 253,482 2023 245,737 2024 169,475 2025 and thereafter $ 626,042 Total expected revenue on remaining performance obligations $ 1,431,407 |
Net Income Per Unit (Tables)
Net Income Per Unit (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Earnings Per Share [Abstract] | |
Summary of Cash Distributions | The calculation of net income per unit is as follows (dollars in thousands, except units and per unit amounts): Three Months Ended June 30, Six Months Ended June 30, 2021 2020 2021 2020 Net income attributable to partners $ 43,246 $ 44,415 $ 79,513 $ 72,211 Less: General partner's distribution (including IDRs) (1) — 9,479 — 18,618 Less: Limited partners' distribution 40,846 26,490 80,814 48,229 Earnings in excess (deficit) of distributions $ 2,400 $ 8,446 $ (1,301) $ 5,364 General partner's earnings: Distributions (including IDRs) (1) $ — $ 9,479 $ — $ 18,618 Allocation of earnings in excess (deficit) of distributions — 168 — 106 Total general partner's earnings $ — $ 9,647 $ — $ 18,724 Limited partners' earnings on common units: Distributions $ 40,846 $ 26,490 $ 80,814 $ 48,229 Allocation of earnings in excess (deficit) of distributions 2,400 8,278 (1,301) 5,258 Total limited partners' earnings on common units $ 43,246 $ 34,768 $ 79,513 $ 53,487 Weighted average limited partner units outstanding: Common units - basic 43,445,222 29,427,298 43,444,284 26,953,934 Common units - diluted 43,460,366 29,430,555 43,453,806 26,956,523 Net income per limited partner unit: Common units - basic $ 1.00 $ 1.18 $ 1.83 $ 1.98 Common units - diluted (2) $ 1.00 $ 1.18 $ 1.83 $ 1.98 (1) Prior to August 13, 2020, general partner distributions (including IDRs) consisted of the 2.0% general partner interest and IDRs, which represented the right of the general partner to receive increasing percentages of quarterly distributions of available cash from operating surplus in excess of 0.43125 per unit per quarter. In connection with the IDR Restructuring Transaction on August 13, 2020, the IDRs were eliminated and the general partner interest became a non-economic general partner interest. |
Equity (Tables)
Equity (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Equity [Abstract] | |
Equity Activity | The table below summarizes the changes in the number of limited partner units outstanding from December 31, 2020 through June 30, 2021. Common - Public Common - Delek Holdings Total Balance at December 31, 2020 8,697,468 34,745,868 43,443,336 Unit-based compensation awards (1) 10,097 — 10,097 Balance at June 30, 2021 8,707,565 34,745,868 43,453,433 (1) Unit-based compensation awards are presented net of 445 units withheld for taxes as of June 30, 2021. |
Summary of Allocation of General Partner's Interest in Net Income | The following table presents the allocation of the general partner's interest in net income (in thousands, except percentage of ownership interest): Three Months Ended June 30, Six Months Ended June 30, 2021 2020 2021 2020 Net income attributable to partners $ 43,246 $ 44,415 $ 79,513 $ 72,211 Less: General partner's IDRs — (8,937) — (17,632) Net income available to partners $ 43,246 $ 35,478 $ 79,513 $ 54,579 General partner's ownership interest — % 2.0 % — % 2.0 % General partner's allocated interest in net income $ — $ 710 — $ 1,092 General partner's IDRs — 8,937 — 17,632 Total general partner's interest in net income $ — $ 9,647 $ — $ 18,724 |
Summary of Distributions | The table below summarizes the quarterly distributions related to our quarterly financial results: Quarter Ended Total Quarterly Distribution Per Limited Partner Unit Total Cash Distribution Date of Distribution Unitholders Record Date June 30, 2020 $ 0.900 $ 35,969 August 12, 2020 August 7, 2020 September 30, 2020 $ 0.905 $ 39,308 November 12, 2020 November 6, 2020 December 31, 2020 $ 0.910 $ 39,533 February 9, 2021 February 2, 2021 March 31, 2021 $ 0.920 $ 39,968 May 14, 2021 May 10, 2021 June 30, 2021 $ 0.940 $ 40,846 August 11, 2021 (1) August 5, 2021 (1) Expected date of distribution. The allocations of total quarterly cash distributions made to limited partners for the three and six months ended June 30, 2021 and 2020 are set forth in the table below. Distributions earned with respect to a given period are declared subsequent to quarter end. Therefore, the table below presents total cash distributions applicable to the period in which the distributions are earned (in thousands, except per unit amounts): Three Months Ended June 30, Six Months Ended June 30, 2021 2020 2021 2020 General partner's distributions: General partner's distributions $ — $ 542 $ — $ 986 General partner's IDRs — 8,937 — 17,632 Total general partner's distributions — 9,479 — 18,618 Limited partners' distributions: Common limited partners' distributions 40,846 26,490 80,814 48,229 Total cash distributions $ 40,846 $ 35,969 $ 80,814 $ 66,847 Cash distributions per limited partner unit $ 0.940 $ 0.900 $ 1.860 $ 1.790 |
Equity Method Investments (Tabl
Equity Method Investments (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Summary of Financial Information for Equity Method Investees | Summarized unaudited financial information for Red River on a 100% basis is shown below (in thousands): June 30, 2021 December 31, 2020 Current Assets $ 21,877 $ 13,488 Non-current Assets $ 408,375 $ 413,259 Current liabilities $ 11,211 $ 7,789 Three Months Ended June 30, Six Months Ended June 30, 2021 2020 2021 2020 Revenues $ 17,744 $ 11,873 $ 26,787 $ 21,969 Gross profit $ 10,715 $ 7,175 $ 14,340 $ 13,062 Operating income $ 10,556 $ 7,000 $ 13,995 $ 12,697 Net income $ 10,551 $ 7,025 $ 13,990 $ 12,746 Combined summarized unaudited financial information for these two equity method investees on a 100% basis is shown below (in thousands): June 30, 2021 December 31, 2020 Current assets $ 20,551 $ 20,763 Non-current assets $ 248,340 $ 253,862 Current liabilities $ 2,825 $ 1,496 Three Months Ended June 30, Six Months Ended June 30, 2021 2020 2021 2020 Revenues $ 13,600 $ 12,738 $ 23,226 $ 28,185 Gross profit $ 8,739 $ 8,198 $ 13,705 $ 18,834 Operating income $ 8,244 $ 7,724 $ 12,722 $ 17,864 Net Income $ 8,544 $ 7,729 $ 12,723 $ 17,887 |
Segment Data (Tables)
Segment Data (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Segment Reporting [Abstract] | |
Summary Segment Data | The following is a summary of business segment operating performance as measured by contribution margin for the periods indicated: (in thousands) Three Months Ended June 30, Six Months Ended June 30, 2021 2020 2021 2020 Pipelines and Transportation Net revenues: Affiliate $ 65,664 $ 61,394 $ 128,712 $ 99,897 Third party 4,771 2,032 6,698 11,496 Total pipelines and transportation 70,435 63,426 135,410 111,393 Cost of materials and other 14,346 11,182 27,425 17,280 Operating expenses (excluding depreciation and amortization) 10,858 9,731 21,030 21,187 Segment contribution margin $ 45,231 $ 42,513 $ 86,955 $ 72,926 Capital spending $ 1,531 $ 417 $ 7,376 $ 863 Wholesale Marketing and Terminalling Net revenues: Affiliate (1) $ 23,058 $ 26,235 $ 56,204 $ 94,431 Third party 74,985 27,976 129,777 75,214 Total wholesale marketing and terminalling 98,043 54,211 185,981 169,645 Cost of materials and other 74,349 32,710 142,441 127,905 Operating expenses (excluding depreciation and amortization) 4,623 2,718 8,507 6,006 Segment contribution margin $ 19,071 $ 18,783 $ 35,033 $ 35,734 Capital spending $ 1,060 $ 235 $ 3,014 $ 2,818 Consolidated Net revenues: Affiliate $ 88,722 $ 87,629 $ 184,916 $ 194,328 Third party 79,756 30,008 136,475 86,710 Total Consolidated 168,478 117,637 321,391 281,038 Cost of materials and other 88,695 43,892 169,866 145,185 Operating expenses (excluding depreciation and amortization presented below) 15,481 12,449 29,537 27,193 Contribution margin $ 64,302 $ 61,296 121,988 108,660 General and administrative expenses 6,077 4,721 10,937 10,851 Depreciation and amortization 9,967 8,694 20,706 14,993 Other operating income, net (136) — (219) (107) Operating income $ 48,394 $ 47,881 $ 90,564 $ 82,923 Capital spending $ 2,591 $ 652 $ 10,390 $ 3,681 (1) Affiliate revenue for the wholesale marketing and terminalling segment is presented net of amortization expense related to a customer contract intangible asset. See Note 4 for additional information. The following table summarizes the total assets for each segment as of June 30, 2021 and December 31, 2020 (in thousands). Assets for each segment include property, plant and equipment, equity method investments, intangible assets and inventory. June 30, 2021 December 31, 2020 Pipelines and transportation $ 699,588 $ 723,317 Wholesale marketing and terminalling 214,750 206,918 Other 21,138 26,182 Total assets $ 935,476 $ 956,417 Property, plant and equipment and accumulated depreciation as of June 30, 2021 and depreciation expense by reporting segment for the three and six months ended June 30, 2021 were as follows (in thousands): Pipelines and Transportation Wholesale Marketing and Terminalling Consolidated Property, plant and equipment $ 587,821 $ 114,002 $ 701,823 Less: accumulated depreciation (192,077) (54,995) (247,072) Property, plant and equipment, net $ 395,744 $ 59,007 $ 454,751 Depreciation expense for the three months ended June 30, 2021 $ 8,035 $ 1,932 $ 9,967 Depreciation expense for the six months ended June 30, 2021 $ 16,862 $ 3,844 $ 20,706 |
Leases (Tables)
Leases (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Leases [Abstract] | |
Lease, Cost | The following table presents additional information related to our operating leases in accordance ASC 842: Three Months Ended June 30, Six Months Ended June 30, (in thousands) 2021 2020 2021 2020 Lease Cost (1) Operating lease cost $ 3,365 $ 1,926 $ 6,109 $ 2,526 Short-term lease cost (2) 631 817 778 1,349 Total lease cost $ 3,996 $ 2,743 $ 6,887 $ 3,875 Other Information (1) Cash paid for amounts included in the measurement of lease liabilities Operating cash flows from operating leases $ (3,365) $ (1,926) $ (6,109) $ (2,526) Leased assets obtained in exchange for new operating lease liabilities (1) $ 2,736 $ 15,779 $ 5,572 $ 15,779 June 30, 2021 June 30, 2020 Weighted-average remaining lease term (years) for operating leases 3.5 3.8 Weighted-average discount rate (3) operating leases 5.9 % 7.3 % (1) Includes an immaterial amount of financing lease. (2) Includes an immaterial amount of variable lease cost. (3) |
Organization and Basis of Pre_3
Organization and Basis of Presentation Organization and Basis of Presentation (Details) | Aug. 13, 2020 |
Delek Logistics GP | |
Distribution Made to Limited Partner [Line Items] | |
General Partner Economic Interest, Pecent | 2.00% |
Acquisitions - Narrative (Detai
Acquisitions - Narrative (Details) $ / shares in Units, shares in Millions, $ in Millions | May 01, 2020USD ($)Truck_Trailer | Mar. 31, 2020USD ($)storage_tankmibbl$ / sharesshares |
Delek Trucking [Member] | ||
Schedule of Asset Acquisitions, by Acquisition [Line Items] | ||
Consideration transferred | $ 48 | |
Number Of Trucks and Trailers | Truck_Trailer | 150 | |
Asset Acquisition, Carry Value Of Assets Acquired | $ 13.3 | |
Asset Acquisition, Carry Value Of Assets Acquired, Owned Assets | 0.5 | |
Asset Acquisition, Carry Value Of Assets Acquired, Right-Of-Use Assets | 12.8 | |
Asset Acquisition, Transaction Cost | $ 0.3 | |
Big Spring Gathering Asset | ||
Schedule of Asset Acquisitions, by Acquisition [Line Items] | ||
Consideration transferred | $ 100 | |
Asset Acquisition, Carry Value Of Assets Acquired | 209.5 | |
Asset Acquisition, Transaction Cost | $ 0.7 | |
Asset Acquisition, Equity Interest Transfered As Consideration, Shares | shares | 5 | |
Number Of Miles Of Gathering Systems | mi | 200 | |
Number of storage tanks | storage_tank | 65 | |
Total Storage Of Terminals | bbl | 650,000 | |
Asset Acquisition, Equity Interest Transfered As Consideration, Market Price | $ / shares | $ 9.10 | |
Asset Acquisition, Equity Interest Transfered As Consideration, Value | $ 109.5 |
Related Party Transactions - Co
Related Party Transactions - Commercial Agreements (Details) - Delek US and affiliates | 6 Months Ended |
Jun. 30, 2021 | |
Minimum [Member] | |
Related Party Transaction [Line Items] | |
Commercial Agreements, Initial Term | 5 years |
Maximum | |
Related Party Transaction [Line Items] | |
Commercial Agreements, Initial Term | 10 years |
Related Party Transactions - Om
Related Party Transactions - Omnibus Agreement (Details) - Omnibus Agreement - Delek US and affiliates - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |
Jun. 30, 2021 | Jun. 30, 2021 | Jun. 30, 2020 | |
Related Party Transaction [Line Items] | |||
Related Party Annual Service Fee | $ 4.7 | ||
Delek US | Operating Expense [Member] | |||
Related Party Transaction [Line Items] | |||
Reimbursement for costs incurred for asset failures | $ 0.1 | ||
Delek US | Other long term liabilities | |||
Related Party Transaction [Line Items] | |||
Reimbursement of capital expenditures by Delek Holdings | $ 0 | $ 0 | $ 0.6 |
Related Party Transactions - Ad
Related Party Transactions - Additional Information (Details) - USD ($) $ in Millions | Aug. 13, 2020 | Mar. 31, 2020 | Mar. 31, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | Mar. 01, 2020 | Feb. 29, 2020 |
Related Party Transaction [Line Items] | |||||||||
Stock Repurchased During Period, Value | $ 5 | ||||||||
Revolving Credit Facility | DKL Revolver | Fifth Third Bank | Line of Credit | |||||||||
Related Party Transaction [Line Items] | |||||||||
Cash Consideration Received | $ 45 | ||||||||
Delek US Holdings, Inc. | |||||||||
Related Party Transaction [Line Items] | |||||||||
Delek's limited partner ownership interest (as percent) | 80.00% | ||||||||
Limited Liability Company or Limited Partnership, Members or Limited Partners, Ownership Interest, Shares | 34,700,000 | ||||||||
Delek Logistics GP | |||||||||
Related Party Transaction [Line Items] | |||||||||
General Partner Economic Interest, Pecent | 2.00% | ||||||||
Common unitholders - Delek | Limited Partner | |||||||||
Related Party Transaction [Line Items] | |||||||||
Common Limited Partner Units Issued In Restructuring Transaction | 451,822 | ||||||||
Delek US Holdings, Inc. | Delek Logistics | |||||||||
Related Party Transaction [Line Items] | |||||||||
Business Combination, Consideration Transferred Equity Interests Issued And Issuable, Shares | 14,000,000 | ||||||||
Delek US Holdings, Inc. | General Partnership | |||||||||
Related Party Transaction [Line Items] | |||||||||
Ownership Interest in General Partner (as percent) | 100.00% | ||||||||
Delek US Holdings, Inc. | General Partnership | Delek Logistics GP | |||||||||
Related Party Transaction [Line Items] | |||||||||
Business Acquisition, Percentage of Voting Interests Acquired | 5.20% | ||||||||
Delek US and affiliates | |||||||||
Related Party Transaction [Line Items] | |||||||||
Related Party. Ownership Percentage In Company | 70.50% | 70.50% | 62.60% | 64.50% | |||||
Delek US and affiliates | DPG Management Agreement, Operating Service And Construction Fee Paid To Partnership | |||||||||
Related Party Transaction [Line Items] | |||||||||
Related Party Transaction, Expenses from Transactions with Related Party | $ 0.4 | $ 0.4 | $ 0.8 | $ 1.2 | |||||
Big Spring Gathering Asset | |||||||||
Related Party Transaction [Line Items] | |||||||||
Asset Acquisition, Equity Interest Transfered As Consideration, Shares | 5,000,000 |
Related Party Transactions - Su
Related Party Transactions - Summary of Transactions (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | ||
Related Party Transaction [Line Items] | |||||
Revenues | [1] | $ 88,722 | $ 87,629 | $ 184,916 | $ 194,328 |
Delek US and affiliates | |||||
Related Party Transaction [Line Items] | |||||
Revenues | 88,722 | 87,629 | 184,916 | 194,328 | |
General and administrative expenses | 1,994 | 2,703 | 4,113 | 6,072 | |
Purchases from Affiliates | Delek US and affiliates | |||||
Related Party Transaction [Line Items] | |||||
Purchases from Affiliates | 74,128 | 29,730 | 139,943 | 110,493 | |
Operating and maintenance expense | Delek US and affiliates | |||||
Related Party Transaction [Line Items] | |||||
Operating and maintenance expenses | $ 9,477 | $ 10,310 | $ 19,561 | $ 23,067 | |
[1] | See Note 3 for a description of our material affiliate revenue transactions. |
Related Party Transactions - Qu
Related Party Transactions - Quarterly Cash Distributions (Details) - USD ($) $ in Thousands | Aug. 11, 2021 | May 14, 2021 | Feb. 09, 2021 | Nov. 12, 2020 | Aug. 12, 2020 | May 12, 2020 | Feb. 12, 2020 |
Related Party Transaction [Line Items] | |||||||
Distribution Made to Limited Partner, Cash Distributions Paid | $ 39,968 | $ 39,533 | $ 39,308 | $ 35,969 | $ 30,900 | $ 30,600 | |
Subsequent Event | |||||||
Related Party Transaction [Line Items] | |||||||
Distribution Made to Limited Partner, Cash Distributions Paid | $ 40,846 | ||||||
Delek US and affiliates | |||||||
Related Party Transaction [Line Items] | |||||||
Distribution Made to Limited Partner, Cash Distributions Paid | $ 32,000 | $ 31,600 | $ 23,200 | $ 22,600 | |||
Delek US and affiliates | Subsequent Event | |||||||
Related Party Transaction [Line Items] | |||||||
Distribution Made to Limited Partner, Cash Distributions Paid | $ 32,700 |
Revenues (Details)
Revenues (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | Dec. 31, 2020 | |
Disaggregation of Revenue [Line Items] | |||||
Property, plant and equipment | $ 454,751 | $ 454,751 | $ 464,812 | ||
Total revenue | 168,478 | $ 117,637 | 321,391 | $ 281,038 | |
Amortization of customer contract intangible assets | 1,800 | 1,800 | 3,606 | 3,605 | |
Revenue, remaining performance obligation | 1,431,407 | 1,431,407 | |||
Service Revenue - Third Party | |||||
Disaggregation of Revenue [Line Items] | |||||
Total revenue | 4,908 | 2,236 | 6,917 | 11,892 | |
Service Revenue - Affiliate (1) | |||||
Disaggregation of Revenue [Line Items] | |||||
Total revenue | 12,351 | 11,136 | 21,657 | 24,007 | |
Product Revenue - Third Party | |||||
Disaggregation of Revenue [Line Items] | |||||
Total revenue | 74,849 | 27,772 | 129,559 | 74,818 | |
Product Revenue - Affiliate | |||||
Disaggregation of Revenue [Line Items] | |||||
Total revenue | 3,741 | 6,720 | 20,128 | 58,222 | |
Lease Revenue - Affiliate | |||||
Disaggregation of Revenue [Line Items] | |||||
Total revenue | 72,629 | 69,773 | 143,130 | 112,099 | |
Pipelines and transportation | |||||
Disaggregation of Revenue [Line Items] | |||||
Property, plant and equipment | 395,744 | 395,744 | |||
Total revenue | 70,435 | 63,426 | 135,410 | 111,393 | |
Pipelines and transportation | Service Revenue - Third Party | |||||
Disaggregation of Revenue [Line Items] | |||||
Total revenue | 4,771 | 2,032 | 6,698 | 11,496 | |
Pipelines and transportation | Service Revenue - Affiliate (1) | |||||
Disaggregation of Revenue [Line Items] | |||||
Total revenue | 3,797 | 3,326 | 5,021 | 8,215 | |
Pipelines and transportation | Product Revenue - Third Party | |||||
Disaggregation of Revenue [Line Items] | |||||
Total revenue | 0 | 0 | 0 | 0 | |
Pipelines and transportation | Product Revenue - Affiliate | |||||
Disaggregation of Revenue [Line Items] | |||||
Total revenue | 0 | 0 | 0 | 0 | |
Pipelines and transportation | Lease Revenue - Affiliate | |||||
Disaggregation of Revenue [Line Items] | |||||
Total revenue | 61,867 | 58,068 | 123,691 | 91,682 | |
Wholesale marketing and terminalling | |||||
Disaggregation of Revenue [Line Items] | |||||
Property, plant and equipment | 59,007 | 59,007 | |||
Total revenue | 98,043 | 54,211 | 185,981 | 169,645 | |
Wholesale marketing and terminalling | Service Revenue - Third Party | |||||
Disaggregation of Revenue [Line Items] | |||||
Total revenue | 137 | 204 | 219 | 396 | |
Wholesale marketing and terminalling | Service Revenue - Affiliate (1) | |||||
Disaggregation of Revenue [Line Items] | |||||
Total revenue | 8,554 | 7,810 | 16,636 | 15,792 | |
Wholesale marketing and terminalling | Product Revenue - Third Party | |||||
Disaggregation of Revenue [Line Items] | |||||
Total revenue | 74,849 | 27,772 | 129,559 | 74,818 | |
Wholesale marketing and terminalling | Product Revenue - Affiliate | |||||
Disaggregation of Revenue [Line Items] | |||||
Total revenue | 3,741 | 6,720 | 20,128 | 58,222 | |
Wholesale marketing and terminalling | Lease Revenue - Affiliate | |||||
Disaggregation of Revenue [Line Items] | |||||
Total revenue | 10,762 | $ 11,705 | 19,439 | $ 20,417 | |
Assets Leased to Others | |||||
Disaggregation of Revenue [Line Items] | |||||
Property, plant and equipment | $ 383,000 | $ 383,000 | |||
Maximum | Delek US and affiliates | |||||
Disaggregation of Revenue [Line Items] | |||||
Term Of Agreement | 10 years | ||||
Minimum [Member] | Delek US and affiliates | |||||
Disaggregation of Revenue [Line Items] | |||||
Term Of Agreement | 5 years |
Revenues - Remaining Performanc
Revenues - Remaining Performance Obligation Expected Timing of Satisfaction - Period (Details) $ in Thousands | Jun. 30, 2021USD ($) |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation | $ 1,431,407 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2020-04-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation, expected timing of satisfaction | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-07-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation, expected timing of satisfaction | 6 months |
Revenue, remaining performance obligation | $ 136,671 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation, expected timing of satisfaction | 1 year |
Revenue, remaining performance obligation | $ 253,482 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation, expected timing of satisfaction | 1 year |
Revenue, remaining performance obligation | $ 245,737 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation, expected timing of satisfaction | 1 year |
Revenue, remaining performance obligation | $ 169,475 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2025-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation, expected timing of satisfaction | |
Revenue, remaining performance obligation | $ 626,042 |
Net Income Per Unit - Narrative
Net Income Per Unit - Narrative (Details) - shares shares in Millions | Aug. 12, 2020 | Mar. 31, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 |
General Partnership | ||||||
General partner's ownership interest (as percent) | 2.00% | 0.00% | 2.00% | 0.00% | 2.00% | |
Big Spring Gathering Asset | ||||||
Asset Acquisition, Equity Interest Transfered As Consideration, Shares | 5 |
Net Income Per Unit (Details)
Net Income Per Unit (Details) - USD ($) $ / shares in Units, $ in Thousands | Aug. 12, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 |
Net Income Per Unit [Line Items] | |||||
Net income attributable to partners | $ 43,246 | $ 44,415 | $ 79,513 | $ 72,211 | |
Less: Partners' distribution | 40,846 | 26,490 | 80,814 | 48,229 | |
Allocation of earnings in excess (deficit) of distributions | $ 2,400 | $ 8,446 | $ (1,301) | $ 5,364 | |
Footnote [Abstract] | |||||
Common Units Excluded From Computation Of Earnings Per Unit, Units | 3,662 | 18,270 | 1,841 | 18,270 | |
Common Units | |||||
Net Income Per Unit [Line Items] | |||||
Common units - (basic) (in shares) | 43,445,222 | 29,427,298 | 43,444,284 | 26,953,934 | |
Common units - (diluted) (in shares) | 43,460,366 | 29,430,555 | 43,453,806 | 26,956,523 | |
Common units - (basic) (in dollars per share) | $ 1 | $ 1.18 | $ 1.83 | $ 1.98 | |
Common units - (diluted) (in dollars per share) | $ 1 | $ 1.18 | $ 1.83 | $ 1.98 | |
General Partner | |||||
Net Income Per Unit [Line Items] | |||||
Net income attributable to partners | $ 9,647 | $ 18,724 | |||
Less: General partner's distribution (including IDRs) | $ 0 | 9,479 | $ 0 | 18,618 | |
Allocation of earnings in excess (deficit) of distributions | 0 | 168 | 0 | 106 | |
Total partner's earnings | 0 | 9,647 | 0 | 18,724 | |
Common unitholders | |||||
Net Income Per Unit [Line Items] | |||||
Less: Partners' distribution | 40,846 | 26,490 | 80,814 | 48,229 | |
Allocation of earnings in excess (deficit) of distributions | 2,400 | 8,278 | (1,301) | 5,258 | |
Common unitholders | Common Units | |||||
Net Income Per Unit [Line Items] | |||||
Total partner's earnings | $ 43,246 | $ 34,768 | $ 79,513 | $ 53,487 | |
Common units - (basic) (in shares) | 43,445,222 | 29,427,298 | 43,444,284 | 26,953,934 | |
Common units - (diluted) (in shares) | 43,460,366 | 29,430,555 | 43,453,806 | 26,956,523 | |
Common units - (basic) (in dollars per share) | $ 1 | $ 1.18 | $ 1.83 | $ 1.98 | |
Common units - (diluted) (in dollars per share) | $ 1 | $ 1.18 | 1.83 | $ 1.98 | |
Maximum | |||||
Footnote [Abstract] | |||||
Distribution Payment Targets | $ 0.43125 | ||||
General Partnership | |||||
Footnote [Abstract] | |||||
General partner's ownership interest (as percent) | 2.00% | 0.00% | 2.00% | 0.00% | 2.00% |
Inventory (Details)
Inventory (Details) - USD ($) $ in Thousands | Jun. 30, 2021 | Dec. 31, 2020 |
Inventory Disclosure [Abstract] | ||
Inventories | $ 1,988 | $ 3,127 |
Long-Term Obligations - 7.125%
Long-Term Obligations - 7.125% Senior Notes Due 2028 (Details) - Senior Notes - USD ($) | May 24, 2021 | Jun. 30, 2021 |
Senior 2028 Notes | ||
Debt Instrument [Line Items] | ||
Face amount of debt | $ 400,000,000 | |
Interest rate (as percent) | 7.125% | |
Long-term Line of Credit | $ 400,000,000 | |
Deferred financing costs | $ 6,300,000 | |
2028 Notes | ||
Debt Instrument [Line Items] | ||
Debt Instrument, Redemption Price, Percentage of Principal Amount Redeemed | 35.00% | |
2028 Notes | Period prior to June 1, 2024 | ||
Debt Instrument [Line Items] | ||
Redemption price (as percent) | 107.125% | |
2028 Notes | Twelve-month period beginning on June1, 2024 | ||
Debt Instrument [Line Items] | ||
Redemption price (as percent) | 103.563% | |
2028 Notes | Twelve-month period beginning on June 1, 2025 | ||
Debt Instrument [Line Items] | ||
Redemption price (as percent) | 101.781% | |
2028 Notes | Twelve-month period beginning on June 1, 2026 | ||
Debt Instrument [Line Items] | ||
Redemption price (as percent) | 100.00% |
Long-Term Obligations - DKL Cre
Long-Term Obligations - DKL Credit Facility (Details) - Line of Credit - Revolving Credit Facility - Fifth Third Bank - USD ($) | Aug. 13, 2020 | Jun. 30, 2021 | Sep. 28, 2018 |
Line of Credit Facility [Line Items] | |||
Weighted average interest rate (as percent) | 2.50% | ||
Prime Rate | United States of America, Dollars | |||
Line of Credit Facility [Line Items] | |||
Variable rate description | U.S. dollar prime rate | ||
London Interbank Offered Rate (LIBOR) | United States of America, Dollars | |||
Line of Credit Facility [Line Items] | |||
Variable rate description | LIBOR | ||
Canadian prime rate | Canada, Dollars | |||
Line of Credit Facility [Line Items] | |||
Variable rate description | Canadian dollar prime rate | ||
Canadian Dealer Offered Rate (CDOR) | Canada, Dollars | |||
Line of Credit Facility [Line Items] | |||
Variable rate description | Canadian Dealer Offered Rate | ||
DKL Revolver | |||
Line of Credit Facility [Line Items] | |||
Maximum lender commitment | $ 850,000,000 | ||
Maximum amount under accordion feature | $ 1,000,000,000 | ||
Cash Consideration Received | $ 45,000,000 | ||
Increase (Decrease) in Restricted Cash | $ 20,000,000 | ||
Second Amended and Restated Credit Agreement | |||
Line of Credit Facility [Line Items] | |||
Commitment fee (as percent) | 0.35% | ||
Outstanding borrowings | $ 288,800,000 | ||
Letters of credit outstanding | 0 | ||
Unused credit commitment | $ 561,200,000 |
Long-Term Obligations - 6.75% S
Long-Term Obligations - 6.75% Senior Notes Due 2025 (Details) - Senior Notes - Senior 2025 Notes - USD ($) | May 23, 2017 | Jun. 30, 2021 | Dec. 31, 2020 |
Debt Instrument [Line Items] | |||
Face amount of debt | $ 250,000,000 | ||
Interest rate (as percent) | 6.75% | ||
Purchase price (as percent) | 101.00% | ||
Long-term Line of Credit | $ 250,000,000 | ||
Debt Instrument, Interest Rate, Effective Percentage | 7.21% | ||
Deferred financing costs | $ 2,900,000 | $ 3,300,000 | |
Debt discount | $ 900,000 | $ 1,000,000 | |
Twelve-month period beginning on May 15, 2021 | |||
Debt Instrument [Line Items] | |||
Redemption price (as percent) | 103.375% | ||
Twelve-month period beginning on May 15, 2022 | |||
Debt Instrument [Line Items] | |||
Redemption price (as percent) | 101.688% | ||
Beginning on May 15, 2023 and thereafter | |||
Debt Instrument [Line Items] | |||
Redemption price (as percent) | 100.00% |
Equity - Narrative (Details)
Equity - Narrative (Details) - USD ($) $ in Millions | Aug. 13, 2020 | Jun. 30, 2021 | Dec. 31, 2020 | Aug. 31, 2020 |
Common unitholders - public | ||||
Class of Stock [Line Items] | ||||
Common units outstanding (in shares) | 8,707,565 | 8,697,468 | ||
Common unitholders - Delek | ||||
Class of Stock [Line Items] | ||||
Common units outstanding (in shares) | 34,745,868 | 34,745,868 | ||
Limited Partner | Delek US | ||||
Class of Stock [Line Items] | ||||
Limited Partners Interest In Partnership, Shares | 14,000,000 | |||
Limited Partner | Common unitholders - public | ||||
Class of Stock [Line Items] | ||||
Common units outstanding (in shares) | 8,707,565 | |||
Limited Partner | Common unitholders - Delek | ||||
Class of Stock [Line Items] | ||||
Common units outstanding (in shares) | 34,745,868 | |||
Delek US Holdings, Inc. | ||||
Class of Stock [Line Items] | ||||
Delek's limited partner ownership interest (as percent) | 80.00% | |||
Delek US Holdings, Inc. | General Partnership | ||||
Class of Stock [Line Items] | ||||
Business Combination, Acquisition Related Costs | $ 1.1 |
Equity - Equity Activity (Detai
Equity - Equity Activity (Details) | 6 Months Ended |
Jun. 30, 2021shares | |
Increase (Decrease) in Partners' Capital (Roll Forward) | |
Beginning Balance | 43,443,336 |
Unit-based compensation awards | 10,097 |
Ending Balance | 43,453,433 |
Units withheld for taxes | 445 |
Limited Partner | Common unitholders - public | |
Increase (Decrease) in Partners' Capital (Roll Forward) | |
Beginning Balance | 8,697,468 |
Unit-based compensation awards | 10,097 |
Ending Balance | 8,707,565 |
Limited Partner | Common unitholders - Delek | |
Increase (Decrease) in Partners' Capital (Roll Forward) | |
Beginning Balance | 34,745,868 |
Unit-based compensation awards | 0 |
Ending Balance | 34,745,868 |
Equity - Allocations of Net Inc
Equity - Allocations of Net Income (Details) - USD ($) $ in Thousands | Aug. 12, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Net income attributable to partners | $ 43,246 | $ 44,415 | $ 79,513 | $ 72,211 | ||
Less: General partner's IDRs | 0 | (8,937) | 0 | (17,632) | ||
Net income available to partners | 43,246 | 35,478 | 79,513 | 54,579 | ||
General partner's allocated interest in net income | 0 | 710 | 0 | 1,092 | ||
General partner's IDRs | 0 | 8,937 | 0 | 17,632 | ||
Total general partner's interest in net income | [1] | $ 0 | $ 9,647 | $ 0 | $ 18,724 | |
General Partnership | ||||||
General partner's ownership interest (as percent) | 2.00% | 0.00% | 2.00% | 0.00% | 2.00% | |
[1] | See Note 3 for a description of the IDR Restructuring Transaction. |
Equity - Incentive Distribution
Equity - Incentive Distribution Rights (Details) - $ / shares shares in Millions | Aug. 12, 2020 | Mar. 31, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 |
Incentive Distribution Made to Managing Member or General Partner [Line Items] | ||||||
Limited Liability Company (LLC) or Limited Partnership (LP), Managing Member or General Partner, Ownership Interest, Increasing Percentage, Maximum | 48.00% | |||||
Maximum | ||||||
Incentive Distribution Made to Managing Member or General Partner [Line Items] | ||||||
Distribution Payment Targets | $ 0.43125 | |||||
General Partnership | ||||||
Incentive Distribution Made to Managing Member or General Partner [Line Items] | ||||||
General partner's ownership interest (as percent) | 2.00% | 0.00% | 2.00% | 0.00% | 2.00% | |
Big Spring Gathering Asset | ||||||
Incentive Distribution Made to Managing Member or General Partner [Line Items] | ||||||
Asset Acquisition, Equity Interest Transfered As Consideration, Shares | 5 |
Equity - Cash Distributions (De
Equity - Cash Distributions (Details) - USD ($) $ / shares in Units, $ in Thousands | Aug. 11, 2021 | May 14, 2021 | Feb. 09, 2021 | Nov. 12, 2020 | Aug. 12, 2020 | May 12, 2020 | Feb. 12, 2020 |
Distribution Made to Limited Partner [Line Items] | |||||||
Total Quarterly Distribution Per Limited Partner Unit - Paid (in dollars per share) | $ 0.920 | $ 0.910 | $ 0.905 | $ 0.900 | |||
Total Cash Distribution, including general partner interest and IDRs | $ 39,968 | $ 39,533 | $ 39,308 | $ 35,969 | $ 30,900 | $ 30,600 | |
Subsequent Event | |||||||
Distribution Made to Limited Partner [Line Items] | |||||||
Total Quarterly Distribution Per Limited Partner Unit - Paid (in dollars per share) | $ 0.940 | ||||||
Total Cash Distribution, including general partner interest and IDRs | $ 40,846 |
Equity - Distributions Earned (
Equity - Distributions Earned (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Equity [Abstract] | ||||
General partner's distributions | $ 0 | $ 542 | $ 0 | $ 986 |
General partner's IDRs | 0 | 8,937 | 0 | 17,632 |
Total general partner's distributions | 0 | 9,479 | 0 | 18,618 |
Common limited partners' distributions | 40,846 | 26,490 | 80,814 | 48,229 |
Total cash distributions | $ 40,846 | $ 35,969 | $ 80,814 | $ 66,847 |
Cash distributions per limited partner unit (in dollars per share) | $ 0.940 | $ 0.900 | $ 1.860 | $ 1.790 |
Equity Based Compensation (Deta
Equity Based Compensation (Details) - Delek Logistics GP 2012 Long-Term Incentive Plan - Common Stock | Jun. 09, 2021shares |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Share-based Compensation Arrangement by Share-based Payment Award, Number of Additional Shares Authorized | 300,000 |
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized | 912,207 |
Equity Method Investments (Deta
Equity Method Investments (Details) $ in Thousands | 1 Months Ended | 6 Months Ended | 12 Months Ended | |
May 31, 2019USD ($) | Jun. 30, 2021USD ($)joint_venture | Jun. 30, 2020USD ($) | Dec. 31, 2020USD ($) | |
Schedule of Equity Method Investments [Line Items] | ||||
Investment in joint ventures | $ 252,048 | $ 253,675 | ||
Payments to Acquire Equity Method Investments | $ 1,393 | $ 10,515 | ||
Equity method investments, number of joint ventures | joint_venture | 3 | |||
Red River | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Investment in joint ventures | $ 124,700 | |||
Ownership interest (as percent) | 33.00% | |||
CP LLC And Rangeland Energy | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Equity method investments, number of joint ventures | joint_venture | 2 | |||
CP LLC | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Ownership interest (as percent) | 50.00% | |||
Rangeland Rio | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Ownership interest (as percent) | 33.00% | |||
Red River Start Up Capital | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Payments to Acquire Equity Method Investments | $ 400 | |||
Red River Expansion | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Payments to Acquire Equity Method Investments | $ 3,500 | $ 1,400 | $ 12,200 |
Equity Method Investments - Sum
Equity Method Investments - Summarized Financial Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | Dec. 31, 2020 | |
Schedule of Equity Method Investments [Line Items] | |||||
Current Assets | $ 23,126 | $ 23,126 | $ 29,309 | ||
Current liabilities | 67,527 | 67,527 | 28,300 | ||
Revenues | 168,478 | $ 117,637 | 321,391 | $ 281,038 | |
Operating income | 48,394 | 47,881 | 90,564 | 82,923 | |
Net Income | 43,246 | 44,415 | 79,513 | 72,211 | |
Equity Method Investment, Nonconsolidated Investee or Group of Investees [Member] | Red River | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Current Assets | 21,877 | 21,877 | 13,488 | ||
Non-current Assets | 408,375 | 408,375 | 413,259 | ||
Current liabilities | 11,211 | 11,211 | 7,789 | ||
Revenues | 17,744 | 11,873 | 26,787 | 21,969 | |
Gross Profit | 10,715 | 7,175 | 14,340 | 13,062 | |
Operating income | 10,556 | 7,000 | 13,995 | 12,697 | |
Net Income | 10,551 | 7,025 | 13,990 | 12,746 | |
Equity Method Investment, Nonconsolidated Investee or Group of Investees [Member] | Joint Ventures [Member] | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Current Assets | 20,551 | 20,551 | 20,763 | ||
Non-current Assets | 248,340 | 248,340 | 253,862 | ||
Current liabilities | 2,825 | 2,825 | $ 1,496 | ||
Revenues | 13,600 | 12,738 | 23,226 | 28,185 | |
Gross Profit | 8,739 | 8,198 | 13,705 | 18,834 | |
Operating income | 8,244 | 7,724 | 12,722 | 17,864 | |
Net Income | $ 8,544 | $ 7,729 | $ 12,723 | $ 17,887 |
Segment Data - Narrative (Detai
Segment Data - Narrative (Details) | 6 Months Ended |
Jun. 30, 2021segment | |
Segment Reporting [Abstract] | |
Number of reportable segments | 2 |
Segment Data (Details)
Segment Data (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | Dec. 31, 2020 | ||
Segment Reporting Information [Line Items] | ||||||
Affiliates (1) | [1] | $ 88,722 | $ 87,629 | $ 184,916 | $ 194,328 | |
Third party | 79,756 | 30,008 | 136,475 | 86,710 | ||
Net revenues | 168,478 | 117,637 | 321,391 | 281,038 | ||
Cost of materials and other | 88,695 | 43,892 | 169,866 | 145,185 | ||
Operating expenses (excluding depreciation and amortization presented below) | 15,481 | 12,449 | 29,537 | 27,193 | ||
Segment contribution margin | 64,302 | 61,296 | 121,988 | 108,660 | ||
General and administrative expenses | 6,077 | 4,721 | 10,937 | 10,851 | ||
Depreciation and amortization | 9,967 | 8,694 | 20,706 | 14,993 | ||
Other operating income, net | (136) | 0 | (219) | (107) | ||
Operating income | 48,394 | 47,881 | 90,564 | 82,923 | ||
Capital spending | 2,591 | 652 | 10,390 | 3,681 | ||
Total assets | 935,476 | 935,476 | $ 956,417 | |||
Pipelines and transportation | ||||||
Segment Reporting Information [Line Items] | ||||||
Affiliates (1) | 65,664 | 61,394 | 128,712 | 99,897 | ||
Third party | 4,771 | 2,032 | 6,698 | 11,496 | ||
Net revenues | 70,435 | 63,426 | 135,410 | 111,393 | ||
Operating expenses (excluding depreciation and amortization presented below) | 10,858 | 9,731 | 21,030 | 21,187 | ||
Segment contribution margin | 45,231 | 42,513 | 86,955 | 72,926 | ||
Capital spending | 1,531 | 417 | 7,376 | 863 | ||
Total assets | 699,588 | 699,588 | 723,317 | |||
Wholesale marketing and terminalling | ||||||
Segment Reporting Information [Line Items] | ||||||
Affiliates (1) | 23,058 | 26,235 | 56,204 | 94,431 | ||
Third party | 74,985 | 27,976 | 129,777 | 75,214 | ||
Net revenues | 98,043 | 54,211 | 185,981 | 169,645 | ||
Operating expenses (excluding depreciation and amortization presented below) | 4,623 | 2,718 | 8,507 | 6,006 | ||
Segment contribution margin | 19,071 | 18,783 | 35,033 | 35,734 | ||
Capital spending | 1,060 | 235 | 3,014 | 2,818 | ||
Total assets | 214,750 | 214,750 | 206,918 | |||
Other Segments | ||||||
Segment Reporting Information [Line Items] | ||||||
Total assets | 21,138 | 21,138 | $ 26,182 | |||
Service | ||||||
Segment Reporting Information [Line Items] | ||||||
Cost of materials and other | 88,695 | 43,892 | 169,866 | 145,185 | ||
Service | Pipelines and transportation | ||||||
Segment Reporting Information [Line Items] | ||||||
Cost of materials and other | 14,346 | 11,182 | 27,425 | 17,280 | ||
Service | Wholesale marketing and terminalling | ||||||
Segment Reporting Information [Line Items] | ||||||
Cost of materials and other | $ 74,349 | $ 32,710 | $ 142,441 | $ 127,905 | ||
[1] | See Note 3 for a description of our material affiliate revenue transactions. |
Segment Data - PP&E (Details)
Segment Data - PP&E (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |
Jun. 30, 2021 | Jun. 30, 2021 | Dec. 31, 2020 | |
Segment Reporting Information [Line Items] | |||
Property, plant and equipment | $ 701,823 | $ 701,823 | $ 692,282 |
Less: accumulated depreciation | (247,072) | (247,072) | (227,470) |
Property, plant and equipment, net | 454,751 | 454,751 | $ 464,812 |
Depreciation expense | 9,967 | 20,706 | |
Pipelines and transportation | |||
Segment Reporting Information [Line Items] | |||
Property, plant and equipment | 587,821 | 587,821 | |
Less: accumulated depreciation | (192,077) | (192,077) | |
Property, plant and equipment, net | 395,744 | 395,744 | |
Depreciation expense | 8,035 | 16,862 | |
Wholesale marketing and terminalling | |||
Segment Reporting Information [Line Items] | |||
Property, plant and equipment | 114,002 | 114,002 | |
Less: accumulated depreciation | (54,995) | (54,995) | |
Property, plant and equipment, net | 59,007 | 59,007 | |
Depreciation expense | $ 1,932 | $ 3,844 |
Commitments and Contingencies -
Commitments and Contingencies - Crude Oil Releases (Details) $ in Millions | 3 Months Ended | 6 Months Ended | |
Mar. 31, 2021USD ($) | Mar. 31, 2020USD ($) | Jun. 30, 2021USD ($)crudeOilRelease | |
Loss Contingencies [Line Items] | |||
Number Of Crude Oil Releases | crudeOilRelease | 0 | ||
Accrual for Environmental Loss Contingencies, Charges to Expense for New Losses | $ 0.5 | $ 7.1 | |
Operating Expense [Member] | |||
Loss Contingencies [Line Items] | |||
Accrual for environmental loss contingencies | $ 0.3 |
Leases - Lease Cost and Other I
Leases - Lease Cost and Other Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Leases [Abstract] | ||||
Operating lease cost | $ 3,365 | $ 1,926 | $ 6,109 | $ 2,526 |
Short-term lease cost | 631 | 817 | 778 | 1,349 |
Total lease cost | 3,996 | 2,743 | 6,887 | 3,875 |
Cash paid for amounts included in the measurement of lease liabilities | ||||
Operating cash flows from operating leases | (3,365) | $ (1,926) | (6,109) | (2,526) |
Lease assets obtained in exchange for new operating lease liabilities | $ 2,736 | $ 5,572 | $ 15,779 | |
Weighted-average remaining lease term (years) for operating leases | 3 years 6 months | 3 years 9 months 18 days | 3 years 6 months | 3 years 9 months 18 days |
Operating Lease, Weighted Average Discount Rate, Percent | 5.90% | 7.30% | 5.90% | 7.30% |
Subsequent Events - Distributio
Subsequent Events - Distribution Declaration (Details) - $ / shares | Aug. 11, 2021 | May 14, 2021 | Feb. 09, 2021 | Nov. 12, 2020 | Aug. 12, 2020 |
Subsequent Event [Line Items] | |||||
Distribution Made to Limited Partner, Distributions Paid, Per Unit | $ 0.920 | $ 0.910 | $ 0.905 | $ 0.900 | |
Subsequent Event | |||||
Subsequent Event [Line Items] | |||||
Distribution Made to Limited Partner, Distributions Paid, Per Unit | $ 0.940 |