Document And Entity Information
Document And Entity Information - shares | 9 Months Ended | ||
Sep. 30, 2015 | Oct. 29, 2015 | Dec. 31, 2014 | |
Entity Information [Line Items] | |||
Preferred Units, Outstanding | 30,158,619 | 30,158,619 | |
Entity Registrant Name | Blueknight Energy Partners, L.P. | ||
Entity Central Index Key | 1,392,091 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Accelerated Filer | ||
Document Fiscal Year Focus | 2,015 | ||
Document Fiscal Period Focus | Q3 | ||
Document Type | 10-Q | ||
Amendment Flag | false | ||
Document Period End Date | Sep. 30, 2015 | ||
Entity Common Stock, Shares Outstanding | 33,018,206 | ||
Subsequent Event [Member] | |||
Entity Information [Line Items] | |||
Preferred Units, Outstanding | 30,158,619 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
Current assets: | ||
Cash and cash equivalents | $ 1,136 | $ 2,661 |
Accounts receivable, net of allowance for doubtful accounts of $222 and $57 at December 31, 2014 and September 30, 2015, respectively | 10,084 | 9,051 |
Receivables from related parties, net of allowance for doubtful accounts of $225 at both dates | 2,696 | 2,316 |
Prepaid insurance | 2,602 | 1,582 |
Investments | 0 | 2,079 |
Other current assets | 3,943 | 3,805 |
Total current assets | 20,461 | 21,494 |
Property, plant and equipment, net of accumulated depreciation of $192,440 and $209,545 at December 31, 2014 and September 30, 2015, respectively | 326,435 | 310,163 |
Investment in unconsolidated affiliate | 19,684 | 20,381 |
Goodwill | 10,727 | 7,216 |
Debt issuance costs, net | 2,430 | 3,085 |
Intangibles and other assets, net | 3,293 | 2,056 |
Total assets | 383,030 | 364,395 |
Current liabilities: | ||
Accounts payable | 10,298 | 7,626 |
Accrued interest payable | 192 | 233 |
Accrued property taxes payable | 3,314 | 2,046 |
Unearned revenue | 4,470 | 1,531 |
Unearned revenue with related parties | 98 | 909 |
Accrued payroll | 6,266 | 6,520 |
Other current liabilities | 3,295 | 3,204 |
Total current liabilities | 27,933 | 22,069 |
Unearned revenue with related parties, noncurrent | 89 | 116 |
Other long-term liabilities | 3,728 | 3,620 |
Interest rate swaps liability | 5,269 | 2,634 |
Long-term debt | $ 232,000 | $ 216,000 |
Commitments and contingencies (Note 12) | ||
Partners’ capital: | ||
Series A Preferred Units (30,158,619 units issued and outstanding for both dates) | $ 204,599 | $ 204,599 |
Common unitholders (32,774,163 and 33,018,206 units issued and outstanding at December 31, 2014 and September 30, 2015, respectively) | 520,053 | 525,767 |
General partner interest (1.8% interest with 1,127,755 general partner units outstanding at both dates) | (610,641) | (610,410) |
Total Partners’ capital | 114,011 | 119,956 |
Total liabilities and Partners’ capital | $ 383,030 | $ 364,395 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
Current assets: | ||
Accounts receivable, allowance for doubtful accounts | $ 57 | $ 222 |
Receivables from related parties, allowance for doubtful accounts | 225 | 225 |
Accumulated Depreciation, property plant and equipment | $ 209,545 | $ 192,440 |
Partners’ capital: | ||
Series A Preferred unitholders, units issued | 30,158,619 | 30,158,619 |
Preferred Units, Outstanding | 30,158,619 | 30,158,619 |
Common unitholders, units issued | 33,018,206 | 32,774,163 |
Common unitholders, units outstanding | 33,018,206 | 32,774,163 |
General partner interest, units outstanding | 1,127,755 | 1,127,755 |
General partner percentage interest | 1.80% | 1.80% |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Service revenue: | ||||
Third party revenue | $ 36,360 | $ 38,501 | $ 104,872 | $ 107,935 |
Related party revenue | 10,857 | 9,857 | 31,275 | 32,663 |
Total revenue | 47,217 | 48,358 | 136,147 | 140,598 |
Expense: | ||||
Operating | 31,678 | 32,295 | 97,446 | 102,272 |
General and administrative | 4,742 | 4,267 | 14,386 | 13,124 |
Total expense | 36,420 | 36,562 | 111,832 | 115,396 |
Gain on sale of assets | 6,213 | 808 | 6,477 | 1,780 |
Operating income | 17,010 | 12,604 | 30,792 | 26,982 |
Other income (expense): | ||||
Equity earnings in unconsolidated affiliate | 1,399 | 423 | 3,338 | 477 |
Interest expense (net of capitalized interest of $84, $80, $244, and $153, respectively) | (4,343) | (1,640) | (10,576) | (8,325) |
Income before income taxes | 14,066 | 11,387 | 23,554 | 19,134 |
Provision for income taxes | 99 | 116 | 296 | 351 |
Net income | 13,967 | 11,271 | 23,258 | 18,783 |
Allocation of net income for calculation of earnings per unit: | ||||
General partner interest in net income | 376 | 247 | 720 | 437 |
Preferred interest in net income | 5,391 | 5,391 | 16,173 | 16,173 |
Income available to limited partners | $ 8,200 | $ 5,633 | $ 6,365 | $ 2,173 |
Basic net income per common unit | $ 0.24 | $ 0.23 | $ 0.19 | $ 0.09 |
Diluted net income per common unit | $ 0.21 | $ 0.20 | $ 0.19 | $ 0.09 |
Weighted average common units outstanding - basic | 32,947 | 23,909 | 32,919 | 23,245 |
Weighted average common units outstanding - diluted | 63,875 | 54,927 | 32,919 | 23,245 |
CONSOLIDATED STATEMENTS OF OPE5
CONSOLIDATED STATEMENTS OF OPERATIONS CONSOLIDATED STATEMENT OF OPERATIONS (Parenthetical) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Income Statement [Abstract] | ||||
Capitalized interest | $ 0.1 | $ 0.1 | $ 0.2 | $ 0.2 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN PARTNERS' CAPITAL - 9 months ended Sep. 30, 2015 - USD ($) $ in Thousands | Total | Common Unitholders [Member] | Preferred Partner [Member] | General Partner Interest [Member] |
Balance at Dec. 31, 2014 | $ 119,956 | $ 525,767 | $ 204,599 | $ (610,410) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Net income | 23,258 | 6,677 | 16,173 | 408 |
Equity-based incentive compensation | 1,459 | 1,434 | 25 | |
Profits interest contribution | 112 | 112 | ||
Distributions | (30,960) | (14,011) | (16,173) | (776) |
Proceeds from Issuance or Sale of Equity | 186 | 186 | ||
Balance at Sep. 30, 2015 | $ 114,011 | $ 520,053 | $ 204,599 | $ (610,641) |
CONSOLIDATED STATEMENTS OF CHA7
CONSOLIDATED STATEMENTS OF CHANGES IN PARTNERS' CAPITAL CONSOLIDATED STATEMENTS OF CHANGES IN PARTNERS' CAPITAL (PARENTHETICAL) - shares | Sep. 25, 2015 | Sep. 22, 2014 |
Changes in Partners Capital [Abstract] | ||
Limited Partners' Capital Account, Units Issued | 30,075 | 9,775,000 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 9 Months Ended | |
Sep. 30, 2015 | Sep. 30, 2014 | |
Cash flows from operating activities: | ||
Net income | $ 23,258,000 | $ 18,783,000 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Provision for uncollectible receivables from third parties | (166,000) | 153,000 |
Provision for uncollectible receivables from related parties | 0 | 171,000 |
Depreciation and amortization | 20,141,000 | 19,342,000 |
Amortization of Financing Costs | 655,000 | 603,000 |
Unrealized loss related to interest rate swaps | 2,635,000 | 930,000 |
Gain on sale of assets | 6,477,000 | 1,780,000 |
Equity-based incentive compensation | 1,459,000 | 848,000 |
Equity earnings in unconsolidated affiliate | 3,338,000 | 477,000 |
Distributions from unconsolidated affiliate | 3,719,000 | 0 |
Gain related to investments | (267,000) | 0 |
Changes in assets and liabilities | ||
Increase in accounts receivable | (867,000) | (712,000) |
Increase in receivables from related parties | (380,000) | (140,000) |
Decrease in prepaid insurance | 2,419,000 | 1,969,000 |
Decrease (increase) in other current assets | (138,000) | 467,000 |
Decrease (increase) in other assets | (1,262,000) | 128,000 |
Decrease in accounts payable | (351,000) | (503,000) |
Decrease in accrued interest payable | (41,000) | (307,000) |
Increase in accrued property taxes | 1,268,000 | 1,054,000 |
Increase in unearned revenue | 3,146,000 | 1,346,000 |
Increase (decrease) in unearned revenue from related parties | (838,000) | 122,000 |
Decrease in accrued payroll | (254,000) | (913,000) |
Decrease in other accrued liabilities | (1,127,000) | (1,765,000) |
Net cash provided by operating activities | 43,194,000 | 39,319,000 |
Cash flows from investing activities: | ||
Payments to Acquire Businesses, Gross | (13,895,000) | 0 |
Capital expenditures | (30,044,000) | (25,372,000) |
Proceeds from sale of assets | 13,540,000 | 1,982,000 |
Distributions from unconsolidated affiliate | 316,000 | 0 |
Proceeds from sale of investments | 2,346,000 | 0 |
Net cash used in investing activities | (27,737,000) | (23,390,000) |
Cash flows from financing activities: | ||
Payment on insurance premium financing agreement | (2,320,000) | (1,875,000) |
Debt issuance costs | 0 | (326,000) |
Borrowings under credit facility | 88,000,000 | 42,733,000 |
Payments under credit facility | (72,000,000) | (103,733,000) |
Proceeds from Issuance or Sale of Equity | 186,000 | 71,193,000 |
Capital contribution related to profits interest | 112,000 | 112,000 |
Distributions | (30,960,000) | (25,853,000) |
Net cash used in financing activities | (16,982,000) | (17,749,000) |
Net decrease in cash and cash equivalents | (1,525,000) | (1,820,000) |
Cash and cash equivalents at beginning of period | 2,661,000 | 3,182,000 |
Cash and cash equivalents at end of period | 1,136,000 | 1,362,000 |
Supplemental disclosure of cash flow information: | ||
Increase in accounts payable related to purchase of property, plant and equipment | 3,023,000 | 2,055,000 |
Increase in accrued liabilities related to insurance premium financing agreement | $ 3,439,000 | $ 2,494,000 |
ORGANIZATION AND NATURE OF BUSI
ORGANIZATION AND NATURE OF BUSINESS | 9 Months Ended |
Sep. 30, 2015 | |
ORGANIZATION AND NATURE OF BUSINESS [Abstract] | |
ORGANIZATION AND NATURE OF BUSINESS | ORGANIZATION AND NATURE OF BUSINESS Blueknight Energy Partners, L.P. and subsidiaries (collectively, the “Partnership”) is a publicly traded master limited partnership with operations in twenty-three states. The Partnership provides integrated terminalling, storage, processing, gathering and transportation services for companies engaged in the production, distribution and marketing of crude oil and asphalt products. The Partnership manages its operations through four operating segments: (i) asphalt services, (ii) crude oil terminalling and storage services, (iii) crude oil pipeline services and (iv) crude oil trucking and producer field services. The Partnership’s common units and preferred units, which represent limited partnership interests in the Partnership, are listed on the NASDAQ Global Market under the symbols “BKEP” and “BKEPP,” respectively. The Partnership was formed in February 2007 as a Delaware master limited partnership initially to own, operate and develop a diversified portfolio of complementary midstream energy assets. |
BASIS OF CONSOLIDATION AND PRES
BASIS OF CONSOLIDATION AND PRESENTATION | 9 Months Ended |
Sep. 30, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
BASIS OF CONSOLIDATION AND PRESENTATION | BASIS OF CONSOLIDATION AND PRESENTATION The financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). The condensed consolidated statements of operations for the three and nine months ended September 30, 2014 and 2015 , the condensed consolidated statement of changes in partners’ capital for the nine months ended September 30, 2015 , the condensed consolidated statements of cash flows for the nine months ended September 30, 2014 and 2015 , and the condensed consolidated balance sheet as of September 30, 2015 are unaudited. In the opinion of management, the unaudited consolidated financial statements have been prepared on the same basis as the audited financial statements and include all adjustments necessary to state fairly the financial position and results of operations for the respective interim periods. All adjustments are of a recurring nature unless otherwise disclosed herein. The 2014 year-end condensed consolidated balance sheet data was derived from audited financial statements but does not include all disclosures required by GAAP. These unaudited condensed consolidated financial statements and notes should be read in conjunction with the consolidated financial statements and notes thereto included in the Partnership’s annual report on Form 10-K for the year ended December 31, 2014 filed with the Securities and Exchange Commission (the “SEC”) on March 11, 2015 (the “2014 Form 10-K”). Interim financial results are not necessarily indicative of the results to be expected for an annual period. The Partnership’s significant accounting policies are consistent with those disclosed in Note 4 of the Notes to Consolidated Financial Statements in its 2014 Form 10-K. The Partnership’s investment in Advantage Pipeline, L.L.C. (“Advantage Pipeline”), over which the Partnership has significant influence but not control, is accounted for by the equity method. The Partnership does not consolidate any part of the assets or liabilities of its equity investee. The Partnership’s share of net income or loss is reflected as one line item on the Partnership’s unaudited condensed consolidated statements of operations entitled “Equity earnings in unconsolidated affiliate” and will increase or decrease, as applicable, the carrying value of the Partnership’s investment in the unconsolidated affiliate on the unaudited condensed consolidated balance sheets. Distributions to the Partnership reduce the carrying value of its investment and are reflected in the Partnership’s unaudited condensed consolidated statements of cash flows in the line item “Distributions from unconsolidated affiliate.” In turn, contributions will increase the carrying value of the Partnership’s investment and will be reflected in the Partnership’s unaudited condensed consolidated statements of cash flows in investing activities. |
PROPERTY, PLANT AND EQUIPMENT
PROPERTY, PLANT AND EQUIPMENT | 9 Months Ended |
Sep. 30, 2015 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY, PLANT AND EQUIPMENT | PROPERTY, PLANT AND EQUIPMENT Estimated Useful Lives (Years) December 31, 2014 September 30, 2015 (dollars in thousands) Land N/A $ 18,292 $ 19,637 Land improvements 10-20 6,398 6,473 Pipelines and facilities 5-30 168,537 179,585 Storage and terminal facilities 10-35 240,004 253,391 Transportation equipment 3-10 13,557 12,531 Office property and equipment and other 3-20 28,958 29,296 Pipeline linefill and tank bottoms N/A 10,186 3,886 Construction-in-progress N/A 16,671 31,181 Property, plant and equipment, gross 502,603 535,980 Accumulated depreciation (192,440 ) (209,545 ) Property, plant and equipment, net $ 310,163 $ 326,435 Depreciation expense for the three months ended September 30, 2014 and 2015 was $6.6 million and $6.7 million , respectively, and depreciation expense for the nine months ended September 30, 2014 and 2015 was $19.3 million and $20.1 million , respectively. |
DEBT
DEBT | 9 Months Ended |
Sep. 30, 2015 | |
Debt Disclosure [Abstract] | |
DEBT | DEBT On June 28, 2013, the Partnership entered into an amended and restated credit agreement that consists of a $400.0 million revolving loan facility. On September 15, 2014, the Partnership amended its credit facility to, among other things, amend the maximum permitted consolidated total leverage ratio as discussed below and to increase the limit on material project adjustments to EBITDA (as defined in the credit agreement). As of October 29, 2015 , approximately $235.0 million of revolver borrowings and $1.3 million of letters of credit were outstanding under the credit facility, leaving the Partnership with approximately $163.7 million available capacity for additional revolver borrowings and letters of credit under the credit facility, although the Partnership’s ability to borrow such funds may be limited by the financial covenants in the credit facility. The proceeds of loans made under the amended and restated credit agreement may be used for working capital and other general corporate purposes of the Partnership. All references herein to the credit agreement on or after June 28, 2013 refer to the amended and restated credit agreement, as amended on September 15, 2014. The credit agreement is guaranteed by all of the Partnership’s existing subsidiaries. Obligations under the credit agreement are secured by first priority liens on substantially all of the Partnership’s assets and those of the guarantors. The credit agreement includes procedures for additional financial institutions to become revolving lenders, or for any existing lender to increase its revolving commitment thereunder, subject to an aggregate maximum of $500.0 million for all revolving loan commitments under the credit agreement. The credit agreement will mature on June 28, 2018 , and all amounts outstanding under the credit agreement will become due and payable on such date. The Partnership may prepay all loans under the credit agreement at any time without premium or penalty (other than customary LIBOR breakage costs), subject to certain notice requirements. The credit agreement requires mandatory prepayments of amounts outstanding thereunder with the net proceeds of certain asset sales, property or casualty insurance claims, and condemnation proceedings, unless the Partnership reinvests such proceeds in accordance with the credit agreement, but these mandatory prepayments will not require any reduction of the lenders’ commitments under the credit agreement. Borrowings under the credit agreement bear interest, at the Partnership’s option, at either the reserve-adjusted eurodollar rate (as defined in the credit agreement) plus an applicable margin that ranges from 2.0% to 3.0% or the alternate base rate (the highest of the agent bank’s prime rate, the federal funds effective rate plus 0.5% , and the 30-day eurodollar rate plus 1.0% ) plus an applicable margin that ranges from 1.0% to 2.0% . The Partnership pays a per annum fee on all letters of credit issued under the credit agreement, which fee equals the applicable margin for loans accruing interest based on the eurodollar rate, and the Partnership pays a commitment fee ranging from 0.375% to 0.5% on the unused commitments under the credit agreement. The applicable margins for the Partnership’s interest rate, the letter of credit fee and the commitment fee vary quarterly based on the Partnership’s consolidated total leverage ratio (as defined in the credit agreement, being generally computed as the ratio of consolidated total debt to consolidated earnings before interest, taxes, depreciation, amortization and certain other non-cash charges). The credit agreement includes financial covenants that are tested on a quarterly basis, based on the rolling four-quarter period that ends on the last day of each fiscal quarter. Prior to the date on which the Partnership issues qualified senior notes in an aggregate principal amount (when combined with all other qualified senior notes previously or concurrently issued) that equals or exceeds $200.0 million , the maximum permitted consolidated total leverage ratio is 4.50 to 1.00; provided that: • after the Partnership delivers the Knight Warrior Pipeline Initiation Certificate (as defined in the credit agreement, but generally meaning that the Partnership has spent at least $15.0 million of the projected capital expenditures for its Knight Warrior pipeline project), the maximum permitted consolidated total leverage ratio is 5.00 to 1.00 for the fiscal quarters ending March 31, 2015 through September 30, 2016, 4.75 to 1.00 for the fiscal quarter ending December 31, 2016, and 4.50 to 1.00 for each fiscal quarter thereafter; • after the Partnership delivers the Knight Warrior Pipeline Leverage Election Certificate (as defined in the credit agreement, but generally meaning that the Partnership has spent at least 50% of the projected capital expenditures for the Knight Warrior pipeline project), the Partnership may elect to increase the maximum permitted consolidated total leverage ratio to 5.50 to 1.00 for two consecutive fiscal quarters ending on or before September 30, 2016; and • if the Partnership makes a specified acquisition (as defined in the credit agreement, but generally being an acquisition with consideration in excess of $10.0 million ), the Partnership may elect to increase the maximum permitted consolidated total leverage ratio to 5.00 to 1.00 from and after the last day of the fiscal quarter immediately preceding the fiscal quarter in which such acquisition occurs to and including the last day of the second full fiscal quarter following the fiscal quarter in which such acquisition occurred. From and after the date on which the Partnership issues qualified senior notes in an aggregate principal amount (when combined with all other qualified senior notes previously or concurrently issued) that equals or exceeds $200.0 million , the maximum permitted consolidated total leverage ratio is 5.00 to 1.00; provided that after the Partnership delivers the Knight Warrior Pipeline Initiation Certificate, the maximum permitted consolidated total leverage ratio is 5.50 to 1.00 for the fiscal quarters ending March 31, 2015 through September 30, 2016, and 5.00 to 1.00 for each fiscal quarter thereafter. The Partnership delivered the Knight Warrior Initiation Certificate in August 2015. The maximum permitted consolidated senior secured leverage ratio (as defined in the credit agreement, but generally computed as the ratio of consolidated total secured debt to consolidated earnings before interest, taxes, depreciation, amortization and certain other non-cash charges) is 3.50 to 1.00, but this covenant is only tested from and after the date on which the Partnership issues qualified senior notes in an aggregate principal amount (when combined with all other qualified senior notes previously or concurrently issued) that equals or exceeds $200.0 million . The minimum permitted consolidated interest coverage ratio (as defined in the credit agreement, but generally computed as the ratio of consolidated earnings before interest, taxes, depreciation, amortization and certain other non-cash charges to consolidated interest expense) is 2.50 to 1.00. In addition, the credit agreement contains various covenants that, among other restrictions, limit the Partnership’s ability to: • create, issue, incur or assume indebtedness; • create, incur or assume liens; • engage in mergers or acquisitions; • sell, transfer, assign or convey assets; • repurchase the Partnership’s equity, make distributions to unitholders and make certain other restricted payments; • make investments; • modify the terms of certain indebtedness, or prepay certain indebtedness; • engage in transactions with affiliates; • enter into certain hedging contracts; • enter into certain burdensome agreements; • change the nature of the Partnership’s business; • enter into operating leases; and • make certain amendments to the Partnership’s partnership agreement. At September 30, 2015 , the Partnership’s consolidated total leverage ratio was 3.40 to 1.00 and the consolidated interest coverage ratio was 7.20 to 1.00. The Partnership was in compliance with all covenants of its credit agreement as of September 30, 2015 . The credit agreement permits the Partnership to make quarterly distributions of available cash (as defined in the Partnership’s partnership agreement) to unitholders so long as no default or event of default exists under the credit agreement on a pro forma basis after giving effect to such distribution. The Partnership is currently allowed to make distributions to its unitholders in accordance with this covenant; however, the Partnership will only make distributions to the extent it has sufficient cash from operations after establishment of cash reserves as determined by the Board of Directors (the “Board”) of Blueknight Energy Partners G.P., L.L.C. (the “General Partner”) in accordance with the Partnership’s cash distribution policy, including the establishment of any reserves for the proper conduct of the Partnership’s business. See Note 6 for additional information regarding distributions. In addition to other customary events of default, the Credit Agreement includes an event of default if (i) the General Partner ceases to own 100% of the Partnership’s general partner interest or ceases to control the Partnership or (ii) Vitol Holding B.V. (together with its affiliates, “Vitol”) and Charlesbank Capital Partners, LLC cease to collectively own and control 50.0% or more of the membership interests of the General Partner. If an event of default relating to bankruptcy or other insolvency events occurs with respect to the General Partner or the Partnership, all indebtedness under the credit agreement will immediately become due and payable. If any other event of default exists under the credit agreement, the lenders may accelerate the maturity of the obligations outstanding under the credit agreement and exercise other rights and remedies. In addition, if any event of default exists under the credit agreement, the lenders may commence foreclosure or other actions against the collateral. If any default occurs under the credit agreement, or if the Partnership is unable to make any of the representations and warranties in the credit agreement, the Partnership will be unable to borrow funds or have letters of credit issued under the credit agreement. The Partnership capitalized $0.3 million in debt issuance costs for the three and nine months ended September 30, 2014. The Partnership capitalized no debt issuance costs for the three and nine months ended September 30, 2015 . Debt issuance costs are being amortized over the term of the amended and restated credit agreement. Interest expense related to debt issuance cost amortization for each of the three months ended September 30, 2014 and 2015 was $0.2 million . Interest expense related to debt issuance cost amortization for the nine months ended September 30, 2014 and 2015 was $0.6 million and $0.7 million , respectively. During the three months ended September 30, 2014 and 2015 , the weighted average interest rate under the Partnership’s credit agreement was 3.41% and 3.31% , respectively, resulting in interest expense of approximately $2.5 million and $2.0 million , respectively. During the nine months ended September 30, 2014 and 2015 , the weighted average interest rate under the Partnership’s credit agreement was 3.41% and 3.37% , respectively, resulting in interest expense of approximately $7.3 million and $5.9 million , respectively. As of September 30, 2015 , borrowings under the Partnership’s amended and restated credit agreement bore interest at a weighted average interest rate of 3.33% . During each of the three months ended September 30, 2014 and 2015 , the Partnership capitalized interest of less than $0.1 million . During each of the nine months ended September 30, 2014 and 2015 , the Partnership capitalized interest of $0.2 million . The Partnership is exposed to market risk for changes in interest rates related to its credit facility. Interest rate swap agreements are used to manage a portion of the exposure related to changing interest rates by converting floating-rate debt to fixed-rate debt. In March 2014, the Partnership entered into two interest rate swap agreements with an aggregate notional amount of $200.0 million . The first agreement has a notional amount of $100.0 million , became effective June 28, 2014, and matures on June 28, 2018. Under the terms of the first interest rate swap agreement, the Partnership pays a fixed rate of 1.45% and receives one-month LIBOR with monthly settlement. The second agreement has a notional amount of $100.0 million , became effective January 28, 2015, and matures on January 28, 2019. Under the terms of the second interest rate swap agreement, the Partnership pays a fixed rate of 1.97% and receives one-month LIBOR with monthly settlement. During the three and nine months ended September 30, 2015 , the Partnership recorded swap interest expense of $0.8 million and $2.2 million , respectively. The Partnership had $0.3 million swap interest expense during each of the three and nine months ended September 30, 2014 . The fair market value of the interest rate swaps at December 31, 2014 and September 30, 2015 is a liability of $2.6 million and $5.3 million , respectively, and is recorded in long-term interest rate swap liabilities on the condensed consolidated balance sheets. The interest rate swaps do not receive hedge accounting treatment under ASC 815 - Derivatives and Hedging . Changes in the fair value of the interest rate swaps are recorded in interest expense in the unaudited condensed consolidated statements of operations. |
NET INCOME PER LIMITED PARTNER
NET INCOME PER LIMITED PARTNER UNIT | 9 Months Ended |
Sep. 30, 2015 | |
Earnings Per Share [Abstract] | |
NET INCOME PER LIMITED PARTNER UNIT | NET INCOME PER LIMITED PARTNER UNIT For purposes of calculating earnings per unit, the excess of distributions over earnings or excess of earnings over distributions for each period are allocated to the Partnership’s general partner based on the general partner’s ownership interest at the time. The following sets forth the computation of basic and diluted net income per common unit (in thousands, except per unit data): Three Months ended September 30, Nine Months ended September 30, 2014 2015 2014 2015 Net income $ 11,271 $ 13,967 $ 18,783 $ 23,258 General partner interest in net income 247 376 437 720 Preferred interest in net income 5,391 5,391 16,173 16,173 Income available to limited partners $ 5,633 $ 8,200 $ 2,173 $ 6,365 Basic weighted average number of units: Common units 23,909 32,947 23,245 32,919 Restricted and phantom units 725 721 659 675 Diluted weighted average number of units: Common units 54,927 63,875 23,245 32,919 Basic net income per common unit $ 0.23 $ 0.24 $ 0.09 $ 0.19 Diluted net income per common unit $ 0.20 $ 0.21 $ 0.09 $ 0.19 |
PARTNERS' CAPITAL AND DISTRIBUT
PARTNERS' CAPITAL AND DISTRIBUTIONS | 9 Months Ended |
Sep. 30, 2015 | |
Partners' Capital Account, Distributions [Abstract] | |
PARTNERS' CAPITAL AND DISTRIBUTIONS | PARTNERS’ CAPITAL AND DISTRIBUTIONS On September 22, 2014, the Partnership issued and sold 9,775,000 common units for a public offering price of $7.61 per unit, resulting in proceeds of approximately $71.2 million , net of underwriters’ discount and offering expenses of $3.2 million . On October 22, 2015 , the Board approved a distribution of $0.17875 per preferred unit, or a total distribution of $5.4 million , for the quarter ending September 30, 2015 . The Partnership will pay this distribution on the preferred units on November 13, 2015 to unitholders of record as of November 3, 2015 . In addition, on October 22, 2015 , the Board declared a cash distribution of $0.1450 per unit on its outstanding common units. The distribution will be paid on November 13, 2015 to unitholders of record on November 3, 2015 . The distribution is for the three months ended September 30, 2015 . The total distribution will be approximately $5.2 million , with approximately $4.8 million and $0.3 million to be paid to the Partnership’s common unitholders and general partner, respectively, and $0.1 million to be paid to holders of phantom and restricted units pursuant to awards granted under the Partnership’s long-term incentive plan. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 9 Months Ended |
Sep. 30, 2015 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | RELATED PARTY TRANSACTIONS The Partnership provides crude oil gathering, transportation, terminalling and storage services to Vitol as well as certain operating, strategic assessment, economic evaluation and project design services. For the three months ended September 30, 2014 and 2015 , the Partnership recognized revenues of $9.6 million and $10.5 million , respectively, for services provided to Vitol. For the nine months ended September 30, 2014 and 2015 , the Partnership recognized revenues of $31.9 million and $30.3 million , respectively, for services provided to Vitol. As of December 31, 2014 and September 30, 2015 , the Partnership had receivables from Vitol of $2.3 million and $2.6 million , net of allowance for doubtful accounts. As of December 31, 2014 and September 30, 2015 , the Partnership had unearned revenues from Vitol of $1.0 million and $0.2 million , respectively. The Partnership also provides operating and administrative services to Advantage Pipeline. For the three months ended September 30, 2014 and 2015 , the Partnership earned revenues of $0.3 million and $0.4 million , respectively, for services provided to Advantage Pipeline. For the nine months ended September 30, 2014 and 2015 , the Partnership earned revenues of $0.7 million and $1.0 million , respectively, for services provided to Advantage Pipeline. As of December 31, 2014 , the Partnership had receivables from Advantage Pipeline of less than $0.1 million . As of September 30, 2015 , the Partnership had receivables from Advantage Pipeline of $0.1 million . |
LONG-TERM INCENTIVE PLAN
LONG-TERM INCENTIVE PLAN | 9 Months Ended |
Sep. 30, 2015 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
LONG-TERM INCENTIVE PLAN | LONG-TERM INCENTIVE PLAN In July 2007, the General Partner adopted the Long-Term Incentive Plan (the “LTIP”). The compensation committee of the Board administers the LTIP. Effective April 29, 2014, the Partnership’s unitholders approved an amendment to the LTIP to increase the number of common units reserved for issuance under the incentive plan by 1,500,000 common units from 2,600,000 common units to 4,100,000 common units. The common units are deliverable upon vesting. Although other types of awards are contemplated under the LTIP, currently outstanding awards include “phantom” units, which convey the right to receive common units upon vesting, and “restricted” units, which are grants of common units restricted until the time of vesting. Certain of the phantom unit awards also include distribution equivalent rights (“DERs”). Subject to applicable earning criteria, a DER entitles the grantee to a cash payment equal to the cash distribution paid on an outstanding common unit prior to the vesting date of the underlying award. Recipients of restricted units are entitled to receive cash distributions paid on common units during the vesting period which distributions are reflected initially as a reduction of partners’ capital. Distributions paid on units which ultimately do not vest are reclassified as compensation expense. Awards granted to date are equity awards under ASC 718 - Stock Compensation and, accordingly, the fair value of the awards as of the grant date is expensed over the vesting period. In each of December 2012, 2013 and 2014, 7,500 restricted common units were granted which vest in one-third increments over three years. These grants were made in connection with the anniversary of the independent directors joining the Board. The grant date fair value of the restricted units for the 2012 and 2014 grants was less than $0.1 million while the grant date fair value of the restricted units for the 2013 grant was $0.1 million . In March 2013 , 2014 and 2015 , grants for 251,106 , 276,773 and 266,076 phantom units, respectively, were made, which vest on January 1, 2016 , January 1, 2017 and January 1, 2018 , respectively. These grants are equity awards under ASC 718 – Stock Compensation, and, accordingly, the fair value of the awards as of the grant date is expensed over the vesting period. The weighted average grant date fair-value of the awards is $8.75 , $9.06 and $7.74 per unit, respectively, which is the closing market price on the grant date of the awards. The value of these award grants was approximately $2.2 million , $2.5 million and $2.1 million respectively, on their grant date. The unrecognized estimated compensation cost of outstanding phantom units at September 30, 2015 was $2.7 million , which will be recognized over the remaining vesting period. In September 2012 , Mr. Mark Hurley was granted 500,000 phantom units under the LTIP upon his employment as the Chief Executive Officer of the General Partner. These grants are equity awards under ASC 718 – Stock Compensation, and, accordingly, the fair value of the awards as of the grant date is expensed over the vesting period. These units vest ratably over five years pursuant to the Employee Phantom Unit Agreement between Mr. Hurley and the General Partner and do not include DERs. The weighted average grant date fair value for the units of $5.62 was determined based on the closing market price of the Partnership’s common units on the grant date of the award, less the present value of the estimated distributions to be paid to holders of an outstanding common unit prior to the vesting of the underlying award. The value of this award grant was approximately $2.8 million on the grant date, and the unrecognized estimated compensation cost at September 30, 2015 was $1.1 million and will be expensed over the remaining vesting period. The Partnership’s equity-based incentive compensation expense for the three months ended September 30, 2014 and 2015 was $0.6 million and $0.7 million , respectively. The Partnership’s equity-based incentive compensation expense for the nine months ended September 30, 2014 and 2015 was $1.6 million and $1.9 million , respectively. Activity pertaining to phantom common units and restricted common unit awards granted under the Plan is as follows: Number of Units Weighted Average Grant Date Fair Value Nonvested at December 31, 2014 1,020,264 $ 7.46 Granted 266,076 7.74 Vested 322,800 6.41 Forfeited 46,095 8.65 Nonvested at September 30, 2015 917,445 $ 7.85 |
EMPLOYEE BENEFIT PLAN
EMPLOYEE BENEFIT PLAN | 9 Months Ended |
Sep. 30, 2015 | |
Compensation and Retirement Disclosure [Abstract] | |
EMPLOYEE BENEFIT PLAN | EMPLOYEE BENEFIT PLANS Under the Partnership’s 401(k) Plan, which was instituted in 2009 , employees who meet specified service requirements may contribute a percentage of their total compensation, up to a specified maximum, to the 401(k) Plan. The Partnership may match each employee’s contribution, up to a specified maximum, in full or on a partial basis. The Partnership recognized expense of $0.4 million for each of the three months ended September 30, 2014 and 2015 for discretionary contributions under the 401(k) Plan. The Partnership recognized expense of $1.1 million and $1.2 million , respectively, for the nine months ended September 30, 2014 and 2015 for discretionary contributions under the 401(k) Plan. The Partnership may also make annual lump-sum contributions to the 401(k) Plan irrespective of the employee’s contribution match. The Partnership may make a discretionary annual contribution in the form of profit sharing calculated as a percentage of an employee’s eligible compensation. This contribution is retirement income under the qualified 401(k) Plan. Annual profit sharing contributions to the 401(k) Plan are submitted to and approved by the Board. The Partnership recognized expense of $0.2 million and $0.3 million for the three months ended September 30, 2014 and 2015 , respectively, for discretionary profit sharing contributions under the 401(k) Plan. The Partnership recognized expense of $ 0.5 million and $0.6 million , respectively, for the nine months ended September 30, 2014 and 2015 for discretionary profit sharing contributions under the 401(k) Plan. Under the Partnership’s Employee Unit Purchase Plan (the “Unit Purchase Plan”), which was instituted in January 2015, employees have the opportunity to acquire or increase their ownership of common units representing limited partner interests in the Partnership. Eligible employees who enroll in the Unit Purchase Plan may elect to have a designated whole percentage, up to a specified maximum, of their eligible compensation for each pay period withheld for the purchase of common units at a discount to the then current market value. A maximum of 1,000,000 common units may be delivered under the Unit Purchase Plan, subject to adjustment for a recapitalization, split, reorganization or similar event pursuant to the terms of the Unit Purchase Plan. The Partnership recognized compensation expense of less than $0.1 million for the three months ended September 30, 2015 , and $0.1 million for the nine months ended September 30, 2015 , in connection with the Unit Purchase Plan. |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 9 Months Ended |
Sep. 30, 2015 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENTS | FAIR VALUE MEASUREMENTS The Partnership utilizes a three-tier framework for assets and liabilities required to be measured at fair value. In addition, the Partnership uses valuation techniques, such as the market approach (comparable market prices), the income approach (present value of future income or cash flow), and the cost approach (cost to replace the service capacity of an asset or replacement cost) to value these assets and liabilities as appropriate. The Partnership uses an exit price when determining the fair value. The exit price represents amounts that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. The Partnership utilizes a three-tier fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three broad levels. The following is a brief description of those three levels: Level 1 Observable inputs such as quoted prices (unadjusted) in active markets for identical assets or liabilities. Level 2 Inputs other than quoted prices that are observable for these assets or liabilities, either directly or indirectly. These include quoted prices for similar assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active. Level 3 Unobservable inputs in which there is little market data, which requires the reporting entity to develop its own assumptions. This hierarchy requires the use of observable market data, when available, to minimize the use of unobservable inputs when determining fair value. In periods in which they occur, the Partnership recognizes transfers into and out of Level 3 as of the end of the reporting period. Transfers out of Level 3 represent existing assets and liabilities that were classified previously as Level 3 for which the observable inputs became a more significant portion of the fair value estimates. Determining the appropriate classification of the Partnership’s fair value measurements within the fair value hierarchy requires management’s judgment regarding the degree to which market data is observable or corroborated by observable market data. The Partnership’s recurring financial assets and liabilities subject to fair value measurements and the necessary disclosures are as follows (in thousands): Fair Value Measurements as of December 31, 2014 Description Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Liabilities: Interest rate swap liabilities $ 2,634 $ — $ 2,634 $ — Total $ 2,634 $ — $ 2,634 $ — Fair Value Measurements as of September 30, 2015 Description Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Liabilities: Interest rate swap liabilities $ 5,269 $ — $ 5,269 $ — Total $ 5,269 $ — $ 5,269 $ — Fair Value of Other Financial Instruments The following disclosure of the estimated fair value of financial instruments is made in accordance with accounting guidance for financial instruments. The Partnership has determined the estimated fair values by using available market information and valuation methodologies. Considerable judgment is required in interpreting market data to develop the estimates of fair value. The use of different market assumptions or valuation methodologies may have a material effect on the estimated fair value amounts. At September 30, 2015 , the carrying values on the unaudited condensed consolidated balance sheets for cash and cash equivalents (classified as Level 1), accounts receivable and accounts payable approximate their fair value because of their short term nature. Based on the borrowing rates currently available to the Partnership for credit agreement debt with similar terms and maturities and consideration of the Partnership’s non-performance risk, long-term debt associated with the Partnership’s credit agreement at September 30, 2015 approximates its fair value. The fair value of the Partnership’s long-term debt was calculated using observable inputs (LIBOR for the risk free component) and unobservable company-specific credit spread information. As such, the Partnership considers this debt to be Level 3. |
OPERATING SEGMENTS
OPERATING SEGMENTS | 9 Months Ended |
Sep. 30, 2015 | |
Segment Reporting [Abstract] | |
OPERATING SEGMENTS | OPERATING SEGMENTS The Partnership’s operations consist of four operating segments: (i) asphalt services, (ii) crude oil terminalling and storage services, (iii) crude oil pipeline services, and (iv) crude oil trucking and producer field services. ASPHALT SERVICES —The Partnership provides asphalt product and residual fuel terminalling, storage and blending services at its 43 terminalling and storage facilities located in twenty-two states. CRUDE OIL TERMINALLING AND STORAGE SERVICES —The Partnership provides crude oil terminalling and storage services at its terminalling and storage facilities located in Oklahoma and Texas. CRUDE OIL PIPELINE SERVICES —The Partnership owns and operates three pipeline systems, the Mid-Continent system, the East Texas system and the Eagle North System, that gather crude oil purchased by its customers and transports it to refiners, to common carrier pipelines for ultimate delivery to refiners or to terminalling and storage facilities owned by the Partnership and others. The Partnership refers to its pipeline system located in Oklahoma and the Texas Panhandle as the Mid-Continent system. It refers to its second pipeline system, which is located in Texas, as the East Texas system. The Partnership refers to its third system, originating in Cushing, Oklahoma and terminating in Ardmore, Oklahoma, as the Eagle North system. CRUDE OIL TRUCKING AND PRODUCER FIELD SERVICES — The Partnership uses its owned and leased tanker trucks to gather crude oil for its customers at remote wellhead locations generally not covered by pipeline and gathering systems and to transport the crude oil to aggregation points and storage facilities located along pipeline gathering and transportation systems. Crude oil producer field services consist of a number of producer field services, ranging from gathering condensates from natural gas companies to hauling produced water to disposal wells. The Partnership’s management evaluates performance based upon segment operating margin, which includes revenues from related parties and external customers and operating expenses excluding depreciation and amortization. The non-GAAP measure of operating margin, excluding depreciation and amortization, (in the aggregate and by segment) is presented in the following table. The Partnership computes the components of operating margin by using amounts that are determined in accordance with GAAP. A reconciliation of operating margin, excluding depreciation and amortization, to income before income taxes, which is its nearest comparable GAAP financial measure, is included in the following table. The Partnership believes that investors benefit from having access to the same financial measures being utilized by management. Operating margin, excluding depreciation and amortization, is an important measure of the economic performance of the Partnership’s core operations. This measure forms the basis of the Partnership’s internal financial reporting and is used by its management in deciding how to allocate capital resources among segments. Income before income taxes, alternatively, includes expense items, such as depreciation and amortization, general and administrative expenses and interest expense, which management does not consider when evaluating the core profitability of the Partnership’s operations. The following table reflects certain financial data for each segment for the periods indicated (in thousands): Three Months ended September 30, Nine Months ended September 30, 2014 2015 2014 2015 Asphalt Services Service revenue Third party revenue $ 18,456 $ 21,307 $ 49,196 $ 54,934 Related party revenue 246 482 946 887 Total revenue for reportable segments 18,702 21,789 50,142 55,821 Operating expense (excluding depreciation and amortization) 6,627 6,308 20,115 19,067 Operating margin (excluding depreciation and amortization) 12,075 15,481 30,027 36,754 Total assets (end of period) $ 95,110 $ 101,434 $ 95,110 $ 101,434 Crude Oil Terminalling and Storage Services Service revenue Third party revenue $ 1,875 $ 3,524 $ 7,020 $ 9,721 Related party revenue 3,080 3,041 10,726 9,052 Total revenue for reportable segments 4,955 6,565 17,746 18,773 Operating expense (excluding depreciation and amortization) 1,006 1,325 2,980 4,582 Operating margin (excluding depreciation and amortization) 3,949 5,240 14,766 14,191 Total assets (end of period) $ 67,451 $ 73,628 $ 67,451 $ 73,628 Crude Oil Pipeline Services Service revenue Third party revenue $ 5,906 $ 2,594 $ 13,439 $ 11,107 Related party revenue 2,098 3,301 5,934 8,291 Total revenue for reportable segments 8,004 5,895 19,373 19,398 Operating expense (excluding depreciation and amortization) 2,484 4,855 11,600 13,589 Operating margin (excluding depreciation and amortization) 5,520 1,040 7,773 5,809 Total assets (end of period) $ 170,700 $ 192,945 $ 170,700 $ 192,945 Crude Oil Trucking and Producer Field Services Service revenue Third party revenue $ 12,264 $ 8,935 $ 38,280 $ 29,110 Related party revenue 4,433 4,033 15,057 13,045 Total revenue for reportable segments 16,697 12,968 53,337 42,155 Operating expense (excluding depreciation and amortization) 15,607 12,432 48,235 40,067 Operating margin (excluding depreciation and amortization) 1,090 536 5,102 2,088 Total assets (end of period) $ 28,208 $ 15,023 $ 28,208 $ 15,023 Total operating margin (excluding depreciation and amortization) (1) $ 22,634 $ 22,297 $ 57,668 $ 58,842 ____________________ (1) The following table reconciles segment operating margin (excluding depreciation and amortization) to income before income taxes (in thousands): Three Months ended September 30, Nine Months ended September 30, 2014 2015 2014 2015 Operating margin (excluding depreciation and amortization) $ 22,634 $ 22,297 $ 57,668 $ 58,842 Depreciation and amortization (6,571 ) (6,758 ) (19,342 ) (20,141 ) General and administrative expenses (4,267 ) (4,742 ) (13,124 ) (14,386 ) Gain on sale of assets 808 6,213 1,780 6,477 Interest expense (1,640 ) (4,343 ) (8,325 ) (10,576 ) Equity earnings in unconsolidated affiliate 423 1,399 477 3,338 Income before income taxes $ 11,387 $ 14,066 $ 19,134 $ 23,554 |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 9 Months Ended |
Sep. 30, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENT AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES The Partnership is from time to time subject to various legal actions and claims incidental to its business. Management believes that these legal proceedings will not have a material adverse effect on the financial position, results of operations or cash flows of the Partnership. Once management determines that information pertaining to a legal proceeding indicates that it is probable that a liability has been incurred and the amount of such liability can be reasonably estimated, an accrual is established equal to its estimate of the likely exposure. On October 27, 2008, Keystone Gas Company (“Keystone”) filed suit against the Partnership in Oklahoma State District Court in Creek County alleging that it is the rightful owner of certain segments of the Partnership’s pipelines and related rights of way, located in Payne and Creek Counties, that the Partnership acquired from SemGroup Corporation (“SemCorp”) in connection with the Partnership’s initial public offering in 2007. Keystone seeks to quiet title to various rights of way and pipelines and seeks damages up to the net profits derived from the disputed pipelines. There has been no determination of the extent of potential damages for the Partnership’s use of such pipelines. The Partnership has filed a counterclaim against Keystone alleging that it is wrongfully using a segment of a pipeline that is owned by the Partnership in Payne and Creek Counties. The Partnership intends to vigorously defend these claims. No trial date has been set by the court. The parties are engaged in discovery as well as settlement negotiations. The Partnership believes any settlement will not have a material adverse effect on the Partnership’s financial condition or results of operations. On February 6, 2012, the Partnership filed suit against SemCorp and others in Oklahoma County District Court. In the suit, the Partnership was seeking a judgment that SemCorp immediately return approximately 140,000 barrels of crude oil linefill belonging to the Partnership, and the Partnership was seeking judgment in an amount in excess of $75,000 for actual damages, special damages, punitive damages, pre-judgment interest, reasonable attorney’s fees and costs, and such other relief that the Court deems equitable and just. In September 2015, this lawsuit was resolved among all parties under the terms of a confidential settlement agreement in which all parties continue to expressly deny liability for any claim or counterclaim asserted against them. In connection with the settlement, the Partnership recognized a $6.0 million gain on the sale of crude oil pipeline linefill and storage tank bottoms. On February 16, 2014, a motor vehicle accident occurred involving a Partnership vehicle. Litigation has been filed. The Petition alleges injury and claims for medical bills for past and future medical treatment, as well as consequential damages, pain and discomfort, and permanent disability and injuries in an amount in excess of $75,000 . The matter has been submitted to the Partnership’s insurance carriers and they have assigned counsel to defend the case. The ultimate outcome of this matter cannot be determined at this time. On November 1, 2014, a multi-vehicular accident occurred resulting in the death of an employee of the Partnership and allegations of injuries to third parties and injury to property. Litigation has been filed by injured third parties. The matter has been submitted to the Partnership’s insurance carriers and the retentions have been reserved. The ultimate outcome of this matter cannot be determined at this time. On February 13, 2015, a multi-vehicular accident occurred resulting in injury to third parties and two employees of the Partnership as well as property damage. Litigation has been filed by injured third parties. The matter has been submitted to the Partnership’s insurance carriers and the retentions have been reserved. The ultimate outcome of this matter cannot be determined at this time. The Partnership may become the subject of additional private or government actions regarding these matters in the future. Litigation may be time-consuming, expensive and disruptive to normal business operations, and the outcome of litigation is difficult to predict. The defense of these lawsuits may result in the incurrence of significant legal expense, both directly and as the result of the Partnership’s indemnification obligations. The litigation may also divert management’s attention from the Partnership’s operations which may cause its business to suffer. An unfavorable outcome in any of these matters may have a material adverse effect on the Partnership’s business, financial condition, results of operations, cash flows, ability to make distributions to its unitholders, the trading price of the Partnership’s common units and its ability to conduct its business. All or a portion of the defense costs and any amount the Partnership may be required to pay to satisfy a judgment or settlement of these claims may or may not be covered by insurance. The Partnership has contractual obligations to perform dismantlement and removal activities in the event that some of its asphalt product and residual fuel oil terminalling and storage assets are abandoned. These obligations include varying levels of activity including completely removing the assets and returning the land to its original state. The Partnership has determined that the settlement dates related to the retirement obligations are indeterminate. The assets with indeterminate settlement dates have been in existence for many years and with regular maintenance will continue to be in service for many years to come. Also, it is not possible to predict when demands for the Partnership’s terminalling and storage services will cease, and the Partnership does not believe that such demand will cease for the foreseeable future. Accordingly, the Partnership believes the date when these assets will be abandoned is indeterminate. With no reasonably determinable abandonment date, the Partnership cannot reasonably estimate the fair value of the associated asset retirement obligations. Management believes that if the Partnership’s asset retirement obligations were settled in the foreseeable future the potential cash flows that would be required to settle the obligations based on current costs are not material. The Partnership will record asset retirement obligations for these assets in the period in which sufficient information becomes available for it to reasonably determine the settlement dates. |
INCOME TAXES
INCOME TAXES | 9 Months Ended |
Sep. 30, 2015 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES The anticipated after-tax economic benefit of an investment in the Partnership’s units depends largely on the Partnership being treated as a partnership for federal income tax purposes. If less than 90% of the gross income of a publicly traded partnership, such as the Partnership, for any taxable year is “qualifying income” from sources such as the transportation, storage, marketing (other than to end users), or processing of crude oil, natural gas or products thereof, rents from real property leased to unrelated parties, interest, dividends or certain other specified sources, that partnership will be taxable as a corporation under Section 7704 of the Internal Revenue Code for federal income tax purposes for that taxable year and all subsequent years. If the Partnership were treated as a corporation for federal income tax purposes, then it would pay federal income tax on its income at the corporate tax rate, which is currently a maximum of 35% , and would likely pay state income tax at varying rates. Distributions would generally be taxed again to unitholders as corporate distributions and none of the Partnership’s income, gains, losses, deductions or credits would flow through to its unitholders. Because a tax would be imposed upon the Partnership as an entity, cash available for distribution to its unitholders would be substantially reduced. Treatment of the Partnership as a corporation would result in a material reduction in the anticipated cash flow and after-tax return to unitholders and thus would likely result in a substantial reduction in the value of the Partnership’s units. The Partnership has entered into storage contracts with third party customers and leases with third party lessees with respect to all of its asphalt facilities. In the second quarter of 2009 , the Partnership submitted a request for a ruling from the IRS that rental income from the leases constitutes “qualifying income.” In October 2009 , the Partnership received a favorable ruling from the IRS to the effect that rental income received under the leases with third party lessees constitutes qualifying income. As part of this ruling, however, the Partnership agreed to transfer, and has transferred, certain of its asphalt processing assets and related fee income to a subsidiary taxed as a corporation. This transfer occurred in the first quarter of 2010. Such subsidiary’s income is subject to tax at the applicable federal, state and local income tax rates. Distributions from this subsidiary generally are taxed again to the Partnership’s unitholders as corporate distributions and none of the income, gains, losses, deductions or credits of this subsidiary will flow through to the Partnership’s unitholders. In relation to the Partnership’s taxable subsidiary, the tax effects of temporary differences between the tax basis of assets and liabilities and their financial reporting amounts at September 30, 2015 are presented below (dollars in thousands): Deferred tax assets Difference in bases of property, plant and equipment $ 908 Deferred tax asset 908 Less: valuation allowance 908 Net deferred tax asset $ — The Partnership has considered the taxable income projections in future years, whether the carryforward period is so brief that it would limit realization of tax benefits, whether future revenue and operating cost projections will produce enough taxable income to realize the deferred tax asset based on existing service rates and cost structures, and the Partnership’s earnings history exclusive of the loss that created the future deductible amount for the Partnership’s subsidiary that is taxed as a corporation for purposes of determining the likelihood of realizing the benefits of the deferred tax assets. As a result of the Partnership’s consideration of these factors, the Partnership has provided a full valuation allowance against its deferred tax asset as of September 30, 2015 . |
RECENTLY ISSUED ACCOUNTING STAN
RECENTLY ISSUED ACCOUNTING STANDARDS | 9 Months Ended |
Sep. 30, 2015 | |
New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | |
RECENTLY ISSUED ACCOUNTING STANDARDS | RECENTLY ISSUED ACCOUNTING STANDARDS In April 2014, the FASB issued ASU 2014-08, “Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity.” The amendments in this update change the criteria for reporting discontinued operations for all public and nonpublic entities. The amendments also require new disclosures about discontinued operations and disposals of components of an entity that do not qualify for discontinued operations reporting. The amendments in this update are effective for fiscal years, and interim periods within those years, beginning after December 15, 2014. The Partnership adopted this update for the period ending March 31, 2015, and there was no impact on the Partnership’s financial position, results of operations or cash flows. In May 2014, the FASB issued ASU 2014-09, “Revenue from Contracts with Customers.” The amendments in this update create Topic 606, Revenue from Contracts with Customers, and supersede the revenue recognition requirements in Topic 605, Revenue Recognition, including most industry-specific revenue recognition guidance throughout the Industry Topics of the Codification. In addition, the amendments supersede the cost guidance in Subtopic 605-35, Revenue Recognition-Construction-Type and Production-Type Contracts, and create new Subtopic 340-40, Other Assets and Deferred Costs-Contracts with Customers. In summary, the core principle of Topic 606 is that an entity recognizes revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In August 2015, the FASB issued Accounting Standards Update No. 2015-14, “Revenue from Contracts with Customers.” The amendments in this update are effective for fiscal years, and interim periods within those years, beginning after December 15, 2017. Earlier application is permitted only as of annual reporting periods beginning after December 15, 2016, including interim reporting periods within that reporting period. The Partnership is evaluating the impact of this guidance, which will be adopted beginning with the Partnership’s quarterly report for the period ending March 31, 2018. In August 2014, the FASB issued ASU 2014-15, “Presentation of Financial Statements - Going Concern.” The update provides U.S. GAAP guidance on management’s responsibility in evaluating whether there is substantial doubt about a company’s ability to continue as a going concern and about related footnote disclosures. For each reporting period, management will be required to evaluate whether there are conditions or events that raise substantial doubt about a company’s ability to continue as a going concern within one year from the date the financial statements are issued. The amendments in this update are effective for the annual period ending after December 15, 2016, and for annual periods and interim periods thereafter. The Partnership is evaluating the impact of this guidance, which will be adopted beginning with the Partnership’s annual report for the period ending December 31, 2016. On April 7, 2015, the FASB issued ASU 2015-03, “Simplifying the Presentation of Debt Issuance Costs”, which requires debt issuance costs to be presented in the balance sheet as a direct deduction from the associated debt liability. This update is effective for financial statements issued for fiscal years beginning after December 15, 2015, and interim periods within those fiscal years. The Partnership is evaluating the impact of this guidance, which will be adopted beginning with the Partnership’s quarterly report for the period ending March 31, 2016. On April 30, 2015, the FASB issued ASU 2015-06, “Effects on Historical Earnings per Unit of Master Limited Partnership Dropdown Transactions.” Master limited partnerships (MLPs) apply the two-class method to calculate earnings per unit (EPU) because the general partner, limited partners, and incentive distribution rights holders each participate differently in the distribution of available cash. When a general partner transfers (or “drops down”) net assets to a master limited partnership and that transaction is accounted for as a transaction between entities under common control, the statements of operations of the master limited partnership are adjusted retrospectively to reflect the dropdown transaction as if it occurred on the earliest date during which the entities were under common control. The amendments in ASU 2015-06 specify that for purposes of calculating historical EPU under the two-class method, the earnings (losses) of a transferred business before the date of a dropdown transaction should be allocated entirely to the general partner interest, and previously reported EPU of the limited partners would not change as a result of a dropdown transaction. Qualitative disclosures about how the rights to the earnings (losses) differ before and after the dropdown transaction occurs also are required. This update is effective for financial statements issued for fiscal years beginning after December 15, 2015, and interim periods within those fiscal years. The Partnership is evaluating the impact of this guidance, which will be adopted beginning with the Partnership’s quarterly report for the period ending March 31, 2016. In August 2015, the FASB issued ASU 2015-15, “Interest - Imputation of Interest (Subtopic 835-30).” This update adds SEC paragraphs pursuant to the SEC Staff Announcement at the June 18, 2015 Emerging Issues Task Force (EITF) meeting about the presentation and subsequent measurement of debt issuance costs associated with line-of-credit arrangements. The Partnership adopted this update for the interim period ending September 30, 2015, and there is no impact on the Partnership's financial position, results of operations or cash flows. In September 2015, the FASB issued ASU 2015-16, “Business Combinations (Topic 805).” Topic 805 requires that an acquirer retrospectively adjust provisional amounts recognized in a business combination, during the measurement period. To simplify the accounting for adjustments made to provisional amounts, the amendments in this update require that the acquirer recognize adjustments to provisional amounts that are identified during the measurement period in the reporting period in which the adjustment amount is determined. The acquirer is required to also record, in the same period’s financial statements, the effect on earnings of changes in depreciation, amortization, or other income effects, if any, as a result of the change to the provisional amounts, calculated as if the accounting had been completed at the acquisition date. In addition, an entity is required to present separately on the face of the income statement or disclose in the notes to the financial statements the portion of the amount recorded in current-period earnings by line item that would have been recorded in previous reporting periods if the adjustment to the provisional amounts had been recognized as of the acquisition date. This update is effective for financial statements issued for fiscal years beginning after December 15, 2015, and interim periods within those fiscal years. The Partnership is evaluating the impact of this guidance, which will be adopted beginning with the Partnership’s quarterly report for the period ending March 31, 2016. |
PROPERTY, PLANT AND EQUIPMENT (
PROPERTY, PLANT AND EQUIPMENT (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property, Plant and Equipment | Estimated Useful Lives (Years) December 31, 2014 September 30, 2015 (dollars in thousands) Land N/A $ 18,292 $ 19,637 Land improvements 10-20 6,398 6,473 Pipelines and facilities 5-30 168,537 179,585 Storage and terminal facilities 10-35 240,004 253,391 Transportation equipment 3-10 13,557 12,531 Office property and equipment and other 3-20 28,958 29,296 Pipeline linefill and tank bottoms N/A 10,186 3,886 Construction-in-progress N/A 16,671 31,181 Property, plant and equipment, gross 502,603 535,980 Accumulated depreciation (192,440 ) (209,545 ) Property, plant and equipment, net $ 310,163 $ 326,435 |
NET INCOME PER LIMITED PARTNE24
NET INCOME PER LIMITED PARTNER UNIT (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Earnings Per Share [Abstract] | |
Schedule of Basic and Diluted Net Income (Loss) Per Common and Subordinated Units | The following sets forth the computation of basic and diluted net income per common unit (in thousands, except per unit data): Three Months ended September 30, Nine Months ended September 30, 2014 2015 2014 2015 Net income $ 11,271 $ 13,967 $ 18,783 $ 23,258 General partner interest in net income 247 376 437 720 Preferred interest in net income 5,391 5,391 16,173 16,173 Income available to limited partners $ 5,633 $ 8,200 $ 2,173 $ 6,365 Basic weighted average number of units: Common units 23,909 32,947 23,245 32,919 Restricted and phantom units 725 721 659 675 Diluted weighted average number of units: Common units 54,927 63,875 23,245 32,919 Basic net income per common unit $ 0.23 $ 0.24 $ 0.09 $ 0.19 Diluted net income per common unit $ 0.20 $ 0.21 $ 0.09 $ 0.19 |
LONG-TERM INCENTIVE PLAN (Table
LONG-TERM INCENTIVE PLAN (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Schedule Of Phantom Common Units And Restricted Common Units Activity | Activity pertaining to phantom common units and restricted common unit awards granted under the Plan is as follows: Number of Units Weighted Average Grant Date Fair Value Nonvested at December 31, 2014 1,020,264 $ 7.46 Granted 266,076 7.74 Vested 322,800 6.41 Forfeited 46,095 8.65 Nonvested at September 30, 2015 917,445 $ 7.85 |
FAIR VALUE MEASUREMENTS Fair Va
FAIR VALUE MEASUREMENTS Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Fair Value Measurements [Abstract] | |
Fair Value, by Balance Sheet Grouping [Table Text Block] | The Partnership’s recurring financial assets and liabilities subject to fair value measurements and the necessary disclosures are as follows (in thousands): Fair Value Measurements as of December 31, 2014 Description Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Liabilities: Interest rate swap liabilities $ 2,634 $ — $ 2,634 $ — Total $ 2,634 $ — $ 2,634 $ — Fair Value Measurements as of September 30, 2015 Description Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Liabilities: Interest rate swap liabilities $ 5,269 $ — $ 5,269 $ — Total $ 5,269 $ — $ 5,269 $ — |
OPERATING SEGMENTS (Tables)
OPERATING SEGMENTS (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information, by Segment | The following table reflects certain financial data for each segment for the periods indicated (in thousands): Three Months ended September 30, Nine Months ended September 30, 2014 2015 2014 2015 Asphalt Services Service revenue Third party revenue $ 18,456 $ 21,307 $ 49,196 $ 54,934 Related party revenue 246 482 946 887 Total revenue for reportable segments 18,702 21,789 50,142 55,821 Operating expense (excluding depreciation and amortization) 6,627 6,308 20,115 19,067 Operating margin (excluding depreciation and amortization) 12,075 15,481 30,027 36,754 Total assets (end of period) $ 95,110 $ 101,434 $ 95,110 $ 101,434 Crude Oil Terminalling and Storage Services Service revenue Third party revenue $ 1,875 $ 3,524 $ 7,020 $ 9,721 Related party revenue 3,080 3,041 10,726 9,052 Total revenue for reportable segments 4,955 6,565 17,746 18,773 Operating expense (excluding depreciation and amortization) 1,006 1,325 2,980 4,582 Operating margin (excluding depreciation and amortization) 3,949 5,240 14,766 14,191 Total assets (end of period) $ 67,451 $ 73,628 $ 67,451 $ 73,628 Crude Oil Pipeline Services Service revenue Third party revenue $ 5,906 $ 2,594 $ 13,439 $ 11,107 Related party revenue 2,098 3,301 5,934 8,291 Total revenue for reportable segments 8,004 5,895 19,373 19,398 Operating expense (excluding depreciation and amortization) 2,484 4,855 11,600 13,589 Operating margin (excluding depreciation and amortization) 5,520 1,040 7,773 5,809 Total assets (end of period) $ 170,700 $ 192,945 $ 170,700 $ 192,945 Crude Oil Trucking and Producer Field Services Service revenue Third party revenue $ 12,264 $ 8,935 $ 38,280 $ 29,110 Related party revenue 4,433 4,033 15,057 13,045 Total revenue for reportable segments 16,697 12,968 53,337 42,155 Operating expense (excluding depreciation and amortization) 15,607 12,432 48,235 40,067 Operating margin (excluding depreciation and amortization) 1,090 536 5,102 2,088 Total assets (end of period) $ 28,208 $ 15,023 $ 28,208 $ 15,023 Total operating margin (excluding depreciation and amortization) (1) $ 22,634 $ 22,297 $ 57,668 $ 58,842 ____________________ (1) The following table reconciles segment operating margin (excluding depreciation and amortization) to income before income taxes (in thousands): Three Months ended September 30, Nine Months ended September 30, 2014 2015 2014 2015 Operating margin (excluding depreciation and amortization) $ 22,634 $ 22,297 $ 57,668 $ 58,842 Depreciation and amortization (6,571 ) (6,758 ) (19,342 ) (20,141 ) General and administrative expenses (4,267 ) (4,742 ) (13,124 ) (14,386 ) Gain on sale of assets 808 6,213 1,780 6,477 Interest expense (1,640 ) (4,343 ) (8,325 ) (10,576 ) Equity earnings in unconsolidated affiliate 423 1,399 477 3,338 Income before income taxes $ 11,387 $ 14,066 $ 19,134 $ 23,554 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Income Tax Disclosure [Abstract] | |
Schedule of Deferred Tax Assets | In relation to the Partnership’s taxable subsidiary, the tax effects of temporary differences between the tax basis of assets and liabilities and their financial reporting amounts at September 30, 2015 are presented below (dollars in thousands): Deferred tax assets Difference in bases of property, plant and equipment $ 908 Deferred tax asset 908 Less: valuation allowance 908 Net deferred tax asset $ — |
ORGANIZATION AND NATURE OF BU29
ORGANIZATION AND NATURE OF BUSINESS (Narrative) (Details) | 9 Months Ended |
Sep. 30, 2015Operating-segmentsStates | |
ORGANIZATION AND NATURE OF BUSINESS [Abstract] | |
Number of states in which entity operates (in states) | 23 |
Number of operating segments (in operating segments) | Operating-segments | 4 |
PROPERTY, PLANT AND EQUIPMENT30
PROPERTY, PLANT AND EQUIPMENT (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2014 | |
Property, Plant and Equipment [Line Items] | |||||
Property, plant and equipment, gross | $ 535,980 | $ 535,980 | $ 502,603 | ||
Accumulated Depreciation, property plant and equipment | 209,545 | 209,545 | 192,440 | ||
Property, plant and equipment, net | 326,435 | 326,435 | 310,163 | ||
Depreciation | 6,700 | $ 6,600 | 20,100 | $ 19,300 | |
Land [Member] | |||||
Property, Plant and Equipment [Line Items] | |||||
Property, plant and equipment, gross | 19,637 | 19,637 | 18,292 | ||
Land improvements [Member] | |||||
Property, Plant and Equipment [Line Items] | |||||
Property, plant and equipment, gross | 6,473 | $ 6,473 | 6,398 | ||
Land improvements [Member] | Minimum [Member] | |||||
Property, Plant and Equipment [Line Items] | |||||
Estimated Useful Lives | 10 years | ||||
Land improvements [Member] | Maximum [Member] | |||||
Property, Plant and Equipment [Line Items] | |||||
Estimated Useful Lives | 20 years | ||||
Pipelines [Member] | |||||
Property, Plant and Equipment [Line Items] | |||||
Property, plant and equipment, gross | 179,585 | $ 179,585 | 168,537 | ||
Pipelines [Member] | Minimum [Member] | |||||
Property, Plant and Equipment [Line Items] | |||||
Estimated Useful Lives | 5 years | ||||
Pipelines [Member] | Maximum [Member] | |||||
Property, Plant and Equipment [Line Items] | |||||
Estimated Useful Lives | 30 years | ||||
Storage and terminal facilities [Member] | |||||
Property, Plant and Equipment [Line Items] | |||||
Property, plant and equipment, gross | 253,391 | $ 253,391 | 240,004 | ||
Storage and terminal facilities [Member] | Minimum [Member] | |||||
Property, Plant and Equipment [Line Items] | |||||
Estimated Useful Lives | 10 years | ||||
Storage and terminal facilities [Member] | Maximum [Member] | |||||
Property, Plant and Equipment [Line Items] | |||||
Estimated Useful Lives | 35 years | ||||
Transportation equipment [Member] | |||||
Property, Plant and Equipment [Line Items] | |||||
Property, plant and equipment, gross | 12,531 | $ 12,531 | 13,557 | ||
Transportation equipment [Member] | Minimum [Member] | |||||
Property, Plant and Equipment [Line Items] | |||||
Estimated Useful Lives | 3 years | ||||
Transportation equipment [Member] | Maximum [Member] | |||||
Property, Plant and Equipment [Line Items] | |||||
Estimated Useful Lives | 10 years | ||||
Office property and equipment and other [Member] | |||||
Property, Plant and Equipment [Line Items] | |||||
Property, plant and equipment, gross | 29,296 | $ 29,296 | 28,958 | ||
Office property and equipment and other [Member] | Minimum [Member] | |||||
Property, Plant and Equipment [Line Items] | |||||
Estimated Useful Lives | 3 years | ||||
Office property and equipment and other [Member] | Maximum [Member] | |||||
Property, Plant and Equipment [Line Items] | |||||
Estimated Useful Lives | 20 years | ||||
Pipeline linefill and tank bottoms [Member] | |||||
Property, Plant and Equipment [Line Items] | |||||
Property, plant and equipment, gross | 3,886 | $ 3,886 | 10,186 | ||
Construction-in-progress [Member] | |||||
Property, Plant and Equipment [Line Items] | |||||
Property, plant and equipment, gross | $ 31,181 | $ 31,181 | $ 16,671 |
DEBT (Credit Agreements) (Detai
DEBT (Credit Agreements) (Details) | 3 Months Ended | 9 Months Ended | |||||
Sep. 30, 2015USD ($) | Sep. 30, 2014USD ($) | Sep. 30, 2015USD ($) | Sep. 30, 2014USD ($) | Oct. 29, 2015USD ($) | Dec. 31, 2014USD ($) | Jun. 28, 2013USD ($) | |
Debt Instrument [Line Items] | |||||||
Debt Instrument, Interest Rate During Period | 3.31% | 3.41% | 3.37% | 3.41% | |||
Debt issuance costs | $ 0 | $ 326,000 | |||||
Amortization of Financing Costs | $ 200,000 | $ 200,000 | 655,000 | 603,000 | |||
Interest expense for long-term debt | 2,000,000 | 2,500,000 | 5,900,000 | 7,300,000 | |||
Capitalized interest | 100,000 | 100,000 | 200,000 | 200,000 | |||
Derivative, Notional Amount | 200,000,000 | 200,000,000 | |||||
Interest rate swaps liability | 5,269,000 | 5,269,000 | $ 2,634,000 | ||||
Interest Expense, Other | 800,000 | 300,000 | $ 2,200,000 | 300,000 | |||
Blueknight General Partners G. P., L.L.C. [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Credit agreement, Constitute a change of control, if ceases to own, directly or indirectly, exactly 50% of the membership interests of the General Partner or if General Partner ceases to be controlled (as a percent) | 100.00% | ||||||
Vitol or Charlesbank [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Credit agreement, Constitute a change of control if Vitol Holding BV and Charlesbank ceasing to collectively own and control 50% of the GP | 50.00% | ||||||
Revolving Credit Facility [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Revolving credit facility amount | $ 400,000,000 | ||||||
Maximum borrowing capacity including additional lenders | $ 500,000,000 | $ 500,000,000 | |||||
Debt Instrument Maximum Covenant Consolidated Senior Secured Leverage Ratio | 3.50 | 3.50 | |||||
Consolidated interest coverage (as a ratio), minimum permitted | 2.50 | 2.50 | |||||
Consolidated total leverage (as a ratio), actual | 3.40 | 3.40 | |||||
Consolidated interest coverage (as a ratio), actual | 7.20 | 7.20 | |||||
Debt issuance costs | $ 0 | $ 326,000 | $ 0 | $ 326,000 | |||
Weighted average interest rate (as a percent) | 3.33% | 3.33% | |||||
Revolving Credit Facility [Member] | Minimum [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Unused capacity, commitment fee (as a percent) | 0.375% | ||||||
Debt Instrument Covenant, Issued Qualified Senior Notes | $ 200,000,000 | $ 200,000,000 | |||||
Revolving Credit Facility [Member] | Maximum [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Unused capacity, commitment fee (as a percent) | 0.50% | ||||||
Revolving Credit Facility [Member] | Subsequent Event [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Revolver borrowings | $ 235,000,000 | ||||||
Unused borrowing capacity | 163,700,000 | ||||||
Revolving Credit Facility [Member] | Federal funds rate [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Basis spread on variable rate (as a percent) | 0.50% | ||||||
Revolving Credit Facility [Member] | Eurodollar rate [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Basis spread on variable rate (as a percent) | 1.00% | ||||||
Revolving Credit Facility [Member] | Applicable margin based on ABR [Member] | Minimum [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Applicable margin interest rate increase (as a percent) | 1.00% | ||||||
Revolving Credit Facility [Member] | Applicable margin based on ABR [Member] | Maximum [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Applicable margin interest rate increase (as a percent) | 2.00% | ||||||
Revolving Credit Facility [Member] | Applicable margin based on Eurodollar rate [Member] | Minimum [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Basis spread on variable rate (as a percent) | 2.00% | ||||||
Revolving Credit Facility [Member] | Applicable margin based on Eurodollar rate [Member] | Maximum [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Basis spread on variable rate (as a percent) | 3.00% | ||||||
Letter of Credit [Member] | Subsequent Event [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Letters of credit outstanding, amount | $ 1,300,000 | ||||||
Interest Rate Swap [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Derivative, Notional Amount | $ 100,000,000 | $ 100,000,000 | |||||
Derivative, Fixed Interest Rate | 1.45% | 1.45% | |||||
Interest Rate Swap Two [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Derivative, Notional Amount | $ 100,000,000 | $ 100,000,000 | |||||
Derivative, Fixed Interest Rate | 1.97% | 1.97% | |||||
Aggregate Principal Below Threshold [Member] | Revolving Credit Facility [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Consolidated total leverage (as a ratio), Maximum permitted | 4.50 | 4.50 | |||||
Minimum Acquisition Costs | $ 10,000,000 | ||||||
Minimum Percent of Projected Capital Expenditures | 50.00% | ||||||
Minimum Capital Expenditure | $ 15,000,000 | ||||||
Debt Instrument Covenant, Issued Qualified Senior Notes | $ 200,000,000 | 200,000,000 | |||||
Aggregate Principal Above Threshold [Member] | Revolving Credit Facility [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Debt Instrument Covenant, Issued Qualified Senior Notes | $ 200,000,000 | $ 200,000,000 | |||||
Provision One, Applicable Period One [Member] | Aggregate Principal Below Threshold [Member] | Revolving Credit Facility [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Consolidated total leverage (as a ratio), Maximum permitted | 5 | 5 | |||||
Provision One, Applicable Period One [Member] | Aggregate Principal Above Threshold [Member] | Revolving Credit Facility [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Consolidated total leverage (as a ratio), Maximum permitted | 5 | 5 | |||||
Provision One, Applicable Period Two [Member] | Aggregate Principal Below Threshold [Member] | Revolving Credit Facility [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Consolidated total leverage (as a ratio), Maximum permitted | 4.75 | 4.75 | |||||
Provision One, Applicable Period Three [Member] | Aggregate Principal Below Threshold [Member] | Revolving Credit Facility [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Consolidated total leverage (as a ratio), Maximum permitted | 4.50 | 4.50 | |||||
Provision Two, Applicable Period One [Member] | Aggregate Principal Below Threshold [Member] | Revolving Credit Facility [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Consolidated total leverage (as a ratio), Maximum permitted | 5.50 | 5.50 | |||||
Provision Two, Applicable Period One [Member] | Aggregate Principal Above Threshold [Member] | Revolving Credit Facility [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Consolidated total leverage (as a ratio), Maximum permitted | 5.50 | 5.50 | |||||
Provision Three, Applicable Period One [Member] | Aggregate Principal Below Threshold [Member] | Revolving Credit Facility [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Consolidated total leverage (as a ratio), Maximum permitted | 5 | 5 | |||||
Provision Two, Applicable Period Two [Member] | Aggregate Principal Above Threshold [Member] | Revolving Credit Facility [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Consolidated total leverage (as a ratio), Maximum permitted | 5 | 5 |
NET INCOME PER LIMITED PARTNE32
NET INCOME PER LIMITED PARTNER UNIT (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Earnings Per Share [Abstract] | ||||
Net income | $ 13,967 | $ 11,271 | $ 23,258 | $ 18,783 |
General partner interest in net income | 376 | 247 | 720 | 437 |
Preferred interest in net income | 5,391 | 5,391 | 16,173 | 16,173 |
Income available to limited partners | $ 8,200 | $ 5,633 | $ 6,365 | $ 2,173 |
Basic and diluted weighted average number of units: | ||||
Weighted average common units outstanding - basic | 32,947 | 23,909 | 32,919 | 23,245 |
Restricted and phantom units | 721 | 725 | 675 | 659 |
Weighted average common units outstanding - diluted | 63,875 | 54,927 | 32,919 | 23,245 |
Basic net income per common unit | $ 0.24 | $ 0.23 | $ 0.19 | $ 0.09 |
Diluted net income per common unit | $ 0.21 | $ 0.20 | $ 0.19 | $ 0.09 |
PARTNERS' CAPITAL AND DISTRIB33
PARTNERS' CAPITAL AND DISTRIBUTIONS (Narrative) (Details) $ / shares in Units, $ in Millions | 3 Months Ended |
Sep. 30, 2015USD ($)$ / shares | |
Distribution Made to Member or Limited Partner, Cash Distributions Declared | $ 4.8 |
Phantom Share Units and Restricted Units [Member] | |
Distribution Made to Member or Limited Partner, Cash Distributions Declared | $ 0.1 |
Limited Partner [Member] | |
Distribution Made to Member or Limited Partner, Distributions Declared (in dollars per unit) | $ / shares | $ 0.1450 |
Distribution Made to Member or Limited Partner, Cash Distributions Declared | $ 5.2 |
General Partner Interest [Member] | |
Distribution Made to Member or Limited Partner, Cash Distributions Declared | $ 0.3 |
Preferred Partner [Member] | |
Distribution Made to Member or Limited Partner, Distributions Declared (in dollars per unit) | $ / shares | $ 0.17875 |
Distribution Made to Member or Limited Partner, Cash Distributions Declared | $ 5.4 |
PARTNERS' CAPITAL AND DISTRIB34
PARTNERS' CAPITAL AND DISTRIBUTIONS Issuances Narrative (Details) - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | ||
Dec. 31, 2014 | Sep. 25, 2015 | Sep. 22, 2014 | |
Capital Unit [Line Items] | |||
Limited Partners' Capital Account, Units Issued | 30,075 | 9,775,000 | |
Sale of Stock, Price Per Share | $ 7.61 | ||
Limited Partners' Offering Costs | $ 3.2 | ||
Limited Partner [Member] | |||
Capital Unit [Line Items] | |||
Proceeds from Issuance of Common Limited Partners Units | $ 71.2 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2014 | |
Related Party Transaction [Line Items] | |||||
Related party revenue | $ 10,857 | $ 9,857 | $ 31,275 | $ 32,663 | |
Receivables from related parties | 2,696 | 2,696 | $ 2,316 | ||
Vitol [Member] | |||||
Related Party Transaction [Line Items] | |||||
Related party revenue | 10,500 | 9,600 | 30,300 | 31,900 | |
Receivables from related parties | 2,600 | 2,600 | 2,300 | ||
Due to Related Parties | 200 | 200 | 1,000 | ||
Advantage Pipeline, L.L.C. [Member] | |||||
Related Party Transaction [Line Items] | |||||
Related party revenue | 400 | $ 300 | 1,000 | $ 700 | |
Receivables from related parties | $ 100 | $ 100 | $ 100 |
LONG-TERM INCENTIVE PLAN (Detai
LONG-TERM INCENTIVE PLAN (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 9 Months Ended | |||||||||
Mar. 31, 2015 | Dec. 31, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Apr. 28, 2014 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||
Equity-based incentive compensation expense (in dollars) | $ 1,459,000 | $ 848,000 | ||||||||||
Plan [Member] | ||||||||||||
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 | 1,500,000 | |||||||||||
Number of units authorized | 4,100,000 | 4,100,000 | 2,600,000 | |||||||||
Number of Units [Roll Forward] | ||||||||||||
Number of Units, Nonvested, Beginning balance | 1,020,264 | |||||||||||
Number of Units, Granted | 266,076 | |||||||||||
Number of Units, Vested | 322,800 | |||||||||||
Number of Units, Forfeited | 46,095 | |||||||||||
Number of Units, Nonvested, Ending balance | 1,020,264 | 917,445 | 917,445 | |||||||||
Weighted Average Grant Date Fair Value [Roll Forward] | ||||||||||||
Weighted Average Grant Date Fair Value, Nonvested, Beginning balance (in dollars per unit) | $ 7.46 | |||||||||||
Weighted Average Grant Date Fair Value, Granted (in dollars per unit) | 7.74 | |||||||||||
Weighted Average Grant Date Fair Value, Vested (in dollars per unit) | 6.41 | |||||||||||
Weighted Average Grant Date Fair Value, Forfeited (in dollars per unit) | 8.65 | |||||||||||
Weighted Average Grant Date Fair Value, Nonvested, Ending balance (in dollars per unit) | $ 7.46 | $ 7.85 | $ 7.85 | |||||||||
Plan [Member] | Phantom common units [Member] | ||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||
Value of award grants (in dollars) | $ 2,100,000 | $ 2,500,000 | $ 2,200,000 | |||||||||
Unrecognized estimated compensation cost (in dollars) | $ 2,700,000 | $ 2,700,000 | ||||||||||
Equity-based incentive compensation expense (in dollars) | 700,000 | $ 600,000 | 1,900,000 | $ 1,600,000 | ||||||||
Weighted Average Grant Date Fair Value [Roll Forward] | ||||||||||||
Weighted Average Grant Date Fair Value, Granted (in dollars per unit) | $ 7.74 | $ 9.06 | $ 8.75 | |||||||||
Plan [Member] | Phantom common units [Member] | Chief Executive Officer [Member] | ||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||
Vesting period | 5 years | |||||||||||
Value of award grants (in dollars) | $ 2,800,000 | |||||||||||
Unrecognized estimated compensation cost (in dollars) | $ 1,100,000 | $ 1,100,000 | ||||||||||
Number of Units [Roll Forward] | ||||||||||||
Number of Units, Granted | 500,000 | |||||||||||
Weighted Average Grant Date Fair Value [Roll Forward] | ||||||||||||
Weighted Average Grant Date Fair Value, Granted (in dollars per unit) | $ 5.62 | |||||||||||
Plan [Member] | Restricted common units [Member] | Independent Directors [Member] | ||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||
Award vesting rights percentage | 33.00% | 33.00% | 33.00% | |||||||||
Value of award grants (in dollars) | $ 100,000 | $ 100,000 | $ 49,200 | |||||||||
Number of Units [Roll Forward] | ||||||||||||
Number of Units, Granted | 7,500 | 7,500 | 7,500 | |||||||||
January 2016 Vesting [Member] | Plan [Member] | Phantom common units [Member] | ||||||||||||
Number of Units [Roll Forward] | ||||||||||||
Number of Units, Granted | 251,106 | |||||||||||
January 2017 Vesting [Member] | Plan [Member] | Phantom common units [Member] | ||||||||||||
Number of Units [Roll Forward] | ||||||||||||
Number of Units, Granted | 276,773 | |||||||||||
January 2018 Vesting [Member] | Plan [Member] | Phantom common units [Member] | ||||||||||||
Number of Units [Roll Forward] | ||||||||||||
Number of Units, Granted | 266,076 |
EMPLOYEE BENEFIT PLAN (Details)
EMPLOYEE BENEFIT PLAN (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Defined Contribution Plan Disclosure [Line Items] | ||||
Employee Stock Ownership Plan (ESOP), Compensation Expense | $ 0.1 | $ 0.1 | ||
Defined Contribution Pension [Member] | ||||
Defined Contribution Plan Disclosure [Line Items] | ||||
Employer discretionary contribution amount | 0.4 | $ 0.4 | 1.2 | $ 1.1 |
Deferred Profit Sharing [Member] | ||||
Defined Contribution Plan Disclosure [Line Items] | ||||
Employer discretionary contribution amount | $ 0.3 | $ 0.2 | $ 0.6 | $ 0.5 |
EMPLOYEE BENEFIT PLAN EUPP (Det
EMPLOYEE BENEFIT PLAN EUPP (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |
Sep. 30, 2015 | Sep. 30, 2015 | Mar. 31, 2015 | |
EUPP [Abstract] | |||
Employee Stock Ownership Plan (ESOP), Shares in ESOP | 1,000,000 | ||
Employee Stock Ownership Plan (ESOP), Compensation Expense | $ 0.1 | $ 0.1 |
FAIR VALUE MEASUREMENTS Fair 39
FAIR VALUE MEASUREMENTS Fair Value Measurements (Details) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Interest rate swaps liability | $ 5,269 | $ 2,634 |
Total | 5,269 | 2,634 |
Fair Value, Inputs, Level 1 [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Interest rate swaps liability | 0 | 0 |
Total | 0 | 0 |
Fair Value, Inputs, Level 2 [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Interest rate swaps liability | 5,269 | 2,634 |
Total | 5,269 | 2,634 |
Fair Value, Inputs, Level 3 [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Interest rate swaps liability | 0 | 0 |
Total | $ 0 | $ 0 |
OPERATING SEGMENTS (Details)
OPERATING SEGMENTS (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2015USD ($)StatesTerminalling_And_Storage_Facilities | Sep. 30, 2014USD ($) | Sep. 30, 2015USD ($)Operating-segmentsStatesTerminalling_And_Storage_FacilitiesPipeline_Systems | Sep. 30, 2014USD ($) | Dec. 31, 2014USD ($) | ||
Segment Reporting Information [Line Items] | ||||||
Number of operating segments (in operating segments) | Operating-segments | 4 | |||||
Service revenue | ||||||
Third party revenue | $ 36,360 | $ 38,501 | $ 104,872 | $ 107,935 | ||
Related party revenue | 10,857 | 9,857 | 31,275 | 32,663 | ||
Total revenue for reportable segments | 47,217 | 48,358 | 136,147 | 140,598 | ||
Operating margin (excluding depreciation and amortization) | [1] | 22,297 | 22,634 | 58,842 | 57,668 | |
Total assets (end of period) | 383,030 | 383,030 | $ 364,395 | |||
Reconciles segment operating margin (excluding depreciation and amortization) to income before income taxes | ||||||
Operating margin (excluding depreciation and amortization) | [1] | 22,297 | 22,634 | 58,842 | 57,668 | |
Depreciation, Depletion and Amortization | (6,758) | (6,571) | (20,141) | (19,342) | ||
General and administrative expenses | (4,742) | (4,267) | (14,386) | (13,124) | ||
Gain on sale of assets | 6,213 | 808 | 6,477 | 1,780 | ||
Interest expense | (4,343) | (1,640) | (10,576) | (8,325) | ||
Equity earnings in unconsolidated affiliate | 1,399 | 423 | 3,338 | 477 | ||
Income from continuing operations before income taxes | $ 14,066 | 11,387 | $ 23,554 | 19,134 | ||
Asphalt Services [Member] | ||||||
Segment Reporting Information [Line Items] | ||||||
Number of terminalling and storage facilities providing asphalt product and residual fuel terminalling storage and blending services (in terminalling and storage facilities) | Terminalling_And_Storage_Facilities | 43 | 43 | ||||
Number of states that Asphalt product and residual fuel terminalling, storage and blending services at its terminalling and storage facilities are provided (in states) | States | 22 | 22 | ||||
Service revenue | ||||||
Third party revenue | $ 21,307 | 18,456 | $ 54,934 | 49,196 | ||
Related party revenue | 482 | 246 | 887 | 946 | ||
Total revenue for reportable segments | 21,789 | 18,702 | 55,821 | 50,142 | ||
Operating expenses (excluding depreciation and amortization) | 6,308 | 6,627 | 19,067 | 20,115 | ||
Operating margin (excluding depreciation and amortization) | 15,481 | 12,075 | 36,754 | 30,027 | ||
Total assets (end of period) | 101,434 | 95,110 | 101,434 | 95,110 | ||
Reconciles segment operating margin (excluding depreciation and amortization) to income before income taxes | ||||||
Operating margin (excluding depreciation and amortization) | 15,481 | 12,075 | 36,754 | 30,027 | ||
Crude Oil Terminalling and Storage Services [Member] | ||||||
Service revenue | ||||||
Third party revenue | 3,524 | 1,875 | 9,721 | 7,020 | ||
Related party revenue | 3,041 | 3,080 | 9,052 | 10,726 | ||
Total revenue for reportable segments | 6,565 | 4,955 | 18,773 | 17,746 | ||
Operating expenses (excluding depreciation and amortization) | 1,325 | 1,006 | 4,582 | 2,980 | ||
Operating margin (excluding depreciation and amortization) | 5,240 | 3,949 | 14,191 | 14,766 | ||
Total assets (end of period) | 73,628 | 67,451 | 73,628 | 67,451 | ||
Reconciles segment operating margin (excluding depreciation and amortization) to income before income taxes | ||||||
Operating margin (excluding depreciation and amortization) | 5,240 | 3,949 | $ 14,191 | 14,766 | ||
Crude Oil Pipeline Services [Member] | ||||||
Segment Reporting Information [Line Items] | ||||||
Number of pipelines systems owned and operated (in pipeline systems) | Pipeline_Systems | 3 | |||||
Service revenue | ||||||
Third party revenue | 2,594 | 5,906 | $ 11,107 | 13,439 | ||
Related party revenue | 3,301 | 2,098 | 8,291 | 5,934 | ||
Total revenue for reportable segments | 5,895 | 8,004 | 19,398 | 19,373 | ||
Operating expenses (excluding depreciation and amortization) | 4,855 | 2,484 | 13,589 | 11,600 | ||
Operating margin (excluding depreciation and amortization) | 1,040 | 5,520 | 5,809 | 7,773 | ||
Total assets (end of period) | 192,945 | 170,700 | 192,945 | 170,700 | ||
Reconciles segment operating margin (excluding depreciation and amortization) to income before income taxes | ||||||
Operating margin (excluding depreciation and amortization) | 1,040 | 5,520 | 5,809 | 7,773 | ||
Crude Oil Trucking and Producer Field Services [Member] | ||||||
Service revenue | ||||||
Third party revenue | 8,935 | 12,264 | 29,110 | 38,280 | ||
Related party revenue | 4,033 | 4,433 | 13,045 | 15,057 | ||
Total revenue for reportable segments | 12,968 | 16,697 | 42,155 | 53,337 | ||
Operating expenses (excluding depreciation and amortization) | 12,432 | 15,607 | 40,067 | 48,235 | ||
Operating margin (excluding depreciation and amortization) | 536 | 1,090 | 2,088 | 5,102 | ||
Total assets (end of period) | 15,023 | 28,208 | 15,023 | 28,208 | ||
Reconciles segment operating margin (excluding depreciation and amortization) to income before income taxes | ||||||
Operating margin (excluding depreciation and amortization) | $ 536 | $ 1,090 | $ 2,088 | $ 5,102 | ||
[1] | The following table reconciles segment operating margin (excluding depreciation and amortization) to income before income taxes (in thousands): Three Months endedSeptember 30, Nine Months ended September 30, 2014 2015 2014 2015Operating margin (excluding depreciation and amortization)$22,634 $22,297 $57,668 $58,842Depreciation and amortization(6,571) (6,758) (19,342) (20,141)General and administrative expenses(4,267) (4,742) (13,124) (14,386)Gain on sale of assets808 6,213 1,780 6,477Interest expense(1,640) (4,343) (8,325) (10,576)Equity earnings in unconsolidated affiliate423 1,399 477 3,338Income before income taxes$11,387 $14,066 $19,134 $23,554 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Narrative) (Details) | 3 Months Ended | |
Sep. 30, 2015USD ($) | Feb. 06, 2012USD ($)bbl | |
Settled Litigation [Member] | Physical Management and Control of Crude Oil [Member] | ||
Loss Contingencies [Line Items] | ||
Judgement seeking immediate return of crude cil Linefill belonging to company (in BOE) | bbl | 140,000 | |
Gain (Loss) on Sale of Assets and Asset Impairment Charges | $ 6,000,000 | |
Minimum [Member] | Settled Litigation [Member] | Physical Management and Control of Crude Oil [Member] | ||
Loss Contingencies [Line Items] | ||
Gain contingency, unrecorded amount | $ 75,000 | |
Minimum [Member] | Pending Litigation [Member] | Motor Vehicle Accident [Member] | ||
Loss Contingencies [Line Items] | ||
Loss Contingency, Estimate of Possible Loss | $ 75,000 |
INCOME TAXES (Details)
INCOME TAXES (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2015USD ($) | |
Income Tax Disclosure [Abstract] | |
Gross income of a partnership, for any taxable year is qualifying income will be taxable as a corporation for federal income tax purposes for that taxable year and all subsequent years, maximum (as a percent) | 90.00% |
Federal statutory income tax rate (as a percent) | 35.00% |
Valuation Allowance [Line Items] | |
Difference in bases of property, plant and equipment | $ 908 |
Deferred tax asset | 908 |
Less: valuation allowance | (908) |
Net deferred tax asset | $ 0 |