Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2016 | Apr. 26, 2016 | |
Document and Entity Information | ||
Entity Registrant Name | CVR Partners, LP | |
Entity Central Index Key | 1,425,292 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2016 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 113,282,973 | |
Document Fiscal Year Focus | 2,016 | |
Document Fiscal Period Focus | Q1 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 |
Current assets: | ||
Cash and cash equivalents | $ 51,979 | $ 49,967 |
Accounts receivable, net of allowance for doubtful accounts of $258 and $27, at March 31, 2016 and December 31, 2015, respectively | 9,066 | 7,187 |
Inventories | 32,592 | 37,529 |
Prepaid expenses and other current assets, including $283 and $883 from affiliates at March 31, 2016 and December 31, 2015, respectively | 3,100 | 3,862 |
Total current assets | 96,737 | 98,545 |
Property, plant, and equipment, net of accumulated depreciation | 387,635 | 393,133 |
Goodwill | 40,969 | 40,969 |
Other long-term assets, including $732 and $777 with affiliates at March 31, 2016 and December 31, 2015, respectively | 3,881 | 3,608 |
Total assets | 529,222 | 536,255 |
Current liabilities: | ||
Accounts payable, including $1,617 and $1,940 due to affiliates at March 31, 2016 and December 31, 2015, respectively | 11,488 | 11,103 |
Personnel accruals, including $1,230 and $1,974 with affiliates at March 31, 2016 and December 31, 2015, respectively | 3,162 | 5,999 |
Deferred revenue | 838 | 3,129 |
Accrued expenses and other current liabilities, including $919 and $2,334 with affiliates at March 31, 2016 and December 31, 2015, respectively | 4,776 | 5,683 |
Total current liabilities | 20,264 | 25,914 |
Long-term liabilities: | ||
Long-term debt, net of current portion | 124,974 | 124,773 |
Other long-term liabilities | 16 | 16 |
Total long-term liabilities | $ 124,990 | $ 124,789 |
Commitments and contingencies | ||
Partners’ capital: | ||
Common unitholders 73,128,269 units issued and outstanding at March 31, 2016 and December 31, 2015 | $ 383,967 | $ 385,670 |
General partner interest | 1 | 1 |
Accumulated other comprehensive loss | 0 | (119) |
Total partners’ capital | 383,968 | 385,552 |
Total liabilities and partners’ capital | $ 529,222 | $ 536,255 |
CONDENSED CONSOLIDATED BALANCE3
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 |
Statement of Financial Position [Abstract] | ||
Accounts receivable, allowance for doubtful accounts | $ 258 | $ 27 |
Prepaid expenses and other current assets, from affiliates | 283 | 883 |
Other long-term assets, with affiliates | 732 | 777 |
Accounts payable, due to affiliates | 1,617 | 1,940 |
Personnel accruals, with affiliates | 1,230 | 1,974 |
Accrued expenses and other current liabilities, with affiliates | $ 919 | $ 2,334 |
Common unitholders, units issued (in units) | 73,128,269 | 73,128,269 |
Common unitholders, units outstanding (in units) | 73,128,269 | 73,128,269 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Net sales | $ 73,092 | $ 93,050 |
Operating costs and expenses: | ||
Cost of product sold (exclusive of depreciation and amortization) | 16,381 | 25,769 |
Direct operating costs (exclusive of depreciation and amortization) | 23,690 | 24,414 |
Selling, general and administrative expenses (exclusive of depreciation and amortization) | 6,392 | 4,583 |
Depreciation and amortization | 6,976 | 6,819 |
Total operating costs and expenses | 53,439 | 61,585 |
Operating income | 19,653 | 31,465 |
Other income (expense): | ||
Interest expense and other financing costs | (1,635) | (1,697) |
Interest income | 2 | 12 |
Other income, net | 23 | 6 |
Total other income (expense) | (1,610) | (1,679) |
Income before income tax expense | 18,043 | 29,786 |
Income tax expense | 1 | 12 |
Net income | $ 18,042 | $ 29,774 |
Net income per common unit – basic (in dollars per units) | $ 0.25 | $ 0.41 |
Net income per common unit – diluted (in dollars per units) | $ 0.25 | $ 0.41 |
Weighted-average common units outstanding: | ||
Basic (in units) | 73,128 | 73,123 |
Diluted (in units) | 73,128 | 73,131 |
Affiliates | ||
Operating costs and expenses: | ||
Cost of product sold (exclusive of depreciation and amortization) | $ 821 | $ 1,818 |
Direct operating costs (exclusive of depreciation and amortization) | 852 | 1,027 |
Selling, general and administrative expenses (exclusive of depreciation and amortization) | 3,462 | 3,267 |
Third Party | ||
Operating costs and expenses: | ||
Cost of product sold (exclusive of depreciation and amortization) | 15,560 | 23,951 |
Direct operating costs (exclusive of depreciation and amortization) | 22,838 | 23,387 |
Selling, general and administrative expenses (exclusive of depreciation and amortization) | $ 2,930 | $ 1,316 |
CONDENSED CONSOLIDATED STATEME5
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Statement of Comprehensive Income [Abstract] | ||
Net income | $ 18,042 | $ 29,774 |
Other comprehensive income (loss): | ||
Change in fair value of interest rate swaps | 0 | (72) |
Net loss reclassified into income on settlement of interest rate swaps | 119 | 267 |
Other comprehensive income | 119 | 195 |
Total comprehensive income | $ 18,161 | $ 29,969 |
CONDENSED CONSOLIDATED STATEME6
CONDENSED CONSOLIDATED STATEMENT OF PARTNERS' CAPITAL - 3 months ended Mar. 31, 2016 - USD ($) $ in Thousands | Total | Common Units | General Partner Interest | Accumulated Other Comprehensive Income/(Loss) |
Balance (in units) at Dec. 31, 2015 | 73,128,269 | |||
Balance at Dec. 31, 2015 | $ 385,552 | $ 385,670 | $ 1 | $ (119) |
Increase (Decrease) in Partners' Capital | ||||
Cash distributions to common unitholders – Affiliates | (10,509) | (10,509) | ||
Cash distributions to common unitholders – Non-affiliates | (9,236) | (9,236) | ||
Net income | 18,042 | $ 18,042 | ||
Other comprehensive income | 119 | 119 | ||
Balance (in units) at Mar. 31, 2016 | 73,128,269 | |||
Balance at Mar. 31, 2016 | $ 383,968 | $ 383,967 | $ 1 | $ 0 |
CONDENSED CONSOLIDATED STATEME7
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Cash flows from operating activities: | ||
Net income | $ 18,042 | $ 29,774 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 6,976 | 6,819 |
Allowance for doubtful accounts | 231 | (8) |
Amortization of deferred financing costs | 241 | 240 |
Share-based compensation | 153 | 173 |
Change in assets and liabilities: | ||
Accounts receivable | (2,110) | (2,664) |
Inventories | 4,937 | 1,743 |
Prepaid expenses and other current assets | 722 | (350) |
Other long-term assets | (131) | 93 |
Accounts payable | 648 | 975 |
Deferred revenue | (2,291) | (7,271) |
Accrued expenses and other current liabilities | (4,273) | (4,844) |
Other long-term liabilities | 0 | 6 |
Net cash provided by operating activities | 23,640 | 25,365 |
Cash flows from investing activities: | ||
Capital expenditures | (1,733) | (2,661) |
Net cash used in investing activities | (1,733) | (2,661) |
Cash flows from financing activities: | ||
Payment of financing costs | (150) | 0 |
Cash distributions to common unitholders – Affiliates | (10,509) | (15,957) |
Cash distributions to common unitholders – Non-affiliates | (9,236) | (14,023) |
Net cash used in financing activities | (19,895) | (29,980) |
Net decrease in cash and cash equivalents | 2,012 | (7,276) |
Cash and cash equivalents, beginning of period | 49,967 | 79,914 |
Cash and cash equivalents, end of period | 51,979 | 72,638 |
Supplemental disclosures: | ||
Cash paid for income taxes, net | 0 | 0 |
Cash paid for interest | 1,545 | 1,477 |
Non-cash investing and financing activities: | ||
Construction in progress additions included in accounts payable | 767 | 806 |
Change in accounts payable related to construction in progress | (263) | (260) |
Affiliates | ||
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Share-based compensation | $ 495 | $ 679 |
Formation of the Partnership, O
Formation of the Partnership, Organization and Nature of Business | 3 Months Ended |
Mar. 31, 2016 | |
Formation of the Partnership, Organization and Nature of Business | |
Formation of the Partnership, Organization and Nature of Business | (1) Formation of the Partnership, Organization and Nature of Business Organization CVR Partners, LP (referred to as "CVR Partners" or the "Partnership") is a Delaware limited partnership, formed in June 2007 by CVR Energy, Inc. (together with its subsidiaries, but excluding the Partnership and its subsidiaries, "CVR Energy") to own Coffeyville Resources Nitrogen Fertilizers, LLC ("CRNF"). CRNF is an independent producer and marketer of upgraded nitrogen fertilizer products sold in North America. CRNF operates a dual-train coke gasifier plant that produces high-purity hydrogen, most of which is subsequently converted to ammonia and upgraded to urea ammonium nitrate ("UAN"). CRNF produces and distributes nitrogen fertilizer products, which are used primarily by farmers to improve the yield and quality of their crops. CRNF's principal products are UAN and ammonia. These products are manufactured at CRNF's facility in Coffeyville, Kansas. CRNF's product sales are heavily weighted toward UAN and all of its products are sold on a wholesale basis. As of March 31, 2016 , public security holders held approximately 47% of the Partnership's outstanding limited partner interests and Coffeyville Resources, LLC ("CRLLC"), a wholly-owned subsidiary of CVR Energy, Inc. ("CVR Energy"), held approximately 53% of the Partnership's outstanding limited partner interests and 100% of the noneconomic general partner interest. As of March 31, 2016 , Icahn Enterprises L.P. ("IEP") and its affiliates owned approximately 82% of the shares of CVR Energy. East Dubuque Mergers Immediately subsequent to the completion of the mergers on April 1, 2016, which are discussed in Note 4 ("Mergers") , CRLLC held approximately 34% of the Partnership's outstanding limited partner interests and 100% of the noneconomic general partner interest. Management and Operations CVR GP, LLC ("CVR GP" or the "general partner") manages and operates the Partnership. Common unitholders have only limited voting rights on matters affecting the Partnership. In addition, common unitholders have no right to elect the general partner's directors on an annual or continuing basis. The Partnership is operated by a combination of the general partner's senior management team and CVR Energy's senior management team pursuant to a services agreement among CVR Energy, CVR GP and the Partnership. The various rights and responsibilities of the Partnership's partners are set forth in the limited partnership agreement. The Partnership also is party to a number of agreements with CVR Energy and CVR GP to regulate certain business relations between the Partnership and the other parties thereto. See Note 14 ("Related Party Transactions") for further discussion. |
Basis of Presentation
Basis of Presentation | 3 Months Ended |
Mar. 31, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | (2) Basis of Presentation The accompanying Partnership condensed consolidated financial statements include the accounts of CVR Partners and its subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. The accompanying condensed consolidated financial statements were prepared in accordance with U.S. generally accepted accounting principles ("GAAP") and in accordance with the rules and regulations of the Securities and Exchange Commission ("SEC"). These condensed consolidated financial statements should be read in conjunction with the December 31, 2015 audited consolidated financial statements and notes thereto included in CVR Partners’ Annual Report on Form 10-K for the year ended December 31, 2015 , which was filed with the SEC on February 18, 2016 (the "2015 Form 10-K"). The condensed consolidated financial statements include certain selling, general and administrative expenses and direct operating expenses that CVR Energy and its subsidiaries incurred on behalf of the Partnership. These related party transactions are governed by the services agreement. See Note 14 ("Related Party Transactions") for additional discussion of the services agreement and billing and allocation of certain costs. In the opinion of the Partnership’s management, the accompanying condensed consolidated financial statements and related notes reflect all adjustments (consisting only of normal recurring adjustments) that are necessary to fairly present the financial position of the Partnership as of March 31, 2016 and December 31, 2015 , the results of operations and comprehensive income of the Partnership for the three months ended March 31, 2016 and 2015 , the cash flows of the Partnership for the three months ended March 31, 2016 and 2015 and the changes in partners’ capital for the Partnership for the three months ended March 31, 2016 . The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make certain estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, expenses and the disclosure of contingent assets and liabilities. Actual results could differ from those estimates. Results of operations and cash flows for the interim periods presented are not necessarily indicative of the results that will be realized for the year ending December 31, 2016 or any other interim or annual period. |
Recent Accounting Pronouncement
Recent Accounting Pronouncements | 3 Months Ended |
Mar. 31, 2016 | |
Accounting Changes and Error Corrections [Abstract] | |
Recent Accounting Pronouncements | (3) Recent Accounting Pronouncements In May 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standard Update ("ASU") No. 2014-09, "Revenue from Contracts with Customers" ("ASU 2014-09"), which requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. The standard was originally effective for interim and annual periods beginning after December 15, 2016 and permits the use of either the retrospective or cumulative effect transition method. Early adoption is not permitted. On July 9, 2015, the FASB approved a one-year deferral of the effective date making the standard effective for interim and annual periods beginning after December 15, 2017. The FASB will continue to permit entities to adopt the standard on the original effective date if they choose. The Partnership has not yet selected a transition method and is currently evaluating the standard and the impact on its consolidated financial statements and footnote disclosures. In April 2015, the FASB issued ASU 2015-03, "Simplifying the Presentation of Debt Issuance Costs" ("ASU 2015-03") . The new standard requires that all costs incurred to issue debt be presented in the balance sheet as a direct deduction from the carrying value of the debt. The standard is effective for interim and annual periods beginning after December 15, 2015 and is required to be applied on a retrospective basis. Early adoption was permitted. The Partnership adopted ASU 2015-03 as of January 1, 2016 and applied the standard retrospectively to the Condensed Consolidated Balance Sheet. Refer to Note 11 ("Credit Facility") for further details. In February 2016, the FASB issued ASU 2016-02, " Leases" ("ASU 2016-02") . The new standard revises accounting for operating leases by a lessee, among other changes, and requires a lessee to recognize a liability to make lease payments and an asset representing its right to use the underlying asset for the lease term in the balance sheet. The standard is effective for the first interim and annual periods beginning after December 15, 2018, with early adoption permitted. At adoption, ASU 2016-02 will be applied using a modified retrospective approach. The Partnership is currently evaluating the standard and the impact on its consolidated financial statements and footnote disclosures. |
Mergers
Mergers | 3 Months Ended |
Mar. 31, 2016 | |
Business Combinations [Abstract] | |
Mergers | (4) Mergers On April 1, 2016, the Partnership completed the previously announced transactions contemplated by the Agreement and Plan of Merger, dated as of August 9, 2015 (the "Merger Agreement"), by and among the Partnership, Lux Merger Sub 1 LLC, a Delaware limited liability company and wholly-owned subsidiary of the Partnership ("Merger Sub 1"), Lux Merger Sub 2 LLC, a Delaware limited liability company and wholly-owned subsidiary of the Partnership ("Merger Sub 2"), East Dubuque Nitrogen Partners, L.P. (formerly known as Rentech Nitrogen Partners, L.P.), a Delaware limited partnership ("East Dubuque"), and East Dubuque Nitrogen GP, LLC (formerly known as Rentech Nitrogen GP, LLC), a Delaware limited liability company ("East Dubuque GP"). Pursuant to the terms and conditions set forth in the Merger Agreement, (i) Merger Sub 1 merged with and into East Dubuque GP, the general partner of East Dubuque, with East Dubuque GP continuing as the surviving entity as a wholly-owned subsidiary of the Partnership, and (ii) Merger Sub 2 merged with and into East Dubuque, with East Dubuque continuing as the surviving entity as a subsidiary of the Partnership (collectively, the "mergers"). East Dubuque was required to sell or spin off its facility located in Pasadena, Texas (the "Pasadena Facility") as a condition to closing of the mergers. On March 14, 2016, East Dubuque completed the sale of 100% of the issued and outstanding membership interests of its subsidiary that owned the Pasadena Facility to a third party. Holders of common units representing limited partner interests in East Dubuque ("East Dubuque common units") of record as of March 28, 2016 received consideration for the Pasadena Facility and may receive additional consideration in the future according to the terms of the purchase agreement. The Partnership will not receive any consideration relating to the sale of the Pasadena Facility. East Dubuque owns a facility located in East Dubuque, Illinois, which produces primarily ammonia and UAN using natural gas as the facility's primary feedstock. The primary reasons for the mergers were to expand the Partnership's geographical footprint, diversify its raw material feedstocks, widen its customer reach and increase its potential for cash-flow generation. In accordance with the FASB’s Accounting Standards Codification ("ASC") Topic 805 — Business Combinations , the Partnership will account for the mergers as an acquisition of a business with CVR Partners as the acquirer. The initial accounting for the business combination is incomplete due to the short period of time since the closing. The Partnership is in the process of determining the allocation of the acquisition date fair values of assets and liabilities assumed. The Partnership expects to include the required disclosures in its second quarter Form 10-Q condensed consolidated financial statements. Merger Consideration Under the terms of the Merger Agreement, holders of East Dubuque common units eligible to receive consideration received 1.04 common units (the "unit consideration") representing limited partner interests in CVR Partners ("CVR Partners common units") and $2.57 in cash, without interest, (the "cash consideration" and together with the unit consideration, the "merger consideration") for each East Dubuque common unit. Pursuant to the Merger Agreement, CVR Partners issued approximately 40.2 million CVR Partners common units and paid approximately $99.2 million in cash consideration to East Dubuque common unitholders and certain holders of East Dubuque phantom units discussed below. Phantom units granted and outstanding under East Dubuque’s equity plans and held by an employee who will continue in the employment of a CVR Partners-affiliated entity upon closing of the mergers were canceled and replaced with new incentive awards of substantially equivalent value and on similar terms. Each phantom unit granted and outstanding and held by (i) an employee who did not continue in employment of a CVR Partners-affiliated entity, or (ii) a director of East Dubuque GP, upon closing of the mergers, vested in full and the holders thereof received the merger consideration. In March 2016, CVR Energy purchased 400,000 East Dubuque common units, representing approximately 1% of the outstanding East Dubuque limited partner interests. Pursuant to the Merger Agreement, any East Dubuque common units held of record by an affiliate of CVR Partners and designated in writing as parent affiliate units remained outstanding as East Dubuque common units following the effective time of the mergers and such affiliate did not receive any merger consideration for those units. As such, CVR Energy did not receive merger consideration for these designated East Dubuque common units. A summary of the total purchase price is as follows: Purchase Price (in thousands) Fair value of CVR Partners common units issued, as of the close of the merger $ 335,693 Cash payment to East Dubuque common unitholders and certain phantom unit holders 99,229 Fair value of consideration transferred 434,922 Fair value of noncontrolling interest for parent affiliate units (1) 4,564 Total purchase price consideration to be allocated $ 439,486 The fair value of the unit consideration was determined as follows: Fair Value of Unit Consideration (in thousands, except per unit data) East Dubuque common units outstanding, as of the close of the merger 38,985 Less: Non-controlling interest from parent affiliate units (1) 400 Net units subject to merger consideration 38,585 Unit consideration per East Dubuque common unit 1.04 Number of CVR Partners common units to be issued for merger consideration 40,129 Number of CVR Partners common units to be issued for East Dubuque phantom units issued to non-continuing employees and East Dubuque board members (2) 26 Total number of CVR Partners units to be issued 40,155 Fair value per CVR Partners common unit, as of the close of the merger $ 8.36 Fair value of CVR Partners common units issued $ 335,693 _____________ (1) See above for discussion of parent affiliate units. (2) As discussed above, each phantom unit granted and outstanding and held by (i) an employee who did not continue in the employment of a CVR Partners-affiliated entity, or (ii) a director of East Dubuque GP, upon closing of the mergers, vested in full and the holders thereof received the merger consideration. Merger-Related Indebtedness East Dubuque’s debt arrangements that remained in place after the closing date of the mergers included $320.0 million of its 6.5% second lien senior secured notes due 2021 (the "Second Lien Notes"). East Dubuque is required under the change of control provision within the indenture governing the Second Lien Notes to offer to purchase, within 90 days of the mergers, all outstanding Second Lien Notes at a price equal to 101% of the principal amount thereof, plus accrued and unpaid interest thereon to the date of purchase. In connection with the closing of the mergers, the Partnership entered into a new senior term loan facility, the proceeds of which may be used by the Partnership or East Dubuque to fund this offer, as discussed further in Note 16 ("Subsequent Events") . Immediately prior to the mergers, East Dubuque had outstanding balances under a credit agreement with Wells Fargo Bank, National Association, as successor-in-interest by assignment from General Electric Company, as administrative agent (the "Wells Fargo Credit Agreement"). The Wells Fargo Credit Agreement consisted of a $50.0 million senior secured revolving credit facility with a $10.0 million letter of credit sublimit. In connection with the closing of the mergers, the Partnership entered into a new senior term loan facility, the proceeds of which were used in part to repay the $49.4 million outstanding balance, accrued interest and fees under the Wells Fargo Credit Agreement and the Wells Fargo Credit Agreement was canceled, as discussed further in Note 16 ("Subsequent Events") . Expenses Associated with the Mergers During the three months ended March 31, 2016 , the Partnership incurred $1.2 million of legal and other professional fees and other merger related expenses, which were included in selling, general and administrative expenses (exclusive of depreciation and amortization). |
Share-Based Compensation
Share-Based Compensation | 3 Months Ended |
Mar. 31, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Share-Based Compensation | (5) Share‑Based Compensation Certain employees of CVR Partners and employees of CVR Energy who perform services for the Partnership under the services agreement with CVR Energy participate in equity compensation plans of CVR Partners' affiliates. Accordingly, CVR Partners has recorded compensation expense for these plans. All compensation expense related to these plans for full-time employees of CVR Partners has been allocated 100% to the Partnership. For employees of CVR Energy, the Partnership records share-based compensation relative to the percentage of time spent by each employee providing services to the Partnership as compared to the total calculated share-based compensation by CVR Energy. The Partnership is not responsible for payment of the allocated share-based compensation for certain plans. Allocated expense amounts related to plans for which the Partnership is not responsible for payment are immaterial and are reflected as an increase or decrease to partners' capital. Long-Term Incentive Plan – CVR Energy CVR Energy has a Long-Term Incentive Plan ("CVR Energy LTIP") that permits the grant of options, stock appreciation rights, restricted shares, restricted stock units, dividend equivalent rights, share awards and performance awards (including performance share units, performance units and performance based restricted stock). As of March 31, 2016 , performance units and an immaterial amount of restricted stock units remain outstanding under the CVR Energy LTIP. Individuals who are eligible to receive awards and grants under the CVR Energy LTIP include CVR Energy’s or its subsidiaries’ (including the Partnership) employees, officers, consultants and directors. Performance Unit Awards In December 2015, CVR Energy entered into a performance unit award agreement (the "2015 Performance Unit Award Agreement") with its Chief Executive Officer. Compensation cost for the 2015 Performance Unit Award Agreement will be recognized over the performance cycle from January 1, 2016 to December 31, 2016. The performance unit award represents the right to receive, upon vesting, a cash payment equal to a defined threshold in accordance with the award agreement, multiplied by a performance factor that is based upon the achievement of certain operating objectives. The Partnership will be responsible for reimbursing CVR Energy for its allocated portion of the performance unit award. Assuming a target performance threshold and that the allocation of costs from CVR Energy remains consistent with the allocation percentages in place at March 31, 2016 , there was approximately $0.3 million of total unrecognized compensation cost related to the 2015 Performance Unit Award Agreement to be recognized over a weighted-average period of approximately 0.8 years . Compensation expense recorded for the three months ended March 31, 2016 related to the awards was approximately $0.1 million . The Partnership will be responsible for reimbursing CVR Energy for its allocated portion of the awards. As of March 31, 2016 , the Partnership had a liability of $0.1 million , for its allocated portion of the 2015 Performance Unit Award Agreement, which is recorded in accrued expenses and other current liabilities on the Condensed Consolidated Balance Sheet. Incentive Unit Awards – CVR Energy CVR Energy has granted awards of incentive units and distribution equivalent rights to certain employees of CRLLC, CVR Energy and the Partnership's general partner who provide shared services to CVR Energy and its subsidiaries (including the Partnership). The awards are generally graded-vesting awards, which are expected to vest over three years, with one-third of the award vesting each year. Compensation expense is recognized on a straight-line basis over the vesting period of the respective tranche of the award. Each incentive unit and distribution equivalent right represents the right to receive, upon vesting, a cash payment equal to (i) the average fair market value of one common unit of CVR Refining, LP ("CVR Refining") in accordance with the award agreement, plus (ii) the per unit cash value of all distributions declared and paid by CVR Refining from the grant date to and including the vesting date. The awards, which are liability-classified, are remeasured at each subsequent reporting date until they vest. Assuming the allocation of costs from CVR Energy remains consistent with the allocation percentages in place at March 31, 2016 , there was approximately $0.9 million of total unrecognized compensation cost related to the incentive units and associated distribution equivalent rights to be recognized over a weighted-average period of approximately 1.5 years. Inclusion of a vesting table would not be meaningful due to changes in allocation percentages that may occur from time to time. The unrecognized compensation expense has been determined by the number of incentive units and respective allocation percentage for individuals for whom, as of March 31, 2016 , compensation expense has been allocated to the Partnership. Compensation expense recorded for the three months ended March 31, 2016 related to the awards was nominal. Compensation expense recorded for the three months ended March 31, 2015 related to the awards was approximately $0.2 million . The Partnership will be responsible for reimbursing CVR Energy for its allocated portion of the awards. As of both March 31, 2016 and December 31, 2015 , the Partnership had a liability of $0.5 million for its allocated portion of non-vested incentive units and associated distribution equivalent rights, which is recorded in accrued expenses and other current liabilities on the Condensed Consolidated Balance Sheets. Long-Term Incentive Plan – CVR Partners The Partnership has a long-term incentive plan ("CVR Partners LTIP") that provides for the grant of options, unit appreciation rights, distribution equivalent rights, restricted units, phantom units and other unit-based awards, each in respect of common units. Individuals eligible to receive awards pursuant to the CVR Partners LTIP include (i) employees of the Partnership and its subsidiaries, (ii) employees of the general partner, (iii) members of the board of directors of the general partner, and (iv) certain CVR Partners' parent's employees, consultants and directors who perform services for the benefit of the Partnership. Through the CVR Partners LTIP, phantom units awards outstanding include awards granted to employees of both the Partnership and the general partner. Phantom unit awards made to employees of the general partner are considered non-employee equity based-awards. The phantom unit awards outstanding vest over a three -year period and are required to be remeasured each reporting period until they vest. The maximum number of common units issuable under the CVR Partners LTIP is 5,000,000 . As of March 31, 2016 , there were 4,820,215 common units available for issuance under the CVR Partners LTIP. As all phantom unit awards discussed below are cash settled awards, they do not reduce the number of common units available for issuance. Certain Units and Phantom Units Awards Awards of phantom units and distribution equivalent rights have been granted to certain employees of the Partnership and its subsidiaries' employees and the employees of the general partner. The awards are generally graded-vesting awards, which are expected to vest over three years with one-third of the award vesting each year. Compensation expense is recognized on a straight-line basis over the vesting period of the respective tranche of the award. Each phantom unit and distribution equivalent right represents the right to receive, upon vesting, a cash payment equal to (i) the average fair market value of one unit of the Partnership's common units in accordance with the award agreement, plus (ii) the per unit cash value of all distributions declared and paid by the Partnership from the grant date to and including the vesting date. The awards, which are liability-classified, are remeasured at each subsequent reporting date until they vest. A summary of the phantom unit activity during the three months ended March 31, 2016 is presented below: Phantom Units Weighted-Average Non-vested at January 1, 2016 391,903 $ 8.71 Granted 3,475 7.77 Vested — — Forfeited — — Non-vested at March 31, 2016 395,378 $ 8.70 Unrecognized compensation expense associated with the unvested phantom units at March 31, 2016 was approximately $2.5 million and is expected to be recognized over a weighted average period of 1.5 years. Compensation expense recorded for the three months ended March 31, 2016 and 2015 related to the awards under the CVR Partners LTIP was approximately $0.5 million and $0.6 million , respectively. Compensation expense related to the awards to employees of the Partnership and its subsidiaries under the CVR Partners LTIP has been recorded in selling, general and administrative expenses (exclusive of depreciation and amortization) - third parties and direct operating expenses (exclusive of depreciation and amortization) - third parties. Compensation expense related to the awards issued to employees of the general partner under the CVR Partners LTIP has been recorded in selling, general and administrative expenses (exclusive of depreciation and amortization) - affiliates and direct operating expenses (exclusive of depreciation and amortization) - affiliates. As of March 31, 2016 and December 31, 2015 the Partnership had a liability of $1.2 million and $0.7 million , respectively, for cash settled non-vested phantom unit awards and associated distribution equivalent rights, which is recorded in personnel accruals on the Condensed Consolidated Balance Sheets. Performance-Based Phantom Unit Award In May 2014, the Partnership entered into a Phantom Unit Agreement with Mark A. Pytosh, the Chief Executive Officer and President of the general partner, that included performance-based phantom units and distribution equivalent rights. Compensation cost for these awards is being recognized over the performance cycles of May 1, 2014 to December 31, 2014, January 1, 2015 to December 31, 2015 and January 1, 2016 to December 31, 2016, as the services are provided. Each phantom unit and distribution equivalent right represents the right to receive, upon vesting, a cash payment equal to (i) the average closing price of the Partnership's common units in accordance with the agreement, multiplied by a performance factor that is based upon the level of the Partnership’s production of UAN, and (ii) the per unit cash value of all distributions declared and paid by the Partnership from the grant date to and including the vesting date. Compensation expense recorded for the three months ended March 31, 2016 and 2015 related to the awards was nominal. Based on current estimates of performance thresholds for the remaining performance cycles, unrecognized compensation expense and the liability associated with the unvested phantom units as of March 31, 2016 and December 31, 2015 were also nominal. |
Inventories
Inventories | 3 Months Ended |
Mar. 31, 2016 | |
Inventory Disclosure [Abstract] | |
Inventories | (6) Inventories Inventories consisted of the following: March 31, December 31, (in thousands) Finished goods $ 5,494 $ 9,589 Raw materials and precious metals 8,101 9,055 Parts and supplies 18,997 18,885 Total inventories $ 32,592 $ 37,529 |
Property, Plant and Equipment
Property, Plant and Equipment | 3 Months Ended |
Mar. 31, 2016 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment | (7) Property, Plant and Equipment A summary of costs and accumulated depreciation for property, plant and equipment is as follows: March 31, December 31, (in thousands) Land and improvements $ 5,441 $ 5,441 Buildings and improvements 3,235 3,049 Machinery and equipment 575,636 574,326 Automotive equipment 483 448 Furniture and fixtures 869 918 Railcars 16,315 16,315 Construction in progress 1,575 1,641 $ 603,554 $ 602,138 Less: Accumulated depreciation 215,919 209,005 Total property, plant and equipment, net $ 387,635 $ 393,133 Capitalized interest recognized as a reduction of interest expense was $0 for the three months ended March 31, 2016 and 2015 . Direct operating expenses excluded depreciation and amortization of approximately $6.8 million and $6.6 million for the three months ended March 31, 2016 and 2015 , respectively. Cost of product sold expenses excluded depreciation and amortization of approximately $0.2 million and $0.2 million for the three months ended March 31, 2016 and 2015 , respectively. Depreciation and amortization excluded from selling, general and administrative expenses was nominal for the three months ended March 31, 2016 and 2015 . |
Partners' Capital and Partnersh
Partners' Capital and Partnership Distributions | 3 Months Ended |
Mar. 31, 2016 | |
Equity [Abstract] | |
Partners' Capital and Partnership Distributions | (8) Partners’ Capital and Partnership Distributions The Partnership has two types of partnership interests outstanding: • common units; and • a general partner interest, which is not entitled to any distributions, and which is held by the general partner. As of March 31, 2016 , the Partnership had a total of 73,128,269 common units issued and outstanding, of which 38,920,000 common units were owned by CRLLC, representing approximately 53% of the total Partnership common units outstanding. As of April 26, 2016 , the Partnership had a total of 113,282,973 common units issued and outstanding, of which 38,920,000 common units were owned by CRLLC, representing approximately 34% of the total Partnership common units outstanding. The board of directors of the Partnership's general partner has a policy for the Partnership to distribute all available cash generated on a quarterly basis. Cash distributions will be made to the common unitholders of record on the applicable record date, generally within 60 days after the end of each quarter. Available cash for each quarter will be determined by the board of directors of the general partner following the end of such quarter. Available cash begins with Adjusted EBITDA reduced for cash needed for (i) net cash interest expense (excluding capitalized interest) and debt service and other contractual obligations; (ii) maintenance capital expenditures; and (iii) to the extent applicable, major scheduled turnaround expenses, reserves for future operating or capital needs that the board of directors of the general partner deems necessary or appropriate, and expenses associated with the East Dubuque mergers, if any. Adjusted EBITDA is defined as EBITDA (net income before interest expense, net, income tax expenses, depreciation and amortization) further adjusted for the impact of non-cash share-based compensation, and, when applicable, major scheduled turnaround expense, loss on disposition of assets and expenses associated with the East Dubuque mergers. Available cash for distribution may be increased by the release of previously established cash reserves, if any, at the discretion of the board of directors of the general partner. Actual distributions are set by the board of directors of the general partner. The board of directors of the general partner may modify the cash distribution policy at any time, and the partnership agreement does not require the board of directors of the general partner to make distributions at all. On March 7, 2016, the Partnership paid a cash distribution to the Partnership's unitholders of record on the close of business on February 29, 2016 for the fourth quarter of 2015 in the amount of $0.27 per common unit, or $19.7 million in aggregate. See Note 16 ("Subsequent Events") for further information on the Partnership's first quarter of 2016 distribution. |
Net Income per Common Unit
Net Income per Common Unit | 3 Months Ended |
Mar. 31, 2016 | |
Earnings Per Share [Abstract] | |
Net Income Per Common Unit | (9) Net Income per Common Unit The Partnership's net income is allocated wholly to the common units, as the general partner does not have an economic interest. Basic and diluted net income per common unit is calculated by dividing net income by the weighted-average number of common units outstanding during the period and, when applicable, gives effect to certain units granted under the CVR Partners LTIP. The common units issued during the period are included on a weighted-average basis for the days in which they were outstanding. |
Accrued Expenses and Other Curr
Accrued Expenses and Other Current Liabilities | 3 Months Ended |
Mar. 31, 2016 | |
Payables and Accruals [Abstract] | |
Accrued Expenses and Other Current Liabilities | (10) Accrued Expenses and Other Current Liabilities Accrued expenses and other current liabilities were as follows: As of As of (in thousands) Property taxes $ 1,764 $ 1,371 Current interest rate swap liabilities — 119 Accrued interest 307 458 Railcar maintenance accruals 325 209 Affiliates (1) 919 2,334 Other accrued expenses and liabilities 1,461 1,192 $ 4,776 $ 5,683 ____________ (1) Accrued expenses and other current liabilities include amounts owed by the Partnership to CVR Energy and its subsidiaries, which are related parties, under the feedstock and shared services agreement and the services agreement. Refer to Note 14 ("Related Party Transactions") for additional discussion. |
Credit Facility
Credit Facility | 3 Months Ended |
Mar. 31, 2016 | |
Debt Disclosure [Abstract] | |
Credit Facility | (11) Credit Facility On April 13, 2011, CRNF, as borrower, and CVR Partners, as guarantor, entered into a new credit facility with a group of lenders including Goldman Sachs Lending Partners LLC, as administrative and collateral agent (the "Credit Agreement"). The Partnership's credit facility includes a term loan facility of $125.0 million and a revolving credit facility of $25.0 million with an uncommitted incremental facility of up to $50.0 million . No amounts were outstanding under the revolving credit facility at March 31, 2016 and December 31, 2015 . There is no scheduled amortization. The credit facility was scheduled to mature on April 13, 2016, but as described below, was prepaid in full and terminated. The principal portion of the term loan is presented as long-term debt on the Condensed Consolidated Balance Sheet as of March 31, 2016 as the Partnership had the intent and ability to refinance the obligation on a long-term basis, as discussed in Note 16 ("Subsequent Events") . Borrowings under the credit facility bear interest at either a Eurodollar rate or a base rate plus in either case a margin based on a pricing grid determined by the trailing four quarter leverage ratio. The margin for borrowings under the credit facility ranges from 3.50% to 4.25% for Eurodollar loans and 2.50% to 3.25% for base rate loans. During the periods presented, the interest rate was either the Eurodollar rate plus a margin of 3.50% or, for base rate loans, the prime rate plus 2.50% . At March 31, 2016 , the effective rate of the term loan facility was approximately 3.98% . Under its terms, the lenders under the credit facility were granted a first priority security interest (subject to certain customary exceptions) in substantially all of the assets of CVR Partners and CRNF. The Partnership previously incurred debt issuance costs associated with the term loan facility. As discussed in Note 3 ("Recent Accounting Pronouncements") , the Partnership adopted ASU 2015-03, " Simplifying the Presentation of Debt Issuance Costs ", which requires that all costs incurred to issue debt be presented in the balance sheet as a direct deduction from the carrying value of the debt. As a result of adoption of the standard, debt issuance costs were reclassified as a direct deduction from the carrying value of the related debt balances in the Condensed Consolidated Balance Sheets. Debt issuance costs related to the revolving credit facility continue to be presented as assets in the Condensed Consolidated Balance Sheets. A summary of the carrying value of long-term debt in the Condensed Consolidated Balance Sheets as of March 31, 2016 and December 31, 2015 is as follows: As of As of (in thousands) Term loan facility $ 125,000 $ 125,000 Less: Deferred financing fees 26 227 Long-term debt, net of current portion $ 124,974 $ 124,773 As discussed in Note 16 ("Subsequent Events") , subsequent to March 31, 2016, the Partnership repaid all amounts outstanding under the Credit Agreement and the Credit Agreement was terminated. |
Interest Rate Swap Agreements
Interest Rate Swap Agreements | 3 Months Ended |
Mar. 31, 2016 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Interest Rate Swap Agreements | (12) Interest Rate Swap Agreements CRNF had two floating-to-fixed interest rate swap agreements for the purpose of hedging the interest rate risk associated with a portion of its $125.0 million floating rate term debt, which expired on February 12, 2016. The floating rate term debt is discussed in Note 11 ("Credit Facility") . The aggregate notional amount covered under these agreements, which commenced on August 12, 2011, totals $62.5 million (split evenly between the two agreements). Under the terms of the interest rate swap agreement entered into on June 30, 2011, CRNF received a floating rate based on three-month LIBOR and paid a fixed rate of 1.94% . Under the terms of the interest rate swap agreement entered into on July 1, 2011, CRNF receives a floating rate based on three-month LIBOR and paid a fixed rate of 1.975% . Both swap agreements were settled every 90 days . The effect of these swap agreements was to lock in a fixed rate of interest of approximately 1.96% plus the applicable margin paid to lenders over three-month LIBOR governed by the credit facility. The agreements were designated as cash flow hedges at inception, and accordingly, the effective portion of the gain or loss on the swap was reported as a component of accumulated other comprehensive income ("AOCI") and reclassified into interest expense when the interest rate swap transaction affects earnings. Any ineffective portion of the gain or loss was recognized immediately in interest expense. The realized loss on the interest rate swap reclassified from AOCI into interest expense and other financing costs on the Condensed Consolidated Statements of Operations was $0.1 million and $0.3 million for the three months ended March 31, 2016 and 2015 , respectively. The interest rate swap agreements previously held by the Partnership also provided for the right to offset. However, as the interest rate swaps were in a liability position, there are no amounts offset in the Condensed Consolidated Balance Sheet as of December 31, 2015 . See Note 15 ("Fair Value Measurements") for discussion of the fair value of the interest rate swap agreements. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | (13) Commitments and Contingencies Leases and Unconditional Purchase Obligations The minimum required payments for the Partnership’s operating leases and unconditional purchase obligations are as follows: Operating Leases Unconditional Purchase Obligations (in thousands) Nine months ending December 31, 2016 $ 3,616 $ 14,908 Year Ending December 31, 2017 3,307 14,640 2018 2,496 13,172 2019 1,897 11,452 2020 1,403 9,073 Thereafter 2,257 54,415 $ 14,976 $ 117,660 _____________ CRNF leases railcars and facilities under long-term operating leases. Lease expense included in cost of product sold (exclusive of depreciation and amortization) and for the three months ended March 31, 2016 and 2015 totaled approximately $1.2 million and $1.1 million , respectively. The lease agreements have various remaining terms. Some agreements are renewable, at CRNF’s option, for additional periods. It is expected, in the ordinary course of business, that leases may be renewed or replaced as they expire. The Partnership’s purchase obligation for pet coke from CVR Refining and has been derived from a calculation of the average pet coke price paid to CVR Refining over the preceding two year period. See Note 14 ("Related Party Transactions") for further discussion of the coke supply agreement. CRNF is party to the Amended and Restated On-Site Product Supply Agreement with The BOC Group, Inc. (as predecessor in interest to Linde LLC). Pursuant to the agreement, which expires in 2020, CRNF is required to take as available and pay for the supply of oxygen and nitrogen to the fertilizer operation. Expenses associated with this agreement are included in direct operating expenses (exclusive of depreciation and amortization), and, for the three months ended March 31, 2016 and 2015 , totaled approximately $1.0 million and $0.8 million , respectively. The Partnership is a party to a pet coke supply agreement with HollyFrontier Corporation. The term of this agreement ends in December 2016 . The delivered cost of this pet coke is included in cost of product sold (exclusive of depreciation and amortization) and totaled approximately $1.4 million and $1.3 million , respectively, for the three months ended March 31, 2016 and 2015 . Litigation From time to time, the Partnership is involved in various lawsuits arising in the normal course of business, including environmental, health and safety ("EHS") matters described below under "Environmental, Health and Safety Matters." Liabilities, if any, related to such litigation are recognized when the related costs are probable and can be reasonably estimated. These provisions are reviewed at least quarterly and adjusted to reflect the impacts of negotiations, settlements, rulings, advice of legal counsel and other information and events pertaining to a particular case. It is possible that management’s estimates of the outcomes will change within the next year due to uncertainties inherent in litigation and settlement negotiations. There were no new proceedings or material developments in proceedings from those provided in the 2015 Form 10-K, which was filed with the SEC on February 18, 2016. In the opinion of management, the ultimate resolution of any other litigation matters is not expected to have a material adverse effect on the accompanying condensed consolidated financial statements. There can be no assurance that management’s beliefs or opinions with respect to liability for potential litigation matters are accurate. Environmental, Health and Safety Matters CRNF is subject to various stringent federal, state and local EHS rules and regulations. Liabilities related to EHS matters are recognized when the related costs are probable and can be reasonably estimated. Estimates of these costs are based upon currently available facts, existing technology, site-specific costs and currently enacted laws and regulations. In reporting EHS liabilities, no offset is made for potential recoveries. All liabilities are monitored and adjusted regularly as new facts emerge or changes in laws or technology occur. There have been no new developments or material changes to the environmental accruals or expected capital expenditures related to compliance with the foregoing environmental matters from those provided in the 2015 Form 10-K. CRNF believes it is in substantial compliance with existing EHS rules and regulations. There can be no assurance that the EHS matters which may develop in the future will not have a material adverse effect on the Partnership's business, financial condition or results of operations. |
Related Party Transactions
Related Party Transactions | 3 Months Ended |
Mar. 31, 2016 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | (14) Related Party Transactions Related Party Agreements CVR Partners is party to, or otherwise subject to certain agreements with CVR Energy and its subsidiaries (including CVR Refining and its subsidiary Coffeyville Resources Refining & Marketing, LLC ("CRRM")) that govern the business relations among each party including: the (i) Feedstock and Shared Services Agreement; (ii) Coke Supply Agreement; (iii) Environmental Agreement; (iv) Services Agreement; (v) GP Services Agreement and (vi) Limited Partnership Agreement. The agreements are described as in effect at March 31, 2016 . Except as otherwise described below, there have been no new developments or material changes to these agreements from those provided in the 2015 Form 10-K. Amounts owed to CVR Partners and CRNF from CVR Energy and its subsidiaries with respect to these agreements are included in prepaid expenses and other current assets and other long-term assets on the Condensed Consolidated Balance Sheets. Conversely, amounts owed to CVR Energy and its subsidiaries by CVR Partners and CRNF with respect to these agreements are included in accounts payable, personnel accruals and accrued expenses and other current liabilities on the Partnership's Condensed Consolidated Balance Sheets. Feedstock and Shared Services Agreement CRNF is party to a feedstock and shared services agreement with CRRM under which the two parties provide feedstock and other services to one another. These feedstocks and services are utilized in the respective production processes of CRRM's Coffeyville, Kansas refinery and CRNF's nitrogen fertilizer plant. Pursuant to the feedstock and shared services agreement, CRNF and CRRM have agreed to transfer hydrogen to one another; provided, CRNF is not required to sell hydrogen to CRRM if such hydrogen is required for operation of CRNF's nitrogen fertilizer plant, if such sale would adversely affect the Partnership's classification as a partnership for federal income tax purposes, or if such sale would not be in CRNF's best interest. Net monthly sales of hydrogen to CRRM have been reflected as net sales for CVR Partners, when applicable. Net monthly receipts of hydrogen from CRRM have been reflected in cost of product sold (exclusive of depreciation and amortization) for CVR Partners, when applicable. For the three months ended March 31, 2016 and 2015 , the net sales generated from the sale of hydrogen to CRRM were approximately $1.1 million and $6.5 million , respectively. At March 31, 2016 , there was a nominal amount included in accounts payable on the Condensed Consolidated Balance Sheets associated with unpaid balances related to hydrogen sales. At December 31, 2015 , there was approximately $0.5 million of receivables included in prepaid expenses and other current assets on the Condensed Consolidated Balance Sheets associated with unpaid balances related to hydrogen sales. CRNF is also obligated to make available to CRRM any nitrogen produced by the Linde air separation plant that is not required for the operation of the nitrogen fertilizer plant, as determined by CRNF in a commercially reasonable manner. Reimbursed direct operating expenses associated with nitrogen for the three months ended March 31, 2016 was $0 . Reimbursed direct operating expenses associated with nitrogen for the three months ended March 31, 2015 was nominal. The agreement also provides a mechanism pursuant to which CRNF transfers a tail gas stream to CRRM. CRNF receives the benefit of eliminating a waste gas stream and recovers the fuel value of the tail gas system. For the three months ended March 31, 2016 and 2015 , the net sales generated from the sale of tail gas to CRRM were nominal. In April 2011, in connection with the tail gas stream transfers to CRRM, CRRM installed a pipe between the Coffeyville, Kansas refinery and the nitrogen fertilizer plant to transfer the tail gas. CRNF agreed to pay CRRM the cost of installing the pipe and provide an additional 15% to cover the cost of capital, which was due from CRNF to CRRM over four years . At March 31, 2016 and December 31, 2015 , there were assets of approximately $0.2 million and $0.2 million , respectively, included in prepaid expenses and other current assets and approximately $0.7 million and $0.8 million , respectively, included in other long-term assets in the Condensed Consolidated Balance Sheets. At March 31, 2016 and December 31, 2015 , receivables of nominal amounts and $0.2 million , respectively, were included in prepaid expenses and other current assets on the Condensed Consolidated Balance Sheets for amounts yet to be received related to components of the feedstock and shared services agreement, other than amounts related to hydrogen transfers and tail gas discussed above. At March 31, 2016 and December 31, 2015 , current obligations of approximately $0.6 million and $0.7 million , respectively, were included in accounts payable on the Condensed Consolidated Balance Sheets associated with unpaid balances related to components of the feedstock and shared services agreement. Coke Supply Agreement CRNF is party to a coke supply agreement with CRRM pursuant to which CRRM supplies CRNF with pet coke. This agreement provides that CRRM must deliver to CRNF during each calendar year an annual required amount of pet coke equal to the lesser of (i) 100 percent of the pet coke produced at CRRM's Coffeyville, Kansas petroleum refinery or (ii) 500,000 tons of pet coke. CRNF is also obligated to purchase this annual required amount. If during a calendar month CRRM produces more than 41,667 tons of pet coke, then CRNF will have the option to purchase the excess at the purchase price provided for in the agreement. If CRNF declines to exercise this option, CRRM may sell the excess to a third party. CRNF obtains most (over 70% on average during the last five years ) of the pet coke it needs from CRRM's adjacent crude oil refinery pursuant to the pet coke supply agreement, and procures the remainder through a contract with HollyFrontier Corporation and on the open market. The price CRNF pays pursuant to the pet coke supply agreement is based on the lesser of a pet coke price derived from the price received for UAN (the "UAN-based price") or a pet coke price index. The UAN-based price begins with a pet coke price of $25 per ton based on a price per ton for UAN that excludes transportation cost ("netback price") of $205 per ton, and adjusts up or down $0.50 per ton for every $1.00 change in the netback price. The UAN-based price has a ceiling of $40 per ton and a floor of $5 per ton. CRNF will pay any taxes associated with the sale, purchase, transportation, delivery, storage or consumption of the pet coke. CRNF is entitled to offset any amount payable for the pet coke against any amount due from CRRM under the feedstock and shared services agreement between the parties. The cost of pet coke associated with the transfer of pet coke from CRRM to CRNF were approximately $0.7 million and $1.8 million for the three months ended March 31, 2016 and 2015 , respectively, which was recorded in cost of product sold (exclusive of depreciation and amortization). Payables of $0.1 million and $0.3 million related to the coke supply agreement were included in accounts payable on the Condensed Consolidated Balance Sheets at March 31, 2016 and December 31, 2015 , respectively. Services Agreement CVR Partners obtains certain management and other services from CVR Energy pursuant to a services agreement between the Partnership, CVR GP and CVR Energy. Net amounts incurred under the services agreement for the three months ended March 31, 2016 and 2015 were as follows: Three Months Ended 2016 2015 (in thousands) Direct operating expenses (exclusive of depreciation and amortization) — Affiliates $ 665 $ 890 Selling, general and administrative expenses (exclusive of depreciation and amortization) — Affiliates 2,563 2,384 Total $ 3,228 $ 3,274 For services performed in connection with the services agreement, the Partnership recognized personnel costs, excluding amounts related to share-based compensation that are disclosed in Note 5 ("Share‑Based Compensation") , of $1.4 million and $1.1 million , respectively, for the three months ended March 31, 2016 and 2015 . At March 31, 2016 and December 31, 2015 , current obligations of $1.8 million and $3.2 million , respectively, were included in accounts payable and accrued expenses and other current liabilities on the Condensed Consolidated Balance Sheets with respect to amounts billed in accordance with the services agreement. Limited Partnership Agreement The partnership agreement provides that the Partnership will reimburse its general partner for all direct and indirect expenses it incurs or payments it makes on behalf of the Partnership (including salary, bonus, incentive compensation and other amounts paid to any person to perform services for the Partnership or for its general partner in connection with operating the Partnership). The Partnership reimbursed its general partner for the three months ended March 31, 2016 and 2015 approximately $1.1 million and $1.1 million , respectively, pursuant to the partnership agreement primarily for personnel costs related to the compensation of executives at the general partner, who manage the Partnership's business. At March 31, 2016 and December 31, 2015 , current obligations of $1.2 million and $2.0 million , respectively, were included in personnel accruals on the Condensed Consolidated Balance Sheets related to amounts outstanding in accordance with the limited partnership agreement. Insight Portfolio Group Insight Portfolio Group LLC ("Insight Portfolio Group") is an entity formed by Mr. Carl C. Icahn in order to maximize the potential buying power of a group of entities with which Mr. Icahn has a relationship in negotiating with a wide range of suppliers of goods, services and tangible and intangible property at negotiated rates. In January 2013, CVR Energy acquired a minority equity interest in Insight Portfolio Group. The Partnership participates in Insight Portfolio Group’s buying group through its relationship with CVR Energy. The Partnership may purchase a variety of goods and services as members of the buying group at prices and on terms that management believes would be more favorable than those which would be achieved on a stand-alone basis. For the three months ended March 31, 2016 , the Partnership paid Insight Portfolio Group approximately $0.1 million . For the three months ended March 31, 2015 , the Partnership paid Insight Portfolio Group a nominal amount. At March 31, 2016 and December 31, 2015 , there were no unpaid balances related to transactions with the Insight Portfolio Group. Commitment Letter Simultaneously with the execution of the Merger Agreement, CVR Partners entered into a commitment letter (the "Commitment Letter") with CRLLC, pursuant to which CRLLC has committed to, on the terms and subject to the conditions set forth in the Commitment Letter, make available to CVR Partners term loan financing of up to $150.0 million , which amounts would be available solely to fund the repayment of all of the loans outstanding under the Wells Fargo Credit Agreement, the cash consideration and expenses associated with the mergers. The term loan facility, if drawn, would have a one year term and would bear interest at a rate of three-month LIBOR plus 3.0% per annum. Calculation of interest would be on the basis of the actual number of days elapsed over a 360 -day year. CRLLC Guaranty On February 9, 2016, CRLLC and the Partnership entered into a guaranty (the "CRLLC Guaranty"), pursuant to which CRLLC agreed to guaranty the indebtedness outstanding under the Credit Agreement. If the credit facility became due prior to a refinancing by the Partnership, CRLLC would be required to pay the indebtedness pursuant to the guaranty. The Partnership's obligation to repay CRLLC for the indebtedness would be pursuant to a promissory note (the "Note"). The terms of the Note would be mutually agreed upon by the parties, provided, the term would be the lesser of two years or such time that the Partnership obtains third-party financing ("New Debt") of at least $125.0 million on terms acceptable to the Partnership with a term of greater than one year from the inception of the New Debt. Related Party Subsequent Events See Note 16 ("Subsequent Events") for discussion of related party transactions, including termination of the Commitment Letter and CRLLC Guaranty, subsequent to March 31, 2016. |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Mar. 31, 2016 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | (15) Fair Value Measurements In accordance with ASC Topic 820 — Fair Value Measurements and Disclosures ("ASC 820"), the Partnership utilizes the market approach to measure fair value for its financial assets and liabilities. The market approach uses prices and other relevant information generated by market transactions involving identical or comparable assets, liabilities or a group of assets or liabilities, such as a business. ASC 820 utilizes a 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 — Quoted prices in active markets for identical assets and liabilities • Level 2 — Other significant observable inputs (including quoted prices in active markets for similar assets or liabilities) • Level 3 — Significant unobservable inputs (including the Partnership’s own assumptions in determining the fair value). There were no assets or liabilities measured at fair value on a recurring basis as of March 31, 2016 . The following table sets forth the assets and liabilities measured at fair value on a recurring basis, by input level, as of December 31, 2015 . December 31, 2015 Level 1 Level 2 Level 3 Total (in thousands) Financial Statement Caption and Description Other current liabilities (interest rate swaps) $ — $ 119 $ — $ 119 The carrying value of the Partnership’s debt approximates fair value. The Partnership had interest rate swaps that were measured at fair value on a recurring basis using Level 2 inputs. The swaps expired in February 2016. See further discussion in Note 12 (" Interest Rate Swap Agreements "). The fair values of these interest rate swap instruments were based on discounted cash flow models that incorporated the cash flows of the derivatives, as well as the current LIBOR rate and a forward LIBOR curve, along with other observable market inputs. |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2016 | |
Subsequent Events [Abstract] | |
Subsequent Events | (16) Subsequent Events Distribution On April 27, 2016 , the Board of Directors of the general partner of the Partnership declared a cash distribution for the first quarter of 2016 in the amount of $0.27 per common unit, or approximately $30.6 million in aggregate. The cash distribution will be paid on May 16, 2016 to the Partnership's unitholders of record at the close of business on May 9, 2016 . Mergers See Note 4 ("Mergers") for discussion of the mergers with East Dubuque and East Dubuque GP, completed on April 1, 2016. CRLLC Facility On April 1, 2016, in connection with the closing of the mergers, the Partnership entered into a $300.0 million senior term loan credit facility (the "CRLLC Facility") with CRLLC, as the lender, the proceeds of which were used by the Partnership (i) to fund the repayment of amounts outstanding under the Wells Fargo Credit Agreement discussed in Note 4 ("Mergers") (ii) to pay the cash consideration and to pay fees and expenses in connection with the mergers and related transactions and (iii) to repay all of the loans outstanding under the Credit Agreement discussed in Note 11 ("Credit Facility") . The CRLLC Facility has a term of two years and bears an interest rate of 12.0% per annum. Interest is calculated on the basis of the actual number of days elapsed over a 360 -day year and payable quarterly. The Partnership may voluntarily prepay in whole or in part the borrowings under the CRLLC Facility without premium or penalty. In April 2016, the Partnership borrowed $300.0 million under the CRLLC Facility. In connection with the CRLLC Facility, the Commitment Letter and the CRLLC Guaranty discussed in Note 14 ("Related Party Transactions") were terminated. AEPC Facility On April 1, 2016, in connection with the closing of the mergers, the Partnership entered into a new $320.0 million senior term loan facility (the "AEPC Facility") with American Entertainment Properties Corp., a Delaware corporation and an affiliate of the Partnership ("AEPC"), as the lender, which (i) may be used by the Partnership to provide funds to East Dubuque to make a change of control offer and, if applicable, a "clean-up" redemption in accordance with the indenture governing the Second Lien Notes or (ii) may be used by the Partnership or East Dubuque to make a tender offer for the Second Lien Notes and, in each case, pay fees and expenses related thereto. The AEPC Facility is for a term of two years and bears interest at a rate of 12% per annum. Interest shall be calculated on the basis of the actual number of days elapsed over a 360 -day year and payable quarterly. The Partnership may voluntarily prepay in whole or in part the borrowings under the AEPC Facility without premium or penalty. Credit Agreement On April 1, 2016, in connection with the completion of the mergers, the Partnership repaid all amounts outstanding under the Credit Agreement. Effective upon such repayment, the Credit Agreement and all related loan documents and security interests were terminated and released. The Credit Agreement is discussed further in Note 11 ("Credit Facility") . The repayment was funded from amounts drawn on the CRLLC Facility, as discussed above. |
Basis of Presentation (Policies
Basis of Presentation (Policies) | 3 Months Ended |
Mar. 31, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | The accompanying Partnership condensed consolidated financial statements include the accounts of CVR Partners and its subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. The accompanying condensed consolidated financial statements were prepared in accordance with U.S. generally accepted accounting principles ("GAAP") and in accordance with the rules and regulations of the Securities and Exchange Commission ("SEC"). These condensed consolidated financial statements should be read in conjunction with the December 31, 2015 audited consolidated financial statements and notes thereto included in CVR Partners’ Annual Report on Form 10-K for the year ended December 31, 2015 , which was filed with the SEC on February 18, 2016 (the "2015 Form 10-K"). The condensed consolidated financial statements include certain selling, general and administrative expenses and direct operating expenses that CVR Energy and its subsidiaries incurred on behalf of the Partnership. These related party transactions are governed by the services agreement. See Note 14 ("Related Party Transactions") for additional discussion of the services agreement and billing and allocation of certain costs. In the opinion of the Partnership’s management, the accompanying condensed consolidated financial statements and related notes reflect all adjustments (consisting only of normal recurring adjustments) that are necessary to fairly present the financial position of the Partnership as of March 31, 2016 and December 31, 2015 , the results of operations and comprehensive income of the Partnership for the three months ended March 31, 2016 and 2015 , the cash flows of the Partnership for the three months ended March 31, 2016 and 2015 and the changes in partners’ capital for the Partnership for the three months ended March 31, 2016 . The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make certain estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, expenses and the disclosure of contingent assets and liabilities. Actual results could differ from those estimates. Results of operations and cash flows for the interim periods presented are not necessarily indicative of the results that will be realized for the year ending December 31, 2016 or any other interim or annual period. |
Recent Accounting Pronouncements | In May 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standard Update ("ASU") No. 2014-09, "Revenue from Contracts with Customers" ("ASU 2014-09"), which requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. The standard was originally effective for interim and annual periods beginning after December 15, 2016 and permits the use of either the retrospective or cumulative effect transition method. Early adoption is not permitted. On July 9, 2015, the FASB approved a one-year deferral of the effective date making the standard effective for interim and annual periods beginning after December 15, 2017. The FASB will continue to permit entities to adopt the standard on the original effective date if they choose. The Partnership has not yet selected a transition method and is currently evaluating the standard and the impact on its consolidated financial statements and footnote disclosures. In April 2015, the FASB issued ASU 2015-03, "Simplifying the Presentation of Debt Issuance Costs" ("ASU 2015-03") . The new standard requires that all costs incurred to issue debt be presented in the balance sheet as a direct deduction from the carrying value of the debt. The standard is effective for interim and annual periods beginning after December 15, 2015 and is required to be applied on a retrospective basis. Early adoption was permitted. The Partnership adopted ASU 2015-03 as of January 1, 2016 and applied the standard retrospectively to the Condensed Consolidated Balance Sheet. Refer to Note 11 ("Credit Facility") for further details. In February 2016, the FASB issued ASU 2016-02, " Leases" ("ASU 2016-02") . The new standard revises accounting for operating leases by a lessee, among other changes, and requires a lessee to recognize a liability to make lease payments and an asset representing its right to use the underlying asset for the lease term in the balance sheet. The standard is effective for the first interim and annual periods beginning after December 15, 2018, with early adoption permitted. At adoption, ASU 2016-02 will be applied using a modified retrospective approach. The Partnership is currently evaluating the standard and the impact on its consolidated financial statements and footnote disclosures. |
Mergers (Tables)
Mergers (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Business Combinations [Abstract] | |
Schedule of business acquisition | A summary of the total purchase price is as follows: Purchase Price (in thousands) Fair value of CVR Partners common units issued, as of the close of the merger $ 335,693 Cash payment to East Dubuque common unitholders and certain phantom unit holders 99,229 Fair value of consideration transferred 434,922 Fair value of noncontrolling interest for parent affiliate units (1) 4,564 Total purchase price consideration to be allocated $ 439,486 The fair value of the unit consideration was determined as follows: Fair Value of Unit Consideration (in thousands, except per unit data) East Dubuque common units outstanding, as of the close of the merger 38,985 Less: Non-controlling interest from parent affiliate units (1) 400 Net units subject to merger consideration 38,585 Unit consideration per East Dubuque common unit 1.04 Number of CVR Partners common units to be issued for merger consideration 40,129 Number of CVR Partners common units to be issued for East Dubuque phantom units issued to non-continuing employees and East Dubuque board members (2) 26 Total number of CVR Partners units to be issued 40,155 Fair value per CVR Partners common unit, as of the close of the merger $ 8.36 Fair value of CVR Partners common units issued $ 335,693 _____________ (1) See above for discussion of parent affiliate units. (2) As discussed above, each phantom unit granted and outstanding and held by (i) an employee who did not continue in the employment of a CVR Partners-affiliated entity, or (ii) a director of East Dubuque GP, upon closing of the mergers, vested in full and the holders thereof received the merger consideration. |
Share-Based Compensation (Table
Share-Based Compensation (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Summary of the phantom units activity | A summary of the phantom unit activity during the three months ended March 31, 2016 is presented below: Phantom Units Weighted-Average Non-vested at January 1, 2016 391,903 $ 8.71 Granted 3,475 7.77 Vested — — Forfeited — — Non-vested at March 31, 2016 395,378 $ 8.70 |
Inventories (Tables)
Inventories (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Inventory Disclosure [Abstract] | |
Schedule of inventories | Inventories consisted of the following: March 31, December 31, (in thousands) Finished goods $ 5,494 $ 9,589 Raw materials and precious metals 8,101 9,055 Parts and supplies 18,997 18,885 Total inventories $ 32,592 $ 37,529 |
Property, Plant and Equipment (
Property, Plant and Equipment (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Property, Plant and Equipment [Abstract] | |
Summary of costs for property, plant, and equipment | A summary of costs and accumulated depreciation for property, plant and equipment is as follows: March 31, December 31, (in thousands) Land and improvements $ 5,441 $ 5,441 Buildings and improvements 3,235 3,049 Machinery and equipment 575,636 574,326 Automotive equipment 483 448 Furniture and fixtures 869 918 Railcars 16,315 16,315 Construction in progress 1,575 1,641 $ 603,554 $ 602,138 Less: Accumulated depreciation 215,919 209,005 Total property, plant and equipment, net $ 387,635 $ 393,133 |
Accrued Expenses and Other Cu29
Accrued Expenses and Other Current Liabilities (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Payables and Accruals [Abstract] | |
Schedule of accrued expenses and other current liabilities | Accrued expenses and other current liabilities were as follows: As of As of (in thousands) Property taxes $ 1,764 $ 1,371 Current interest rate swap liabilities — 119 Accrued interest 307 458 Railcar maintenance accruals 325 209 Affiliates (1) 919 2,334 Other accrued expenses and liabilities 1,461 1,192 $ 4,776 $ 5,683 ____________ (1) Accrued expenses and other current liabilities include amounts owed by the Partnership to CVR Energy and its subsidiaries, which are related parties, under the feedstock and shared services agreement and the services agreement. Refer to Note 14 ("Related Party Transactions") for additional discussion. |
Credit Facility (Tables)
Credit Facility (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Debt Disclosure [Abstract] | |
Schedule of debt | A summary of the carrying value of long-term debt in the Condensed Consolidated Balance Sheets as of March 31, 2016 and December 31, 2015 is as follows: As of As of (in thousands) Term loan facility $ 125,000 $ 125,000 Less: Deferred financing fees 26 227 Long-term debt, net of current portion $ 124,974 $ 124,773 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of minimum required payments for operating leases and unconditional purchase obligations | The minimum required payments for the Partnership’s operating leases and unconditional purchase obligations are as follows: Operating Leases Unconditional Purchase Obligations (in thousands) Nine months ending December 31, 2016 $ 3,616 $ 14,908 Year Ending December 31, 2017 3,307 14,640 2018 2,496 13,172 2019 1,897 11,452 2020 1,403 9,073 Thereafter 2,257 54,415 $ 14,976 $ 117,660 _____________ |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Related Party Transactions [Abstract] | |
Schedule of related party transactions | Net amounts incurred under the services agreement for the three months ended March 31, 2016 and 2015 were as follows: Three Months Ended 2016 2015 (in thousands) Direct operating expenses (exclusive of depreciation and amortization) — Affiliates $ 665 $ 890 Selling, general and administrative expenses (exclusive of depreciation and amortization) — Affiliates 2,563 2,384 Total $ 3,228 $ 3,274 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Fair Value Disclosures [Abstract] | |
Schedule of assets and liabilities measured at fair value on a recurring basis | The following table sets forth the assets and liabilities measured at fair value on a recurring basis, by input level, as of December 31, 2015 . December 31, 2015 Level 1 Level 2 Level 3 Total (in thousands) Financial Statement Caption and Description Other current liabilities (interest rate swaps) $ — $ 119 $ — $ 119 |
Formation of the Partnership,34
Formation of the Partnership, Organization and Nature of Business (Details) | Apr. 26, 2016 | Apr. 01, 2016 | Mar. 31, 2016 |
Formation of the Partnership, Organization and Nature of Business | |||
Percentage of limited partner interest held by the public | 47.00% | ||
CRLLC | |||
Formation of the Partnership, Organization and Nature of Business | |||
Limited partner interest (as a percent) | 53.00% | ||
General partner interest (as a percent) | 100.00% | ||
CRLLC | Subsequent Event | |||
Formation of the Partnership, Organization and Nature of Business | |||
Limited partner interest (as a percent) | 34.00% | 34.00% | |
General partner interest (as a percent) | 100.00% | ||
IEP Energy LLC | CVR Energy, Inc | |||
Formation of the Partnership, Organization and Nature of Business | |||
Aggregate ownership percentage | 82.00% |
Mergers - Additional Informatio
Mergers - Additional Information (Details) - USD ($) | Apr. 01, 2016 | Mar. 31, 2016 | Mar. 14, 2016 |
CVR Energy, Inc | |||
Business Acquisition [Line Items] | |||
Units purchased (in units) | 400,000 | ||
Subsequent Event | Senior Notes | East Dubuque | Second Lien Notes due 2021 | |||
Business Acquisition [Line Items] | |||
Debt instrument, carrying amount | $ 320,000,000 | ||
Debt instrument, percentage rate | 6.50% | ||
Period to repurchase debt | 90 days | ||
Redemption price (as a percent) | 101.00% | ||
Subsequent Event | Line of Credit | Wells Fargo Credit Agreement | |||
Business Acquisition [Line Items] | |||
Repayments of debt | $ 49,400,000 | ||
Subsequent Event | Term Loan | Line of Credit | East Dubuque | Wells Fargo Credit Agreement | |||
Business Acquisition [Line Items] | |||
Borrowing capacity | 50,000,000 | ||
Subsequent Event | Letter of Credit | Line of Credit | East Dubuque | Wells Fargo Credit Agreement | |||
Business Acquisition [Line Items] | |||
Borrowing capacity | $ 10,000,000 | ||
East Dubuque | CVR Energy, Inc | |||
Business Acquisition [Line Items] | |||
Limited partner interest (as a percent) | 1.00% | ||
East Dubuque Merger | |||
Business Acquisition [Line Items] | |||
Merger related expenses | $ 1,200,000 | ||
East Dubuque Merger | Subsequent Event | |||
Business Acquisition [Line Items] | |||
CVR Partners common units eligible per East Dubuque common unit (in units) | 1.04 | ||
Expected issuance of common units (in units) | 40,155,000 | ||
Cash payment to East Dubuque common unitholders and certain phantom unit holders | $ 99,229,000 | ||
East Dubuque Merger | Subsequent Event | East Dubuque | |||
Business Acquisition [Line Items] | |||
CVR Partners common units eligible per East Dubuque common unit (in units) | 1.04 | ||
Unit price (in dollars per unit) | $ 2.57 | ||
Disposed of by Sale | East Dubuque | |||
Business Acquisition [Line Items] | |||
Ownership interest sold | 100.00% |
Mergers - Schedule of Total Pur
Mergers - Schedule of Total Purchase Price (Details) - East Dubuque Merger - Subsequent Event $ in Thousands | Apr. 01, 2016USD ($) |
Business Acquisition [Line Items] | |
Fair value of CVR Partners common units issued, as of the close of the merger | $ 335,693 |
Cash payment to East Dubuque common unitholders and certain phantom unit holders | 99,229 |
Fair value of consideration transferred | 434,922 |
Fair value of noncontrolling interest for parent affiliate units | 4,564 |
Total purchase price consideration to be allocated | $ 439,486 |
Mergers - Schedule of Unit Cons
Mergers - Schedule of Unit Consideration Fair Value (Details) - East Dubuque Merger - Subsequent Event $ / shares in Units, $ in Thousands | Apr. 01, 2016USD ($)$ / sharesshares |
Business Acquisition [Line Items] | |
East Dubuque common units outstanding, as of the close of the merger (in units) | 38,985,000 |
Less: Non-controlling interest from parent affiliate units (in units) | 400,000 |
Net units subject to merger consideration (in units) | 38,585,000 |
Unit consideration per East Dubuque common unit (in units) | 1.04 |
Number of CVR Partners common units to be issued for merger consideration (in units) | 40,129,000 |
Number of CVR Partners common units to be issued for East Dubuque phantom units issued to non-continuing employees and East Dubuque board members (in units) | 26,000 |
Total number of CVR Partners units to be issued (in units) | 40,155,000 |
Fair value per CVR Partners common unit, as of the close of the merger (in dollars per unit) | $ / shares | $ 8.36 |
Fair value of CVR Partners common units issued | $ | $ 335,693 |
Share-Based Compensation - Ince
Share-Based Compensation - Incentive Plan and Awards, CVR Energy (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2016 | Mar. 31, 2015 | Dec. 31, 2015 | |
Share-Based Compensation | |||
Percentage of allocation of share-based compensation expense | 100.00% | ||
CVR Energy, Inc | Incentive Unit Award | |||
Share-Based Compensation | |||
Weighted-average period for amortization of unrecognized compensation cost | 1 year 6 months | ||
Compensation expense | $ 0.2 | ||
Number of shares considered for determining cash payment for each award upon vesting | 1 | ||
Unrecognized compensation costs | $ 0.9 | ||
Personnel accruals | $ 0.5 | $ 0.5 | |
Vesting period | 3 years | ||
CVR Energy, Inc | CVR Energy LTIP | Performance Shares | Board of Directors Chairman | |||
Share-Based Compensation | |||
Weighted-average period for amortization of unrecognized compensation cost | 9 months | ||
Compensation expense | $ 0.1 | ||
Unrecognized compensation costs | 0.3 | ||
Personnel accruals | $ 0.1 | ||
CVR Energy, Inc | CVR Energy LTIP | Incentive Unit Award | Tranche One | |||
Share-Based Compensation | |||
Vesting percentage | 33.33% | ||
CVR Energy, Inc | CVR Energy LTIP | Incentive Unit Award | Tranche Two | |||
Share-Based Compensation | |||
Vesting percentage | 33.33% | ||
CVR Energy, Inc | CVR Energy LTIP | Incentive Unit Award | Tranche Three | |||
Share-Based Compensation | |||
Vesting percentage | 33.33% |
Share-Based Compensation - Long
Share-Based Compensation - Long-Term Incentive Plan, CVR Partners (Details) - CVR Partners LTIP - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2016 | Mar. 31, 2015 | Dec. 31, 2015 | |
Share-Based Compensation | |||
Vesting period | 3 years | ||
Common stock authorized for issuance (in shares) | 5,000,000 | ||
Common units available for issuance (in shares) | 4,820,215 | ||
Common Unit | Tranche One | |||
Share-Based Compensation | |||
Vesting percentage | 33.33% | ||
Common Unit | Tranche Two | |||
Share-Based Compensation | |||
Vesting percentage | 33.33% | ||
Common Unit | Tranche Three | |||
Share-Based Compensation | |||
Vesting percentage | 33.33% | ||
Phantom Units | |||
Share-Based Compensation | |||
Vesting period | 3 years | ||
Number of shares considered for determining cash payment for each award upon vesting | 1 | ||
Unrecognized compensation cost | $ 2.5 | ||
Weighted-average period for amortization of unrecognized compensation cost | 1 year 6 months | ||
Phantom Units | Tranche One | |||
Share-Based Compensation | |||
Vesting percentage | 33.33% | ||
Phantom Units | Tranche Two | |||
Share-Based Compensation | |||
Vesting percentage | 33.33% | ||
Phantom Units | Tranche Three | |||
Share-Based Compensation | |||
Vesting percentage | 33.33% | ||
Phantom Stock and Common Units | |||
Share-Based Compensation | |||
Compensation expense | $ 0.5 | $ 0.6 | |
Personnel accruals | $ 1.2 | $ 0.7 |
Share-Based Compensation - Sche
Share-Based Compensation - Schedule of Phantom Unit Activity (Details) - CVR Partners LTIP - Phantom Units | 3 Months Ended |
Mar. 31, 2016$ / sharesshares | |
Non-vested shares activity | |
Non-vested at the beginning of the period (in shares) | shares | 391,903 |
Granted (in shares) | shares | 3,475 |
Vested (in shares) | shares | 0 |
Forfeited (in shares) | shares | 0 |
Non-vested at the end of the period (in shares) | shares | 395,378 |
Weighted-Average Grant-Date Fair Value | |
Non-vested at the beginning of the period (in dollars per share) | $ / shares | $ 8.71 |
Granted (in dollars per share) | $ / shares | 7.77 |
Vested (in dollars per share) | $ / shares | 0 |
Forfeited (in dollars per share) | $ / shares | 0 |
Non-vested at the end of the period (in dollars per share) | $ / shares | $ 8.70 |
Inventories (Details)
Inventories (Details) - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 |
Inventory Disclosure [Abstract] | ||
Finished goods | $ 5,494 | $ 9,589 |
Raw materials and precious metals | 8,101 | 9,055 |
Parts and supplies | 18,997 | 18,885 |
Inventories | $ 32,592 | $ 37,529 |
Property, Plant and Equipment42
Property, Plant and Equipment (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2016 | Mar. 31, 2015 | Dec. 31, 2015 | |
Property, Plant, and Equipment | |||
Gross property, plant and equipment | $ 603,554 | $ 602,138 | |
Less: Accumulated depreciation | 215,919 | 209,005 | |
Total property, plant and equipment, net | 387,635 | 393,133 | |
Capitalized interest | 0 | $ 0 | |
Depreciation and amortization not included in direct operating expenses | 6,800 | 6,600 | |
Depreciation and amortization not included in cost of products sold expense | 200 | $ 200 | |
Land and improvements | |||
Property, Plant, and Equipment | |||
Gross property, plant and equipment | 5,441 | 5,441 | |
Buildings and improvements | |||
Property, Plant, and Equipment | |||
Gross property, plant and equipment | 3,235 | 3,049 | |
Machinery and equipment | |||
Property, Plant, and Equipment | |||
Gross property, plant and equipment | 575,636 | 574,326 | |
Automotive equipment | |||
Property, Plant, and Equipment | |||
Gross property, plant and equipment | 483 | 448 | |
Furniture and fixtures | |||
Property, Plant, and Equipment | |||
Gross property, plant and equipment | 869 | 918 | |
Railcars | |||
Property, Plant, and Equipment | |||
Gross property, plant and equipment | 16,315 | 16,315 | |
Construction in progress | |||
Property, Plant, and Equipment | |||
Gross property, plant and equipment | $ 1,575 | $ 1,641 |
Partners' Capital and Partner43
Partners' Capital and Partnership Distributions (Details) $ / shares in Units, $ in Millions | Apr. 26, 2016shares | Apr. 01, 2016 | Mar. 07, 2016USD ($)$ / shares | Mar. 31, 2016partnership_interestshares | Dec. 31, 2015shares |
Related Party Transaction [Line Items] | |||||
Number of types of partnership interests outstanding | partnership_interest | 2 | ||||
Common units issued (in units) | 73,128,269 | 73,128,269 | |||
Common units outstanding (in units) | 73,128,269 | 73,128,269 | |||
Maximum period after the end of each quarter of cash distribution to common unitholders | 60 days | ||||
Cash distribution paid per unit (in dollars per unit) | $ / shares | $ 0.27 | ||||
Cash distributions paid | $ | $ 19.7 | ||||
CRLLC | |||||
Related Party Transaction [Line Items] | |||||
Common units outstanding (in units) | 38,920,000 | ||||
Percentage of common units owned by CRLLC | 53.00% | ||||
Subsequent Event | |||||
Related Party Transaction [Line Items] | |||||
Common units issued (in units) | 113,282,973 | ||||
Subsequent Event | CRLLC | |||||
Related Party Transaction [Line Items] | |||||
Common units outstanding (in units) | 38,920,000 | ||||
Percentage of common units owned by CRLLC | 34.00% | 34.00% |
Accrued Expenses and Other Cu44
Accrued Expenses and Other Current Liabilities (Details) - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 |
Payables and Accruals [Abstract] | ||
Property taxes | $ 1,764 | $ 1,371 |
Current interest rate swap liabilities | 0 | 119 |
Accrued interest | 307 | 458 |
Railcar maintenance accruals | 325 | 209 |
Affiliates | 919 | 2,334 |
Other accrued expenses and liabilities | 1,461 | 1,192 |
Accrued expenses and other current liabilities | $ 4,776 | $ 5,683 |
Credit Facility - Additional In
Credit Facility - Additional Information (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2016 | Dec. 31, 2015 | |
Credit Facility | ||
Trailing quarter period used in calculating leverage ratio | 12 months | |
Line of Credit | CRNF Credit Facility | Eurodollar | ||
Credit Facility | ||
Basis spread on variable rate (as a percent) | 3.50% | |
Line of Credit | CRNF Credit Facility | Eurodollar | Minimum | ||
Credit Facility | ||
Basis spread on variable rate (as a percent) | 3.50% | |
Line of Credit | CRNF Credit Facility | Eurodollar | Maximum | ||
Credit Facility | ||
Basis spread on variable rate (as a percent) | 4.25% | |
Line of Credit | CRNF Credit Facility | Base Rate | Minimum | ||
Credit Facility | ||
Basis spread on variable rate (as a percent) | 2.50% | |
Line of Credit | CRNF Credit Facility | Base Rate | Maximum | ||
Credit Facility | ||
Basis spread on variable rate (as a percent) | 3.25% | |
Line of Credit | CRNF Credit Facility | Prime | ||
Credit Facility | ||
Basis spread on variable rate (as a percent) | 2.50% | |
Term Loan | Line of Credit | CRNF Credit Facility | ||
Credit Facility | ||
Debt instrument face amount | $ 125,000,000 | |
Revolving Credit Facility | Line of Credit | CRNF Credit Facility | ||
Credit Facility | ||
Borrowing capacity | 25,000,000 | |
Uncommitted incremental facility | 50,000,000 | |
Amount outstanding under revolving credit facility | $ 0 | $ 0 |
Effective rate (as a percent) | 3.98% |
Credit Facility - Summary of De
Credit Facility - Summary of Debt (Details) - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 |
Debt Instrument [Line Items] | ||
Less: Deferred financing fees | $ 26 | $ 227 |
Long-term debt, net of current portion | 124,974 | 124,773 |
Term Loan | CRNF Credit Facility | ||
Debt Instrument [Line Items] | ||
Term loan facility | $ 125,000 | $ 125,000 |
Interest Rate Swap (Details)
Interest Rate Swap (Details) | Feb. 12, 2016USD ($)agreement | Mar. 31, 2016USD ($) | Mar. 31, 2015USD ($) |
Designated as hedges | Interest rate swap agreements | CRNF | |||
Interest rate swap | |||
Number of agreements | agreement | 2 | ||
Aggregate notional amount | $ 62,500,000 | ||
Average fixed rate of interest (as a percent) | 1.96% | ||
Loss reclassified to earnings | $ 100,000 | $ 300,000 | |
Designated as hedges | Interest rate swap agreements entered into on June 30, 2011 | CRNF | |||
Interest rate swap | |||
Fixed rate (as a percent) | 1.94% | ||
Settlement period | 90 days | ||
Designated as hedges | Interest rate swap agreements entered into on July 1, 2011 | CRNF | |||
Interest rate swap | |||
Fixed rate (as a percent) | 1.975% | ||
Settlement period | 90 days | ||
Line of Credit | Term Loan | CRNF Term Loan Facility | |||
Interest rate swap | |||
Debt instrument face amount | $ 125,000,000 | ||
Line of Credit | Term Loan | CRNF | CRNF Term Loan Facility | |||
Interest rate swap | |||
Debt instrument face amount | $ 125,000,000 |
Commitments and Contingencies -
Commitments and Contingencies - Minimum Required Payments (Details) $ in Thousands | Mar. 31, 2016USD ($) |
Operating Leases | |
Nine months ending December 31, 2016 | $ 3,616 |
2,017 | 3,307 |
2,018 | 2,496 |
2,019 | 1,897 |
2,020 | 1,403 |
Thereafter | 2,257 |
Operating leases | 14,976 |
Unconditional Purchase Obligations | |
Nine months ending December 31, 2016 | 14,908 |
2,017 | 14,640 |
2,018 | 13,172 |
2,019 | 11,452 |
2,020 | 9,073 |
Thereafter | 54,415 |
Unconditional purchase obligations | $ 117,660 |
Commitments and Contingencies49
Commitments and Contingencies - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
CRNF | ||
Long-term commitments | ||
Lease expense | $ 1.2 | $ 1.1 |
HollyFrontier Corporation | ||
Long-term commitments | ||
Expenses related to agreement | 1.4 | 1.3 |
Material | Linde, Inc. | CRNF | ||
Long-term commitments | ||
Expenses related to agreement | $ 1 | $ 0.8 |
CVR Refining, LP | Purchase obligation for pet coke | ||
Long-term commitments | ||
Period for calculation of the average pet coke price paid to CVR Refining | 2 years |
Related Party Transactions - Fe
Related Party Transactions - Feedstock and Shared Services Agreement (Details) $ in Thousands | 1 Months Ended | 3 Months Ended | ||
Apr. 30, 2011 | Mar. 31, 2016USD ($)affiliate | Mar. 31, 2015USD ($) | Dec. 31, 2015USD ($) | |
Related Party Transaction [Line Items] | ||||
Number of parties | affiliate | 2 | |||
Revenue from related party | $ 73,092 | $ 93,050 | ||
Receivables | 283 | $ 883 | ||
Other long-term assets, with affiliates | 732 | 777 | ||
Accounts payable, due to affiliates | 1,617 | 1,940 | ||
Feedstock and Shared Services Agreement | Hydrogen | CRRM | ||||
Related Party Transaction [Line Items] | ||||
Receivables | 500 | |||
Feedstock and Shared Services Agreement | Hydrogen | CRNF | CRRM | ||||
Related Party Transaction [Line Items] | ||||
Revenue from related party | 1,100 | $ 6,500 | ||
Feedstock and Shared Services Agreement | Nitrogen | ||||
Related Party Transaction [Line Items] | ||||
Related party transaction | 0 | |||
Feedstock and Shared Services Agreement | Tail gas | CRNF | CRRM | ||||
Related Party Transaction [Line Items] | ||||
Receivables | 200 | 200 | ||
Percentage of payment agreed to be paid for cost of capital in fourth year | 15.00% | |||
Period for payment of cost of installation of pipe | 4 years | |||
Other long-term assets, with affiliates | 700 | 800 | ||
Feedstock and Shared Services Agreement | Products and services, excluding hydrogen and tail gas | ||||
Related Party Transaction [Line Items] | ||||
Receivables | 200 | |||
Accounts payable, due to affiliates | $ 600 | $ 700 |
Related Party Transactions - Co
Related Party Transactions - Coke Supply Agreement (Details) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2016USD ($)T$ / T | Mar. 31, 2015USD ($) | Dec. 31, 2015USD ($) | |
Related Party Transaction [Line Items] | |||
Cost of product sold | $ | $ 16,381 | $ 25,769 | |
Accounts payable, due to affiliates | $ | 1,617 | $ 1,940 | |
Coke Supply Agreement | Petroleum coke | |||
Related Party Transaction [Line Items] | |||
Cost of product sold | $ | 700 | $ 1,800 | |
Accounts payable, due to affiliates | $ | $ 100 | $ 300 | |
Coke Supply Agreement | Petroleum coke | CRNF | CRRM | |||
Related Party Transaction [Line Items] | |||
Percentage of annual production of pet coke to be delivered | 100.00% | ||
Annual production of pet coke | T | 500,000 | ||
Period for which average percentage of pet coke is obtained from CRRM's adjacent crude oil refinery | 5 years | ||
Pet coke price used to calculate the UAN-based price under the related party agreement (in dollars per ton) | 25 | ||
UAN-based netback price, exclusive of transportation cost, under the related party agreement (in dollars per ton) | 205 | ||
Pet coke price adjustment for every $1.00 change in the UAN netback price, exclusive of transportation cost, used to calculate the UAN-based price under the related party agreement (in dollars per ton) | 0.5 | ||
UAN-based netback price change, exclusive of transportation cost, under the related party agreement (in dollars per ton) | 1 | ||
Coke Supply Agreement | Petroleum coke | Minimum | CRNF | CRRM | |||
Related Party Transaction [Line Items] | |||
Monthly production volume of product which allows for the purchasing party the option to purchase any excess at rates stated in the agreement | T | 41,667 | ||
Average percentage of pet coke obtained during the last five years from CRRM's adjacent crude oil refinery (over) | 70.00% | ||
Pet coke price used to calculate the UAN-based price under the related party agreement (in dollars per ton) | 5 | ||
Coke Supply Agreement | Petroleum coke | Maximum | CRNF | CRRM | |||
Related Party Transaction [Line Items] | |||
Pet coke price used to calculate the UAN-based price under the related party agreement (in dollars per ton) | 40 |
Related Party Transactions - Sc
Related Party Transactions - Schedule of Services Agreement (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Related Party Transaction [Line Items] | ||
Direct operating expenses (exclusive of depreciation and amortization) — Affiliates | $ 23,690 | $ 24,414 |
Selling, general and administrative expenses (exclusive of depreciation and amortization) — Affiliates | 6,392 | 4,583 |
Services Agreement | ||
Related Party Transaction [Line Items] | ||
Direct operating expenses (exclusive of depreciation and amortization) — Affiliates | 665 | 890 |
Selling, general and administrative expenses (exclusive of depreciation and amortization) — Affiliates | 2,563 | 2,384 |
Total | $ 3,228 | $ 3,274 |
Related Party Transactions - Ad
Related Party Transactions - Additional Information (Details) - USD ($) | Apr. 01, 2016 | Feb. 09, 2016 | Mar. 31, 2016 | Mar. 31, 2015 | Dec. 31, 2015 |
Related Party Transaction [Line Items] | |||||
Accounts payable, due to affiliates | $ 1,617,000 | $ 1,940,000 | |||
Personnel accruals, with affiliates | 1,230,000 | 1,974,000 | |||
Limited Partnership Agreement | |||||
Related Party Transaction [Line Items] | |||||
Personnel costs | 1,100,000 | $ 1,100,000 | |||
Personnel accruals, with affiliates | 1,200,000 | 2,000,000 | |||
Services Agreement | |||||
Related Party Transaction [Line Items] | |||||
Personnel costs | 1,400,000 | $ 1,100,000 | |||
Accounts payable, due to affiliates | 1,800,000 | 3,200,000 | |||
Insight Portfolio Group LLC | |||||
Related Party Transaction [Line Items] | |||||
Related party transaction | 100,000 | ||||
Due to related party | 0 | $ 0 | |||
CRLLC | |||||
Related Party Transaction [Line Items] | |||||
Minimum face amount of third party debt | $ 125,000,000 | ||||
CRLLC | Maximum | |||||
Related Party Transaction [Line Items] | |||||
Guaranty agreement, term of debt | 2 years | ||||
CRLLC | Minimum | |||||
Related Party Transaction [Line Items] | |||||
Termination of guaranty, term of third party debt | 1 year | ||||
CRLLC | Letter of Credit | Subsequent Event | |||||
Related Party Transaction [Line Items] | |||||
Borrowing capacity | $ 150,000,000 | ||||
Loan term | 1 year | ||||
Interest calculation period | 360 days | ||||
CRLLC | Letter of Credit | LIBOR | Subsequent Event | |||||
Related Party Transaction [Line Items] | |||||
Basis spread on variable rate (as a percent) | 3.00% |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 |
Financial Statement Caption and Description | ||
Other current liabilities (interest rate swaps) | $ 0 | $ 119 |
Recurring | ||
Financial Statement Caption and Description | ||
Other current liabilities (interest rate swaps) | 119 | |
Recurring | Level 1 | ||
Financial Statement Caption and Description | ||
Other current liabilities (interest rate swaps) | 0 | |
Recurring | Level 2 | ||
Financial Statement Caption and Description | ||
Other current liabilities (interest rate swaps) | 119 | |
Recurring | Level 3 | ||
Financial Statement Caption and Description | ||
Other current liabilities (interest rate swaps) | $ 0 |
Subsequent Events (Details)
Subsequent Events (Details) - Subsequent Event - USD ($) | Apr. 27, 2016 | Apr. 01, 2016 | Apr. 28, 2016 |
Subsequent Event [Line Items] | |||
Cash distribution declared (in dollars per unit) | $ 0.27 | ||
Cash distribution declared | $ 30,600,000 | ||
CRLLC Facility | Senior Notes | CRLLC | |||
Subsequent Event [Line Items] | |||
Debt instrument face amount | $ 300,000,000 | ||
Loan term | 2 years | ||
Debt instrument, percentage rate | 12.00% | ||
Interest calculation period | 360 days | ||
Debt instrument, carrying amount | $ 300,000,000 | ||
AEPC Facility | Senior Notes | AEPC | |||
Subsequent Event [Line Items] | |||
Debt instrument face amount | $ 320,000,000 | ||
Loan term | 2 years | ||
Debt instrument, percentage rate | 12.00% | ||
Interest calculation period | 360 days |