Document and Entity Information
Document and Entity Information - USD ($) $ in Billions | 12 Months Ended | ||
Dec. 31, 2017 | Jan. 31, 2018 | Jun. 30, 2017 | |
Entity Information | |||
Entity Registrant Name | VALERO ENERGY PARTNERS LP | ||
Entity Central Index Key | 1,583,103 | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2017 | ||
Amendment Flag | false | ||
Document Fiscal Year Focus | 2,017 | ||
Document Fiscal Period Focus | FY | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Public Float | $ 1 | ||
Common Unitholders Public [Member] | |||
Entity Information | |||
Entity Common Stock, Units Outstanding | 69,262,070 | ||
General Partner Valero [Member] | |||
Entity Information | |||
Entity Common Stock, Units Outstanding | 1,413,511 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Current assets: | ||
Cash and cash equivalents | $ 42,052 | $ 71,491 |
Receivables – related party | 46,496 | 36,889 |
Receivables | 781 | 1,682 |
Prepaid expenses and other | 720 | 997 |
Total current assets | 90,049 | 111,059 |
Property and equipment, at cost | 1,969,233 | 1,216,288 |
Accumulated depreciation | (552,817) | (351,208) |
Property and equipment, net | 1,416,416 | 865,080 |
Deferred charges and other assets, net | 10,887 | 3,118 |
Total assets | 1,517,352 | 979,257 |
Current liabilities: | ||
Accounts payable | 18,633 | 10,652 |
Accounts payable – related party | 3,944 | 7,348 |
Accrued liabilities | 1,007 | 870 |
Accrued liabilities – related party | 202 | 192 |
Accrued interest payable | 2,558 | 1,280 |
Accrued interest payable – related party | 911 | 47 |
Taxes other than income taxes payable | 5,141 | 2,457 |
Deferred revenue – related party | 926 | 3,525 |
Total current liabilities | 33,322 | 26,371 |
Debt | 905,283 | 525,355 |
Notes payable – related party | 370,000 | 370,000 |
Other long-term liabilities | 2,950 | 1,707 |
Commitments and contingencies | ||
Partners’ capital: | ||
Total partners’ capital | 205,797 | 55,824 |
Total liabilities and partners’ capital | 1,517,352 | 979,257 |
Limited Partner [Member] | Common Unitholders Public [Member] | ||
Partners’ capital: | ||
Limited partners | 596,047 | 548,619 |
Total partners’ capital | 596,047 | 548,619 |
Limited Partner [Member] | Common Unitholder Valero [Member] | ||
Partners’ capital: | ||
Limited partners | (382,652) | (482,197) |
Total partners’ capital | (382,652) | (482,197) |
General Partner Valero [Member] | ||
Partners’ capital: | ||
General partner – Valero | (7,598) | (10,598) |
Total partners’ capital | $ (7,598) | $ (10,598) |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - shares | Dec. 31, 2017 | Dec. 31, 2016 |
Limited Partner [Member] | Common Unitholders Public [Member] | ||
Limited partner, units outstanding | 22,487,586 | 21,738,692 |
Limited Partner [Member] | Common Unitholder Valero [Member] | ||
Limited partner, units outstanding | 46,768,586 | 45,687,271 |
General Partner Valero [Member] | ||
General partner – Valero, units outstanding | 1,413,391 | 1,375,721 |
Consolidated Statements of Inco
Consolidated Statements of Income - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | ||
Income Statement [Abstract] | ||||
Operating revenues – related party | $ 452,005 | $ 362,619 | $ 243,624 | |
Costs and expenses: | ||||
Cost of revenues (excluding depreciation expense reflected below) | [1] | 108,374 | 96,115 | 105,973 |
Depreciation expense | 52,475 | 45,965 | 45,678 | |
Other operating expenses | 577 | 0 | 0 | |
General and administrative expenses | [2] | 15,549 | 15,965 | 14,520 |
Total costs and expenses | 176,975 | 158,045 | 166,171 | |
Operating income | 275,030 | 204,574 | 77,453 | |
Other income, net | 753 | 284 | 223 | |
Interest and debt expense, net of capitalized interest | [3] | (36,015) | (14,915) | (6,113) |
Income before income tax expense | 239,768 | 189,943 | 71,563 | |
Income tax expense | 1,335 | 1,112 | 251 | |
Net income | 238,433 | 188,831 | 71,312 | |
Less: Net loss attributable to Predecessor | 0 | (15,422) | (60,566) | |
Net income attributable to partners | 238,433 | 204,253 | 131,878 | |
Less: General partner’s interest in net income | 49,113 | 23,553 | 6,069 | |
Limited partners’ interest in net income | $ 189,320 | $ 180,700 | $ 125,809 | |
Net income per limited partner unit – basic and diluted: | ||||
Common units (in dollars per share) | $ 2.77 | $ 2.85 | $ 2.12 | |
Subordinated units (in dollars per share) | $ 0 | $ 2.38 | $ 2.07 | |
Weighted-average limited partner units outstanding – basic and diluted: | ||||
Common units (shares) | 68,220 | 48,817 | 31,222 | |
Subordinated units (shares) | 0 | 17,463 | 28,790 | |
Cash distribution declared per unit (in dollars per unit) | $ 1.87 | $ 1.4965 | $ 1.1975 | |
[1] | Includes cost of revenues (excluding depreciation expense) – related party of $67,067 thousand , $61,649 thousand, and $55,649 thousand for the years ended December 31, 2017, 2016, and 2015, respectively. | |||
[2] | Includes general and administrative expenses – related party of $12,858 thousand, $12,539 thousand, and $11,695 thousand for the years ended December 31, 2017, 2016, and 2015, respectively. | |||
[3] | Includes interest and debt expense – related party of $9,658 thousand, $6,608 thousand, and $3,190 thousand for the years ended December 31, 2017, 2016, and 2015, respectively. |
Consolidated Statements of Inc5
Consolidated Statements of Income (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Supplemental Information [Abstract] | |||
Cost of revenues (excluding depreciation expense) – related party | $ 67,067 | $ 61,649 | $ 55,649 |
General and administrative expenses – related party | 12,858 | 12,539 | 11,695 |
Interest and debt expense – related party | $ 9,658 | $ 6,608 | $ 3,190 |
Consolidated Statements of Part
Consolidated Statements of Partners' Capital - USD ($) $ in Thousands | Total | Limited Partner [Member]Common Unitholders Public [Member] | Limited Partner [Member]Common Unitholder Valero [Member] | Limited Partner [Member]Subordinated Unitholder Valero [Member] | General Partner Valero [Member] | Net Investment [Member] |
Beginning balance at Dec. 31, 2014 | $ 1,069,594 | $ 374,954 | $ 58,844 | $ 146,804 | $ 4,617 | $ 484,375 |
Net income (loss): | ||||||
Net loss attributable to Predecessor | (60,566) | (60,566) | ||||
Net income attributable to partners | 131,878 | 37,183 | 28,548 | 60,078 | 6,069 | |
Net transfers from Valero Energy Corporation | 70,334 | 70,334 | ||||
Allocation of Valero Energy Corporation’s net investment in acquisitions | 0 | 111,433 | 267,700 | 11,011 | (390,144) | |
Acquisitions from Valero Energy Corporation: | ||||||
Cash paid for carrying value of acquired businesses | (390,144) | (111,433) | (267,700) | (11,011) | ||
Cash paid in excess of carrying value of acquired businesses/assets acquired | (576,076) | (52,506) | (505,985) | (17,585) | ||
Unit issuance | 192,926 | 188,915 | 4,011 | |||
Noncash contributions from Valero Energy Corporation | 27,748 | 8,898 | 18,063 | 787 | ||
Cash distributions to unitholders and distribution equivalent right payments | (71,715) | (19,736) | (15,354) | (32,921) | (3,704) | |
Unit-based compensation | 173 | 173 | ||||
Ending balance at Dec. 31, 2015 | 394,152 | 581,489 | 28,430 | (313,961) | (5,805) | 103,999 |
Net income (loss): | ||||||
Net loss attributable to Predecessor | (15,422) | (15,422) | ||||
Net income attributable to partners | 204,253 | 58,688 | 76,690 | 45,322 | 23,553 | |
Net transfers from Valero Energy Corporation | 15,030 | 15,030 | ||||
Allocation of Valero Energy Corporation’s net investment in acquisitions | 0 | 67,800 | 32,758 | 3,049 | (103,607) | |
Acquisitions from Valero Energy Corporation: | ||||||
Cash paid for carrying value of acquired businesses | (103,607) | (67,800) | (32,758) | (3,049) | ||
Cash paid in excess of carrying value of acquired businesses/assets acquired | (376,393) | (246,759) | (120,309) | (9,325) | ||
Conversion of subordinated units | 0 | (406,374) | 406,374 | |||
Unit issuance | 11,289 | 11,091 | 198 | 0 | ||
Transfers to (from) partners | 0 | (72,452) | 76,584 | (4,132) | ||
Noncash contributions from Valero Energy Corporation | 35,732 | 22,730 | 12,084 | 918 | ||
Cash distributions to unitholders and distribution equivalent right payments | (109,406) | (30,393) | (33,498) | (29,510) | (16,005) | |
Unit-based compensation | 196 | 196 | ||||
Ending balance at Dec. 31, 2016 | 55,824 | 548,619 | (482,197) | 0 | (10,598) | 0 |
Net income (loss): | ||||||
Net loss attributable to Predecessor | 0 | |||||
Net income attributable to partners | 238,433 | 62,014 | 127,306 | 0 | 49,113 | 0 |
Acquisitions from Valero Energy Corporation: | ||||||
Cash paid in excess of carrying value of acquired businesses/assets acquired | (54,618) | (53,045) | (1,573) | |||
Unit issuance | 34,176 | 33,428 | 748 | |||
Transfers to (from) partners | 0 | (8,773) | 15,957 | (7,184) | ||
Noncash contributions from Valero Energy Corporation | 93,007 | 90,666 | 2,341 | |||
Cash distributions to unitholders and distribution equivalent right payments | (161,291) | (39,507) | (81,339) | (40,445) | ||
Unit-based compensation | 266 | 266 | ||||
Ending balance at Dec. 31, 2017 | $ 205,797 | $ 596,047 | $ (382,652) | $ 0 | $ (7,598) | $ 0 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Cash flows from operating activities: | |||
Net income | $ 238,433 | $ 188,831 | $ 71,312 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation expense | 52,475 | 45,965 | 45,678 |
Changes in current assets and current liabilities | (3,730) | (5,956) | (8,973) |
Changes in deferred charges and credits and other operating activities, net | 1,753 | 1,054 | 359 |
Net cash provided by operating activities | 288,931 | 229,894 | 108,376 |
Cash flows from investing activities: | |||
Capital expenditures | (38,516) | (23,156) | (38,109) |
Other investing activities, net | 302 | 31 | 82 |
Net cash used in investing activities | (517,851) | (126,732) | (428,171) |
Cash flows from financing activities: | |||
Proceeds from debt borrowings | 380,000 | 349,000 | 200,000 |
Proceeds from issuance of senior notes | 0 | 499,795 | 0 |
Proceeds from notes payable – related party | 0 | 0 | 555,000 |
Repayment of debt and capital lease obligations | 0 | (494,913) | (26,200) |
Repayment of notes payable – related party | 0 | 0 | (185,000) |
Payment of debt issuance costs | (492) | (4,462) | (2,322) |
Proceeds from issuance of common units | 35,728 | 9,724 | 189,683 |
Proceeds from issuance of general partner units | 748 | 198 | 4,011 |
Payment of offering costs | (594) | (883) | (666) |
Excess purchase price paid to Valero Energy Corporation over the carrying value of acquired assets | (54,618) | (376,393) | (576,076) |
Cash distributions to unitholders and distribution equivalent right payments | (161,291) | (109,406) | (71,715) |
Net transfers from Valero Energy Corporation | 0 | 14,886 | 77,284 |
Net cash provided by (used in) financing activities | 199,481 | (112,454) | 163,999 |
Net decrease in cash and cash equivalents | (29,439) | (9,292) | (155,796) |
Cash and cash equivalents at beginning of year | 71,491 | 80,783 | 236,579 |
Cash and cash equivalents at end of year | 42,052 | 71,491 | 80,783 |
Majority Shareholder [Member] | |||
Cash flows from investing activities: | |||
Acquisition of interest in crude system and acquisitions from Valero Energy Corporation | (407,844) | (103,607) | (390,144) |
Cash flows from financing activities: | |||
Excess purchase price paid to Valero Energy Corporation over the carrying value of acquired assets | (54,618) | (376,393) | (576,076) |
Net transfers from Valero Energy Corporation | 0 | 14,886 | 77,284 |
Red River Crude System [Member] | |||
Cash flows from investing activities: | |||
Acquisition of interest in crude system and acquisitions from Valero Energy Corporation | $ (71,793) | $ 0 | $ 0 |
Description of Business, Basis
Description of Business, Basis of Presentation, and Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
DESCRIPTION OF BUSINESS, BASIS OF PRESENTATION, AND SIGNIFICANT ACCOUNTING POLICIES | 1. DESCRIPTION OF BUSINESS, BASIS OF PRESENTATION, AND SIGNIFICANT ACCOUNTING POLICES Description of Business As used in this report, the terms “Partnership,” “we,” “our,” or “us” refer to Valero Energy Partners LP, one or more of its subsidiaries, or all of them taken as a whole. References to our “general partner” refer to Valero Energy Partners GP LLC, an indirect wholly owned subsidiary of Valero Energy Corporation. References in this report to “Valero” refer collectively to Valero Energy Corporation and its subsidiaries, other than Valero Energy Partners LP, any of its subsidiaries, or its general partner. We are a master limited partnership formed by Valero in July 2013 to own, operate, develop, and acquire crude oil and refined petroleum products pipelines, terminals, and other logistics assets. Our assets consist of crude oil and refined petroleum products pipeline and terminal systems in the United States (U.S.) Gulf Coast and U.S. Mid-Continent regions that are integral to the operations of ten of Valero’s refineries. We generate operating revenues by providing fee-based transportation and terminaling services. Basis of Presentation General These consolidated financial statements were prepared in accordance with U.S. generally accepted accounting principles (GAAP) and with the rules and regulations of the U.S. Securities and Exchange Commission. Acquisitions from Valero Certain of our acquisitions from Valero, as described in Note 2 , were accounted for as transfers of businesses between entities under the common control of Valero. Accordingly, we recorded these business acquisitions on our balance sheet at Valero’s carrying value as of the beginning of the period of transfer, and we retrospectively adjusted prior period financial statements and financial information to furnish comparative information. We refer to the historical results of the transferred businesses from Valero prior to their transfer to us as those of our “Predecessor.” The combined financial statements of our Predecessor were derived from the consolidated financial statements and accounting records of Valero and reflect the combined historical financial position, results of operations, and cash flows of our Predecessor as if the acquisitions from Valero had been combined for periods prior to the effective dates of each acquisition. There were no transactions between the operations of our Predecessor; therefore, there were no intercompany transactions or accounts to be eliminated in connection with the combination of those operations. In addition, our Predecessor’s statements of income include direct charges for the management and operation of our assets and certain expenses allocated by Valero for general corporate services, such as treasury, accounting, and legal services. These expenses were charged, or allocated, to our Predecessor based on the nature of the expenses. Prior to the acquisitions from Valero, our Predecessor transferred cash to Valero daily and Valero funded our Predecessor’s operating and investing activities as needed. Therefore, transfers of cash to and from Valero’s cash management system are reflected as a component of net investment and are reflected as a financing activity in our statements of cash flows. In addition, interest expense was not included on the net cash transfers from Valero. The acquisitions of Parkway Pipeline LLC (Parkway Pipeline) and the Port Arthur terminal (defined in Note 2 ) from Valero on November 1, 2017 were accounted for as transfers of assets between entities under the common control of Valero. Accordingly, we recorded these asset acquisitions on our balance sheet at Valero’s carrying value as of the acquisition date, and our prior period financial statements and financial information were not retrospectively adjusted for these acquisitions. The financial information presented for the periods after the effective dates of each acquisition represents the consolidated financial position, results of operations, and cash flows of the Partnership. Reclassifications Certain prior year amounts have been reclassified to conform to the 2017 presentation. Significant Accounting Policies Principles of Consolidation Our consolidated financial statements include the accounts of the Partnership, our subsidiaries, and our Predecessor. All intercompany items and transactions have been eliminated. Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from these estimates. On an ongoing basis, we review our estimates based on currently available information. Changes in facts and circumstances may result in revised estimates. Cash Equivalents Our cash equivalents are highly liquid investments that have a maturity of three months or less when acquired. Receivables – Related Party Receivables – related party include trade receivables from Valero for transportation and terminaling services provided under various agreements with Valero, as more fully described in Note 3 . These receivables are recorded at the original invoice amount. Property and Equipment The cost of property and equipment purchased or constructed, including betterments of property and equipment, is capitalized. However, the cost of repairs to and normal maintenance of property and equipment is expensed when incurred. Betterments of property and equipment are those that extend the useful lives of the property and equipment or improve the safety of our operations. The cost of property and equipment constructed includes interest and certain overhead costs allocable to the construction activities. Property and equipment also includes our undivided interest in certain assets. When property and equipment are retired or replaced, the cost and related accumulated depreciation are eliminated, with any gain or loss reflected in depreciation expense, unless such amounts are reported separately due to materiality. Depreciation of property and equipment is recorded on a straight-line basis over the estimated useful lives of the related assets. Leasehold improvements are amortized on a straight-line basis over the shorter of the lease term or the estimated useful life of the related asset. Impairment of Assets Long-lived assets are tested for recoverability whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable. A long-lived asset is not recoverable if its carrying amount exceeds the sum of the undiscounted cash flows expected to result from its use and eventual disposition. If a long-lived asset is not recoverable, an impairment loss is recognized for the amount by which the carrying amount of the long-lived asset exceeds its fair value, with fair value determined based on discounted estimated net cash flows or other appropriate methods. Asset Retirement Obligations We record a liability, which is referred to as an asset retirement obligation, at fair value for the estimated cost to retire a tangible long-lived asset at the time we incur that liability, which is generally when the asset is purchased, constructed, or leased. We record the liability when we have a legal obligation to incur costs to retire the asset and when a reasonable estimate of the fair value of the liability can be made. If a reasonable estimate cannot be made at the time the liability is incurred, we record the liability when sufficient information is available to estimate the liability’s fair value. Environmental Matters Liabilities for future remediation costs are recorded when environmental assessments and/or remedial efforts are probable and the costs can be reasonably estimated. Other than for assessments, the timing and magnitude of these accruals generally are based on the completion of investigations or other studies or a commitment to a formal plan of action. Amounts recorded for environmental liabilities have not been reduced by possible recoveries from third parties and have not been measured on a discounted basis. Net Investment Net investment represents Valero’s historical investment in our Predecessor, its accumulated net earnings after taxes, and the net effect of transactions and allocations between our Predecessor and Valero. There were no terms of settlement or interest charges associated with the net investment balance. Revenue Recognition We generate operating revenues by providing fee-based transportation and terminaling services to transport and store crude oil and refined petroleum products using our pipelines and terminals under long-term commercial agreements (defined in Note 3 ). Operating revenues are recognized upon completion of the transportation or terminaling service. Certain of these commercial agreements are considered operating leases under U.S. GAAP. Lease revenue is recognized over the lease term and contingent lease revenue is recognized after minimum monthly volume commitment requirements on these leases have been met. As further described in Note 3 , certain of our commercial agreements contain minimum volume commitments. Under these commercial agreements, if our customer fails to transport its minimum throughput volumes during any quarter, then the customer will pay us a deficiency payment equal to the volume of the deficiency multiplied by the contractual rate then in effect. The deficiency payment is initially recorded as deferred revenue – related party on our balance sheets. Our customer may apply the amount of any such deficiency payments as a credit for volumes transported on the applicable pipeline or terminal system in excess of its minimum volume commitment during the following four quarters under the terms of the applicable agreement. We recognize operating revenues for the deficiency payments when credits are used for volumes transported in excess of minimum volume commitments. If we determine, based on all available information, that it is remote that our customer will utilize these payments, the amount of the expected unused credits will be recognized as operating revenues in the period when that determination is made. The use or recognition of the credits is a reduction to deferred revenue – related party. Income Taxes Our operations are treated as a partnership for federal and state income tax purposes, with each partner being separately taxed on its share of taxable income. Therefore, we have excluded income taxes from these financial statements, except for state taxes that apply to partnerships, specifically the margin tax in Texas. Our Predecessor’s taxable income was included in the consolidated U.S. federal income tax returns of Valero and in certain consolidated state income tax returns. Income taxes are accounted for under the asset and liability method, as if we were a separate taxpayer rather than a member of Valero’s consolidated tax return. Under this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred amounts are measured using enacted tax rates expected to apply to taxable income in the year those temporary differences are expected to be recovered or settled. We classify any interest expense and penalties related to the underpayment of income taxes in income tax expense. Net Income per Limited Partner Unit Basic and diluted net income per limited partner unit is determined pursuant to the two-class method for master limited partnerships as further described in Note 9 . Comprehensive Income We have not reported comprehensive income due to the absence of items of other comprehensive income in the years presented. Segment Reporting Our operations consist of one reportable segment. All of our operations are conducted and all of our assets are located in the U.S. Financial Instruments Our financial instruments include cash and cash equivalents, receivables, receivables – related party, accounts payable, accounts payable – related party, debt, and notes payable – related party. The estimated fair values of these financial instruments approximate their carrying amounts, except for certain debt as discussed in Note 14 . Business Combinations We adopted the provisions of Accounting Standards Update (ASU) No. 2017-01, “Business Combinations (Topic 805),” issued by the Financial Accounting Standards Board (FASB), on January 1, 2017. This ASU provides a more robust framework to evaluate whether transactions should be accounted for as acquisitions (dispositions) of assets or businesses. Our adoption of this ASU resulted in the acquisitions of Parkway Pipeline and the Port Arthur terminal being accounted for as acquisitions of assets. See further discussion of these acquisitions in Note 2 . In addition, more of our future acquisitions may be accounted for as acquisitions of assets in accordance with this ASU. Accounting Pronouncements Adopted on January 1, 2018 ASU No. 2014-09 In May 2014, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606),” to clarify the principles for recognizing revenue. This new standard is effective for annual reporting periods beginning after December 15, 2017, including interim reporting periods within those annual periods. We adopted this standard on January 1, 2018, and it will not materially change the amount or timing of revenues recognized by us, nor will it materially affect our financial position. We generate operating revenues by providing fee-based transportation and terminaling services to transport and store crude oil and refined petroleum products using our pipelines and terminals under long-term commercial agreements. Revenues from contracts with customers are recognized over time as our performance obligation is satisfied. Revenue is measured as the amount of consideration we expect to receive in exchange for providing the service. Certain of our commercial agreements are considered operating leases under U.S. GAAP. The scope of this new standard does not extend to revenues generated by lease arrangements; therefore, lease revenues generated by us will continue to be accounted for under existing lease accounting standards but will be reflected in a separate revenue line item on our statements of income. We adopted this new standard on January 1, 2018 using the modified retrospective method, as permitted by the standard. Under this method, the cumulative effect of initially applying the standard is recognized as an adjustment to the opening balance of partners’ capital, and revenues reported in the periods prior to the date of adoption are not changed. Because the adoption of this standard did not materially impact the manner in which we recognize revenues, we will not make such an adjustment to partners’ capital. We continue to develop our revenue disclosures and have enhanced our accounting systems to enable the preparation of such disclosures. ASU No. 2016-01 In January 2016, the FASB issued ASU No. 2016-01, “Financial Instruments—Overall (Subtopic 825-10),” to enhance the reporting model for financial instruments regarding certain aspects of recognition, measurement, presentation, and disclosure. The provisions of this ASU are effective for annual reporting periods beginning after December 15, 2017, and interim reporting periods within those annual periods. This ASU is to be applied using a cumulative-effect adjustment to the balance sheet as of the beginning of the year of adoption. The adoption of this ASU effective January 1, 2018 did not affect our financial position nor will it affect our results of operations, but it will result in revised disclosures. Accounting Pronouncements Not Yet Adopted ASU No. 2016-02 In February 2016, the FASB issued ASU No. 2016-02, “Leases (Topic 842),” to increase the transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. This new standard is effective for annual reporting periods beginning after December 15, 2018, and interim reporting periods within those annual periods, with early adoption permitted. We will adopt this new standard on January 1, 2019, and we expect to use the modified retrospective method of adoption. We are enhancing our contracting and lease evaluation systems and related processes, and we are developing a new lease accounting system to capture our leases and support the required disclosures. During 2018, we will continue to monitor the adoption process to ensure compliance with the accounting and disclosure requirements. We also continue the integration of our lease accounting system with our general ledger, and we will make modifications to the related procurement and payment processes. We anticipate this standard will have a material impact on our financial position, but we do not expect adoption to have a material impact on our results of operations or liquidity. While we continue to assess potential impacts of the standard, we currently expect the most significant impact will be the recognition of right-of-use assets and lease liabilities for operating leases. |
Acquisitions
Acquisitions | 12 Months Ended |
Dec. 31, 2017 | |
Business Combinations [Abstract] | |
ACQUISITIONS | 2. ACQUISITIONS In connection with the following acquisitions, we entered into various agreements with Valero, including additional schedules to our commercial agreements, an amended and restated omnibus agreement, an amended and restated services and secondment agreement, and lease agreements. See Note 3 for a summary of the terms of these agreements. Acquisitions in 2017 Red River Crude System On January 18, 2017 , we acquired a 40 percent undivided interest in (i) the Hewitt segment of Plains All American Pipeline, L.P.’s (Plains) Red River pipeline (the Hewitt segment), (ii) two 150,000 shell barrel capacity tanks located at Hewitt Station in Hewitt, Oklahoma (the Hewitt Storage Tanks), and (iii) a pipeline connection from Hewitt Station to Wasson Station (the Wasson Interconnect) (collectively, the Red River crude system) for total cash consideration of $71.8 million , which we funded with available cash on hand. This acquisition was accounted for as an acquisition of assets. The Hewitt segment consists of an approximately 138-mile, 16-inch crude oil pipeline with 150,000 barrels per day of throughput capacity that originates at Plains Marketing L.P.’s Cushing, Oklahoma terminal and ends at Hewitt Station. The pipeline supports Valero’s Ardmore Refinery and began supplying crude oil to Valero in January 2017. We retain a right to participate in any future expansions of the pipeline. We also entered into a Joint Ownership Agreement (JOA) and an Operating and Administrative Services Agreement with Plains concurrent with this acquisition. The JOA provides us with access to the remaining 60 percent of the capacity of the Hewitt Storage Tanks and the Wasson Interconnect and continues until terminated by mutual agreement. This access arrangement is accounted for as an operating lease. The administrative agreement facilitates the day-to-day operations and management functions of the pipeline for an initial five -year term and automatically renews for successive five -year terms. Parkway Pipeline On November 1, 2017 , we acquired Parkway Pipeline, a subsidiary of Valero, that owns and operates an approximately 140-mile, 16-inch refined petroleum products pipeline with 110,000 barrels per day of capacity that transports refined petroleum products from Valero’s St. Charles Refinery, located in Norco, Louisiana, to Collins, Mississippi for supply into the Plantation and Colonial pipeline systems, for cash consideration of $200.0 million . We funded the cash distribution with $82.0 million of our cash on hand and $118.0 million of borrowings under our revolving credit facility. This acquisition was accounted for as a transfer of assets between entities under the common control of Valero. Port Arthur Terminal On November 1, 2017 , we acquired Valero Partners Port Arthur, LLC, a subsidiary of Valero that owns certain terminaling assets (Port Arthur terminal) that support Valero’s Port Arthur Refinery for total consideration of $308.0 million , which consisted of (i) a cash distribution of $262.0 million and (ii) the issuance of 1,081,315 common units and 22,068 general partner units to Valero having an aggregate value of $46.0 million . We funded the cash distribution with $262.0 million of borrowings under our revolving credit facility. See Note 5 for further discussion of the borrowings under our revolving credit facility. This acquisition was accounted for as a transfer of assets between entities under the common control of Valero. Acquisitions in 2016 McKee Terminal Services Business On April 1, 2016 , we acquired from Valero a subsidiary that owns and operates a crude oil, intermediates, and refined petroleum products terminal supporting Valero’s McKee Refinery for total consideration of $240.0 million , which consisted of (i) a cash distribution of $204.0 million and (ii) the issuance of 728,775 common units and 14,873 general partner units to Valero having an aggregate value of $36.0 million . We funded the cash distribution with $65.0 million of our cash on hand and $139.0 million of borrowings under our revolving credit facility. See Note 5 for further discussion of the borrowings under our revolving credit facility. This acquisition was accounted for as a transfer of a business between entities under the common control of Valero. See Note 1 for a further discussion about the accounting and basis of presentation of this acquisition. Meraux and Three Rivers Terminal Services Business On September 1, 2016 , we acquired from Valero two subsidiaries that own and operate crude oil, intermediates, and refined petroleum products terminals supporting Valero’s Meraux and Three Rivers Refineries for total consideration of $325.0 million which consisted of (i) a cash distribution of $276.0 million and (ii) the issuance of 1,149,905 common units and 23,467 general partner units to Valero having an aggregate value of $49.0 million . We funded the cash distribution with $66.0 million of our cash on hand and $210.0 million of borrowings under our revolving credit facility. See Note 5 for further discussion of the borrowings under our revolving credit facility. This acquisition was accounted for as a transfer of a business between entities under the common control of Valero. See Note 1 for a further discussion about the accounting and basis of presentation of this acquisition. Acquisitions in 2015 Houston and St. Charles Terminal Services Business On March 1, 2015 , we acquired from Valero two subsidiaries that own and operate crude oil, intermediates, and refined petroleum products terminals supporting Valero’s Houston and St. Charles Refineries for total consideration of $671.2 million , which consisted of (i) a cash distribution of $571.2 million and (ii) the issuance of 1,908,100 common units and 38,941 general partner units to Valero having an aggregate value of $100.0 million . We funded the cash distribution to Valero with $211.2 million of our cash on hand, $200.0 million of borrowings under our revolving credit facility, and $160.0 million of proceeds from a subordinated credit agreement with Valero. See Note 5 for further discussion of the borrowings under our revolving credit facility and subordinated credit agreement. This acquisition was accounted for as a transfer of a business between entities under the common control of Valero. See Note 1 for a further discussion about the accounting and basis of presentation of this acquisition. Corpus Christi Terminal Services Business On October 1, 2015 , we acquired from Valero two subsidiaries that own and operate crude oil, intermediates, and refined petroleum products at terminals supporting Valero’s Corpus Christi East and West Refineries for total consideration of $465.0 million , which consisted of (i) a cash distribution of $ 395.0 million and (ii) the issuance of 1,570,513 common units and 32,051 general partner units to Valero having an aggregate value of $70.0 million . We funded the cash distribution to Valero with $395.0 million of proceeds from a subordinated credit agreement with Valero. See Note 5 for further discussion of the borrowings under our subordinated credit agreement. This acquisition was accounted for as a transfer of a business between entities under the common control of Valero. See Note 1 for a further discussion about the accounting and basis of presentation of this acquisition. |
Related-Party Agreements and Tr
Related-Party Agreements and Transactions | 12 Months Ended |
Dec. 31, 2017 | |
Related Party Transactions [Abstract] | |
RELATED-PARTY AGREEMENTS AND TRANSACTIONS | 3. RELATED-PARTY AGREEMENTS AND TRANSACTIONS Predecessor Transactions Our Predecessor was part of the consolidated operations of Valero and all of our operating revenues were derived from transactions with Valero. The crude oil and refined petroleum products pipeline transportation and terminaling services we provided to Valero were settled through net parent investment, and payables and receivables related to these transactions were included as a component of net investment. Prior to the dates of each of our business acquisitions from Valero, our operating and general and administrative expenses included charges to our Predecessor for the management of our operations and the allocation of certain overhead and shared services expenses by Valero. These charges and allocations included such items as management oversight, information technology, legal, human resources, and other financial and administrative services. These allocations do not fully reflect the expenses that would have been incurred had we been a stand-alone limited partnership. Our management believes the charges allocated to our Predecessor were a reasonable reflection of the utilization of services provided, but they cannot be presumed to be carried out on an arm’s-length basis as the requisite conditions of competitive, free-market dealings may not have existed. Agreements with Valero Commercial Agreements We have transportation services agreements and a terminal services agreement (collectively, the commercial agreements) with Valero. Under these commercial agreements, we provide transportation and terminaling services to Valero and Valero pays us for minimum quarterly throughput volumes of crude oil and refined petroleum products, regardless of whether such volumes are physically delivered by Valero in any given quarter. In connection with the IPO and subsequent acquisitions, we entered into schedules under these commercial agreements. Each schedule generally has an initial term of ten years, provides Valero an option to renew for one additional five -year term, and contains minimum throughput requirements and inflation escalators. Effective March 31, 2017 , we entered into a commercial agreement with Diamond Green Diesel Holdings, LLC (DGD), a joint venture consolidated by Valero, to construct and operate a rail loading facility located at Valero’s St. Charles Refinery for the purpose of loading DGD’s renewable diesel onto railcars. The construction of the rail loading facility was completed in April 2017, and we began providing services to DGD in May 2017. In addition, we have agreed to construct a new 180,000 barrel storage tank and provide storage services to DGD. The construction of the new tank is expected to be completed in the first quarter of 2018. The agreement has an initial term that ends on June 30, 2033 . The agreement contains minimum commitments for DGD’s use of the assets. Amended and Restated Omnibus Agreement We have an amended and restated omnibus agreement with Valero, certain of its subsidiaries, and our general partner that addresses our payment of an annual administrative fee and our obligation to reimburse Valero for certain direct or allocated costs and expenses incurred by Valero on our behalf. This agreement also addresses, but is not limited to, indemnification rights of Valero and us for certain environmental and other liabilities related to our assets. As of December 31, 2017 , the annual administrative fee was $ 13.2 million . So long as Valero controls our general partner, the amended and restated omnibus agreement will remain in full force and effect. If Valero ceases to control our general partner, either party may terminate the amended and restated omnibus agreement, provided that the indemnification obligations will remain in full force and effect in accordance with their terms. Amended and Restated Services and Secondment Agreement Under the terms of an amended and restated services and secondment agreement, including its amended and restated exhibits, employees of Valero are seconded to our general partner to provide operational and maintenance services for certain of our pipelines and terminals, and we reimburse our general partner for these costs. During their period of secondment, the seconded employees are under the management and supervision of our general partner. This agreement has an initial term of ten years from the Service Date (as described in the agreement) with respect to each acquisition and will automatically extend for successive renewal terms of one year each, unless terminated by either party upon at least 30 days’ prior written notice before the end of the initial term or any renewal term. In addition, our general partner may terminate the agreement or reduce the level of services under the agreement at any time upon 30 days’ prior written notice. Lease Agreements We have lease agreements with Valero with respect to the land on which certain terminals are located. Generally, each lease agreement has an initial term of ten years with four automatic successive renewal periods of five years each. Either party may terminate each lease agreement after the initial term by providing written notice. We also have a ground lease agreement with an initial term of twenty years and no renewal periods. Initial base rent under these lease agreements is subject to annual inflation escalators, and we are required to pay Valero a customary expense reimbursement for taxes, utilities, and similar costs incurred by Valero related to the leased premises. See Note 7 for further discussion about our lease commitments with Valero. Tax Sharing Agreement Under our tax sharing agreement with Valero, we are required to reimburse Valero for our share of state and local income and other taxes incurred by Valero as a result of our tax items and attributes being included in a combined or consolidated state tax return filed by Valero with respect to taxable periods including or beginning on or after the closing date of the IPO. The amount of any such reimbursement will be limited to any entity-level tax that we would have paid directly had we not been included in a combined group with Valero. While Valero may use its tax attributes to cause its combined or consolidated group, of which we may be a member for this purpose, to owe no tax, we are nevertheless required to reimburse Valero for the tax we would have owed had the attributes not been available or used for our benefit, even though Valero had no cash expense for that period. Subordinated Credit Agreements We have subordinated credit agreements with Valero as further described in Note 5 . Summary of Transactions Operating Revenues Operating revenues – related party disaggregated by activity type were as follows (in thousands): Year Ended December 31, 2017 2016 2015 Pipeline transportation revenues $ 100,631 $ 78,451 $ 81,435 Terminaling revenues 347,996 283,628 161,649 Storage and other revenues 3,378 540 540 Total operating revenues – related party $ 452,005 $ 362,619 $ 243,624 Certain schedules under our commercial agreements with Valero are considered operating leases under U.S. GAAP. These agreements contain minimum throughput requirements and escalation clauses to adjust transportation tariffs and terminaling and storage fees to reflect changes in price indices. These lease revenues are recorded within operating revenues – related party in our statements of income. The components of our lease revenues were as follows (in thousands): Year Ended December 31, 2017 2016 2015 Minimum rental revenues $ 292,034 $ 232,211 $ 128,468 Contingent rental revenues 59,498 41,519 22,949 Total lease revenues $ 351,532 $ 273,730 $ 151,417 As of December 31, 2017 , future minimum rentals to be received related to these noncancelable commercial agreements were as follows (in thousands): 2018 $ 359,842 2019 359,842 2020 360,828 2021 359,842 2022 359,842 Thereafter 2,899,476 Total minimum rental payments $ 4,699,672 Related Party Expenses The expenses incurred for services or financing provided to us by Valero are reflected in the supplemental information disclosure on our statements of income. Insurance Recoveries During 2017 , we experienced property damage losses and repair costs associated with Hurricane Harvey primarily at our Houston terminal and Port Arthur products system. As a result of these losses, we have submitted claims under our insurance policies with Valero. The amount shown in our statements of income as other operating expenses reflects the uninsured portion of our losses. For the year ended December 31, 2017 , we recognized $ 2.7 million of insurance recoveries, which were recorded as a reduction to other operating expenses. As of December 31, 2017 , we had an $ 828,000 receivable from Valero related to these property damage claims that was included in receivables – related party. Net Investment The following is a reconciliation of the amounts presented as net transfers from Valero on our statements of partners’ capital and statements of cash flows (in thousands). Year Ended December 31, 2017 2016 2015 Net transfers from Valero $ — $ 15,030 $ 70,334 Less: Noncash transfers from (to) Valero — 144 (6,950 ) Net transfers from Valero $ — $ 14,886 $ 77,284 See Note 13 for additional information related to our noncash transfers from (to) Valero. Concentration Risk All of our related party balances resulted from transactions with Valero. Therefore, we are subject to the business risks associated with Valero’s business. |
Property and Equipment
Property and Equipment | 12 Months Ended |
Dec. 31, 2017 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY AND EQUIPMENT | 4. PROPERTY AND EQUIPMENT Our property and equipment includes non-leased assets and assets under operating leases for which we are the lessor under U.S. GAAP. The increases in property and equipment as of December 31, 2017 were primarily due to the asset acquisitions as described in Note 2 . Major classes of property and equipment consisted of the following (in thousands): December 31, 2017 Non-Leased Assets Assets Leased to Valero Total Land $ 4,672 $ — $ 4,672 Pipelines and related assets 225,184 385,855 611,039 Terminals and related assets 134,362 1,162,718 1,297,080 Other 14,019 — 14,019 Construction in progress 42,423 — 42,423 Property and equipment, at cost 420,660 1,548,573 1,969,233 Accumulated depreciation (127,136 ) (425,681 ) (552,817 ) Property and equipment, net $ 293,524 $ 1,122,892 $ 1,416,416 December 31, 2016 Non-Leased Assets Assets Leased to Valero Total Land $ 4,672 $ — $ 4,672 Pipelines and related assets 224,656 47,366 272,022 Terminals and related assets 112,614 793,765 906,379 Other 9,538 — 9,538 Construction in progress 23,677 — 23,677 Property and equipment, at cost 375,157 841,131 1,216,288 Accumulated depreciation (115,538 ) (235,670 ) (351,208 ) Property and equipment, net $ 259,619 $ 605,461 $ 865,080 |
Debt and Notes Payable - Relate
Debt and Notes Payable - Related Party | 12 Months Ended |
Dec. 31, 2017 | |
Debt Disclosure [Abstract] | |
DEBT AND NOTES PAYABLE - RELATED PARTY | 5. DEBT AND NOTES PAYABLE – RELATED PARTY Debt Debt, at stated values, consisted of the following (in thousands): Final Maturity December 31, 2017 2016 Revolving credit facility 2020 $ 410,000 $ 30,000 Senior Notes, 4.375% 2026 500,000 500,000 Net unamortized discount and debt issuance costs (4,717 ) (4,645 ) Total debt $ 905,283 $ 525,355 Revolving Credit Facility We have a $750.0 million senior unsecured revolving credit facility (the Revolver) that matures in November 2020 . We have the option to increase the aggregate commitments under the Revolver to $1.0 billion , subject to certain restrictions. The Revolver also provides for the issuance of letters of credit of up to $100.0 million . Outstanding borrowings under the Revolver bear interest, at our option, at either (a) the adjusted LIBO rate (as defined in the Revolver) for the applicable interest period in effect from time to time plus the applicable margin or (b) the alternate base rate (as defined in the Revolver) plus the applicable margin. As of December 31, 2017 and 2016 , the variable rate was 2.875 percent and 2.3125 percent, respectively. Accrued interest is payable in arrears on each Interest Payment Date (as defined in the Revolver) and on the maturity date. The Revolver also requires payments for customary fees, including commitment fees, letter of credit participation fees, and administrative agent fees. The Revolver contains certain restrictive covenants, including a covenant that requires us to maintain a ratio of total debt to EBITDA (as defined in the Revolver) for the prior four fiscal quarters of not greater than 5.0 to 1.0 as of the last day of each fiscal quarter ( 5.5 to 1.0 during the specified period following certain acquisitions). The Revolver contains representations and warranties, affirmative and negative covenants, and events of default that are usual and customary for an agreement of this type that could, among other things, limit our ability to pay distributions to our unitholders. As a result of the Partnership obtaining an investment grade rating with respect to the issuance of its senior notes (described below) in December 2016, our directly owned subsidiary, Valero Partners Operating Co. LLC, was released of its guarantee under the Revolver. During the year ended December 31, 2017 , we borrowed $118.0 million and $262.0 million under the Revolver in connection with the acquisitions of Parkway Pipeline and the Port Arthur terminal, respectively, as described in Note 2 . During the year ended December 31, 2016 , we borrowed $139.0 million and $210.0 million under the Revolver in connection with the acquisitions of the McKee Terminal Services Business and the Meraux and Three Rivers Terminal Services Business, respectively, as described in Note 2 , and repaid $494.0 million under the Revolver from proceeds received on the issuance of the senior notes described below. During the year ended December 31, 2015 , we borrowed $200.0 million under the Revolver in connection with the acquisition of the Houston and St. Charles Terminal Services Business as described in Note 2 , and we repaid $25.0 million under the Revolver. As of December 31, 2017 and 2016 , we had no letters of credit outstanding and we incurred no debt issuance costs in connection with the Revolver. Senior Notes During the year ended December 31, 2016 , we issued in a public offering $500.0 million aggregate principal amount of our 4.375 percent Senior Notes due December 15, 2026 (Senior Notes). Gross proceeds from this debt issuance totaled $499.8 million before deducting the underwriting discount and other debt issuance costs totaling $4.5 million . Interest is payable semi-annually on June 15 and December 15. The Senior Notes are unsecured and contain various customary restrictive covenants that, among other things, limit our ability and the ability of our subsidiaries to create or permit to exist liens, or to enter into any sale and leaseback transactions, with respect to principal properties, and limit our ability to merge or consolidate with any other entity or transfer or dispose of all or substantially all of our assets. These covenants will be subject to a number of important qualifications and limitations. The Senior Notes are not currently guaranteed by any of our subsidiaries. If in the future any of our subsidiaries becomes a borrower or guarantor under, or grants any lien to secure any obligations pursuant to, the Revolver, then we will cause such subsidiary to guarantee the Senior Notes. Notes Payable – Related Party During 2015, we entered into two subordinated credit agreements with Valero (the Loan Agreements) under which we borrowed $160.0 million and $395.0 million (collectively, the loans) to finance a portion of the acquisitions of the Houston and St. Charles Terminal Services Business and the Corpus Christi Terminal Services Business, respectively, as described in Note 2 . The loans mature on March 1 and October 1, 2020 , respectively, and may be prepaid at any time without penalty. We are not permitted to reborrow amounts. The loans bear interest at the LIBO Rate (as defined in the Loan Agreements) plus the applicable margin. As of December 31, 2017 and 2016 , this variable rate was 2.86069 percent and 2.27 percent, respectively. Accrued interest is payable in arrears on each Interest Payment Date (as defined in the Loan Agreements) and on each maturity date. As a result of obtaining an investment grade rating with respect to the issuance of our Senior Notes in December 2016, our directly owned subsidiary, Valero Partners Operating Co. LLC, was released of its guarantee under the Loan Agreements. There was no activity under the Loan Agreements for the years ended December 31, 2017 and 2016 . During the year ended December 31, 2015 , we paid down $185.0 million under one of the loans maturing on October 1, 2020 . The outstanding balance of these Loan Agreements was $370.0 million as of December 31, 2017 and 2016 . The payment of amounts owed under the Loan Agreements are subordinated to our obligations under our Revolver with third-party lenders and our Senior Notes. The Loan Agreements contain customary terms regarding covenants, representations, default, and remedies, including covenants that limit the creation of liens, the incurrence of debt by us or our subsidiaries, the payment of distributions, and the entry into securitization transactions, sale/leaseback transactions, certain restrictive agreements, consolidations, mergers, and the sale of all or substantially all of our assets. The Loan Agreements also include covenants that require, as of the last day of each fiscal quarter, the ratio of Consolidated Total Debt (as defined in the Loan Agreements) to Consolidated EBITDA (as defined in the Loan Agreements) for the four -quarter period ending on such day not to exceed 5.0 to 1.0 (or 5.5 to 1.0 during a specified acquisition period). Other Disclosures Interest and debt expense, net of capitalized interest was as follows (in thousands): Year Ended December 31, 2017 2016 2015 Interest and debt expense incurred $ 36,634 $ 14,997 $ 6,144 Less: Capitalized interest 619 82 31 Interest and debt expense, net of capitalized interest $ 36,015 $ 14,915 $ 6,113 Principal maturities of our debt obligations and notes payable – related party as of December 31, 2017 were $780.0 million in 2020 and $500.0 million in 2026. |
Asset Retirement Obligations
Asset Retirement Obligations | 12 Months Ended |
Dec. 31, 2017 | |
Asset Retirement Obligation Disclosure [Abstract] | |
ASSET RETIREMENT OBLIGATIONS | 6. ASSET RETIREMENT OBLIGATIONS We have asset retirement obligations with respect to certain of our leased pipelines and terminals that require us to perform under law or contract once the asset is retired from service, and we have recognized obligations to restore these leased properties to substantially the same condition as when such property was delivered to us or to its improved condition as prescribed by the lease agreements. With respect to all other property and equipment, it is our practice and current intent to maintain these other property assets and continue to make improvements as warranted. As a result, we believe that these other property assets have indeterminate lives for purposes of estimating asset retirement obligations because dates or ranges of dates upon which we would retire these assets cannot reasonably be estimated at this time; therefore, no asset retirement obligations have been recorded for these other property assets as of December 31, 2017 and 2016 . We will recognize a liability at such time when sufficient information exists to estimate a range of potential settlement dates that is needed to employ a present value technique to estimate fair value. Changes in our asset retirement obligations were as follows (in thousands): December 31, 2017 2016 2015 Balance as of beginning of year $ 1,069 $ 1,021 $ 975 Accretion expense 30 48 46 Balance as of end of year $ 1,099 $ 1,069 $ 1,021 We do not expect any short-term spending and, as a result, there is no current liability reported for asset retirement obligations as of December 31, 2017 and 2016 . Accretion expense is reflected in depreciation expense. There are no assets that are legally restricted for purposes of settling our asset retirement obligations. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | 7. COMMITMENTS AND CONTINGENCIES Operating Leases – Lessee We have long-term operating lease commitments for pipelines and land used in the terminaling and transportation of crude oil and refined petroleum products. Certain leases contain escalation clauses and renewal options that allow for the same rental payment over the lease term or a revised rental payment based on fair rental value or negotiated value. Currently, one of our leases with Valero does not contain a renewal option. We expect our leases will be renewed or replaced by other leases in the normal course of business. As of December 31, 2017 , our future minimum rentals for leases having initial or remaining noncancelable lease terms in excess of one year were as follows (in thousands): Agreements With Related Party Others Total 2018 $ 13,241 $ 856 $ 14,097 2019 13,177 1,112 14,289 2020 13,147 1,111 14,258 2021 13,116 1,099 14,215 2022 13,115 1,099 14,214 Thereafter 276,967 24,639 301,606 Total minimum rental payments $ 342,763 $ 29,916 $ 372,679 Minimum rental expenses for all operating leases are shown in the following table (in thousands). Contingent rental expense for all operating leases was immaterial. Year Ended December 31, 2017 2016 2015 Minimum rental expenses – related party $ 10,308 $ 8,946 $ 5,803 Minimum rental expenses – others 1,392 815 1,327 Total minimum rental expenses $ 11,700 $ 9,761 $ 7,130 Purchase Obligations We have purchase obligations under our amended and restated (i) omnibus agreement, (ii) services and secondment agreement, and (iii) lease and access agreement with Valero. See Note 3 for additional information regarding our agreements with Valero. Our purchase obligations are determined based on contractual, fixed-rate fees for periods that are reasonably assured based on current market conditions. None of these obligations are associated with suppliers’ financing arrangements. These purchase obligations are not reflected as liabilities. Litigation Matters From time to time, we may be party to claims and legal proceedings arising in the ordinary course of business. We also may be required by existing laws and regulations to report the release of hazardous substances and begin a remediation study. We have not recorded a loss contingency liability as there are no matters for which a loss has been incurred. We re-evaluate and update our loss contingency liabilities as matters progress over time, and we believe that any changes to the recorded liabilities will not be material to our financial position, results of operations, or liquidity. |
Cash Distributions
Cash Distributions | 12 Months Ended |
Dec. 31, 2017 | |
Partners' Capital [Abstract] | |
CASH DISTRIBUTIONS | 8. CASH DISTRIBUTIONS Our partnership agreement prescribes the amount and priority of cash distributions that the limited partners and general partner will receive. Our distributions are declared subsequent to quarter end. The following table summarizes information related to our quarterly cash distributions: Quarterly Period Ended Total Quarterly Distribution (Per Unit) Total Cash Distribution (In Thousands) Declaration Date Record Date Distribution Date December 31, 2017 $ 0.5075 $ 50,055 January 24, 2018 February 5, 2018 February 13, 2018 September 30, 2017 0.4800 46,242 October 19, 2017 November 1, 2017 November 9, 2017 June 30, 2017 0.4550 42,111 July 19, 2017 August 1, 2017 August 10, 2017 March 31, 2017 0.4275 38,043 April 20, 2017 May 2, 2017 May 11, 2017 December 31, 2016 0.4065 34,895 January 20, 2017 February 2, 2017 February 10, 2017 September 30, 2016 0.3850 32,175 October 24, 2016 November 3, 2016 November 10, 2016 June 30, 2016 0.3650 28,912 July 21, 2016 August 1, 2016 August 9, 2016 March 31, 2016 0.3400 25,608 April 21, 2016 May 2, 2016 May 10, 2016 December 31, 2015 0.3200 22,711 January 25, 2016 February 4, 2016 February 11, 2016 September 30, 2015 0.3075 20,164 October 15, 2015 November 2, 2015 November 10, 2015 June 30, 2015 0.2925 18,456 July 24, 2015 August 3, 2015 August 11, 2015 March 31, 2015 0.2775 17,266 April 21, 2015 May 1, 2015 May 12, 2015 December 31, 2014 0.2660 15,829 January 26, 2015 February 5, 2015 February 12, 2015 The following table reflects the allocation of total cash distributions to the general and limited partners and distribution equivalent right (DER) payments (see Notes 9 and 11 for a description of DERs) applicable to the period in which the distributions and DERs were earned (in thousands): Year Ended December 31, 2017 2016 2015 General partner’s distributions: General partner’s distributions $ 3,363 $ 2,294 $ 1,572 General partner’s incentive distribution rights (IDRs) 44,534 19,354 3,431 Total general partner’s distributions 47,897 21,648 5,003 Limited partners’ distributions: Common – public 42,029 32,362 22,016 Common – Valero 86,503 47,263 17,090 Subordinated – Valero — 20,297 34,476 Total limited partners’ distributions 128,532 99,922 73,582 DERs 22 20 12 Total cash distributions, including DERs $ 176,451 $ 121,590 $ 78,597 |
Net Income Per Limited Partner
Net Income Per Limited Partner Unit | 12 Months Ended |
Dec. 31, 2017 | |
Earnings Per Share [Abstract] | |
NET INCOME PER LIMITED PARTNER UNIT | 9. NET INCOME PER LIMITED PARTNER UNIT We calculate net income available to limited partners based on the distributions pertaining to each period’s net income. After considering the appropriate period’s distributions, the remaining undistributed earnings or excess distributions over earnings, if any, are allocated to the general partner, limited partners, and other participating securities in accordance with the contractual terms of our partnership agreement and as prescribed under the two-class method. Participating securities include IDRs and awards under our 2013 ICP (defined in Note 11 ) that receive DERs, as further discussed in Note 11 . However, the terms of our partnership agreement limit the general partner’s incentive distribution to the amount of available cash, which, as defined in our partnership agreement, is net of reserves deemed appropriate. As such, IDRs are not allocated undistributed earnings or distributions in excess of earnings in the calculation of net income per limited partner unit. Net losses of our Predecessor are allocated to the general partner. Subsequent to the effective dates of the acquisitions from Valero, we calculate net income available to limited partners based on the methodology described above. Basic net income per limited partner unit is determined pursuant to the two-class method for master limited partnerships. The two-class method is an earnings allocation formula that is used to determine earnings to our general partner, common unitholders, and participating securities according to (i) distributions pertaining to each period’s net income and (ii) participation rights in undistributed earnings. Diluted net income per limited partner unit is also determined using the two-class method, unless the treasury stock method is more dilutive. For the years ended December 31, 2017 , 2016 , and 2015 , we used the two-class method to determine diluted net income per limited partner unit. We did not have any potentially dilutive instruments outstanding during the years ended December 31, 2017 , 2016 , and 2015 . Effective August 10, 2016 , all of our subordinated units, which were owned by Valero, were converted on a one-for-one basis into common units. The subordinated units were only allocated earnings generated by us through the conversion date. See Note 10 for further discussion of the conversion of subordinated units. Net income per unit was computed as follows (in thousands, except per unit amounts): Year Ended December 31, 2017 General Limited Partner Common Restricted Total Allocation of net income to determine net income available to limited partners: Distributions, excluding general partner’s IDRs $ 3,363 $ 128,532 $ — $ 131,895 General partner’s IDRs 44,534 — — 44,534 DERs — — 22 22 Distributions and DERs declared 47,897 128,532 22 176,451 Undistributed earnings 1,216 60,756 10 61,982 Net income available to $ 49,113 $ 189,288 $ 32 $ 238,433 Net income per limited partner unit – basic and diluted: Weighted-average units outstanding 68,220 Net income per limited partner unit – basic and diluted $ 2.77 Year Ended December 31, 2016 Limited Partners General Partner Common Units Subordinated Units Restricted Units Total Allocation of net income to determine net income available to limited partners: Distributions, excluding general partner’s IDRs $ 2,294 $ 79,625 $ 20,297 $ — $ 102,216 General partner’s IDRs 19,354 — — — 19,354 DERs — — — 20 20 Distributions and DERs declared 21,648 79,625 20,297 20 121,590 Undistributed earnings 1,905 59,452 21,289 17 82,663 Net income available to limited partners – basic and diluted $ 23,553 $ 139,077 $ 41,586 $ 37 $ 204,253 Net income per limited partner unit – basic and diluted: Weighted-average units outstanding 48,817 17,463 Net income per limited partner unit – basic and diluted $ 2.85 $ 2.38 Year Ended December 31, 2015 Limited Partners General Partner Common Units Subordinated Units Restricted Units Total Allocation of net income to determine net income available to limited partners: Distributions, excluding general partner’s IDRs $ 1,572 $ 39,106 $ 34,476 $ — $ 75,154 General partner’s IDRs 3,431 — — — 3,431 DERs — — — 12 12 Distributions and DERs declared 5,003 39,106 34,476 12 78,597 Undistributed earnings 1,066 27,162 25,045 8 53,281 Net income available to limited partners – basic and diluted $ 6,069 $ 66,268 $ 59,521 $ 20 $ 131,878 Net income per limited partner unit – basic and diluted: Weighted-average units outstanding 31,222 28,790 Net income per limited partner unit – basic and diluted $ 2.12 $ 2.07 |
Partners' Capital
Partners' Capital | 12 Months Ended |
Dec. 31, 2017 | |
Partners' Capital Notes [Abstract] | |
PARTNERS' CAPITAL | 10. PARTNERS’ CAPITAL Unit Activity Activity in the number of units was as follows: Common General Partner Public Valero Subordinated Total Balance as of December 31, 2014 17,255,208 11,539,989 28,789,989 1,175,102 58,760,288 Unit-based compensation 4,443 — — — 4,443 Units issued in connection with acquisitions (see Note 2) — 3,478,613 — 70,992 3,549,605 Unit issuance 4,250,000 — — — 4,250,000 General partner units issued to maintain 2% interest — — — 86,735 86,735 Balance as of December 31, 2015 21,509,651 15,018,602 28,789,989 1,332,829 66,651,071 Unit-based compensation 5,958 — — — 5,958 Units issued in connection with acquisitions (see Note 2) — 1,878,680 — 38,340 1,917,020 Conversion of subordinated units — 28,789,989 (28,789,989 ) — — Units issued under ATM Program 223,083 — — — 223,083 General partner units issued to maintain 2% interest — — — 4,552 4,552 Balance as of December 31, 2016 21,738,692 45,687,271 — 1,375,721 68,801,684 Unit-based compensation (see Note 11) 5,997 — — — 5,997 Units issued in connection with acquisitions (see Note 2) — 1,081,315 — 22,068 1,103,383 Units issued under ATM Program 742,897 — — — 742,897 General partner units issued to maintain 2% interest — — — 15,602 15,602 Balance as of December 31, 2017 22,487,586 46,768,586 — 1,413,391 70,669,563 ATM Program On September 16, 2016 , we entered into an equity distribution agreement pursuant to which we may offer and sell from time to time our common units having an aggregate offering price of up to $350.0 million based on amounts, at prices, and on terms to be determined by market conditions and other factors at the time of our offerings (such continuous offering program, or at-the-market program, referred to as our “ATM Program”). As of December 31, 2017 , we have sold common units having an aggregate value of $45.5 million under our ATM Program, resulting in $304.5 million remaining available. The following table summarizes activities of the common units issued under our ATM Program and general partner units issued to maintain the 2.0 percent general partner interest in the Partnership (in thousands, except unit amounts): Units Total Offering Net Year ended December 31, 2017: Common – public 742,897 $ 35,728 $ 594 $ 35,134 General partner 15,602 748 — 748 Year ended December 31, 2016: Common – public 223,083 9,724 107 9,617 General partner 4,552 198 — 198 The 2015 Offering On November 24, 2015 , we completed a public offering (the 2015 Offering) of 4,250,000 of our common units at a price of $46.25 per unit and received gross proceeds of $196.6 million . After deducting the underwriting discount and other offering costs totaling $7.7 million , our net proceeds were $188.9 million . Concurrent with the 2015 Offering, our general partner contributed $4.0 million in exchange for 86,735 general partner units to maintain its 2.0 percent general partner interest in the Partnership. Subordinated Unit Conversion The requirements under our partnership agreement for the conversion of all of our outstanding subordinated units into common units were satisfied upon the payment of our quarterly cash distribution on August 9, 2016 . Therefore, effective August 10, 2016 , all of our subordinated units, which were owned by Valero, were converted on a one-for-one basis into common units. The conversion of the subordinated units does not impact the amount of cash distributions paid or the total number of outstanding units. Transfers to (from) Partners Subsequent to the expiration of the subordination period on August 10, 2016, all of our common units have equal rights, including rights to distributions and to our net assets in the event of liquidation. As a result, a reallocation of the carrying values of our public common unitholders’ interest in us and Valero’s common unitholder interest in us is required when a change in ownership occurs in order for the portion of those carrying values associated with activity subsequent to the subordination period to be equal to the respective unitholders’ ownership interests (in units) in us. The transfers to (from) partners resulted from the issuance of equity to Valero in connection with our acquisitions from Valero (as described in Note 2 ) and the issuance of equity under our ATM Program. |
Unit-based Compensation
Unit-based Compensation | 12 Months Ended |
Dec. 31, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
UNIT-BASED COMPENSATION | 11. UNIT-BASED COMPENSATION Overview Our general partner maintains the Valero Energy Partners LP 2013 Incentive Compensation Plan (2013 ICP) under which various unit and unit-based awards may be granted to employees and non-employee directors. Awards under the 2013 ICP may include, but are not limited to, options to purchase common units, performance awards that vest upon the achievement of an objective performance goal, unit appreciation rights, and restricted units that vest over a period determined by the plan. The 2013 ICP was approved by the board of directors and the sole member of our general partner on November 26, 2013 . As of December 31, 2017 , 2,978,394 common units were available to be awarded under the 2013 ICP. Restricted Units Restricted units have been granted to each of our three independent directors ( i.e ., participants) in tandem with an equal number of DERs. The restricted units vest in accordance with individual written agreements between the participants and us, usually in equal one-third increments on each anniversary of the restricted units’ grant date. The DERs entitle the participant to a cash payment equal to the cash distribution per unit paid on our outstanding common units and is paid to the participant in cash as of each record payment date during the period the restricted units are outstanding. Unit-based compensation expense associated with these restricted units was $266,000 , $196,000 , and $173,000 for the years ended December 31, 2017 , 2016 , and 2015 , respectively, and is recorded within general and administrative expenses on our statements of income. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | 12. INCOME TAXES Components of income tax expense were as follows (in thousands): Year Ended December 31, 2017 2016 2015 Current U.S. state $ 942 $ 704 $ 479 Deferred U.S. state 393 408 (228 ) Income tax expense $ 1,335 $ 1,112 $ 251 We are not a taxable entity for U.S. federal income tax purposes or for the majority of states that impose an income tax. Taxes on our net income generally are borne by our partners through the allocation of taxable income. Our income tax expense results from state laws that apply to entities organized as partnerships, specifically in the state of Texas. The difference between income tax expense recorded by us and income taxes computed by applying the statutory federal income tax rate ( 35 percent for all years presented) to income before income tax expense is due to the fact that the majority of our income is not subject to federal income tax at the entity level as described above. As of December 31, 2017 and 2016 , we had no liability reported for unrecognized tax benefits. We did not have any interest or penalties related to income taxes during the years ended December 31, 2017 , 2016 , and 2015 . |
Supplemental Cash Flow Informat
Supplemental Cash Flow Information | 12 Months Ended |
Dec. 31, 2017 | |
Supplemental Cash Flow Information [Abstract] | |
SUPPLEMENTAL CASH FLOW INFORMATION | 13. SUPPLEMENTAL CASH FLOW INFORMATION In order to determine net cash provided by operating activities, net income is adjusted by, among other things, changes in current assets and current liabilities as follows (in thousands): Year Ended December 31, 2017 2016 2015 Decrease (increase) in current assets: Receivables – related party $ (9,607 ) $ (10,786 ) $ (15,588 ) Receivables (781 ) — — Prepaid expenses and other 277 (365 ) 95 Increase (decrease) in current liabilities: Accounts payable 7,411 586 (631 ) Accounts payable – related party (3,404 ) (667 ) 5,999 Accrued liabilities 137 34 (87 ) Accrued liabilities – related party 10 40 21 Accrued interest payable 1,278 1,054 226 Accrued interest payable – related party 864 (429 ) 476 Taxes other than income taxes payable 2,684 1,181 511 Deferred revenue – related party (2,599 ) 3,396 5 Changes in current assets and current liabilities $ (3,730 ) $ (5,956 ) $ (8,973 ) Cash flows related to interest and income taxes paid were as follows (in thousands): Year Ended December 31, 2017 2016 2015 Interest paid $ 33,355 $ 13,873 $ 5,367 Income taxes paid 719 505 441 The following table presents our investing and financing cash outflows in connection with the acquisitions from Valero as described in Note 2 (in thousands). Of the cash consideration paid, the portion attributed to Valero’s historical carrying value of each acquisition was reflected as an investing cash outflow and the excess purchase price paid over the carrying value of each acquisition was reflected as a financing cash outflow. Investing Financing Total Year ended December 31, 2017: Parkway Pipeline $ 200,249 $ — $ 200,249 Port Arthur terminal 207,595 54,618 262,213 $ 407,844 $ 54,618 $ 462,462 Year ended December 31, 2016: McKee Terminal Services Business $ 51,361 $ 152,639 $ 204,000 Meraux and Three Rivers Terminal Services Business 52,246 223,754 276,000 $ 103,607 $ 376,393 $ 480,000 Year ended December 31, 2015: Houston and St. Charles Terminal Services Business $ 296,109 $ 275,111 $ 571,220 Corpus Christi Terminal Services Business 94,035 300,965 395,000 $ 390,144 $ 576,076 $ 966,220 Noncash investing and financing activities that affected recognized assets or liabilities were as follows (in thousands): Year Ended December 31, 2017 2016 2015 Transfer (from) to Valero for: Deferred income taxes $ — $ (190 ) $ (282 ) Change in accrued capital expenditures — 46 7,232 Noncash contributions from Valero: Excess of carrying value over purchase price paid for acquisition of Parkway Pipeline (see Note 2) 51,702 — — Capital projects 41,305 35,732 27,748 Increase in accounts payable related to capital expenditures 570 904 5,496 Units issued to Valero in connection with acquisitions (see Note 2) 46,000 85,000 170,000 Offering costs included in accounts payable — — (102 ) Units issued under ATM Program included in receivables — 1,682 — In addition to the activities in the preceding table, noncash financing activities included: • the transfers to (from) partners to reflect the impact of ownership changes occurring as a result of the issuance of equity (i) to Valero in connection with our acquisitions from Valero as described in Note 2 and (ii) under our ATM Program as described in Note 10 for the years ended December 31, 2017 and 2016 ; and • the conversion of all of our outstanding subordinated units into common units having an aggregate value of $406.4 million described in Note 10 for the year ended December 31, 2016 . |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 12 Months Ended |
Dec. 31, 2017 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE OF FINANCIAL INSTRUMENTS | 14. FAIR VALUE OF FINANCIAL INSTRUMENTS Financial instruments that we recognize in our balance sheets at their carrying amounts are shown in the following table along with their associated fair values (in thousands): December 31, 2017 December 31, 2016 Carrying Amount Fair Value Carrying Amount Fair Value Financial assets: Cash and cash equivalents $ 42,052 $ 42,052 $ 71,491 $ 71,491 Financial liabilities: Debt: Revolver 410,000 410,000 30,000 30,000 Senior Notes 495,283 523,800 495,355 506,670 Notes payable – related party 370,000 370,000 370,000 370,000 The methods and significant assumptions used to estimate the fair value of these financial instruments are as follows: • The fair value of cash and cash equivalents approximates the carrying value due to the low level of credit risk of these assets combined with their market interest rates. The fair value measurement for cash and cash equivalents is categorized as Level 1 in the fair value hierarchy. Fair values determined by Level 1 inputs utilize unadjusted quoted prices in active markets for identical assets. • The fair values of our variable-rate debt, which includes our Revolver and notes payable – related party, approximate their carrying values as our borrowings bear interest based upon short-term floating market interest rates. The fair value of our fixed-rate 4.375 percent Senior Notes is determined primarily using the market approach based on quoted prices provided by vendor pricing services. The fair value measurement for these liabilities is categorized as Level 2 in the fair value hierarchy. Fair values determined by Level 2 utilize inputs that are observable for the asset or liability, either directly or indirectly. These include quoted prices for similar assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active. |
Quarterly Financial Data (Unaud
Quarterly Financial Data (Unaudited) | 12 Months Ended |
Dec. 31, 2017 | |
Quarterly Financial Information Disclosure [Abstract] | |
QUARTERLY FINANCIAL DATA (UNAUDITED) | 15. QUARTERLY FINANCIAL DATA (UNAUDITED) The following tables summarize quarterly financial data for the years ended December 31, 2017 and 2016 (in thousands, except per unit amounts): 2017 Quarter Ended March 31 June 30 September 30 December 31 Operating revenues – related party $ 105,816 $ 110,545 $ 109,340 $ 126,304 Gross profit (a) 70,496 70,985 70,749 78,926 Operating income 66,666 67,122 66,347 74,895 Net income 58,137 58,443 57,589 64,264 Net income attributable to partners 58,137 58,443 57,589 64,264 Limited partners’ interest in net income 48,670 47,024 44,552 49,074 Net income per limited partner unit – basic and diluted: Common units 0.72 0.69 0.65 0.71 2016 Quarter Ended March 31 June 30 September 30 December 31 Operating revenues – related party $ 78,767 $ 87,664 $ 92,040 $ 104,148 Gross profit (a) 42,969 51,757 56,632 69,181 Operating income 38,604 48,042 52,538 65,390 Net income 35,780 44,545 48,707 59,799 Net income attributable to partners 43,298 49,447 51,709 59,799 Limited partners’ interest in net income 39,794 44,234 45,075 51,597 Net income per limited partner unit – basic and diluted: Common units 0.61 0.67 0.77 0.77 Subordinated units 0.61 0.67 0.29 — (a) Gross profit is calculated as operating revenues – related party less cost of revenues (excluding depreciation expense) and depreciation expense. |
Description of Business, Basi23
Description of Business, Basis of Presentation, and Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation General These consolidated financial statements were prepared in accordance with U.S. generally accepted accounting principles (GAAP) and with the rules and regulations of the U.S. Securities and Exchange Commission. Acquisitions from Valero Certain of our acquisitions from Valero, as described in Note 2 , were accounted for as transfers of businesses between entities under the common control of Valero. Accordingly, we recorded these business acquisitions on our balance sheet at Valero’s carrying value as of the beginning of the period of transfer, and we retrospectively adjusted prior period financial statements and financial information to furnish comparative information. We refer to the historical results of the transferred businesses from Valero prior to their transfer to us as those of our “Predecessor.” The combined financial statements of our Predecessor were derived from the consolidated financial statements and accounting records of Valero and reflect the combined historical financial position, results of operations, and cash flows of our Predecessor as if the acquisitions from Valero had been combined for periods prior to the effective dates of each acquisition. There were no transactions between the operations of our Predecessor; therefore, there were no intercompany transactions or accounts to be eliminated in connection with the combination of those operations. In addition, our Predecessor’s statements of income include direct charges for the management and operation of our assets and certain expenses allocated by Valero for general corporate services, such as treasury, accounting, and legal services. These expenses were charged, or allocated, to our Predecessor based on the nature of the expenses. Prior to the acquisitions from Valero, our Predecessor transferred cash to Valero daily and Valero funded our Predecessor’s operating and investing activities as needed. Therefore, transfers of cash to and from Valero’s cash management system are reflected as a component of net investment and are reflected as a financing activity in our statements of cash flows. In addition, interest expense was not included on the net cash transfers from Valero. The acquisitions of Parkway Pipeline LLC (Parkway Pipeline) and the Port Arthur terminal (defined in Note 2 ) from Valero on November 1, 2017 were accounted for as transfers of assets between entities under the common control of Valero. Accordingly, we recorded these asset acquisitions on our balance sheet at Valero’s carrying value as of the acquisition date, and our prior period financial statements and financial information were not retrospectively adjusted for these acquisitions. The financial information presented for the periods after the effective dates of each acquisition represents the consolidated financial position, results of operations, and cash flows of the Partnership. |
Reclassifications | Reclassifications Certain prior year amounts have been reclassified to conform to the 2017 presentation. |
Principles of Consolidation | Principles of Consolidation Our consolidated financial statements include the accounts of the Partnership, our subsidiaries, and our Predecessor. All intercompany items and transactions have been eliminated. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from these estimates. On an ongoing basis, we review our estimates based on currently available information. Changes in facts and circumstances may result in revised estimates. |
Cash Equivalents | Cash Equivalents Our cash equivalents are highly liquid investments that have a maturity of three months or less when acquired. |
Receivables - Related Party | Receivables – Related Party Receivables – related party include trade receivables from Valero for transportation and terminaling services provided under various agreements with Valero, as more fully described in Note 3 . These receivables are recorded at the original invoice amount. |
Property and Equipment | Property and Equipment The cost of property and equipment purchased or constructed, including betterments of property and equipment, is capitalized. However, the cost of repairs to and normal maintenance of property and equipment is expensed when incurred. Betterments of property and equipment are those that extend the useful lives of the property and equipment or improve the safety of our operations. The cost of property and equipment constructed includes interest and certain overhead costs allocable to the construction activities. Property and equipment also includes our undivided interest in certain assets. When property and equipment are retired or replaced, the cost and related accumulated depreciation are eliminated, with any gain or loss reflected in depreciation expense, unless such amounts are reported separately due to materiality. Depreciation of property and equipment is recorded on a straight-line basis over the estimated useful lives of the related assets. Leasehold improvements are amortized on a straight-line basis over the shorter of the lease term or the estimated useful life of the related asset. |
Impairment of Assets | Impairment of Assets Long-lived assets are tested for recoverability whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable. A long-lived asset is not recoverable if its carrying amount exceeds the sum of the undiscounted cash flows expected to result from its use and eventual disposition. If a long-lived asset is not recoverable, an impairment loss is recognized for the amount by which the carrying amount of the long-lived asset exceeds its fair value, with fair value determined based on discounted estimated net cash flows or other appropriate methods. |
Asset Retirement Obligations | Asset Retirement Obligations We record a liability, which is referred to as an asset retirement obligation, at fair value for the estimated cost to retire a tangible long-lived asset at the time we incur that liability, which is generally when the asset is purchased, constructed, or leased. We record the liability when we have a legal obligation to incur costs to retire the asset and when a reasonable estimate of the fair value of the liability can be made. If a reasonable estimate cannot be made at the time the liability is incurred, we record the liability when sufficient information is available to estimate the liability’s fair value. |
Environmental Matters | Environmental Matters Liabilities for future remediation costs are recorded when environmental assessments and/or remedial efforts are probable and the costs can be reasonably estimated. Other than for assessments, the timing and magnitude of these accruals generally are based on the completion of investigations or other studies or a commitment to a formal plan of action. Amounts recorded for environmental liabilities have not been reduced by possible recoveries from third parties and have not been measured on a discounted basis. |
Net Investment | Net Investment Net investment represents Valero’s historical investment in our Predecessor, its accumulated net earnings after taxes, and the net effect of transactions and allocations between our Predecessor and Valero. There were no terms of settlement or interest charges associated with the net investment balance. |
Revenue Recognition | Revenue Recognition We generate operating revenues by providing fee-based transportation and terminaling services to transport and store crude oil and refined petroleum products using our pipelines and terminals under long-term commercial agreements (defined in Note 3 ). Operating revenues are recognized upon completion of the transportation or terminaling service. Certain of these commercial agreements are considered operating leases under U.S. GAAP. Lease revenue is recognized over the lease term and contingent lease revenue is recognized after minimum monthly volume commitment requirements on these leases have been met. As further described in Note 3 , certain of our commercial agreements contain minimum volume commitments. Under these commercial agreements, if our customer fails to transport its minimum throughput volumes during any quarter, then the customer will pay us a deficiency payment equal to the volume of the deficiency multiplied by the contractual rate then in effect. The deficiency payment is initially recorded as deferred revenue – related party on our balance sheets. Our customer may apply the amount of any such deficiency payments as a credit for volumes transported on the applicable pipeline or terminal system in excess of its minimum volume commitment during the following four quarters under the terms of the applicable agreement. We recognize operating revenues for the deficiency payments when credits are used for volumes transported in excess of minimum volume commitments. If we determine, based on all available information, that it is remote that our customer will utilize these payments, the amount of the expected unused credits will be recognized as operating revenues in the period when that determination is made. The use or recognition of the credits is a reduction to deferred revenue – related party. |
Income Taxes | Income Taxes Our operations are treated as a partnership for federal and state income tax purposes, with each partner being separately taxed on its share of taxable income. Therefore, we have excluded income taxes from these financial statements, except for state taxes that apply to partnerships, specifically the margin tax in Texas. Our Predecessor’s taxable income was included in the consolidated U.S. federal income tax returns of Valero and in certain consolidated state income tax returns. Income taxes are accounted for under the asset and liability method, as if we were a separate taxpayer rather than a member of Valero’s consolidated tax return. Under this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred amounts are measured using enacted tax rates expected to apply to taxable income in the year those temporary differences are expected to be recovered or settled. We classify any interest expense and penalties related to the underpayment of income taxes in income tax expense. |
Net Income per Limited Partner Unit | Net Income per Limited Partner Unit Basic and diluted net income per limited partner unit is determined pursuant to the two-class method for master limited partnerships as further described in Note 9 . We calculate net income available to limited partners based on the distributions pertaining to each period’s net income. After considering the appropriate period’s distributions, the remaining undistributed earnings or excess distributions over earnings, if any, are allocated to the general partner, limited partners, and other participating securities in accordance with the contractual terms of our partnership agreement and as prescribed under the two-class method. Participating securities include IDRs and awards under our 2013 ICP (defined in Note 11 ) that receive DERs, as further discussed in Note 11 . However, the terms of our partnership agreement limit the general partner’s incentive distribution to the amount of available cash, which, as defined in our partnership agreement, is net of reserves deemed appropriate. As such, IDRs are not allocated undistributed earnings or distributions in excess of earnings in the calculation of net income per limited partner unit. Net losses of our Predecessor are allocated to the general partner. Subsequent to the effective dates of the acquisitions from Valero, we calculate net income available to limited partners based on the methodology described above. Basic net income per limited partner unit is determined pursuant to the two-class method for master limited partnerships. The two-class method is an earnings allocation formula that is used to determine earnings to our general partner, common unitholders, and participating securities according to (i) distributions pertaining to each period’s net income and (ii) participation rights in undistributed earnings. Diluted net income per limited partner unit is also determined using the two-class method, unless the treasury stock method is more dilutive. |
Comprehensive Income | Comprehensive Income We have not reported comprehensive income due to the absence of items of other comprehensive income in the years presented. |
Segment Reporting | Segment Reporting Our operations consist of one reportable segment. All of our operations are conducted and all of our assets are located in the U.S. |
Financial Instruments | Financial Instruments Our financial instruments include cash and cash equivalents, receivables, receivables – related party, accounts payable, accounts payable – related party, debt, and notes payable – related party. The estimated fair values of these financial instruments approximate their carrying amounts, except for certain debt as discussed in Note 14 . The methods and significant assumptions used to estimate the fair value of these financial instruments are as follows: • The fair value of cash and cash equivalents approximates the carrying value due to the low level of credit risk of these assets combined with their market interest rates. The fair value measurement for cash and cash equivalents is categorized as Level 1 in the fair value hierarchy. Fair values determined by Level 1 inputs utilize unadjusted quoted prices in active markets for identical assets. • The fair values of our variable-rate debt, which includes our Revolver and notes payable – related party, approximate their carrying values as our borrowings bear interest based upon short-term floating market interest rates. The fair value of our fixed-rate 4.375 percent Senior Notes is determined primarily using the market approach based on quoted prices provided by vendor pricing services. The fair value measurement for these liabilities is categorized as Level 2 in the fair value hierarchy. Fair values determined by Level 2 utilize inputs that are observable for the asset or liability, either directly or indirectly. These include quoted prices for similar assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active. |
Business Combinations | Business Combinations We adopted the provisions of Accounting Standards Update (ASU) No. 2017-01, “Business Combinations (Topic 805),” issued by the Financial Accounting Standards Board (FASB), on January 1, 2017. This ASU provides a more robust framework to evaluate whether transactions should be accounted for as acquisitions (dispositions) of assets or businesses. Our adoption of this ASU resulted in the acquisitions of Parkway Pipeline and the Port Arthur terminal being accounted for as acquisitions of assets. See further discussion of these acquisitions in Note 2 . In addition, more of our future acquisitions may be accounted for as acquisitions of assets in accordance with this ASU. |
New accounting pronouncements | Accounting Pronouncements Adopted on January 1, 2018 ASU No. 2014-09 In May 2014, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606),” to clarify the principles for recognizing revenue. This new standard is effective for annual reporting periods beginning after December 15, 2017, including interim reporting periods within those annual periods. We adopted this standard on January 1, 2018, and it will not materially change the amount or timing of revenues recognized by us, nor will it materially affect our financial position. We generate operating revenues by providing fee-based transportation and terminaling services to transport and store crude oil and refined petroleum products using our pipelines and terminals under long-term commercial agreements. Revenues from contracts with customers are recognized over time as our performance obligation is satisfied. Revenue is measured as the amount of consideration we expect to receive in exchange for providing the service. Certain of our commercial agreements are considered operating leases under U.S. GAAP. The scope of this new standard does not extend to revenues generated by lease arrangements; therefore, lease revenues generated by us will continue to be accounted for under existing lease accounting standards but will be reflected in a separate revenue line item on our statements of income. We adopted this new standard on January 1, 2018 using the modified retrospective method, as permitted by the standard. Under this method, the cumulative effect of initially applying the standard is recognized as an adjustment to the opening balance of partners’ capital, and revenues reported in the periods prior to the date of adoption are not changed. Because the adoption of this standard did not materially impact the manner in which we recognize revenues, we will not make such an adjustment to partners’ capital. We continue to develop our revenue disclosures and have enhanced our accounting systems to enable the preparation of such disclosures. ASU No. 2016-01 In January 2016, the FASB issued ASU No. 2016-01, “Financial Instruments—Overall (Subtopic 825-10),” to enhance the reporting model for financial instruments regarding certain aspects of recognition, measurement, presentation, and disclosure. The provisions of this ASU are effective for annual reporting periods beginning after December 15, 2017, and interim reporting periods within those annual periods. This ASU is to be applied using a cumulative-effect adjustment to the balance sheet as of the beginning of the year of adoption. The adoption of this ASU effective January 1, 2018 did not affect our financial position nor will it affect our results of operations, but it will result in revised disclosures. Accounting Pronouncements Not Yet Adopted ASU No. 2016-02 In February 2016, the FASB issued ASU No. 2016-02, “Leases (Topic 842),” to increase the transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. This new standard is effective for annual reporting periods beginning after December 15, 2018, and interim reporting periods within those annual periods, with early adoption permitted. We will adopt this new standard on January 1, 2019, and we expect to use the modified retrospective method of adoption. We are enhancing our contracting and lease evaluation systems and related processes, and we are developing a new lease accounting system to capture our leases and support the required disclosures. During 2018, we will continue to monitor the adoption process to ensure compliance with the accounting and disclosure requirements. We also continue the integration of our lease accounting system with our general ledger, and we will make modifications to the related procurement and payment processes. We anticipate this standard will have a material impact on our financial position, but we do not expect adoption to have a material impact on our results of operations or liquidity. While we continue to assess potential impacts of the standard, we currently expect the most significant impact will be the recognition of right-of-use assets and lease liabilities for operating leases. |
Related-Party Agreements and 24
Related-Party Agreements and Transactions (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Related Party Transactions [Abstract] | |
Summary of related-party transactions | Operating revenues – related party disaggregated by activity type were as follows (in thousands): Year Ended December 31, 2017 2016 2015 Pipeline transportation revenues $ 100,631 $ 78,451 $ 81,435 Terminaling revenues 347,996 283,628 161,649 Storage and other revenues 3,378 540 540 Total operating revenues – related party $ 452,005 $ 362,619 $ 243,624 The following is a reconciliation of the amounts presented as net transfers from Valero on our statements of partners’ capital and statements of cash flows (in thousands). Year Ended December 31, 2017 2016 2015 Net transfers from Valero $ — $ 15,030 $ 70,334 Less: Noncash transfers from (to) Valero — 144 (6,950 ) Net transfers from Valero $ — $ 14,886 $ 77,284 The components of our lease revenues were as follows (in thousands): Year Ended December 31, 2017 2016 2015 Minimum rental revenues $ 292,034 $ 232,211 $ 128,468 Contingent rental revenues 59,498 41,519 22,949 Total lease revenues $ 351,532 $ 273,730 $ 151,417 As of December 31, 2017 , future minimum rentals to be received related to these noncancelable commercial agreements were as follows (in thousands): 2018 $ 359,842 2019 359,842 2020 360,828 2021 359,842 2022 359,842 Thereafter 2,899,476 Total minimum rental payments $ 4,699,672 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Property, Plant and Equipment [Abstract] | |
Major classes of property and equipment | Major classes of property and equipment consisted of the following (in thousands): December 31, 2017 Non-Leased Assets Assets Leased to Valero Total Land $ 4,672 $ — $ 4,672 Pipelines and related assets 225,184 385,855 611,039 Terminals and related assets 134,362 1,162,718 1,297,080 Other 14,019 — 14,019 Construction in progress 42,423 — 42,423 Property and equipment, at cost 420,660 1,548,573 1,969,233 Accumulated depreciation (127,136 ) (425,681 ) (552,817 ) Property and equipment, net $ 293,524 $ 1,122,892 $ 1,416,416 December 31, 2016 Non-Leased Assets Assets Leased to Valero Total Land $ 4,672 $ — $ 4,672 Pipelines and related assets 224,656 47,366 272,022 Terminals and related assets 112,614 793,765 906,379 Other 9,538 — 9,538 Construction in progress 23,677 — 23,677 Property and equipment, at cost 375,157 841,131 1,216,288 Accumulated depreciation (115,538 ) (235,670 ) (351,208 ) Property and equipment, net $ 259,619 $ 605,461 $ 865,080 |
Debt and Notes Payable - Rela26
Debt and Notes Payable - Related Party (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Debt Disclosure [Abstract] | |
Debt | Debt, at stated values, consisted of the following (in thousands): Final Maturity December 31, 2017 2016 Revolving credit facility 2020 $ 410,000 $ 30,000 Senior Notes, 4.375% 2026 500,000 500,000 Net unamortized discount and debt issuance costs (4,717 ) (4,645 ) Total debt $ 905,283 $ 525,355 |
Interest and debt expense, net of capitalized interest | Interest and debt expense, net of capitalized interest was as follows (in thousands): Year Ended December 31, 2017 2016 2015 Interest and debt expense incurred $ 36,634 $ 14,997 $ 6,144 Less: Capitalized interest 619 82 31 Interest and debt expense, net of capitalized interest $ 36,015 $ 14,915 $ 6,113 |
Asset Retirement Obligations (T
Asset Retirement Obligations (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Asset Retirement Obligation Disclosure [Abstract] | |
Changes in asset retirement obligations | Changes in our asset retirement obligations were as follows (in thousands): December 31, 2017 2016 2015 Balance as of beginning of year $ 1,069 $ 1,021 $ 975 Accretion expense 30 48 46 Balance as of end of year $ 1,099 $ 1,069 $ 1,021 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Future minimum rentals for leases having initial or remaining noncancelable lease terms in excess of one year | As of December 31, 2017 , our future minimum rentals for leases having initial or remaining noncancelable lease terms in excess of one year were as follows (in thousands): Agreements With Related Party Others Total 2018 $ 13,241 $ 856 $ 14,097 2019 13,177 1,112 14,289 2020 13,147 1,111 14,258 2021 13,116 1,099 14,215 2022 13,115 1,099 14,214 Thereafter 276,967 24,639 301,606 Total minimum rental payments $ 342,763 $ 29,916 $ 372,679 |
Minimum rental expense for all operating leases | Minimum rental expenses for all operating leases are shown in the following table (in thousands). Contingent rental expense for all operating leases was immaterial. Year Ended December 31, 2017 2016 2015 Minimum rental expenses – related party $ 10,308 $ 8,946 $ 5,803 Minimum rental expenses – others 1,392 815 1,327 Total minimum rental expenses $ 11,700 $ 9,761 $ 7,130 |
Cash Distributions (Tables)
Cash Distributions (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Partners' Capital [Abstract] | |
Distributions made to unitholders | The following table summarizes information related to our quarterly cash distributions: Quarterly Period Ended Total Quarterly Distribution (Per Unit) Total Cash Distribution (In Thousands) Declaration Date Record Date Distribution Date December 31, 2017 $ 0.5075 $ 50,055 January 24, 2018 February 5, 2018 February 13, 2018 September 30, 2017 0.4800 46,242 October 19, 2017 November 1, 2017 November 9, 2017 June 30, 2017 0.4550 42,111 July 19, 2017 August 1, 2017 August 10, 2017 March 31, 2017 0.4275 38,043 April 20, 2017 May 2, 2017 May 11, 2017 December 31, 2016 0.4065 34,895 January 20, 2017 February 2, 2017 February 10, 2017 September 30, 2016 0.3850 32,175 October 24, 2016 November 3, 2016 November 10, 2016 June 30, 2016 0.3650 28,912 July 21, 2016 August 1, 2016 August 9, 2016 March 31, 2016 0.3400 25,608 April 21, 2016 May 2, 2016 May 10, 2016 December 31, 2015 0.3200 22,711 January 25, 2016 February 4, 2016 February 11, 2016 September 30, 2015 0.3075 20,164 October 15, 2015 November 2, 2015 November 10, 2015 June 30, 2015 0.2925 18,456 July 24, 2015 August 3, 2015 August 11, 2015 March 31, 2015 0.2775 17,266 April 21, 2015 May 1, 2015 May 12, 2015 December 31, 2014 0.2660 15,829 January 26, 2015 February 5, 2015 February 12, 2015 The following table reflects the allocation of total cash distributions to the general and limited partners and distribution equivalent right (DER) payments (see Notes 9 and 11 for a description of DERs) applicable to the period in which the distributions and DERs were earned (in thousands): Year Ended December 31, 2017 2016 2015 General partner’s distributions: General partner’s distributions $ 3,363 $ 2,294 $ 1,572 General partner’s incentive distribution rights (IDRs) 44,534 19,354 3,431 Total general partner’s distributions 47,897 21,648 5,003 Limited partners’ distributions: Common – public 42,029 32,362 22,016 Common – Valero 86,503 47,263 17,090 Subordinated – Valero — 20,297 34,476 Total limited partners’ distributions 128,532 99,922 73,582 DERs 22 20 12 Total cash distributions, including DERs $ 176,451 $ 121,590 $ 78,597 |
Net Income Per Limited Partne30
Net Income Per Limited Partner Unit (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Earnings Per Share [Abstract] | |
Computation of net income per unit | Net income per unit was computed as follows (in thousands, except per unit amounts): Year Ended December 31, 2017 General Limited Partner Common Restricted Total Allocation of net income to determine net income available to limited partners: Distributions, excluding general partner’s IDRs $ 3,363 $ 128,532 $ — $ 131,895 General partner’s IDRs 44,534 — — 44,534 DERs — — 22 22 Distributions and DERs declared 47,897 128,532 22 176,451 Undistributed earnings 1,216 60,756 10 61,982 Net income available to $ 49,113 $ 189,288 $ 32 $ 238,433 Net income per limited partner unit – basic and diluted: Weighted-average units outstanding 68,220 Net income per limited partner unit – basic and diluted $ 2.77 Year Ended December 31, 2016 Limited Partners General Partner Common Units Subordinated Units Restricted Units Total Allocation of net income to determine net income available to limited partners: Distributions, excluding general partner’s IDRs $ 2,294 $ 79,625 $ 20,297 $ — $ 102,216 General partner’s IDRs 19,354 — — — 19,354 DERs — — — 20 20 Distributions and DERs declared 21,648 79,625 20,297 20 121,590 Undistributed earnings 1,905 59,452 21,289 17 82,663 Net income available to limited partners – basic and diluted $ 23,553 $ 139,077 $ 41,586 $ 37 $ 204,253 Net income per limited partner unit – basic and diluted: Weighted-average units outstanding 48,817 17,463 Net income per limited partner unit – basic and diluted $ 2.85 $ 2.38 Year Ended December 31, 2015 Limited Partners General Partner Common Units Subordinated Units Restricted Units Total Allocation of net income to determine net income available to limited partners: Distributions, excluding general partner’s IDRs $ 1,572 $ 39,106 $ 34,476 $ — $ 75,154 General partner’s IDRs 3,431 — — — 3,431 DERs — — — 12 12 Distributions and DERs declared 5,003 39,106 34,476 12 78,597 Undistributed earnings 1,066 27,162 25,045 8 53,281 Net income available to limited partners – basic and diluted $ 6,069 $ 66,268 $ 59,521 $ 20 $ 131,878 Net income per limited partner unit – basic and diluted: Weighted-average units outstanding 31,222 28,790 Net income per limited partner unit – basic and diluted $ 2.12 $ 2.07 |
Partners' Capital (Tables)
Partners' Capital (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Partners' Capital Notes [Abstract] | |
Activity in the number of units | The following table summarizes activities of the common units issued under our ATM Program and general partner units issued to maintain the 2.0 percent general partner interest in the Partnership (in thousands, except unit amounts): Units Total Offering Net Year ended December 31, 2017: Common – public 742,897 $ 35,728 $ 594 $ 35,134 General partner 15,602 748 — 748 Year ended December 31, 2016: Common – public 223,083 9,724 107 9,617 General partner 4,552 198 — 198 Unit Activity Activity in the number of units was as follows: Common General Partner Public Valero Subordinated Total Balance as of December 31, 2014 17,255,208 11,539,989 28,789,989 1,175,102 58,760,288 Unit-based compensation 4,443 — — — 4,443 Units issued in connection with acquisitions (see Note 2) — 3,478,613 — 70,992 3,549,605 Unit issuance 4,250,000 — — — 4,250,000 General partner units issued to maintain 2% interest — — — 86,735 86,735 Balance as of December 31, 2015 21,509,651 15,018,602 28,789,989 1,332,829 66,651,071 Unit-based compensation 5,958 — — — 5,958 Units issued in connection with acquisitions (see Note 2) — 1,878,680 — 38,340 1,917,020 Conversion of subordinated units — 28,789,989 (28,789,989 ) — — Units issued under ATM Program 223,083 — — — 223,083 General partner units issued to maintain 2% interest — — — 4,552 4,552 Balance as of December 31, 2016 21,738,692 45,687,271 — 1,375,721 68,801,684 Unit-based compensation (see Note 11) 5,997 — — — 5,997 Units issued in connection with acquisitions (see Note 2) — 1,081,315 — 22,068 1,103,383 Units issued under ATM Program 742,897 — — — 742,897 General partner units issued to maintain 2% interest — — — 15,602 15,602 Balance as of December 31, 2017 22,487,586 46,768,586 — 1,413,391 70,669,563 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
Components of income tax expense | Components of income tax expense were as follows (in thousands): Year Ended December 31, 2017 2016 2015 Current U.S. state $ 942 $ 704 $ 479 Deferred U.S. state 393 408 (228 ) Income tax expense $ 1,335 $ 1,112 $ 251 |
Supplemental Cash Flow Inform33
Supplemental Cash Flow Information (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Supplemental Cash Flow Information [Abstract] | |
Supplemental cash flow disclosures | In order to determine net cash provided by operating activities, net income is adjusted by, among other things, changes in current assets and current liabilities as follows (in thousands): Year Ended December 31, 2017 2016 2015 Decrease (increase) in current assets: Receivables – related party $ (9,607 ) $ (10,786 ) $ (15,588 ) Receivables (781 ) — — Prepaid expenses and other 277 (365 ) 95 Increase (decrease) in current liabilities: Accounts payable 7,411 586 (631 ) Accounts payable – related party (3,404 ) (667 ) 5,999 Accrued liabilities 137 34 (87 ) Accrued liabilities – related party 10 40 21 Accrued interest payable 1,278 1,054 226 Accrued interest payable – related party 864 (429 ) 476 Taxes other than income taxes payable 2,684 1,181 511 Deferred revenue – related party (2,599 ) 3,396 5 Changes in current assets and current liabilities $ (3,730 ) $ (5,956 ) $ (8,973 ) Cash flows related to interest and income taxes paid were as follows (in thousands): Year Ended December 31, 2017 2016 2015 Interest paid $ 33,355 $ 13,873 $ 5,367 Income taxes paid 719 505 441 The following table presents our investing and financing cash outflows in connection with the acquisitions from Valero as described in Note 2 (in thousands). Of the cash consideration paid, the portion attributed to Valero’s historical carrying value of each acquisition was reflected as an investing cash outflow and the excess purchase price paid over the carrying value of each acquisition was reflected as a financing cash outflow. Investing Financing Total Year ended December 31, 2017: Parkway Pipeline $ 200,249 $ — $ 200,249 Port Arthur terminal 207,595 54,618 262,213 $ 407,844 $ 54,618 $ 462,462 Year ended December 31, 2016: McKee Terminal Services Business $ 51,361 $ 152,639 $ 204,000 Meraux and Three Rivers Terminal Services Business 52,246 223,754 276,000 $ 103,607 $ 376,393 $ 480,000 Year ended December 31, 2015: Houston and St. Charles Terminal Services Business $ 296,109 $ 275,111 $ 571,220 Corpus Christi Terminal Services Business 94,035 300,965 395,000 $ 390,144 $ 576,076 $ 966,220 |
Supplemental cash flow disclosures, noncash activities | Noncash investing and financing activities that affected recognized assets or liabilities were as follows (in thousands): Year Ended December 31, 2017 2016 2015 Transfer (from) to Valero for: Deferred income taxes $ — $ (190 ) $ (282 ) Change in accrued capital expenditures — 46 7,232 Noncash contributions from Valero: Excess of carrying value over purchase price paid for acquisition of Parkway Pipeline (see Note 2) 51,702 — — Capital projects 41,305 35,732 27,748 Increase in accounts payable related to capital expenditures 570 904 5,496 Units issued to Valero in connection with acquisitions (see Note 2) 46,000 85,000 170,000 Offering costs included in accounts payable — — (102 ) Units issued under ATM Program included in receivables — 1,682 — |
Fair Value of Financial Instr34
Fair Value of Financial Instruments Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Fair Value Disclosures [Abstract] | |
Carrying amounts and estimated fair value of financial instruments | Financial instruments that we recognize in our balance sheets at their carrying amounts are shown in the following table along with their associated fair values (in thousands): December 31, 2017 December 31, 2016 Carrying Amount Fair Value Carrying Amount Fair Value Financial assets: Cash and cash equivalents $ 42,052 $ 42,052 $ 71,491 $ 71,491 Financial liabilities: Debt: Revolver 410,000 410,000 30,000 30,000 Senior Notes 495,283 523,800 495,355 506,670 Notes payable – related party 370,000 370,000 370,000 370,000 |
Quarterly Financial Data (Una35
Quarterly Financial Data (Unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Quarterly Financial Information Disclosure [Abstract] | |
Schedule of quarterly financial data | The following tables summarize quarterly financial data for the years ended December 31, 2017 and 2016 (in thousands, except per unit amounts): 2017 Quarter Ended March 31 June 30 September 30 December 31 Operating revenues – related party $ 105,816 $ 110,545 $ 109,340 $ 126,304 Gross profit (a) 70,496 70,985 70,749 78,926 Operating income 66,666 67,122 66,347 74,895 Net income 58,137 58,443 57,589 64,264 Net income attributable to partners 58,137 58,443 57,589 64,264 Limited partners’ interest in net income 48,670 47,024 44,552 49,074 Net income per limited partner unit – basic and diluted: Common units 0.72 0.69 0.65 0.71 2016 Quarter Ended March 31 June 30 September 30 December 31 Operating revenues – related party $ 78,767 $ 87,664 $ 92,040 $ 104,148 Gross profit (a) 42,969 51,757 56,632 69,181 Operating income 38,604 48,042 52,538 65,390 Net income 35,780 44,545 48,707 59,799 Net income attributable to partners 43,298 49,447 51,709 59,799 Limited partners’ interest in net income 39,794 44,234 45,075 51,597 Net income per limited partner unit – basic and diluted: Common units 0.61 0.67 0.77 0.77 Subordinated units 0.61 0.67 0.29 — (a) Gross profit is calculated as operating revenues – related party less cost of revenues (excluding depreciation expense) and depreciation expense. |
Description of Business, Basi36
Description of Business, Basis of Presentation, and Significant Accounting Policies (Details) | 12 Months Ended |
Dec. 31, 2017refinery | |
Business and Basis of Presentation (Textual) | |
Limited partnership formation date | Jul. 24, 2013 |
Majority Shareholder [Member] | |
Business and Basis of Presentation (Textual) | |
Number of Valero owned refineries | 10 |
Acquisitions (Details)
Acquisitions (Details) bbl / d in Thousands, bbl in Thousands, $ in Thousands | Nov. 01, 2017USD ($)bbl / dshares | Jan. 18, 2017USD ($)bbl / dpropertybbl | Sep. 01, 2016USD ($)subsidiaryshares | Apr. 01, 2016USD ($)subsidiaryshares | Oct. 01, 2015USD ($)subsidiaryshares | Mar. 01, 2015USD ($)subsidiaryshares | Dec. 31, 2017USD ($)shares | Dec. 31, 2016USD ($)shares | Dec. 31, 2015USD ($)shares |
Business Acquisitions (Textual) | |||||||||
Units issued in connection with acquisitions (shares) | shares | 1,103,383 | 1,917,020 | 3,549,605 | ||||||
Proceeds from debt borrowings | $ 380,000 | $ 349,000 | $ 200,000 | ||||||
Proceeds from notes payable – related party | $ 0 | $ 0 | $ 555,000 | ||||||
Limited Partner [Member] | Common Unitholder Valero [Member] | |||||||||
Business Acquisitions (Textual) | |||||||||
Units issued in connection with acquisitions (shares) | shares | 1,081,315 | 1,878,680 | 3,478,613 | ||||||
General Partner [Member] | |||||||||
Business Acquisitions (Textual) | |||||||||
Units issued in connection with acquisitions (shares) | shares | 22,068 | 38,340 | 70,992 | ||||||
Majority Shareholder [Member] | |||||||||
Business Acquisitions (Textual) | |||||||||
Business acquisition, cash distribution | $ 462,462 | $ 480,000 | $ 966,220 | ||||||
Majority Shareholder [Member] | McKee Terminal Services Business [Member] | |||||||||
Business Acquisitions (Textual) | |||||||||
Aggregate value of units issued | $ 36,000 | ||||||||
Business acquisition, effective date | Apr. 1, 2016 | ||||||||
Business acquisition, total consideration for acquired businesses | $ 240,000 | ||||||||
Business acquisition, cash distribution | 204,000 | 204,000 | |||||||
Business acquisition, payments to acquire businesses using cash on hand | $ 65,000 | ||||||||
Number of subsidiaries acquired from Valero | subsidiary | 1 | ||||||||
Majority Shareholder [Member] | McKee Terminal Services Business [Member] | Limited Partner [Member] | Common Unitholder Valero [Member] | |||||||||
Business Acquisitions (Textual) | |||||||||
Units issued in connection with acquisitions (shares) | shares | 728,775 | ||||||||
Majority Shareholder [Member] | McKee Terminal Services Business [Member] | General Partner [Member] | |||||||||
Business Acquisitions (Textual) | |||||||||
Units issued in connection with acquisitions (shares) | shares | 14,873 | ||||||||
Majority Shareholder [Member] | Meraux and Three Rivers Terminal Services Business [Member] | |||||||||
Business Acquisitions (Textual) | |||||||||
Aggregate value of units issued | $ 49,000 | ||||||||
Business acquisition, effective date | Sep. 1, 2016 | ||||||||
Business acquisition, total consideration for acquired businesses | $ 325,000 | ||||||||
Business acquisition, cash distribution | 276,000 | $ 276,000 | |||||||
Business acquisition, payments to acquire businesses using cash on hand | $ 66,000 | ||||||||
Number of subsidiaries acquired from Valero | subsidiary | 2 | ||||||||
Majority Shareholder [Member] | Meraux and Three Rivers Terminal Services Business [Member] | Limited Partner [Member] | Common Unitholder Valero [Member] | |||||||||
Business Acquisitions (Textual) | |||||||||
Units issued in connection with acquisitions (shares) | shares | 1,149,905 | ||||||||
Majority Shareholder [Member] | Meraux and Three Rivers Terminal Services Business [Member] | General Partner [Member] | |||||||||
Business Acquisitions (Textual) | |||||||||
Units issued in connection with acquisitions (shares) | shares | 23,467 | ||||||||
Majority Shareholder [Member] | Houston and St. Charles Terminal Services Business [Member] | |||||||||
Business Acquisitions (Textual) | |||||||||
Aggregate value of units issued | $ 100,000 | ||||||||
Business acquisition, effective date | Mar. 1, 2015 | ||||||||
Business acquisition, total consideration for acquired businesses | $ 671,200 | ||||||||
Business acquisition, cash distribution | 571,200 | 571,220 | |||||||
Business acquisition, payments to acquire businesses using cash on hand | $ 211,200 | ||||||||
Number of subsidiaries acquired from Valero | subsidiary | 2 | ||||||||
Proceeds from notes payable – related party | $ 160,000 | ||||||||
Majority Shareholder [Member] | Houston and St. Charles Terminal Services Business [Member] | Limited Partner [Member] | Common Unitholder Valero [Member] | |||||||||
Business Acquisitions (Textual) | |||||||||
Units issued in connection with acquisitions (shares) | shares | 1,908,100 | ||||||||
Majority Shareholder [Member] | Houston and St. Charles Terminal Services Business [Member] | General Partner [Member] | |||||||||
Business Acquisitions (Textual) | |||||||||
Units issued in connection with acquisitions (shares) | shares | 38,941 | ||||||||
Majority Shareholder [Member] | Corpus Christi Terminal Services Business [Member] | |||||||||
Business Acquisitions (Textual) | |||||||||
Aggregate value of units issued | $ 70,000 | ||||||||
Business acquisition, effective date | Oct. 1, 2015 | ||||||||
Business acquisition, total consideration for acquired businesses | $ 465,000 | ||||||||
Business acquisition, cash distribution | $ 395,000 | $ 395,000 | |||||||
Number of subsidiaries acquired from Valero | subsidiary | 2 | ||||||||
Proceeds from notes payable – related party | $ 395,000 | ||||||||
Majority Shareholder [Member] | Corpus Christi Terminal Services Business [Member] | Limited Partner [Member] | Common Unitholder Valero [Member] | |||||||||
Business Acquisitions (Textual) | |||||||||
Units issued in connection with acquisitions (shares) | shares | 1,570,513 | ||||||||
Majority Shareholder [Member] | Corpus Christi Terminal Services Business [Member] | General Partner [Member] | |||||||||
Business Acquisitions (Textual) | |||||||||
Units issued in connection with acquisitions (shares) | shares | 32,051 | ||||||||
Red River Crude System [Member] | Pipelines and related assets [Member] | |||||||||
Business Acquisitions (Textual) | |||||||||
Asset acquisition, effective date | Jan. 18, 2017 | ||||||||
Undivided ownership interest in assets (percent) | 40.00% | ||||||||
Number of properties acquired | property | 2 | ||||||||
Storage tank capacity (in shell barrels) | bbl | 150 | ||||||||
Asset acquisition, cash distribution | $ 71,800 | ||||||||
Throughput capacity of assets acquired (in barrels per day) | bbl / d | 150 | ||||||||
Parkway Pipeline [Member] | Majority Shareholder [Member] | |||||||||
Business Acquisitions (Textual) | |||||||||
Asset acquisition, cash distribution | $ 82,000 | ||||||||
Business acquisition, cash distribution | 200,249 | ||||||||
Parkway Pipeline [Member] | Pipelines and related assets [Member] | Majority Shareholder [Member] | |||||||||
Business Acquisitions (Textual) | |||||||||
Asset acquisition, effective date | Nov. 1, 2017 | ||||||||
Throughput capacity of assets acquired (in barrels per day) | bbl / d | 110 | ||||||||
Asset acquisition, total consideration for assets acquired | $ 200,000 | ||||||||
Port Arthur Terminal [Member] | Majority Shareholder [Member] | |||||||||
Business Acquisitions (Textual) | |||||||||
Asset acquisition, cash distribution | 262,000 | ||||||||
Aggregate value of units issued | $ 46,000 | ||||||||
Business acquisition, cash distribution | 262,213 | ||||||||
Port Arthur Terminal [Member] | Majority Shareholder [Member] | Limited Partner [Member] | Common Unitholder Valero [Member] | |||||||||
Business Acquisitions (Textual) | |||||||||
Units issued in connection with acquisitions (shares) | shares | 1,081,315 | ||||||||
Port Arthur Terminal [Member] | Majority Shareholder [Member] | General Partner [Member] | |||||||||
Business Acquisitions (Textual) | |||||||||
Units issued in connection with acquisitions (shares) | shares | 22,068 | ||||||||
Port Arthur Terminal [Member] | Pipelines and related assets [Member] | Majority Shareholder [Member] | |||||||||
Business Acquisitions (Textual) | |||||||||
Asset acquisition, effective date | Nov. 1, 2017 | ||||||||
Asset acquisition, total consideration for assets acquired | $ 308,000 | ||||||||
Joint Ownership Agreement (JOA) and Operating and Administrative Services Agreement with Plains [Member] | Red River Crude System [Member] | Pipelines and related assets [Member] | |||||||||
Business Acquisitions (Textual) | |||||||||
Duration of agreement | 5 years | ||||||||
Duration of renewal option | 5 years | ||||||||
Plains All American Pipeline L.P.’s (Plains) [Member] | Joint Ownership Agreement (JOA) and Operating and Administrative Services Agreement with Plains [Member] | Red River Crude System [Member] | Pipelines and related assets [Member] | |||||||||
Business Acquisitions (Textual) | |||||||||
Undivided ownership interest in assets (percent) | 60.00% | ||||||||
Revolving Credit Facility [Member] | McKee Terminal Services Business [Member] | |||||||||
Business Acquisitions (Textual) | |||||||||
Proceeds from debt borrowings | $ 139,000 | ||||||||
Revolving Credit Facility [Member] | Meraux and Three Rivers Terminal Services Business [Member] | |||||||||
Business Acquisitions (Textual) | |||||||||
Proceeds from debt borrowings | $ 210,000 | ||||||||
Revolving Credit Facility [Member] | Houston and St. Charles Terminal Services Business [Member] | |||||||||
Business Acquisitions (Textual) | |||||||||
Proceeds from debt borrowings | $ 200,000 | ||||||||
Revolving Credit Facility [Member] | Parkway Pipeline [Member] | |||||||||
Business Acquisitions (Textual) | |||||||||
Proceeds from debt borrowings | 118,000 | ||||||||
Revolving Credit Facility [Member] | Port Arthur Terminal [Member] | |||||||||
Business Acquisitions (Textual) | |||||||||
Proceeds from debt borrowings | $ 262,000 |
Related-Party Agreements and 38
Related-Party Agreements and Transactions, Agreements (Details) bbl in Thousands, $ in Millions | Mar. 31, 2017bbl | Dec. 31, 2017USD ($)renewal |
Commercial Agreements [Member] | ||
Related-Party Agreements and Transactions (Textual) | ||
Storage tank capacity (in shell barrels) | bbl | 180 | |
Agreement maturity date | Jun. 30, 2033 | |
Majority Shareholder [Member] | Commercial Agreements [Member] | ||
Related-Party Agreements and Transactions (Textual) | ||
Duration of agreement | 10 years | |
Number of renewal options | 1 | |
Duration of renewal option | 5 years | |
Majority Shareholder [Member] | Amended and Restated Omnibus Agreement [Member] | ||
Related-Party Agreements and Transactions (Textual) | ||
Annual administrative fee | $ | $ 13.2 | |
Majority Shareholder [Member] | Services and Secondment Agreement [Member] | ||
Related-Party Agreements and Transactions (Textual) | ||
Duration of agreement | 10 years | |
Duration of renewal option | 1 year | |
Prior written notice | 30 days | |
Majority Shareholder [Member] | Lease Agreements [Member] | ||
Related-Party Agreements and Transactions (Textual) | ||
Duration of agreement | 10 years | |
Number of renewal options | 4 | |
Duration of renewal period, lease agreement | 5 years | |
Majority Shareholder [Member] | Ground Lease Agreement [Member] | ||
Related-Party Agreements and Transactions (Textual) | ||
Duration of agreement | 20 years | |
Number of renewal options | 0 |
Related-Party Agreements and 39
Related-Party Agreements and Transactions Related Party Agreements and Transactions, Operating Revenues and Operating Leases - Lessor (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Related Party Transaction [Line Items] | |||||||||||
Operating revenues – related party | $ 126,304 | $ 109,340 | $ 110,545 | $ 105,816 | $ 104,148 | $ 92,040 | $ 87,664 | $ 78,767 | $ 452,005 | $ 362,619 | $ 243,624 |
Majority Shareholder [Member] | |||||||||||
Related Party Transaction [Line Items] | |||||||||||
Operating revenues – related party | 452,005 | 362,619 | 243,624 | ||||||||
Operating Leases - Lessor | |||||||||||
Minimum rental revenues | 292,034 | 232,211 | 128,468 | ||||||||
Contingent rental revenues | 59,498 | 41,519 | 22,949 | ||||||||
Total lease revenues | 351,532 | 273,730 | 151,417 | ||||||||
Future Minimum Rentals to be Received on Noncancelable Lease Agreements | |||||||||||
2,018 | 359,842 | 359,842 | |||||||||
2,019 | 359,842 | 359,842 | |||||||||
2,020 | 360,828 | 360,828 | |||||||||
2,021 | 359,842 | 359,842 | |||||||||
2,022 | 359,842 | 359,842 | |||||||||
Thereafter | 2,899,476 | 2,899,476 | |||||||||
Total minimum rental payments | $ 4,699,672 | 4,699,672 | |||||||||
Pipeline Transportation Services Revenues [Member] | Majority Shareholder [Member] | |||||||||||
Related Party Transaction [Line Items] | |||||||||||
Operating revenues – related party | 100,631 | 78,451 | 81,435 | ||||||||
Terminaling Services Revenues [Member] | Majority Shareholder [Member] | |||||||||||
Related Party Transaction [Line Items] | |||||||||||
Operating revenues – related party | 347,996 | 283,628 | 161,649 | ||||||||
Storage and Other Services Revenue [Member] | Majority Shareholder [Member] | |||||||||||
Related Party Transaction [Line Items] | |||||||||||
Operating revenues – related party | $ 3,378 | $ 540 | $ 540 |
Related-Party Agreements and 40
Related-Party Agreements and Transactions Related-Party Agreements and Transactions, Insurance Recoveries (Details) - Majority Shareholder [Member] $ in Thousands | 12 Months Ended |
Dec. 31, 2017USD ($) | |
Related Party Transaction [Line Items] | |
Insurance recoveries | $ 2,700 |
Property damage receivable | $ 828 |
Related-Party Agreements and 41
Related-Party Agreements and Transactions Related-Party Angements and Transactions, Net Investment (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Related Party Transaction [Line Items] | |||
Net transfers from Valero per statements of cash flows | $ 0 | $ 14,886 | $ 77,284 |
Majority Shareholder [Member] | |||
Related Party Transaction [Line Items] | |||
Net transfers from Valero per statements of partners’ capital | 0 | 15,030 | 70,334 |
Less: Noncash transfers from Valero | 0 | 144 | |
Less: Noncash transfers to Valero | (6,950) | ||
Net transfers from Valero per statements of cash flows | $ 0 | $ 14,886 | $ 77,284 |
Property and Equipment (Details
Property and Equipment (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Non-Leased Assets | ||
Property and equipment excluding assets subject to operating lease, at cost | $ 420,660 | $ 375,157 |
Accumulated depreciation, property and equipment, excluding assets subject to operating lease | (127,136) | (115,538) |
Property and equipment excluding assets subject to operating lease | 293,524 | 259,619 |
Assets Leased to Valero | ||
Assets leased to Valero, at cost | 1,548,573 | 841,131 |
Accumulated depreciation, assets leased to Valero | (425,681) | (235,670) |
Assets leased to Valero, net | 1,122,892 | 605,461 |
Property and Equipment, Gross | ||
Property and equipment, at cost | 1,969,233 | 1,216,288 |
Accumulated depreciation | (552,817) | (351,208) |
Property and equipment, net | 1,416,416 | 865,080 |
Land [Member] | ||
Non-Leased Assets | ||
Property and equipment excluding assets subject to operating lease, at cost | 4,672 | 4,672 |
Assets Leased to Valero | ||
Assets leased to Valero, at cost | 0 | 0 |
Property and Equipment, Gross | ||
Property and equipment, at cost | 4,672 | 4,672 |
Pipelines and related assets [Member] | ||
Non-Leased Assets | ||
Property and equipment excluding assets subject to operating lease, at cost | 225,184 | 224,656 |
Assets Leased to Valero | ||
Assets leased to Valero, at cost | 385,855 | 47,366 |
Property and Equipment, Gross | ||
Property and equipment, at cost | 611,039 | 272,022 |
Terminals and related assets [Member] | ||
Non-Leased Assets | ||
Property and equipment excluding assets subject to operating lease, at cost | 134,362 | 112,614 |
Assets Leased to Valero | ||
Assets leased to Valero, at cost | 1,162,718 | 793,765 |
Property and Equipment, Gross | ||
Property and equipment, at cost | 1,297,080 | 906,379 |
Other [Member] | ||
Non-Leased Assets | ||
Property and equipment excluding assets subject to operating lease, at cost | 14,019 | 9,538 |
Assets Leased to Valero | ||
Assets leased to Valero, at cost | 0 | 0 |
Property and Equipment, Gross | ||
Property and equipment, at cost | 14,019 | 9,538 |
Construction-in-progress [Member] | ||
Non-Leased Assets | ||
Property and equipment excluding assets subject to operating lease, at cost | 42,423 | 23,677 |
Assets Leased to Valero | ||
Assets leased to Valero, at cost | 0 | 0 |
Property and Equipment, Gross | ||
Property and equipment, at cost | $ 42,423 | $ 23,677 |
Debt and Notes Payable - Rela43
Debt and Notes Payable - Related Party, Schedule of Debt (Details) - USD ($) | Dec. 31, 2017 | Dec. 31, 2016 |
Debt Instruments [Abstract] | ||
Net unamortized discount and debt issuance costs | $ (4,717,000) | $ (4,645,000) |
Total debt | 905,283,000 | 525,355,000 |
Revolving Credit Facility [Member] | VLP Revolver [Member] | ||
Debt Instruments [Abstract] | ||
Long-term debt at stated values | 410,000,000 | 30,000,000 |
Senior Notes [Member] | ||
Debt Instruments [Abstract] | ||
Total debt | 495,283,000 | 495,355,000 |
Senior Notes [Member] | Senior Notes Due in 2026 [Member] | ||
Debt Instruments [Abstract] | ||
Long-term debt at stated values | $ 500,000,000 | $ 500,000,000 |
Debt and Notes Payable - Rela44
Debt and Notes Payable - Related Party, Revolving Credit Facility and Senior Notes (Details) | Sep. 01, 2016USD ($) | Apr. 01, 2016USD ($) | Mar. 01, 2015USD ($) | Dec. 31, 2017USD ($)quarter | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) |
Credit Facility [Abstract] | ||||||
Proceeds from long-term lines of credit | $ 380,000,000 | $ 349,000,000 | $ 200,000,000 | |||
Senior Notes [Abstract] | ||||||
Payments of debt issuance costs | 492,000 | $ 4,462,000 | 2,322,000 | |||
Revolving Credit Facility [Member] | McKee Terminal Services Business [Member] | ||||||
Credit Facility [Abstract] | ||||||
Proceeds from long-term lines of credit | $ 139,000,000 | |||||
Revolving Credit Facility [Member] | Meraux and Three Rivers Terminal Services Business [Member] | ||||||
Credit Facility [Abstract] | ||||||
Proceeds from long-term lines of credit | $ 210,000,000 | |||||
Revolving Credit Facility [Member] | Houston and St. Charles Terminal Services Business [Member] | ||||||
Credit Facility [Abstract] | ||||||
Proceeds from long-term lines of credit | $ 200,000,000 | |||||
Revolving Credit Facility [Member] | Parkway Pipeline [Member] | ||||||
Credit Facility [Abstract] | ||||||
Proceeds from long-term lines of credit | 118,000,000 | |||||
Revolving Credit Facility [Member] | Port Arthur Terminal [Member] | ||||||
Credit Facility [Abstract] | ||||||
Proceeds from long-term lines of credit | 262,000,000 | |||||
Revolving Credit Facility [Member] | Revolving Credit Facility [Member] | ||||||
Credit Facility [Abstract] | ||||||
Line of credit facility, maximum borrowing capacity | $ 750,000,000 | |||||
Line of credit facility, maturity date | Nov. 20, 2020 | |||||
Line of credit facility, higher borrowing capacity option | $ 1,000,000,000 | |||||
Line of credit facility, interest rate at period end | 2.875% | 2.3125% | ||||
Number of prior quarterly reporting periods | quarter | 4 | |||||
Repayments of long-term lines of credit | $ 494,000,000 | 25,000,000 | ||||
Senior Notes [Abstract] | ||||||
Payments of debt issuance costs | $ 0 | 0 | ||||
Revolving Credit Facility [Member] | Revolving Credit Facility [Member] | McKee Terminal Services Business [Member] | ||||||
Credit Facility [Abstract] | ||||||
Proceeds from long-term lines of credit | 139,000,000 | |||||
Revolving Credit Facility [Member] | Revolving Credit Facility [Member] | Meraux and Three Rivers Terminal Services Business [Member] | ||||||
Credit Facility [Abstract] | ||||||
Proceeds from long-term lines of credit | 210,000,000 | |||||
Revolving Credit Facility [Member] | Revolving Credit Facility [Member] | Houston and St. Charles Terminal Services Business [Member] | ||||||
Credit Facility [Abstract] | ||||||
Proceeds from long-term lines of credit | $ 200,000,000 | |||||
Revolving Credit Facility [Member] | Revolving Credit Facility [Member] | Maximum [Member] | ||||||
Credit Facility [Abstract] | ||||||
Debt to EBITDA ratio as per terms of revolver | 5 | |||||
Debt to EBITDA ratio following certain acquisitions as per terms of revolver | 5.5 | |||||
Revolving Credit Facility [Member] | Letters of Credit [Member] | ||||||
Credit Facility [Abstract] | ||||||
Line of credit facility, maximum borrowing capacity | $ 100,000,000 | |||||
Long-term line of credit, noncurrent | 0 | 0 | ||||
Senior Notes [Member] | Senior Notes Due in 2026 [Member] | ||||||
Senior Notes [Abstract] | ||||||
Long-term debt at stated values | $ 500,000,000 | $ 500,000,000 | ||||
Interest rate of notes (percent) | 4.375% | 4.375% | ||||
Long-term debt, maturity date | Dec. 15, 2026 | |||||
Proceeds from issuance of senior long-term debt | $ 499,800,000 | |||||
Payments of debt issuance costs | $ 4,500,000 |
Debt and Notes Payable - Rela45
Debt and Notes Payable - Related Party, Notes Payable - Related Party (Details) $ in Thousands | Oct. 01, 2015USD ($) | Mar. 01, 2015USD ($) | Dec. 31, 2017USD ($)quarter | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($)loan_agreement |
Debt Instrument [Line Items] | |||||
Notes payable to related party, borrowings | $ 0 | $ 0 | $ 555,000 | ||
Notes payable – related party | 370,000 | 370,000 | |||
Notes payable to related party, repayments | 0 | 0 | 185,000 | ||
Majority Shareholder [Member] | Houston and St. Charles Terminal Services Business [Member] | |||||
Debt Instrument [Line Items] | |||||
Notes payable to related party, borrowings | $ 160,000 | ||||
Majority Shareholder [Member] | Corpus Christi Terminal Services Business [Member] | |||||
Debt Instrument [Line Items] | |||||
Notes payable to related party, borrowings | $ 395,000 | ||||
Subordinated Debt [Member] | Majority Shareholder [Member] | |||||
Debt Instrument [Line Items] | |||||
Notes payable – related party | $ 370,000 | $ 370,000 | |||
Notes payable to related party, repayments | 185,000 | ||||
Number of prior quarterly reporting periods | quarter | 4 | ||||
Subordinated Debt [Member] | Majority Shareholder [Member] | Maximum [Member] | |||||
Debt Instrument [Line Items] | |||||
Debt to EBITDA ratio as per terms of revolver | 5 | ||||
Debt to EBITDA ratio following certain acquisitions as per terms of revolver | 5.5 | ||||
Subordinated Debt [Member] | Majority Shareholder [Member] | Houston and St. Charles Terminal Services Business [Member] | |||||
Debt Instrument [Line Items] | |||||
Notes payable to related party, borrowings | $ 160,000 | ||||
Notes to related party, maturity date | Mar. 1, 2020 | ||||
Subordinated Debt [Member] | Majority Shareholder [Member] | Corpus Christi Terminal Services Business [Member] | |||||
Debt Instrument [Line Items] | |||||
Notes payable to related party, borrowings | $ 395,000 | ||||
Notes to related party, maturity date | Oct. 1, 2020 | ||||
Subordinated Debt [Member] | Subordinated Credit Agreements With Valero [Member] | Majority Shareholder [Member] | |||||
Debt Instrument [Line Items] | |||||
Number of loan agreements | loan_agreement | 2 | ||||
Notes payable to related party, rate at period end (percent) | 2.86069% | 2.27% |
Debt and Notes Payable - Rela46
Debt and Notes Payable - Related Party, Other Disclosures (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | ||
Interest Costs Incurred [Abstract] | ||||
Interest and debt expense incurred | $ 36,634 | $ 14,997 | $ 6,144 | |
Less: Capitalized interest | 619 | 82 | 31 | |
Interest and debt expense, net of capitalized interest | [1] | 36,015 | $ 14,915 | $ 6,113 |
Long-term Debt, Fiscal Year Maturity [Abstract] | ||||
Due in 2020 | 780,000 | |||
Due in 2026 | $ 500,000 | |||
[1] | Includes interest and debt expense – related party of $9,658 thousand, $6,608 thousand, and $3,190 thousand for the years ended December 31, 2017, 2016, and 2015, respectively. |
Asset Retirement Obligations (D
Asset Retirement Obligations (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Changes in Asset Retirement Obligations | |||
Balance as of beginning of year | $ 1,069,000 | $ 1,021,000 | $ 975,000 |
Accretion expense | 30,000 | 48,000 | 46,000 |
Balance as of end of year | 1,099,000 | 1,069,000 | $ 1,021,000 |
Current liability for asset retirement obligations | 0 | 0 | |
Assets that are legally restricted for purposes | $ 0 | $ 0 |
Commitments and Contingencies48
Commitments and Contingencies (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Future Minimum Rentals on Operating Leases | |||
2,018 | $ 14,097 | ||
2,019 | 14,289 | ||
2,020 | 14,258 | ||
2,021 | 14,215 | ||
2,022 | 14,214 | ||
Thereafter | 301,606 | ||
Total minimum rental payments | 372,679 | ||
Operating Leases, Rent Expense, Net [Abstract] | |||
Minimum rental expense for operating leases | 11,700 | $ 9,761 | $ 7,130 |
Related Party [Member] | |||
Future Minimum Rentals on Operating Leases | |||
2,018 | 13,241 | ||
2,019 | 13,177 | ||
2,020 | 13,147 | ||
2,021 | 13,116 | ||
2,022 | 13,115 | ||
Thereafter | 276,967 | ||
Total minimum rental payments | 342,763 | ||
Operating Leases, Rent Expense, Net [Abstract] | |||
Minimum rental expense for operating leases | 10,308 | 8,946 | 5,803 |
Others [Member] | |||
Future Minimum Rentals on Operating Leases | |||
2,018 | 856 | ||
2,019 | 1,112 | ||
2,020 | 1,111 | ||
2,021 | 1,099 | ||
2,022 | 1,099 | ||
Thereafter | 24,639 | ||
Total minimum rental payments | 29,916 | ||
Operating Leases, Rent Expense, Net [Abstract] | |||
Minimum rental expense for operating leases | $ 1,392 | $ 815 | $ 1,327 |
Cash Distributions (Details)
Cash Distributions (Details) - USD ($) $ / shares in Units, $ in Thousands | Jan. 24, 2018 | Nov. 09, 2017 | Aug. 10, 2017 | May 11, 2017 | Feb. 10, 2017 | Nov. 10, 2016 | Aug. 09, 2016 | May 10, 2016 | Feb. 11, 2016 | Nov. 10, 2015 | Aug. 11, 2015 | May 12, 2015 | Feb. 12, 2015 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Quarterly Cash Distributions | ||||||||||||||||
Total quarterly distribution (in dollars per unit) | $ 0.48 | $ 0.4550 | $ 0.4275 | $ 0.4065 | $ 0.3850 | $ 0.3650 | $ 0.3400 | $ 0.3200 | $ 0.3075 | $ 0.2925 | $ 0.2775 | $ 0.2660 | $ 1.87 | $ 1.4965 | $ 1.1975 | |
Distributions | $ 46,242 | $ 42,111 | $ 38,043 | $ 34,895 | $ 32,175 | $ 28,912 | $ 25,608 | $ 22,711 | $ 20,164 | $ 18,456 | $ 17,266 | $ 15,829 | $ 176,451 | $ 121,590 | $ 78,597 | |
General Partner’s Distribution, Including Incentive Distribution Rights [Member] | ||||||||||||||||
Quarterly Cash Distributions | ||||||||||||||||
Distributions | 47,897 | 21,648 | 5,003 | |||||||||||||
General Partner Valero [Member] | ||||||||||||||||
Quarterly Cash Distributions | ||||||||||||||||
Distributions | 3,363 | 2,294 | 1,572 | |||||||||||||
General Partner IDRs [Member] | ||||||||||||||||
Quarterly Cash Distributions | ||||||||||||||||
Distributions | 44,534 | 19,354 | 3,431 | |||||||||||||
Limited Partner, Common and Subordinated Units [Member] | ||||||||||||||||
Quarterly Cash Distributions | ||||||||||||||||
Distributions | 128,532 | 99,922 | 73,582 | |||||||||||||
Common Unitholders Public [Member] | ||||||||||||||||
Quarterly Cash Distributions | ||||||||||||||||
Distributions | 42,029 | 32,362 | 22,016 | |||||||||||||
Common Unitholder Valero [Member] | ||||||||||||||||
Quarterly Cash Distributions | ||||||||||||||||
Distributions | 86,503 | 47,263 | 17,090 | |||||||||||||
Subordinated Unitholder Valero [Member] | ||||||||||||||||
Quarterly Cash Distributions | ||||||||||||||||
Distributions | 0 | 20,297 | 34,476 | |||||||||||||
Distribution Equivalent Rights [Member] | ||||||||||||||||
Quarterly Cash Distributions | ||||||||||||||||
Distributions | $ 22 | $ 20 | $ 12 | |||||||||||||
Subsequent Event [Member] | ||||||||||||||||
Quarterly Cash Distributions | ||||||||||||||||
Total quarterly distribution (in dollars per unit) | $ 0.5075 | |||||||||||||||
Distributions | $ 50,055 |
Net Income Per Limited Partne50
Net Income Per Limited Partner Unit (Details) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017USD ($)$ / sharesshares | Dec. 31, 2016USD ($)$ / sharesshares | Dec. 31, 2015USD ($)$ / sharesshares | |
Net Income Per Limited Partner Unit [Line Items] | |||
Conversion ratio | 1,000 | ||
Allocation of net income to determine net income available to limited partners: | |||
Distributions, excluding general partner’s IDRs | $ 131,895 | $ 102,216 | $ 75,154 |
General partner’s IDRs | 44,534 | 19,354 | 3,431 |
DERs | 22 | 20 | 12 |
Distributions and DERs declared | 176,451 | 121,590 | 78,597 |
Undistributed earnings, basic and diluted | 61,982 | 82,663 | 53,281 |
Net income available to limited partners – basic and diluted | $ 238,433 | $ 204,253 | $ 131,878 |
Net income per limited partner unit – basic and diluted: | |||
Weighted-average units outstanding (shares) | shares | 68,220 | 48,817 | 31,222 |
Net income per limited partner unit – basic and diluted, common units (in dollars per share) | $ / shares | $ 2.77 | $ 2.85 | $ 2.12 |
General Partner Valero [Member] | |||
Allocation of net income to determine net income available to limited partners: | |||
Distributions, excluding general partner’s IDRs | $ 3,363 | $ 2,294 | $ 1,572 |
General partner’s IDRs | 44,534 | 19,354 | 3,431 |
Distributions and DERs declared | 47,897 | 21,648 | 5,003 |
Undistributed earnings, basic and diluted | 1,216 | 1,905 | 1,066 |
Net income available to limited partners – basic and diluted | 49,113 | 23,553 | 6,069 |
Limited Partner [Member] | Limited Partner, Common Units [Member] | |||
Allocation of net income to determine net income available to limited partners: | |||
Distributions, excluding general partner’s IDRs | 128,532 | 79,625 | 39,106 |
Distributions and DERs declared | 128,532 | 79,625 | 39,106 |
Undistributed earnings, basic and diluted | 60,756 | 59,452 | 27,162 |
Net income available to limited partners – basic and diluted | $ 189,288 | $ 139,077 | $ 66,268 |
Net income per limited partner unit – basic and diluted: | |||
Weighted-average units outstanding (shares) | shares | 68,220 | 48,817 | 31,222 |
Net income per limited partner unit – basic and diluted, common units (in dollars per share) | $ / shares | $ 2.77 | $ 2.85 | $ 2.12 |
Limited Partner [Member] | Subordinated Unitholder Valero [Member] | |||
Allocation of net income to determine net income available to limited partners: | |||
Distributions, excluding general partner’s IDRs | $ 20,297 | $ 34,476 | |
Distributions and DERs declared | 20,297 | 34,476 | |
Undistributed earnings, basic and diluted | 21,289 | 25,045 | |
Net income available to limited partners – basic and diluted | $ 41,586 | $ 59,521 | |
Net income per limited partner unit – basic and diluted: | |||
Weighted-average units outstanding (shares) | shares | 17,463 | 28,790 | |
Net income per limited partner unit – basic and diluted, common units (in dollars per share) | $ / shares | $ 2.38 | $ 2.07 | |
Restricted Units [Member] | |||
Allocation of net income to determine net income available to limited partners: | |||
DERs | $ 22 | $ 20 | $ 12 |
Distributions and DERs declared | 22 | 20 | 12 |
Undistributed earnings, basic and diluted | 10 | 17 | 8 |
Net income available to limited partners – basic and diluted | $ 32 | $ 37 | $ 20 |
Partners' Capital Partners' Cap
Partners' Capital Partners' Capital, Unit Activity (Details) - shares | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Partners' Capital Roll Forward (Units) [Abstract] | |||
Beginning balance (shares) | 68,801,684 | 66,651,071 | 58,760,288 |
Unit-based compensation (shares) | 5,997 | 5,958 | 4,443 |
Units issued in connection with acquisitions (shares) | 1,103,383 | 1,917,020 | 3,549,605 |
Units issued under ATM program (shares) | 742,897 | 223,083 | 4,250,000 |
General partner units issued (shares) | 15,602 | 4,552 | 86,735 |
Ending balance (shares) | 70,669,563 | 68,801,684 | 66,651,071 |
Limited Partner [Member] | Common Unitholders Public [Member] | |||
Partners' Capital Roll Forward (Units) [Abstract] | |||
Beginning balance (shares) | 21,738,692 | 21,509,651 | 17,255,208 |
Unit-based compensation (shares) | 5,997 | 5,958 | 4,443 |
Units issued under ATM program (shares) | 742,897 | 223,083 | 4,250,000 |
Ending balance (shares) | 22,487,586 | 21,738,692 | 21,509,651 |
Limited Partner [Member] | Common Unitholder Valero [Member] | |||
Partners' Capital Roll Forward (Units) [Abstract] | |||
Beginning balance (shares) | 45,687,271 | 15,018,602 | 11,539,989 |
Units issued in connection with acquisitions (shares) | 1,081,315 | 1,878,680 | 3,478,613 |
Conversion of subordinated units (shares) | 28,789,989 | ||
Ending balance (shares) | 46,768,586 | 45,687,271 | 15,018,602 |
Limited Partner [Member] | Subordinated Unitholder Valero [Member] | |||
Partners' Capital Roll Forward (Units) [Abstract] | |||
Beginning balance (shares) | 0 | 28,789,989 | 28,789,989 |
Conversion of subordinated units (shares) | (28,789,989) | ||
Ending balance (shares) | 0 | 0 | 28,789,989 |
General Partner Valero [Member] | |||
Partners' Capital Roll Forward (Units) [Abstract] | |||
Beginning balance (shares) | 1,375,721 | 1,332,829 | 1,175,102 |
Units issued in connection with acquisitions (shares) | 22,068 | 38,340 | 70,992 |
General partner units issued (shares) | 15,602 | 4,552 | 86,735 |
Ending balance (shares) | 1,413,391 | 1,375,721 | 1,332,829 |
Partners' Capital (Details)
Partners' Capital (Details) - USD ($) | Nov. 24, 2015 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2017 | Sep. 16, 2016 |
Partners' Capital | ||||||
Proceeds from common units issued, gross | $ 34,176,000 | $ 11,289,000 | $ 192,926,000 | |||
Aggregate offering price of common units, remaining available | $ 304,500,000 | $ 304,500,000 | ||||
Public offering of common units (shares) | 742,897 | 223,083 | 4,250,000 | |||
Common units offering costs | $ 594,000 | $ 883,000 | $ 666,000 | |||
General partner units issued (shares) | 15,602 | 4,552 | 86,735 | |||
Proceeds from general partner units issued | $ 748,000 | $ 198,000 | $ 4,011,000 | |||
Conversion ratio | 1,000 | |||||
Public Offering [Member] | ||||||
Partners' Capital | ||||||
Aggregate offering price of common units | $ 350,000,000 | |||||
Proceeds from common units issued, gross | $ 45,500,000 | |||||
Majority Shareholder [Member] | ||||||
Partners' Capital | ||||||
General partner ownership interest (percent) | 2.00% | 2.00% | ||||
Limited Partner [Member] | Common Unitholders Public [Member] | ||||||
Partners' Capital | ||||||
Proceeds from common units issued, gross | $ 33,428,000 | $ 11,091,000 | $ 188,915,000 | |||
Public offering of common units (shares) | 742,897 | 223,083 | 4,250,000 | |||
Limited Partner [Member] | Common Unitholders Public [Member] | Public Offering [Member] | ||||||
Partners' Capital | ||||||
Proceeds from common units issued, gross | $ 196,600,000 | $ 35,728,000 | $ 9,724,000 | |||
Public offering of common units (shares) | 4,250,000 | 742,897 | 223,083 | |||
Common units offering costs | $ 594,000 | $ 107,000 | ||||
Proceeds from common units issued, net | $ 188,900,000 | 35,134,000 | 9,617,000 | |||
Public offering price per unit (in dollars per unit) | $ 46.25 | |||||
Offering costs | $ 7,700,000 | |||||
General Partner Valero [Member] | ||||||
Partners' Capital | ||||||
Proceeds from common units issued, gross | $ 748,000 | $ 198,000 | $ 4,011,000 | |||
General partner units issued (shares) | 15,602 | 4,552 | 86,735 | |||
General Partner Valero [Member] | General Partner Valero [Member] | ||||||
Partners' Capital | ||||||
General partner units issued (shares) | 86,735 | 15,602 | 4,552 | |||
Proceeds from general partner units issued | $ 4,000,000 | $ 748,000 | $ 198,000 |
Unit-based Compensation (Detail
Unit-based Compensation (Details) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017USD ($)independent_directorshares | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | |
Unit-based Compensation (Textual) | |||
Number of non-employee directors | independent_director | 3 | ||
Unit-based compensation | $ 266 | $ 196 | $ 173 |
VLP 2013 Incentive Compensation Plan [Member] | Incentive Compensation Plan [Member] | |||
Unit-based Compensation (Textual) | |||
Number of common units available to be awarded under the 2013 ICP (shares) | shares | 2,978,394 | ||
VLP 2013 Incentive Compensation Plan [Member] | Restricted Unit [Member] | |||
Unit-based Compensation (Textual) | |||
Unit-based compensation | $ 266 | $ 196 | $ 173 |
Share-based Compensation Award, Tranche One [Member] | VLP 2013 Incentive Compensation Plan [Member] | Restricted Unit [Member] | |||
Unit-based Compensation (Textual) | |||
Restricted unit vesting schedule (percent) | 33.00% | ||
Share-based Compensation Award, Tranche Two [Member] | VLP 2013 Incentive Compensation Plan [Member] | Restricted Unit [Member] | |||
Unit-based Compensation (Textual) | |||
Restricted unit vesting schedule (percent) | 33.00% | ||
Share-based Compensation Award, Tranche Three [Member] | VLP 2013 Incentive Compensation Plan [Member] | Restricted Unit [Member] | |||
Unit-based Compensation (Textual) | |||
Restricted unit vesting schedule (percent) | 33.00% |
Income Taxes (Details)
Income Taxes (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Components of Income Tax Expense | |||
Current U.S. state | $ 942,000 | $ 704,000 | $ 479,000 |
Deferred U.S. state | 393,000 | 408,000 | (228,000) |
Income tax expense | $ 1,335,000 | $ 1,112,000 | $ 251,000 |
Income Taxes (Textual) | |||
Statutory federal income tax rate (percent) | 35.00% | 35.00% | 35.00% |
Liability for unrecognized tax benefits | $ 0 | $ 0 | |
Interest or penalties accrued | $ 0 | $ 0 | $ 0 |
Supplemental Cash Flow Inform55
Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands | Sep. 01, 2016 | Apr. 01, 2016 | Oct. 01, 2015 | Mar. 01, 2015 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Decrease (increase) in current assets: | |||||||
Receivables – related party | $ (9,607) | $ (10,786) | $ (15,588) | ||||
Receivables | (781) | 0 | 0 | ||||
Prepaid expenses and other | 277 | (365) | 95 | ||||
Increase (decrease) in current liabilities: | |||||||
Accounts payable | 7,411 | 586 | (631) | ||||
Accounts payable – related party | (3,404) | (667) | 5,999 | ||||
Accrued liabilities | 137 | 34 | (87) | ||||
Accrued liabilities – related party | 10 | 40 | 21 | ||||
Accrued interest payable | 1,278 | 1,054 | 226 | ||||
Accrued interest payable – related party | 864 | (429) | 476 | ||||
Taxes other than income taxes payable | 2,684 | 1,181 | 511 | ||||
Deferred revenue – related party | (2,599) | 3,396 | 5 | ||||
Changes in current assets and current liabilities | (3,730) | (5,956) | (8,973) | ||||
Cash Flows Related to Interest and Income Taxes | |||||||
Interest paid | 33,355 | 13,873 | 5,367 | ||||
Income taxes paid | 719 | 505 | 441 | ||||
Investing and Financing Cash Outflows in Connection with Acquisitions | |||||||
Financing cash outflow | 54,618 | 376,393 | 576,076 | ||||
Other Noncash Activities | |||||||
Increase in accounts payable related to capital expenditures | 570 | 904 | 5,496 | ||||
Offering costs included in accounts payable | 0 | 0 | (102) | ||||
Units issued under ATM Program included in receivables | 0 | 1,682 | 0 | ||||
Majority Shareholder [Member] | |||||||
Investing and Financing Cash Outflows in Connection with Acquisitions | |||||||
Investing cash outflow | 407,844 | 103,607 | 390,144 | ||||
Financing cash outflow | 54,618 | 376,393 | 576,076 | ||||
Investing and financing cash outflow, total | 462,462 | 480,000 | 966,220 | ||||
Transfer (from) to Valero for: | |||||||
Deferred income taxes | 0 | (144) | |||||
Change in accrued capital expenditures | 6,950 | ||||||
Other Noncash Activities | |||||||
Units issued to Valero Energy Corporation in connection with acquisitions | 46,000 | 85,000 | 170,000 | ||||
Majority Shareholder [Member] | Limited Partner [Member] | Common Unitholder Valero [Member] | |||||||
Other Noncash Activities | |||||||
Noncash conversion of subordinated units issued | 406,400 | ||||||
Majority Shareholder [Member] | Limited Partner [Member] | Subordinated Unitholder Valero [Member] | |||||||
Other Noncash Activities | |||||||
Noncash conversion of subordinated units converted | (406,400) | ||||||
Majority Shareholder [Member] | McKee Terminal Services Business [Member] | |||||||
Investing and Financing Cash Outflows in Connection with Acquisitions | |||||||
Investing cash outflow | 51,361 | ||||||
Financing cash outflow | 152,639 | ||||||
Investing and financing cash outflow, total | $ 204,000 | 204,000 | |||||
Majority Shareholder [Member] | Meraux and Three Rivers Terminal Services Business [Member] | |||||||
Investing and Financing Cash Outflows in Connection with Acquisitions | |||||||
Investing cash outflow | 52,246 | ||||||
Financing cash outflow | 223,754 | ||||||
Investing and financing cash outflow, total | $ 276,000 | 276,000 | |||||
Majority Shareholder [Member] | Houston and St. Charles Terminal Services Business [Member] | |||||||
Investing and Financing Cash Outflows in Connection with Acquisitions | |||||||
Investing cash outflow | 296,109 | ||||||
Financing cash outflow | 275,111 | ||||||
Investing and financing cash outflow, total | $ 571,200 | 571,220 | |||||
Majority Shareholder [Member] | Corpus Christi Terminal Services Business [Member] | |||||||
Investing and Financing Cash Outflows in Connection with Acquisitions | |||||||
Investing cash outflow | 94,035 | ||||||
Financing cash outflow | 300,965 | ||||||
Investing and financing cash outflow, total | $ 395,000 | 395,000 | |||||
Parkway Pipeline [Member] | Majority Shareholder [Member] | |||||||
Investing and Financing Cash Outflows in Connection with Acquisitions | |||||||
Investing cash outflow | 200,249 | ||||||
Financing cash outflow | 0 | ||||||
Investing and financing cash outflow, total | 200,249 | ||||||
Noncash contributions from Valero: | |||||||
Excess of carrying value over purchase price paid for acquisition of Parkway Pipeline | 51,702 | 0 | 0 | ||||
Port Arthur Terminal [Member] | Majority Shareholder [Member] | |||||||
Investing and Financing Cash Outflows in Connection with Acquisitions | |||||||
Investing cash outflow | 207,595 | ||||||
Financing cash outflow | 54,618 | ||||||
Investing and financing cash outflow, total | 262,213 | ||||||
Capital Projects [Member] | Majority Shareholder [Member] | |||||||
Noncash contributions from Valero: | |||||||
Capital projects | 41,305 | 35,732 | 27,748 | ||||
Deferred Income Taxes [Member] | Majority Shareholder [Member] | |||||||
Transfer (from) to Valero for: | |||||||
Deferred income taxes | 0 | (190) | (282) | ||||
Construction-in-progress [Member] | Majority Shareholder [Member] | |||||||
Transfer (from) to Valero for: | |||||||
Change in accrued capital expenditures | $ 0 | $ 46 | $ 7,232 |
Fair Value of Financial Instr56
Fair Value of Financial Instruments (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 |
Financial assets: | ||||
Cash and cash equivalents | $ 42,052 | $ 71,491 | $ 80,783 | $ 236,579 |
Financial liabilities: | ||||
Debt, at carrying amount | 905,283 | 525,355 | ||
Notes payable to related party, at carrying amount | 370,000 | 370,000 | ||
Fair Value, Inputs, Level 1 [Member] | ||||
Financial assets: | ||||
Cash and cash equivalents, at fair value | 42,052 | 71,491 | ||
Fair Value, Inputs, Level 2 [Member] | ||||
Financial liabilities: | ||||
Notes payable to related party, at fair value | 370,000 | 370,000 | ||
Revolving Credit Facility [Member] | ||||
Financial liabilities: | ||||
Debt, at carrying amount | 410,000 | 30,000 | ||
Revolving Credit Facility [Member] | Fair Value, Inputs, Level 2 [Member] | ||||
Financial liabilities: | ||||
Debt, at fair value | 410,000 | 30,000 | ||
Senior Notes [Member] | ||||
Financial liabilities: | ||||
Debt, at carrying amount | 495,283 | 495,355 | ||
Senior Notes [Member] | Fair Value, Inputs, Level 2 [Member] | ||||
Financial liabilities: | ||||
Debt, at fair value | $ 523,800 | $ 506,670 | ||
Senior Notes Due in 2026 [Member] | Senior Notes [Member] | ||||
Financial liabilities: | ||||
Interest rate of notes (percent) | 4.375% | 4.375% |
Quarterly Financial Data (Una57
Quarterly Financial Data (Unaudited) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Quarterly Financial Data | |||||||||||
Operating revenues – related party | $ 126,304 | $ 109,340 | $ 110,545 | $ 105,816 | $ 104,148 | $ 92,040 | $ 87,664 | $ 78,767 | $ 452,005 | $ 362,619 | $ 243,624 |
Gross profit | 78,926 | 70,749 | 70,985 | 70,496 | 69,181 | 56,632 | 51,757 | 42,969 | |||
Operating income | 74,895 | 66,347 | 67,122 | 66,666 | 65,390 | 52,538 | 48,042 | 38,604 | 275,030 | 204,574 | 77,453 |
Net income | 64,264 | 57,589 | 58,443 | 58,137 | 59,799 | 48,707 | 44,545 | 35,780 | 238,433 | 188,831 | 71,312 |
Net income attributable to partners | 64,264 | 57,589 | 58,443 | 58,137 | 59,799 | 51,709 | 49,447 | 43,298 | 238,433 | 204,253 | 131,878 |
Limited partners’ interest in net income | $ 49,074 | $ 44,552 | $ 47,024 | $ 48,670 | $ 51,597 | $ 45,075 | $ 44,234 | $ 39,794 | $ 189,320 | $ 180,700 | $ 125,809 |
Net income per limited partner unit – basic and diluted, common units (in dollars per share) | $ 2.77 | $ 2.85 | $ 2.12 | ||||||||
Net income per limited partner unit – basic and diluted, subordinated units (in dollars per share) | $ 0 | $ 2.38 | $ 2.07 | ||||||||
Limited Partner, Common Units [Member] | |||||||||||
Quarterly Financial Data | |||||||||||
Net income per limited partner unit – basic and diluted, common units (in dollars per share) | $ 0.71 | $ 0.65 | $ 0.69 | $ 0.72 | $ 0.77 | $ 0.77 | $ 0.67 | $ 0.61 | |||
Subordinated Unitholder Valero [Member] | |||||||||||
Quarterly Financial Data | |||||||||||
Net income per limited partner unit – basic and diluted, subordinated units (in dollars per share) | $ 0 | $ 0.29 | $ 0.67 | $ 0.61 |