Cover Page
Cover Page - shares | 9 Months Ended | |
Sep. 30, 2019 | Oct. 31, 2019 | |
Cover page. | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Sep. 30, 2019 | |
Document Transition Report | false | |
Entity File Number | 001-37640 | |
Entity Registrant Name | NOBLE MIDSTREAM PARTNERS LP | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 47-3011449 | |
Entity Address, Address Line One | 1001 Noble Energy Way | |
Entity Address, City or Town | Houston, | |
Entity Address, State or Province | TX | |
Entity Address, Postal Zip Code | 77070 | |
City Area Code | (281) | |
Local Phone Number | 872-3100 | |
Title of 12(b) Security | Common Units, Representing Limited Partner Interests | |
Trading Symbol | NBLX | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Units Outstanding | 39,707,343 | |
Entity Central Index Key | 0001647513 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Current Assets | ||
Cash and Cash Equivalents | $ 17,571 | $ 10,740 |
Accounts Receivable — Affiliate | 40,475 | 31,613 |
Accounts Receivable — Third Party | 20,251 | 23,091 |
Other Current Assets | 8,579 | 5,875 |
Total Current Assets | 86,876 | 71,319 |
Property, Plant and Equipment | ||
Total Property, Plant and Equipment, Gross | 1,682,820 | 1,500,609 |
Less: Accumulated Depreciation and Amortization | (114,789) | (79,357) |
Total Property, Plant and Equipment, Net | 1,568,031 | 1,421,252 |
Intangible Assets, Net | 286,042 | 310,202 |
Goodwill | 109,734 | 109,734 |
Investments | 565,387 | 82,317 |
Other Noncurrent Assets | 6,696 | 3,093 |
Total Assets | 2,622,766 | 1,997,917 |
Current Liabilities | ||
Accounts Payable — Affiliate | 2,568 | 2,778 |
Accounts Payable — Trade | 100,157 | 92,756 |
Other Current Liabilities | 10,238 | 9,217 |
Total Current Liabilities | 112,963 | 104,751 |
Long-Term Liabilities | ||
Long-Term Debt | 948,907 | 559,021 |
Asset Retirement Obligations | 19,268 | 17,330 |
Other Long-Term Liabilities | 1,410 | 582 |
Total Liabilities | 1,082,548 | 681,684 |
Mezzanine Equity | ||
Redeemable Noncontrolling Interest, Net | 102,830 | 0 |
Equity | ||
General Partner | 5,820 | 2,421 |
Total Partners’ Equity | 623,869 | 572,080 |
Noncontrolling Interests | 813,519 | 744,153 |
Total Equity | 1,437,388 | 1,316,233 |
Total Liabilities, Mezzanine Equity and Equity | 2,622,766 | 1,997,917 |
Common Units (39,712 and 23,759 units outstanding, respectively) | ||
Equity | ||
Limited Partner | 618,049 | 699,866 |
Noble | Subordinated Units (15,903 units outstanding as of December 31, 2018) | ||
Equity | ||
Limited Partner | $ 0 | $ (130,207) |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - shares shares in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Common Units | ||
Units outstanding (in shares) | 39,712 | 23,759 |
Noble Energy | Subordinated Units | ||
Units outstanding (in shares) | 0 | 15,903 |
Consolidated Statements of Oper
Consolidated Statements of Operations and Comprehensive Income - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Revenues | ||||
Midstream Services — Affiliate | $ 100,846 | $ 73,136 | $ 278,724 | $ 204,323 |
Total Revenues | 169,323 | 139,163 | 475,544 | 358,867 |
Costs and Expenses | ||||
Cost of Crude Oil Sales | 46,240 | 44,379 | 125,217 | 105,830 |
Direct Operating | 22,524 | 23,955 | 77,677 | 59,496 |
Depreciation and Amortization | 20,851 | 18,376 | 60,487 | 46,076 |
General and Administrative | 4,129 | 4,204 | 12,990 | 19,626 |
Other Operating (Income) Expense | (469) | 0 | (488) | 0 |
Total Operating Expenses | 93,275 | 90,914 | 275,883 | 231,028 |
Operating Income | 76,048 | 48,249 | 199,661 | 127,839 |
Other Expense (Income) | ||||
Interest Expense, Net of Amount Capitalized | 3,952 | 3,506 | 11,507 | 6,220 |
Investment Loss (Income) | 5,621 | (3,866) | 5,028 | (10,825) |
Total Other Expense (Income) | 9,573 | (360) | 16,535 | (4,605) |
Income Before Income Taxes | 66,475 | 48,609 | 183,126 | 132,444 |
State Income Tax Provision | 92 | (94) | 290 | 163 |
Net Income | 66,383 | 48,703 | 182,836 | 132,281 |
Less: Net Income Attributable to Noncontrolling Interests | 25,751 | 4,086 | 62,236 | 11,719 |
Net Income Attributable to Noble Midstream Partners LP | 40,632 | 44,617 | 120,600 | 120,562 |
Less: Net Income Attributable to Incentive Distribution Rights | 5,820 | 1,462 | 13,967 | 3,415 |
Net Income Attributable to Limited Partners | 34,812 | 43,155 | 106,633 | 117,147 |
Common Units | ||||
Other Expense (Income) | ||||
Net Income Attributable to Limited Partners | $ 34,812 | $ 25,825 | $ 84,266 | $ 70,093 |
Net Income Attributable to Limited Partners Per Limited Partner Unit — Basic | ||||
Net Income Attributable to Limited Partners Per Limited Partner Unit — Basic (in usd per share) | $ 0.88 | $ 1.09 | $ 2.65 | $ 2.96 |
Net Income Attributable to Limited Partners Per Limited Partner Unit — Diluted | ||||
Net Income Attributable to Limited Partners Per Limited Partner Unit — Diluted (in usd per share) | $ 0.88 | $ 1.09 | $ 2.64 | $ 2.96 |
Weighted Average Limited Partner Units Outstanding — Basic | ||||
Basic (in sharers) | 39,604 | 23,688 | 31,855 | 23,686 |
Weighted Average Limited Partner Units Outstanding —Diluted | ||||
Diluted (in shares) | 39,624 | 23,704 | 31,879 | 23,701 |
Subordinated Units | ||||
Other Expense (Income) | ||||
Net Income Attributable to Limited Partners | $ 0 | $ 17,330 | $ 22,367 | $ 47,054 |
Net Income Attributable to Limited Partners Per Limited Partner Unit — Basic | ||||
Net Income Attributable to Limited Partners Per Limited Partner Unit — Basic (in usd per share) | $ 0 | $ 1.09 | $ 2.89 | $ 2.96 |
Net Income Attributable to Limited Partners Per Limited Partner Unit — Diluted | ||||
Net Income Attributable to Limited Partners Per Limited Partner Unit — Diluted (in usd per share) | $ 0 | $ 1.09 | $ 2.89 | $ 2.96 |
Weighted Average Limited Partner Units Outstanding — Basic | ||||
Basic (in sharers) | 0 | 15,903 | 7,747 | 15,903 |
Weighted Average Limited Partner Units Outstanding —Diluted | ||||
Diluted (in shares) | 0 | 15,903 | 7,747 | 15,903 |
Midstream Services — Third Party | ||||
Revenues | ||||
Services and Sales Revenues - Third Party | $ 19,607 | $ 19,934 | $ 63,298 | $ 44,763 |
Crude Oil Sales — Third Party | ||||
Revenues | ||||
Services and Sales Revenues - Third Party | $ 48,870 | $ 46,093 | $ 133,522 | $ 109,781 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | ||
Cash Flows From Operating Activities | |||
Net Income | $ 182,836 | $ 132,281 | |
Adjustments to Reconcile Net Income to Net Cash Provided by Operating Activities | |||
Depreciation and Amortization | 60,487 | 46,076 | |
Loss (Income) from Equity Method Investees | 8,858 | (7,569) | |
Distributions from Equity Method Investees | 8,655 | 3,520 | |
Unit-Based Compensation | 683 | 1,057 | |
Other Adjustments for Noncash Items Included in Income | 573 | 523 | |
Changes in Operating Assets and Liabilities, Net of Assets Acquired and Liabilities Assumed | |||
Increase in Accounts Receivable | (8,696) | (14,054) | |
Increase in Accounts Payable | 16,886 | 7,173 | |
Other Operating Assets and Liabilities, Net | (4,161) | (1,071) | |
Net Cash Provided by Operating Activities | 266,121 | 167,936 | |
Cash Flows From Investing Activities | |||
Additions to Property, Plant and Equipment | (189,021) | (540,991) | |
Black Diamond Acquisition, Net of Cash Acquired | 0 | (649,868) | |
Additions to Investments | (501,344) | (426) | |
Distributions from Cost Method Investee and Other | 856 | 1,020 | |
Net Cash Used in Investing Activities | (689,509) | (1,190,265) | |
Cash Flows From Financing Activities | |||
Distributions to Noncontrolling Interests | (17,973) | (5,814) | |
Contributions from Noncontrolling Interests | 45,494 | 593,034 | |
Borrowings Under Revolving Credit Facility | 655,000 | 690,000 | |
Repayment of Revolving Credit Facility | (665,000) | (725,000) | |
Proceeds from Term Loan Credit Facilities | 400,000 | 500,000 | |
Distributions to Unitholders | (83,517) | (63,220) | |
Proceeds from Preferred Equity, Net of Issuance Costs | 97,198 | 0 | |
Debt Issuance Costs and Other | (1,884) | (3,050) | |
Net Cash Provided by Financing Activities | 429,318 | 985,950 | |
Increase (Decrease) in Cash, Cash Equivalents, and Restricted Cash | 5,930 | (36,379) | |
Cash, Cash Equivalents, and Restricted Cash at Beginning of Period (1) | [1] | 11,691 | 55,531 |
Cash, Cash Equivalents, and Restricted Cash at End of Period (1) | [1] | $ 17,621 | $ 19,152 |
[1] | See Note 2. Basis of Presentation for our reconciliation of total cash. |
Consolidated Statements of Chan
Consolidated Statements of Changes in Equity - USD ($) $ in Thousands | Total | Noncontrolling Interests | Limited PartnerCommon Units | Limited PartnerSubordinated UnitsNoble | General Partner | |
Capital, beginning at Dec. 31, 2017 | $ 616,230 | $ 141,230 | $ 642,616 | $ (168,136) | $ 520 | |
Increase (Decrease) in Partners' Capital [Roll Forward] | ||||||
Net Income | 39,136 | (225) | 23,058 | 15,484 | 819 | |
Contributions from Noncontrolling Interests | 409,865 | 409,865 | ||||
Distributions to Noncontrolling Interests | (3,007) | (3,007) | ||||
Distributions to Unitholders | (19,860) | (11,575) | (7,765) | (520) | ||
Black Diamond Equity Ownership Promote Vesting | [1] | (2,429) | 1,215 | 1,214 | ||
Unit-Based Compensation and Other | 288 | 288 | ||||
Capital, ending at Mar. 31, 2018 | 1,042,652 | 545,434 | 655,602 | (159,203) | 819 | |
Capital, beginning at Dec. 31, 2017 | 616,230 | 141,230 | 642,616 | (168,136) | 520 | |
Increase (Decrease) in Partners' Capital [Roll Forward] | ||||||
Net Income | 132,281 | |||||
Capital, ending at Sep. 30, 2018 | 1,273,534 | 727,512 | 684,715 | (140,155) | 1,462 | |
Capital, beginning at Mar. 31, 2018 | 1,042,652 | 545,434 | 655,602 | (159,203) | 819 | |
Increase (Decrease) in Partners' Capital [Roll Forward] | ||||||
Net Income | 44,442 | 7,858 | 21,210 | 14,240 | 1,134 | |
Contributions from Noncontrolling Interests | 105,757 | 105,757 | ||||
Distributions to Noncontrolling Interests | (522) | (522) | ||||
Distributions to Unitholders | (21,053) | (12,108) | (8,126) | (819) | ||
Black Diamond Equity Ownership Promote Vesting | [1] | (4,564) | 2,731 | 1,833 | ||
Unit-Based Compensation and Other | 395 | 395 | ||||
Capital, ending at Jun. 30, 2018 | 1,171,671 | 653,963 | 667,830 | (151,256) | 1,134 | |
Increase (Decrease) in Partners' Capital [Roll Forward] | ||||||
Net Income | 48,703 | 4,086 | 25,825 | 17,330 | 1,462 | |
Contributions from Noncontrolling Interests | 77,412 | 77,412 | ||||
Distributions to Noncontrolling Interests | (2,285) | (2,285) | ||||
Distributions to Unitholders | (22,307) | (12,669) | (8,504) | (1,134) | ||
Black Diamond Equity Ownership Promote Vesting | [1] | (5,664) | 3,389 | 2,275 | ||
Unit-Based Compensation and Other | 340 | 340 | ||||
Capital, ending at Sep. 30, 2018 | 1,273,534 | 727,512 | 684,715 | (140,155) | 1,462 | |
Capital, beginning at Dec. 31, 2018 | 1,316,233 | 744,153 | 699,866 | (130,207) | 2,421 | |
Increase (Decrease) in Partners' Capital [Roll Forward] | ||||||
Net Income | 63,255 | 19,696 | 23,967 | 16,085 | 3,507 | |
Contributions from Noncontrolling Interests | 15,969 | 15,969 | ||||
Distributions to Noncontrolling Interests | (4,669) | (4,669) | ||||
Distributions to Unitholders | (25,667) | (13,930) | (9,316) | (2,421) | ||
Black Diamond Equity Ownership Promote Vesting | [1] | (6,838) | 4,092 | 2,746 | ||
Unit-Based Compensation and Other | 470 | 470 | ||||
Capital, ending at Mar. 31, 2019 | 1,365,591 | 768,311 | 714,465 | (120,692) | 3,507 | |
Capital, beginning at Dec. 31, 2018 | 1,316,233 | 744,153 | 699,866 | (130,207) | 2,421 | |
Increase (Decrease) in Partners' Capital [Roll Forward] | ||||||
Net Income | 182,836 | |||||
Preferred Equity Accretion | (6,300) | |||||
Capital, ending at Sep. 30, 2019 | 1,437,388 | 813,519 | 618,049 | 0 | 5,820 | |
Capital, beginning at Mar. 31, 2019 | 1,365,591 | 768,311 | 714,465 | (120,692) | 3,507 | |
Increase (Decrease) in Partners' Capital [Roll Forward] | ||||||
Net Income | 53,198 | 16,789 | 25,487 | 6,282 | 4,640 | |
Contributions from Noncontrolling Interests | 18,141 | 18,141 | ||||
Distributions to Noncontrolling Interests | (7,316) | (7,316) | ||||
Distributions to Unitholders | (27,792) | (14,534) | (9,751) | (3,507) | ||
Black Diamond Equity Ownership Promote Vesting | [1] | (8,196) | 8,196 | |||
Conversion of Subordinated Units to Common Units | [2] | (124,161) | 124,161 | |||
Preferred Equity Accretion | (3,151) | (3,151) | ||||
Unit-Based Compensation and Other | 273 | 273 | ||||
Capital, ending at Jun. 30, 2019 | 1,398,944 | 787,729 | 606,575 | 0 | 4,640 | |
Increase (Decrease) in Partners' Capital [Roll Forward] | ||||||
Net Income | 66,383 | 25,751 | 34,812 | 5,820 | ||
Contributions from Noncontrolling Interests | 11,384 | 11,384 | ||||
Distributions to Noncontrolling Interests | (5,988) | (5,988) | ||||
Distributions to Unitholders | (30,058) | (25,418) | (4,640) | |||
Black Diamond Equity Ownership Promote Vesting | [1] | (5,357) | 5,357 | |||
Preferred Equity Accretion | (3,114) | (3,114) | ||||
Unit-Based Compensation and Other | (163) | (163) | ||||
Capital, ending at Sep. 30, 2019 | $ 1,437,388 | $ 813,519 | $ 618,049 | $ 0 | $ 5,820 | |
[1] | See Note 2. Basis of Presentation for further discussion of the Black Diamond equity ownership promote vesting. | |||||
[2] | See Note 10. Partnership Distributions |
Organization and Nature of Oper
Organization and Nature of Operations | 9 Months Ended |
Sep. 30, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Nature of Operations | Organization Noble Midstream Partners LP (the Partnership, NBLX, we, us or our) is a growth-oriented Delaware master limited partnership formed in December 2014 by our sponsor, Noble Energy, Inc. (Noble or Parent), to own, operate, develop and acquire a wide range of domestic midstream infrastructure assets. Our current focus areas are the Denver-Julesburg Basin (DJ Basin) in Colorado and the Southern Delaware Basin position of the Permian Basin (Delaware Basin) in Texas. Partnership Assets Our assets consist of ownership interests in certain development companies (DevCos) which serve specific areas and integrated development plan (IDP) areas and consist of the following: DevCo Areas Served NBLX Dedicated Service NBLX Ownership Noncontrolling Interest (1) Colorado River DevCo LP Wells Ranch IDP (DJ Basin) East Pony IDP (DJ Basin) All Noble DJ Basin Acreage Crude Oil Gathering Natural Gas Gathering Water Services Crude Oil Gathering Crude Oil Treating 100% N/A San Juan River DevCo LP East Pony IDP (DJ Basin) Water Services 25% 75% Green River DevCo LP Mustang IDP (DJ Basin) Crude Oil Gathering Natural Gas Gathering Water Services 25% 75% Laramie River DevCo LP Greeley Crescent IDP (DJ Basin) Crude Oil Gathering Water Services 100% N/A Black Diamond Dedication Area (DJ Basin) Crude Oil Gathering Natural Gas Gathering 54.4% 45.6% Blanco River DevCo LP Delaware Basin Crude Oil Gathering Natural Gas Gathering Produced Water Services 40% 60% Gunnison River DevCo LP Bronco IDP (DJ Basin) Crude Oil Gathering Water Services 5% 95% Trinity River DevCo LLC (2) Delaware Basin Crude Oil Transmission Natural Gas Compression 100% N/A Dos Rios DevCo LLC (3) Delaware Basin Crude Oil Transmission Y-Grade Transmission 100% N/A (1) The noncontrolling interest represents Noble’s retained ownership interest in each DevCo. The noncontrolling interest in Black Diamond Gathering LLC (Black Diamond) represents Greenfield Member’s interest in Black Diamond. (2) Our ownership interest in Advantage Pipeline Holdings, L.L.C. (the Advantage Joint Venture) is owned through Trinity River DevCo LLC. See Note 7. Investments . (3) Our ownership interests in Delaware Crossing LLC (the Delaware Crossing Joint Venture), EPIC Y-Grade, LP (EPIC Y-Grade) and EPIC Crude Holdings, LP (EPIC Crude) are owned through wholly-owned subsidiaries of Dos Rios DevCo LLC. See Note 7. Investments . Nature of Operations Through our ownership interests in the DevCos, we operate and own interests in the following assets: • crude oil gathering systems; • natural gas gathering systems and compression units; • crude oil treating facilities; • produced water collection, gathering, and cleaning systems; • fresh water storage and delivery systems; and • investments in midstream entities that provide transportation services. We generate revenues primarily by charging fees on a per unit basis for gathering crude oil and natural gas, delivering and storing fresh water, and collecting, cleaning and disposing of produced water. Additionally, we purchase and sell crude oil to customers at various delivery points on our gathering systems. |
Basis of Presentation
Basis of Presentation | 9 Months Ended |
Sep. 30, 2019 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Note 2. Basis of Presentation Basis of Presentation and Consolidation The accompanying unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (U.S. GAAP) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and notes required by U.S. GAAP for complete financial statements. The accompanying consolidated financial statements at September 30, 2019 and December 31, 2018 and for the three and nine months ended September 30, 2019 and 2018 contain all normally recurring adjustments considered necessary for a fair presentation of our financial position, results of operations, cash flows and equity for such periods. In Note 8. Segment Information , we report a new Investments in Midstream Entities reportable segment and present prior period amounts on a comparable basis. Prior period segment information has been reclassified to conform to the current period presentation. Operating results for the three and nine months ended September 30, 2019 are not necessarily indicative of the results that may be expected for the year ending December 31, 2019 . We have no items of other comprehensive income; therefore, our net income is identical to our comprehensive income. Variable Interest Entities Our consolidated financial statements include our accounts and the accounts of the DevCos, each of which we control as general partner. All intercompany balances and transactions have been eliminated upon consolidation. We have determined that the partners with equity at risk in each of the DevCos lack the authority, through voting rights or similar rights, to direct the activities that most significantly impact their economic performance; therefore, each DevCo is considered a variable interest entity, or VIE. Through our 100% ownership interest in Noble Midstream Services, LLC, a Delaware limited liability company which owns controlling interests in each of the DevCos, we have the authority to direct the activities that most significantly affect economic performance and the obligation to absorb losses or the right to receive benefits that could be potentially significant to us. Therefore, we are considered the primary beneficiary and consolidate each of the DevCos in our financial statements. A substantial portion of the financial statement activity associated with our DevCos is captured within the Gathering Systems and Fresh Water Delivery reportable segments. Although our unconsolidated investments are owned through certain DevCos, all financial statement activity associated with our unconsolidated investments are captured within the Investments in Midstream Entities reportable segment. See Note 7. Investments and Note 8. Segment Information . On January 31, 2018, Black Diamond, an entity formed by Black Diamond Gathering Holdings LLC (the Noble Member), a wholly-owned subsidiary of Noble Midstream Partners LP, and Greenfield Midstream, LLC (the Greenfield Member), completed the acquisition of all of the issued and outstanding limited liability company interests in Saddle Butte Rockies Midstream, LLC and certain affiliates (collectively, Saddle Butte) from Saddle Butte Pipeline II, LLC (Seller). The acquisition of Saddle Butte will be referred to as the Black Diamond Acquisition. See Note 3. Acquisition . Our consolidated financial statements include the accounts of Black Diamond, which we control. We have determined that the partners with equity at risk in Black Diamond lack the authority, through voting rights or similar rights, to direct the activities that most significantly impact their economic performance. Therefore, Black Diamond is considered a VIE. Through our majority representation on the Black Diamond company board of directors as well as our responsibility as operator of the acquired system, we have the authority to direct the activities that most significantly affect economic performance and the obligation to absorb losses or the right to receive benefits that could be potentially significant to us. Therefore, we are considered the primary beneficiary and consolidate Black Diamond in our financial statements. Black Diamond Equity Ownership Promote Vesting In accordance with the limited liability company agreement of Black Diamond, Noble Member received an equity ownership promote. The limited liability company agreement of Black Diamond required special allocations of gross income to balance the ratio of each member’s capital account to its agreed equity ownership interest over time. The special allocations were accounted for as equity transactions between the Partnership and a subsidiary with no gain or loss recognized. As of September 30, 2019 , each member’s capital account agreed to its equity ownership interest and no further special allocations are required. See Note 3. Acquisition . Noncontrolling Interests We present our consolidated financial statements with a noncontrolling interest section representing Noble’s retained ownership of our DevCos as well as Greenfield Member’s ownership of Black Diamond. Redeemable Noncontrolling Interest On March 25, 2019, we, through Dos Rios Crude Intermediate LLC, a wholly-owned subsidiary of Dos Rios DevCo LLC, secured a $200 million equity commitment from GIP CAPS Dos Rios Holding Partnership, L.P. (GIP). Upon securing the equity commitment, we issued 100,000 preferred units, with a face value of $1,000 per preferred unit (Preferred Equity). Proceeds from the Preferred Equity totaled $100 million and we incurred offering costs of $3.4 million . The remaining $100 million equity commitment is available for a one-year period, subject to certain conditions precedent. Proceeds from the Preferred Equity were utilized to repay a portion of outstanding borrowings under our revolving credit facility. See Note 6. Debt . We can redeem the Preferred Equity in whole or in part at any time for cash at a predetermined redemption price. The predetermined redemption price is based on the greater of a defined internal rate of return or the multiple on invested capital. GIP can request redemption of the Preferred Equity following the later of the sixth anniversary of the Preferred Equity closing or the fifth anniversary of the EPIC Crude pipeline completion date at a pre-determined base return. As GIP’s redemption right is outside of our control, the Preferred Equity is not considered to be a component of equity on the consolidated balance sheet, and such Preferred Equity is reported as mezzanine equity on the consolidated balance sheet. In addition, because the Preferred Equity was issued by a subsidiary of the Partnership and is held by a third party, it is considered a redeemable noncontrolling interest. The Preferred Equity was recorded initially at fair value on the issuance date. Subsequent to issuance, we accrete changes in the redemption value of the Preferred Equity from the date of issuance to GIP’s earliest redemption date of the Preferred Equity. The Preferred Equity is perpetual and has a 6.5% annual dividend rate, payable quarterly in cash, with the ability to accrue unpaid dividends during the first two years following the closing. During any quarter in which a dividend is accrued, the accreted value of the Preferred Equity will be increased by the accrued but unpaid dividend (i.e., a paid-in-kind dividend). The dividends for the first three quarters of 2019 were paid-in-kind. Accretion during the three and nine months ended September 30, 2019 was approximately $3.1 million and $6.3 million , respectively. Accounting for Investments We use the equity method of accounting for our investments in the Advantage Joint Venture, the Delaware Crossing Joint Venture, EPIC Y-Grade and EPIC Crude, as we do not control, but do exert significant influence over their operations. We use the cost method of accounting for our investment in White Cliffs Pipeline L.L.C. (White Cliffs) as we have virtually no influence over its operations and financial policies. See Note 7. Investments . Leases We determine whether an arrangement contains a lease based on the conveyed rights and obligations at the inception date. If an agreement contains a lease, at the commencement date, we record a right-of-use (ROU) asset and a corresponding lease liability based on the present value of lease payments over the lease term. As most of our leases do not provide an implicit rate to determine the present value of lease payments, we use our hypothetical secured borrowing rate based on information available at lease commencement. The weighted average discount rate is 3.69% for operating leases and 2.80% for our finance lease. Leases with an initial term of 12 months or less are not recorded on the balance sheet and we recognize lease expense for these leases on a straight-line basis over the lease term. Most leases include one or more options to renew, with renewal terms that can extend the lease term from one month to one year or more. Additionally, some of our leases include an option for early termination. We include renewal periods and exclude termination periods from our lease term if, at commencement, it is reasonably likely that we will exercise the option. Additionally, we have lease agreements that include lease and non-lease components, which are generally accounted for as a single lease component. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants. See Note 9. Leases Use of Estimates The preparation of consolidated financial statements in conformity with U.S. GAAP requires us to make a number of estimates and assumptions relating to the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ significantly from those estimates. Management evaluates estimates and assumptions on an ongoing basis using historical experience and other factors, including the current economic and commodity price environment. Intangible Assets Our intangible asset accumulated amortization totaled approximately $53.7 million and $29.6 million as of September 30, 2019 and December 31, 2018, respectively. Intangible asset amortization expense totaled approximately $8.1 million for the three months ended September 30, 2019 and 2018 and $24.2 million and $21.4 million for the nine months ended September 30, 2019 and 2018, respectively. The weighted average amortization period for our intangible assets is approximately 11 years . Recently Adopted Accounting Standards Leases In February 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update No. 2016-02 (ASU 2016-02), which creates Topic 842 – Leases (ASC 842). The standard requires lessees to recognize a ROU asset and lease liability on the balance sheet for the rights and obligations created by leases. ASC 842 also requires disclosures designed to give financial statement users information on the amount, timing, and uncertainty of cash flows arising from leases. The new standard provided a number of optional practical expedients. We elected: • the package of ‘practical expedients’, permitting us not to reassess our prior conclusions about lease identification, lease classification and initial direct costs; • the practical expedient pertaining to land easements, allowing us to account for existing land easements under previous accounting policy; and • the practical expedient to not separate lease and non-lease components for the majority of our leases. We adopted ASC 842 on January 1, 2019 using the modified retrospective approach. The standard did not materially impact our consolidated balance sheet or consolidated statement of operations and had no impact on our consolidated statement of cash flows. Prior period financial statements were not adjusted. See Note 9. Leases . Recently Issued Accounting Standards Financial Instruments: Credit Losses In June 2016, the FASB issued Accounting Standards Update No. 2016-13 (ASU 2016-13): Financial Instruments – Credit Losses , which replaces the incurred loss impairment methodology with a methodology that reflects current expected credit losses. The standard applies to a broad scope of financial instruments, including financial assets measured at amortized cost and off-balance sheet credit exposures not accounted for as insurance, such as financial guarantees and other unfunded loan commitments. ASU 2016-13 is effective for fiscal years beginning after December 15, 2019, with early adoption permitted. We are executing an implementation plan, which includes data collection, contract review and assessment, and determination of necessary systems, processes and internal controls. We continue to evaluate ASU 2016-03; based on our current credit portfolio we do not believe adoption of the standard will have a material impact on our financial statements. Reconciliation of Total Cash We define total cash as cash, cash equivalents and restricted cash. Our restricted cash is included in other current assets in our consolidated balance sheets. The following table provides a reconciliation of total cash: Nine Months Ended September 30, (in thousands) 2019 2018 Cash and Cash Equivalents at Beginning of Period $ 10,740 $ 18,026 Restricted Cash at Beginning of Period (1) (2) 951 37,505 Cash, Cash Equivalents, and Restricted Cash at Beginning of Period $ 11,691 $ 55,531 Cash and Cash Equivalents at End of Period $ 17,571 $ 18,201 Restricted Cash at End of Period (1) 50 951 Cash, Cash Equivalents, and Restricted Cash at End of Period $ 17,621 $ 19,152 (1) Restricted cash represents the amount held as collateral at December 31, 2018 and September 30, 2019 for certain of our letters of credit. (2) Restricted cash represents the amount held in escrow at December 31, 2017 for the Black Diamond Acquisition. Revenue Recognition We recognize revenue at an amount that reflects the consideration to which we expect to be entitled in exchange for transferring goods or services to a customer, using a five-step process, in accordance with ASC 606 – Revenue from Contracts with Customers (ASC 606). Under ASC 606, remaining performance obligations represent the transaction price allocated to performance obligations that are unsatisfied as of September 30, 2019 . A certain fresh water delivery affiliate revenue agreement contains a minimum volume commitment for the delivery of fresh water for a fixed fee per barrel with annual percentage escalations. The following table includes estimated revenues, as of September 30, 2019 , for the agreement. Our actual volumes delivered may exceed the future minimum volume commitment. (in thousands) Midstream Services — Affiliate Remainder of 2019 $ 7,616 2020 36,817 2021 37,635 Total $ 82,068 |
Acquisition
Acquisition | 9 Months Ended |
Sep. 30, 2019 | |
Business Combinations [Abstract] | |
Acquisition | Note 3. Acquisition On January 31, 2018, Black Diamond completed the Black Diamond Acquisition for approximately $638.5 million in cash. Noble Member and Greenfield Member each funded its share of the purchase price, approximately $319.9 million and $318.6 million , respectively, through contributions to Black Diamond. Noble Member funded its share of the purchase price through a combination of cash on hand and borrowings under its revolving credit facility. See Note 6. Debt . In addition to the payment to the Seller, Black Diamond, through an additional contribution from Greenfield Member, paid PDC Energy, Inc. (PDC Energy) approximately $24.1 million to expand PDC Energy’s acreage dedication as well as extend the duration of the acreage dedication by five years . In accordance with the limited liability company agreement of Black Diamond, Noble Member received a 54.4% equity ownership interest in Black Diamond and Greenfield Member received a 45.6% equity ownership interest in Black Diamond. Noble Member’s agreed equity ownership interest included a 4.4% equity ownership interest promote which was designed to vest only after Noble Member was allocated an amount of gross revenue equal to the contributions by Greenfield Member in excess of its agreed equity ownership interest. As of September 30, 2019, Noble Member has received the necessary allocations of gross revenue and the equity ownership interest promote has vested. See Note 2. Basis of Presentation . We serve as the operator of the Black Diamond system. We acquired a large-scale integrated gathering system located in the DJ Basin with approximately 160 miles of pipeline in operation and delivery capacity of approximately 300 MBbl/d as well as approximately 141,000 dedicated acres from six customers under fixed-fee arrangements. Purchase Price Allocation The transaction has been accounted for as a business combination, using the acquisition method. The following table represents the final allocation of the total Black Diamond Acquisition purchase price to the assets acquired and the liabilities assumed based on the fair value at the acquisition date, with any excess of the purchase price over the estimated fair value of the identifiable net assets acquired recorded as goodwill. The following table sets forth our final purchase price allocation: (in thousands) Cash Consideration $ 638,266 PDC Energy Payment 24,120 Current Liabilities Assumed 18,259 Total Purchase Price and Liabilities Assumed $ 680,645 Cash and Restricted Cash $ 12,518 Accounts Receivable 10,661 Other Current Assets 2,206 Property, Plant and Equipment 205,766 Intangible Assets (1) 339,760 Fair Value of Identifiable Assets 570,911 Implied Goodwill (2) 109,734 Total Asset Value $ 680,645 (1) The customer contracts we acquired are long-term, fixed-fee contracts for the purchase and sale of crude oil. Fair value was calculated using the multi-period excess earnings method under the income approach for the existing customers. The fair value was determined using unobservable inputs and is considered to be a Level 3 measurement on the fair value hierarchy. (2) Based upon the final purchase price allocation, we have recognized $109.7 million of goodwill, all of which is assigned to the Black Diamond reporting unit within the Gathering Systems reportable segment. As a result of the acquisition, we expect to realize certain synergies which may result from our operation of the Black Diamond system. Pro Forma Results The following pro forma consolidated financial information was derived from the historical financial statements of the Partnership and Saddle Butte and gives effect to the acquisition as if it had occurred on January 1, 2018. The pro forma results of operations do not include any cost savings or other synergies that may result from the Black Diamond Acquisition or any estimated costs that have been or will be incurred by us to integrate the acquired assets. The pro forma consolidated financial information has been included for comparative purposes and is not necessarily indicative of the results that might have actually occurred had the acquisition taken place on January 1, 2018; furthermore, the financial information is not intended to be a projection of future results. Three Months Ended September 30, Nine Months Ended September 30, (in thousands, except per unit amounts) 2019 (1) 2018 (1) 2019 (1) 2018 Revenues $ 169,323 $ 139,163 $ 475,544 $ 369,379 Net Income 66,383 48,703 182,836 129,796 Net Income Attributable to Noble Midstream Partners LP 40,632 44,617 120,600 118,896 Net Income Attributable to Limited Partners Per Limited Partner Unit — Basic Common Units $ 0.88 $ 1.09 $ 2.65 $ 2.92 Subordinated Units $ — $ 1.09 $ 2.89 $ 2.92 Net Income Attributable to Limited Partners Per Limited Partner Unit — Diluted Common Units $ 0.88 $ 1.09 $ 2.64 $ 2.92 Subordinated Units $ — $ 1.09 $ 2.89 $ 2.92 (1) No pro forma adjustments were made for the period as Black Diamond operations are included in our results for the full period. |
Transactions with Affiliates
Transactions with Affiliates | 9 Months Ended |
Sep. 30, 2019 | |
Related Party Transactions [Abstract] | |
Transactions with Affiliates | Note 4. Transactions with Affiliates Revenues We derive a substantial portion of our revenues from commercial agreements with Noble. Revenues generated from commercial agreements with Noble and its affiliates consist of the following: Three Months Ended September 30, Nine Months Ended September 30, (in thousands) 2019 2018 2019 2018 Crude Oil, Natural Gas and Produced Water Gathering $ 79,208 $ 54,674 $ 209,530 $ 144,569 Fresh Water Delivery 20,847 17,416 66,801 56,774 Other 791 1,046 2,393 2,980 Total Midstream Services — Affiliate $ 100,846 $ 73,136 $ 278,724 $ 204,323 Expenses General and administrative expense consists of the following: Three Months Ended September 30, Nine Months Ended September 30, (in thousands) 2019 2018 2019 2018 General and Administrative Expense — Affiliate $ 1,805 $ 1,894 $ 5,601 $ 5,599 General and Administrative Expense — Third Party 2,324 2,310 7,389 14,027 Total General and Administrative Expense $ 4,129 $ 4,204 $ 12,990 $ 19,626 |
Property, Plant and Equipment
Property, Plant and Equipment | 9 Months Ended |
Sep. 30, 2019 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment | Note 5. Property, Plant and Equipment Property, plant and equipment, at cost, is as follows: (in thousands) September 30, 2019 December 31, 2018 Crude Oil, Natural Gas and Produced Water Gathering Systems and Facilities $ 1,403,678 $ 1,199,679 Fresh Water Delivery Systems 80,840 78,820 Crude Oil Treating Facilities 23,140 20,027 Construction-in-Progress (1) 175,162 202,083 Total Property, Plant and Equipment, at Cost 1,682,820 1,500,609 Accumulated Depreciation and Amortization (114,789 ) (79,357 ) Property, Plant and Equipment, Net $ 1,568,031 $ 1,421,252 (1) Construction-in-Progress at September 30, 2019 primarily includes $146.7 million in gathering system projects, $8.3 million in fresh water delivery system projects and $18.8 million in equipment for use in future projects. Construction-in-Progress at December 31, 2018 primarily includes $147.1 million in gathering system projects, $21.6 million in fresh water delivery system projects and $32.8 million in equipment for use in future projects. |
Debt
Debt | 9 Months Ended |
Sep. 30, 2019 | |
Debt Disclosure [Abstract] | |
Debt | Note 6. Debt Debt consists of the following: September 30, 2019 December 31, 2018 (in thousands, except percentages) Debt Interest Rate Debt Interest Rate Revolving Credit Facility, due March 9, 2023 $ 50,000 3.45 % $ 60,000 3.67 % 2018 Term Loan Credit Facility, due July 31, 2021 500,000 3.17 % 500,000 3.42 % 2019 Term Loan Credit Facility, due August 23, 2022 400,000 3.05 % — — % Finance Lease Obligation (1) 2,082 — % 3,231 — % Total 952,082 563,231 Term Loan Credit Facility Unamortized Debt Issuance Costs (1,432 ) (979 ) Total Debt 950,650 562,252 Finance Lease Obligation Due Within One Year (1) (1,743 ) (3,231 ) Long-Term Debt $ 948,907 $ 559,021 (1) See Note 9. Leases . 2019 Term Loan Credit Facility On August 23, 2019, we entered into a three-year senior unsecured term loan credit facility that permits aggregate borrowings of up to $400 million . Proceeds from the term loan were primarily used to repay a portion of the outstanding borrowings under our revolving credit facility and pay fees and expenses in connection with the term loan credit facility. We incurred approximately $0.6 million of fees and expenses. The term loan credit facility contains usual and customary representations and warranties, affirmative and negative covenants, and events of default that are substantially the same as those contained in our revolving credit facility and the 2018 term loan credit facility. Upon the occurrence and during the continuation of an event of default under the term loan credit facility the lenders may declare all amounts outstanding under the term loan credit facility to be immediately due and payable and exercise other remedies as provided by applicable law. Compliance with Covenants The revolving credit facility and term loan credit facilities require us to comply with certain financial covenants as of the end of each fiscal quarter. We were in compliance with such covenants as of September 30, 2019 . Fair Value of Long-Term Debt Our revolving credit facility and term loan credit facilities are variable-rate, non-public debt. The fair value of our revolving credit facility and term loan credit facilities approximates the carrying amount. The fair value is estimated based on observable inputs. As such, we consider the fair value of these facilities to be a Level 2 measurement on the fair value hierarchy. |
Investments
Investments | 9 Months Ended |
Sep. 30, 2019 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Investments | Note 7. Investments We have ownership interests in the following entities: • 3.33% interest in White Cliffs; • 50% interest in the Advantage Joint Venture; • 50% interest in the Delaware Crossing Joint Venture; • 15% interest in EPIC Y-Grade; and • 30% interest in EPIC Crude. Delaware Crossing Joint Venture On February 7, 2019, we executed definitive agreements with Salt Creek Midstream LLC (Salt Creek) and completed the formation of the Delaware Crossing Joint Venture to construct a crude oil pipeline system with a capacity of 160 MBbl/d in the Delaware Basin. During the first nine months of 2019, we have made capital contributions of approximately $51.5 million . EPIC Y-Grade On January 31, 2019, we exercised and closed our option with EPIC Midstream Holdings, LP (EPIC) to acquire an interest in EPIC Y-Grade. EPIC Y-Grade is constructing an approximately 700-mile pipeline linking natural gas liquid (NGL) reserves in the Permian Basin and Eagle Ford Shale to Gulf Coast refiners, petrochemical companies, and export markets. During the first nine months of 2019, we have made capital contributions of approximately $166.1 million . EPIC Crude On January 31, 2019, we exercised our option to acquire an interest in EPIC Crude. On March 8, 2019, we closed our option with EPIC to acquire the interest in EPIC Crude. EPIC Crude is constructing an approximately 700-mile pipeline with a capacity of 590 MBbl/d from the Delaware Basin to the Gulf Coast. During the first nine months of 2019, we have made capital contributions of approximately $268.7 million . The following table presents our investments at the dates indicated: (in thousands) September 30, 2019 December 31, 2018 White Cliffs $ 10,274 $ 9,373 Advantage Joint Venture 74,711 72,944 Delaware Crossing Joint Venture 50,435 — EPIC Y-Grade 166,491 — EPIC Crude 263,476 — Total Investments $ 565,387 $ 82,317 The following table presents our investment loss (income) for the periods indicated: Three Months Ended September 30, Nine Months Ended September 30, (in thousands) 2019 2018 2019 2018 White Cliffs $ (716 ) $ (912 ) $ (2,605 ) $ (2,716 ) Advantage Joint Venture (1,867 ) (2,772 ) (5,621 ) (7,569 ) Delaware Crossing Joint Venture 512 — 2,050 — EPIC Y-Grade 2,000 — 3,054 — EPIC Crude 6,130 — 9,375 — Other (1) (438 ) (182 ) (1,225 ) (540 ) Total Investment Loss (Income) $ 5,621 $ (3,866 ) $ 5,028 $ (10,825 ) (1) Represents income associated with our fee for serving as the operator of the Advantage Joint Venture and Delaware Crossing Joint Venture. |
Segment Information
Segment Information | 9 Months Ended |
Sep. 30, 2019 | |
Segment Reporting [Abstract] | |
Segment Information | Note 8. Segment Information We manage our operations by the nature of the services we offer. Our reportable segments comprise the structure used to make key operating decisions and assess performance. As a result of our increased investment in midstream entities during first quarter 2019, we have established an Investments in Midstream Entities reportable segment. Our Investments in Midstream Entities reportable segment includes all activity associated with our unconsolidated investments. See Note 7. Investments . We are now organized into the following reportable segments: Gathering Systems (crude oil, natural gas, and produced water gathering, crude oil treating, and crude oil sales), Fresh Water Delivery, Investments in Midstream Entities and Corporate. We often refer to the services of our Gathering Systems and Fresh Water Delivery reportable segments collectively as our midstream services. Prior period segment information has been reclassified to conform to the current period presentation. Summarized financial information concerning our reportable segments is as follows: (in thousands) Gathering Systems (1) Fresh Water Delivery (1) Investments in Midstream Entities Corporate (2) Consolidated Three Months Ended September 30, 2019 Midstream Services — Affiliate $ 79,999 $ 20,847 $ — $ — $ 100,846 Midstream Services — Third Party 17,475 2,132 — — 19,607 Crude Oil Sales — Third Party 48,870 — — — 48,870 Total Revenues 146,344 22,979 — — 169,323 Income (Loss) Before Income Taxes 61,952 18,825 (5,621 ) (8,681 ) 66,475 Additions to Long-Lived Assets 56,781 4,646 — 299 61,726 Additions to Investments — — 86,757 — 86,757 Three Months Ended September 30, 2018 Midstream Services — Affiliate $ 55,720 $ 17,416 $ — $ — $ 73,136 Midstream Services — Third Party 14,005 5,929 — — 19,934 Crude Oil Sales — Third Party 46,093 — — — 46,093 Total Revenues 115,818 23,345 — — 139,163 Income (Loss) Before Income Taxes 34,780 18,129 3,866 (8,166 ) 48,609 Additions to Long-Lived Assets 72,948 6,159 — — 79,107 Additions to Investments — — 307 — 307 Nine Months Ended September 30, 2019 Midstream Services — Affiliate $ 211,923 $ 66,801 $ — $ — $ 278,724 Midstream Services — Third Party 54,903 8,395 — — 63,298 Crude Oil Sales — Third Party 133,522 — — — 133,522 Total Revenues 400,348 75,196 — — 475,544 Income (Loss) Before Income Taxes 158,671 55,655 (5,028 ) (26,172 ) 183,126 Additions to Long-Lived Assets 187,437 6,040 — 810 194,287 Additions to Investments — — 501,344 — 501,344 Nine Months Ended September 30, 2018 Midstream Services — Affiliate $ 147,549 $ 56,774 $ — $ — $ 204,323 Midstream Services — Third Party 31,831 12,932 — — 44,763 Crude Oil Sales — Third Party 109,781 — — — 109,781 Total Revenues 289,161 69,706 — — 358,867 Income (Loss) Before Income Taxes 94,674 54,066 10,825 (27,121 ) 132,444 Additions to Long-Lived Assets 669,908 18,711 — — 688,619 Additions to Investments — — 426 — 426 September 30, 2019 Total Assets $ 1,953,417 $ 87,100 $ 565,387 $ 16,862 $ 2,622,766 December 31, 2018 Total Assets $ 1,804,100 $ 96,280 $ 82,317 $ 15,220 $ 1,997,917 (1) A substantial portion of the financial statement activity associated with our DevCos is captured within the Gathering Systems and Fresh Water Delivery reportable segments. Although our unconsolidated investments are owned through certain DevCos, all financial statement activity associated with our unconsolidated investments is captured within the Investments in Midstream Entities reportable segment. As our DevCos represent VIEs, see the above reportable segments for our VIEs impact to the consolidated financial statements. (2) The Corporate segment includes all general Partnership activity not attributable to our DevCos. |
Leases
Leases | 9 Months Ended |
Sep. 30, 2019 | |
Leases [Abstract] | |
Leases | Note 9. Leases In the normal course of business, we enter into lease agreements to support our operations. We lease field equipment as well as water and pipeline transportation assets. Operating Leases Our operating leases consist of field equipment and transportation assets. Our field equipment leases have fixed monthly payments over a minimum term with options to extend the rental period on a month-to-month basis. Our leased transportation assets have variable monthly payments (price per barrel throughput) over a minimum term with the option to extend on a year-to-year basis. Our operating and variable lease expense is recorded in direct operating expense in our consolidated statement of operations and was de minimis for the three and nine months ended September 30, 2019 . Finance Leases We lease water assets for use in the performance of our fresh water delivery services. The amount of the lease obligation is based on the discounted present value of future minimum lease payments, and therefore does not reflect future cash lease payments. Our finance lease expense is recorded in depreciation and amortization expense in our consolidated statement of operations and was de minimis for the three and nine months ended September 30, 2019 . Interest expense for our finance lease is recorded in interest expense in our consolidated statement of operations and was de minimis for the three and nine months ended September 30, 2019 . Short Term Leases Leases with an initial term of 12 months or less are not recorded on the balance sheet; we recognize lease expense for these leases on a straight-line basis over the lease term. Short term lease expense is recorded in direct operating expense in our consolidated statement of operations and was de minimis for the three and nine months ended September 30, 2019 . Balance Sheet Information ROU assets and lease liabilities are as follows: (thousands) Balance Sheet Location September 30, 2019 Assets Operating (1) Other Noncurrent Assets $ 3,303 Finance (2) Total Property, Plant and Equipment, Net 3,958 Total ROU Assets $ 7,261 Liabilities Current Operating Other Current Liabilities $ 2,621 Finance Other Current Liabilities 1,743 Noncurrent Operating Other Noncurrent Liabilities 667 Finance (3) Long-Term Debt 339 Total Lease Liabilities $ 5,370 (1) All of our operating leases mature between 2019 through 2021. Future operating lease payments of $0.7 million are due in 2019, $2.5 million are due in 2020 and $0.2 million are due in 2021. (2) Finance lease assets are recorded net of accumulated amortization of $1.0 million as of September 30, 2019 . (3) Our finance lease matures during 2021. |
Leases | Note 9. Leases In the normal course of business, we enter into lease agreements to support our operations. We lease field equipment as well as water and pipeline transportation assets. Operating Leases Our operating leases consist of field equipment and transportation assets. Our field equipment leases have fixed monthly payments over a minimum term with options to extend the rental period on a month-to-month basis. Our leased transportation assets have variable monthly payments (price per barrel throughput) over a minimum term with the option to extend on a year-to-year basis. Our operating and variable lease expense is recorded in direct operating expense in our consolidated statement of operations and was de minimis for the three and nine months ended September 30, 2019 . Finance Leases We lease water assets for use in the performance of our fresh water delivery services. The amount of the lease obligation is based on the discounted present value of future minimum lease payments, and therefore does not reflect future cash lease payments. Our finance lease expense is recorded in depreciation and amortization expense in our consolidated statement of operations and was de minimis for the three and nine months ended September 30, 2019 . Interest expense for our finance lease is recorded in interest expense in our consolidated statement of operations and was de minimis for the three and nine months ended September 30, 2019 . Short Term Leases Leases with an initial term of 12 months or less are not recorded on the balance sheet; we recognize lease expense for these leases on a straight-line basis over the lease term. Short term lease expense is recorded in direct operating expense in our consolidated statement of operations and was de minimis for the three and nine months ended September 30, 2019 . Balance Sheet Information ROU assets and lease liabilities are as follows: (thousands) Balance Sheet Location September 30, 2019 Assets Operating (1) Other Noncurrent Assets $ 3,303 Finance (2) Total Property, Plant and Equipment, Net 3,958 Total ROU Assets $ 7,261 Liabilities Current Operating Other Current Liabilities $ 2,621 Finance Other Current Liabilities 1,743 Noncurrent Operating Other Noncurrent Liabilities 667 Finance (3) Long-Term Debt 339 Total Lease Liabilities $ 5,370 (1) All of our operating leases mature between 2019 through 2021. Future operating lease payments of $0.7 million are due in 2019, $2.5 million are due in 2020 and $0.2 million are due in 2021. (2) Finance lease assets are recorded net of accumulated amortization of $1.0 million as of September 30, 2019 . (3) Our finance lease matures during 2021. |
Partnership Distributions
Partnership Distributions | 9 Months Ended |
Sep. 30, 2019 | |
Equity [Abstract] | |
Partnership Distributions | Note 10. Partnership Distributions Our partnership agreement requires that, within 45 days after the end of each quarter, we distribute all of our available cash to unitholders of record on the applicable record date. The following table details the distributions paid in respect of the periods presented below: Distributions (in thousands) Limited Partners Period Record Date Distribution Date Distribution per Limited Partner Unit Common Unitholders (1) Subordinated Unitholders Holder of IDRs Total Q4 2017 February 5, 2018 February 12, 2018 $ 0.4883 $ 11,566 $ 7,765 $ 520 $ 19,851 Q1 2018 May 7, 2018 May 14, 2018 $ 0.5110 $ 12,103 $ 8,126 $ 819 $ 21,048 Q2 2018 August 6, 2018 August 13, 2018 $ 0.5348 $ 12,668 $ 8,504 $ 1,134 $ 22,306 Q4 2018 February 4, 2019 February 11, 2019 $ 0.5858 $ 13,876 $ 9,316 $ 2,421 $ 25,613 Q1 2019 May 6, 2019 May 13, 2019 $ 0.6132 $ 14,534 $ 9,751 $ 3,507 $ 27,792 Q2 2019 August 5, 2019 August 12, 2019 $ 0.6418 $ 25,418 $ — $ 4,640 $ 30,058 (1) Distributions to common unitholders does not include distribution equivalent rights on units that vested under the Noble Midstream Partners LP 2016 Long-Term Incentive Plan (the LTIP). Incentive Distribution Rights Noble currently holds Incentive Distribution Rights (IDRs) that entitle it to receive increasing percentages, up to a maximum of 50% , of the available cash we distribute from operating surplus in excess of $0.4313 per unit per quarter. The maximum distribution of 50% does not include any distributions that Noble may receive on Common Units or Subordinated Units that it owns. Conversion of Subordinated Units On April 25, 2019, the board of directors of our general partner declared a quarterly cash distribution of $0.6132 per unit f or the quarter ended March 31, 2019. The distribution was paid on May 13, 2019 to unitholders of record as of the close of business on May 6, 2019. Upon payment of the distribution, the requirements for the conversion of all Subordinated Units were satisfied under our partnership agreement. As a result, on May 14, 2019, all 15,902,584 Subordinated Units, which were owned entirely by Noble, converted into Common Units on a one-for-one basis and thereafter will participate on terms equal with all other Common Units in distributions from available cash. Cash Distributions On October 24, 2019, the board of directors of our general partner declared a quarterly cash distribution of $0.6716 per unit. The distribution will be paid on November 11, 2019, to unitholders of record as of November 4, 2019. Also on November 11, 2019, a cash incentive distribution of $5.8 million will be made to Noble related to its IDRs, based upon the level of distribution paid per Common Unit. |
Net Income Per Limited Partner
Net Income Per Limited Partner Unit | 9 Months Ended |
Sep. 30, 2019 | |
Earnings Per Share [Abstract] | |
Net Income Per Limited Partner Unit | Note 11. Net Income Per Limited Partner Unit Our net income is attributed to limited partners, in accordance with their respective ownership percentages, and when applicable, giving effect to incentive distributions paid to Noble, the holder of our IDRs. The Common and Subordinated unitholders represent an aggregate 100% limited partner interest in us. Pursuant to our partnership agreement, to the extent that the quarterly distributions exceed certain target levels, Noble, as the holder of our IDRs, is entitled to receive certain incentive distributions that will result in more net income proportionately being allocated to Noble than to the holders of Common Units and Subordinated Units. Because we have more than one class of participating securities, we use the two-class method when calculating the net income per unit applicable to limited partners. The classes of participating securities include Common Units, Subordinated Units and IDRs. Basic and diluted net income per limited partner Common Unit and Subordinated Unit is computed by dividing the respective limited partners’ interest in net income for the period by the weighted-average number of Common Units and Subordinated Units outstanding for the period. Diluted net income per limited partner Common Unit and Subordinated Unit reflects the potential dilution that could occur if agreements to issue Common Units, such as awards under the LTIP, were settled or converted into Common Units. When it is determined that potential Common Units resulting from an award should be included in the diluted net income per limited partner Common and Subordinated Unit calculation, the impact is reflected by applying the treasury stock method. See Note 10. Partnership Distributions for further discussion of the conversion of Subordinated Units on May 14, 2019. Our calculation of net income per limited partner Common and Subordinated Unit is as follows: Three Months Ended September 30, Nine Months Ended September 30, (in thousands, except per unit amounts) 2019 2018 2019 2018 Net Income Attributable to Noble Midstream Partners LP $ 40,632 $ 44,617 $ 120,600 $ 120,562 Less: Net Income Attributable to Incentive Distribution Rights 5,820 1,462 13,967 3,415 Net Income Attributable to Limited Partners $ 34,812 $ 43,155 $ 106,633 $ 117,147 Net Income Attributable to Common Units $ 34,812 $ 25,825 $ 84,266 $ 70,093 Net Income Attributable to Subordinated Units — 17,330 22,367 47,054 Net Income Attributable to Limited Partners $ 34,812 $ 43,155 $ 106,633 $ 117,147 Net Income Attributable to Limited Partners Per Limited Partner Unit — Basic Common Units $ 0.88 $ 1.09 $ 2.65 $ 2.96 Subordinated Units $ — $ 1.09 $ 2.89 $ 2.96 Net Income Attributable to Limited Partners Per Limited Partner Unit — Diluted Common Units $ 0.88 $ 1.09 $ 2.64 $ 2.96 Subordinated Units $ — $ 1.09 $ 2.89 $ 2.96 Weighted Average Limited Partner Units Outstanding — Basic Common Units 39,604 23,688 31,855 23,686 Subordinated Units — 15,903 7,747 15,903 Weighted Average Limited Partner Units Outstanding — Diluted Common Units 39,624 23,704 31,879 23,701 Subordinated Units — 15,903 7,747 15,903 Antidilutive Restricted Units 44 21 66 22 |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 12. Commitments and Contingencies We may become involved in various legal proceedings in the ordinary course of business. These proceedings would be subject to the uncertainties inherent in any litigation, and we will regularly assess the need for accounting recognition or disclosure of these contingencies. We would expect to defend ourselves vigorously in all such matters. Based on currently available information, we believe it is unlikely that the outcome of known matters would have a material adverse impact on our combined financial condition, results of operations or cash flows. |
Basis of Presentation (Policies
Basis of Presentation (Policies) | 9 Months Ended |
Sep. 30, 2019 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Consolidation | Basis of Presentation and Consolidation The accompanying unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (U.S. GAAP) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and notes required by U.S. GAAP for complete financial statements. The accompanying consolidated financial statements at September 30, 2019 and December 31, 2018 and for the three and nine months ended September 30, 2019 and 2018 contain all normally recurring adjustments considered necessary for a fair presentation of our financial position, results of operations, cash flows and equity for such periods. In Note 8. Segment Information , we report a new Investments in Midstream Entities reportable segment and present prior period amounts on a comparable basis. Prior period segment information has been reclassified to conform to the current period presentation. Operating results for the three and nine months ended September 30, 2019 are not necessarily indicative of the results that may be expected for the year ending December 31, 2019 . We have no items of other comprehensive income; therefore, our net income is identical to our comprehensive income. |
Consolidated Variable Interest Entities | Variable Interest Entities Our consolidated financial statements include our accounts and the accounts of the DevCos, each of which we control as general partner. All intercompany balances and transactions have been eliminated upon consolidation. We have determined that the partners with equity at risk in each of the DevCos lack the authority, through voting rights or similar rights, to direct the activities that most significantly impact their economic performance; therefore, each DevCo is considered a variable interest entity, or VIE. Through our 100% ownership interest in Noble Midstream Services, LLC, a Delaware limited liability company which owns controlling interests in each of the DevCos, we have the authority to direct the activities that most significantly affect economic performance and the obligation to absorb losses or the right to receive benefits that could be potentially significant to us. Therefore, we are considered the primary beneficiary and consolidate each of the DevCos in our financial statements. A substantial portion of the financial statement activity associated with our DevCos is captured within the Gathering Systems and Fresh Water Delivery reportable segments. Although our unconsolidated investments are owned through certain DevCos, all financial statement activity associated with our unconsolidated investments are captured within the Investments in Midstream Entities reportable segment. See Note 7. Investments and Note 8. Segment Information . On January 31, 2018, Black Diamond, an entity formed by Black Diamond Gathering Holdings LLC (the Noble Member), a wholly-owned subsidiary of Noble Midstream Partners LP, and Greenfield Midstream, LLC (the Greenfield Member), completed the acquisition of all of the issued and outstanding limited liability company interests in Saddle Butte Rockies Midstream, LLC and certain affiliates (collectively, Saddle Butte) from Saddle Butte Pipeline II, LLC (Seller). The acquisition of Saddle Butte will be referred to as the Black Diamond Acquisition. See Note 3. Acquisition . Our consolidated financial statements include the accounts of Black Diamond, which we control. We have determined that the partners with equity at risk in Black Diamond lack the authority, through voting rights or similar rights, to direct the activities that most significantly impact their economic performance. Therefore, Black Diamond is considered a VIE. Through our majority representation on the Black Diamond company board of directors as well as our responsibility as operator of the acquired system, we have the authority to direct the activities that most significantly affect economic performance and the obligation to absorb losses or the right to receive benefits that could be potentially significant to us. Therefore, we are considered the primary beneficiary and consolidate Black Diamond in our financial statements. Black Diamond Equity Ownership Promote Vesting In accordance with the limited liability company agreement of Black Diamond, Noble Member received an equity ownership promote. The limited liability company agreement of Black Diamond required special allocations of gross income to balance the ratio of each member’s capital account to its agreed equity ownership interest over time. The special allocations were accounted for as equity transactions between the Partnership and a subsidiary with no gain or loss recognized. As of September 30, 2019 , each member’s capital account agreed to its equity ownership interest and no further special allocations are required. See Note 3. Acquisition . |
Noncontrolling Interests | Noncontrolling Interests We present our consolidated financial statements with a noncontrolling interest section representing Noble’s retained ownership of our DevCos as well as Greenfield Member’s ownership of Black Diamond. Redeemable Noncontrolling Interest On March 25, 2019, we, through Dos Rios Crude Intermediate LLC, a wholly-owned subsidiary of Dos Rios DevCo LLC, secured a $200 million equity commitment from GIP CAPS Dos Rios Holding Partnership, L.P. (GIP). Upon securing the equity commitment, we issued 100,000 preferred units, with a face value of $1,000 per preferred unit (Preferred Equity). Proceeds from the Preferred Equity totaled $100 million and we incurred offering costs of $3.4 million . The remaining $100 million equity commitment is available for a one-year period, subject to certain conditions precedent. Proceeds from the Preferred Equity were utilized to repay a portion of outstanding borrowings under our revolving credit facility. See Note 6. Debt . We can redeem the Preferred Equity in whole or in part at any time for cash at a predetermined redemption price. The predetermined redemption price is based on the greater of a defined internal rate of return or the multiple on invested capital. GIP can request redemption of the Preferred Equity following the later of the sixth anniversary of the Preferred Equity closing or the fifth anniversary of the EPIC Crude pipeline completion date at a pre-determined base return. As GIP’s redemption right is outside of our control, the Preferred Equity is not considered to be a component of equity on the consolidated balance sheet, and such Preferred Equity is reported as mezzanine equity on the consolidated balance sheet. In addition, because the Preferred Equity was issued by a subsidiary of the Partnership and is held by a third party, it is considered a redeemable noncontrolling interest. The Preferred Equity was recorded initially at fair value on the issuance date. Subsequent to issuance, we accrete changes in the redemption value of the Preferred Equity from the date of issuance to GIP’s earliest redemption date of the Preferred Equity. The Preferred Equity is perpetual and has a 6.5% |
Equity Method of Accounting | We use the equity method of accounting for our investments in the Advantage Joint Venture, the Delaware Crossing Joint Venture, EPIC Y-Grade and EPIC Crude, as we do not control, but do exert significant influence over their operations. |
Cost Method of Accounting | We use the cost method of accounting for our investment in White Cliffs Pipeline L.L.C. (White Cliffs) as we have virtually no influence over its operations and financial policies. |
Leases | Leases We determine whether an arrangement contains a lease based on the conveyed rights and obligations at the inception date. If an agreement contains a lease, at the commencement date, we record a right-of-use (ROU) asset and a corresponding lease liability based on the present value of lease payments over the lease term. As most of our leases do not provide an implicit rate to determine the present value of lease payments, we use our hypothetical secured borrowing rate based on information available at lease commencement. The weighted average discount rate is 3.69% for operating leases and 2.80% for our finance lease. Leases with an initial term of 12 months or less are not recorded on the balance sheet and we recognize lease expense for these leases on a straight-line basis over the lease term. Most leases include one or more options to renew, with renewal terms that can extend the lease term from one month to one year or more. Additionally, some of our leases include an option for early termination. We include renewal periods and exclude termination periods from our lease term if, at commencement, it is reasonably likely that we will exercise the option. |
Use of Estimates | Use of Estimates The preparation of consolidated financial statements in conformity with U.S. GAAP requires us to make a number of estimates and assumptions relating to the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ significantly from those estimates. Management evaluates estimates and assumptions on an ongoing basis using historical experience and other factors, including the current economic and commodity price environment. |
Intangible Assets | Intangible Assets Our intangible asset accumulated amortization totaled approximately $53.7 million and $29.6 million as of September 30, 2019 and December 31, 2018, respectively. Intangible asset amortization expense totaled approximately $8.1 million for the three months ended September 30, 2019 and 2018 and $24.2 million and $21.4 million for the nine months ended September 30, 2019 and 2018, respectively. The weighted average amortization period for our intangible assets is approximately 11 years . |
Recently Adopted and Recently Issued Accounting Standards | Recently Adopted Accounting Standards Leases In February 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update No. 2016-02 (ASU 2016-02), which creates Topic 842 – Leases (ASC 842). The standard requires lessees to recognize a ROU asset and lease liability on the balance sheet for the rights and obligations created by leases. ASC 842 also requires disclosures designed to give financial statement users information on the amount, timing, and uncertainty of cash flows arising from leases. The new standard provided a number of optional practical expedients. We elected: • the package of ‘practical expedients’, permitting us not to reassess our prior conclusions about lease identification, lease classification and initial direct costs; • the practical expedient pertaining to land easements, allowing us to account for existing land easements under previous accounting policy; and • the practical expedient to not separate lease and non-lease components for the majority of our leases. We adopted ASC 842 on January 1, 2019 using the modified retrospective approach. The standard did not materially impact our consolidated balance sheet or consolidated statement of operations and had no impact on our consolidated statement of cash flows. Prior period financial statements were not adjusted. See Note 9. Leases . Recently Issued Accounting Standards Financial Instruments: Credit Losses In June 2016, the FASB issued Accounting Standards Update No. 2016-13 (ASU 2016-13): Financial Instruments – Credit Losses , which replaces the incurred loss impairment methodology with a methodology that reflects current expected credit losses. The standard applies to a broad scope of financial instruments, including financial assets measured at amortized cost and off-balance sheet credit exposures not accounted for as insurance, such as financial guarantees and other unfunded loan commitments. ASU 2016-13 is effective for fiscal years beginning after December 15, 2019, with early adoption permitted. We are executing an implementation plan, which includes data collection, contract review and assessment, and determination of necessary systems, processes and internal controls. We continue to evaluate ASU 2016-03; based on our current credit portfolio we do not believe adoption of the standard will have a material impact on our financial statements. Reconciliation of Total Cash We define total cash as cash, cash equivalents and restricted cash. Our restricted cash is included in other current assets in our consolidated balance sheets. The following table provides a reconciliation of total cash: Nine Months Ended September 30, (in thousands) 2019 2018 Cash and Cash Equivalents at Beginning of Period $ 10,740 $ 18,026 Restricted Cash at Beginning of Period (1) (2) 951 37,505 Cash, Cash Equivalents, and Restricted Cash at Beginning of Period $ 11,691 $ 55,531 Cash and Cash Equivalents at End of Period $ 17,571 $ 18,201 Restricted Cash at End of Period (1) 50 951 Cash, Cash Equivalents, and Restricted Cash at End of Period $ 17,621 $ 19,152 (1) Restricted cash represents the amount held as collateral at December 31, 2018 and September 30, 2019 for certain of our letters of credit. (2) Restricted cash represents the amount held in escrow at December 31, 2017 for the Black Diamond Acquisition. Revenue Recognition We recognize revenue at an amount that reflects the consideration to which we expect to be entitled in exchange for transferring goods or services to a customer, using a five-step process, in accordance with ASC 606 – Revenue from Contracts with Customers (ASC 606). Under ASC 606, remaining performance obligations represent the transaction price allocated to performance obligations that are unsatisfied as of September 30, 2019 . A certain fresh water delivery affiliate revenue agreement contains a minimum volume commitment for the delivery of fresh water for a fixed fee per barrel with annual percentage escalations. The following table includes estimated revenues, as of September 30, 2019 , for the agreement. Our actual volumes delivered may exceed the future minimum volume commitment. (in thousands) Midstream Services — Affiliate Remainder of 2019 $ 7,616 2020 36,817 2021 37,635 Total $ 82,068 |
Revenue Recognition | Revenue Recognition We recognize revenue at an amount that reflects the consideration to which we expect to be entitled in exchange for transferring goods or services to a customer, using a five-step process, in accordance with ASC 606 – Revenue from Contracts with Customers (ASC 606). Under ASC 606, remaining performance obligations represent the transaction price allocated to performance obligations that are unsatisfied as of September 30, 2019 . A certain fresh water delivery affiliate revenue agreement contains a minimum volume commitment for the delivery of fresh water for a fixed fee per barrel with annual percentage escalations. The following table includes estimated revenues, as of September 30, 2019 , for the agreement. Our actual volumes delivered may exceed the future minimum volume commitment. (in thousands) Midstream Services — Affiliate Remainder of 2019 $ 7,616 2020 36,817 2021 37,635 Total $ 82,068 |
Organization and Nature of Op_2
Organization and Nature of Operations (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Subsidiaries | Our assets consist of ownership interests in certain development companies (DevCos) which serve specific areas and integrated development plan (IDP) areas and consist of the following: DevCo Areas Served NBLX Dedicated Service NBLX Ownership Noncontrolling Interest (1) Colorado River DevCo LP Wells Ranch IDP (DJ Basin) East Pony IDP (DJ Basin) All Noble DJ Basin Acreage Crude Oil Gathering Natural Gas Gathering Water Services Crude Oil Gathering Crude Oil Treating 100% N/A San Juan River DevCo LP East Pony IDP (DJ Basin) Water Services 25% 75% Green River DevCo LP Mustang IDP (DJ Basin) Crude Oil Gathering Natural Gas Gathering Water Services 25% 75% Laramie River DevCo LP Greeley Crescent IDP (DJ Basin) Crude Oil Gathering Water Services 100% N/A Black Diamond Dedication Area (DJ Basin) Crude Oil Gathering Natural Gas Gathering 54.4% 45.6% Blanco River DevCo LP Delaware Basin Crude Oil Gathering Natural Gas Gathering Produced Water Services 40% 60% Gunnison River DevCo LP Bronco IDP (DJ Basin) Crude Oil Gathering Water Services 5% 95% Trinity River DevCo LLC (2) Delaware Basin Crude Oil Transmission Natural Gas Compression 100% N/A Dos Rios DevCo LLC (3) Delaware Basin Crude Oil Transmission Y-Grade Transmission 100% N/A (1) The noncontrolling interest represents Noble’s retained ownership interest in each DevCo. The noncontrolling interest in Black Diamond Gathering LLC (Black Diamond) represents Greenfield Member’s interest in Black Diamond. (2) Our ownership interest in Advantage Pipeline Holdings, L.L.C. (the Advantage Joint Venture) is owned through Trinity River DevCo LLC. See Note 7. Investments . (3) Our ownership interests in Delaware Crossing LLC (the Delaware Crossing Joint Venture), EPIC Y-Grade, LP (EPIC Y-Grade) and EPIC Crude Holdings, LP (EPIC Crude) are owned through wholly-owned subsidiaries of Dos Rios DevCo LLC. See Note 7. Investments |
Basis of Presentation (Tables)
Basis of Presentation (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Accounting Policies [Abstract] | |
Schedule of Cash, Cash Equivalents and Restricted Cash | We define total cash as cash, cash equivalents and restricted cash. Our restricted cash is included in other current assets in our consolidated balance sheets. The following table provides a reconciliation of total cash: Nine Months Ended September 30, (in thousands) 2019 2018 Cash and Cash Equivalents at Beginning of Period $ 10,740 $ 18,026 Restricted Cash at Beginning of Period (1) (2) 951 37,505 Cash, Cash Equivalents, and Restricted Cash at Beginning of Period $ 11,691 $ 55,531 Cash and Cash Equivalents at End of Period $ 17,571 $ 18,201 Restricted Cash at End of Period (1) 50 951 Cash, Cash Equivalents, and Restricted Cash at End of Period $ 17,621 $ 19,152 (1) Restricted cash represents the amount held as collateral at December 31, 2018 and September 30, 2019 for certain of our letters of credit. (2) Restricted cash represents the amount held in escrow at December 31, 2017 for the Black Diamond Acquisition. |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction | The following table includes estimated revenues, as of September 30, 2019 , for the agreement. Our actual volumes delivered may exceed the future minimum volume commitment. (in thousands) Midstream Services — Affiliate Remainder of 2019 $ 7,616 2020 36,817 2021 37,635 Total $ 82,068 |
Acquisition (Tables)
Acquisition (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Business Combinations [Abstract] | |
Schedule of Business Acquisitions, by Acquisition | The following table sets forth our final purchase price allocation: (in thousands) Cash Consideration $ 638,266 PDC Energy Payment 24,120 Current Liabilities Assumed 18,259 Total Purchase Price and Liabilities Assumed $ 680,645 Cash and Restricted Cash $ 12,518 Accounts Receivable 10,661 Other Current Assets 2,206 Property, Plant and Equipment 205,766 Intangible Assets (1) 339,760 Fair Value of Identifiable Assets 570,911 Implied Goodwill (2) 109,734 Total Asset Value $ 680,645 (1) The customer contracts we acquired are long-term, fixed-fee contracts for the purchase and sale of crude oil. Fair value was calculated using the multi-period excess earnings method under the income approach for the existing customers. The fair value was determined using unobservable inputs and is considered to be a Level 3 measurement on the fair value hierarchy. (2) Based upon the final purchase price allocation, we have recognized $109.7 million of goodwill, all of which is assigned to the Black Diamond reporting unit within the Gathering Systems reportable segment. As a result of the acquisition, we expect to realize certain synergies which may result from our operation of the Black Diamond system. |
Business Acquisition, Pro Forma Information | The following pro forma consolidated financial information was derived from the historical financial statements of the Partnership and Saddle Butte and gives effect to the acquisition as if it had occurred on January 1, 2018. The pro forma results of operations do not include any cost savings or other synergies that may result from the Black Diamond Acquisition or any estimated costs that have been or will be incurred by us to integrate the acquired assets. The pro forma consolidated financial information has been included for comparative purposes and is not necessarily indicative of the results that might have actually occurred had the acquisition taken place on January 1, 2018; furthermore, the financial information is not intended to be a projection of future results. Three Months Ended September 30, Nine Months Ended September 30, (in thousands, except per unit amounts) 2019 (1) 2018 (1) 2019 (1) 2018 Revenues $ 169,323 $ 139,163 $ 475,544 $ 369,379 Net Income 66,383 48,703 182,836 129,796 Net Income Attributable to Noble Midstream Partners LP 40,632 44,617 120,600 118,896 Net Income Attributable to Limited Partners Per Limited Partner Unit — Basic Common Units $ 0.88 $ 1.09 $ 2.65 $ 2.92 Subordinated Units $ — $ 1.09 $ 2.89 $ 2.92 Net Income Attributable to Limited Partners Per Limited Partner Unit — Diluted Common Units $ 0.88 $ 1.09 $ 2.64 $ 2.92 Subordinated Units $ — $ 1.09 $ 2.89 $ 2.92 (1) No pro forma adjustments were made for the period as Black Diamond operations are included in our results for the full period. |
Transactions with Affiliates (T
Transactions with Affiliates (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Related Party Transactions [Abstract] | |
Schedule of Related Party Transactions | Revenues generated from commercial agreements with Noble and its affiliates consist of the following: Three Months Ended September 30, Nine Months Ended September 30, (in thousands) 2019 2018 2019 2018 Crude Oil, Natural Gas and Produced Water Gathering $ 79,208 $ 54,674 $ 209,530 $ 144,569 Fresh Water Delivery 20,847 17,416 66,801 56,774 Other 791 1,046 2,393 2,980 Total Midstream Services — Affiliate $ 100,846 $ 73,136 $ 278,724 $ 204,323 |
Schedule of General and Administrative Expenses | General and administrative expense consists of the following: Three Months Ended September 30, Nine Months Ended September 30, (in thousands) 2019 2018 2019 2018 General and Administrative Expense — Affiliate $ 1,805 $ 1,894 $ 5,601 $ 5,599 General and Administrative Expense — Third Party 2,324 2,310 7,389 14,027 Total General and Administrative Expense $ 4,129 $ 4,204 $ 12,990 $ 19,626 |
Property, Plant and Equipment (
Property, Plant and Equipment (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment | Property, plant and equipment, at cost, is as follows: (in thousands) September 30, 2019 December 31, 2018 Crude Oil, Natural Gas and Produced Water Gathering Systems and Facilities $ 1,403,678 $ 1,199,679 Fresh Water Delivery Systems 80,840 78,820 Crude Oil Treating Facilities 23,140 20,027 Construction-in-Progress (1) 175,162 202,083 Total Property, Plant and Equipment, at Cost 1,682,820 1,500,609 Accumulated Depreciation and Amortization (114,789 ) (79,357 ) Property, Plant and Equipment, Net $ 1,568,031 $ 1,421,252 (1) Construction-in-Progress at September 30, 2019 primarily includes $146.7 million in gathering system projects, $8.3 million in fresh water delivery system projects and $18.8 million in equipment for use in future projects. Construction-in-Progress at December 31, 2018 primarily includes $147.1 million in gathering system projects, $21.6 million in fresh water delivery system projects and $32.8 million in equipment for use in future projects. |
Debt (Tables)
Debt (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Debt Instruments | Debt consists of the following: September 30, 2019 December 31, 2018 (in thousands, except percentages) Debt Interest Rate Debt Interest Rate Revolving Credit Facility, due March 9, 2023 $ 50,000 3.45 % $ 60,000 3.67 % 2018 Term Loan Credit Facility, due July 31, 2021 500,000 3.17 % 500,000 3.42 % 2019 Term Loan Credit Facility, due August 23, 2022 400,000 3.05 % — — % Finance Lease Obligation (1) 2,082 — % 3,231 — % Total 952,082 563,231 Term Loan Credit Facility Unamortized Debt Issuance Costs (1,432 ) (979 ) Total Debt 950,650 562,252 Finance Lease Obligation Due Within One Year (1) (1,743 ) (3,231 ) Long-Term Debt $ 948,907 $ 559,021 (1) See Note 9. Leases . |
Investments (Tables)
Investments (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Summary of Investments | The following table presents our investments at the dates indicated: (in thousands) September 30, 2019 December 31, 2018 White Cliffs $ 10,274 $ 9,373 Advantage Joint Venture 74,711 72,944 Delaware Crossing Joint Venture 50,435 — EPIC Y-Grade 166,491 — EPIC Crude 263,476 — Total Investments $ 565,387 $ 82,317 |
Investment Income | The following table presents our investment loss (income) for the periods indicated: Three Months Ended September 30, Nine Months Ended September 30, (in thousands) 2019 2018 2019 2018 White Cliffs $ (716 ) $ (912 ) $ (2,605 ) $ (2,716 ) Advantage Joint Venture (1,867 ) (2,772 ) (5,621 ) (7,569 ) Delaware Crossing Joint Venture 512 — 2,050 — EPIC Y-Grade 2,000 — 3,054 — EPIC Crude 6,130 — 9,375 — Other (1) (438 ) (182 ) (1,225 ) (540 ) Total Investment Loss (Income) $ 5,621 $ (3,866 ) $ 5,028 $ (10,825 ) (1) Represents income associated with our fee for serving as the operator of the Advantage Joint Venture and Delaware Crossing Joint Venture. |
Segment Information (Tables)
Segment Information (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information, by Segment | Summarized financial information concerning our reportable segments is as follows: (in thousands) Gathering Systems (1) Fresh Water Delivery (1) Investments in Midstream Entities Corporate (2) Consolidated Three Months Ended September 30, 2019 Midstream Services — Affiliate $ 79,999 $ 20,847 $ — $ — $ 100,846 Midstream Services — Third Party 17,475 2,132 — — 19,607 Crude Oil Sales — Third Party 48,870 — — — 48,870 Total Revenues 146,344 22,979 — — 169,323 Income (Loss) Before Income Taxes 61,952 18,825 (5,621 ) (8,681 ) 66,475 Additions to Long-Lived Assets 56,781 4,646 — 299 61,726 Additions to Investments — — 86,757 — 86,757 Three Months Ended September 30, 2018 Midstream Services — Affiliate $ 55,720 $ 17,416 $ — $ — $ 73,136 Midstream Services — Third Party 14,005 5,929 — — 19,934 Crude Oil Sales — Third Party 46,093 — — — 46,093 Total Revenues 115,818 23,345 — — 139,163 Income (Loss) Before Income Taxes 34,780 18,129 3,866 (8,166 ) 48,609 Additions to Long-Lived Assets 72,948 6,159 — — 79,107 Additions to Investments — — 307 — 307 Nine Months Ended September 30, 2019 Midstream Services — Affiliate $ 211,923 $ 66,801 $ — $ — $ 278,724 Midstream Services — Third Party 54,903 8,395 — — 63,298 Crude Oil Sales — Third Party 133,522 — — — 133,522 Total Revenues 400,348 75,196 — — 475,544 Income (Loss) Before Income Taxes 158,671 55,655 (5,028 ) (26,172 ) 183,126 Additions to Long-Lived Assets 187,437 6,040 — 810 194,287 Additions to Investments — — 501,344 — 501,344 Nine Months Ended September 30, 2018 Midstream Services — Affiliate $ 147,549 $ 56,774 $ — $ — $ 204,323 Midstream Services — Third Party 31,831 12,932 — — 44,763 Crude Oil Sales — Third Party 109,781 — — — 109,781 Total Revenues 289,161 69,706 — — 358,867 Income (Loss) Before Income Taxes 94,674 54,066 10,825 (27,121 ) 132,444 Additions to Long-Lived Assets 669,908 18,711 — — 688,619 Additions to Investments — — 426 — 426 September 30, 2019 Total Assets $ 1,953,417 $ 87,100 $ 565,387 $ 16,862 $ 2,622,766 December 31, 2018 Total Assets $ 1,804,100 $ 96,280 $ 82,317 $ 15,220 $ 1,997,917 (1) A substantial portion of the financial statement activity associated with our DevCos is captured within the Gathering Systems and Fresh Water Delivery reportable segments. Although our unconsolidated investments are owned through certain DevCos, all financial statement activity associated with our unconsolidated investments is captured within the Investments in Midstream Entities reportable segment. As our DevCos represent VIEs, see the above reportable segments for our VIEs impact to the consolidated financial statements. (2) The Corporate segment includes all general Partnership activity not attributable to our DevCos. |
Leases (Tables)
Leases (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Leases [Abstract] | |
Assets and Liabilities, Leases | ROU assets and lease liabilities are as follows: (thousands) Balance Sheet Location September 30, 2019 Assets Operating (1) Other Noncurrent Assets $ 3,303 Finance (2) Total Property, Plant and Equipment, Net 3,958 Total ROU Assets $ 7,261 Liabilities Current Operating Other Current Liabilities $ 2,621 Finance Other Current Liabilities 1,743 Noncurrent Operating Other Noncurrent Liabilities 667 Finance (3) Long-Term Debt 339 Total Lease Liabilities $ 5,370 (1) All of our operating leases mature between 2019 through 2021. Future operating lease payments of $0.7 million are due in 2019, $2.5 million are due in 2020 and $0.2 million are due in 2021. (2) Finance lease assets are recorded net of accumulated amortization of $1.0 million as of September 30, 2019 . (3) Our finance lease matures during 2021. |
Partnership Distributions (Tabl
Partnership Distributions (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Equity [Abstract] | |
Distributions Made to Limited Partner, by Distribution | The following table details the distributions paid in respect of the periods presented below: Distributions (in thousands) Limited Partners Period Record Date Distribution Date Distribution per Limited Partner Unit Common Unitholders (1) Subordinated Unitholders Holder of IDRs Total Q4 2017 February 5, 2018 February 12, 2018 $ 0.4883 $ 11,566 $ 7,765 $ 520 $ 19,851 Q1 2018 May 7, 2018 May 14, 2018 $ 0.5110 $ 12,103 $ 8,126 $ 819 $ 21,048 Q2 2018 August 6, 2018 August 13, 2018 $ 0.5348 $ 12,668 $ 8,504 $ 1,134 $ 22,306 Q4 2018 February 4, 2019 February 11, 2019 $ 0.5858 $ 13,876 $ 9,316 $ 2,421 $ 25,613 Q1 2019 May 6, 2019 May 13, 2019 $ 0.6132 $ 14,534 $ 9,751 $ 3,507 $ 27,792 Q2 2019 August 5, 2019 August 12, 2019 $ 0.6418 $ 25,418 $ — $ 4,640 $ 30,058 (1) Distributions to common unitholders does not include distribution equivalent rights on units that vested under the Noble Midstream Partners LP 2016 Long-Term Incentive Plan (the LTIP). |
Net Income Per Limited Partne_2
Net Income Per Limited Partner Unit (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted | Our calculation of net income per limited partner Common and Subordinated Unit is as follows: Three Months Ended September 30, Nine Months Ended September 30, (in thousands, except per unit amounts) 2019 2018 2019 2018 Net Income Attributable to Noble Midstream Partners LP $ 40,632 $ 44,617 $ 120,600 $ 120,562 Less: Net Income Attributable to Incentive Distribution Rights 5,820 1,462 13,967 3,415 Net Income Attributable to Limited Partners $ 34,812 $ 43,155 $ 106,633 $ 117,147 Net Income Attributable to Common Units $ 34,812 $ 25,825 $ 84,266 $ 70,093 Net Income Attributable to Subordinated Units — 17,330 22,367 47,054 Net Income Attributable to Limited Partners $ 34,812 $ 43,155 $ 106,633 $ 117,147 Net Income Attributable to Limited Partners Per Limited Partner Unit — Basic Common Units $ 0.88 $ 1.09 $ 2.65 $ 2.96 Subordinated Units $ — $ 1.09 $ 2.89 $ 2.96 Net Income Attributable to Limited Partners Per Limited Partner Unit — Diluted Common Units $ 0.88 $ 1.09 $ 2.64 $ 2.96 Subordinated Units $ — $ 1.09 $ 2.89 $ 2.96 Weighted Average Limited Partner Units Outstanding — Basic Common Units 39,604 23,688 31,855 23,686 Subordinated Units — 15,903 7,747 15,903 Weighted Average Limited Partner Units Outstanding — Diluted Common Units 39,624 23,704 31,879 23,701 Subordinated Units — 15,903 7,747 15,903 Antidilutive Restricted Units 44 21 66 22 |
Organization and Nature of Op_3
Organization and Nature of Operations - Partnership Assets (Details) | 9 Months Ended |
Sep. 30, 2019 | |
Colorado River DevCo LP | |
Equity [Line Items] | |
NBLX Ownership | 100.00% |
San Juan River DevCo LP | |
Equity [Line Items] | |
NBLX Ownership | 25.00% |
Noncontrolling Interest | 75.00% |
Green River DevCo LP | |
Equity [Line Items] | |
NBLX Ownership | 25.00% |
Noncontrolling Interest | 75.00% |
Laramie River DevCo LP | Greeley Crescent IDP (DJ Basin) | |
Equity [Line Items] | |
NBLX Ownership | 100.00% |
Laramie River DevCo LP | Black Diamond Dedication Area (DJ Basin) | |
Equity [Line Items] | |
NBLX Ownership | 54.40% |
Noncontrolling Interest | 45.60% |
Blanco River DevCo LP | |
Equity [Line Items] | |
NBLX Ownership | 40.00% |
Noncontrolling Interest | 60.00% |
Gunnison River DevCo LP | |
Equity [Line Items] | |
NBLX Ownership | 5.00% |
Noncontrolling Interest | 95.00% |
Trinity River DevCo LLC | |
Equity [Line Items] | |
NBLX Ownership | 100.00% |
Dos Rios DevCo LLC | |
Equity [Line Items] | |
NBLX Ownership | 100.00% |
Basis of Presentation - Narrati
Basis of Presentation - Narrative (Details) - USD ($) $ / shares in Units, $ in Thousands | Mar. 25, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 |
Accounting Policies [Abstract] | |||||||
Equity commitment amount | $ 200,000 | ||||||
Preferred units issued (in shares) | 100,000 | ||||||
Face value per unit (in dollars per share) | $ 1,000 | ||||||
Proceeds from issuance | $ 100,000 | ||||||
Offering costs | 3,400 | ||||||
Remaining equity commitment | $ 100,000 | ||||||
Dividend rate | 6.50% | ||||||
Accretion | $ 3,114 | $ 3,151 | $ 6,300 | ||||
Operating lease, weighted average discount rate | 3.69% | 3.69% | |||||
Finance lease, weighted average discount rate | 2.80% | 2.80% | |||||
Accumulated Amortization | $ 53,700 | $ 53,700 | $ 29,600 | ||||
Amortization expense | $ 8,100 | $ 8,100 | $ 24,200 | $ 21,400 | |||
Weighted average amortization period | 11 years |
Basis of Presentation - Summary
Basis of Presentation - Summary of Cash, Cash Equivalents and Restricted Cash (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Dec. 31, 2017 | |
Accounting Policies [Abstract] | |||||
Cash and Cash Equivalents | $ 17,571 | $ 10,740 | $ 18,201 | $ 18,026 | |
Restricted Cash | 50 | 951 | 951 | 37,505 | |
Cash, Cash Equivalents, and Restricted Cash | [1] | $ 17,621 | $ 11,691 | $ 19,152 | $ 55,531 |
[1] | See Note 2. Basis of Presentation for our reconciliation of total cash. |
Basis of Presentation - Perform
Basis of Presentation - Performance Obligation Expected Satisfaction (Details) $ in Thousands | Sep. 30, 2019USD ($) |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Amount | $ 82,068 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2019-10-01 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Amount | $ 7,616 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Expected Timing | 3 months |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2020-01-01 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Amount | $ 36,817 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Expected Timing | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-01-01 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Amount | $ 37,635 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Expected Timing | 1 year |
Acquisition - Narrative (Detail
Acquisition - Narrative (Details) a in Thousands, $ in Thousands | Jan. 31, 2018USD ($) | Sep. 30, 2019USD ($)aMMBTUcustomermi |
Black Diamond Acquisition | ||
Business Acquisition [Line Items] | ||
Payments to acquire | $ 638,500 | |
Length of pipeline | mi | 160 | |
Production per day | MMBTU | 300 | |
Black Diamond Acquisition | ||
Business Acquisition [Line Items] | ||
Dedicated acres | a | 141 | |
Number of customers | customer | 6 | |
Black Diamond Gathering LLC | ||
Business Acquisition [Line Items] | ||
Payment to expand acreage dedication | $ 24,100 | |
Increase in duration of the acreage dedication | 5 years | |
Black Diamond Gathering LLC | Black Diamond Acquisition | ||
Business Acquisition [Line Items] | ||
Payments to acquire | 638,266 | |
Payment to expand acreage dedication | 24,120 | |
Greenfield Member | Black Diamond Acquisition | ||
Business Acquisition [Line Items] | ||
Payments to acquire | 318,600 | |
Black Diamond Gathering LLC | ||
Business Acquisition [Line Items] | ||
Ownership interest, equity method | 54.40% | |
Ownership promote | 4.40% | |
Black Diamond Gathering LLC | Greenfield Member | ||
Business Acquisition [Line Items] | ||
Ownership interest, equity method | 45.60% | |
Noble Member | Black Diamond Acquisition | ||
Business Acquisition [Line Items] | ||
Payments to acquire | $ 319,900 |
Acquisition - Allocation of Pur
Acquisition - Allocation of Purchase Price (Details) - USD ($) $ in Thousands | Jan. 31, 2018 | Sep. 30, 2019 | Dec. 31, 2018 |
Business Acquisition [Line Items] | |||
Implied Goodwill | $ 109,734 | $ 109,734 | |
Black Diamond Acquisition | |||
Business Acquisition [Line Items] | |||
Cash Consideration | $ 638,500 | ||
Black Diamond Gathering LLC | |||
Business Acquisition [Line Items] | |||
PDC Energy Payment | $ 24,100 | ||
Black Diamond Gathering LLC | Black Diamond Acquisition | |||
Business Acquisition [Line Items] | |||
Cash Consideration | 638,266 | ||
PDC Energy Payment | 24,120 | ||
Current Liabilities Assumed | 18,259 | ||
Total Purchase Price and Liabilities Assumed | 680,645 | ||
Cash and Restricted Cash | 12,518 | ||
Accounts Receivable | 10,661 | ||
Other Current Assets | 2,206 | ||
Property, Plant and Equipment | 205,766 | ||
Intangible Assets | 339,760 | ||
Fair Value of Identifiable Assets | 570,911 | ||
Implied Goodwill | 109,734 | ||
Total Asset Value | $ 680,645 |
Acquisition - Pro Forma Informa
Acquisition - Pro Forma Information (Details) - Black Diamond Acquisition - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Business Acquisition [Line Items] | ||||
Revenues | $ 169,323 | $ 139,163 | $ 475,544 | $ 369,379 |
Net Income | 66,383 | 48,703 | 182,836 | 129,796 |
Net Income Attributable to Noble Midstream Partners LP | $ 40,632 | $ 44,617 | $ 120,600 | $ 118,896 |
Subordinated Units | ||||
Net Income Attributable to Limited Partners Per Limited Partner Unit — Basic | ||||
Net Income Attributable to Limited Partners Per Limited Partner Common and Subordinated Unit - Basic (in dollars per share) | $ 0 | $ 1.09 | $ 2.89 | $ 2.92 |
Net Income Attributable to Limited Partners Per Limited Partner Common and Subordinated Unit - Diluted (in dollars per share) | 0 | 1.09 | 2.89 | 2.92 |
Common Units | ||||
Net Income Attributable to Limited Partners Per Limited Partner Unit — Basic | ||||
Net Income Attributable to Limited Partners Per Limited Partner Common and Subordinated Unit - Basic (in dollars per share) | 0.88 | 1.09 | 2.65 | 2.92 |
Net Income Attributable to Limited Partners Per Limited Partner Common and Subordinated Unit - Diluted (in dollars per share) | $ 0.88 | $ 1.09 | $ 2.64 | $ 2.92 |
Transactions with Affiliates (D
Transactions with Affiliates (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Related Party Transaction [Line Items] | ||||
Total Midstream Services — Affiliate | $ 100,846 | $ 73,136 | $ 278,724 | $ 204,323 |
General and Administrative Expense — Affiliate | 1,805 | 1,894 | 5,601 | 5,599 |
General and Administrative Expense — Third Party | 2,324 | 2,310 | 7,389 | 14,027 |
Total General and Administrative Expense | 4,129 | 4,204 | 12,990 | 19,626 |
Noble Energy | Noble Energy | ||||
Related Party Transaction [Line Items] | ||||
Total Midstream Services — Affiliate | 100,846 | 73,136 | 278,724 | 204,323 |
Noble Energy | Noble Energy | Crude Oil, Natural Gas and Produced Water Gathering | ||||
Related Party Transaction [Line Items] | ||||
Total Midstream Services — Affiliate | 79,208 | 54,674 | 209,530 | 144,569 |
Noble Energy | Noble Energy | Fresh Water Delivery | ||||
Related Party Transaction [Line Items] | ||||
Total Midstream Services — Affiliate | 20,847 | 17,416 | 66,801 | 56,774 |
Noble Energy | Noble Energy | Other | ||||
Related Party Transaction [Line Items] | ||||
Total Midstream Services — Affiliate | $ 791 | $ 1,046 | $ 2,393 | $ 2,980 |
Property, Plant and Equipment_2
Property, Plant and Equipment (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Property, Plant and Equipment [Line Items] | ||
Total Property, Plant and Equipment, at Cost | $ 1,682,820 | $ 1,500,609 |
Less: Accumulated Depreciation and Amortization | (114,789) | (79,357) |
Total Property, Plant and Equipment, Net | 1,568,031 | 1,421,252 |
Crude Oil, Natural Gas and Produced Water Gathering Systems and Facilities | ||
Property, Plant and Equipment [Line Items] | ||
Total Property, Plant and Equipment, at Cost | 1,403,678 | 1,199,679 |
Construction in-progress | 146,700 | 147,100 |
Fresh Water Delivery Systems | ||
Property, Plant and Equipment [Line Items] | ||
Total Property, Plant and Equipment, at Cost | 80,840 | 78,820 |
Construction in-progress | 8,300 | 21,600 |
Crude Oil Treating Facilities | ||
Property, Plant and Equipment [Line Items] | ||
Total Property, Plant and Equipment, at Cost | 23,140 | 20,027 |
Construction-in-Progress | ||
Property, Plant and Equipment [Line Items] | ||
Total Property, Plant and Equipment, at Cost | 175,162 | 202,083 |
Equipment Reserved For Future Use | ||
Property, Plant and Equipment [Line Items] | ||
Construction in-progress | $ 18,800 | $ 32,800 |
Debt - Schedule of Long-term De
Debt - Schedule of Long-term Debt (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2019 | Dec. 31, 2018 | Aug. 23, 2019 | |
Debt Instrument [Line Items] | |||
Finance lease obligation | $ 2,082 | $ 3,231 | |
Total | 952,082 | 563,231 | |
Term Loan Credit Facility Unamortized Debt Issuance Costs | (1,432) | (979) | |
Total Debt | 950,650 | 562,252 | |
Finance Lease Obligation Due Within One Year | (1,743) | (3,231) | |
Long-Term Debt | 948,907 | 559,021 | |
Revolving Credit Facility, due March 9, 2023 | |||
Debt Instrument [Line Items] | |||
Debt | $ 50,000 | $ 60,000 | |
Interest Rate | 3.45% | 3.67% | |
2018 Term Loan Credit Facility, due July 31, 2021 | |||
Debt Instrument [Line Items] | |||
Debt | $ 500,000 | $ 500,000 | |
Interest Rate | 3.17% | 3.42% | |
2019 Term Loan Credit Facility, due August 23, 2022 | |||
Debt Instrument [Line Items] | |||
Debt | $ 400,000 | ||
Interest Rate | 3.05% | ||
Term Loan Credit Facility Unamortized Debt Issuance Costs | $ (600) |
Debt - Narrative (Details)
Debt - Narrative (Details) - USD ($) | Sep. 30, 2019 | Aug. 23, 2019 | Dec. 31, 2018 |
Line of Credit Facility [Line Items] | |||
Fees and expenses | $ 1,432,000 | $ 979,000 | |
2019 Term Loan Credit Facility, due August 23, 2022 | |||
Line of Credit Facility [Line Items] | |||
Borrowing capacity | $ 400,000,000 | ||
Fees and expenses | $ 600,000 |
Investments - Narrative (Detail
Investments - Narrative (Details) $ in Millions | Mar. 08, 2019MMBbls | Feb. 07, 2019MMBbls | Sep. 30, 2019USD ($) |
White Cliffs | |||
Schedule of Equity Method Investments [Line Items] | |||
Ownership percentage | 3.33% | ||
Advantage Joint Venture | |||
Schedule of Equity Method Investments [Line Items] | |||
Ownership interest, equity method | 50.00% | ||
Delaware Crossing Joint Venture | |||
Schedule of Equity Method Investments [Line Items] | |||
Ownership interest, equity method | 50.00% | ||
Daily capacity (in MBbl/d) | MMBbls | 160 | ||
Capital contributions | $ 51.5 | ||
EPIC Y-Grade | |||
Schedule of Equity Method Investments [Line Items] | |||
Ownership interest, equity method | 15.00% | ||
Capital contributions | $ 166.1 | ||
EPIC Crude | |||
Schedule of Equity Method Investments [Line Items] | |||
Ownership interest, equity method | 30.00% | ||
Daily capacity (in MBbl/d) | MMBbls | 590 | ||
Capital contributions | $ 268.7 |
Investments - Summary of Invest
Investments - Summary of Investments (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Investment [Line Items] | ||
Investments | $ 565,387 | $ 82,317 |
White Cliffs | ||
Investment [Line Items] | ||
Investments | 10,274 | 9,373 |
Advantage Joint Venture | ||
Investment [Line Items] | ||
Investments | 74,711 | 72,944 |
Delaware Crossing Joint Venture | ||
Investment [Line Items] | ||
Investments | 50,435 | 0 |
EPIC Y-Grade | ||
Investment [Line Items] | ||
Investments | 166,491 | 0 |
EPIC Crude | ||
Investment [Line Items] | ||
Investments | $ 263,476 | $ 0 |
Investments - Investment Income
Investments - Investment Income (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Investment [Line Items] | ||||
Total Investment Loss (Income) | $ 5,621 | $ (3,866) | $ 5,028 | $ (10,825) |
White Cliffs | ||||
Investment [Line Items] | ||||
Total Investment Loss (Income) | (716) | (912) | (2,605) | (2,716) |
Advantage Joint Venture | ||||
Investment [Line Items] | ||||
Total Investment Loss (Income) | (1,867) | (2,772) | (5,621) | (7,569) |
Delaware Crossing Joint Venture | ||||
Investment [Line Items] | ||||
Total Investment Loss (Income) | 512 | 0 | 2,050 | 0 |
EPIC Y-Grade | ||||
Investment [Line Items] | ||||
Total Investment Loss (Income) | 2,000 | 0 | 3,054 | 0 |
EPIC Crude | ||||
Investment [Line Items] | ||||
Total Investment Loss (Income) | 6,130 | 0 | 9,375 | 0 |
Other | ||||
Investment [Line Items] | ||||
Total Investment Loss (Income) | $ (438) | $ (182) | $ (1,225) | $ (540) |
Segment Information (Details)
Segment Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | |
Segment Reporting Information [Line Items] | |||||
Midstream Services — Affiliate | $ 100,846 | $ 73,136 | $ 278,724 | $ 204,323 | |
Total Revenues | 169,323 | 139,163 | 475,544 | 358,867 | |
Income (Loss) Before Income Taxes | 66,475 | 48,609 | 183,126 | 132,444 | |
Additions to Long-Lived Assets | 61,726 | 79,107 | 194,287 | 688,619 | |
Additions to Investments | 86,757 | 307 | 501,344 | 426 | |
Total Assets | 2,622,766 | 2,622,766 | $ 1,997,917 | ||
Gathering Systems | |||||
Segment Reporting Information [Line Items] | |||||
Midstream Services — Affiliate | 79,999 | 55,720 | 211,923 | 147,549 | |
Total Revenues | 146,344 | 115,818 | 400,348 | 289,161 | |
Income (Loss) Before Income Taxes | 61,952 | 34,780 | 158,671 | 94,674 | |
Additions to Long-Lived Assets | 56,781 | 72,948 | 187,437 | 669,908 | |
Additions to Investments | 0 | 0 | 0 | 0 | |
Total Assets | 1,953,417 | 1,953,417 | 1,804,100 | ||
Fresh Water Delivery | |||||
Segment Reporting Information [Line Items] | |||||
Midstream Services — Affiliate | 20,847 | 17,416 | 66,801 | 56,774 | |
Total Revenues | 22,979 | 23,345 | 75,196 | 69,706 | |
Income (Loss) Before Income Taxes | 18,825 | 18,129 | 55,655 | 54,066 | |
Additions to Long-Lived Assets | 4,646 | 6,159 | 6,040 | 18,711 | |
Additions to Investments | 0 | 0 | 0 | 0 | |
Total Assets | 87,100 | 87,100 | 96,280 | ||
Investments in Midstream Entities | |||||
Segment Reporting Information [Line Items] | |||||
Midstream Services — Affiliate | 0 | 0 | 0 | 0 | |
Total Revenues | 0 | 0 | 0 | 0 | |
Income (Loss) Before Income Taxes | (5,621) | 3,866 | (5,028) | 10,825 | |
Additions to Long-Lived Assets | 0 | 0 | 0 | 0 | |
Additions to Investments | 86,757 | 307 | 501,344 | 426 | |
Total Assets | 565,387 | 565,387 | 82,317 | ||
Corporate | |||||
Segment Reporting Information [Line Items] | |||||
Midstream Services — Affiliate | 0 | 0 | 0 | 0 | |
Total Revenues | 0 | 0 | 0 | 0 | |
Income (Loss) Before Income Taxes | (8,681) | (8,166) | (26,172) | (27,121) | |
Additions to Long-Lived Assets | 299 | 0 | 810 | 0 | |
Additions to Investments | 0 | 0 | 0 | 0 | |
Total Assets | 16,862 | 16,862 | $ 15,220 | ||
Midstream Services — Third Party | |||||
Segment Reporting Information [Line Items] | |||||
Services and Sales Revenues - Third Party | 19,607 | 19,934 | 63,298 | 44,763 | |
Midstream Services — Third Party | Gathering Systems | |||||
Segment Reporting Information [Line Items] | |||||
Services and Sales Revenues - Third Party | 17,475 | 14,005 | 54,903 | 31,831 | |
Midstream Services — Third Party | Fresh Water Delivery | |||||
Segment Reporting Information [Line Items] | |||||
Services and Sales Revenues - Third Party | 2,132 | 5,929 | 8,395 | 12,932 | |
Midstream Services — Third Party | Investments in Midstream Entities | |||||
Segment Reporting Information [Line Items] | |||||
Services and Sales Revenues - Third Party | 0 | 0 | 0 | 0 | |
Midstream Services — Third Party | Corporate | |||||
Segment Reporting Information [Line Items] | |||||
Services and Sales Revenues - Third Party | 0 | 0 | 0 | 0 | |
Crude Oil Sales — Third Party | |||||
Segment Reporting Information [Line Items] | |||||
Services and Sales Revenues - Third Party | 48,870 | 46,093 | 133,522 | 109,781 | |
Crude Oil Sales — Third Party | Gathering Systems | |||||
Segment Reporting Information [Line Items] | |||||
Services and Sales Revenues - Third Party | 48,870 | 46,093 | 133,522 | 109,781 | |
Crude Oil Sales — Third Party | Fresh Water Delivery | |||||
Segment Reporting Information [Line Items] | |||||
Services and Sales Revenues - Third Party | 0 | 0 | 0 | 0 | |
Crude Oil Sales — Third Party | Investments in Midstream Entities | |||||
Segment Reporting Information [Line Items] | |||||
Services and Sales Revenues - Third Party | 0 | 0 | 0 | 0 | |
Crude Oil Sales — Third Party | Corporate | |||||
Segment Reporting Information [Line Items] | |||||
Services and Sales Revenues - Third Party | $ 0 | $ 0 | $ 0 | $ 0 |
Leases - ROU Assets and Lease L
Leases - ROU Assets and Lease Liabilities (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Assets | ||
Operating | $ 3,303 | |
Finance | 3,958 | |
Total ROU Assets | 7,261 | |
Current | ||
Operating | 2,621 | |
Finance | 1,743 | $ 3,231 |
Noncurrent | ||
Operating | 667 | |
Finance | 339 | |
Total Lease Liabilities | 5,370 | |
Future operating lease payments, remainder of 2019 | 700 | |
Future operating lease payments, 2020 | 2,500 | |
Future operating lease payments, 2021 | 200 | |
Accumulated amortization | $ 1,000 |
Partnership Distributions - Nar
Partnership Distributions - Narrative (Details) - USD ($) $ / shares in Units, $ in Thousands | Nov. 11, 2019 | Oct. 24, 2019 | May 14, 2019 | Apr. 25, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2019 |
Equity [Abstract] | |||||||||||
Partner distribution period | 45 days | ||||||||||
Maximum eligibility of available cash (as a percent) | 50.00% | ||||||||||
Incentive distribution rights threshold (in dollars per share) | $ 0.4313 | ||||||||||
Distribution Made to Limited Partner [Line Items] | |||||||||||
Distribution (in dollars per share) | $ 0.6132 | $ 0.6418 | $ 0.6132 | $ 0.5858 | $ 0.5348 | $ 0.5110 | $ 0.4883 | ||||
Incentive distribution | $ 4,640 | $ 3,507 | $ 2,421 | $ 1,134 | $ 819 | $ 520 | |||||
Subsequent Event | General Partner | |||||||||||
Distribution Made to Limited Partner [Line Items] | |||||||||||
Incentive distribution | $ 5,800 | ||||||||||
Subordinated Units | Limited Partner | |||||||||||
Distribution Made to Limited Partner [Line Items] | |||||||||||
Partners' Subordinated Units converted | 15,902,584 | ||||||||||
Common Units | Subsequent Event | |||||||||||
Distribution Made to Limited Partner [Line Items] | |||||||||||
Distribution (in dollars per share) | $ 0.6716 |
Partnership Distributions - Sum
Partnership Distributions - Summary of Distributions (Details) - USD ($) $ / shares in Units, $ in Thousands | Apr. 25, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 |
Distribution Made to Limited Partner [Line Items] | |||||||
Distribution (in dollars per share) | $ 0.6132 | $ 0.6418 | $ 0.6132 | $ 0.5858 | $ 0.5348 | $ 0.5110 | $ 0.4883 |
Distributions | $ 30,058 | $ 27,792 | $ 25,613 | $ 22,306 | $ 21,048 | $ 19,851 | |
Incentive distribution | 4,640 | 3,507 | 2,421 | 1,134 | 819 | 520 | |
Common Units | |||||||
Distribution Made to Limited Partner [Line Items] | |||||||
Distributions | 25,418 | 14,534 | 13,876 | 12,668 | 12,103 | 11,566 | |
Subordinated Units | |||||||
Distribution Made to Limited Partner [Line Items] | |||||||
Distributions | $ 0 | $ 9,751 | $ 9,316 | $ 8,504 | $ 8,126 | $ 7,765 |
Net Income Per Limited Partne_3
Net Income Per Limited Partner Unit (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Earnings Per Share, Diluted, by Common Class, Including Two Class Method [Line Items] | ||||
Net Income Attributable to Noble Midstream Partners LP | $ 40,632 | $ 44,617 | $ 120,600 | $ 120,562 |
Less: Net Income Attributable to Incentive Distribution Rights | 5,820 | 1,462 | 13,967 | 3,415 |
Net Income Attributable to Limited Partners | $ 34,812 | $ 43,155 | $ 106,633 | $ 117,147 |
Antidilutive Restricted Units (in shares) | 44 | 21 | 66 | 22 |
Common Units | ||||
Earnings Per Share, Diluted, by Common Class, Including Two Class Method [Line Items] | ||||
Net Income Attributable to Limited Partners | $ 34,812 | $ 25,825 | $ 84,266 | $ 70,093 |
Net Income Attributable to Limited Partners Per Limited Partner Unit — Basic (in usd per share) | $ 0.88 | $ 1.09 | $ 2.65 | $ 2.96 |
Net Income Attributable to Limited Partners Per Limited Partner Unit — Diluted (in usd per share) | $ 0.88 | $ 1.09 | $ 2.64 | $ 2.96 |
Weighed Average Limited Partner Units Outstanding, Basic (in shares) | 39,604 | 23,688 | 31,855 | 23,686 |
Weighed Average Limited Partner Units Outstanding, Diluted (in shares) | 39,624 | 23,704 | 31,879 | 23,701 |
Subordinated Units | ||||
Earnings Per Share, Diluted, by Common Class, Including Two Class Method [Line Items] | ||||
Net Income Attributable to Limited Partners | $ 0 | $ 17,330 | $ 22,367 | $ 47,054 |
Net Income Attributable to Limited Partners Per Limited Partner Unit — Basic (in usd per share) | $ 0 | $ 1.09 | $ 2.89 | $ 2.96 |
Net Income Attributable to Limited Partners Per Limited Partner Unit — Diluted (in usd per share) | $ 0 | $ 1.09 | $ 2.89 | $ 2.96 |
Weighed Average Limited Partner Units Outstanding, Basic (in shares) | 0 | 15,903 | 7,747 | 15,903 |
Weighed Average Limited Partner Units Outstanding, Diluted (in shares) | 0 | 15,903 | 7,747 | 15,903 |