Cover
Cover - shares | 9 Months Ended | |
Sep. 30, 2022 | Oct. 31, 2022 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Sep. 30, 2022 | |
Document Transition Report | false | |
Entity File Number | 001-38048 | |
Entity Registrant Name | KINETIK HOLDINGS INC. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 81-4675947 | |
Entity Address, Address Line One | 2700 Post Oak Blvd | |
Entity Address, Address Line Two | Suite 300 | |
Entity Address, City or Town | Houston | |
Entity Address, State or Province | TX | |
Entity Address, Postal Zip Code | 77056 | |
City Area Code | 713 | |
Local Phone Number | 621-7330 | |
Title of 12(b) Security | Class A common stock, $0.0001 par value | |
Trading Symbol | KNTK | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | false | |
Entity Shell Company | false | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2022 | |
Document Fiscal Period Focus | Q3 | |
Entity Central Index Key | 0001692787 | |
Current Fiscal Year End Date | --12-31 | |
Class A Common Stock | ||
Document Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 43,082,157 | |
Class C Common Stock | ||
Document Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 94,270,000 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |||||
Operating revenues: | ||||||||
Total operating revenues | [1] | $ 325,176 | $ 166,586 | $ 917,997 | $ 450,455 | |||
Operating costs and expenses: | ||||||||
Costs of sales (exclusive of depreciation and amortization shown separately below) | [1] | 145,208 | 60,503 | 418,197 | 141,011 | |||
Operating expenses | [1] | 35,845 | 22,731 | 100,996 | 63,575 | |||
Ad valorem taxes | [1] | 5,903 | 3,238 | 15,936 | 9,003 | |||
General and administrative expenses | [1] | 23,468 | 6,957 | 72,180 | 17,920 | |||
Depreciation and amortization | [1] | 65,005 | 57,154 | 192,609 | 170,291 | |||
Loss (gain) on disposal of assets | 3,946 | [1] | (37) | [1] | 12,602 | [1] | 417 | |
Loss (gain) on disposal of assets | [1] | 417 | ||||||
Total operating costs and expenses | [1] | 279,375 | 150,546 | 812,520 | 402,217 | |||
Operating income | [1] | 45,801 | 16,040 | 105,477 | 48,238 | |||
Other income (expense): | ||||||||
Interest and other income | [1] | 0 | 3,578 | 250 | 4,141 | |||
Gain on redemption of mandatorily redeemable Preferred Units | [1] | 0 | 0 | 9,580 | 0 | |||
(Gain) loss on debt extinguishment | 0 | (56) | (27,975) | 4 | ||||
Gain on embedded derivative | [1] | 488 | 0 | 89,050 | 0 | |||
Interest expense | [1] | (40,464) | (30,541) | (92,585) | (88,458) | |||
Equity in earnings of unconsolidated affiliates | [1] | 45,003 | 16,826 | 120,706 | 44,692 | |||
Total other income (expense), net | [1] | 5,027 | (10,193) | 99,026 | (39,621) | |||
Income before income taxes | [1] | 50,828 | 5,847 | 204,503 | 8,617 | |||
Income tax expense | [1] | 1,406 | 1,207 | 2,244 | 1,207 | |||
Net income including noncontrolling interest | [1] | 49,422 | 4,640 | 202,259 | 7,410 | |||
Net income attributable to Preferred Unit limited partners | [1] | 708 | 0 | 115,203 | 0 | |||
Net Income attributable to common shareholders | [1] | 48,714 | 4,640 | 87,056 | 7,410 | |||
Net income attributable to Common Unit limited partners | [1] | 33,778 | 4,640 | 61,817 | 7,410 | |||
Net income attributable to Class A Common Shareholders | [1] | $ 14,936 | $ 0 | $ 25,239 | $ 0 | |||
Net income attributable to Class A Common Shareholders per share | ||||||||
Basic (in USD per share) | [1] | $ 1.04 | $ 0 | $ 1.24 | $ 0 | |||
Diluted (in USD per share) | $ 1.04 | [1] | $ 0 | [1] | $ 1.24 | [1] | $ 0 | |
Weighted-average shares | ||||||||
Basic (in shares) | [1],[2] | 41,816 | 0 | 40,042 | 0 | |||
Diluted (in shares) | [1],[2] | 41,855 | 0 | 40,075 | 0 | |||
Service | ||||||||
Operating revenues: | ||||||||
Total operating revenues | [1] | $ 107,597 | $ 72,578 | $ 290,122 | $ 202,482 | |||
Product | ||||||||
Operating revenues: | ||||||||
Total operating revenues | [1] | 213,803 | 93,266 | 618,382 | 244,358 | |||
Other revenue | ||||||||
Operating revenues: | ||||||||
Total operating revenues | [1] | $ 3,776 | $ 742 | $ 9,493 | $ 3,615 | |||
[1]The results of the legacy ALTM business are not included in the Company’s consolidated financials prior to February 22, 2022. Refer to the basis of presentation in Note 1—Description of the Organization and Summary of Significant Accounting Policies in the Notes to our Condensed Consolidated Financial Statements in this Form 10-Q for further information. Note 10 — Equity and Warrants ), which was effected on June 8, 2022. Refer to Note 10 – Equity and Warrants in the Notes to our Condensed Consolidated Financial Statements in this Form 10-Q for further information. |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 | |
CURRENT ASSETS: | |||
Cash and cash equivalents | $ 11,728 | $ 18,729 | |
Accounts receivable, net of allowance for credit losses of $1,000 in 2022 and 2021 | 269,634 | 178,107 | |
Prepaid and other current assets | 37,431 | 20,683 | |
Total assets, current | 318,793 | 217,519 | |
NONCURRENT ASSETS: | |||
Property, plant and equipment, net | 2,528,659 | 1,839,279 | |
Intangible assets, net | 722,391 | 786,049 | |
Operating lease right-of-use assets | 34,677 | 61,562 | |
Deferred charges and other assets | 25,505 | 22,320 | |
Investment in unconsolidated affiliates | 2,372,596 | 626,477 | |
Goodwill | 4,557 | 0 | |
Total assets, noncurrent | 5,688,385 | 3,335,687 | |
Total assets | 6,007,178 | 3,553,206 | |
CURRENT LIABILITIES: | |||
Accounts payable | 16,002 | 12,220 | |
Accrued expenses | 235,160 | 135,643 | |
Derivative liabilities | 0 | 2,667 | |
Current portion of operating lease liabilities | 25,466 | 31,776 | |
Current portion of long-term debt, net | 0 | 54,280 | |
Other current liabilities | 8,039 | 4,339 | |
Current liabilities | 284,667 | 240,925 | |
NONCURRENT LIABILITIES: | |||
Long-term debt, net | 3,447,513 | 2,253,422 | |
Contract liabilities | 22,707 | 11,674 | |
Operating lease liabilities | 9,033 | 29,889 | |
Derivative liabilities | 0 | 200 | |
Other liabilities | 2,867 | 2,219 | |
Contingent liabilities | 0 | 839 | |
Deferred tax liabilities | 13,082 | 7,190 | |
Noncurrent liabilities | 3,495,202 | 2,305,433 | |
Total liabilities | 3,779,869 | 2,546,358 | |
COMMITMENTS AND CONTINGENCIES (Note 8) | |||
Redeemable noncontrolling interest — Common Unit limited partners | 3,061,861 | 1,006,838 | |
EQUITY: | |||
Additional paid-in capital | 107,182 | 0 | |
Accumulated deficit | (941,747) | 0 | |
Total equity | (834,552) | 10 | |
Total liabilities, noncontrolling interests, and equity | 6,007,178 | 3,553,206 | |
Class A Common Stock | |||
EQUITY: | |||
Common stock | [1] | 4 | 0 |
Class C Common Stock | |||
EQUITY: | |||
Common stock | [1] | $ 9 | $ 10 |
[1]Share amounts have been retroactively restated to reflect the Company’s Stock Split (as defined in Note 10—Equity and Warrants ), which was effected on June 8, 2022. Refer to Note 10—Equity and Warrants in the Notes to our Condensed Consolidated Financial Statements in this Form 10-Q for further information. |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Accounts receivable, allowance for credit losses | $ 1,000 | $ 1,000 |
Class A Common Stock | ||
Common stock, par value (in USD per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized (in shares) | 1,500,000,000 | 1,500,000,000 |
Common stock, shares issued (in shares) | 43,082,157 | 0 |
Common stock, shares outstanding (in shares) | 43,082,157 | 0 |
Class C Common Stock | ||
Common stock, par value (in USD per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized (in shares) | 1,500,000,000 | 1,500,000,000 |
Common stock, shares issued (in shares) | 94,270,000 | 100,000,000 |
Common stock, shares outstanding (in shares) | 94,270,000 | 100,000,000 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 9 Months Ended | |||
Sep. 30, 2022 | Sep. 30, 2021 | |||
CASH FLOWS FROM OPERATING ACTIVITIES | ||||
Net income including noncontrolling interests | [1] | $ 202,259,000 | $ 7,410,000 | |
Adjustments to reconcile net income to net cash provided by operating activities: | ||||
Depreciation and amortization expense | [1] | 192,609,000 | 170,291,000 | |
Amortization of debt issuance costs | 8,053,000 | 9,991,000 | ||
Amortization of contract costs | 1,344,000 | 1,815,000 | ||
Contingent liabilities remeasurement | (839,000) | (377,000) | ||
Distributions from unconsolidated affiliates | 185,786,000 | 47,017,000 | ||
Derivatives settlement | 11,115,000 | (17,959,000) | ||
Derivatives fair value adjustment | (103,032,000) | 13,943,000 | ||
Gain on redemption of mandatorily redeemable Preferred Units | (9,580,000) | 0 | ||
Loss on disposal of assets | 12,602,000 | [1] | 417,000 | |
Equity in earnings from unconsolidated affiliates | [1] | (120,706,000) | (44,692,000) | |
(Gain) loss on debt extinguishment | 27,975,000 | (4,000) | ||
Share-based compensation | 30,966,000 | 0 | ||
Deferred income taxes | 1,882,000 | 1,207,000 | ||
Change in operating assets and liabilities: | ||||
Accounts receivable | (73,927,000) | (118,606,000) | ||
Other assets | (9,583,000) | (7,303,000) | ||
Accounts payable | 926,000 | (2,141,000) | ||
Accrued liabilities | 95,675,000 | 96,347,000 | ||
Operating lease liabilities | (281,000) | 1,994,000 | ||
Net cash provided by operating activities | 453,244,000 | 159,350,000 | ||
CASH FLOWS FROM INVESTING ACTIVITIES | ||||
Property, plant and equipment expenditures | (160,478,000) | (60,609,000) | ||
Intangible assets expenditures | (13,332,000) | (3,733,000) | ||
Investment in unconsolidated affiliates | (56,199,000) | (20,522,000) | ||
Cash proceeds from disposals | 190,000 | 3,541,000 | ||
Net cash acquired in acquisition | 13,401,000 | 0 | ||
Net cash used in investing activities | (216,418,000) | (81,323,000) | ||
CASH FLOWS FROM FINANCING ACTIVITIES | ||||
Proceeds from issuance of long-term debt | 3,000,000,000 | 30,189,000 | ||
Principal payments on long-term debt | (2,294,130,000) | (80,177,000) | ||
Payment on debt issuance costs | (36,873,000) | (3,152,000) | ||
Proceeds from revolver | 537,000,000 | 33,000,000 | ||
Payment on revolver | (771,000,000) | (27,000,000) | ||
Redemption of mandatorily redeemable Preferred Units | (183,297,000) | 0 | ||
Redemption of redeemable noncontrolling interest Preferred Units | (461,460,000) | 0 | ||
Distributions paid to mandatorily redeemable Preferred Units holders | (1,850,000) | 0 | ||
Distributions paid to redeemable noncontrolling interest Preferred Units limited partners | (6,937,000) | 0 | ||
Cash dividends paid to Class A Common Stock shareholders | (24,351,000) | 0 | ||
Distributions paid to Class C Common Units limited partners | (929,000) | (30,189,000) | ||
Equity contributions | 0 | 14,890,000 | ||
Net cash used in financing activities | (243,827,000) | (62,439,000) | ||
Net change in cash | (7,001,000) | 15,588,000 | ||
CASH, BEGINNING OF PERIOD | 18,729,000 | 19,591,000 | ||
CASH, END OF PERIOD | 11,728,000 | 35,179,000 | ||
SUPPLEMENTAL SCHEDULE OF INVESTING AND FINANCING ACTIVITIES | ||||
Cash paid for interest, net of amounts capitalized | 76,592,000 | 81,521,000 | ||
Property and equipment and intangible accruals in accounts payable and accrued liabilities | 17,717,000 | 9,357,000 | ||
Class A Common Stock issued through dividend and distribution reinvestment plan | 175,453,000 | 0 | ||
Restructuring Cost and Reserve [Line Items] | ||||
Class A Common Stock issued in exchange | 1,013,745,000 | |||
Altus Midstream LP | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Fair value of ALTM assets acquired | 2,446,429,000 | 0 | ||
Class A Common Stock issued in exchange | 1,013,745,000 | 0 | ||
ALTM liabilities and mezzanine equity assumed | $ 1,432,684,000 | $ 0 | ||
[1]The results of the legacy ALTM business are not included in the Company’s consolidated financials prior to February 22, 2022. Refer to the basis of presentation in Note 1—Description of the Organization and Summary of Significant Accounting Policies in the Notes to our Condensed Consolidated Financial Statements in this Form 10-Q for further information. |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY AND NONCONTROLLING INTERESTS - USD ($) | Total | Preferred Unit limited partners | Apache limited partner | Class A Common Stock | Class C Common Stock | Common Stock Class A Common Stock | Common Stock Class C Common Stock | Additional Paid-in Capital | Accumulated Deficit | |||||
Beginning balance at Dec. 31, 2020 | $ 0 | [1] | $ 1,041,655,000 | |||||||||||
Increase (Decrease) in Temporary Equity [Roll Forward] | ||||||||||||||
Contribution | 14,890,000 | |||||||||||||
Distribution paid to Common Unit limited partners | (30,189,000) | |||||||||||||
Net income | [2] | $ (7,410,000) | ||||||||||||
Net income | 7,410,000 | |||||||||||||
Ending balance at Sep. 30, 2021 | 0 | [1],[3] | 1,033,766,000 | |||||||||||
Beginning balance, shares (in shares) at Dec. 31, 2020 | [4] | 0 | 101,198,000 | |||||||||||
Beginning balance at Dec. 31, 2020 | 10,000 | $ 0 | $ 10,000 | $ 0 | $ 0 | |||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||
Contribution (in shares) | [4] | 492,000 | ||||||||||||
Contribution | 0 | $ 0 | ||||||||||||
Distribution paid to common unit limited partners (in shares) | [4] | (996,000) | ||||||||||||
Distribution paid to Common Unit limited partners | 0 | $ 0 | ||||||||||||
Excess of carrying amount over Preferred Units redemption price | 0 | |||||||||||||
Share-based compensation | 0 | |||||||||||||
Net income (loss) | [2] | 0 | ||||||||||||
Ending balance, shares (in shares) at Sep. 30, 2021 | [4],[5] | 0 | 100,694,000 | |||||||||||
Ending balance at Sep. 30, 2021 | 10,000 | $ 0 | $ 10,000 | 0 | 0 | |||||||||
Beginning balance at Jun. 30, 2021 | 0 | [3] | 1,029,126,000 | |||||||||||
Increase (Decrease) in Temporary Equity [Roll Forward] | ||||||||||||||
Net income | (4,640,000) | [2] | 4,640,000 | |||||||||||
Ending balance at Sep. 30, 2021 | 0 | [1],[3] | 1,033,766,000 | |||||||||||
Beginning balance, shares (in shares) at Jun. 30, 2021 | [5] | 0 | 100,694,000 | |||||||||||
Beginning balance at Jun. 30, 2021 | 10,000 | $ 0 | $ 10,000 | 0 | 0 | |||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||
Excess of carrying amount over Preferred Units redemption price | 0 | |||||||||||||
Share-based compensation | 0 | |||||||||||||
Net income (loss) | [2] | 0 | ||||||||||||
Ending balance, shares (in shares) at Sep. 30, 2021 | [4],[5] | 0 | 100,694,000 | |||||||||||
Ending balance at Sep. 30, 2021 | 10,000 | $ 0 | $ 10,000 | 0 | 0 | |||||||||
Beginning balance at Dec. 31, 2021 | 0 | [1] | 1,006,838,000 | |||||||||||
Ending balance at Jun. 30, 2022 | 563,338,000 | [3] | 3,251,290,000 | |||||||||||
Beginning balance, shares (in shares) at Dec. 31, 2021 | 0 | 100,000,000 | 0 | [4] | 100,000,000 | |||||||||
Beginning balance at Dec. 31, 2021 | 10,000 | $ 0 | $ 10,000 | 0 | 0 | |||||||||
Ending balance, shares (in shares) at Jun. 30, 2022 | [5] | 40,551,000 | 94,450,000 | |||||||||||
Ending balance at Jun. 30, 2022 | (1,181,330,000) | $ 4,000 | $ 9,000 | 0 | (1,181,343,000) | |||||||||
Beginning balance at Dec. 31, 2021 | 0 | [1] | 1,006,838,000 | |||||||||||
Increase (Decrease) in Temporary Equity [Roll Forward] | ||||||||||||||
Distribution paid to Common Unit limited partners | (141,729,000) | |||||||||||||
ALTM acquisition | [1] | 462,717,000 | ||||||||||||
Distributions paid to Preferred Unit limited partners | (6,937,000) | |||||||||||||
Redemption of Stock Units | (461,460,000) | (179,323,000) | ||||||||||||
Excess of carrying amount over Preferred Units redemption price | (109,523,000) | 76,623,000 | ||||||||||||
Net income | [2] | (61,817,000) | ||||||||||||
Net income | 115,203,000 | [1] | 61,817,000 | |||||||||||
Change in redemption value of noncontrolling interests | 2,237,635,000 | |||||||||||||
Ending balance at Sep. 30, 2022 | 0 | [1],[3] | 3,061,861,000 | |||||||||||
Beginning balance, shares (in shares) at Dec. 31, 2021 | 0 | 100,000,000 | 0 | [4] | 100,000,000 | |||||||||
Beginning balance at Dec. 31, 2021 | 10,000 | $ 0 | $ 10,000 | 0 | 0 | |||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||
ALTM acquisition (in shares) | [4] | 32,493,000 | ||||||||||||
ALTM acquisition | 1,013,745,000 | $ 3,000 | 1,013,742,000 | |||||||||||
Redemption of Common Units (in shares) | [4] | 5,730,000 | (5,730,000) | |||||||||||
Redemption of Common Units | 179,323,000 | $ 1,000 | $ (1,000) | 179,323,000 | ||||||||||
Excess of carrying amount over Preferred Units redemption price | 32,900,000 | 32,900,000 | ||||||||||||
Issuance of Class A Common Stock through dividend and distribution reinvestment plan (in shares) | 4,855,000 | |||||||||||||
Issuance of Class A Common Stock through dividend and distribution reinvestment plan | 175,453,000 | 175,453,000 | ||||||||||||
Share-based compensation (in shares) | 4,000 | |||||||||||||
Share-based compensation | 30,966,000 | 30,966,000 | ||||||||||||
Remeasurement of contingent consideration | 4,451,000 | 4,451,000 | ||||||||||||
Net income (loss) | 25,239,000 | [2] | 25,239,000 | |||||||||||
Change in redemption value of noncontrolling interests | (2,237,635,000) | (1,296,753,000) | (940,882,000) | |||||||||||
Dividends on Class A Common Stock | (59,004,000) | (59,004,000) | ||||||||||||
Ending balance, shares (in shares) at Sep. 30, 2022 | 43,082,157 | 94,270,000 | 43,082,000 | [4],[5] | 94,270,000 | [4],[5] | ||||||||
Ending balance at Sep. 30, 2022 | (834,552,000) | $ 4,000 | $ 9,000 | 107,182,000 | (941,747,000) | |||||||||
Beginning balance at Jun. 30, 2022 | 563,338,000 | [3] | 3,251,290,000 | |||||||||||
Increase (Decrease) in Temporary Equity [Roll Forward] | ||||||||||||||
Distribution paid to Common Unit limited partners | (70,838,000) | |||||||||||||
Redemption of Stock Units | 461,460,000 | (6,765,000) | ||||||||||||
Excess of carrying amount over Preferred Units redemption price | (102,586,000) | 76,623,000 | ||||||||||||
Net income | [2] | (33,778,000) | ||||||||||||
Net income | 708,000 | [3] | 33,778,000 | |||||||||||
Change in redemption value of noncontrolling interests | (222,227,000) | |||||||||||||
Ending balance at Sep. 30, 2022 | $ 0 | [1],[3] | $ 3,061,861,000 | |||||||||||
Beginning balance, shares (in shares) at Jun. 30, 2022 | [5] | 40,551,000 | 94,450,000 | |||||||||||
Beginning balance at Jun. 30, 2022 | (1,181,330,000) | $ 4,000 | $ 9,000 | 0 | (1,181,343,000) | |||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||
Redemption of Common Units (in shares) | [5] | 180,000 | (180,000) | |||||||||||
Redemption of Common Units | 6,765,000 | 6,765,000 | ||||||||||||
Excess of carrying amount over Preferred Units redemption price | 32,900,000 | 32,900,000 | ||||||||||||
Issuance of Class A Common Stock through dividend and distribution reinvestment plan (in shares) | 2,351,000 | |||||||||||||
Issuance of Class A Common Stock through dividend and distribution reinvestment plan | 87,756,000 | 87,756,000 | ||||||||||||
Share-based compensation | 12,661,000 | 12,661,000 | ||||||||||||
Net income (loss) | 14,936,000 | [2] | 14,936,000 | |||||||||||
Change in redemption value of noncontrolling interests | 222,227,000 | 222,227,000 | ||||||||||||
Dividends on Class A Common Stock | (30,467,000) | (30,467,000) | ||||||||||||
Ending balance, shares (in shares) at Sep. 30, 2022 | 43,082,157 | 94,270,000 | 43,082,000 | [4],[5] | 94,270,000 | [4],[5] | ||||||||
Ending balance at Sep. 30, 2022 | $ (834,552,000) | $ 4,000 | $ 9,000 | $ 107,182,000 | $ (941,747,000) | |||||||||
[1]Certain redemption features embedded within the Preferred Units require bifurcation and measurement at fair value. For further detail, refer to Note 11—Series A Cumulative Redeemable Preferred Units in the Notes to our Condensed Consolidated Financial Statements in this Form 10-Q for further information. Note 1—Description of the Organization and Summary of Significant Accounting Policies in the Notes to our Condensed Consolidated Financial Statements in this Form 10-Q for further information. Note 11—Series A Cumulative Redeemable Preferred Units in the Notes to our Condensed Consolidated Financial Statements in this Form 10-Q. Share amounts have been retroactively restated to reflect the Company’s Stock Split (as defined in Note 10 — Equity and Warrants ), which was effected on June 8, 2022. Refer to Note 10—Equity and Warrants in the Notes to our Condensed Consolidated Financial Statements in this Form 10-Q for further information. Share amounts have been retroactively restated to reflect the Company’s S tock Split (as defined in Note 10 — Equity and Warrants ), which was effected on June 8, 2022. Refer to Note 10—Equity and Warrants in the Notes to our Condensed Consolidated Financial Statements in this Form 10-Q for further information. |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY AND NONCONTROLLING INTERESTS (Parenthetical) - $ / shares | 3 Months Ended | 9 Months Ended |
Sep. 30, 2022 | Sep. 30, 2022 | |
Class A Common Stock | ||
Cash dividends (in USD per share) | $ 0.75 | $ 1.50 |
DESCRIPTION OF THE ORGANIZATION
DESCRIPTION OF THE ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 9 Months Ended |
Sep. 30, 2022 | |
Accounting Policies [Abstract] | |
DESCRIPTION OF THE ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | DESCRIPTION OF THE ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The Transaction On February 22, 2022 (the “Closing Date”), Kinetik Holdings Inc., a Delaware corporation (formerly known as Altus Midstream Company), consummated the previously announced business combination transactions contemplated by the Contribution Agreement, dated as of October 21, 2021 (the “Contribution Agreement”), by and among the Company, Altus Midstream LP (now known as Kinetik Holdings LP), a Delaware limited partnership and subsidiary of Altus Midstream Company (the “Partnership”), New BCP Raptor Holdco, LLC, a Delaware limited liability company (“Contributor”), and BCP Raptor Holdco, LP, a Delaware limited partnership (“BCP”). The transactions are referred to herein as the “Transaction.” Pursuant to the Contribution Agreement, in connection with the closing of the Transaction (the “Closing”), (i) Contributor contributed all of the equity interests of BCP and BCP Raptor Holdco GP, LLC, a Delaware limited liability company and the general partner of BCP (“BCP GP” and, together with BCP, the “Contributed Entities”), to the Partnership; and (ii) in exchange for such contribution, the Partnership transferred to Contributor 50,000,000 common units representing limited partner interests in the Partnership (“Common Units”) and t 50,000,000 shares of the Company’s Class C Common Stock, par value $0.0001 per share (“Class C Common Stock”). The Company’s stockholders immediately prior to the Closing continued to hold their shares of the Company’s Class A Common Stock, par value $0.0001 per share (“Class A Common Stock,” and together with the Company’s Class C Common Stock, “Common Stock”). As a result of the Transaction, immediately following the Closing (i) Contributor held approximately 75% of the issued and outstanding Common Stock, (ii) Apache Midstream LLC, a Delaware limited liability company (“Apache Midstream”), held approximately 20% of the issued and outstanding Common Stock, and (iii) the Company’s remaining stockholders held approximately 5% of the issued and outstanding Common Stock. The Company completed a two-for-one Stock Split in the form of a stock dividend on June 8, 2022. All corresponding per-share and share amounts for periods prior to June 8, 2022 have been retroactively restated elsewhere in this Form 10-Q to reflect the two-for-one Stock Split. However, the number of Common Units and shares of Class C Common Stock described in this Form 10-Q in relation to the Transaction are presented at pre-Stock-Split amounts to be consistent with our previous public filings and the terms of the Contribution Agreement. In connection with the Closing, the Company changed its name from “Altus Midstream Company” (“ALTM”) to “Kinetik Holdings Inc.” Unless otherwise noted or the context requires otherwise, references herein to Kinetik Holdings Inc. “the Company”, “us”, “our”, “we” or similar terms, with respect to time periods prior to February 22, 2022, include BCP and its consolidated subsidiaries and do not include ALTM and its consolidated subsidiaries, while references herein to Kinetik Holdings Inc. with respect to time periods from and after February 22, 2022, include ALTM and its consolidated subsidiaries. Organization BCP was formed on April 25, 2017 as a Delaware limited partnership to acquire and develop midstream oil and gas assets. BCP’s primary operating subsidiaries are EagleClaw Midstream Ventures, LLC (“EagleClaw”) and CR Permian Holdings, LLC (“CR Permian”). Both subsidiaries were formed to design, engineer, install, own and operate facilities and provide services for produced natural gas gathering, compression, processing, treating and dehydration, and condensate separation, stabilization, and storage, crude oil gathering and storage, water gathering and disposal assets. ALTM was originally incorporated on December 12, 2016 in Delaware under the name Kayne Anderson Acquisition Corp. (“KAAC”) for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses. KAAC completed its initial public offering in the second quarter of 2017. On August 3, 2018, Altus Midstream LP was formed in Delaware as a limited partnership and wholly-owned subsidiary of KAAC and entered into a contribution agreement with certain affiliates of Apache Corporation (“Apache” and such affiliates the “Altus Midstream Entities”), formed by Apache between May 2016 and January 2017, for the purpose of acquiring, developing, and operating midstream oil and gas assets in the Alpine High resource play and surrounding areas (“Alpine High”). On November 9, 2018, KAAC acquired all equity interests of the Altus Midstream Entities and changed its name to Altus Midstream Company. On February 22, 2022, upon the Closing, BCP and its subsidiaries became wholly owned subsidiaries of the Partnership. The Transaction was accounted for as a reverse merger pursuant to ASC 805 Business Combination (“ASC 805”). Refer to Note 2—Business Combination in the Notes to our Condensed Consolidated Financial Statements for further information. Nature of Operations Through its consolidated subsidiaries, the Company provides comprehensive gathering, water disposal, transportation, compression, processing and treating services necessary to bring natural gas, NGLs and crude oil to market. Additionally, the Company owns equity interests in four separate Permian Basin pipeline entities that have access to various markets along the Texas Gulf Coast. Basis of Presentation The accompanying unaudited Condensed Consolidated Financial Statements have been prepared in accordance with GAAP. Certain reclassifications of prior year balances have been made to conform such amounts to current year presentation. These reclassifications have no impact on net income. All adjustments that, in the opinion of management, are necessary for a fair presentation of the results of operations for the interim periods have been made and are of a recurring nature unless otherwise disclosed herein. The results of operations for such interim periods are not necessarily indicative of results of operations for a full year. All intercompany balances and transactions have been eliminated in consolidation. Prior to the Closing, the Company’s financial statements that were filed with the SEC were derived from ALTM’s accounting records. As the Transaction was determined to be a reverse merger, BCP was considered as the accounting acquirer and ALTM was the legal acquirer. The accompanying Condensed Consolidated Financial Statements herein include (1) BCP’s net assets carried at historical value, (2) BCP’s historical results of operations prior to the Transaction, (3) the ALTM’s net assets carried at fair value as of the Closing Date and (4) the combined results of operations with the Company’s results presented within the Condensed Consolidated Financial Statements from February 22, 2022 going forward. Refer to Note 2—Business Combination to our Condensed Consolidated Financial Statements in this Form 10-Q for additional discussion. The Company completed a two-for-one Stock Split on June 8, 2022. All corresponding per-share and share amounts for periods prior to June 8, 2022 have been retroactively restated in this Form 10-Q to reflect the two-for-one Stock Split, except for the number of Common Units and shares of Class C Common Stock described above in relation to the Transaction, which are presented at pre-Stock-Split amounts. This presentation election is consistent with our previous public filings and the terms of the Contribution Agreement. Use of Estimates Preparation of financial statements in conformity with GAAP and disclosure of contingent assets and liabilities requires management to make estimates and assumptions that affect reported amounts of assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. The Company bases its estimates on historical experience and various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about carrying values of assets and liabilities that are not readily apparent from other sources. The Company evaluates its estimates and assumptions on a regular basis. Actual results may differ from these estimates and assumptions used in preparation of its condensed consolidated financial statements, and changes in these estimates are recorded when known. Significant items subject to such estimates and assumptions include the valuation of tangible and intangible assets, share-based compensation, contingent liabilities, warrants, and noncontrolling interests. Variable Interest Entity The Company uses a qualitative approach in assessing the consolidation requirement for variable interest entities. The approach focuses on identifying which enterprise has the power to direct the activities that most significantly impact the variable interest entity’s economic performance and which enterprise has the obligation to absorb losses or the right to receive benefits from the variable interest entity. In the event that the Company is the primary beneficiary of a variable interest entity, the assets, liabilities, and results of operations of the variable interest entity would be consolidated in our financial statements. The Company has determined that it has significant influence over the operating and financial policies of the four pipeline entities in which it is invested, but does not exercise control over them; and hence, it accounts for these investments using the equity method. Refer to Note 9—Equity Method Investments in the Notes to our Condensed Consolidated Financial Statements in this Form 10-Q. Redeemable Noncontrolling Interest — Common Units Limited Partners Pursuant to the Contribution Agreement, in connection with the Closing, (i) Contributor contributed all of the equity interests of the Contributed Entities to the Partnership; and (ii) in exchange for such contribution, the Partnership transferred to Contributor 50,000,000 common units representing limited partner interests in the Partnership and 50,000,000 shares of the Company’s Class C Common Stock, par value $0.0001 per share. Please refer to “The Transaction” above. The Common Units are redeemable at the option of unit holders and accounted for in the Company’s Condensed Consolidated Balance Sheet as a redeemable noncontrolling interest classified as temporary equity. The Company records the redeemable noncontrolling interest at the higher of (i) its initial value plus accumulated earnings/losses associated with the noncontrolling interest or (ii) the maximum redemption value as of the balance sheet date. The redemption value was determined based on a 5-day volume weighted-average closing price of the Class A Common Stock. See discussion and additional details in Note 10—Equity and Warrant in the Notes to our Condensed Consolidated Financial Statements in this Form 10-Q. Redeemable Noncontrolling Interest — Preferred Unit Limited Partners The Partnership issued Series A Cumulative Redeemable Preferred Units (“Preferred Units”) on June 12, 2019. As the Transaction was accounted for as a reverse merger, the Company assumed certain Preferred Units that were issued and outstanding at Closing for accounting purposes. The Preferred Units are accounted for on the Company’s Condensed Consolidated Balance Sheet as a redeemable noncontrolling interest classified as temporary equity based on the terms of the Preferred Units. Certain redemption features embedded within the terms of the Preferred Units required bifurcation and measurement at fair value and are accounted for on the Company’s Condensed Consolidated Balance Sheet as a long-term liability embedded derivative. During the nine months ended September 30, 2022, the Company redeemed all outstanding Preferred Units. See discussion and additional detail in Note 11—Series A Cumulative Redeemable Preferred Units in the Notes to our Condensed Consolidated Financial Statements in this Form 10-Q. Equity Method Investments The Company follows the equity method of accounting when it does not exercise control over its equity interests, but can exercise significant influence over the operating and financial policies of the entity. Under this method, the equity investments are carried originally at acquisition cost, increased by the Company’s proportionate share of the equity interest’s net income and contributions made, and decreased by the Company’s proportionate share of the equity interest’s net losses and distributions received. The Company determines whether distributions are a return on or a return of the investment based on the nature of the distribution approach, under which the Company classifies distributions from an investee by evaluating the facts, circumstances and nature of each distribution. As distributions from the Company’s equity method investment (“EMI”) pipeline entities are generated from their respective normal course of business, the Company classifies the distributions as return on investments and as cash flow from operating activities. Please refer to Note 9—Equity Method Investments in the Notes to our Condensed Consolidated Financial Statements in this Form 10-Q, for further information of the Company’s equity method investments. Equity method investments acquired in the Transaction were recorded at fair value upon Closing. See discussion and additional detail in Note 2—Business Combination in the Notes to our Condensed Consolidated Financial Statements in this Form 10-Q for purchase price allocation of the Transaction. Inventory Other current assets include condensate, residue gas and NGLs inventories that are valued at the lower of cost or market. At the end of each reporting period, the Company assesses the carrying value of inventory and makes any adjustments necessary to reduce the carrying value to the applicable net realizable value. Inventory was valued at $13.1 million and $2.1 million as of September 30, 2022 and December 31, 2021, respectively. Impairment of Long-Lived Assets In accordance with Financial Accounting Standards Board (“FASB”) ASC 360, Property, Plant and Equipment, long-lived assets, excluding goodwill, to be held and used by the Company are reviewed for impairment annually or on an interim basis if events or circumstances indicate that the fair value of the assets have decreased below their carrying value. For long-lived assets to be held and used, the Company bases their evaluation on impairment indicators such as the nature of the assets, the future economic benefit of the assets, any historical or future profitability measurements and other external market conditions or factors that may be present. The Company’s management assesses whether there has been an impairment trigger, and if a trigger is identified, then the Company would perform an undiscounted cash flow test at the lowest level for which identifiable cash flows are independent of cash flows from other assets. If the sum of the undiscounted future net cash flows is less than the net book value of the property, an impairment loss is recognized for any excess of the property’s net book value over its estimated fair value. The Company did not recognize impairment losses for long-lived assets during the three and nine months ended September 30, 2022 and 2021. Transactions with Affiliates The accounts receivable from or payable to affiliates represent the net result of the Company’s monthly revenue, capital and operating expenditures, and other miscellaneous transactions to be settled with Apache and its subsidiaries, who controlled the Company prior to the Transaction. Accounts receivable from affiliates was $24.1 million as of September 30, 2022. Revenue from affiliates was $35.2 million and $81.4 million for the three and nine months ended September 30, 2022, respectively. Accrued expense due to affiliates was immaterial as of September 30, 2022, and operating expenses were $0.2 million and $0.5 million for the three and nine months ended September 30, 2022, respectively. In addition, the Company incurred cost of sales with two of its EMI pipeline entities, Permian Highway Pipeline LLC (“PHP”) and Breviloba, LLC (“Breviloba”). The Company paid a demand fee to PHP and paid a capacity fee to Breviloba for certain volumes moving on the Shin Oak NGL Pipeline. For the three and nine months ended September 30, 2022, the Company recorded cost of sales of $3.7 million and $10.8 million, respectively, with these affiliates. Net Income Per Share Basic net income per share is calculated by dividing net income attributable to Class A common shareholders by the weighted-average number of shares of Class A Common Stock outstanding during the period. Class C Common Stock is excluded from the weighted-average shares outstanding for the calculation of basic net income per share, as holders of Class C Common Stock are not entitled to any dividends or liquidating distributions. No net income per share was computed for the three and nine months ended September 30, 2021, as no Class A Common Stock was outstanding with respect to BCP as the accounting acquirer as of September 30, 2021. The Company uses the “if-converted method” to determine the potential dilutive effect of (i) an assumed exchange of outstanding Common Units (and the cancellation of a corresponding number of shares of outstanding Class C Common Stock) for shares of Class A Common Stock and (ii) an assumed exercise of the outstanding public and private warrants for shares of Class A Common Stock. The dilutive effect of any earn-out consideration payable in shares is only included in periods for which the underlying conditions for the issuance are met. Recently Adopted Accounting Pronouncement Effective January 1, 2022, the Company adopted ASU 2021-08 , Business Combinations (Topic 805), Accounting for Contract Assets and Contract Liabilities from Contracts with Customers (“ASU 2021-08”), which requires contract assets and contract liabilities (i.e., deferred revenue) acquired in a business combination to be recognized and measured by the acquirer on the acquisition date in accordance with ASC 606, Revenue from Contracts with Customers . Generally, this new guidance will result in the acquirer recognizing contract assets and contract liabilities at the same amounts recorded by the acquiree. Historically, such amounts were recognized by the acquirer at fair value. With adoption of ASU 2021-08, the Company assumed contract liabilities at carrying value of $9.1 million upon Closing. Effective January 1, 2022, the Company adopted ASU 2020-04, Reference Rate Reform (Topic 848) (“ASU 2020-04”) . ASU 2020-04 was issued to ease the potential accounting burden expected when global capital markets move away from LIBOR, the benchmark interest rate banks use to make short-term loans to each other. The amendments in this update provide optional expedients and exceptions for applying GAAP to contracts, hedging relationship, and other transactions affected by reference rate reform if certain criteria are met. Interest rate applied to the Company’s new Term Loan and Revolver borrowings resulting from the comprehensive refinance is based on Secured Overnight Financing Rate (“SOFR”), which is a broad measure of the cost of borrowing cash overnight collateralized by treasury securities. Refer to Note 6—Debt and Financing Costs in the Notes to our Condensed Consolidated Financial Statements of this Form 10-Q for discussion of SOFR applicable to the Company’s debt structures. Recent Accounting Pronouncement Not Yet Adopted In June 2022, the FASB issued ASU 2022-03, Fair Value Measurement (Topic 820): Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions (“ASU 2022-03”). The amendments in ASU 2022-03 clarify that a contractual restriction on the sale of an equity security is not considered part of the unit of account of the equity security and, therefore, is not considered in measuring fair value. The amendments also clarify that an entity cannot, as a separate unit of account, recognize and measure a contractual sale restriction. The amendments also require the following disclosures for equity securities subject to contractual sale restrictions: (1) The fair value of equity securities subject to contractual sale restrictions reflected in the balance sheet; (2) The nature and remaining duration of the restriction(s); (3) The circumstances that could cause a lapse in the restriction(s). This guidance is effective for public business entities for fiscal years beginning after December 15, 2023, and interim periods within those fiscal years. Early adoption is permitted for both interim and annual financial statements that have not yet been issued or made available for issuance. The Company is currently evaluating the effect that ASU 2022-03 will have on its Consolidated Financial Statements. In March 2022, the FASB issued ASU 2022-01, Derivatives and Hedging (Topic 815): Fair Value Hedging - Portfolio Layer Method (“ASU 2022-01”) . Current GAAP permits only prepayable financial assets and one or more beneficial interests secured by a portfolio of prepayable financial instruments to be included in a last-of-layer closed portfolio. The amendments in ASU 2022-01 allow nonprepayable financial assets also to be included in a closed portfolio hedged using the portfolio layer method. That expanded scope permits an entity to apply the same portfolio hedging method to both prepayable and nonprepayable financial assets, thereby allowing consistent accounting for similar hedges. The amendments in ASU 2022-01 also clarify the accounting for and promote consistency in the reporting of hedge basis adjustments applicable to both a single hedged layer and multiple hedged layers as follows: (1) an entity is required to maintain basis adjustments in an existing hedge on a closed portfolio basis (that is, not allocated to individual assets), (2) an entity is required to immediately recognize and present the basis adjustment associated with the amount of the designated layer that was breached in interest income. In addition, an entity is required to disclose that amount and the circumstances that led to the breach, (3) an entity is required to disclose the total amount of the basis adjustments in existing hedges as a reconciling amount if other areas of GAAP require the disaggregated disclosure of the amortized cost basis of assets included in the closed portfolio, and (4) an entity is prohibited from considering basis adjustments in an existing hedge when determining credit losses. The guidance is effective for public business entities for fiscal years beginning after December 15, 2022, and interim periods within those fiscal years. Early adoption is permitted on any date on or after the issuance of ASU 2022-01 for any entity that has adopted the amendments in ASU 2017-02 for the corresponding period. The Company is currently evaluating the effect that ASU 2022-01 will have on its Consolidated Financial Statements. |
BUSINESS COMBINATION
BUSINESS COMBINATION | 9 Months Ended |
Sep. 30, 2022 | |
Business Combinations [Abstract] | |
BUSINESS COMBINATION | BUSINESS COMBINATION Altus Business Combination On February 22, 2022, the Company consummated the previously announced business combination transactions contemplated by the Contribution Agreement, dated as of October 21, 2021. Pursuant to the Contribution Agreement, in connection with the Closing, (i) Contributor contributed all of the equity interests of the Contributed Entities to the Partnership; and (ii) in exchange for such contribution, the Partnership transferred to Contributor 50,000,000 common units representing limited partner interests in the Partnership and 50,000,000 shares of the Company’s Class C Common Stock, par value $0.0001 per share. Please refer to “The Transaction” discussed above. The Transaction was accounted as a reverse merger in accordance with ASC 805, which, among other things, requires assets acquired and liabilities assumed to be measured at their acquisition date fair value. The Company also adopted ASU 2021-08, effective as of January 1, 2022, to record contract liabilities at their carrying value as of the acquisition date. Although the Company was the legal acquirer, BCP was determined to be the accounting acquirer and legal acquiree. As a result, BCP and its subsidiaries’ net assets were carried at historical value, acquired net assets were measured at fair value except contract liabilities being recorded at carrying value at the acquisition date, and results of operations of ALTM and its subsidiaries were included in the Company’s Condensed Consolidated Financial Statements from the Closing Date going forward. The preliminary purchase price allocation is based on an assessment of the fair value of the assets acquired and liabilities assumed in the acquisition using inputs that are not observable in the market and thus Level 3 inputs. The fair value of the processing plant, gathering system and related facilities and equipment are based on market and cost approaches. The goodwill of $4.6 million relates to operational synergies and is included in the Midstream Logistics segment. The value of the Preferred Units and assumed contingent liability is determined through a probability-weighted analysis of the expected future cash flows and other applicable valuation techniques. See additional details for Preferred Units in Note 11—Series A Cumulative Redeemable Preferred Units and contingent liabilities in Note 8—Commitments and Contingencies in the Notes to our Condensed Consolidated Financial Statements in this Form 10-Q. Certain data necessary to complete the purchase price allocation is not yet available, including, but not limited to, valuation of the underlying assets of the equity method investments and liabilities assumed. However, the Company is continuing its review of these matters during the measurement period, and if new information obtained about facts and circumstances that existed at the acquisition date identifies adjustments to the liabilities initially recognized, as well as any additional liabilities that existed at the acquisition date, the acquisition accounting will be revised to reflect the resulting adjustments to the provisional amounts initially recognized. The Company will finalize the purchase price allocation during the 12-month period following the acquisition date. The following table summarizes the preliminary estimated fair value of assets acquired and liabilities assumed in the Transaction in accordance with ASC 805: (In thousands) Amount Cash and cash equivalent $ 13,401 Accounts receivable 1,919 Accounts receivable - affiliates 15,681 Property, plant, and equipment, net 634,923 Intangible assets, net 13,200 Investments in unconsolidated affiliates 1,755,000 Prepaid expense and other assets 7,748 Goodwill 4,557 Total assets acquired 2,446,429 Accrued expenses and other accrued liabilities 5,687 Long-term debt 657,000 Embedded derivative liabilities 89,050 Contract liabilities 9,102 Mandatory redeemable Preferred Units 200,667 Deferred tax liabilities 4,010 Contingent liabilities 4,451 Total liabilities assumed 969,967 Redeemable noncontrolling interest - Preferred Unit limited partners 462,717 Total consideration transferred $ 1,013,745 The Company incurred acquisition-related costs of $0.1 million and $6.4 million for the three and nine months ended September 30, 2022, respectively. Supplemental Pro Forma Information The unaudited supplemental pro forma financials are for informational purposes only and are not indicative of future results. The results below for the three and nine months ended September 30, 2022 and 2021 combine the results of the Company and the Partnership, giving effect to the Transaction as if it had been completed on January 1, 2021. Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 (In thousands) Pro forma Pro forma Pro forma Pro forma Revenues $ 325,176 $ 201,134 $ 944,850 $ 554,742 Net income including noncontrolling interest $ 46,968 $ 28,518 $ 193,083 $ 64,165 |
REVENUE RECOGNITION
REVENUE RECOGNITION | 9 Months Ended |
Sep. 30, 2022 | |
Revenue from Contract with Customer [Abstract] | |
REVENUE RECOGNITION | REVENUE RECOGNITION Disaggregation of Revenue The following table presents a disaggregation of the Company’s revenue: Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 (In thousands) Gathering and processing services $ 107,597 $ 72,578 $ 290,122 $ 202,482 Natural gas, NGLs and condensate sales 213,803 93,266 618,382 244,358 Other revenue 3,776 742 9,493 3,615 Total revenues and other $ 325,176 $ 166,586 $ 917,997 $ 450,455 There have been no significant changes to the Company’s contracts with customers during the three and nine months ended September 30, 2022. Contracts with customers acquired through the Transaction had similar structures as the Company’s existing contracts with customers. The Company recognized revenues from minimum volume commitment (“MVC”) deficiency payments of $0.7 million and nil for the three months ended September 30, 2022 and 2021, respectively, and $1.0 million and $2.5 million for the nine months ended September 30, 2022 and 2021, respectively. Remaining Performance Obligations The following table presents our estimated revenue from contracts with customers for remaining performance obligations that has not yet been recognized, representing our contractually committed revenues as of September 30, 2022: Amount Fiscal Year (In thousands) Remaining of 2022 $ 2,151 2023 44,597 2024 40,247 2025 47,898 2026 34,631 Thereafter 191,293 $ 360,817 Our contractually committed revenue, for purposes of the tabular presentation above, is generally limited to customer contracts that have fixed pricing and fixed volume terms and conditions, generally including contracts with payment obligations associated with MVCs. Contract Liabilities The following table provides information about contract liabilities from contracts with customers as of September 30, 2022: Amount (In thousands) Balance at December 31, 2021 $ 14,756 Reclassification of beginning contract liabilities to revenue as a result of performance obligation being satisfied (5,159) Cash received and not recognized as revenue 20,268 Balance at September 30, 2022 29,865 Less: Current portion 7,158 Non-current portion $ 22,707 Contract liabilities relate to payments received in advance of satisfying performance obligations under a contract, which result from contribution in aid of construction payments. Current and noncurrent contract liabilities are included in “Other Current Liabilities” and “Contract Liabilities,” respectively, of the Condensed Consolidated Balance Sheets. Contract Cost Assets The Company has capitalized certain costs incurred to obtain a contract that would not have been incurred if the contract had not been obtained. These costs are recovered through the net cash flows of the associated contract. As of September 30, 2022 and December 31, 2021, the Company had contract acquisition cost assets of $15.3 million and $18.4 million, respectively. Current and noncurrent contract cost assets are included in “Prepaid and Other Current Assets” and “Deferred Charges and Other Assets,” respectively, of the Condensed Consolidated Balance Sheets. The Company amortizes these assets as cost of sales on a straight-line basis over the life of the associated long-term customer contract. The Company recognized cost of sales associated with these assets of $0.4 million and $0.4 million for the three months ended September 30, 2022 and 2021, respectively, and $1.3 million and $1.8 million for the nine months ended September 30, 2022 and 2021, respectively. |
PROPERTY, PLANT AND EQUIPMENT
PROPERTY, PLANT AND EQUIPMENT | 9 Months Ended |
Sep. 30, 2022 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY, PLANT AND EQUIPMENT | PROPERTY, PLANT AND EQUIPMENT Property, plant and equipment are carried at cost or fair market value at the date of acquisition less accumulated depreciation. The cost basis of constructed assets includes materials, labor, and other direct costs. Major improvements or betterment are capitalized, while repairs that do not improve the life of the respective assets are expensed as incurred. Depreciation and amortization are computed using the straight-line method over the estimated useful lives of the assets. Property, plant and equipment, at carrying value, is as follows: September 30, 2022 December 31, 2021 (In thousands) Gathering, processing and transmission systems and facilities $ 2,850,062 $ 2,121,434 Vehicles 8,026 6,090 Computers and equipment 4,255 4,271 Less: accumulated depreciation (437,049) (337,030) Total depreciable assets, net 2,425,294 1,794,765 Construction in progress 82,834 24,888 Land 20,531 19,626 Total property, plant and equipment, net $ 2,528,659 $ 1,839,279 The cost of property classified as “Construction in progress” is excluded from capitalized costs being depreciated. These amounts represent property that is not yet available to be placed into productive service as of the respective reporting date. The Company recorded $34.9 million and $26.8 million of depreciation expense for the three months ended September 30, 2022 and 2021, respectively, and $102.4 million and $79.0 million of depreciation expense for the nine months ended September 30, 2022 and 2021, respectively. |
GOODWILL AND INTANGIBLE ASSETS,
GOODWILL AND INTANGIBLE ASSETS, NET | 9 Months Ended |
Sep. 30, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
GOODWILL AND INTANGIBLE ASSETS, NET | GOODWILL AND INTANGIBLE ASSETS, NET Goodwill The Company closed a business combination transaction on February 22, 2022, refer to the Transaction in Note 2—Business Combination in the Notes to our Condensed Consolidated Financial Statements in this Form 10-Q. The Transaction was accounted for as a business combination pursuant to ASC 805. In connection with the Transaction, the Company recorded excess of the purchase price over net assets acquired as goodwill. The Company recorded goodwill of $4.6 million as of September 30, 2022. Goodwill is tested at least annually as of December 31 of each year, or more frequently as events occur or circumstances change that would more-likely-than-not reduce fair value of a reporting unit below its carrying value. Company’s management assesses whether there have been events or circumstances that trigger the fair value of the reporting unit to be lower than its net carrying value since consummation of the Transaction and concluded that goodwill was not impaired as of September 30, 2022. Intangible Assets Intangible assets, net are comprised of the following: September 30, 2022 December 31, 2021 (In thousands) Customer contracts $ 1,136,728 $ 1,135,963 Right of way assets 125,164 99,345 Less accumulated amortization (539,501) (449,259) Total amortizable intangible assets, net $ 722,391 $ 786,049 The fair value of acquired customer contracts was capitalized as a result of acquiring favorable customer contracts as of the closing dates of certain past acquisitions and is being amortized using a straight-line method over the remaining term of the customer contracts, which range from one The Company recorded $30.1 million and $30.4 million of amortization expense for the three months ended September 30, 2022 and 2021, respectively, and $90.2 million and $91.3 million of amortization expense for the nine months ended September 30, 2022 and 2021, respectively. There was no impairment recognized on intangible assets for the three and nine months ended September 30, 2022 and 2021. |
DEBT AND FINANCING COSTS
DEBT AND FINANCING COSTS | 9 Months Ended |
Sep. 30, 2022 | |
Debt Disclosure [Abstract] | |
DEBT AND FINANCING COSTS | DEBT AND FINANCING COSTS June 2030 Senior Notes On June 8, 2022, the Partnership completed a private placement of $1.00 billion aggregate principal amount of its 5.875% Sustainability-Linked Senior Notes due 2030 (the “Notes”), which are fully and unconditionally guaranteed by the Company. The Notes were issued at 99.588% of their face amount and will mature on June 15, 2030. Interest accrues from June 8, 2022 and is payable semi-annually on June 15 and December 15 of each year, commencing December 15, 2022. The aggregate fees, expenses, and original issue discount paid to obtain the Notes totaled $21.5 million and were capitalized as debt issuance cost and included in the Condensed Consolidated Balance Sheets as a direct deduction to the Notes as the Notes were transferred to third-party investors that pay the stated principal amount without deduction for the initial purchasers’ discount. On or after June 15, 2027, the interest rate accruing on the Notes will be increased by an additional 0.250% per annum unless the Partnership satisfies, and an independent external verifier confirms satisfaction of the Sustainability Performance Targets (“SPT”) as defined in the indenture governing the Notes related to the three key performance indicators outlined in the Sustainability-Linked Financing Framework published by the Company on May 16, 2022: 1) Scope 1 and Scope 2 greenhouse gas emissions intensity, 2) Scope 1 and Scope 2 methane gas emissions intensity and 3) female representation in corporate officer positions. The interest rate accruing on the Notes will be increased by an additional 0.083% per annum for each SPT which has not been satisfied and externally verified. The Partnership may redeem some or all of the Notes at any time or from time to time prior to maturity based on terms prescribed in the Notes. Revolving Credit Facility On June 8, 2022, the Partnership entered into a revolving credit agreement (the “RCA”) among Bank of America, N.A., as administrative agent (“Bank of America”), and the banks and other financial institutions party thereto, as lenders. The RCA provides for a $1.25 billion senior unsecured revolving credit facility (the “Revolving Credit Facility”). The Partnership may prepay borrowings under the Revolving Credit Facility at any time without premium or penalty (other than customary SOFR breakage costs), subject to certain notice requirements. All borrowings under the Revolving Credit Facility mature on June 8, 2027. The obligations under the RCA are fully and unconditionally guaranteed by the Company. The RCA provides for borrowings of either, at the Partnership’s option, base rate loans or term SOFR loans. Base rate loans bear interest at a rate per annum equal to the greatest of (a) the prime rate as announced from time to time by Bank of America, (b) the greater of (i) the federal funds effective rate and (ii) the overnight bank funding rate, plus 1/2 of 1.00% and (c) the adjusted term SOFR rate for an interest period of one month plus 1.00%, plus a margin that ranges between 0.25% and 1.00%, depending on the credit rating of the Partnership. SOFR loans bear interest at a rate per annum equal to the term SOFR rate for such interest periods plus 0.10%, plus a margin that ranges between 1.25% and 2.00%, depending on the credit rating of the Partnership. In obtaining the RCA, the Partnership incurred fees and expenses totaling $7.8 million, which was capitalized and included in the Condensed Consolidated Balance Sheets as “Deferred charges and other assets.” In addition, the Partnership is required to pay to each lender a commitment fee on the daily unfunded amount of such lender’s revolving commitment, which accrues at a rate that ranges between 0.15% and 0.35% depending on the credit rating of the Partnership. Term Loan Credit Facility On June 8, 2022, concurrently with the closing of the Revolving Credit Facility, the Partnership entered into a term loan credit agreement (the “TLA”) among PNC Bank, National Association, as administrative agent (“PNC Bank”), and the banks and other financial institutions party thereto, as lenders. The TLA provides for a $2.00 billion senior unsecured term loan credit facility (the “Term Loan Credit Facility”). The TLA matures on June 8, 2025. The obligations under the TLA are fully and unconditionally guaranteed by the Company. The TLA provides for borrowings of either, at the Partnership’s option, base rate loans or term SOFR loans. Base rate loans bear interest at a rate per annum equal to the greatest of (a) the prime rate as announced from time to time by PNC Bank, (b) the greater of (i) the federal funds effective rate and (ii) the overnight bank funding rate, plus 1/2 of 1.00% and (c) the adjusted term SOFR rate for an interest period of one month plus 1.00%, plus a margin that ranges between 0.25% and 1.0%, depending on the credit rating of the Partnership. SOFR loans bear interest at a rate per annum equal to the term SOFR rate for such interest periods plus 0.10%, that if the plus a margin that ranges between 1.25% and 2.0%, depending on the credit rating of the Partnership. In obtaining the TLA, the Partnership incurred fee and expenses totaled $7.6 million, which was capitalized as debt issuance cost and included in the Condensed Consolidated Balance Sheets as a direct deduction to the Term Loan Credit Facility. Both the RCA and the TLA contain a “Sustainability Adjustments” feature that could result in a 0.05% increase or reduction to the effective interest rate, dependent upon the Company’s meeting certain sustainability targets after 2022. “Sustainability Rate Adjustment” means, with respect to any KPI Metrics Report, for any period between Sustainability Pricing Adjustment Dates, (a) positive 0.05%, if neither of the Sustainability Performance Targets (as defined in the RCA and TLA) as set forth in the KPI Metrics Report have been satisfied for the relevant calendar year, (b) 0.00% if only one of the Sustainability Performance Targets as set forth in the KPI Metrics Report has been satisfied for the relevant calendar year and (c) negative 0.05% if both of the Sustainability Performance Targets as set forth in the KPI Metrics Report have been satisfied for the relevant calendar year; provided that, in each case, if the Partnership subsequently issues a sustainability-linked debt instrument linked to the same KPI Metric and with an observation date for such calendar year, but with a higher percentage of representation or reduction, as the case may be, the relevant Sustainability Performance Target shall be automatically adjusted upward to equal the percentage of representation or reduction, as applicable, required by such subsequent sustainability-linked debt instrument. “Sustainability Performance Targets” in the RCA and TLA mean, for any calendar year, with respect to (a) the Female Representation KPI, the target percentage of female representation in corporate officer positions for such calendar year and (b) the Methane Emissions KPI, the percentage reduction in methane gas emissions intensity relative to the baseline year for such calendar year. Both the RCA and the TLA contain customary covenants and restrictive provisions which may, among other things, limit Partnership’s ability to create liens, incur additional indebtedness, make restricted payments, or liquidate, dissolve, consolidate with, or merge into or with any other person. As of September 30, 2022, the Partnership was in compliance with all customary and financial covenants. Repayment of Existing Credit Facilities In June 2022, the Company used the net proceeds from the Notes, together with cash on hand and proceeds from the Term Loan Credit Facility, to repay all outstanding borrowings under its existing credit facilities and to pay certain related fees and expenses. In conjunction with the extinguishment of existing outstanding borrowings, the Company recognized a loss on extinguishment of debt of approximately $28.0 million. In addition, the unamortized debt issuance costs related to the existing outstanding borrowings were fully amortized and included in the loss on debt extinguishment calculation for the three and nine months ended September 30, 2022. The fair value of the Company and its subsidiaries’ consolidated debt as of September 30, 2022 and December 31, 2021 was $3.02 billion and $2.34 billion, respectively. At September 30, 2022, the Notes’ fair value was based on Level 1 inputs and the Term Loan Credit Facility and Revolver Credit Facility’s fair value was based on Level 3 inputs. The following table summarizes the Company’s debt obligations as of September 30, 2022 and December 31, 2021: September 30, 2022 December 31, 2021 (In thousands) $2.0 billion unsecured term loan $ 2,000,000 $ — $1.0 billion 2030 senior unsecured Notes 1,000,000 — $1.25 billion revolving credit facility 475,000 — $1.25 billion term loan — 1,175,417 $690 million term loan — 639,393 $513 million term loan — 479,377 $125 million revolving line of credit — 52,000 Total Long-term debt 3,475,000 2,346,187 Less: Debt issuance costs, net (1) (27,487) (38,485) 3,447,513 2,307,702 Less: Current portion, net — (54,280) Long-term portion of debt and finance lease obligations, net $ 3,447,513 $ 2,253,422 (1) Excluded unamortized debt issuance cost related to the Revolving Credit Facility. Unamortized debt issuance cost associated with the Revolving Credit Facility was $7.3 million and $2.2 million as of September 30, 2022 and December 31, 2021, respectively, and were included in the “Deferred charges and other assets” of the Condensed Consolidated Balance Sheets. The table below presents the components of the Company’s financing costs, net of capitalized interest: Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 (In thousands) Capitalized interest $ 961 $ 226 $ 1,262 $ 712 Debt issuance costs 1,515 3,354 8,053 9,991 Interest expense 37,988 26,961 83,270 77,755 Total financing costs, net of capitalized interest $ 40,464 $ 30,541 $ 92,585 $ 88,458 As of September 30, 2022 and December 31, 2021, unamortized debt issuance costs associated with the Notes and the Term Loan Credit Facility were $27.5 million and $38.5 million, respectively. As of September 30, 2022 and December 31, 2021, unamortized debt issuance costs associated with the new and existing revolving credit facilities were $7.3 million and $2.2 million, respectively. As of September 30, 2022, the unamortized debt issuance costs associated with the new revolving credit facilities were included in the “Deferred charges and other assets” of the Condensed Consolidated Balance Sheets. As of December 31, 2021, the current and non-current portion of the unamortized debt issuance costs were included in the “Other non-current assets” and “Deferred charges and other assets” of the Condensed Consolidated Balance Sheets. The amortization of the debt issuance costs was charged to interest expense for the periods presented. The amount of debt issuance costs included in interest expense was $1.5 million and $3.4 million for the three months ended September 30, 2022 and 2021, respectively, and $8.1 million and $10.0 million for the nine months ended September 30, 2022 and 2021, respectively. |
ACCRUED EXPENSES
ACCRUED EXPENSES | 9 Months Ended |
Sep. 30, 2022 | |
Payables and Accruals [Abstract] | |
ACCRUED EXPENSES | ACCRUED EXPENSES The following table provides detail of the Company’s accrued expenses at September 30, 2022 and December 31, 2021: September 30, 2022 December 31, 2021 (In thousands) Accrued product purchases $ 175,575 $ 118,364 Accrued taxes 19,442 4,299 Accrued salaries, vacation, and related benefits 4,616 2,113 Accrued capital expenditures 8,713 2,995 Accrued interest expenses 19,120 — Accrued other expenses 7,694 7,872 Total accrued expenses $ 235,160 $ 135,643 Accrued product purchases mainly consisted of accrued gas estimates as of September 30, 2022. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 9 Months Ended |
Sep. 30, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES Accruals for loss contingencies arising from claims, assessments, litigation, environmental, and other sources are recorded when it is probable that a liability has been incurred and the amount can be reasonably estimated. These accruals are adjusted as additional information becomes available or circumstances change. As of September 30, 2022 and December 31, 2021, there were no accruals for loss contingencies. Litigation The Company is a party to various legal actions arising in the ordinary course of its businesses. In accordance with ASC 450, Contingencies , the Company accrues reserves for outstanding lawsuits, claims, and proceedings when a loss contingency is probable and can be reasonably estimated. The Company estimates the amount of loss contingencies using current available information from legal proceedings, advice from legal counsel and available insurance coverage. Due to the inherent subjectivity of the assessments and unpredictability of the outcomes of the legal proceedings, any amounts accrued or included in this aggregate amount may not represent the ultimate loss to the Company from the legal proceedings in question. Thus, the Company’s exposure and ultimate losses may be higher, and possibly significantly more, than the amounts accrued. The Company has entered into litigation with two third parties to collect outstanding receivables totaling $19.6 million that remain outstanding from the Winter Storm Uri during February of 2021. Given the counterparties’ sufficient creditworthiness and the valid claims that we hold, no allowance has currently been established for these items as we have legally enforceable agreements with these parties. Environmental Matters As an owner of infrastructure assets with rights to surface lands, the Company is subject to various local and federal laws and regulations relating to discharge of materials into, and protection of, the environment. These laws and regulations may, among other things, impose liability on the Company for the cost of pollution clean-up resulting from operations and subject the Company to liability for pollution damages. The Company is not aware of any environmental claims existing as of September 30, 2022, that have not been provided for or would otherwise have a material impact on its financial position, results of operations, or liquidity. Contingent Liabilities Permian Gas Acquisition As part of the acquisition of Permian Gas on June 11, 2019, consideration included a contingent liability arrangement with PDC Permian, Inc. (“PDC”). The arrangement requires additional monies to be paid by the Company to PDC on a per Mcf basis if the actual annual Mcf volume amounts exceed forecasted annual Mcf volume amounts starting in 2020 and continuing through 2029. The arrangement defines the incentive rate per Mcf for each qualifying year and the total monies paid under this arrangement are capped at $60.5 million. Amounts are payable on an annual basis over the earn-out period. The fair value of the contingent liability recognized on the acquisition date of $3.9 million was estimated utilizing the following key assumptions: (1) present value factors based on the Company’s weighted-average cost of capital, 2) a probability weighted payout based on an estimate of future volumes and (3) a discount period consistent with the arrangement’s life and the respective due dates of the potential future payments. Based on current forecasts and discussions with PDC, management revalued this contingent liability with updated assumptions at each reporting period. The Company did not expect PDC’s actual annual Mcf volume amounts to exceed forecasted amounts as of September 30, 2022; therefore, the estimated fair value of the contingent consideration liability was nil as of September 30, 2022. The estimated fair value of the contingent consideration liability related to this acquisition was $0.8 million as of December 31, 2021. Original Altus Transaction As part of the Transaction, the Company assumed contingent liabilities of $4.5 million related to earn-out consideration of up to 2,500,000 shares of Class A Common Stock, which was part of the original Altus transaction, as follows: • 1,250,000 shares if the per share closing price of the Class A Common Stock as reported by the New York Stock Exchange (“NYSE”) during any 30-trading-day period ending prior to November 9, 2023 is equal to or greater than $140.00 for any 20 trading days within such 30-trading-day period. • 1,250,000 shares if the per share closing price of the Class A Common Stock as reported by the NYSE during any 30-trading-day period ending prior to November 9, 2023 is equal to or greater than $160.00 for any 20 trading days within such 30-trading-day period. Pursuant to ASC 805, this earn-out consideration was a pre-existing contingency and accounted for as an assumed liability to the acquirer on the acquisition date. Immediately subsequent to the Closing, the Company evaluated the earn-out consideration classification in accordance with ASC 480, Distinguishing Liabilities from Equity ( “ASC 480” ) and ASC 815, Derivatives and Hedging ( “ASC 815” ). |
EQUITY METHOD INVESTMENTS
EQUITY METHOD INVESTMENTS | 9 Months Ended |
Sep. 30, 2022 | |
Equity Method Investments and Joint Ventures [Abstract] | |
EQUITY METHOD INVESTMENTS | EQUITY METHOD INVESTMENTS As of September 30, 2022, the Company owned investments in the following long-haul pipeline entities in the Permian Basin. These investments were accounted for using the equity method of accounting. For each EMI pipeline entity, the Company has the ability to exercise significant influence based on certain governance provisions and its participation in the significant activities and decisions that impact the management and economic performance of the EMI pipeline. The table below presents the ownership percentages and investment balances held by the Company for each entity: Ownership September 30, 2022 December 31, 2021 (In thousands) Permian Highway Pipeline LLC (1) 53.3% $ 1,459,096 $ 626,477 Breviloba, LLC (Shin Oak) 33.0% 462,691 — Gulf Coast Express Pipeline LLC 16.0% 450,809 — $ 2,372,596 $ 626,477 (1) Ownership for PHP was 53.3% and 26.7% as of September 30, 2022 and December 31, 2021, respectively. Additionally, as of September 30, 2022, the Company also owned 15.0% of Epic Crude Holdings, LP (“EPIC”). However, no dollar value was assigned through the purchase price allocation as adjustment was made to eliminate equity in losses of EPIC. No additional contribution was made to EPIC and no distribution or equity income was received from EPIC during the three and nine months ended September 30, 2022. As of September 30, 2022, the unamortized basis differences included in the EMI pipelines balances were $349.8 million. There was no unamortized basis difference as of December 31, 2021. These amounts represent differences in the Company’s contributions to date and the Company’s underlying equity in the separate net assets within the financial statements of the respective entities. Unamortized basis differences will be amortized into equity income over the useful lives of the underlying pipeline assets. There was capitalized interest of $12.5 million and $12.8 million as of September 30, 2022 and December 31, 2021, respectively. Capitalized interest is amortized on a straight-line basis into equity income. The following table presents the activity in the Company’s EMIs for the nine months ended September 30, 2022: Permian Highway Pipeline LLC Breviloba, LLC Gulf Coast Express Pipeline LLC Total (2) (In thousands) Balance at December 31, 2021 $ 626,477 $ — $ — $ 626,477 Acquisitions 815,000 470,000 470,000 1,755,000 Contributions 56,199 — — 56,199 Distributions (125,526) (25,810) (34,450) (185,786) Equity income, net (1) 86,946 18,501 15,259 120,706 Balance at September 30, 2022 $ 1,459,096 $ 462,691 $ 450,809 $ 2,372,596 (1) For the nine months ended September 30, 2022, net of amortization of basis differences and capitalized interests, which represents undistributed earnings, the amortization was $5.3 million from Permian Highway Pipeline LLC, $0.5 million from Breviloba, LLC and $10.4 million from Gulf Coast Express Pipeline, LLC. (2) The EMIs acquired in the Transaction are included in the results from February 22, 2022 to September 30, 2022, and this is also the case for the additional 26.67% of PHP that was acquired in the Transaction. The results of the legacy ALTM business are not included in the Company’s consolidated financials prior to February 22, 2022. Refer to Note 1—Description of the Organization and Summary of Significant Accounting Policies in the Notes to our Condensed Consolidated Financial Statements of this Form 10-Q, for further information on the Company’s basis of presentation . Summarized Financial Information The following tables represent selected statement of operations data for the Company’s EMI pipelines (on a 100 percent basis) for the three and nine months ended September 30, 2022 and 2021. Three Months Ended September 30, 2022 2021 Permian Highway Pipeline LLC Breviloba, LLC Gulf Coast Express Pipeline LLC Permian Highway Pipeline LLC (1) Breviloba, LLC (1) Gulf Coast Express Pipeline LLC (1) (In thousands) Revenues $ 100,114 $ 53,120 $ 91,800 $ 99,918 $ 45,054 $ 91,454 Operating income 69,851 22,205 70,870 61,987 26,796 65,482 Net income 69,926 22,060 70,742 61,753 26,617 65,145 Nine Months Ended September 30, 2022 2021 Permian Highway Pipeline LLC Breviloba, LLC Gulf Coast Express Pipeline LLC Permian Highway Pipeline LLC (1) Breviloba, LLC (1) Gulf Coast Express Pipeline LLC (1) (In thousands) Revenues $ 296,779 $ 151,732 272,542 $ 297,132 $ 127,030 $ 270,526 Operating income 190,620 73,877 199,130 167,011 72,098 186,356 Net income 190,446 73,711 198,732 166,662 71,621 185,464 (1) For the three and nine months ended September 30, 2021, the Company only had equity interest in Permian Highway Pipeline LLC. |
EQUITY AND WARRANTS
EQUITY AND WARRANTS | 9 Months Ended |
Sep. 30, 2022 | |
Equity [Abstract] | |
EQUITY AND WARRANTS | EQUITY AND WARRANTS Redeemable Noncontrolling Interest — Common Unit Limited Partners On February 22, 2022, the Company consummated the Transaction. Pursuant to the Contribution Agreement, in connection with the Closing, (i) Contributor contributed all of the equity interests of the Contributed Entities to the Partnership; and (ii) in exchange for such contribution, the Partnership transferred to Contributor 50,000,000 common units representing limited partner interests in the Partnership and 50,000,000 shares of the Company’s Class C Common Stock, par value $0.0001 per share. Please refer to “The Transaction” above. The redemption option of the Common Unit is not legally detachable or separately exercisable from the instrument and is non-transferable, and the Common Unit is redeemable at the option of the holder. Therefore, the Common Unit is accounted for as redeemable noncontrolling interest and classified as temporary equity on the Company’s Condensed Consolidated Balance Sheet. During the first nine months of 2022, 5,730,000 common units were redeemed on a one-for-one basis for shares of Class A Common Stock and a corresponding number of shares of Class C Common Stock were cancelled. There were 94,270,000 Common Units and an equal number of Class C Common Stock issued and outstanding as of September 30, 2022. The Common Units fair value was approximately $3.06 billion as of September 30, 2022. Redeemable Noncontrolling Interest — Preferred Unit Limited Partners Upon Closing, the Company assumed certain Preferred Units that were issued and outstanding on acquisition date. The Company has redeemed all assumed Preferred Units since the Closing. Refer to Note 11—Series A Cumulative Redeemable Preferred Units for further discussion. Public Warrants As of September 30, 2022, there were 12,577,350 Public Warrants (as defined below) outstanding. Each whole public warrant entitles the holder to purchase one tenth of a share of Class A Common Stock at a price of $115.00 per share (the “Public Warrants”). The Public Warrants will expire on November 9, 2023 or upon redemption or liquidation. The Company may call the Public Warrants for redemption, in whole and not in part, at a price of $0.01 per warrant with not less than 30 days’ notice provided to the Public Warrant holders. However, this redemption right can only be exercised if the reported last sale price of the Class A Common Stock equals or exceeds $180.00 per share for any 20-trading days within a 30-trading day period ending three business days prior to sending the notice of redemption to the Public Warrant holders. Private Placement Warrants As of September 30, 2022, there were 6,364,281 Private Placement Warrants (as defined below) outstanding, of which Apache holds 3,182,140. The private placement warrants will expire on November 9, 2023 and are identical to the Public Warrants discussed above, except (i) they will not be redeemable by the Company so long as they are held by the initial holders or their respective permitted transferees and (ii) they may be exercised by the holders on a cashless basis (the “Private Placement Warrants” and, together with the Public Warrants, the “Warrants”). The Company recorded a fair value of $0.1 million for the Public Warrants and a fair value of $0.1 million for the Private Warrants as of September 30, 2022 on the Condensed Consolidated Balance Sheet in other non-current liabilities. Refer to Note 15—Fair Value Measurement in the Notes to our Condensed Consolidated Financial Statements in this Form 10-Q for additional discussion regarding valuation of the Warrants. Dividend On February 22, 2022, the Company entered into a Dividend and Distribution Reinvestment Agreement (the “Reinvestment Agreement”) with certain stockholders including BCP Raptor Aggregator, LP, BX Permian Pipeline Aggregator, LP, Buzzard Midstream LLC, APA Corporation Apache Midstream LLC, and certain individuals (each, a “Reinvestment Holder”). Under the Reinvestment Agreement, each Reinvestment Holder is obligated to reinvest at least 20% of all distributions on Common Units or dividends on shares of Class A Common Stock in the Company’s Class A Common Stock. Additionally, the Audit Committee and subsequently the Company’s Board of Directors (the “Board”) resolved that for the calendar year 2022, 100% of all distributions or dividends received by each Reinvestment Holder would be reinvested in newly issued shares of Class A Common Stock. As described in these Condensed Consolidated Financial Statements, as the context requires, dividends paid to holders of Class A Common Stock and distributions paid to holders of Common Units may be referred to collectively as “dividends.” During the nine months ended September 30, 2022, the Company made cash dividend payments of $25.3 million to holders of Class A Common Stock and Common Units and $175.5 million was reinvested in shares of Class A Common Stock by Reinvestment Holders. On October 19, 2022, the Board declared a cash dividend of $0.75 per share on the Company’s Class A Common Stock and a distribution of $0.75 per Common Unit from the Partnership to the holders of Common Units. Dividends are payable on November 17, 2022. Certain holders of Class A Common Stock and Class C Common Stock will receive a cash dividend with the balance receiving additional shares of Class A Common Stock under the Reinvestment Agreement. Stock Split On May 19, 2022, the Company announced that its Board approved and declared a two-for-one stock split with respect to its Class A Common Stock and Class C Common Stock, in the form of a stock dividend (the “Stock Split”). The Stock Split was accomplished by distributing one additional share of Class A Common Stock for each share of Class A Common Stock outstanding and one additional share of Class C Common Stock for each share of Class C Common Stock outstanding. The additional shares of Common Stock were issued on June 8, 2022 to holders of record at the close of business on May 31, 2022. All corresponding per-share and share amounts, excluding the Transaction, for periods prior to June 8, 2022 have been retroactively restated in this Form 10-Q to reflect the Stock Split. Prior to the Closing Date of the Transaction, the Partnership had 625,000 Preferred Units issued and outstanding. Immediately prior to the Closing, on February 22, 2022, the Partnership redeemed for cash, 100,000 Preferred Units in an amount equal to approximately $120.1 million. The Company assumed the remaining 525,000 Preferred Units as well as 29,983 paid-in-kind (“PIK”) Preferred Units that were issued and outstanding at the closing of the Transaction. At the close, 150,000 preferred units and 8,567 associated PIK units became mandatorily redeemable and liability classified with the balance of preferred units remaining unchanged and classified as redeemable noncontrolling interest. The Company redeemed 125,000 mandatorily redeemable preferred units during the first two quarters of 2022 with the balance of mandatorily redeemable preferred units being redeemed during July for $30.7 million. In July 2022, the Company redeemed all outstanding redeemable noncontrolling interest Preferred Units for an aggregate $461.5 million. The excess of the carrying amount of the redeemable noncontrolling interest Preferred units immediately prior to redemption over redemption price was included in “Retained Earnings” in the Condensed Consolidated Balance Sheets. Activities related to Preferred Units for the nine months ended September 30, 2022 are as follows: Units Outstanding Amount (In thousands, except for unit data) Redeemable noncontrolling interest — Preferred Units, immediately upon Closing of Transaction (1) 396,417 $ 462,717 Redemption, including PIK units (396,417) (461,460) Cash distribution paid to Preferred Unit limited partners — (6,937) Allocation of net income — 18,128 Accreted redemption value adjustment — 97,075 Excess of carrying amount over redemption price — (109,523) Redeemable noncontrolling interest — Preferred Units, as of September 30, 2022 — $ — (1) Included 21,417 PIK units on a pro rata basis. |
SERIES A CUMULATIVE REDEEMABLE
SERIES A CUMULATIVE REDEEMABLE PREFERRED UNITS | 9 Months Ended |
Sep. 30, 2022 | |
Equity [Abstract] | |
SERIES A CUMULATIVE REDEEMABLE PREFERRED UNITS | EQUITY AND WARRANTS Redeemable Noncontrolling Interest — Common Unit Limited Partners On February 22, 2022, the Company consummated the Transaction. Pursuant to the Contribution Agreement, in connection with the Closing, (i) Contributor contributed all of the equity interests of the Contributed Entities to the Partnership; and (ii) in exchange for such contribution, the Partnership transferred to Contributor 50,000,000 common units representing limited partner interests in the Partnership and 50,000,000 shares of the Company’s Class C Common Stock, par value $0.0001 per share. Please refer to “The Transaction” above. The redemption option of the Common Unit is not legally detachable or separately exercisable from the instrument and is non-transferable, and the Common Unit is redeemable at the option of the holder. Therefore, the Common Unit is accounted for as redeemable noncontrolling interest and classified as temporary equity on the Company’s Condensed Consolidated Balance Sheet. During the first nine months of 2022, 5,730,000 common units were redeemed on a one-for-one basis for shares of Class A Common Stock and a corresponding number of shares of Class C Common Stock were cancelled. There were 94,270,000 Common Units and an equal number of Class C Common Stock issued and outstanding as of September 30, 2022. The Common Units fair value was approximately $3.06 billion as of September 30, 2022. Redeemable Noncontrolling Interest — Preferred Unit Limited Partners Upon Closing, the Company assumed certain Preferred Units that were issued and outstanding on acquisition date. The Company has redeemed all assumed Preferred Units since the Closing. Refer to Note 11—Series A Cumulative Redeemable Preferred Units for further discussion. Public Warrants As of September 30, 2022, there were 12,577,350 Public Warrants (as defined below) outstanding. Each whole public warrant entitles the holder to purchase one tenth of a share of Class A Common Stock at a price of $115.00 per share (the “Public Warrants”). The Public Warrants will expire on November 9, 2023 or upon redemption or liquidation. The Company may call the Public Warrants for redemption, in whole and not in part, at a price of $0.01 per warrant with not less than 30 days’ notice provided to the Public Warrant holders. However, this redemption right can only be exercised if the reported last sale price of the Class A Common Stock equals or exceeds $180.00 per share for any 20-trading days within a 30-trading day period ending three business days prior to sending the notice of redemption to the Public Warrant holders. Private Placement Warrants As of September 30, 2022, there were 6,364,281 Private Placement Warrants (as defined below) outstanding, of which Apache holds 3,182,140. The private placement warrants will expire on November 9, 2023 and are identical to the Public Warrants discussed above, except (i) they will not be redeemable by the Company so long as they are held by the initial holders or their respective permitted transferees and (ii) they may be exercised by the holders on a cashless basis (the “Private Placement Warrants” and, together with the Public Warrants, the “Warrants”). The Company recorded a fair value of $0.1 million for the Public Warrants and a fair value of $0.1 million for the Private Warrants as of September 30, 2022 on the Condensed Consolidated Balance Sheet in other non-current liabilities. Refer to Note 15—Fair Value Measurement in the Notes to our Condensed Consolidated Financial Statements in this Form 10-Q for additional discussion regarding valuation of the Warrants. Dividend On February 22, 2022, the Company entered into a Dividend and Distribution Reinvestment Agreement (the “Reinvestment Agreement”) with certain stockholders including BCP Raptor Aggregator, LP, BX Permian Pipeline Aggregator, LP, Buzzard Midstream LLC, APA Corporation Apache Midstream LLC, and certain individuals (each, a “Reinvestment Holder”). Under the Reinvestment Agreement, each Reinvestment Holder is obligated to reinvest at least 20% of all distributions on Common Units or dividends on shares of Class A Common Stock in the Company’s Class A Common Stock. Additionally, the Audit Committee and subsequently the Company’s Board of Directors (the “Board”) resolved that for the calendar year 2022, 100% of all distributions or dividends received by each Reinvestment Holder would be reinvested in newly issued shares of Class A Common Stock. As described in these Condensed Consolidated Financial Statements, as the context requires, dividends paid to holders of Class A Common Stock and distributions paid to holders of Common Units may be referred to collectively as “dividends.” During the nine months ended September 30, 2022, the Company made cash dividend payments of $25.3 million to holders of Class A Common Stock and Common Units and $175.5 million was reinvested in shares of Class A Common Stock by Reinvestment Holders. On October 19, 2022, the Board declared a cash dividend of $0.75 per share on the Company’s Class A Common Stock and a distribution of $0.75 per Common Unit from the Partnership to the holders of Common Units. Dividends are payable on November 17, 2022. Certain holders of Class A Common Stock and Class C Common Stock will receive a cash dividend with the balance receiving additional shares of Class A Common Stock under the Reinvestment Agreement. Stock Split On May 19, 2022, the Company announced that its Board approved and declared a two-for-one stock split with respect to its Class A Common Stock and Class C Common Stock, in the form of a stock dividend (the “Stock Split”). The Stock Split was accomplished by distributing one additional share of Class A Common Stock for each share of Class A Common Stock outstanding and one additional share of Class C Common Stock for each share of Class C Common Stock outstanding. The additional shares of Common Stock were issued on June 8, 2022 to holders of record at the close of business on May 31, 2022. All corresponding per-share and share amounts, excluding the Transaction, for periods prior to June 8, 2022 have been retroactively restated in this Form 10-Q to reflect the Stock Split. Prior to the Closing Date of the Transaction, the Partnership had 625,000 Preferred Units issued and outstanding. Immediately prior to the Closing, on February 22, 2022, the Partnership redeemed for cash, 100,000 Preferred Units in an amount equal to approximately $120.1 million. The Company assumed the remaining 525,000 Preferred Units as well as 29,983 paid-in-kind (“PIK”) Preferred Units that were issued and outstanding at the closing of the Transaction. At the close, 150,000 preferred units and 8,567 associated PIK units became mandatorily redeemable and liability classified with the balance of preferred units remaining unchanged and classified as redeemable noncontrolling interest. The Company redeemed 125,000 mandatorily redeemable preferred units during the first two quarters of 2022 with the balance of mandatorily redeemable preferred units being redeemed during July for $30.7 million. In July 2022, the Company redeemed all outstanding redeemable noncontrolling interest Preferred Units for an aggregate $461.5 million. The excess of the carrying amount of the redeemable noncontrolling interest Preferred units immediately prior to redemption over redemption price was included in “Retained Earnings” in the Condensed Consolidated Balance Sheets. Activities related to Preferred Units for the nine months ended September 30, 2022 are as follows: Units Outstanding Amount (In thousands, except for unit data) Redeemable noncontrolling interest — Preferred Units, immediately upon Closing of Transaction (1) 396,417 $ 462,717 Redemption, including PIK units (396,417) (461,460) Cash distribution paid to Preferred Unit limited partners — (6,937) Allocation of net income — 18,128 Accreted redemption value adjustment — 97,075 Excess of carrying amount over redemption price — (109,523) Redeemable noncontrolling interest — Preferred Units, as of September 30, 2022 — $ — (1) Included 21,417 PIK units on a pro rata basis. |
SHARE-BASED COMPENSATION
SHARE-BASED COMPENSATION | 9 Months Ended |
Sep. 30, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
SHARE-BASED COMPENSATION | SHARE-BASED COMPENSATION Prior to the Closing, the Company issued incentive units, which included performance and service conditions, to certain employees and board members. The units consisted of Class A-1, Class A-2, and Class A-3 units. These units derived value from the Company’s certain wholly owned subsidiaries. Class A-1 and A-2 units would have vested upon either (i) the date of consummation of a change in control or (ii) the date that is 1-year following the consummation of the initial public offering (“IPO”) of the Company (or its successor) (collectively “Exit Events”). Class A-3 units would have vested upon a change in control, if the participants were employed at the time of the event, or upon termination of the participant by the Company. Immediately upon Closing, all outstanding Class A-1 and Class A-2 units were cancelled and exchanged for 5,300,000 shares (the “Class A Shares”), post-Stock Split, of the Company’s Class A Common Stock. These Class A Shares are issued and outstanding as they were distributed pro rata to all holders of Class A-1 and Class A-2 units by the Common Unit limited partners from the 50,000,000 common units, pre-Stock-Split, that such limited partners received upon the Closing. The Common Unit limited partners redeemed Common Units needed for the Class A shares distribution upon the Closing. The Class A Shares are held in escrow and will vest over three During 2022, pursuant to the Company’s 2019 Omnibus Compensation Plan, as amended from time to time (the “Plan”) , the Company granted a total of 13,941 restricted stock units (“RSUs”) to certain members of the Board, which were vested immediately on grant date, and granted a total of 14,144 RSUs to new employees, which are subject to a vesting period between one With respect to the above shares, the Company recorded compensation expenses of $12.7 million and $31.0 million for the three and nine months ended September 30, 2022, respectively, based on a straight line amortization of the associated awards’ fair value over the respective vesting life of the shares. With respect to the above incentive units, no compensation expenses were recorded for the three and nine months ended September 30, 2021, as the incentive units were considered non-vested prior to their cancellation and exchange for Class A or Class C Common Stock, and no RSUs were granted during 2021. |
INCOME TAXES
INCOME TAXES | 9 Months Ended |
Sep. 30, 2022 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES The Company is subject to U.S. federal income tax and the Texas margin tax. Income tax expense included in the Condensed Consolidated Financial Statements in this Form 10-Q is as follows: Three Months Ended September 30, Nine Months Ended September 30, 2022 2022 (In thousands) Income before income taxes $ 50,828 $ 204,503 Income tax expense $ 1,406 $ 2,244 Effective tax rate (1) 2.77 % 1.10 % (1) Prior to the Closing on February 22, 2022, BCP, the accounting acquirer, was organized as limited partnership and was not subject to the U.S. federal income tax for the three and nine months ended September 30, 2021. The effective tax rate for the three and nine months ended September 30, 2022 was lower than the statutory rate mainly due to the impact of tax attributable to noncontrolling interests related to the Common Units and Preferred Units limited partners and valuation allowance. Upon Closing, the Company assumed certain uncertain tax positions from ALTM. The Company accounts for income taxes in accordance with ASC 740—Income Taxes , which prescribes a minimum recognition threshold a tax position must meet before being recognized in the financial statements. Tax positions generally refer to a position taken in a previously filed income tax return or expected to be included in a tax return to be filed in the future that is reflected in the measurement of current and deferred income tax assets and liabilities. Reconciliation of the beginning and ending amount of unrecognized tax benefit is as follows: (In thousands) Amount Balance at December 31, 2021 $ — Increase related to ALTM acquisition 5,238 Reduction related to current year activities (5,238) Balance at September 30, 2022 $ — |
NET INCOME PER SHARE
NET INCOME PER SHARE | 9 Months Ended |
Sep. 30, 2022 | |
Earnings Per Share [Abstract] | |
NET INCOME PER SHARE | NET INCOME PER SHARE The computation of basic and diluted net income per share for the periods presented in the Condensed Consolidated Financial Statements is shown in the tables below. Three Months Ended September 30, 2022 2021 Income Weighted-average shares (3) Per Share Income Weighted-average shares (3) Per Share (In thousands, except per share data) Basic: Net income attributable to Class A common shareholders $ 14,936 41,816 $ 0.36 $ — — $ — Less: Net income available to participating unvested restricted Class A common shareholders (4) (4,174) — $ — — — $ — Excess preferred carrying amount over consideration paid (5) 32,900 — $ — — — $ — Total net income attributable to Class A common shareholders $ 43,662 41,816 $ 1.04 $ — — $ — Effect of dilutive securities: Unvested Class A common shares — 39 $ — — — $ — Diluted (1)(2) : Net income attributable to Class A common shareholders $ 43,662 41,855 $ 1.04 $ — — $ — Nine Months Ended September 30, 2022 2021 Income Weighted-average shares (3) Per Share Income Weighted-average share (3) Per Share (In thousands, except per share data) Basic: Net income attributable to Class A common shareholders $ 25,239 40,042 $ 0.63 $ — — $ — Less: Net income available to participating unvested restricted Class A common shareholders (4) (8,358) — $ — — — $ — Excess preferred carrying amount over consideration paid (5) 32,900 — $ — — — $ — Total net income attributable to Class A common shareholders $ 49,781 40,042 $ 1.24 $ — — $ — Effect of dilutive securities: Unvested Class A common shares — 33 $ — — — $ — Diluted (1)(2) : Net income attributable to Class A common shareholders $ 49,781 40,075 $ 1.24 $ — — $ — (1) The effect of an assumed exchange of the outstanding public and private warrants for shares of Class A Common Stock would have been anti-dilutive for all periods presented in which the public and private warrants were outstanding. (2) The effect of an assumed exchange of outstanding Common Units (and the cancellation of a corresponding number of shares of outstanding Class C Common Stock) would have been anti-dilutive for all periods presented in which the Common Units were outstanding. (3) Share amounts have been retroactively restated to reflect the Company’s two-for-one Stock Split. Refer to Note 10—Equity and Warrants in the Notes to our Condensed Consolidated Financial Statements in this Form 10-Q for further information. (4) Represents dividends paid to unvested restricted Class A common shareholders. (5) Represented excess of carrying value of redeemable noncontrolling interest Preferred Units over redemption price at redemption. |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 9 Months Ended |
Sep. 30, 2022 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENTS | FAIR VALUE MEASUREMENTS The Company’s financial assets and liabilities measured at fair value on a recurring basis include cash and cash equivalents, accrued receivables, accounts receivable, accounts receivable from affiliates, dividends and distributions payable, interest rate and commodity swap derivatives, and Company’s private and public warrants and an embedded derivative liability related to the issuance of Preferred Units. Topic 820 establishes a framework for measuring fair value in U.S. GAAP, clarifies the definition of fair value within that framework, and requires disclosures about the use of fair value measurements. Topic 820 defines fair value as the price that would be received to sell an asset, or paid to transfer a liability, in an orderly transaction between market participants at the measurement date. Topic 820 provides a framework for measuring fair value, establishes a three-level hierarchy for fair value measurements based upon the transparency of inputs to the valuation of an asset or liability as of the measurement date and requires consideration of the counterparty’s creditworthiness when valuing certain assets. Topic 820 establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets (Level 1 inputs). The three levels of the fair value hierarchy under Topic 820 are described below: Level 1 inputs : Unadjusted, quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities. An active market is defined as a market where transactions for the financial instrument occur with sufficient frequency and volume to provide pricing information on an ongoing basis. Level 2 inputs : Inputs, other than quoted prices in active markets, that are either directly or indirectly observable for the asset or liability through correlation with market data at the measurement date and for the duration of the instrument’s anticipated life. Level 3 inputs : Prices or valuations that require unobservable inputs that are both significant to the fair value measurement and unobservable. Valuation under Level 3 generally involves a significant degree of judgment from management. A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. Where available, fair value is based on observable market prices or inventory parameters or derived from such prices or parameters. Where observable prices or inputs are not available, valuation models are applied. These valuation techniques involve some level of management estimation and judgment, the degree of which is dependent on the price transparency for the instruments or market and the instrument’s complexity. The following tables present financial assets and liabilities that are measured at fair value on a recurring basis as of September 30, 2022 and December 31, 2021: September 30, 2022 Level 1 Level 2 Level 3 Total (In thousands) Public warrants $ 126 $ — $ — $ 126 Private warrants — — 95 95 Total liabilities $ 126 $ — $ 95 $ 221 December 31, 2021 Level 1 Level 2 Level 3 Total (In thousands) Commodity swaps $ — $ 205 $ — $ 205 Interest rate derivatives — 2,662 — 2,662 Contingent liabilities — — 839 839 Total liabilities $ — $ 2,867 $ 839 $ 3,706 The Company is exposed to certain risks arising from both its business operations and economic conditions, and the Company enters into certain derivative contracts to manage the exposures. Refer to Note 16—Derivatives and Hedging Activities in the Notes to our Condensed Consolidated Financial Statements in this Form 10-Q for further discussion related to commodity swaps and interest rate derivatives. The Company bifurcated and recognized the embedded derivative associated with the Preferred Units related to the exchange option provided to the Preferred Unit holders under the terms of the Partnership LPA. The Company redeemed all outstanding Preferred Units in July 2022 and wrote off related embedded derivative liabilities as of September 30, 2022. The Company recorded gains of $0.5 million and $89.1 million for the three and nine months ended September 30, 2022, which was recorded as a “Gain on embedded derivative” in the Condensed Consolidated Statement of Operations. The carrying value of the Company’s Public Warrants are recorded at fair value based on quoted market prices, a Level 1 fair value measurement. The carrying value of the Company’s Private Placement Warrants are recorded at fair value determined using an option pricing model, a Level 3 fair value measurement, which is calculated based on key assumptions related to expected volatility of the Company’s common stock, an expected dividend yield, the remaining term of the warrants outstanding and the risk-free rate based on the U.S. Treasury yield curve in effect at the time of the valuation. These assumptions are estimated utilizing historical trends of the Company’s common stock, Public Warrants and other factors. The Company has recorded a liability of $0.2 million as of September 30, 2022. There was no change in fair value of the warrants since closing of the Transaction through reporting date. The carrying amounts reported on the Condensed Consolidated Balance Sheets for the Company’s remaining financial assets and liabilities approximate fair value due to their short-term nature. There were no transfers between Level 1, Level 2 or Level 3 of the fair value hierarchy during the three and nine months ended September 30, 2022 and 2021. |
DERIVATIVES AND HEDGING ACTIVIT
DERIVATIVES AND HEDGING ACTIVITIES | 9 Months Ended |
Sep. 30, 2022 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
DERIVATIVES AND HEDGING ACTIVITIES | DERIVATIVES AND HEDGING ACTIVITIES The Company is exposed to certain risks arising from both its business operations and economic conditions, and it enters into certain derivative contracts to manage exposure to these risks. The Company did not elect to apply hedge accounting to these derivative contracts and recorded fair value of the derivatives on the Condensed Consolidated Balance Sheets as of September 30, 2022 and December 31, 2021. Interest Rate Risk The Company manages market risks, including interest rate, liquidity, and credit risk primarily by managing the amount, sources, and duration of its debt funding and by using derivative financial instruments. Specifically, the Company enters into derivative financial instruments to manage exposures that arise from activities that result in the payment of future known and uncertain cash amounts, the value of which are determined by interest rates. The Company minimizes counterparty credit risk in derivative instruments by entering into transactions with high credit-rating counterparties. The Company’s objectives in using interest rate derivatives is to add stability to interest expense and to manage its exposure to interest rate movements. To accomplish this objective, the Company primarily uses interest rate swaps and Term SOFR elections, (able to fix up to six months forward SOFR), granted under the company’s debt agreements as part of its interest rate risk management strategy. Interest rate swaps designated as cash flow hedges involve the receipt of variable amounts from a counterparty if interest rates rise above the strike rate on the contract. In June 2022, all of BCP PHP, LLC’s (“BCP PHP”) outstanding interest rate swaps were terminated as BCP PHP’s outstanding term loan credit facility was extinguished on June 8, 2022. Refer to Note 6—Debt and Financing Costs in the Notes to our Condensed Consolidated Financial Statements for additional information about the refinancing transactions. The fair value or settlement value of the consolidated interest rate swaps outstanding are presented on a gross basis on the Condensed Consolidated Balance Sheets. Interest rate swap derivative liabilities were nil and $2.7 million as of September 30, 2022 and December 31, 2021, respectively. The Company recorded cash settlements on interest rate swap derivatives of nil and $0.7 million for the three months ended September 30, 2022 and 2021, respectively, and $11.3 and $2.2 million for the nine months ended September 30, 2022 and 2021, respectively, in “Interest Expense” of the Condensed Consolidated Statements of Operations. In addition, the Company recorded fair value adjustments of nil and $26 thousand for the change in fair value of the interest rate swap derivatives for the three months ended September 30, 2022 and 2021, respectively, and $14.0 million and $3.1 million for the nine months ended September 30, 2022 and 2021, respectively, in “Interest Expense” of the Condensed Consolidated Statements of Operations. Commodity Price Risk Similarly, in 2020 and 2021 BCP Raptor, LLC (“BCP I”) and BCP Raptor II, LLC (“BCP II”) had WTI crude hedges at a specific notional amount that provides for a fixed price for crude in the Permian Basin and Waha basis hub hedges on various notional quantities of gas that either provided for a fixed price differential of natural gas in the Permian Basin relative to the NYMEX natural gas contract or provided for a fixed price for natural gas in the Permian Basin. All of the Company’s commodity swaps had reached maturity as of December 31, 2021. The fair value or settlement value of the swaps outstanding are presented on a gross basis on the Condensed Consolidated Balance Sheet. Commodity swap derivative liability was nil and $0.2 million as of September 30, 2022 and December 31, 2021, respectively. The Company recorded cash settlements on commodity swap derivatives of nil and $0.9 million for the three months ended September 30, 2022 and 2021, respectively, and $0.2 million and $15.8 million for the nine months ended September 30, 2022 and 2021, respectively, in “Other Revenue” of the Condensed Consolidated Statements of Operations. In addition, the Company recorded fair value adjustments of $0.6 million and $17.1 million for the change in fair value of commodity swap derivatives for the three and nine months ended September 30, 2021, respectively, in “Other Revenue” of the Condensed Consolidated Statements of Operations. No fair value adjustment recognized for the three and nine months ended September 30, 2022 as no commodity swaps were outstanding. |
SEGMENTS
SEGMENTS | 9 Months Ended |
Sep. 30, 2022 | |
Segment Reporting [Abstract] | |
SEGMENTS | SEGMENTS Our two operating segments represent the Company’s segments for which discrete financial information is available and is utilized on a regular basis by our chief operating decision maker (“CODM”) to make key operating decisions, assess performance and allocate resources. Our Chief Executive Officer is the CODM. These segments are strategic business units with differing products and services. No operating segments have been aggregated to form the reportable segments. Therefore, our two operating segments represent our reportable segments. The activities of each of our reportable segments from which the Company earns revenues and incurs expenses are described below: • Midstream Logistics: The Midstream Logistics segment operates under three streams, 1) gas gathering and processing, 2) crude oil gathering, stabilization and storage services and 3) water gathering and disposal. • Pipeline Transportation: The Pipeline Transportation segment consists of equity investment interests in four Permian Basin pipelines that access various points along the Texas Gulf Coast, Brandywine NGL Pipeline and Delaware Link Pipeline that is under development. The current operating pipelines transport crude oil, natural gas and NGLs. Upon Closing, our CODM reviewed the Company and ALTM’s reporting segment activities. The Company then renamed its Gathering and Processing segment to Midstream Logistics and its Transmission segment to Pipeline Transportation. These name changes were made to better align segment activities with the name of the respective segment. There was no change in segment composition or structure for the three and nine months ended September 30, 2022. The following tables present the reconciliation of the segment profit measure as of and for the three and nine months ended September 30, 2022 and 2021: Midstream Logistics Pipeline Transportation Corporate and Other (1) Consolidated (2) For the three months ended September 30, 2022 (In thousands) Segment net income (loss) including noncontrolling interests $ 65,525 $ 44,750 $ (60,853) $ 49,422 Add back: Interest expense 7 — 40,457 40,464 Income tax expense — — 1,406 1,406 Depreciation and amortization 64,655 345 5 65,005 Contract assets amortization 448 — — 448 Proportionate EMI EBITDA — 78,357 — 78,357 Share-based compensation — — 12,661 12,661 Loss on disposal of assets 3,946 — — 3,946 Integration costs 14 81 2,243 2,338 Acquisition transaction costs 5 — 57 62 Other one-time costs or amortization 2,945 162 645 3,752 Deduct: Gain on embedded derivative — — 488 488 Equity income from unconsolidated affiliates — 45,003 — 45,003 Segment adjusted EBITDA $ 137,545 $ 78,692 $ (3,867) $ 212,370 Midstream Logistics Pipeline Transportation Corporate and Other (1) Consolidated (2) For the three months ended September 30, 2021 (In thousands) Segment net income (loss) including noncontrolling interests $ (6,210) $ 13,333 $ (2,483) $ 4,640 Add back: Interest expense 27,682 2,859 — 30,541 Income tax expense 1,207 — — 1,207 Depreciation and amortization 57,026 128 — 57,154 Contract assets amortization 448 — — 448 Proportionate EMI EBITDA — 21,704 — 21,704 Loss (gain) on disposal of assets (60) 23 — (37) Loss on debt extinguishment 56 — — 56 Other one-time costs or amortization 802 160 205 1,167 Deduct: Interest and other income 74 — — 74 Equity income from unconsolidated affiliates — 16,826 — 16,826 Segment adjusted EBITDA $ 80,877 $ 21,381 $ (2,278) $ 99,980 Midstream Logistics Pipeline Transportation Corporate and Other (1) Consolidated (2) For the nine months ended September 30, 2022 (In thousands) Segment net income (loss) including noncontrolling interests $ 89,274 $ 120,162 $ (7,177) $ 202,259 Add back: Interest expense 47,411 (664) 45,838 92,585 Income tax expense (benefit) 457 (39) 1,826 2,244 Depreciation and amortization 192,007 597 5 192,609 Contract assets amortization 1,344 — — 1,344 Proportionate EMI EBITDA — 190,438 — 190,438 Share-based compensation — — 30,966 30,966 Loss (gain) on disposal of assets 12,636 — (34) 12,602 Loss (gain) on debt extinguishment 27,983 (8) — 27,975 Integration costs 933 81 8,998 10,012 Acquisition transaction costs 9 — 6,403 6,412 Other one-time costs or amortization 8,865 162 1,942 10,969 Deduct: Gain on redemption of mandatorily redeemable Preferred units — — 9,580 9,580 Gain on embedded derivative — — 89,050 89,050 Equity income from unconsolidated affiliates — 120,706 — 120,706 Segment adjusted EBITDA $ 380,919 $ 190,023 $ (9,863) $ 561,079 Midstream Logistics Pipeline Transportation Corporate and Other (1) Consolidated (2) For the nine months ended September 30, 2021 (In thousands) Segment net income (loss) including noncontrolling interests $ (22,238) $ 37,072 $ (7,424) $ 7,410 Add back: Interest expense 82,967 5,491 — 88,458 Income tax expense 1,207 — — 1,207 Depreciation and amortization 169,906 385 — 170,291 Contract assets amortization 1,815 — — 1,815 Proportionate EMI EBITDA — 59,677 — 59,677 Loss on disposal of assets 394 23 — 417 Gain on debt extinguishment (4) — — (4) Derivatives loss due to Winter Storm Uri 13,456 — — 13,456 Other one-time costs or amortization 1,675 182 153 2,010 Producer settlement 6,827 — — 6,827 Deduct: Interest and other income 115 — — 115 Equity income from unconsolidated affiliates — 44,692 — 44,692 Segment adjusted EBITDA $ 255,890 $ 58,138 $ (7,271) $ 306,757 (1) Corporate and Other represents those results that: (i) are not specifically attributable to a reportable segment; (ii) are not individually reportable or (iii) have not been allocated to a reportable segment for the purpose of evaluating their performance, including certain general and administrative expense items. (2) Results do not include legacy ALTM prior to February 22, 2022. Refer to Note 1 —Description of the Organization and Summary of Significant Accounting Policies in the Notes to our Condensed Consolidated Financial Statements in this Form 10-Q, for further information on the Company’s basis of presentation. Adjusted EBITDA is a non-GAAP measure; please see Key Performance Metrics in Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations of this Form 10-Q, for a definition and reconciliation to the GAAP measure. The following tables present the revenue for individual operating segment for the three and nine months ended September 30, 2022 and 2021: Midstream Logistics Pipeline Transportation Consolidated For the three months ended September 30, 2022 (In thousands) Revenue $ 320,667 $ 733 $ 321,400 Other revenue 3,774 2 3,776 Total segment operating revenue $ 324,441 $ 735 $ 325,176 Midstream Logistics Pipeline Transportation Consolidated For the three months ended September 30, 2021 (In thousands) Revenue $ 165,844 $ — $ 165,844 Other revenue 740 2 742 Total segment operating revenue $ 166,584 $ 2 $ 166,586 Midstream Logistics Pipeline Transportation Consolidated For the nine months ended September 30, 2022 (In thousands) Revenue $ 907,771 $ 733 $ 908,504 Other revenue 9,487 6 9,493 Total segment operating revenue $ 917,258 $ 739 $ 917,997 Midstream Logistics Pipeline Transportation Consolidated For the nine months ended September 30, 2021 (In thousands) Revenue $ 446,840 $ — $ 446,840 Other revenue 3,609 6 3,615 Total segment operating revenue $ 450,449 $ 6 $ 450,455 The following table presents total assets for each operating segment as of September 30, 2022 and December 31, 2021: September 30, 2022 December 31, 2021 (In thousands) Midstream Logistics $ 3,575,642 $ 2,916,774 Pipeline Transportation 2,417,663 635,784 Segment total assets 5,993,305 3,552,558 Corporate and other 13,873 648 Total assets $ 6,007,178 $ 3,553,206 |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 9 Months Ended |
Sep. 30, 2022 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | SUBSEQUENT EVENTS On October 10, 2022, the Company announced the transfer of its Class A Common Stock to the New York Stock Exchange (“NYSE”) from the Nasdaq Global Select Market (“Nasdaq”). The Company’s Class A Common Stock began trading on the NYSE under its current ticker symbol, “KNTK”, at the open of trading on Monday, October 24, 2022. On October 19, 2022, the Board declared a cash dividend of $0.75 per share on the Company’s Class A Common Stock which will be payable to stockholders on November 17, 2022. The Company, through its ownership of the general partner of the Partnership, declared a distribution of $0.75 per Common Unit from the Partnership to the holders of Common Units. Please refer to Note 10—Equity and Warrants in the Notes to our Condensed Consolidated Financial Statements in this Form 10-Q for additional information. |
DESCRIPTION OF THE ORGANIZATI_2
DESCRIPTION OF THE ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 9 Months Ended |
Sep. 30, 2022 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of PresentationThe accompanying unaudited Condensed Consolidated Financial Statements have been prepared in accordance with GAAP. Certain reclassifications of prior year balances have been made to conform such amounts to current year presentation. These reclassifications have no impact on net income. All adjustments that, in the opinion of management, are necessary for a fair presentation of the results of operations for the interim periods have been made and are of a recurring nature unless otherwise disclosed herein. The results of operations for such interim periods are not necessarily indicative of results of operations for a full year. All intercompany balances and transactions have been eliminated in consolidation. |
Principles of Consolidation | Prior to the Closing, the Company’s financial statements that were filed with the SEC were derived from ALTM’s accounting records. As the Transaction was determined to be a reverse merger, BCP was considered as the accounting acquirer and ALTM was the legal acquirer. The accompanying Condensed Consolidated Financial Statements herein include (1) BCP’s net assets carried at historical value, (2) BCP’s historical results of operations prior to the Transaction, (3) the ALTM’s net assets carried at fair value as of the Closing Date and (4) the combined results of operations with the Company’s results presented within the Condensed Consolidated Financial Statements from February 22, 2022 going forward. Refer to Note 2—Business Combination to our Condensed Consolidated Financial Statements in this Form 10-Q for additional discussion. The Company completed a two-for-one Stock Split on June 8, 2022. All corresponding per-share and share amounts for periods prior to June 8, 2022 have been retroactively restated in this Form 10-Q to reflect the two-for-one Stock Split, except for the number of Common Units and shares of Class C Common Stock described above in relation to the Transaction, which are presented at pre-Stock-Split amounts. This presentation election is consistent with our previous public filings and the terms of the Contribution Agreement. |
Use of Estimates | Use of Estimates Preparation of financial statements in conformity with GAAP and disclosure of contingent assets and liabilities requires management to make estimates and assumptions that affect reported amounts of assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. The Company bases its estimates on historical experience and various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about carrying values of assets and liabilities that are not readily apparent from other sources. The Company evaluates its estimates and assumptions on a regular basis. Actual results may differ from these estimates and assumptions used in preparation of its condensed consolidated financial statements, and changes in these estimates are recorded when known. Significant items subject to such estimates and assumptions include the valuation of tangible and intangible assets, share-based compensation, contingent liabilities, warrants, and noncontrolling interests. |
Variable Interest Entity | Variable Interest Entity The Company uses a qualitative approach in assessing the consolidation requirement for variable interest entities. The approach focuses on identifying which enterprise has the power to direct the activities that most significantly impact the variable interest entity’s economic performance and which enterprise has the obligation to absorb losses or the right to receive benefits from the variable interest entity. In the event that the Company is the primary beneficiary of a variable interest entity, the assets, liabilities, and results of operations of the variable interest entity would be consolidated in our financial statements. The Company has determined that it has significant influence over the operating and financial policies of the four pipeline entities in which it is invested, but does not exercise control over them; and hence, it accounts for these investments using the equity method. Refer to Note 9—Equity Method Investments in the Notes to our Condensed Consolidated Financial Statements in this Form 10-Q. |
Redeemable Noncontrolling Interest | Redeemable Noncontrolling Interest — Common Units Limited Partners Pursuant to the Contribution Agreement, in connection with the Closing, (i) Contributor contributed all of the equity interests of the Contributed Entities to the Partnership; and (ii) in exchange for such contribution, the Partnership transferred to Contributor 50,000,000 common units representing limited partner interests in the Partnership and 50,000,000 shares of the Company’s Class C Common Stock, par value $0.0001 per share. Please refer to “The Transaction” above. The Common Units are redeemable at the option of unit holders and accounted for in the Company’s Condensed Consolidated Balance Sheet as a redeemable noncontrolling interest classified as temporary equity. The Company records the redeemable noncontrolling interest at the higher of (i) its initial value plus accumulated earnings/losses associated with the noncontrolling interest or (ii) the maximum redemption value as of the balance sheet date. The redemption value was determined based on a 5-day volume weighted-average closing price of the Class A Common Stock. See discussion and additional details in Note 10—Equity and Warrant in the Notes to our Condensed Consolidated Financial Statements in this Form 10-Q. Redeemable Noncontrolling Interest — Preferred Unit Limited Partners The Partnership issued Series A Cumulative Redeemable Preferred Units (“Preferred Units”) on June 12, 2019. As the Transaction was accounted for as a reverse merger, the Company assumed certain Preferred Units that were issued and outstanding at Closing for accounting purposes. |
Equity Method Interests | Equity Method InvestmentsThe Company follows the equity method of accounting when it does not exercise control over its equity interests, but can exercise significant influence over the operating and financial policies of the entity. Under this method, the equity investments are carried originally at acquisition cost, increased by the Company’s proportionate share of the equity interest’s net income and contributions made, and decreased by the Company’s proportionate share of the equity interest’s net losses and distributions received. The Company determines whether distributions are a return on or a return of the investment based on the nature of the distribution approach, under which the Company classifies distributions from an investee by evaluating the facts, circumstances and nature of each distribution. As distributions from the Company’s equity method investment (“EMI”) pipeline entities are generated from their respective normal course of business, the Company classifies the distributions as return on investments and as cash flow from operating activities. Unamortized basis differences will be amortized into equity income over the useful lives of the underlying pipeline assets. |
Inventory | InventoryOther current assets include condensate, residue gas and NGLs inventories that are valued at the lower of cost or market. At the end of each reporting period, the Company assesses the carrying value of inventory and makes any adjustments necessary to reduce the carrying value to the applicable net realizable value. |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets In accordance with Financial Accounting Standards Board (“FASB”) ASC 360, Property, Plant and Equipment, long-lived assets, excluding goodwill, to be held and used by the Company are reviewed for impairment annually or on an interim basis if events or circumstances indicate that the fair value of the assets have decreased below their carrying value. For long-lived assets to be held and used, the Company bases their evaluation on impairment indicators such as the nature of the assets, the future economic benefit of the assets, any historical or future profitability measurements and other external market conditions or factors that may be present. |
Transactions with Affiliates | Transactions with AffiliatesThe accounts receivable from or payable to affiliates represent the net result of the Company’s monthly revenue, capital and operating expenditures, and other miscellaneous transactions to be settled with Apache and its subsidiaries, who controlled the Company prior to the Transaction. |
Net Income per Share | Net Income Per Share Basic net income per share is calculated by dividing net income attributable to Class A common shareholders by the weighted-average number of shares of Class A Common Stock outstanding during the period. Class C Common Stock is excluded from the weighted-average shares outstanding for the calculation of basic net income per share, as holders of Class C Common Stock are not entitled to any dividends or liquidating distributions. No net income per share was computed for the three and nine months ended September 30, 2021, as no Class A Common Stock was outstanding with respect to BCP as the accounting acquirer as of September 30, 2021. The Company uses the “if-converted method” to determine the potential dilutive effect of (i) an assumed exchange of outstanding Common Units (and the cancellation of a corresponding number of shares of outstanding Class C Common Stock) for shares of Class A Common Stock and (ii) an assumed exercise of the outstanding public and private warrants for shares of Class A Common Stock. The dilutive effect of any earn-out consideration payable in shares is only included in periods for which the underlying conditions for the issuance are met. |
Recently Adopted Accounting Pronouncement and Recent Accounting Pronouncement Not Yet Adopted | Recently Adopted Accounting Pronouncement Effective January 1, 2022, the Company adopted ASU 2021-08 , Business Combinations (Topic 805), Accounting for Contract Assets and Contract Liabilities from Contracts with Customers (“ASU 2021-08”), which requires contract assets and contract liabilities (i.e., deferred revenue) acquired in a business combination to be recognized and measured by the acquirer on the acquisition date in accordance with ASC 606, Revenue from Contracts with Customers . Generally, this new guidance will result in the acquirer recognizing contract assets and contract liabilities at the same amounts recorded by the acquiree. Historically, such amounts were recognized by the acquirer at fair value. With adoption of ASU 2021-08, the Company assumed contract liabilities at carrying value of $9.1 million upon Closing. Effective January 1, 2022, the Company adopted ASU 2020-04, Reference Rate Reform (Topic 848) (“ASU 2020-04”) . ASU 2020-04 was issued to ease the potential accounting burden expected when global capital markets move away from LIBOR, the benchmark interest rate banks use to make short-term loans to each other. The amendments in this update provide optional expedients and exceptions for applying GAAP to contracts, hedging relationship, and other transactions affected by reference rate reform if certain criteria are met. Interest rate applied to the Company’s new Term Loan and Revolver borrowings resulting from the comprehensive refinance is based on Secured Overnight Financing Rate (“SOFR”), which is a broad measure of the cost of borrowing cash overnight collateralized by treasury securities. Refer to Note 6—Debt and Financing Costs in the Notes to our Condensed Consolidated Financial Statements of this Form 10-Q for discussion of SOFR applicable to the Company’s debt structures. Recent Accounting Pronouncement Not Yet Adopted In June 2022, the FASB issued ASU 2022-03, Fair Value Measurement (Topic 820): Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions (“ASU 2022-03”). The amendments in ASU 2022-03 clarify that a contractual restriction on the sale of an equity security is not considered part of the unit of account of the equity security and, therefore, is not considered in measuring fair value. The amendments also clarify that an entity cannot, as a separate unit of account, recognize and measure a contractual sale restriction. The amendments also require the following disclosures for equity securities subject to contractual sale restrictions: (1) The fair value of equity securities subject to contractual sale restrictions reflected in the balance sheet; (2) The nature and remaining duration of the restriction(s); (3) The circumstances that could cause a lapse in the restriction(s). This guidance is effective for public business entities for fiscal years beginning after December 15, 2023, and interim periods within those fiscal years. Early adoption is permitted for both interim and annual financial statements that have not yet been issued or made available for issuance. The Company is currently evaluating the effect that ASU 2022-03 will have on its Consolidated Financial Statements. In March 2022, the FASB issued ASU 2022-01, Derivatives and Hedging (Topic 815): Fair Value Hedging - Portfolio Layer Method (“ASU 2022-01”) . Current GAAP permits only prepayable financial assets and one or more beneficial interests secured by a portfolio of prepayable financial instruments to be included in a last-of-layer closed portfolio. The amendments in ASU 2022-01 allow nonprepayable financial assets also to be included in a closed portfolio hedged using the portfolio layer method. That expanded scope permits an entity to apply the same portfolio hedging method to both prepayable and nonprepayable financial assets, thereby allowing consistent accounting for similar hedges. The amendments in ASU 2022-01 also clarify the accounting for and promote consistency in the reporting of hedge basis adjustments applicable to both a single hedged layer and multiple hedged layers as follows: (1) an entity is required to maintain basis adjustments in an existing hedge on a closed portfolio basis (that is, not allocated to individual assets), (2) an entity is required to immediately recognize and present the basis adjustment associated with the amount of the designated layer that was breached in interest income. In addition, an entity is required to disclose that amount and the circumstances that led to the breach, (3) an entity is required to disclose the total amount of the basis adjustments in existing hedges as a reconciling amount if other areas of GAAP require the disaggregated disclosure of the amortized cost basis of assets included in the closed portfolio, and (4) an entity is prohibited from considering basis adjustments in an existing hedge when determining credit losses. The guidance is effective for public business entities for fiscal years beginning after December 15, 2022, and interim periods within those fiscal years. Early adoption is permitted on any date on or after the issuance of ASU 2022-01 for any entity that has adopted the amendments in ASU 2017-02 for the corresponding period. The Company is currently evaluating the effect that ASU 2022-01 will have on its Consolidated Financial Statements. |
Business Combination | The Transaction was accounted as a reverse merger in accordance with ASC 805, which, among other things, requires assets acquired and liabilities assumed to be measured at their acquisition date fair value. The Company also adopted ASU 2021-08, effective as of January 1, 2022, to record contract liabilities at their carrying value as of the acquisition date. Although the Company was the legal acquirer, BCP was determined to be the accounting acquirer and legal acquiree. As a result, BCP and its subsidiaries’ net assets were carried at historical value, acquired net assets were measured at fair value except contract liabilities being recorded at carrying value at the acquisition date, and results of operations of ALTM and its subsidiaries were included in the Company’s Condensed Consolidated Financial Statements from the Closing Date going forward. The preliminary purchase price allocation is based on an assessment of the fair value of the assets acquired and liabilities assumed in the acquisition using inputs that are not observable in the market and thus Level 3 inputs. The fair value of the processing plant, gathering system and related facilities and equipment are based on market and cost approaches. The goodwill of $4.6 million relates to operational synergies and is included in the Midstream Logistics segment. The value of the Preferred Units and assumed contingent liability is determined through a probability-weighted analysis of the expected future cash flows and other applicable valuation techniques. See additional details for Preferred Units in Note 11—Series A Cumulative Redeemable Preferred Units and contingent liabilities in Note 8—Commitments and Contingencies in the Notes to our Condensed Consolidated Financial Statements in this Form 10-Q. Certain data necessary to complete the purchase price allocation is not yet available, including, but not limited to, valuation of the underlying assets of the equity method investments and liabilities assumed. However, the Company is continuing its review of these matters during the measurement period, and if new information obtained about facts and circumstances that existed at the acquisition date identifies adjustments to the liabilities initially recognized, as well as any additional liabilities that existed at the acquisition date, the acquisition accounting will be revised to reflect the resulting adjustments to the provisional amounts initially recognized. The Company will finalize the purchase price allocation during the 12-month period following the acquisition date. |
Revenue Recognition | Current and noncurrent contract liabilities are included in “Other Current Liabilities” and “Contract Liabilities,” respectively, of the Condensed Consolidated Balance Sheets. The Company has capitalized certain costs incurred to obtain a contract that would not have been incurred if the contract had not been obtained. These costs are recovered through the net cash flows of the associated contract. Current and noncurrent contract cost assets are included in “Prepaid and Other Current Assets” and “Deferred Charges and Other Assets,” respectively, of the Condensed Consolidated Balance Sheets. The Company amortizes these assets as cost of sales on a straight-line basis over the life of the associated long-term customer contract. |
Property, Plant and Equipment | Property, plant and equipment are carried at cost or fair market value at the date of acquisition less accumulated depreciation. The cost basis of constructed assets includes materials, labor, and other direct costs. Major improvements or betterment are capitalized, while repairs that do not improve the life of the respective assets are expensed as incurred. Depreciation and amortization are computed using the straight-line method over the estimated useful lives of the assets.The cost of property classified as “Construction in progress” is excluded from capitalized costs being depreciated. |
Goodwill | Goodwill is tested at least annually as of December 31 of each year, or more frequently as events occur or circumstances change that would more-likely-than-not reduce fair value of a reporting unit below its carrying value. |
Debt and Financing Cost | The aggregate fees, expenses, and original issue discount paid to obtain the Notes totaled $21.5 million and were capitalized as debt issuance cost and included in the Condensed Consolidated Balance Sheets as a direct deduction to the NotesIn obtaining the RCA, the Partnership incurred fees and expenses totaling $7.8 million, which was capitalized and included in the Condensed Consolidated Balance Sheets as “Deferred charges and other assets.the Partnership incurred fee and expenses totaled $7.6 million, which was capitalized as debt issuance cost and included in the Condensed Consolidated Balance Sheets as a direct deduction to the Term Loan Credit FacilityAs of September 30, 2022, the unamortized debt issuance costs associated with the new revolving credit facilities were included in the “Deferred charges and other assets” of the Condensed Consolidated Balance SheetsAs of December 31, 2021, the current and non-current portion of the unamortized debt issuance costs were included in the “Other non-current assets” and “Deferred charges and other assets” of the Condensed Consolidated Balance Sheets. The amortization of the debt issuance costs was charged to interest expense for the periods presented. |
Commitments and Contingencies | Accruals for loss contingencies arising from claims, assessments, litigation, environmental, and other sources are recorded when it is probable that a liability has been incurred and the amount can be reasonably estimated. These accruals are adjusted as additional information becomes available or circumstances change. The Company is a party to various legal actions arising in the ordinary course of its businesses. In accordance with ASC 450, Contingencies , the Company accrues reserves for outstanding lawsuits, claims, and proceedings when a loss contingency is probable and can be reasonably estimated. The Company estimates the amount of loss contingencies using current available information from legal proceedings, advice from legal counsel and available insurance coverage. Due to the inherent subjectivity of the assessments and unpredictability of the outcomes of the legal proceedings, any amounts accrued or included in this aggregate amount may not represent the ultimate loss to the Company from the legal proceedings in question. Thus, the Company’s exposure and ultimate losses may be higher, and possibly significantly more, than the amounts accrued. |
Equity and Warrants | Therefore, the Common Unit is accounted for as redeemable noncontrolling interest and classified as temporary equity on the Company’s Condensed Consolidated Balance Sheet.All corresponding per-share and share amounts, excluding the Transaction, for periods prior to June 8, 2022 have been retroactively restated in this Form 10-Q to reflect the Stock Split. |
Share-Based Compensation | The Class A Shares, Class C Shares and Replacement Awards were valued based on the Company’s publicly quoted stock price on the measurement date, which was the Closing Date of the Transaction. During 2022, pursuant to the Company’s 2019 Omnibus Compensation Plan, as amended from time to time (the “Plan”) , the Company granted a total of 13,941 restricted stock units (“RSUs”) to certain members of the Board, which were vested immediately on grant date, and granted a total of 14,144 RSUs to new employees, which are subject to a vesting period between one |
Income Tax | The Company accounts for income taxes in accordance with ASC 740—Income Taxes, which prescribes a minimum recognition threshold a tax position must meet before being recognized in the financial statements. |
Fair Value Measurements | The Company’s financial assets and liabilities measured at fair value on a recurring basis include cash and cash equivalents, accrued receivables, accounts receivable, accounts receivable from affiliates, dividends and distributions payable, interest rate and commodity swap derivatives, and Company’s private and public warrants and an embedded derivative liability related to the issuance of Preferred Units. Topic 820 establishes a framework for measuring fair value in U.S. GAAP, clarifies the definition of fair value within that framework, and requires disclosures about the use of fair value measurements. Topic 820 defines fair value as the price that would be received to sell an asset, or paid to transfer a liability, in an orderly transaction between market participants at the measurement date. Topic 820 provides a framework for measuring fair value, establishes a three-level hierarchy for fair value measurements based upon the transparency of inputs to the valuation of an asset or liability as of the measurement date and requires consideration of the counterparty’s creditworthiness when valuing certain assets. Topic 820 establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets (Level 1 inputs). The three levels of the fair value hierarchy under Topic 820 are described below: Level 1 inputs : Unadjusted, quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities. An active market is defined as a market where transactions for the financial instrument occur with sufficient frequency and volume to provide pricing information on an ongoing basis. Level 2 inputs : Inputs, other than quoted prices in active markets, that are either directly or indirectly observable for the asset or liability through correlation with market data at the measurement date and for the duration of the instrument’s anticipated life. Level 3 inputs : Prices or valuations that require unobservable inputs that are both significant to the fair value measurement and unobservable. Valuation under Level 3 generally involves a significant degree of judgment from management. |
BUSINESS COMBINATION (Tables)
BUSINESS COMBINATION (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Business Combinations [Abstract] | |
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed | The following table summarizes the preliminary estimated fair value of assets acquired and liabilities assumed in the Transaction in accordance with ASC 805: (In thousands) Amount Cash and cash equivalent $ 13,401 Accounts receivable 1,919 Accounts receivable - affiliates 15,681 Property, plant, and equipment, net 634,923 Intangible assets, net 13,200 Investments in unconsolidated affiliates 1,755,000 Prepaid expense and other assets 7,748 Goodwill 4,557 Total assets acquired 2,446,429 Accrued expenses and other accrued liabilities 5,687 Long-term debt 657,000 Embedded derivative liabilities 89,050 Contract liabilities 9,102 Mandatory redeemable Preferred Units 200,667 Deferred tax liabilities 4,010 Contingent liabilities 4,451 Total liabilities assumed 969,967 Redeemable noncontrolling interest - Preferred Unit limited partners 462,717 Total consideration transferred $ 1,013,745 |
Schedule of Pro Forma Information | The unaudited supplemental pro forma financials are for informational purposes only and are not indicative of future results. The results below for the three and nine months ended September 30, 2022 and 2021 combine the results of the Company and the Partnership, giving effect to the Transaction as if it had been completed on January 1, 2021. Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 (In thousands) Pro forma Pro forma Pro forma Pro forma Revenues $ 325,176 $ 201,134 $ 944,850 $ 554,742 Net income including noncontrolling interest $ 46,968 $ 28,518 $ 193,083 $ 64,165 |
REVENUE RECOGNITION (Tables)
REVENUE RECOGNITION (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Revenue from Contract with Customer [Abstract] | |
Summary of Disaggregation of Revenue | The following table presents a disaggregation of the Company’s revenue: Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 (In thousands) Gathering and processing services $ 107,597 $ 72,578 $ 290,122 $ 202,482 Natural gas, NGLs and condensate sales 213,803 93,266 618,382 244,358 Other revenue 3,776 742 9,493 3,615 Total revenues and other $ 325,176 $ 166,586 $ 917,997 $ 450,455 |
Schedule of Remaining Performance Obligation, Expected Timing of Satisfaction | The following table presents our estimated revenue from contracts with customers for remaining performance obligations that has not yet been recognized, representing our contractually committed revenues as of September 30, 2022: Amount Fiscal Year (In thousands) Remaining of 2022 $ 2,151 2023 44,597 2024 40,247 2025 47,898 2026 34,631 Thereafter 191,293 $ 360,817 |
Schedule of Contract with Customer, Contract Liability | The following table provides information about contract liabilities from contracts with customers as of September 30, 2022: Amount (In thousands) Balance at December 31, 2021 $ 14,756 Reclassification of beginning contract liabilities to revenue as a result of performance obligation being satisfied (5,159) Cash received and not recognized as revenue 20,268 Balance at September 30, 2022 29,865 Less: Current portion 7,158 Non-current portion $ 22,707 |
PROPERTY, PLANT AND EQUIPMENT (
PROPERTY, PLANT AND EQUIPMENT (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property, Plant and Equipment | Property, plant and equipment, at carrying value, is as follows: September 30, 2022 December 31, 2021 (In thousands) Gathering, processing and transmission systems and facilities $ 2,850,062 $ 2,121,434 Vehicles 8,026 6,090 Computers and equipment 4,255 4,271 Less: accumulated depreciation (437,049) (337,030) Total depreciable assets, net 2,425,294 1,794,765 Construction in progress 82,834 24,888 Land 20,531 19,626 Total property, plant and equipment, net $ 2,528,659 $ 1,839,279 |
GOODWILL AND INTANGIBLE ASSET_2
GOODWILL AND INTANGIBLE ASSETS, NET (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Finite-Lived Intangible Assets | Intangible assets, net are comprised of the following: September 30, 2022 December 31, 2021 (In thousands) Customer contracts $ 1,136,728 $ 1,135,963 Right of way assets 125,164 99,345 Less accumulated amortization (539,501) (449,259) Total amortizable intangible assets, net $ 722,391 $ 786,049 |
DEBT AND FINANCING COSTS - (Tab
DEBT AND FINANCING COSTS - (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Debt | The following table summarizes the Company’s debt obligations as of September 30, 2022 and December 31, 2021: September 30, 2022 December 31, 2021 (In thousands) $2.0 billion unsecured term loan $ 2,000,000 $ — $1.0 billion 2030 senior unsecured Notes 1,000,000 — $1.25 billion revolving credit facility 475,000 — $1.25 billion term loan — 1,175,417 $690 million term loan — 639,393 $513 million term loan — 479,377 $125 million revolving line of credit — 52,000 Total Long-term debt 3,475,000 2,346,187 Less: Debt issuance costs, net (1) (27,487) (38,485) 3,447,513 2,307,702 Less: Current portion, net — (54,280) Long-term portion of debt and finance lease obligations, net $ 3,447,513 $ 2,253,422 |
Schedule of Financing Costs, Net | The table below presents the components of the Company’s financing costs, net of capitalized interest: Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 (In thousands) Capitalized interest $ 961 $ 226 $ 1,262 $ 712 Debt issuance costs 1,515 3,354 8,053 9,991 Interest expense 37,988 26,961 83,270 77,755 Total financing costs, net of capitalized interest $ 40,464 $ 30,541 $ 92,585 $ 88,458 |
ACCRUED EXPENSES (Tables)
ACCRUED EXPENSES (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Payables and Accruals [Abstract] | |
Components of Accrued Expenses | The following table provides detail of the Company’s accrued expenses at September 30, 2022 and December 31, 2021: September 30, 2022 December 31, 2021 (In thousands) Accrued product purchases $ 175,575 $ 118,364 Accrued taxes 19,442 4,299 Accrued salaries, vacation, and related benefits 4,616 2,113 Accrued capital expenditures 8,713 2,995 Accrued interest expenses 19,120 — Accrued other expenses 7,694 7,872 Total accrued expenses $ 235,160 $ 135,643 |
EQUITY METHOD INVESTMENTS (Tabl
EQUITY METHOD INVESTMENTS (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Schedule of Equity Method Investments | As of September 30, 2022, the Company owned investments in the following long-haul pipeline entities in the Permian Basin. These investments were accounted for using the equity method of accounting. For each EMI pipeline entity, the Company has the ability to exercise significant influence based on certain governance provisions and its participation in the significant activities and decisions that impact the management and economic performance of the EMI pipeline. The table below presents the ownership percentages and investment balances held by the Company for each entity: Ownership September 30, 2022 December 31, 2021 (In thousands) Permian Highway Pipeline LLC (1) 53.3% $ 1,459,096 $ 626,477 Breviloba, LLC (Shin Oak) 33.0% 462,691 — Gulf Coast Express Pipeline LLC 16.0% 450,809 — $ 2,372,596 $ 626,477 (1) Ownership for PHP was 53.3% and 26.7% as of September 30, 2022 and December 31, 2021, respectively. The following table presents the activity in the Company’s EMIs for the nine months ended September 30, 2022: Permian Highway Pipeline LLC Breviloba, LLC Gulf Coast Express Pipeline LLC Total (2) (In thousands) Balance at December 31, 2021 $ 626,477 $ — $ — $ 626,477 Acquisitions 815,000 470,000 470,000 1,755,000 Contributions 56,199 — — 56,199 Distributions (125,526) (25,810) (34,450) (185,786) Equity income, net (1) 86,946 18,501 15,259 120,706 Balance at September 30, 2022 $ 1,459,096 $ 462,691 $ 450,809 $ 2,372,596 (1) For the nine months ended September 30, 2022, net of amortization of basis differences and capitalized interests, which represents undistributed earnings, the amortization was $5.3 million from Permian Highway Pipeline LLC, $0.5 million from Breviloba, LLC and $10.4 million from Gulf Coast Express Pipeline, LLC. (2) The EMIs acquired in the Transaction are included in the results from February 22, 2022 to September 30, 2022, and this is also the case for the additional 26.67% of PHP that was acquired in the Transaction. The results of the legacy ALTM business are not included in the Company’s consolidated financials prior to February 22, 2022. Refer to Note 1—Description of the Organization and Summary of Significant Accounting Policies in the Notes to our Condensed Consolidated Financial Statements of this Form 10-Q, for further information on the Company’s basis of presentation . |
Schedule of Equity Method Investment, Summarized Financial Information | The following tables represent selected statement of operations data for the Company’s EMI pipelines (on a 100 percent basis) for the three and nine months ended September 30, 2022 and 2021. Three Months Ended September 30, 2022 2021 Permian Highway Pipeline LLC Breviloba, LLC Gulf Coast Express Pipeline LLC Permian Highway Pipeline LLC (1) Breviloba, LLC (1) Gulf Coast Express Pipeline LLC (1) (In thousands) Revenues $ 100,114 $ 53,120 $ 91,800 $ 99,918 $ 45,054 $ 91,454 Operating income 69,851 22,205 70,870 61,987 26,796 65,482 Net income 69,926 22,060 70,742 61,753 26,617 65,145 Nine Months Ended September 30, 2022 2021 Permian Highway Pipeline LLC Breviloba, LLC Gulf Coast Express Pipeline LLC Permian Highway Pipeline LLC (1) Breviloba, LLC (1) Gulf Coast Express Pipeline LLC (1) (In thousands) Revenues $ 296,779 $ 151,732 272,542 $ 297,132 $ 127,030 $ 270,526 Operating income 190,620 73,877 199,130 167,011 72,098 186,356 Net income 190,446 73,711 198,732 166,662 71,621 185,464 (1) For the three and nine months ended September 30, 2021, the Company only had equity interest in Permian Highway Pipeline LLC. |
SERIES A CUMULATIVE REDEEMABL_2
SERIES A CUMULATIVE REDEEMABLE PREFERRED UNITS (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Equity [Abstract] | |
Schedule of Preferred Units | Activities related to Preferred Units for the nine months ended September 30, 2022 are as follows: Units Outstanding Amount (In thousands, except for unit data) Redeemable noncontrolling interest — Preferred Units, immediately upon Closing of Transaction (1) 396,417 $ 462,717 Redemption, including PIK units (396,417) (461,460) Cash distribution paid to Preferred Unit limited partners — (6,937) Allocation of net income — 18,128 Accreted redemption value adjustment — 97,075 Excess of carrying amount over redemption price — (109,523) Redeemable noncontrolling interest — Preferred Units, as of September 30, 2022 — $ — (1) Included 21,417 PIK units on a pro rata basis. |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Income Tax Disclosure [Abstract] | |
Schedule of Total Income Tax Provision (Benefit) | The Company is subject to U.S. federal income tax and the Texas margin tax. Income tax expense included in the Condensed Consolidated Financial Statements in this Form 10-Q is as follows: Three Months Ended September 30, Nine Months Ended September 30, 2022 2022 (In thousands) Income before income taxes $ 50,828 $ 204,503 Income tax expense $ 1,406 $ 2,244 Effective tax rate (1) 2.77 % 1.10 % |
Schedule of Unrecognized Tax Benefits | Reconciliation of the beginning and ending amount of unrecognized tax benefit is as follows: (In thousands) Amount Balance at December 31, 2021 $ — Increase related to ALTM acquisition 5,238 Reduction related to current year activities (5,238) Balance at September 30, 2022 $ — |
NET INCOME PER SHARE (Tables)
NET INCOME PER SHARE (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Earnings Per Share [Abstract] | |
Schedule of Net (Loss) Per Share | The computation of basic and diluted net income per share for the periods presented in the Condensed Consolidated Financial Statements is shown in the tables below. Three Months Ended September 30, 2022 2021 Income Weighted-average shares (3) Per Share Income Weighted-average shares (3) Per Share (In thousands, except per share data) Basic: Net income attributable to Class A common shareholders $ 14,936 41,816 $ 0.36 $ — — $ — Less: Net income available to participating unvested restricted Class A common shareholders (4) (4,174) — $ — — — $ — Excess preferred carrying amount over consideration paid (5) 32,900 — $ — — — $ — Total net income attributable to Class A common shareholders $ 43,662 41,816 $ 1.04 $ — — $ — Effect of dilutive securities: Unvested Class A common shares — 39 $ — — — $ — Diluted (1)(2) : Net income attributable to Class A common shareholders $ 43,662 41,855 $ 1.04 $ — — $ — Nine Months Ended September 30, 2022 2021 Income Weighted-average shares (3) Per Share Income Weighted-average share (3) Per Share (In thousands, except per share data) Basic: Net income attributable to Class A common shareholders $ 25,239 40,042 $ 0.63 $ — — $ — Less: Net income available to participating unvested restricted Class A common shareholders (4) (8,358) — $ — — — $ — Excess preferred carrying amount over consideration paid (5) 32,900 — $ — — — $ — Total net income attributable to Class A common shareholders $ 49,781 40,042 $ 1.24 $ — — $ — Effect of dilutive securities: Unvested Class A common shares — 33 $ — — — $ — Diluted (1)(2) : Net income attributable to Class A common shareholders $ 49,781 40,075 $ 1.24 $ — — $ — (1) The effect of an assumed exchange of the outstanding public and private warrants for shares of Class A Common Stock would have been anti-dilutive for all periods presented in which the public and private warrants were outstanding. (2) The effect of an assumed exchange of outstanding Common Units (and the cancellation of a corresponding number of shares of outstanding Class C Common Stock) would have been anti-dilutive for all periods presented in which the Common Units were outstanding. (3) Share amounts have been retroactively restated to reflect the Company’s two-for-one Stock Split. Refer to Note 10—Equity and Warrants in the Notes to our Condensed Consolidated Financial Statements in this Form 10-Q for further information. (4) Represents dividends paid to unvested restricted Class A common shareholders. (5) Represented excess of carrying value of redeemable noncontrolling interest Preferred Units over redemption price at redemption. |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis | The following tables present financial assets and liabilities that are measured at fair value on a recurring basis as of September 30, 2022 and December 31, 2021: September 30, 2022 Level 1 Level 2 Level 3 Total (In thousands) Public warrants $ 126 $ — $ — $ 126 Private warrants — — 95 95 Total liabilities $ 126 $ — $ 95 $ 221 December 31, 2021 Level 1 Level 2 Level 3 Total (In thousands) Commodity swaps $ — $ 205 $ — $ 205 Interest rate derivatives — 2,662 — 2,662 Contingent liabilities — — 839 839 Total liabilities $ — $ 2,867 $ 839 $ 3,706 |
SEGMENTS (Tables)
SEGMENTS (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information, by Segment | The following tables present the reconciliation of the segment profit measure as of and for the three and nine months ended September 30, 2022 and 2021: Midstream Logistics Pipeline Transportation Corporate and Other (1) Consolidated (2) For the three months ended September 30, 2022 (In thousands) Segment net income (loss) including noncontrolling interests $ 65,525 $ 44,750 $ (60,853) $ 49,422 Add back: Interest expense 7 — 40,457 40,464 Income tax expense — — 1,406 1,406 Depreciation and amortization 64,655 345 5 65,005 Contract assets amortization 448 — — 448 Proportionate EMI EBITDA — 78,357 — 78,357 Share-based compensation — — 12,661 12,661 Loss on disposal of assets 3,946 — — 3,946 Integration costs 14 81 2,243 2,338 Acquisition transaction costs 5 — 57 62 Other one-time costs or amortization 2,945 162 645 3,752 Deduct: Gain on embedded derivative — — 488 488 Equity income from unconsolidated affiliates — 45,003 — 45,003 Segment adjusted EBITDA $ 137,545 $ 78,692 $ (3,867) $ 212,370 Midstream Logistics Pipeline Transportation Corporate and Other (1) Consolidated (2) For the three months ended September 30, 2021 (In thousands) Segment net income (loss) including noncontrolling interests $ (6,210) $ 13,333 $ (2,483) $ 4,640 Add back: Interest expense 27,682 2,859 — 30,541 Income tax expense 1,207 — — 1,207 Depreciation and amortization 57,026 128 — 57,154 Contract assets amortization 448 — — 448 Proportionate EMI EBITDA — 21,704 — 21,704 Loss (gain) on disposal of assets (60) 23 — (37) Loss on debt extinguishment 56 — — 56 Other one-time costs or amortization 802 160 205 1,167 Deduct: Interest and other income 74 — — 74 Equity income from unconsolidated affiliates — 16,826 — 16,826 Segment adjusted EBITDA $ 80,877 $ 21,381 $ (2,278) $ 99,980 Midstream Logistics Pipeline Transportation Corporate and Other (1) Consolidated (2) For the nine months ended September 30, 2022 (In thousands) Segment net income (loss) including noncontrolling interests $ 89,274 $ 120,162 $ (7,177) $ 202,259 Add back: Interest expense 47,411 (664) 45,838 92,585 Income tax expense (benefit) 457 (39) 1,826 2,244 Depreciation and amortization 192,007 597 5 192,609 Contract assets amortization 1,344 — — 1,344 Proportionate EMI EBITDA — 190,438 — 190,438 Share-based compensation — — 30,966 30,966 Loss (gain) on disposal of assets 12,636 — (34) 12,602 Loss (gain) on debt extinguishment 27,983 (8) — 27,975 Integration costs 933 81 8,998 10,012 Acquisition transaction costs 9 — 6,403 6,412 Other one-time costs or amortization 8,865 162 1,942 10,969 Deduct: Gain on redemption of mandatorily redeemable Preferred units — — 9,580 9,580 Gain on embedded derivative — — 89,050 89,050 Equity income from unconsolidated affiliates — 120,706 — 120,706 Segment adjusted EBITDA $ 380,919 $ 190,023 $ (9,863) $ 561,079 Midstream Logistics Pipeline Transportation Corporate and Other (1) Consolidated (2) For the nine months ended September 30, 2021 (In thousands) Segment net income (loss) including noncontrolling interests $ (22,238) $ 37,072 $ (7,424) $ 7,410 Add back: Interest expense 82,967 5,491 — 88,458 Income tax expense 1,207 — — 1,207 Depreciation and amortization 169,906 385 — 170,291 Contract assets amortization 1,815 — — 1,815 Proportionate EMI EBITDA — 59,677 — 59,677 Loss on disposal of assets 394 23 — 417 Gain on debt extinguishment (4) — — (4) Derivatives loss due to Winter Storm Uri 13,456 — — 13,456 Other one-time costs or amortization 1,675 182 153 2,010 Producer settlement 6,827 — — 6,827 Deduct: Interest and other income 115 — — 115 Equity income from unconsolidated affiliates — 44,692 — 44,692 Segment adjusted EBITDA $ 255,890 $ 58,138 $ (7,271) $ 306,757 (1) Corporate and Other represents those results that: (i) are not specifically attributable to a reportable segment; (ii) are not individually reportable or (iii) have not been allocated to a reportable segment for the purpose of evaluating their performance, including certain general and administrative expense items. (2) Results do not include legacy ALTM prior to February 22, 2022. Refer to Note 1 —Description of the Organization and Summary of Significant Accounting Policies in the Notes to our Condensed Consolidated Financial Statements in this Form 10-Q, for further information on the Company’s basis of presentation. Adjusted EBITDA is a non-GAAP measure; please see Key Performance Metrics in Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations of this Form 10-Q, for a definition and reconciliation to the GAAP measure. The following tables present the revenue for individual operating segment for the three and nine months ended September 30, 2022 and 2021: Midstream Logistics Pipeline Transportation Consolidated For the three months ended September 30, 2022 (In thousands) Revenue $ 320,667 $ 733 $ 321,400 Other revenue 3,774 2 3,776 Total segment operating revenue $ 324,441 $ 735 $ 325,176 Midstream Logistics Pipeline Transportation Consolidated For the three months ended September 30, 2021 (In thousands) Revenue $ 165,844 $ — $ 165,844 Other revenue 740 2 742 Total segment operating revenue $ 166,584 $ 2 $ 166,586 Midstream Logistics Pipeline Transportation Consolidated For the nine months ended September 30, 2022 (In thousands) Revenue $ 907,771 $ 733 $ 908,504 Other revenue 9,487 6 9,493 Total segment operating revenue $ 917,258 $ 739 $ 917,997 Midstream Logistics Pipeline Transportation Consolidated For the nine months ended September 30, 2021 (In thousands) Revenue $ 446,840 $ — $ 446,840 Other revenue 3,609 6 3,615 Total segment operating revenue $ 450,449 $ 6 $ 450,455 The following table presents total assets for each operating segment as of September 30, 2022 and December 31, 2021: September 30, 2022 December 31, 2021 (In thousands) Midstream Logistics $ 3,575,642 $ 2,916,774 Pipeline Transportation 2,417,663 635,784 Segment total assets 5,993,305 3,552,558 Corporate and other 13,873 648 Total assets $ 6,007,178 $ 3,553,206 |
DESCRIPTION OF THE ORGANIZATI_3
DESCRIPTION OF THE ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - The Transaction (Details) | Jun. 08, 2022 | Sep. 30, 2022 $ / shares shares | Feb. 22, 2022 $ / shares shares | Dec. 31, 2021 $ / shares shares |
Schedule Of Organization [Line Items] | ||||
Percent of common stock, issued and outstanding, owned | 5% | |||
Class C Common Stock | ||||
Schedule Of Organization [Line Items] | ||||
Common stock, shares issued (in shares) | 94,270,000 | 50,000,000 | 100,000,000 | |
Common stock, par value (in USD per share) | $ / shares | $ 0.0001 | $ 0.0001 | $ 0.0001 | |
Class A Common Stock | ||||
Schedule Of Organization [Line Items] | ||||
Common stock, shares issued (in shares) | 43,082,157 | 0 | ||
Common stock, par value (in USD per share) | $ / shares | $ 0.0001 | $ 0.0001 | $ 0.0001 | |
Common Stock | Class C Common Stock | ||||
Schedule Of Organization [Line Items] | ||||
Stock split, conversion ratio | 2 | |||
Common Stock | Class A Common Stock | ||||
Schedule Of Organization [Line Items] | ||||
Stock split, conversion ratio | 2 | |||
Altus Midstream LP | ||||
Schedule Of Organization [Line Items] | ||||
Common stock, shares issued (in shares) | 50,000,000 | |||
BCP Raptor Holdco, LLC | ||||
Schedule Of Organization [Line Items] | ||||
Percent of common stock, issued and outstanding, owned | 75% | |||
Apache Midstream LLC | ||||
Schedule Of Organization [Line Items] | ||||
Percent of common stock, issued and outstanding, owned | 20% |
DESCRIPTION OF THE ORGANIZATI_4
DESCRIPTION OF THE ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Additional Information (Details) | 3 Months Ended | 9 Months Ended | |||||||||
Jun. 08, 2022 | Sep. 30, 2022 USD ($) $ / shares | Sep. 30, 2021 USD ($) $ / shares shares | Sep. 30, 2022 USD ($) $ / shares | Sep. 30, 2021 USD ($) $ / shares shares | Feb. 22, 2022 USD ($) | Dec. 31, 2021 USD ($) | |||||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | |||||||||||
Recorded cost of sales | [1] | $ 145,208,000 | $ 60,503,000 | $ 418,197,000 | $ 141,011,000 | ||||||
Inventory | 13,100,000 | 13,100,000 | $ 2,100,000 | ||||||||
Impairment of long-lived assets | 0 | $ 0 | 0 | $ 0 | |||||||
Accounts receivable, affiliates | 24,100,000 | 24,100,000 | |||||||||
Revenue from affiliate | 35,200,000 | 81,400,000 | |||||||||
Operating expenses | $ 200,000 | $ 500,000 | |||||||||
Basic (in USD per share) | $ / shares | [1] | $ 1.04 | $ 0 | $ 1.24 | $ 0 | ||||||
Diluted (in USD per share) | $ / shares | $ 1.04 | [1] | $ 0 | [1] | $ 1.24 | [1] | $ 0 | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||||||
Contract liability | $ 29,865,000 | $ 29,865,000 | $ 14,756,000 | ||||||||
Highway Pipeline LLC (“PHP”) and Breviloba, LLC | |||||||||||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | |||||||||||
Recorded cost of sales | $ 3,700,000 | $ 10,800,000 | |||||||||
Class A Common Stock | |||||||||||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | |||||||||||
Shares outstanding (in shares) | shares | 0 | 0 | |||||||||
Common Stock | Class A Common Stock | |||||||||||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | |||||||||||
Stock split, conversion ratio | 2 | ||||||||||
Accounting Standards Update 2021-08 | |||||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||||||
Contract liability | $ 9,100,000 | ||||||||||
[1]The results of the legacy ALTM business are not included in the Company’s consolidated financials prior to February 22, 2022. Refer to the basis of presentation in Note 1—Description of the Organization and Summary of Significant Accounting Policies in the Notes to our Condensed Consolidated Financial Statements in this Form 10-Q for further information. |
DESCRIPTION OF THE ORGANIZATI_5
DESCRIPTION OF THE ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Redeemable Noncontrolling Interest (Details) - $ / shares | Sep. 30, 2022 | Feb. 22, 2022 | Dec. 31, 2021 |
Class C Common Stock | |||
Class of Stock [Line Items] | |||
Common stock, shares issued (in shares) | 94,270,000 | 50,000,000 | 100,000,000 |
Common stock, par value (in USD per share) | $ 0.0001 | $ 0.0001 | $ 0.0001 |
Altus Midstream LP | |||
Class of Stock [Line Items] | |||
Common stock, shares issued (in shares) | 50,000,000 |
BUSINESS COMBINATION - Addition
BUSINESS COMBINATION - Additional Information (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Feb. 22, 2022 | Dec. 31, 2021 | |
Business Acquisition [Line Items] | ||||||
Goodwill | $ 4,557 | $ 4,557 | $ 0 | |||
BCP and BCP GP | ||||||
Business Acquisition [Line Items] | ||||||
Goodwill | 4,600 | 4,600 | $ 4,557 | |||
Acquisition-related transaction costs | 100 | $ 100 | 6,400 | $ 31,200 | ||
Reversal of acquisition related expenses | $ 1,500 | $ 21,000 | ||||
Class C Common Stock | ||||||
Business Acquisition [Line Items] | ||||||
Common stock, shares issued (in shares) | 94,270,000 | 94,270,000 | 50,000,000 | 100,000,000 | ||
Common stock, par value (in USD per share) | $ 0.0001 | $ 0.0001 | $ 0.0001 | $ 0.0001 | ||
Altus Midstream LP | ||||||
Business Acquisition [Line Items] | ||||||
Common stock, shares issued (in shares) | 50,000,000 |
BUSINESS COMBINATION - Allocati
BUSINESS COMBINATION - Allocation of Acquisition Costs to Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Feb. 22, 2022 | Dec. 31, 2021 |
Business Acquisition [Line Items] | |||
Goodwill | $ 4,557 | $ 0 | |
BCP and BCP GP | |||
Business Acquisition [Line Items] | |||
Cash and cash equivalent | $ 13,401 | ||
Accounts receivable | 1,919 | ||
Accounts receivable - affiliates | 15,681 | ||
Property, plant, and equipment, net | 634,923 | ||
Intangible assets, net | 13,200 | ||
Investments in unconsolidated affiliates | 1,755,000 | ||
Prepaid expense and other assets | 7,748 | ||
Goodwill | $ 4,600 | 4,557 | |
Total assets acquired | 2,446,429 | ||
Accrued expenses and other accrued liabilities | 5,687 | ||
Long-term debt | 657,000 | ||
Embedded derivative liabilities | 89,050 | ||
Contract liabilities | 9,102 | ||
Mandatory redeemable Preferred Units | 200,667 | ||
Deferred tax liabilities | 4,010 | ||
Contingent liabilities | 4,451 | ||
Total liabilities assumed | 969,967 | ||
Redeemable noncontrolling interest - Preferred Unit limited partners | 462,717 | ||
Total consideration transferred | $ 1,013,745 |
BUSINESS COMBINATION - Pro Form
BUSINESS COMBINATION - Pro Forma (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Business Combination and Asset Acquisition [Abstract] | ||||
Revenues | $ 325,176 | $ 201,134 | $ 944,850 | $ 554,742 |
Net income including noncontrolling interest | $ 46,968 | $ 28,518 | $ 193,083 | $ 64,165 |
REVENUE RECOGNITION - Disaggreg
REVENUE RECOGNITION - Disaggregation of Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | ||
Disaggregation of Revenue [Line Items] | |||||
Total operating revenues | [1] | $ 325,176 | $ 166,586 | $ 917,997 | $ 450,455 |
Gathering and processing services | |||||
Disaggregation of Revenue [Line Items] | |||||
Total operating revenues | 107,597 | 72,578 | 290,122 | 202,482 | |
Natural gas, NGLs and condensate sales | |||||
Disaggregation of Revenue [Line Items] | |||||
Total operating revenues | 213,803 | 93,266 | 618,382 | 244,358 | |
Other revenue | |||||
Disaggregation of Revenue [Line Items] | |||||
Total operating revenues | [1] | $ 3,776 | $ 742 | $ 9,493 | $ 3,615 |
[1]The results of the legacy ALTM business are not included in the Company’s consolidated financials prior to February 22, 2022. Refer to the basis of presentation in Note 1—Description of the Organization and Summary of Significant Accounting Policies in the Notes to our Condensed Consolidated Financial Statements in this Form 10-Q for further information. |
REVENUE RECOGNITION - Narrative
REVENUE RECOGNITION - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | ||
Disaggregation of Revenue [Line Items] | ||||||
Total operating revenues | [1] | $ 325,176 | $ 166,586 | $ 917,997 | $ 450,455 | |
Capitalized contract cost | 15,300 | 15,300 | $ 18,400 | |||
Amortization of contract costs | 400 | 400 | 1,344 | 1,815 | ||
Minimum Volume Commitments | ||||||
Disaggregation of Revenue [Line Items] | ||||||
Total operating revenues | $ 700 | $ 0 | $ 1,000 | $ 2,500 | ||
[1]The results of the legacy ALTM business are not included in the Company’s consolidated financials prior to February 22, 2022. Refer to the basis of presentation in Note 1—Description of the Organization and Summary of Significant Accounting Policies in the Notes to our Condensed Consolidated Financial Statements in this Form 10-Q for further information. |
REVENUE RECOGNITION - Remaining
REVENUE RECOGNITION - Remaining Performance Obligations (Details) $ in Thousands | Sep. 30, 2022 USD ($) |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligations | $ 360,817 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-10-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligations | $ 2,151 |
Expected timing of satisfaction, period | 3 months |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligations | $ 44,597 |
Expected timing of satisfaction, period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligations | $ 40,247 |
Expected timing of satisfaction, period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2025-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligations | $ 47,898 |
Expected timing of satisfaction, period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2026-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligations | $ 34,631 |
Expected timing of satisfaction, period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2027-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligations | $ 191,293 |
Expected timing of satisfaction, period |
REVENUE RECOGNITION - Contract
REVENUE RECOGNITION - Contract Liabilities (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2022 | Dec. 31, 2021 | |
Contract with Customer, Liability [Roll Forward] | ||
Beginning balance | $ 14,756 | |
Reclassification of beginning contract liabilities to revenue as a result of performance obligation being satisfied | (5,159) | |
Cash received and not recognized as revenue | 20,268 | |
Ending balance | 29,865 | |
Less: Current portion | 7,158 | |
Non-current portion | $ 22,707 | $ 11,674 |
PROPERTY, PLANT AND EQUIPMENT_2
PROPERTY, PLANT AND EQUIPMENT (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Property, Plant and Equipment [Line Items] | |||||
Less: accumulated depreciation | $ (437,049) | $ (437,049) | $ (337,030) | ||
Total depreciable assets, net | 2,425,294 | 2,425,294 | 1,794,765 | ||
Total property, plant and equipment, net | 2,528,659 | 2,528,659 | 1,839,279 | ||
Depreciation expense | 34,900 | $ 26,800 | 102,400 | $ 79,000 | |
Gathering, processing and transmission systems and facilities | |||||
Property, Plant and Equipment [Line Items] | |||||
Total property, plant and equipment, gross | 2,850,062 | 2,850,062 | 2,121,434 | ||
Vehicles | |||||
Property, Plant and Equipment [Line Items] | |||||
Total property, plant and equipment, gross | 8,026 | 8,026 | 6,090 | ||
Computers and equipment | |||||
Property, Plant and Equipment [Line Items] | |||||
Total property, plant and equipment, gross | 4,255 | 4,255 | 4,271 | ||
Construction in progress | |||||
Property, Plant and Equipment [Line Items] | |||||
Total property, plant and equipment, gross | 82,834 | 82,834 | 24,888 | ||
Land | |||||
Property, Plant and Equipment [Line Items] | |||||
Total property, plant and equipment, gross | $ 20,531 | $ 20,531 | $ 19,626 |
GOODWILL AND INTANGIBLE ASSET_3
GOODWILL AND INTANGIBLE ASSETS, NET - Narrative (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Feb. 22, 2022 | Dec. 31, 2021 | |
Business Acquisition [Line Items] | ||||||
Goodwill | $ 4,557,000 | $ 4,557,000 | $ 0 | |||
Finite-Lived Intangible Assets [Line Items] | ||||||
Initial term | 10 years | |||||
Option to renewal | 10 years | |||||
Percent of original consideration paid | 130% | 130% | ||||
Amortization of intangible assets | $ 30,100,000 | $ 30,400,000 | $ 90,200,000 | $ 91,300,000 | ||
Impairment of intangible assets | 0 | $ 0 | $ 0 | $ 0 | ||
Right of way assets | ||||||
Finite-Lived Intangible Assets [Line Items] | ||||||
Useful life | 10 years | |||||
Minimum | ||||||
Finite-Lived Intangible Assets [Line Items] | ||||||
Remaining term | 1 year | |||||
Maximum | ||||||
Finite-Lived Intangible Assets [Line Items] | ||||||
Remaining term | 20 years | |||||
BCP and BCP GP | ||||||
Business Acquisition [Line Items] | ||||||
Goodwill | $ 4,600,000 | $ 4,600,000 | $ 4,557,000 |
GOODWILL AND INTANGIBLE ASSET_4
GOODWILL AND INTANGIBLE ASSETS, NET - Intangible Asset (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Finite-Lived Intangible Assets [Line Items] | ||
Less accumulated amortization | $ (539,501) | $ (449,259) |
Total amortizable intangible assets, net | 722,391 | 786,049 |
Customer contracts | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total amortizable intangible assets, gross | 1,136,728 | 1,135,963 |
Right of way assets | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total amortizable intangible assets, gross | $ 125,164 | $ 99,345 |
DEBT AND FINANCING COSTS - Addi
DEBT AND FINANCING COSTS - Additional Information (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||||
Jun. 15, 2027 | Jun. 08, 2022 | Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Debt Instrument [Line Items] | |||||||
Deferred financing costs | $ 27,487,000 | $ 27,487,000 | $ 38,485,000 | ||||
Gain (loss) on extinguishment of debt | 0 | $ (56,000) | (27,975,000) | $ 4,000 | |||
Debt, fair value | 3,020,000,000 | 3,020,000,000 | $ 2,340,000,000 | ||||
Amortization of debt issuance costs | $ 1,515,000 | $ 3,354,000 | $ 8,053,000 | $ 9,991,000 | |||
Revolving Credit Facility | One-Month SOFR | |||||||
Debt Instrument [Line Items] | |||||||
Effective percentage | 1% | ||||||
Revolving Credit Facility | One-Month SOFR | Minimum | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument, basis spread on variable rate | 0.25% | ||||||
Revolving Credit Facility | One-Month SOFR | Maximum | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument, basis spread on variable rate | 1% | ||||||
Revolving Credit Facility | One, Three or Six-Month SOFR | |||||||
Debt Instrument [Line Items] | |||||||
Effective percentage | 0.10% | ||||||
Revolving Credit Facility | One, Three or Six-Month SOFR | Minimum | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument, basis spread on variable rate | 1.25% | ||||||
Revolving Credit Facility | One, Three or Six-Month SOFR | Maximum | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument, basis spread on variable rate | 2% | ||||||
Revolving Credit Facility | Overnight Bank Funding Rate | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument, basis spread on variable rate | 0.50% | ||||||
Term Loan Credit Facility | One-Month SOFR | |||||||
Debt Instrument [Line Items] | |||||||
Effective percentage | 1% | ||||||
Term Loan Credit Facility | One-Month SOFR | Minimum | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument, basis spread on variable rate | 0.25% | ||||||
Term Loan Credit Facility | One-Month SOFR | Maximum | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument, basis spread on variable rate | 1% | ||||||
Term Loan Credit Facility | One, Three or Six-Month SOFR | |||||||
Debt Instrument [Line Items] | |||||||
Effective percentage | 0.10% | ||||||
Term Loan Credit Facility | One, Three or Six-Month SOFR | Minimum | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument, basis spread on variable rate | 1.25% | ||||||
Term Loan Credit Facility | One, Three or Six-Month SOFR | Maximum | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument, basis spread on variable rate | 2% | ||||||
Term Loan Credit Facility | Overnight Bank Funding Rate | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument, basis spread on variable rate | 0.50% | ||||||
Additional Percent Added | Revolving Credit Facility | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument, interest rate, increase (decrease) | 0.05% | ||||||
If Neither of the Sustainability Performance Targets as Set Forth | Revolving Credit Facility | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument, interest rate, increase (decrease) | 0.05% | ||||||
If Only One of the Sustainability Performance Targets as Set Forth | Revolving Credit Facility | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument, interest rate, increase (decrease) | 0% | ||||||
If Both of the Sustainability Performance Targets as Set Forth | Revolving Credit Facility | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument, interest rate, increase (decrease) | (0.05%) | ||||||
Senior Notes | 5.875% Senior Notes Due 2030 | |||||||
Debt Instrument [Line Items] | |||||||
Face amount | $ 1,000,000,000 | ||||||
Stated percentage | 5.875% | ||||||
Debt instrument, redemption price, percentage | 99.588% | ||||||
Fee, expense, and original issue discounts | $ 21,500,000 | ||||||
Senior Notes | 5.875% Senior Notes Due 2030 | Forecast | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument, interest rate, increase (decrease) | 0.25% | ||||||
Senior Notes | 5.875% Senior Notes Due 2030 | Forecast | Additional Increase if Sustainability Performance Targets are Met | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument, interest rate, increase (decrease) | 0.083% | ||||||
Unsecured Debt | Revolving Credit Facility | |||||||
Debt Instrument [Line Items] | |||||||
Debt maximum borrowing capacity | $ 1,250,000,000 | ||||||
Unsecured Debt | Revolving Credit Facility | Minimum | |||||||
Debt Instrument [Line Items] | |||||||
Line of credit facility, unused capacity, commitment fee percentage | 0.15% | ||||||
Unsecured Debt | Revolving Credit Facility | Maximum | |||||||
Debt Instrument [Line Items] | |||||||
Line of credit facility, unused capacity, commitment fee percentage | 0.35% | ||||||
Unsecured Debt | Term Loan Credit Facility | |||||||
Debt Instrument [Line Items] | |||||||
Debt maximum borrowing capacity | $ 2,000,000,000 | ||||||
Deferred financing costs | $ 7,600,000 | ||||||
Line of Credit | |||||||
Debt Instrument [Line Items] | |||||||
Gain (loss) on extinguishment of debt | $ 28,000,000 | ||||||
Term Loan | Additional Percent Added | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument, interest rate, increase (decrease) | 0.05% | ||||||
Term Loan | If Neither of the Sustainability Performance Targets as Set Forth | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument, interest rate, increase (decrease) | 0.05% | ||||||
Term Loan | If Only One of the Sustainability Performance Targets as Set Forth | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument, interest rate, increase (decrease) | 0% | ||||||
Term Loan | If Both of the Sustainability Performance Targets as Set Forth | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument, interest rate, increase (decrease) | (0.05%) |
DEBT AND FINANCING COSTS - Sche
DEBT AND FINANCING COSTS - Schedule of Long-Term Debt (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Jun. 08, 2022 | Dec. 31, 2021 |
Debt Instrument [Line Items] | |||
Total Long-term debt | $ 3,475,000 | $ 2,346,187 | |
Less: Debt issuance costs, net | (27,487) | (38,485) | |
Debt outstanding | 3,447,513 | 2,307,702 | |
Less: Current portion, net | 0 | (54,280) | |
Long-term debt, net | 3,447,513 | 2,253,422 | |
$2.0 billion unsecured term loan | |||
Debt Instrument [Line Items] | |||
Face amount | 2,000,000 | ||
$1.0 billion 2030 senior unsecured Notes | |||
Debt Instrument [Line Items] | |||
Face amount | 1,000,000 | ||
Total Long-term debt | 1,000,000 | 0 | |
$1.25 billion revolving credit facility | |||
Debt Instrument [Line Items] | |||
Face amount | 1,250,000 | ||
$1.25 billion revolving credit facility | Revolving Credit Facility | |||
Debt Instrument [Line Items] | |||
Unamortized debt issuance cost | 7,300 | $ 7,800 | |
$690 million term loan | |||
Debt Instrument [Line Items] | |||
Face amount | 690,000 | ||
$513 million term loan | |||
Debt Instrument [Line Items] | |||
Face amount | 513,000 | ||
$125 million revolving line of credit | |||
Debt Instrument [Line Items] | |||
Debt maximum borrowing capacity | 125,000 | ||
$125 million revolving line of credit | Revolving Credit Facility | |||
Debt Instrument [Line Items] | |||
Unamortized debt issuance cost | 2,200 | ||
Term Loan | $2.0 billion unsecured term loan | |||
Debt Instrument [Line Items] | |||
Total Long-term debt | 2,000,000 | 0 | |
Term Loan | $1.25 billion revolving credit facility | |||
Debt Instrument [Line Items] | |||
Total Long-term debt | 475,000 | 0 | |
Term Loan | $1.25 billion term loan | |||
Debt Instrument [Line Items] | |||
Face amount | 1,250,000 | ||
Total Long-term debt | 0 | 1,175,417 | |
Term Loan | $690 million term loan | |||
Debt Instrument [Line Items] | |||
Total Long-term debt | 0 | 639,393 | |
Term Loan | $513 million term loan | |||
Debt Instrument [Line Items] | |||
Total Long-term debt | 0 | 479,377 | |
Line of Credit | $125 million revolving line of credit | |||
Debt Instrument [Line Items] | |||
Total Long-term debt | $ 0 | $ 52,000 |
DEBT AND FINANCING COSTS - Sc_2
DEBT AND FINANCING COSTS - Schedule of Financing Costs, Net of Capitalized Interest (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Debt Disclosure [Abstract] | ||||
Capitalized interest | $ 961 | $ 226 | $ 1,262 | $ 712 |
Debt issuance costs | 1,515 | 3,354 | 8,053 | 9,991 |
Interest expense | 37,988 | 26,961 | 83,270 | 77,755 |
Total financing costs, net of capitalized interest | $ 40,464 | $ 30,541 | $ 92,585 | $ 88,458 |
ACCRUED EXPENSES (Details)
ACCRUED EXPENSES (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Payables and Accruals [Abstract] | ||
Accrued product purchases | $ 175,575 | $ 118,364 |
Accrued taxes | 19,442 | 4,299 |
Accrued salaries, vacation, and related benefits | 4,616 | 2,113 |
Accrued capital expenditures | 8,713 | 2,995 |
Accrued interest expenses | 19,120 | 0 |
Accrued other expenses | 7,694 | 7,872 |
Accrued expenses | $ 235,160 | $ 135,643 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details) - USD ($) | Feb. 22, 2022 | Jun. 11, 2019 | Sep. 30, 2022 | Dec. 31, 2021 |
Loss Contingencies [Line Items] | ||||
Loss contingency accrual | $ 0 | $ 0 | ||
Permian Gas | ||||
Loss Contingencies [Line Items] | ||||
Maximum annual amount to be paid | $ 60,500,000 | |||
Consideration transferred | $ 3,900,000 | |||
Contingent liabilities | 0 | $ 800,000 | ||
Altus Midstream LP | Class A Common Stock | ||||
Loss Contingencies [Line Items] | ||||
Contingent liabilities | $ 4,500,000 | |||
Equity interest issuable (in shares) | 2,500,000 | |||
Altus Midstream LP | Class A Common Stock | Price Option One | ||||
Loss Contingencies [Line Items] | ||||
Equity interest issuable (in shares) | 1,250,000 | |||
Trading period | 30 days | |||
Stock price trigger (in USD per share) | $ 140 | |||
Threshold trading days | 20 days | |||
Altus Midstream LP | Class A Common Stock | Price Option Two | ||||
Loss Contingencies [Line Items] | ||||
Equity interest issuable (in shares) | 1,250,000 | |||
Trading period | 30 days | |||
Stock price trigger (in USD per share) | $ 160 | |||
Threshold trading days | 20 days | |||
Winter Storm Uri | ||||
Loss Contingencies [Line Items] | ||||
Outstanding receivable | $ 19,600,000 |
EQUITY METHOD INVESTMENTS - Inf
EQUITY METHOD INVESTMENTS - Information of Equity Method Investments (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Feb. 22, 2022 | Dec. 31, 2021 | ||
Schedule of Equity Method Investments [Line Items] | |||||||
Equity method interests | $ 2,372,596,000 | $ 2,372,596,000 | $ 626,477,000 | ||||
Difference between carrying amount and underlying equity | 349,800,000 | 349,800,000 | 0 | ||||
Capitalized interest | 12,500,000 | 12,500,000 | $ 12,800,000 | ||||
Movement In Equity Method Interests [Roll Forward] | |||||||
Beginning balance | 626,477,000 | ||||||
Acquisitions | 1,755,000,000 | ||||||
Contributions | 56,199,000 | ||||||
Distributions | (185,786,000) | ||||||
Equity income, net | [1] | 45,003,000 | $ 16,826,000 | 120,706,000 | $ 44,692,000 | ||
Ending balance | $ 2,372,596,000 | $ 2,372,596,000 | |||||
Permian Highway Pipeline (“PHP”) | |||||||
Movement In Equity Method Interests [Roll Forward] | |||||||
Ownership percentage by noncontrolling owners | 26.67% | ||||||
Permian Highway Pipeline LLC | |||||||
Schedule of Equity Method Investments [Line Items] | |||||||
Ownership percentage | 53.30% | 53.30% | 26.70% | ||||
Equity method interests | $ 1,459,096,000 | $ 1,459,096,000 | $ 626,477,000 | ||||
Movement In Equity Method Interests [Roll Forward] | |||||||
Beginning balance | 626,477,000 | ||||||
Acquisitions | 815,000,000 | ||||||
Contributions | 56,199,000 | ||||||
Distributions | (125,526,000) | ||||||
Equity income, net | 86,946,000 | ||||||
Ending balance | $ 1,459,096,000 | 1,459,096,000 | |||||
Amortization | $ (5,300,000) | ||||||
Breviloba, LLC (Shin Oak) | |||||||
Schedule of Equity Method Investments [Line Items] | |||||||
Ownership percentage | 33% | 33% | |||||
Equity method interests | $ 462,691,000 | $ 462,691,000 | 0 | ||||
Movement In Equity Method Interests [Roll Forward] | |||||||
Beginning balance | 0 | ||||||
Acquisitions | 470,000,000 | ||||||
Contributions | 0 | ||||||
Distributions | (25,810,000) | ||||||
Equity income, net | 18,501,000 | ||||||
Ending balance | $ 462,691,000 | 462,691,000 | |||||
Amortization | $ (500,000) | ||||||
Gulf Coast Express Pipeline LLC | |||||||
Schedule of Equity Method Investments [Line Items] | |||||||
Ownership percentage | 16% | 16% | |||||
Equity method interests | $ 450,809,000 | $ 450,809,000 | $ 0 | ||||
Movement In Equity Method Interests [Roll Forward] | |||||||
Beginning balance | 0 | ||||||
Acquisitions | 470,000,000 | ||||||
Contributions | 0 | ||||||
Distributions | (34,450,000) | ||||||
Equity income, net | 15,259,000 | ||||||
Ending balance | $ 450,809,000 | 450,809,000 | |||||
Amortization | $ (10,400,000) | ||||||
EPIC Crude Holdings, LP | |||||||
Schedule of Equity Method Investments [Line Items] | |||||||
Ownership percentage | 15% | 15% | |||||
[1]The results of the legacy ALTM business are not included in the Company’s consolidated financials prior to February 22, 2022. Refer to the basis of presentation in Note 1—Description of the Organization and Summary of Significant Accounting Policies in the Notes to our Condensed Consolidated Financial Statements in this Form 10-Q for further information. |
EQUITY METHOD INVESTMENTS - Sum
EQUITY METHOD INVESTMENTS - Summarized Financial Information of Equity Method Investments (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | ||
Schedule of Equity Method Investments [Line Items] | |||||
Operating income | [1] | $ 45,801 | $ 16,040 | $ 105,477 | $ 48,238 |
Net income | [1] | 49,422 | 4,640 | 202,259 | 7,410 |
Permian Highway Pipeline LLC | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Revenues | 100,114 | 99,918 | 296,779 | 297,132 | |
Operating income | 69,851 | 61,987 | 190,620 | 167,011 | |
Net income | 69,926 | 61,753 | 190,446 | 166,662 | |
Breviloba, LLC | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Revenues | 53,120 | 45,054 | 151,732 | 127,030 | |
Operating income | 22,205 | 26,796 | 73,877 | 72,098 | |
Net income | 22,060 | 26,617 | 73,711 | 71,621 | |
Gulf Coast Express Pipeline LLC | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Revenues | 91,800 | 91,454 | 272,542 | 270,526 | |
Operating income | 70,870 | 65,482 | 199,130 | 186,356 | |
Net income | $ 70,742 | $ 65,145 | $ 198,732 | $ 185,464 | |
[1]The results of the legacy ALTM business are not included in the Company’s consolidated financials prior to February 22, 2022. Refer to the basis of presentation in Note 1—Description of the Organization and Summary of Significant Accounting Policies in the Notes to our Condensed Consolidated Financial Statements in this Form 10-Q for further information. |
EQUITY AND WARRANTS (Details)
EQUITY AND WARRANTS (Details) | 7 Months Ended | 9 Months Ended | ||||||||||||||||
Oct. 19, 2022 $ / shares | Jun. 08, 2022 | May 19, 2022 | Sep. 30, 2022 USD ($) $ / shares shares | Sep. 30, 2022 USD ($) $ / shares shares | Sep. 30, 2021 USD ($) shares | Jun. 30, 2022 USD ($) shares | Feb. 22, 2022 $ / shares shares | Dec. 31, 2021 USD ($) $ / shares shares | Jun. 30, 2021 USD ($) shares | Dec. 31, 2020 USD ($) shares | ||||||||
Class of Stock [Line Items] | ||||||||||||||||||
Notice period to redeem warrants | 30 days | |||||||||||||||||
Threshold trading days | 20 days | |||||||||||||||||
Trading period | 30 days | |||||||||||||||||
Derivatives fair value adjustment | $ | $ 0 | |||||||||||||||||
Percent of distributions or dividends reinvested in newly issued Class A shares | 100% | |||||||||||||||||
Class A Common Stock issued through dividend and distribution reinvestment plan | $ | $ 175,453,000 | $ 0 | ||||||||||||||||
Public warrants | ||||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||||
Number of warrant outstanding (in shares) | 12,577,350 | 12,577,350 | ||||||||||||||||
Redemption price of warrants (in USD per share) | $ / shares | $ 0.01 | $ 0.01 | ||||||||||||||||
Derivatives fair value adjustment | $ | $ 100,000 | |||||||||||||||||
Private warrants | ||||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||||
Number of warrant outstanding (in shares) | 6,364,281 | 6,364,281 | ||||||||||||||||
Derivatives fair value adjustment | $ | $ 100,000 | |||||||||||||||||
Class A Common Stock | ||||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||||
Common stock, shares issued (in shares) | 43,082,157 | 43,082,157 | 0 | |||||||||||||||
Common stock, par value (in USD per share) | $ / shares | $ 0.0001 | $ 0.0001 | $ 0.0001 | $ 0.0001 | ||||||||||||||
Common stock, redemption ratio | 1 | |||||||||||||||||
Common stock, shares outstanding (in shares) | 43,082,157 | 43,082,157 | 0 | |||||||||||||||
Warrant exercise price (in USD per share) | $ / shares | $ 115 | $ 115 | ||||||||||||||||
Percent of required investment | 20% | |||||||||||||||||
Class A Common Stock issued through dividend and distribution reinvestment plan | $ | $ 175,500,000 | |||||||||||||||||
Stock split, additional share issued for each share outstanding (in shares) | 1 | |||||||||||||||||
Class A Common Stock | Subsequent Event | ||||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||||
Dividends declared (in USD per share) | $ / shares | $ 0.75 | |||||||||||||||||
Class A Common Stock | Public warrants | ||||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||||
Class of warrant or right, purchase ratio for common stock | 0.1 | 0.1 | ||||||||||||||||
Class C Common Stock | ||||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||||
Common stock, shares issued (in shares) | 94,270,000 | 94,270,000 | 50,000,000 | 100,000,000 | ||||||||||||||
Common stock, par value (in USD per share) | $ / shares | $ 0.0001 | $ 0.0001 | $ 0.0001 | $ 0.0001 | ||||||||||||||
Common stock, shares outstanding (in shares) | 94,270,000 | 94,270,000 | 100,000,000 | |||||||||||||||
Stock split, additional share issued for each share outstanding (in shares) | 1 | |||||||||||||||||
Common Units limited partners | ||||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||||
Equity, carrying amount | $ | $ 3,061,861,000 | $ 3,061,861,000 | $ 1,033,766,000 | $ 3,251,290,000 | $ 1,006,838,000 | $ 1,029,126,000 | $ 1,041,655,000 | |||||||||||
Common Stock | ||||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||||
Stock price trigger (in USD per share) | $ / shares | $ 180 | $ 180 | ||||||||||||||||
Common Stock | Class A Common Stock | ||||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||||
Common stock, shares outstanding (in shares) | 43,082,000 | [1],[2] | 43,082,000 | [1],[2] | 0 | [1],[2] | 40,551,000 | [1] | 0 | [2] | 0 | [1] | 0 | [2] | ||||
Dividends, cash | $ | $ 25,300,000 | |||||||||||||||||
Stock split, conversion ratio | 2 | |||||||||||||||||
Common Stock | Class C Common Stock | ||||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||||
Issued (in shares) | 5,730,000 | |||||||||||||||||
Common stock, shares outstanding (in shares) | 94,270,000 | [1],[2] | 94,270,000 | [1],[2] | 100,694,000 | [1],[2] | 94,450,000 | [1] | 100,000,000 | 100,694,000 | [1] | 101,198,000 | [2] | |||||
Stock split, conversion ratio | 2 | |||||||||||||||||
Altus Midstream LP | ||||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||||
Common stock, shares issued (in shares) | 50,000,000 | |||||||||||||||||
Apache | Private warrants | ||||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||||
Number of warrant outstanding (in shares) | 3,182,140 | 3,182,140 | ||||||||||||||||
The Partnership | Subsequent Event | ||||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||||
Distribution declared (in USD per share) | $ / shares | $ 0.75 | |||||||||||||||||
[1] Share amounts have been retroactively restated to reflect the Company’s S tock Split (as defined in Note 10 — Equity and Warrants ), which was effected on June 8, 2022. Refer to Note 10—Equity and Warrants in the Notes to our Condensed Consolidated Financial Statements in this Form 10-Q for further information. Share amounts have been retroactively restated to reflect the Company’s Stock Split (as defined in Note 10 — Equity and Warrants ), which was effected on June 8, 2022. Refer to Note 10—Equity and Warrants in the Notes to our Condensed Consolidated Financial Statements in this Form 10-Q for further information. |
SERIES A CUMULATIVE REDEEMABL_3
SERIES A CUMULATIVE REDEEMABLE PREFERRED UNITS - Additional Information (Details) - USD ($) $ in Thousands | 1 Months Ended | 6 Months Ended | |
Feb. 22, 2022 | Jul. 31, 2022 | Jun. 30, 2022 | |
Mandatory Redemption Feature | |||
Class of Stock [Line Items] | |||
Stock redeemed (in shares) | 150,000 | 125,000 | |
Stock redeemed value | $ 30,700 | ||
Preferred Unit limited partners | |||
Class of Stock [Line Items] | |||
Number of preferred units sold (in shares) | 625,000 | ||
Stock redeemed (in shares) | 100,000 | ||
Stock redeemed value | $ 120,100 | ||
Shares outstanding (in shares) | 525,000 | ||
Payments for redemption | $ 461,460 | ||
Paid-in-Kind Units | |||
Class of Stock [Line Items] | |||
Shares outstanding (in shares) | 29,983 | ||
Paid-in-Kind Units | Partnership LPA | |||
Class of Stock [Line Items] | |||
Stock redeemed (in shares) | 8,567 |
SERIES A CUMULATIVE REDEEMABL_4
SERIES A CUMULATIVE REDEEMABLE PREFERRED UNITS - Activity Related to Preferred Units (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 7 Months Ended | 9 Months Ended | |
Feb. 22, 2022 | Jul. 31, 2022 | Sep. 30, 2022 | Sep. 30, 2022 | Sep. 30, 2022 | |
Increase (Decrease) in Temporary Equity [Roll Forward] | |||||
Paid-in-kind (in shares) | 21,417 | ||||
Preferred Unit limited partners | |||||
Movement In Preferred Units [Roll Forward] | |||||
Redeemable noncontrolling interest - preferred units: beginning of period (in shares) | 396,417 | ||||
Redemption (in shares) | (396,417) | ||||
Redeemable noncontrolling interest - preferred units: end of period (in shares) | 396,417 | 0 | 0 | 0 | |
Increase (Decrease) in Temporary Equity [Roll Forward] | |||||
Beginning balance | $ 462,717 | ||||
Redemption, including PIK units | $ (461,460) | ||||
Cash distribution paid to Preferred Unit limited partners | (6,937) | ||||
Allocation of net income | 18,128 | ||||
Accreted redemption value adjustment | 97,075 | ||||
Excess of carrying amount over redemption price | $ 102,586 | (109,523) | $ 109,523 | ||
Ending balance | $ 462,717 | $ 0 | $ 0 | $ 0 |
SHARE-BASED COMPENSATION (Detai
SHARE-BASED COMPENSATION (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||||
Feb. 22, 2022 | Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Share-based compensation | $ 12,661,000 | $ 0 | $ 30,966,000 | $ 0 | ||
Restricted stock units awards | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Granted (in shares) | 14,144 | 0 | ||||
New Employees | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Issued (in shares) | 76,000 | |||||
Board | Restricted stock units awards | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Granted (in shares) | 13,941 | |||||
Minimum | Restricted stock units awards | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Award vesting period | 1 year | |||||
Maximum | Restricted stock units awards | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Award vesting period | 3 years | |||||
Class A Common Stock | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Common stock, shares issued (in shares) | 43,082,157 | 43,082,157 | 0 | |||
Class A Common Stock | Minimum | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Award vesting period | 3 years | |||||
Class A Common Stock | Maximum | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Award vesting period | 4 years | |||||
Class C Common Stock | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Common stock, shares issued (in shares) | 50,000,000 | 94,270,000 | 94,270,000 | 100,000,000 | ||
Award vesting period | 4 years | |||||
Altus Midstream LP | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Common stock, shares issued (in shares) | 50,000,000 | |||||
Class A-1 and Class A-2 Units | Class A Common Stock | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Stock issued for exchange (in shares) | 5,300,000 | |||||
Class A-3 Units | Class A Common Stock | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Stock issued for exchange (in shares) | 326,000 |
INCOME TAXES - Income Tax Expen
INCOME TAXES - Income Tax Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | ||
Income Tax Disclosure [Abstract] | |||||
Income before income taxes | [1] | $ 50,828 | $ 5,847 | $ 204,503 | $ 8,617 |
Income tax expense | [1] | $ 1,406 | $ 1,207 | $ 2,244 | $ 1,207 |
Effective tax rate | 2.77% | 1.10% | |||
[1]The results of the legacy ALTM business are not included in the Company’s consolidated financials prior to February 22, 2022. Refer to the basis of presentation in Note 1—Description of the Organization and Summary of Significant Accounting Policies in the Notes to our Condensed Consolidated Financial Statements in this Form 10-Q for further information. |
INCOME TAXES - Reconciliation o
INCOME TAXES - Reconciliation of Unrecognized Tax Benefits (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2022 USD ($) | |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | |
Balance at December 31, 2021 | $ 0 |
Increase related to ALTM acquisition | 5,238 |
Reduction related to current year activities | (5,238) |
Balance at September 30, 2022 | $ 0 |
NET INCOME PER SHARE (Details)
NET INCOME PER SHARE (Details) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | |||||||
Jun. 08, 2022 | Sep. 30, 2022 USD ($) $ / shares shares | Sep. 30, 2021 USD ($) $ / shares shares | Sep. 30, 2022 USD ($) $ / shares shares | Sep. 30, 2021 USD ($) $ / shares shares | |||||
Basic: | |||||||||
Net income attributable to Class A common shareholders | [1] | $ 14,936 | $ 0 | $ 25,239 | $ 0 | ||||
Net income attributable to Class A common shareholders (in shares) | shares | [1],[2] | 41,816 | 0 | 40,042 | 0 | ||||
Net income attributable to Class A common shareholders (in dollars per share) | $ / shares | $ 0.36 | $ 0 | $ 0.63 | $ 0 | |||||
Less: Net income available to participating unvested restricted Class A common shareholders(4) | $ (4,174) | $ 0 | $ (8,358) | $ 0 | |||||
Excess preferred carrying amount over consideration paid | 32,900 | 0 | 32,900 | 0 | |||||
Net income attributable to vested Class A common shareholders | $ 43,662 | $ 0 | $ 49,781 | $ 0 | |||||
Net income attributable to vested Class A common shareholders (in USD per share) | $ / shares | [1] | $ 1.04 | $ 0 | $ 1.24 | $ 0 | ||||
Effect of dilutive securities: | |||||||||
Unvested Class A common shares | $ 0 | $ 0 | $ 0 | $ 0 | |||||
Replacement awards (in shares) | shares | 39 | 0 | 33 | 0 | |||||
Replacement awards (in USD per share) | $ / shares | $ 0 | $ 0 | $ 0 | $ 0 | |||||
Diluted: | |||||||||
Net income attributable to Class A Common Shareholders | $ 43,662 | $ 0 | $ 49,781 | $ 0 | |||||
Net income (loss) attributable to Class A common shareholders (in shares) | shares | [1],[2] | 41,855 | 0 | 40,075 | 0 | ||||
Net income (loss) attributable to Class A common shareholders (in USD per share) | $ / shares | $ 1.04 | [1] | $ 0 | [1] | $ 1.24 | [1] | $ 0 | ||
Common Stock | Class A Common Stock | |||||||||
Equity, Class of Treasury Stock [Line Items] | |||||||||
Stock split, conversion ratio | 2 | ||||||||
[1]The results of the legacy ALTM business are not included in the Company’s consolidated financials prior to February 22, 2022. Refer to the basis of presentation in Note 1—Description of the Organization and Summary of Significant Accounting Policies in the Notes to our Condensed Consolidated Financial Statements in this Form 10-Q for further information. Note 10 — Equity and Warrants ), which was effected on June 8, 2022. Refer to Note 10 – Equity and Warrants in the Notes to our Condensed Consolidated Financial Statements in this Form 10-Q for further information. |
FAIR VALUE MEASUREMENTS - Asset
FAIR VALUE MEASUREMENTS - Assets and Liabilities Measured at Fair Value on a Recurring Basis (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Liabilities | ||
Warrants outstanding, fair value | $ 200 | |
Total liabilities | 3,779,869 | $ 2,546,358 |
Total liabilities | 0 | 2,700 |
Contingent liabilities | 0 | 839 |
Fair Value, Measurements, Recurring | ||
Liabilities | ||
Total liabilities | 221 | |
Total liabilities | 3,706 | |
Fair Value, Measurements, Recurring | Commodity swaps | ||
Liabilities | ||
Total liabilities | 205 | |
Fair Value, Measurements, Recurring | Interest rate derivatives | ||
Liabilities | ||
Total liabilities | 2,662 | |
Fair Value, Measurements, Recurring | Contingent liabilities | ||
Liabilities | ||
Total liabilities | 839 | |
Fair Value, Measurements, Recurring | Public warrants | ||
Liabilities | ||
Warrants outstanding, fair value | 126 | |
Fair Value, Measurements, Recurring | Private warrants | ||
Liabilities | ||
Warrants outstanding, fair value | 95 | |
Fair Value, Measurements, Recurring | Level 1 | ||
Liabilities | ||
Total liabilities | 126 | |
Total liabilities | 0 | |
Fair Value, Measurements, Recurring | Level 1 | Commodity swaps | ||
Liabilities | ||
Total liabilities | 0 | |
Fair Value, Measurements, Recurring | Level 1 | Interest rate derivatives | ||
Liabilities | ||
Total liabilities | 0 | |
Fair Value, Measurements, Recurring | Level 1 | Contingent liabilities | ||
Liabilities | ||
Total liabilities | 0 | |
Fair Value, Measurements, Recurring | Level 1 | Public warrants | ||
Liabilities | ||
Warrants outstanding, fair value | 126 | |
Fair Value, Measurements, Recurring | Level 1 | Private warrants | ||
Liabilities | ||
Warrants outstanding, fair value | 0 | |
Fair Value, Measurements, Recurring | Level 2 | ||
Liabilities | ||
Total liabilities | 0 | |
Total liabilities | 2,867 | |
Fair Value, Measurements, Recurring | Level 2 | Commodity swaps | ||
Liabilities | ||
Total liabilities | 205 | |
Fair Value, Measurements, Recurring | Level 2 | Interest rate derivatives | ||
Liabilities | ||
Total liabilities | 2,662 | |
Fair Value, Measurements, Recurring | Level 2 | Contingent liabilities | ||
Liabilities | ||
Total liabilities | 0 | |
Fair Value, Measurements, Recurring | Level 2 | Public warrants | ||
Liabilities | ||
Warrants outstanding, fair value | 0 | |
Fair Value, Measurements, Recurring | Level 2 | Private warrants | ||
Liabilities | ||
Warrants outstanding, fair value | 0 | |
Fair Value, Measurements, Recurring | Level 3 | ||
Liabilities | ||
Total liabilities | 95 | |
Total liabilities | 839 | |
Fair Value, Measurements, Recurring | Level 3 | Commodity swaps | ||
Liabilities | ||
Total liabilities | 0 | |
Fair Value, Measurements, Recurring | Level 3 | Interest rate derivatives | ||
Liabilities | ||
Total liabilities | 0 | |
Fair Value, Measurements, Recurring | Level 3 | Contingent liabilities | ||
Liabilities | ||
Total liabilities | $ 839 | |
Fair Value, Measurements, Recurring | Level 3 | Public warrants | ||
Liabilities | ||
Warrants outstanding, fair value | 0 | |
Fair Value, Measurements, Recurring | Level 3 | Private warrants | ||
Liabilities | ||
Warrants outstanding, fair value | $ 95 |
FAIR VALUE MEASUREMENTS - Addit
FAIR VALUE MEASUREMENTS - Additional Information (Details) - USD ($) | 3 Months Ended | 7 Months Ended | 9 Months Ended | |||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2022 | Sep. 30, 2021 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Gain on embedded derivative | [1] | $ 488,000 | $ 0 | $ 89,050,000 | $ 0 | |
Warrants outstanding, fair value | $ 200,000 | $ 200,000 | $ 200,000 | |||
Change in fair value of warrants | $ 0 | |||||
[1]The results of the legacy ALTM business are not included in the Company’s consolidated financials prior to February 22, 2022. Refer to the basis of presentation in Note 1—Description of the Organization and Summary of Significant Accounting Policies in the Notes to our Condensed Consolidated Financial Statements in this Form 10-Q for further information. |
DERIVATIVES AND HEDGING ACTIV_2
DERIVATIVES AND HEDGING ACTIVITIES (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Derivative liability | $ 0 | $ 0 | $ 2,700,000 | ||
Derivative cash settlement | (11,115,000) | $ 17,959,000 | |||
Interest Rate Swap | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Derivative cash settlement | 0 | $ (700,000) | 11,300,000 | (2,200,000) | |
Unrealized gains | 0 | 14,000,000 | 3,100,000 | ||
Unrealized losses | (26,000) | ||||
Commodity Swap | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Derivative liability | 0 | 0 | $ 200,000 | ||
Derivative cash settlement | 0 | (900,000) | (200,000) | (15,800,000) | |
Unrealized gains | 0 | 0 | |||
Unrealized losses | $ 0 | $ 600,000 | $ 0 | $ 17,100,000 |
SEGMENTS (Details)
SEGMENTS (Details) | 3 Months Ended | 9 Months Ended | |||||||
Sep. 30, 2022 USD ($) pipeline stream | Sep. 30, 2021 USD ($) | Sep. 30, 2022 USD ($) pipeline Segment stream | Sep. 30, 2021 USD ($) | Dec. 31, 2021 USD ($) | |||||
Segment Reporting [Abstract] | |||||||||
Number of operating segments | Segment | 2 | ||||||||
Segment Reporting Information [Line Items] | |||||||||
Net income including noncontrolling interests | [1] | $ 49,422,000 | $ 4,640,000 | $ 202,259,000 | $ 7,410,000 | ||||
Income tax expense (benefit) | [1] | 1,406,000 | 1,207,000 | 2,244,000 | 1,207,000 | ||||
Depreciation and amortization | [1] | 65,005,000 | 57,154,000 | 192,609,000 | 170,291,000 | ||||
Share-based compensation | 12,661,000 | 0 | 30,966,000 | 0 | |||||
Loss (gain) on disposal of assets | 3,946,000 | [1] | (37,000) | [1] | 12,602,000 | [1] | 417,000 | ||
Loss (gain) on debt extinguishment | 0 | 56,000 | 27,975,000 | (4,000) | |||||
Interest and other income | [1] | 0 | 3,578,000 | 250,000 | 4,141,000 | ||||
Unrealized gain (loss) on embedded derivative | [1] | 488,000 | 0 | 89,050,000 | 0 | ||||
Equity income from unconsolidated affiliates | [1] | 45,003,000 | 16,826,000 | 120,706,000 | 44,692,000 | ||||
Assets | 6,007,178,000 | 6,007,178,000 | $ 3,553,206,000 | ||||||
Operating Segments | |||||||||
Segment Reporting Information [Line Items] | |||||||||
Assets | $ 5,993,305,000 | $ 5,993,305,000 | 3,552,558,000 | ||||||
Operating Segments | Midstream Logistics | |||||||||
Segment Reporting Information [Line Items] | |||||||||
Number of streams in which a segment operates | stream | 3 | 3 | |||||||
Net income including noncontrolling interests | $ 65,525,000 | (6,210,000) | $ 89,274,000 | (22,238,000) | |||||
Interest expense | 7,000 | 27,682,000 | 47,411,000 | 82,967,000 | |||||
Income tax expense (benefit) | 0 | 1,207,000 | 457,000 | 1,207,000 | |||||
Depreciation and amortization | 64,655,000 | 57,026,000 | 192,007,000 | 169,906,000 | |||||
Contract assets amortization | 448,000 | 448,000 | 1,344,000 | 1,815,000 | |||||
Proportionate EMI EBITDA | 0 | 0 | 0 | 0 | |||||
Share-based compensation | 0 | 0 | |||||||
Loss (gain) on disposal of assets | 3,946,000 | (60,000) | 12,636,000 | 394,000 | |||||
Loss (gain) on debt extinguishment | 56,000 | 27,983,000 | (4,000) | ||||||
Integration costs | 14,000 | 933,000 | |||||||
Acquisition transaction costs | 5,000 | 9,000 | |||||||
Other one-time costs or amortization | 2,945,000 | 802,000 | 8,865,000 | 1,675,000 | |||||
Producer settlement | 6,827,000 | ||||||||
Interest and other income | 74,000 | 115,000 | |||||||
Gain on redemption of mandatorily redeemable Preferred units | 0 | ||||||||
Unrealized gain (loss) on embedded derivative | 0 | 0 | (13,456,000) | ||||||
Equity income from unconsolidated affiliates | 0 | 0 | 0 | 0 | |||||
Segment adjusted EBITDA | 137,545,000 | 80,877,000 | 380,919,000 | 255,890,000 | |||||
Revenue from contract with customer | 324,441,000 | 166,584,000 | 917,258,000 | 450,449,000 | |||||
Assets | 3,575,642,000 | 3,575,642,000 | 2,916,774,000 | ||||||
Operating Segments | Midstream Logistics | Product and Service | |||||||||
Segment Reporting Information [Line Items] | |||||||||
Revenue from contract with customer | 320,667,000 | 165,844,000 | 907,771,000 | 446,840,000 | |||||
Operating Segments | Midstream Logistics | Other revenue | |||||||||
Segment Reporting Information [Line Items] | |||||||||
Revenue from contract with customer | $ 3,774,000 | 740,000 | $ 9,487,000 | 3,609,000 | |||||
Operating Segments | Pipeline Transportation | |||||||||
Segment Reporting Information [Line Items] | |||||||||
Number of pipelines with equity investment interest | pipeline | 4 | 4 | |||||||
Net income including noncontrolling interests | $ 44,750,000 | 13,333,000 | $ 120,162,000 | 37,072,000 | |||||
Interest expense | 0 | 2,859,000 | (664,000) | 5,491,000 | |||||
Income tax expense (benefit) | 0 | 0 | (39,000) | 0 | |||||
Depreciation and amortization | 345,000 | 128,000 | 597,000 | 385,000 | |||||
Contract assets amortization | 0 | 0 | 0 | 0 | |||||
Proportionate EMI EBITDA | 78,357,000 | 21,704,000 | 190,438,000 | 59,677,000 | |||||
Share-based compensation | 0 | 0 | |||||||
Loss (gain) on disposal of assets | 0 | 23,000 | 0 | 23,000 | |||||
Loss (gain) on debt extinguishment | 0 | (8,000) | 0 | ||||||
Integration costs | 81,000 | 81,000 | |||||||
Acquisition transaction costs | 0 | 0 | |||||||
Other one-time costs or amortization | 162,000 | 160,000 | 162,000 | 182,000 | |||||
Producer settlement | 0 | ||||||||
Interest and other income | 0 | 0 | |||||||
Gain on redemption of mandatorily redeemable Preferred units | 0 | ||||||||
Unrealized gain (loss) on embedded derivative | 0 | 0 | 0 | ||||||
Equity income from unconsolidated affiliates | 45,003,000 | 16,826,000 | 120,706,000 | 44,692,000 | |||||
Segment adjusted EBITDA | 78,692,000 | 21,381,000 | 190,023,000 | 58,138,000 | |||||
Revenue from contract with customer | 735,000 | 2,000 | 739,000 | 6,000 | |||||
Assets | 2,417,663,000 | 2,417,663,000 | 635,784,000 | ||||||
Operating Segments | Pipeline Transportation | Product and Service | |||||||||
Segment Reporting Information [Line Items] | |||||||||
Revenue from contract with customer | 733,000 | 0 | 733,000 | 0 | |||||
Operating Segments | Pipeline Transportation | Other revenue | |||||||||
Segment Reporting Information [Line Items] | |||||||||
Revenue from contract with customer | 2,000 | 2,000 | 6,000 | 6,000 | |||||
Corporate and Other | |||||||||
Segment Reporting Information [Line Items] | |||||||||
Net income including noncontrolling interests | (60,853,000) | (2,483,000) | (7,177,000) | (7,424,000) | |||||
Interest expense | 40,457,000 | 0 | 45,838,000 | 0 | |||||
Income tax expense (benefit) | 1,406,000 | 0 | 1,826,000 | 0 | |||||
Depreciation and amortization | 5,000 | 0 | 5,000 | 0 | |||||
Contract assets amortization | 0 | 0 | 0 | 0 | |||||
Proportionate EMI EBITDA | 0 | 0 | 0 | 0 | |||||
Share-based compensation | 12,661,000 | 30,966,000 | |||||||
Loss (gain) on disposal of assets | 0 | 0 | (34,000) | 0 | |||||
Loss (gain) on debt extinguishment | 0 | 0 | 0 | ||||||
Integration costs | 2,243,000 | 8,998,000 | |||||||
Acquisition transaction costs | 57,000 | 6,403,000 | |||||||
Other one-time costs or amortization | 645,000 | 205,000 | 1,942,000 | 153,000 | |||||
Producer settlement | 0 | ||||||||
Interest and other income | 0 | 0 | |||||||
Gain on redemption of mandatorily redeemable Preferred units | 9,580,000 | ||||||||
Unrealized gain (loss) on embedded derivative | 488,000 | 89,050,000 | 0 | ||||||
Equity income from unconsolidated affiliates | 0 | 0 | 0 | 0 | |||||
Segment adjusted EBITDA | (3,867,000) | (2,278,000) | (9,863,000) | (7,271,000) | |||||
Assets | 13,873,000 | 13,873,000 | $ 648,000 | ||||||
Consolidated | |||||||||
Segment Reporting Information [Line Items] | |||||||||
Net income including noncontrolling interests | 49,422,000 | 4,640,000 | 202,259,000 | 7,410,000 | |||||
Interest expense | 40,464,000 | 30,541,000 | 92,585,000 | 88,458,000 | |||||
Income tax expense (benefit) | 1,406,000 | 1,207,000 | 2,244,000 | 1,207,000 | |||||
Depreciation and amortization | 65,005,000 | 57,154,000 | 192,609,000 | 170,291,000 | |||||
Contract assets amortization | 448,000 | 448,000 | 1,344,000 | 1,815,000 | |||||
Proportionate EMI EBITDA | 78,357,000 | 21,704,000 | 190,438,000 | 59,677,000 | |||||
Share-based compensation | 12,661,000 | 30,966,000 | |||||||
Loss (gain) on disposal of assets | 3,946,000 | (37,000) | 12,602,000 | 417,000 | |||||
Loss (gain) on debt extinguishment | 56,000 | 27,975,000 | (4,000) | ||||||
Integration costs | 2,338,000 | 10,012,000 | |||||||
Acquisition transaction costs | 62,000 | 6,412,000 | |||||||
Other one-time costs or amortization | 3,752,000 | 1,167,000 | 10,969,000 | 2,010,000 | |||||
Producer settlement | 6,827,000 | ||||||||
Interest and other income | 74,000 | 115,000 | |||||||
Gain on redemption of mandatorily redeemable Preferred units | 9,580,000 | ||||||||
Unrealized gain (loss) on embedded derivative | 488,000 | 89,050,000 | (13,456,000) | ||||||
Equity income from unconsolidated affiliates | 45,003,000 | 16,826,000 | 120,706,000 | 44,692,000 | |||||
Segment adjusted EBITDA | 212,370,000 | 99,980,000 | 561,079,000 | 306,757,000 | |||||
Revenue from contract with customer | 325,176,000 | 166,586,000 | 917,997,000 | 450,455,000 | |||||
Consolidated | Product and Service | |||||||||
Segment Reporting Information [Line Items] | |||||||||
Revenue from contract with customer | 321,400,000 | 165,844,000 | 908,504,000 | 446,840,000 | |||||
Consolidated | Other revenue | |||||||||
Segment Reporting Information [Line Items] | |||||||||
Revenue from contract with customer | $ 3,776,000 | $ 742,000 | $ 9,493,000 | $ 3,615,000 | |||||
[1]The results of the legacy ALTM business are not included in the Company’s consolidated financials prior to February 22, 2022. Refer to the basis of presentation in Note 1—Description of the Organization and Summary of Significant Accounting Policies in the Notes to our Condensed Consolidated Financial Statements in this Form 10-Q for further information. |
SUBSEQUENT EVENTS (Details)
SUBSEQUENT EVENTS (Details) - Subsequent Event | Oct. 19, 2022 $ / shares |
The Partnership | |
Subsequent Event [Line Items] | |
Distribution declared (in USD per share) | $ 0.75 |
Class A Common Stock | |
Subsequent Event [Line Items] | |
Dividends declared (in USD per share) | $ 0.75 |