Leases

12 Months Ended

Dec. 31, 2020

Our leases are for land, real estate, railcars, vehicles, pipelines, plant equipment, and office equipment. We have both operating and finance leases with remaining terms ranging from less than one year to 50 years. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants.

The components of lease expense were as follows:


	Years Ended December 31,
(in thousands)		2020		2019
Operating lease cost		$	17,371	$	17,414
Finance lease cost:
Amortization of assets		3,047		2,723
Interest on lease liabilities		417		426
Short-term lease cost		4,665		3,459
Variable lease cost		4,579		3,206
Total lease cost		30,079		$	27,228

Variable lease costs also include leases that do not have a right-of-use asset or lease liability, but are capitalized as part of inventory. Rental expense was $23 million in 2018 under the authoritative accounting guidance in effect during that year.

Supplemental balance sheet information related to leases was as follows:


		December 31,
(in thousands)	Balance Sheet Classification	2020		2019
Operating leases:
Operating lease right-of-use assets	Operating lease right-of-use assets	$	61,329	$	60,505

Current liability	Operating lease liabilities	$	13,410	$	14,036
Noncurrent liability	Operating lease liabilities-noncurrent	48,324		46,792
		$	61,734	$	60,828

Finance leases:
Finance lease right-of-use assets	Deferred charges and other assets	$	10,774	$	12,840

Current liability	Other current liabilities	$	2,142	$	3,019
Noncurrent liability	Other noncurrent liabilities	10,077		11,119
		$	12,219	$	14,138


	December 31,
	2020		2019
Weighted average remaining lease term (in years):
Operating leases	13		14
Finance leases	10		9

Weighted average incremental borrowing rate:
Operating leases	3.33	%	3.88	%
Finance leases	3.05	%	3.41	%

Supplemental cash flow information related to leases was as follows:


	Years Ended December 31,
(in thousands)	2020		2019
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	17,563	$	16,765
Operating cash flows from finance leases	417		426
Financing cash flows from finance leases	3,031		2,649

Right-of-use assets obtained in exchange for new lease obligations:
Operating leases	$	17,694	$	18,826
Finance leases	982		10,555

Maturities of lease liabilities as of December 31, 2020 were as follows:


(in thousands)	Operating Leases		Finance Leases
2021	$	15,093	$	2,463
2022	12,103		1,428
2023	9,854		1,211
2024	6,091		1,164
2025	4,437		1,143
Thereafter	33,426		6,628
Total lease payments	81,004		14,037
Less: imputed interest	19,270		1,818
Total lease obligations	$	61,734	$	12,219

Operating lease payments in the table above include approximately $16 million related to options to extend lease terms that are reasonably certain of being exercised. At December 31, 2020, we have entered into leases that have not yet commenced, but provide for right-of-use assets of approximately $38 million with remaining related lease obligations of $25 million, which are not included in the above table. Most of the commitments relate to plant and equipment that is being constructed or procured by the future lessors. These leases are expected to commence in 2021.