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Oasis Midstream Partners LP | 12 Months Ended
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Dec. 31, 2018
Related Party Transactions [Abstract] |
Oasis Midstream Partners LP | Oasis Midstream Partners LP Oasis Midstream Partners LP OMP is a growth-oriented, fee-based master limited partnership formed by the Company to own, develop, operate and acquire a diversified portfolio of midstream assets in North America that are inte gral to the oil and natural gas operations of Oasis and are strategically positioned to capture volumes from other producers. Initial public offering of Oasis Midstream Partners LP On September 25, 2017, OMP completed its IPO of 7,500,000 common units representing limited partner interests in OMP at a price of $17.00 per unit. Additionally, on October 10, 2017, OMP issued an additional 1,125,000 common units pursuant to the underwriters’ exercise in full of their option to purchase additional common units at the same price and on the same terms. OMP received net proceeds from the IPO of $134.2 million after deducting underwriting discounts, structuring fees and offering expenses. OMP distributed $132.1 million of the net proceeds to Oasis. The OMP common units are traded on the New York Stock Exchange under the symbol OMP. In exchange for contributed assets, Oasis received 5,125,000 common units and 13,750,000 subordinated units, representing a 68.6% limited partner interest in OMP and the right to receive cash distributions from OMP. In addition to and concurrent with the closing of the IPO, OMP GP retained a non-economic general partnership interest and was issued incentive distribution rights in OMP. Oasis Midstream Partners LP public offering and dropdown On November 14, 2018, OMP completed a public offering of 2,300,000 common units (including 300,000 common units issued pursuant to the underwriters’ option to purchase additional common units) representing limited partnership interests, at a price to the public of $20.00 per common unit. OMP received net proceeds from the public offering of $44.5 million, after deducting underwriting discounts, commissions and offering costs, which were used to fund a portion of its acquisition of additional ownership interest in Bobcat DevCo LLC (“Bobcat DevCo”) and Beartooth DevCo LLC (“Beartooth DevCo”). In connection with the OMP public offering, on November 19, 2018, OMP acquired an additional 15% ownership interest in Bobcat DevCo increasing its ownership to 25% and an additional 30% ownership interest in Beartooth DevCo increasing its ownership to 70% in exchange for consideration of $251.4 million (“OMP Dropdown”). The $251.4 million consideration consisted of $172.4 million in cash and 3,950,000 common units representing limited partner interests in OMP. OMP funded the cash portion of the consideration with a combination of borrowings under the revolving credit facility among OMP, as parent, OMP Operating LLC (“OMP Operating”), a subsidiary of OMP, as borrower, Wells Fargo Bank, N.A., as administrative agent and the lenders party thereto (the “OMP Credit Facility”) and proceeds from its public offering of common units. As a result of the OMP Dropdown, OMS now owns 75% of the non-controlling interests of Bobcat DevCo and 30% of the non-controlling interests of Beartooth DevCo. The effective date of the OMP Dropdown was July 1, 2018, and the OMP Dropdown closed on November 19, 2018. The OMP Dropdown did not have a material impact on the Company’s consolidated financial statements. Class B units in OMP GP On May 22, 2017, OMP GP granted restricted Class B Units to certain employees, including OMP’s executive officers, as consideration for services to Oasis, which vest over a ten-year period. The restricted Class B Units represent 10% of the outstanding units of OMP GP. Compensation expense is recognized ratably over the requisite service period. Contractual arrangements In connection with the OMP IPO, the Company entered into several 15-year, fee-based contractual arrangements with OMP for midstream services, including (i) gas gathering, compression, processing and gas lift services; (ii) crude gathering, stabilization, blending, storage and transportation services; (iii) produced and flowback water gathering and disposal services; and (iv) freshwater supply and distribution services. In addition, the Company provides substantial labor and overhead support for OMP. Upon completion of the OMP IPO, the Company entered into a 15-year services and secondment agreement with OMP pursuant to which the Company provides all personnel, equipment, electricity, chemicals and services (including third-party services) required for OMP to operate such assets, and OMP reimburses the Company for its share of the actual costs of operating such assets. In addition, pursuant to the services and secondment agreement, the Company performs centralized corporate, general and administrative services for OMP, such as legal, corporate recordkeeping, planning, budgeting, regulatory, accounting, billing, business development, treasury, insurance administration and claims processing, risk management, health, safety and environmental, information technology, human resources, investor relations, cash management and banking, payroll, internal audit, taxes and engineering. The Company has also seconded to OMP certain of its employees to operate, construct, manage and maintain its assets, and OMP reimburses the Company for direct general and administrative expenses incurred by the Company for the provision of the above services. The expenses of executive officers and non-executive employees are allocated to OMP based on the amount of time spent managing its business and operations. Assignment of contract for construction of natural gas processing plant On November 6, 2017, OMS agreed to assign to Bighorn DevCo LLC (“Bighorn DevCo”), an indirect, wholly owned subsidiary of OMP, the construction of a second gas processing plant to support Oasis’s production. Pursuant to this assignment, Bighorn DevCo has agreed to assume (i) a fixed price agreement for engineering, procurement and construction of a 200 million standard cubic feet per day natural gas processing plant (the “EPC Agreement” and “Gas Plant II,” respectively), (ii) title to Gas Plant II and the ancillary equipment being constructed under the EPC Agreement, and (iii) a master service agreement and work orders pursuant to which the contractor has agreed to provide mechanical refrigeration units to support Gas Plant II’s operation. In addition, OMP reimbursed OMS for all capital expenditures previously made under the EPC Agreement or otherwise in respect of Gas Plant II totaling $66.7 million. OMP funded the reimbursement with proceeds from the OMP Credit Facility. Finally, the Gas Gathering, Compression, Processing, and Gas Lift Agreement by and among OPNA, OPM, OMS and OMP, dated as of September 25, 2017, was amended to reflect the Gas Plant II’s additional processing capacity. 2019 Capital Expenditures Arrangement On February 22, 2019, the Company entered into a memorandum of understanding (the “MOU”) with OMP regarding the funding of Bobcat DevCo’s expansion capital expenditures for the 2019 calendar year (the “2019 Capital Expenditures Arrangement”). Pursuant to the MOU, in exchange for increasing its percentage ownership interest in Bobcat DevCo, OMP agreed to make up to $80 million of the capital contributions to Bobcat DevCo that OMS would otherwise be required to contribute. In connection with this arrangement, OMS’s percentage ownership interest in Bobcat DevCo is expected to decrease from 75% to between approximately 64% and 66% by the end of the 2019 calendar year. See Note 21 — Subsequent Events for a description of the 2019 Capital Expenditures Arrangement.

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- Definition The entire disclosure for a variable interest entity (VIE), including but not limited to, judgments and assumptions in determining whether to consolidate and in identifying the primary beneficiary, gain (loss) recognized on the initial consolidation of the VIE, terms of arrangements, amounts and classification of the VIE's assets and liabilities, and the entity's maximum exposure to loss. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 810 -URI http://asc.fasb.org/topic&trid=2197479 + Details
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