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Revenues (Notes)
 3 Months Ended
Mar. 31, 2021
Revenue from Contract with Customer [Abstract]  
Revenues RevenuesWe generate revenue by charging fees for gathering, transporting, offloading and storing crude oil; for storing intermediate products and feed stocks; for distributing, transporting and storing refined products; for marketing refined products output of Delek Holdings' Tyler and Big Spring refineries; and for wholesale marketing in the West Texas area. A significant portion of our revenue is derived from long-term commercial agreements with Delek Holdings, which provide for annual fee adjustments for increases or decreases in the CPI, PPI or the FERC index (refer to Note 3 for a more detailed description of these agreements). In addition to the services we provide to Delek Holdings, we also generate substantial revenue from crude oil, intermediate and refined products transportation services for, and terminalling and marketing services to, third parties primarily in Texas, New Mexico, Tennessee and Arkansas. Certain of these services
are provided pursuant to contractual agreements with third parties. Payment terms require customers to pay shortly after delivery and do not contain significant financing components.
The majority of our commercial agreements with Delek Holdings meet the definition of a lease because: (1) performance of the contracts is dependent on specified property, plant or equipment and (2) it is remote that one or more parties other than Delek Holdings will take more than a minor amount of the output associated with the specified property, plant or equipment. As part of our adoption of ASC 842, Leases ("ASC 842"), we applied the permitted practical expedient to not separate lease and non-lease components under the predominance principle to designated asset classes associated with the provision of logistics services. We have determined that the predominant component of the related agreements currently in effect is the lease component. Therefore, the combined component is accounted for under the applicable lease accounting guidance. Of our $462.1 million net property, plant, and equipment balance as of March 31, 2021, $339.2 million is subject to operating leases under our commercial agreements. These agreements do not include options for the lessee to purchase our leasing equipment, nor do they include any material residual value guarantees or material restrictive covenants.
The following table represents a disaggregation of revenue for each reportable segment for the periods indicated (in thousands):
Three Months Ended March 31, 2021
Pipelines and Transportation Wholesale Marketing and Terminalling Consolidated
Service Revenue - Third Party$1,927 $82 $2,009 
Service Revenue - Affiliate (1)
1,224 8,082 9,306 
Product Revenue - Third Party— 54,710 54,710 
Product Revenue - Affiliate— 16,387 16,387 
Lease Revenue - Affiliate 61,824 8,677 70,501 
Total Revenue$64,975 $87,938 $152,913 
(1) Net of $1.8 million of amortization expense for the three months ended March 31, 2021, related to a customer contract intangible asset recorded in the wholesale marketing and terminalling segment.
Three Months Ended March 31, 2020
Pipelines and TransportationWholesale Marketing and Terminalling Consolidated
Service Revenue - Third Party$9,465 $191 $9,656 
Service Revenue - Affiliate (1)
4,888 7,982 12,870 
Product Revenue - Third Party— 47,046 47,046 
Product Revenue - Affiliate— 51,503 51,503 
Lease Revenue - Affiliate 33,614 8,712 42,326 
Total Revenue$47,967 $115,434 $163,401 
(1) Net of $1.8 million of amortization expense for the three months ended March 31, 2020, related to a customer contract intangible asset recorded in the wholesale marketing and terminalling segment.
As of March 31, 2021, we expect to recognize $1.5 billion in lease revenues related to our unfulfilled performance obligations pertaining to the minimum volume commitments and capacity utilization under the non-cancelable terms of our commercial agreements with Delek Holdings. Most of these agreements have an initial term ranging from five to ten years, which may be extended for various renewal terms. We disclose information about remaining performance obligations that have original expected durations of greater than one year.
Our unfulfilled performance obligations as of March 31, 2021 were as follows (in thousands):
Remainder of 2021202,154 
2022250,145 
2023241,631 
2024166,697 
2025 and thereafter$618,965 
Total expected revenue on remaining performance obligations$1,479,592