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Leases Leases | 12 Months Ended
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Dec. 31, 2019
Leases [Abstract] |
Leases | Leases We have cancelable and non-cancelable finance and operating lease liabilities for the lease of land, vehicles, office space, retail facilities, and other facilities used in the storage and transportation of crude oil and refined products. Most of our leases include one or more options to renew, with renewal terms that can extend the lease term from one to 30 years or more. There are no material lease arrangements where we are the lessor and no material residual value guarantees associated with any of our leases. The following table provides information on the amounts (in thousands, except lease term and discount rates) of our leased assets and liabilities as of December 31, 2019 and their placement within our consolidated balance sheets:
Lease type |  | Balance Sheet Location |  | December 31, 2019
Assets |  |  |  |
Finance |  | Property, plant, and equipment |  | $ | 11,552 |
Finance |  | Accumulated amortization |  | (4,447 | )
Finance |  | Property, plant, and equipment, net |  | $ | 7,105 |
Operating |  | Operating lease assets |  | 420,073 |
Total leased assets |  |  |  | $ | 427,178 |
Liabilities |  |  |  |
Current |  |  |  |
Finance |  | Other accrued liabilities |  | $ | 1,784 |
Operating |  | Operating lease liabilities |  | 79,999 |
Long-term |  |  |  |
Finance |  | Finance lease liabilities |  | 6,227 |
Operating |  | Operating lease liabilities |  | 340,909 |
Total lease liabilities |  |  |  | $ | 428,919 |
Weighted-average remaining lease term (in years) |  |
Finance |  |  |  | 5.69 |
Operating |  |  |  | 10.26 |
Weighted-average discount rate |  |
Finance |  |  |  | 6.68 | %
Operating |  |  |  | 7.88 | %
The following table summarizes the lease costs recognized on our consolidated statement of operations (in thousands):
Lease cost type |  | Year Ended December 31, 2019
Finance lease cost |  |
Amortization of finance lease assets |  | $ | 1,896 |
Interest on lease liabilities |  | 521 |
Operating lease cost |  | 100,384 |
Variable lease cost |  | 11,663 |
Short-term lease cost |  | 1,874 |
Net lease cost |  | $ | 116,338 |
The following table summarizes the supplemental cash flow information related to leases as follows (in thousands):
Lease type |  | Year Ended December 31, 2019
Cash paid for amounts included in the measurement of liabilities |  |
Financing cash flows from finance leases |  | $ | 2,167 |
Operating cash flows from finance leases |  | 507 |
Operating cash flows from operating leases |  | 99,713 |
Non-cash supplemental amounts |  |
ROU assets obtained in exchange for new finance lease liabilities |  | 963 |
ROU assets obtained in exchange for new operating lease liabilities |  | 79,382 |
The table below includes the estimated future undiscounted cash flows for finance and operating leases as of December 31, 2019 (in thousands):
For the year ending December 31, |  | Finance leases |  | Operating leases |  | Total
2020 |  | $ | 2,247 |  |  | $ | 109,727 |  |  | $ | 111,974 |
2021 |  | 1,593 |  |  | 69,091 |  |  | 70,684 |
2022 |  | 1,376 |  |  | 66,859 |  |  | 68,235 |
2023 |  | 1,345 |  |  | 53,088 |  |  | 54,433 |
2024 |  | 1,058 |  |  | 43,337 |  |  | 44,395 |
Thereafter |  | 2,004 |  |  | 240,988 |  |  | 242,992 |
Total lease payments |  | 9,623 |  |  | 583,090 |  |  | 592,713 |
Less amount representing interest |  | (1,612 | ) |  | (162,182 | ) |  | (163,794 | )
Present value of lease liabilities |  | $ | 8,011 |  |  | $ | 420,908 |  |  | $ | 428,919 |
Additionally, we have $9.0 million and $1.2 million in future undiscounted cash flows for three operating leases and three finance leases, respectively, that have not yet commenced. These leases are expected to commence when the lessor has made the equipment or location available to us to operate or begin construction, respectively. Due to the transition method elected, information presented prior to January 1, 2019 has not been restated for ASC 842 and continues to be reported under the accounting standards in effect for the period. As of December 31, 2018, we had capital lease obligations related primarily to the leases of 17 retail stations. Most capital leases included one or more options to renew, with renewal terms that could extend the lease term from one to 15 years or more. Certain leases included escalation clauses and/or purchase options. Additionally, as of December 31, 2018, we had various cancelable and noncancelable operating leases related to land, vehicles, office and retail facilities, railcars, barges, and other facilities used in the storage, transportation, and sale of crude oil and refined products. We had operating leases for most of our retail stations with an average of eight years remaining and generally contained renewal options and escalation clauses. Leases for facilities used in the storage, transportation, and sale of crude oil and refined products had various expiration dates extending to 2044. Rent expense for the years ended December 31, 2018 and 2017 was approximately $41.6 million and $41.2 million, respectively. At December 31, 2018, the estimated minimum lease payments for capital and operating leases with initial or remaining non-cancelable lease terms in excess of one year were as follows (in thousands):
| Capital leases |  | Operating leases
2019 | $ | 2,723 |  |  | $ | 62,589 |
2020 | 2,264 |  |  | 62,132 |
2021 | 1,757 |  |  | 39,821 |
2022 | 1,512 |  |  | 38,402 |
2023 | 1,148 |  |  | 38,827 |
Thereafter | 2,600 |  |  | 191,717 |
Total minimum rental payments | $ | 12,004 |  |  | $ | 433,488 |
Less amount representing interest | (1,865 | ) |  |
Present value of minimum rental payments | $ | 10,139 |  |  |
Leases | Leases We have cancelable and non-cancelable finance and operating lease liabilities for the lease of land, vehicles, office space, retail facilities, and other facilities used in the storage and transportation of crude oil and refined products. Most of our leases include one or more options to renew, with renewal terms that can extend the lease term from one to 30 years or more. There are no material lease arrangements where we are the lessor and no material residual value guarantees associated with any of our leases. The following table provides information on the amounts (in thousands, except lease term and discount rates) of our leased assets and liabilities as of December 31, 2019 and their placement within our consolidated balance sheets:
Lease type |  | Balance Sheet Location |  | December 31, 2019
Assets |  |  |  |
Finance |  | Property, plant, and equipment |  | $ | 11,552 |
Finance |  | Accumulated amortization |  | (4,447 | )
Finance |  | Property, plant, and equipment, net |  | $ | 7,105 |
Operating |  | Operating lease assets |  | 420,073 |
Total leased assets |  |  |  | $ | 427,178 |
Liabilities |  |  |  |
Current |  |  |  |
Finance |  | Other accrued liabilities |  | $ | 1,784 |
Operating |  | Operating lease liabilities |  | 79,999 |
Long-term |  |  |  |
Finance |  | Finance lease liabilities |  | 6,227 |
Operating |  | Operating lease liabilities |  | 340,909 |
Total lease liabilities |  |  |  | $ | 428,919 |
Weighted-average remaining lease term (in years) |  |
Finance |  |  |  | 5.69 |
Operating |  |  |  | 10.26 |
Weighted-average discount rate |  |
Finance |  |  |  | 6.68 | %
Operating |  |  |  | 7.88 | %
The following table summarizes the lease costs recognized on our consolidated statement of operations (in thousands):
Lease cost type |  | Year Ended December 31, 2019
Finance lease cost |  |
Amortization of finance lease assets |  | $ | 1,896 |
Interest on lease liabilities |  | 521 |
Operating lease cost |  | 100,384 |
Variable lease cost |  | 11,663 |
Short-term lease cost |  | 1,874 |
Net lease cost |  | $ | 116,338 |
The following table summarizes the supplemental cash flow information related to leases as follows (in thousands):
Lease type |  | Year Ended December 31, 2019
Cash paid for amounts included in the measurement of liabilities |  |
Financing cash flows from finance leases |  | $ | 2,167 |
Operating cash flows from finance leases |  | 507 |
Operating cash flows from operating leases |  | 99,713 |
Non-cash supplemental amounts |  |
ROU assets obtained in exchange for new finance lease liabilities |  | 963 |
ROU assets obtained in exchange for new operating lease liabilities |  | 79,382 |
The table below includes the estimated future undiscounted cash flows for finance and operating leases as of December 31, 2019 (in thousands):
For the year ending December 31, |  | Finance leases |  | Operating leases |  | Total
2020 |  | $ | 2,247 |  |  | $ | 109,727 |  |  | $ | 111,974 |
2021 |  | 1,593 |  |  | 69,091 |  |  | 70,684 |
2022 |  | 1,376 |  |  | 66,859 |  |  | 68,235 |
2023 |  | 1,345 |  |  | 53,088 |  |  | 54,433 |
2024 |  | 1,058 |  |  | 43,337 |  |  | 44,395 |
Thereafter |  | 2,004 |  |  | 240,988 |  |  | 242,992 |
Total lease payments |  | 9,623 |  |  | 583,090 |  |  | 592,713 |
Less amount representing interest |  | (1,612 | ) |  | (162,182 | ) |  | (163,794 | )
Present value of lease liabilities |  | $ | 8,011 |  |  | $ | 420,908 |  |  | $ | 428,919 |
Additionally, we have $9.0 million and $1.2 million in future undiscounted cash flows for three operating leases and three finance leases, respectively, that have not yet commenced. These leases are expected to commence when the lessor has made the equipment or location available to us to operate or begin construction, respectively. Due to the transition method elected, information presented prior to January 1, 2019 has not been restated for ASC 842 and continues to be reported under the accounting standards in effect for the period. As of December 31, 2018, we had capital lease obligations related primarily to the leases of 17 retail stations. Most capital leases included one or more options to renew, with renewal terms that could extend the lease term from one to 15 years or more. Certain leases included escalation clauses and/or purchase options. Additionally, as of December 31, 2018, we had various cancelable and noncancelable operating leases related to land, vehicles, office and retail facilities, railcars, barges, and other facilities used in the storage, transportation, and sale of crude oil and refined products. We had operating leases for most of our retail stations with an average of eight years remaining and generally contained renewal options and escalation clauses. Leases for facilities used in the storage, transportation, and sale of crude oil and refined products had various expiration dates extending to 2044. Rent expense for the years ended December 31, 2018 and 2017 was approximately $41.6 million and $41.2 million, respectively. At December 31, 2018, the estimated minimum lease payments for capital and operating leases with initial or remaining non-cancelable lease terms in excess of one year were as follows (in thousands):
| Capital leases |  | Operating leases
2019 | $ | 2,723 |  |  | $ | 62,589 |
2020 | 2,264 |  |  | 62,132 |
2021 | 1,757 |  |  | 39,821 |
2022 | 1,512 |  |  | 38,402 |
2023 | 1,148 |  |  | 38,827 |
Thereafter | 2,600 |  |  | 191,717 |
Total minimum rental payments | $ | 12,004 |  |  | $ | 433,488 |
Less amount representing interest | (1,865 | ) |  |
Present value of minimum rental payments | $ | 10,139 |  |  |

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- Definition The entire disclosure for finance leases of lessee. Includes, but is not limited to, description of lessee's finance lease and maturity analysis of finance lease liability. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 842 -SubTopic 20 -URI http://asc.fasb.org/subtopic&trid=77888251 + Details
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- Definition The entire disclosure for operating leases of lessee. Includes, but is not limited to, description of operating lease and maturity analysis of operating lease liability. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 842 -SubTopic 20 -URI http://asc.fasb.org/subtopic&trid=77888251 + Details
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