Derivative Financial Instruments (Tables)
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9 Months Ended |
Sep. 30, 2020 |
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| Derivative Instruments and Hedging Activities Disclosure [Abstract] |
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| Schedule Of NYMEX Contracts And Butane Price Swap Purchase Agreements |
Our open futures contracts at September 30, 2020 were as follows: | | | | | | | | | | | | | | | | Type of Contract/Accounting Methodology | | Product Represented by the Contract and Associated Barrels | | Maturity Dates | | | | | | | | | | | | Futures - Economic Hedges | | 3.1 million barrels of refined products and crude oil | | Between October 2020 and November 2022 | | Futures - Economic Hedges | | 0.6 million barrels of gas liquids | | Between October and December 2020 |
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| Derivatives and Offset Amounts |
A schedule of the derivative amounts we have offset and the deposit amounts we could offset under a master netting arrangement are provided below as of December 31, 2019 and September 30, 2020 (in thousands): | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Description | | Gross Amounts of Recognized Liabilities | | Gross Amounts of Assets Offset in the Consolidated Balance Sheets | | Net Amounts of Liabilities Presented in the Consolidated Balance Sheets | | Margin Deposit Amounts Not Offset in the Consolidated Balance Sheets | | Net Asset Amount(1) | | As of 12/31/2019 | | $ | (11,033) | | | $ | 811 | | | $ | (10,222) | | | $ | 27,415 | | | $ | 17,193 | | | As of 9/30/2020 | | $ | (4,386) | | | $ | 2,740 | | | $ | (1,646) | | | $ | 14,031 | | | $ | 12,385 | | | | | | | | | | | | |
(1) Amount represents the maximum loss we would incur if all of our counterparties failed to perform on their derivative contracts.
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| Derivatives and Hedging-Cash Flow Hedges |
The changes in derivative activity included in AOCL for the three and nine months ended September 30, 2019 and 2020 were as follows (in thousands): | | | | | | | | | | | | | | | | | | | | | | | | | Three Months Ended | | Nine Months Ended | | | September 30, | | September 30, | | Derivative Losses Included in AOCL | 2019 | | 2020 | | 2019 | | 2020 | | Beginning balance | $ | (36,287) | | | $ | (57,748) | | | $ | (26,480) | | | $ | (48,960) | | | Net loss on cash flow hedges | (14,181) | | | — | | | (25,216) | | | (10,444) | | | Reclassification of net loss on cash flow hedges to income | 699 | | | 896 | | | 1,927 | | | 2,552 | | | Ending balance | $ | (49,769) | | | $ | (56,852) | | | $ | (49,769) | | | $ | (56,852) | |
The following is a summary of the effect on our consolidated statements of income for the three and nine months ended September 30, 2019 and 2020 of derivatives that were designated as cash flow hedges (in thousands): | | | | | | | | | | | | | | | | | | | | | | | Interest Rate Contracts | | | Amount of Loss Recognized in AOCL on Derivatives | | Location of Loss Reclassified from AOCL into Income | | Amount of Loss Reclassified from AOCL into Income | | Three Months Ended September 30, 2019 | | $ | (14,181) | | | Interest expense | | $ | (699) | | | Three Months Ended September 30, 2020 | | $ | — | | | Interest expense | | $ | (896) | | | Nine Months Ended September 30, 2019 | | $ | (25,216) | | | Interest expense | | $ | (1,927) | | | Nine Months Ended September 30, 2020 | | $ | (10,444) | | | Interest expense | | $ | (2,552) | |
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| Derivatives and Hedging-Overall-Subsequent Measurement |
The following table provides a summary of the effect on our consolidated statements of income for the three and nine months ended September 30, 2019 and 2020 of derivatives that were not designated as hedging instruments (in thousands): | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Amount of Gain (Loss) Recognized on Derivatives | | | | | Three Months Ended | | Nine Months Ended | | | | Location of Gain (Loss)
Recognized on Derivatives | | September 30, | | September 30, | | Derivative Instrument | | | 2019 | | 2020 | | 2019 | | 2020 | | Futures contracts | | Product sales revenue | | $ | 17,626 | | | $ | (7,734) | | | $ | (41,504) | | | $ | 89,280 | | | | | | | | | | | | | | Futures contracts | | Cost of product sales | | (5,581) | | | 1,815 | | | (9,456) | | | (2,529) | | | Basis derivative agreement | | Other operating income (expense) | | (3,910) | | | (3,155) | | | (8,869) | | | (2,654) | | | | Total | | $ | 8,135 | | | $ | (9,074) | | | $ | (59,829) | | | $ | 84,097 | |
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| Derivatives and Hedging-Designated |
The following tables provide a summary of the fair value of derivatives, which are presented on a net basis in our consolidated balance sheets, that were not designated as hedging instruments as of December 31, 2019 and September 30, 2020 (in thousands): | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | December 31, 2019 | | | | Asset Derivatives | | Liability Derivatives | | Derivative Instrument | | Balance Sheet Location | | Fair Value | | Balance Sheet Location | | Fair Value | | Futures contracts | | Commodity derivatives contracts, net | | $ | 811 | | | Commodity derivatives contracts, net | | $ | 11,033 | | | Basis derivative agreement | | Other current assets | | — | | | Other current liabilities | | 8,457 | | | Basis derivative agreement | | Other noncurrent assets | | — | | | Other noncurrent liabilities | | 8,847 | | | | Total | | $ | 811 | | | Total | | $ | 28,337 | | | | | | | | | | | | | | September 30, 2020 | | | | Asset Derivatives | | Liability Derivatives | | Derivative Instrument | | Balance Sheet Location | | Fair Value | | Balance Sheet Location | | Fair Value | | Futures contracts | | Commodity derivatives contracts, net | | $ | 1,095 | | | Commodity derivatives contracts, net | | $ | 3,983 | | | Futures contracts | | Other noncurrent assets | | 1,645 | | | Other noncurrent assets | | 403 | | | Basis derivative agreement | | Other current assets | | — | | | Other current liabilities | | 9,280 | | | Basis derivative agreement | | Other noncurrent assets | | — | | | Other noncurrent liabilities | | 2,994 | | | | Total | | $ | 2,740 | | | Total | | $ | 16,660 | |
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