The Company has operating leases for corporate offices, drilling rigs, the Company’s liquids gathering system, and certain equipment. The leases have remaining lease terms of one year to nine years. The Company does not include renewal options in the lease term for calculating the lease liability unless it is reasonably certain that it will exercise the option or the lessor has the sole ability to exercise the option.

	For the Three Months Ended
	March 31, 2019
Operating lease cost	$	5,255
Variable lease cost (1)	$	1,694
Short-term lease cost (2)	$	9,910
Total lease cost (3)	$	16,859

(1)

Variable lease payments include additional payments made that were not included in the initial measurement of the ROU asset and corresponding lease liability for agreements with terms longer than 12 months. Variable lease payments relate to the actual volumes transported under certain agreements, and variable utility costs associated with the Company’s leased office space. Fluctuations in variable lease payments are driven by actual volumes under long-term agreements.

(2)

Costs associated with short-term lease agreements relate primarily to operational activities where underlying lease terms are less than one year. This amount is significant as it includes drilling activities, most of which are contracted for 12 months or less. It is expected this amount will fluctuate primarily with the number of drilling rigs the Company is operating under short-term agreements.

(3)

Lease costs are either expensed on the accompanying statements of operations or capitalized on the accompanying balance sheets depending on the nature and use of the underlying ROU asset.

The following table provides supplemental balance sheet information related to the Company’s operating leases:

	March 31, 2019
Operating Leases
Operating lease right-of-use assets	$	127,861

Operating lease liabilities	$	11,261
Long-term operating lease liabilities		116,613
Total operating lease liabilities	$	127,874

Weighted Average Remaining Lease Term
Operating leases	8.6 years
Weighted Average Discount Rate
Operating leases		7.91	%

The following table provides supplemental cash flow information related to the Company’s operating leases:

	For the Three Months Ended
	March 31, 2019
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	5,242

The following table summarizes the fixed, future minimum rental payments, excluding variable costs, which are discounted by the Company’s incremental borrowing rates to calculate the lease liabilities for the Company’s operating leases:

	Operating Leases
For the year ending December 31,
2019 (remaining)	$	15,646
2020		20,853
2021		20,750
2022		20,327
2023		19,719
Thereafter		78,239
Total lease payments	$	175,534
Less: imputed interest		(47,660	)
Total	$	127,874