XML 21 R11.htm IDEA: XBRL DOCUMENT

Note 4 - Discontinued Operations

6 Months Ended

Jun. 30, 2021

Notes to Financial Statements

Disposal Groups, Including Discontinued Operations, Disclosure [Text Block]

4.	DISCONTINUED OPERATIONS

On December 21, 2020, the Partnership announced that it entered into agreements to sell its crude oil trucking services, crude oil pipeline services, and crude oil terminalling services segments. These segments are reported as discontinued operations in the results of operations and financial position for all periods presented. The crude oil trucking services agreement closed in two phases, one on December 15, 2020, and one on February 2, 2021. The crude oil pipeline services agreement closed on February 1, 2021. Loss recognized on the classification of held for sale and disposal of these assets was recorded in the year ended December 31, 2020. The transaction related to the crude oil terminalling services segment closed on March 1, 2021. The Partnership has allocated interest to discontinued operations on debt that was required to be repaid as a result of the sales of the crude oil pipeline and terminalling services segment for the three and six months ended June 30, 2020 and 2021.

As part of the crude oil pipeline sale, $1.5 million of the gross sale proceeds are currently being held in escrow, subject to post-closing settlement terms and conditions. The Partnership expects to receive the majority of this in increments over the two years following the date of sale.

Exit and disposal costs related to these sales, in the form of employee severance payments, are expected to total approximately $1.6 million. The Partnership is providing limited transition services to both of the buyers of the crude oil pipeline and terminalling services segments. These services are expected to last approximately six months beyond the final closing date. The contracts were designed to recover the costs of providing services, so a minimal income statement impact is expected for these services.

During the three months ended March 31, 2020, an impairment of $4.9 million was recognized to write-down the value of the Partnership's crude oil linefill based on the market price of crude oil as of March 31, 2020. During the three months ended June 30, 2020, the Partnership recognized asset impairment expense of $1.3 million in its crude trucking services segment based on expected future cash flows and market interest compared to carrying value.

Assets and Liabilities of Discontinued Operations (in thousands)		*As of December 31, 2020*
		*Crude Oil Trucking Services*				*Crude Oil Pipeline Services*				*Crude Oil Terminalling Services*				*Total*
ASSETS
Accounts receivable, net		$	81			$	13,711			$	167			$	13,959
Plant, property, and equipment			442				23,541				52,854				76,837
Other assets			331				547				5,271				6,149
Total assets of discontinued operations		$	854			$	37,799			$	58,292			$	96,945

LIABILITIES
Current liabilities		$	1,017			$	14,921			$	1,310			$	17,248
Total liabilities of discontinued operations		$	1,017			$	14,921			$	1,310			$	17,248

Assets and Liabilities of Discontinued Operations (in thousands)		*As of June 30, 2021*
		*Crude Oil Trucking Services*				*Crude Oil Pipeline Services*				*Crude Oil Terminalling Services*				*Total*
ASSETS
Accounts receivable, net		$	-			$	38			$	778			$	816
Other assets			-				-				113				113
Total assets of discontinued operations		$	-			$	38			$	891			$	929

LIABILITIES
Current liabilities		$	13			$	232			$	607			$	852
Total liabilities of discontinued operations		$	13			$	232			$	607			$	852

Statement of Operations for Discontinued Operations (in thousands)			*Three Months Ended June 30, 2020*
		*Crude Oil Trucking Services*				*Crude Oil Pipeline Services*				*Crude Oil Terminalling Services*				*Total*
Revenue:
Third-party service revenue		$	1,522			$	372			$	5,093			$	6,987
Intercompany service revenue			1,505				-				-				1,505
Third-party product sales revenue			-				20,626				-				20,626
Costs and expenses:
Operating expense			3,452				3,481				2,181				9,114
Intercompany operating expense			-				1,505				-				1,505
Cost of product sales			-				7,079				-				7,079
Cost of product sales from related party			-				12,790				-				12,790
General and administrative expense			72				97				-				169
Tangible asset impairment expense			1,295				-				-				1,295
(Gain)loss on disposal of assets			(186	)			84				-				(102	)
Interest expense			3				231				1,052				1,286
Loss before income taxes			(1,609	)			(4,269	)			1,860				(4,018	)
Provision for income taxes			4				-				-				4
Net loss from discontinued operations		$	(1,613	)		$	(4,269	)		$	1,860			$	(4,022	)

Statement of Operations for Discontinued Operations (in thousands)		*Three Months Ended June 30, 2021*
		*Crude Oil Trucking Services*				*Crude Oil Pipeline Services*				*Crude Oil Terminalling Services*				*Total*
Revenue:
Third-party service revenue		$	-			$	122			$	798			$	920
Costs and expenses:
Operating expense			93				116				596				805
General and administrative expense			2				6				-				8
(Gain)loss on disposal of assets			-				50				(119	)			(69	)
Interest expense			-				-				1				1
Income(loss) before income taxes			(95	)			(50	)			320				175
Provision for income taxes			-				-				-				-
Net income(loss) from discontinued operations		$	(95	)		$	(50	)		$	320			$	175

Statement of Operations for Discontinued Operations (in thousands)		*Six Months Ended June 30, 2020*
		*Crude Oil Trucking Services*				*Crude Oil Pipeline Services*				*Crude Oil Terminalling Services*				*Total*
Revenue:
Third-party service revenue		$	4,064			$	874			$	8,422			$	13,360
Intercompany service revenue			2,930				-				-				2,930
Third-party product sales revenue			-				67,678				-				67,678
Costs and expenses:
Operating expense			7,474				6,784				4,203				18,461
Intercompany operating expense			-				2,930				-				2,930
Cost of product sales			-				21,300				-				21,300
Cost of product sales from related party			-				41,044				-				41,044
General and administrative expense			141				202				-				343
Tangible asset impairment expense			1,330				2,820				2,266				6,416
(Gain)loss on disposal of assets			(196	)			205				-				9
Interest expense			6				556				2,436				2,998
Loss before income taxes			(1,761	)			(7,289	)			(483	)			(9,533	)
Provision for income taxes			8				-				-				8
Net loss from discontinued operations		$	(1,769	)		$	(7,289	)		$	(483	)		$	(9,541	)

Statement of Operations for Discontinued Operations (in thousands)		*Six Months Ended June 30, 2021*
		*Crude Oil Trucking Services*				*Crude Oil Pipeline Services*				*Crude Oil Terminalling Services*				*Total*
Revenue:
Third-party service revenue		$	9			$	535			$	4,441			$	4,985
Intercompany service revenue			409				-				-				409
Third-party product sales revenue			-				15,591				-				15,591
Costs and expenses:
Operating expense			1,426				1,554				1,507				4,487
Intercompany operating expense			-				409				-				409
Cost of product sales			-				4,994				-				4,994
Cost of product sales from related party			-				9,461				-				9,461
General and administrative expense			61				123				-				184
Tangible asset impairment expense			92				41				23				156
Gain on disposal of assets			(3	)			(1,644	)			(73,491	)			(75,138	)
Interest expense			-				72				635				707
Income(loss) before income taxes			(1,158	)			1,116				75,767				75,725
Provision for income taxes			-				-				-				-
Net income(loss) from discontinued operations		$	(1,158	)		$	1,116			$	75,767			$	75,725

Select cash flow information (in thousands)
		*Crude Oil Trucking Services*				*Crude Oil Pipeline Services*				*Crude Oil Terminalling Services*				*Total*
		*Six Months Ended June 30, 2020*
Depreciation and amortization		$	405			$	2,318			$	2,268			$	4,991
Capital expenditures		$	180			$	1,210			$	337			$	1,727

		*Six Months Ended June 30, 2021*
Amortization		$	3			$	14			$	31			$	48
Capital expenditures		$	-			$	30			$	106			$	136