Property, Plant, and Equipment

3 Months Ended

Mar. 31, 2020

Property, Plant and Equipment [Abstract]

8. PROPERTY, PLANT, AND EQUIPMENT

A summary of the historical cost of property, plant, and equipment is as follows:



thousands	Estimated Useful Life	March 31, 2020		December 31, 2019
Land	n/a	$	9,495	$	9,495
Gathering systems – pipelines	30 years	5,163,286		5,092,004
Gathering systems – compressors	15 years	2,006,896		1,929,377
Processing complexes and treating facilities	25 years	3,370,462		3,237,801
Transportation pipeline and equipment	6 to 45 years	171,111		173,572
Produced-water disposal systems	20 years	791,882		754,774
Assets under construction	n/a	337,000		486,584
Other	3 to 40 years	695,225		672,064
Total property, plant, and equipment		12,545,357		12,355,671
Less accumulated depreciation		3,558,626		3,290,740
Net property, plant, and equipment		$	8,986,731	$	9,064,931

The cost of property classified as “Assets under construction” is excluded from capitalized costs being depreciated. These amounts represent property that is not yet placed into productive service as of the respective balance sheet date.

Long-lived asset impairments. During the three months ended March 31, 2020, the Partnership recognized impairments of $155.8 million, primarily due to $145.1 million of impairments for assets located in Wyoming and Utah. These assets were impaired to estimated fair values of $91.0 million and estimated salvage value of $6.7 million. The Partnership assesses whether events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The fair value of assets with impairment triggers were measured using the income approach and Level-3 fair value inputs. The income approach was based on the Partnership’s projected future earnings before interest, taxes, depreciation, and amortization (“EBITDA”) and free cash flows, which requires significant assumptions including, among others, future throughput volumes based on current expectations of producer activity and operating costs. These impairments were triggered by reductions in estimated future cash flows resulting from lower forecasted producer throughput and lower commodity prices. The remaining impairments of $10.7 million were primarily at the DJ Basin complex due to cancellation of projects and impairments of rights-of-way.

During the year ended December 31, 2019, the Partnership recognized impairments of $6.3 million, primarily at the DJ Basin complex due to impairments of rights-of-way and cancellation of projects.

Potential future long-lived asset impairments. As of March 31, 2020, it is reasonably possible that prolonged low commodity prices, further commodity-price declines, and changes to producers’ drilling plans in response to lower prices could result in future long-lived asset impairments.