10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2021

OR

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                      to                     

Commission file number 001-36674 

USD PARTNERS LP

(Exact Name of Registrant as Specified in Its Charter)

Delaware	30-0831007
(State or Other Jurisdiction of Incorporation or Organization)	(I.R.S. Employer Identification No.)

811 Main Street, Suite 2800

Houston, Texas 77002

(Address of Principal Executive Offices) (Zip Code)

(Registrant’s Telephone Number, Including Area Code): (281) 291-0510

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol	Name of each exchange on which registered
Common Units Representing Limited Partner Interests	USDP	New York Stock Exchange

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  ☒    No  ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes  ☒    No  ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).   Yes  ☐    No  ☒

As of May 3, 2021, there were 27,224,441 common units and 461,136 general partner units outstanding.

TABLE OF CONTENTS

PART I — FINANCIAL INFORMATION
Item 1.	Financial Statements
	Consolidated Statements of Operations	1
	Consolidated Statements of Comprehensive Income (Loss)	2
	Consolidated Statements of Cash Flows	3
	Consolidated Balance Sheets	4
	Consolidated Statements of Partners’ Capital	5
	Notes to the Consolidated Financial Statements	6
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	28
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	45
Item 4.	Controls and Procedures	45
PART II — OTHER INFORMATION
Item 1.	Legal Proceedings	46
Item 1A.	Risk Factors	46
Item 6.	Exhibits	46
SIGNATURES		48

Unless the context otherwise requires, all references in this Quarterly Report on Form 10-Q, or this “Report,” to “USD Partners,” “USDP,” “the Partnership,” “we,” “us,” “our,” or like terms refer to USD Partners LP and its subsidiaries.

Unless the context otherwise requires, all references in this Report to (i) “our general partner” refer to USD Partners GP LLC, a Delaware limited liability company; (ii) “USD” refers to US Development Group, LLC, a Delaware limited liability company, and where the context requires, its subsidiaries; (iii) “USDG” and “our sponsor” refer to USD Group LLC, a Delaware limited liability company and currently the sole direct subsidiary of USD; (iv) “Energy Capital Partners” refers to Energy Capital Partners III, LP and its parallel and co-investment funds and related investment vehicles; and (v) “Goldman Sachs” refers to The Goldman Sachs Group, Inc. and its affiliates.

Cautionary Note Regarding Forward-Looking Statements

This Report includes forward-looking statements, which are statements that frequently use words such as “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “forecast,” “intend,” “may,” “plan,” “position,” “projection,” “should,” “strategy,” “target,” “will” and similar words. Although we believe that such forward-looking statements are reasonable based on currently available information, such statements involve risks, uncertainties and assumptions and are not guarantees of performance. Future actions, conditions or events and future results of operations may differ materially from those expressed in these forward-looking statements. Any forward-looking statement made by us in this Report speaks only as of the date on which it is made, and we undertake no obligation to publicly update any forward-looking statement. Many of the factors that will determine these results are beyond our ability to control or predict. Specific factors that could cause actual results to differ from those in the forward-looking statements include: (1) the impact of the novel coronavirus (COVID-19) pandemic and related economic downturn and governmental regulations; (2) changes in general economic conditions and commodity prices; (3) the effects of competition, in particular, by pipelines and other terminalling facilities; (4) shut-downs or cutbacks at upstream production facilities, refineries or other related businesses; (5) government regulations regarding oil production, including if the Alberta Government were to resume setting production limits; (6) the supply of, and demand for, terminalling services for crude oil and biofuels; (7) the price and availability of debt and equity financing; (8) actions by third parties, including customers, lenders, construction-related services providers, and our sponsors; (9) hazards and operating risks that may not be covered fully by insurance; (10) disruptions due to equipment interruption or failure at our facilities or third-party facilities on which our business is dependent; (11) natural disasters, weather-related delays, casualty losses and other matters beyond our control; (12) changes in laws or regulations to which we are subject, including compliance with environmental and operational safety regulations, that may increase our costs or limit our operations; and (13) our ability to successfully identify and finance potential acquisitions, development projects and other growth opportunities. For additional factors that may affect our results, see “Risk Factors” and the other information included elsewhere in this Report and our Annual Report on Form 10-K for the fiscal year ended December 31, 2020, which is available to the public over the Internet at the website of the U.S. Securities and Exchange Commission, or SEC, (www.sec.gov) and at our website (www.usdpartners.com).

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                PART I—FINANCIAL INFORMATION 

Item 1.     Financial Statements

USD PARTNERS LP

CONSOLIDATED STATEMENTS OF OPERATIONS

		Three Months Ended March 31,
		2021		2020
	(unaudited; in thousands of US dollars, except per unit amounts)
Revenues
Terminalling services		$	28,105	$	24,235
Terminalling services — related party		1,103		4,088
Fleet leases — related party		984		984
Fleet services		24		50
Fleet services — related party		227		227
Freight and other reimbursables		156		622
Total revenues		30,599		30,206
Operating costs
Subcontracted rail services		3,141		3,445
Pipeline fees		6,046		6,347
Freight and other reimbursables		156		622
Operating and maintenance		2,832		3,081
Operating and maintenance — related party		2,090		2,027
Selling, general and administrative		3,056		3,180
Selling, general and administrative — related party		1,677		1,993
Goodwill impairment loss		—		33,589
Depreciation and amortization		5,471		5,422
Total operating costs		24,469		59,706
Operating income (loss)		6,130		(29,500)
Interest expense		1,735		2,739
Loss (gain) associated with derivative instruments		(3,076)		2,873
Foreign currency transaction gain		(61)		(92)
Other income, net		(20)		(732)
Income (loss) before income taxes		7,552		(34,288)
Provision for (benefit from) income taxes		224		(507)
Net income (loss)		$	7,328	$	(33,781)
Net income (loss) attributable to limited partner interests		$	7,204	$	(33,210)
Net income (loss) per common unit (basic and diluted)		$	0.27	$	(1.30)
Weighted average common units outstanding		27,030		25,516
Net income (loss) per subordinated unit (basic and diluted)		$	—	$	(0.01)
Weighted average subordinated units outstanding		—		1,150

The accompanying notes are an integral part of these consolidated financial statements.

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USD PARTNERS LP

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

		Three Months Ended March 31,
		2021		2020
	(unaudited; in thousands of US dollars)
Net income (loss)		$	7,328	$	(33,781)
Other comprehensive income (loss) — foreign currency translation		375		(4,522)
Comprehensive income (loss)		$	7,703	$	(38,303)

The accompanying notes are an integral part of these consolidated financial statements.

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USD PARTNERS LP

CONSOLIDATED STATEMENTS OF CASH FLOWS

	Three Months Ended March 31,
	2021		2020
	(unaudited; in thousands of US dollars)
Cash flows from operating activities:
Net income (loss)	$	7,328	$	(33,781)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation and amortization	5,471		5,422
Loss (gain) associated with derivative instruments	(3,076)		2,873
Settlement of derivative contracts	(264)		(6)
Unit based compensation expense	1,512		1,635
Deferred income taxes	(18)		(352)
Amortization of deferred financing costs	207		207
Goodwill impairment loss	—		33,589
Changes in operating assets and liabilities:
Accounts receivable	(402)		608
Accounts receivable — related party	(84)		(941)
Prepaid expenses and other assets	884		(1,220)
Other assets — related party	(394)		(250)
Accounts payable and accrued expenses	290		407
Accounts payable and accrued expenses — related party	(25)		491
Deferred revenue and other liabilities	1,212		3,035
Other liabilities — related party	4		—
Net cash provided by operating activities	12,645		11,717
Cash flows from investing activities:
Additions of property and equipment	(483)		(147)
Net cash used in investing activities	(483)		(147)
Cash flows from financing activities:
Distributions	(3,183)		(10,655)
Vested phantom units used for payment of participant taxes	(857)		(1,788)
Proceeds from long-term debt	—		10,000
Repayments of long-term debt	(8,000)		(6,000)
Net cash used in financing activities	(12,040)		(8,443)
Effect of exchange rates on cash	(95)		(989)
Net change in cash, cash equivalents and restricted cash	27		2,138
Cash, cash equivalents and restricted cash — beginning of period	10,994		10,684
Cash, cash equivalents and restricted cash — end of period	$	11,021	$	12,822

The accompanying notes are an integral part of these consolidated financial statements.

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USD PARTNERS LP

CONSOLIDATED BALANCE SHEETS

	March 31, 2021		December 31, 2020
	(unaudited; in thousands of US dollars, except unit amounts)
ASSETS
Current assets
Cash and cash equivalents	$	3,066	$	3,040
Restricted cash	7,955		7,954
Accounts receivable, net	4,467		4,049
Accounts receivable — related party	2,569		2,460
Prepaid expenses	1,788		1,959
Other current assets	1,035		1,777
Other current assets — related party	—		15
Total current assets	20,880		21,254
Property and equipment, net	138,731		139,841
Intangible assets, net	58,341		61,492
Operating lease right-of-use assets	8,320		9,630
Other non-current assets	4,320		3,625
Other non-current assets — related party	2,138		1,706
Total assets	$	232,730	$	237,548
LIABILITIES AND PARTNERS’ CAPITAL
Current liabilities
Accounts payable and accrued expenses	$	2,303	$	1,865
Accounts payable and accrued expenses — related party	359		383
Deferred revenue	6,968		6,367
Deferred revenue — related party	410		410
Operating lease liabilities, current	5,153		5,291
Other current liabilities	4,407		4,222
Total current liabilities	19,600		18,538
Long-term debt, net	187,688		195,480
Operating lease liabilities, non-current	3,155		4,392
Other non-current liabilities	10,927		12,870
Other non-current liabilities — related party	4		—
Total liabilities	221,374		231,280
Commitments and contingencies
Partners’ capital
Common units (27,224,441 and 26,844,715 outstanding at March 31, 2021 and December 31, 2020, respectively)	8,472		3,829
General partner units (461,136 outstanding at March 31, 2021 and December 31, 2020)	1,962		1,892
Accumulated other comprehensive income	922		547
Total partners’ capital	11,356		6,268
Total liabilities and partners’ capital	$	232,730	$	237,548

The accompanying notes are an integral part of these consolidated financial statements.

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USD PARTNERS LP

THREE MONTHS CONSOLIDATED STATEMENTS OF PARTNERS’ CAPITAL

	Three Months Ended March 31,
	2021			2020
	Units	Amount		Units	Amount
	(unaudited; in thousands of US dollars, except unit amounts)
Common units
Beginning balance at January 1,	26,844,715	$	3,829	24,411,892	$	61,013
Conversion of units	—	—		2,092,709	(23,423)
Common units issued for vested phantom units	379,726	(857)		339,073	(1,788)
Net income (loss)	—	7,204		—	(33,195)
Unit based compensation expense	—	1,425		—	1,571
Distributions	—	(3,129)		—	(9,464)
Ending balance at March 31,	27,224,441	8,472		26,843,674	(5,286)
Subordinated units
Beginning balance at January 1,	—	—		2,092,709	(22,597)
Conversion of units	—	—		(2,092,709)	23,423
Net income (loss)	—	—		—	(15)
Distributions	—	—		—	(811)
Ending balance at March 31,	—	—		—	—
General Partner units
Beginning balance at January 1,	461,136	1,892		461,136	2,767
Net income (loss)	—	124		—	(571)
Unit based compensation expense	—	—		—	1
Distributions	—	(54)		—	(380)
Ending balance at March 31,	461,136	1,962		461,136	1,817
Accumulated other comprehensive income (loss)
Beginning balance at January 1,		547			(127)
Cumulative translation adjustment		375			(4,522)
Ending balance at March 31,		922			(4,649)
Total partners’ capital at March 31,		$	11,356		$	(8,118)

The accompanying notes are an integral part of these consolidated financial statements.

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USD PARTNERS LP

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(unaudited)

1. ORGANIZATION AND BASIS OF PRESENTATION

USD Partners LP and its consolidated subsidiaries, collectively referred to herein as we, us, our, the Partnership and USDP, is a fee-based, growth-oriented master limited partnership formed in 2014 by US Development Group, LLC, or USD, through its wholly-owned subsidiary, USD Group LLC, or USDG. We were formed to acquire, develop and operate midstream infrastructure and complementary logistics solutions for crude oil, biofuels and other energy-related products. We generate substantially all of our operating cash flows from multi-year, take-or-pay contracts with primarily investment grade customers, including major integrated oil companies, refiners and marketers. Our network of crude oil terminals facilitate the transportation of heavy crude oil from Western Canada to key demand centers across North America. Our operations include railcar loading and unloading, storage and blending in onsite tanks, inbound and outbound pipeline connectivity, truck transloading, as well as other related logistics services. We also provide our customers with leased railcars and fleet services to facilitate the transportation of liquid hydrocarbons by rail. We do not generally take ownership of the products that we handle, nor do we receive any payments from our customers based on the value of such products. We may on occasion enter into buy-sell arrangements in which we take temporary title to commodities while in our terminals. We expect such arrangements to be at fixed prices where we do not take commodity price exposure.

A substantial amount of the operating cash flows related to the terminalling services that we provide are generated from take-or-pay contracts with minimum monthly commitment fees and, as a result, are not directly related to actual throughput volumes at our crude oil terminals. Throughput volumes at our terminals are primarily influenced by the difference in price between Western Canadian Select, or WCS, and other grades of crude oil, commonly referred to as spreads, rather than absolute price levels. WCS spreads are influenced by several market factors, including the availability of supplies relative to the level of demand from refiners and other end users, the price and availability of alternative grades of crude oil, the availability of takeaway capacity, as well as transportation costs from supply areas to demand centers.

Basis of Presentation

Our accompanying unaudited interim consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States, or GAAP, for interim consolidated financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not include all the information and disclosures required by GAAP for complete consolidated financial statements. In the opinion of our management, they contain all adjustments, consisting only of normal recurring adjustments, which our management considers necessary to present fairly our financial position as of March 31, 2021, our results of operations for the three months ended March 31, 2021 and 2020, and our cash flows for the three months ended March 31, 2021 and 2020. We derived our consolidated balance sheet as of December 31, 2020 from the audited consolidated financial statements included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2020. Our results of operations for the three months ended March 31, 2021 and 2020 should not be taken as indicative of the results to be expected for the full year due to fluctuations in the supply of and demand for crude oil and biofuels, timing and completion of acquisitions, if any, changes in the fair market value of our derivative instruments and the impact of fluctuations in foreign currency exchange rates. These unaudited interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements and accompanying notes thereto presented in our Annual Report on Form 10-K for the fiscal year ended December 31, 2020.

COVID-19 Update

During 2020, the COVID-19 pandemic adversely affected the global economy, disrupted global supply chains and created significant volatility in the financial markets. As a result, there was significant reduction in demand for, and fluctuations in the prices of crude oil, natural gas and natural gas liquids. This significantly impacted Canadian producers, which in turn resulted in lower crude oil prices and led to lower throughput volume through our facilities.

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However, the decline in throughput volumes at our facilities did not have a material impact on our results of operations or cash flows during 2020, as a substantial amount of our terminalling services operating cash flows are generated from take-or-pay contracts with minimum monthly commitment fees with mainly investment grade customers. There still remains significant uncertainty given the unprecedented and evolving nature of the COVID-19 pandemic and the state of the commodity markets. As such, we will continue to actively monitor their impact on our operations and financial condition.

Foreign Currency Translation

We conduct a substantial portion of our operations in Canada, which we account for in the local currency, the Canadian dollar. We translate most Canadian dollar denominated balance sheet accounts into our reporting currency, the U.S. dollar, at the end of period exchange rate, while most accounts in our statement of operations accounts are translated into our reporting currency based on the average exchange rate for each monthly period. Fluctuations in the exchange rates between the Canadian dollar and the U.S. dollar can create variability in the amounts we translate and report in U.S. dollars.

Within these consolidated financial statements, we denote amounts denominated in Canadian dollars with “C$” immediately prior to the stated amount.

US Development Group, LLC

USD and its affiliates are engaged in designing, developing, owning and managing large-scale multi-modal logistics centers and energy-related infrastructure across North America. USD is the indirect owner of our general partner through its direct ownership of USDG and is currently owned by Energy Capital Partners, Goldman Sachs and certain of USD’s management team.

2. RECENT ACCOUNTING PRONOUNCEMENTS

Recently Adopted Accounting Pronouncements

Income Taxes (ASU 2019-12)

In December 2019, the Financial Accounting Standards Board, or FASB, issued Accounting Standards Update No. 2019-12, or ASU 2019-12, which amends the FASB Accounting Standards Codification, or ASC, Topic 740, by removing certain exceptions related to the approach for intraperiod tax allocation, the methodology for calculating income taxes in an interim period and the recognition of deferred tax liabilities for outside basis differences. It also simplifies aspects of the accounting for franchise taxes and enacted changes in tax laws or rates and clarifies the accounting for transactions that result in a step-up in the tax basis of goodwill. In addition, under the provisions of ASU 2019-12, single-member limited liability companies and similar disregarded entities that are not subject to income tax are not required to recognize an allocation of consolidated income tax expense in their separate financial statements, but they could elect to do so. The pronouncement is effective for fiscal years beginning after December 15, 2020, or for any interim periods within those fiscal years, with early adoption permitted.

We adopted the provisions of ASU 2019-12 on January 1, 2021. Our adoption of this standard did not have an impact on our financial statements.

3. NET INCOME (LOSS) PER LIMITED PARTNER INTEREST

We allocate our net income or loss among our general partner and limited partners using the two-class method in accordance with applicable authoritative accounting guidance. Under the two-class method, we allocate our net income or loss and any net income or loss in excess of distributions to our limited partners, our general partner and the holder of the incentive distribution rights, or IDRs, according to the distribution formula for available cash as set forth in our partnership agreement. We allocate any distributions in excess of earnings for the period to our limited partners and general partner based on their respective proportionate ownership interests in us, as set forth in our partnership agreement after taking into account distributions to be paid with respect to the IDRs. The formula for distributing available cash as set forth in our partnership agreement is as follows:

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Distribution Targets	Portion of Quarterly Distribution Per Unit	Percentage Distributed to Limited Partners	Percentage Distributed to General Partner (including IDRs) (1)
Minimum Quarterly Distribution	Up to $0.2875	98%	2%
First Target Distribution	> $0.2875 to $0.330625	98%	2%
Second Target Distribution	> $0.330625 to $0.359375	85%	15%
Third Target Distribution	> $0.359375 to $0.431250	75%	25%
Thereafter	Amounts above $0.431250	50%	50%

(1)Calculated as if our general partner holds the original 2% general partner interest in us, which is currently 1.7%.

We determined basic and diluted net income (loss) per limited partner unit as set forth in the following tables:

	For the Three Months Ended March 31, 2021
	Common Units		Subordinated Units (7)		General Partner Units		Total
	(in thousands, except per unit amounts)
Net income attributable to general and limited partner interests in USD Partners LP (1)	$	7,204	$	—	$	124	$	7,328
Less: Distributable earnings (2)	3,248		—		55		3,303
Excess net income	$	3,956	$	—	$	69	$	4,025
Weighted average units outstanding (3)	27,030		—		461		27,491
Distributable earnings per unit (4)	$	0.12	$	—
Underdistributed earnings per unit (5)	0.15		—
Net income per limited partner unit (basic and diluted) (6)	$	0.27	$	—

(1)Represents net income allocated to each class of units based on the actual ownership of the Partnership during the period. There were no amounts attributed to the general partner for its incentive distribution rights.

(2)Represents the per unit distribution payable for the period based upon the quarterly distribution amounts of $0.1135 per unit or $0.454 on an annualized basis. Amounts presented for each class of units include a proportionate amount of the $161 thousand distributable to holders of the Equity classified Phantom Units pursuant to the distribution equivalent rights granted under the USD Partners LP 2014 Amended and Restated Long-Term Incentive Plan.

(3)Represents the weighted average units outstanding for the period.

(4)Represents the total distributable earnings divided by the weighted average number of units outstanding for the period.

(5)Represents the additional amount per unit necessary to distribute the excess net income for the period among our limited partners and our general partners according to the distribution formula for available cash as set forth in our partnership agreement.

(6)Our computation of net income per limited partner unit excludes the effects of 1,418,517 equity-classified phantom unit awards outstanding as they were anti-dilutive for the period presented.

(7)In February 2020, the final tranche of 2,092,709 subordinated units were converted into common units and therefore there were no subordinated units outstanding during 2021. Refer to Note 16. Partners Capital for more information.

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	For the Three Months Ended March 31, 2020
	Common Units		Subordinated Units (7)		General Partner Units		Total
	(in thousands, except per unit amounts)
Net loss attributable to general and limited partner interests in USD Partners LP (1)	$	(33,195)	$	(15)	$	(571)	$	(33,781)
Less: Distributable earnings (2)	3,129		—		54		3,183
Distributions in excess of earnings	$	(36,324)	$	(15)	$	(625)	$	(36,964)
Weighted average units outstanding (3)	25,516		1,150		461		27,127
Distributable earnings per unit (4)	$	0.12	$	—
Overdistributed earnings per unit (5)	(1.42)		(0.01)
Net loss per limited partner unit (basic and diluted)(6)	$	(1.30)	$	(0.01)

(1)Represents net loss allocated to each class of units based on the actual ownership of the Partnership during the period. There were no amounts attributed to the general partner for its incentive distribution rights.

(2)Represents the per unit distributions paid for the period based upon the quarterly distribution of $0.111 per unit, or $0.444 per unit on an annualized basis. Amounts presented for each class of units include a proportionate amount of the $152 thousand distributed to holders of the Equity-classified Phantom Units pursuant to the distribution equivalent rights granted under the USD Partners LP 2014 Amended and Restated Long-Term Incentive Plan.

(3)Represents the weighted average units outstanding for the period.

(4)Represents the total distributable earnings divided by the weighted average number of units outstanding for the period.

(5)Represents the distributions in excess of earnings divided by the weighted average number of units outstanding for the period.

(6)Our computation of net loss per limited partner unit excludes the effects of 1,367,678 equity-classified phantom unit awards outstanding as they were anti-dilutive for the period presented.

(7)In February 2020, the final tranche of 2,092,709 subordinated units were converted into common units. Refer to Note 16. Partners Capital for more information.

4. REVENUES

Disaggregated Revenues

We manage our business in two reportable segments: Terminalling services and Fleet services. Our segments offer different services and are managed accordingly. Our chief operating decision maker, or CODM, regularly reviews financial information about both segments in order to allocate resources and evaluate performance. As such, we have concluded that disaggregating revenue by reporting segments appropriately depicts how the nature, amount, timing, and uncertainty of revenue and cash flows are affected by economic factors. Refer to Note 14. Segment Reporting for our disaggregated revenues by segment. Additionally, the below tables summarize the geographic data for our revenues:

	Three Months Ended March 31, 2021
	U.S.		Canada		Total
	(in thousands)
Third party	$	7,638	$	20,647	$	28,285
Related party	$	2,314	$	—	$	2,314

	Three Months Ended March 31, 2020
	U.S.		Canada		Total
	(in thousands)
Third party	$	7,049	$	17,858	$	24,907
Related party	$	2,305	$	2,994	$	5,299

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Remaining Performance Obligations

The transaction price allocated to the remaining performance obligations associated with our terminalling and fleet services agreements as of March 31, 2021 are as follows for the periods indicated:

	For the nine months ending December 31, 2021		2022		2023		2024		Thereafter		Total
	(in thousands)
Terminalling Services (1) (2) (3)	$	73,729	$	75,048	$	37,779	$	19,528	$	126,932	$	333,016
Fleet Services	682		1,195		—		—		—		1,877
Total	$	74,411	$	76,243	$	37,779	$	19,528	$	126,932	$	334,893

(1)A significant portion of our terminalling services agreements are denominated in Canadian dollars. We have converted the remaining performance obligations associated with these Canadian dollar-denominated contracts using the year-to-date average exchange rate of 0.7897 U.S. dollars for each Canadian dollar at March 31, 2021.

(2)Includes fixed monthly minimum commitment fees per contracts and excludes constrained estimates of variable consideration for rate-escalations associated with an index, such as the consumer price index, as well as any incremental revenue associated with volume activity above the minimum volumes set forth within the contracts. Also excludes estimated constrained variable consideration included in certain of our terminalling services agreements that is based on crude oil pricing index differentials.

(3)Assumes USD’s Diluent Recovery Unit project goes into service in the second half of 2021, which will result in certain terminalling services agreements of our Hardisty Terminal being automatically extended through mid-2031 and certain agreements at our Stroud Terminal having a termination right in June 2022.

We have applied the practical expedient that allows us to exclude disclosure of performance obligations that are part of a contract that has an expected duration of one year or less.

Contract Assets

Our contract assets represent cumulative revenue that has been recognized in advance of billing the customer due to tiered billing provisions. In such arrangements, revenue is recognized using a blended rate based on the billing tiers of the agreement, as the services are consistently provided throughout the duration of the contractual arrangement.

We had the following amounts outstanding associated with our contract assets on our consolidated balance sheets in the financial statement line items presented below in the following table for the indicated periods:

	March 31, 2021		December 31, 2020
	(in thousands)
Other current assets	$	897	$	1,622

Deferred Revenue

Our deferred revenue is a form of a contract liability and consists of amounts collected in advance from customers associated with their terminalling and fleet services agreements and deferred revenues associated with make-up rights, which will be recognized as revenue when earned pursuant to the terms of our contractual arrangements. We currently recognize substantially all of the amounts we receive for minimum volume commitments as revenue when collected, since breakage associated with these make-up rights is currently approximately 97% based on our expectations around usage of these options. Accordingly, we had $0.6 million deferred revenues at March 31, 2021 for estimated breakage associated with the make-up rights options we granted to our customers. There were no deferred revenues associated with make-up rights at December 31, 2020.

We also have deferred revenue that represents cumulative revenue that has been deferred due to tiered billing provisions. In such arrangements, revenue is recognized using a blended rate based on the billing tiers of the agreement, as the services are consistently provided throughout the duration of the contractual arrangement, which we included in “Other current liabilities” and “Other non-current liabilities” on our consolidated balance sheets.

The following table presents the amounts outstanding on our consolidated balance sheets and changes

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associated with the balance of our deferred revenue for the three months ended March 31, 2021:

	December 31, 2020		Cash Additions for Customer Prepayments		Revenue Recognized		March 31, 2021
	(in thousands)
Deferred revenue (1)	$	6,367	$	6,968	$	(6,367)	$	6,968
Other current liabilities	$	—	$	704	$	—	$	704
Other non-current liabilities (2)	$	10,087	$	781	$	—	$	10,868

(1)    Includes deferred revenue of $0.6 million for estimated breakage associated with the make-up rights options we granted to our customers, as discussed above.

(2)    Includes cumulative revenue that has been deferred due to tiered billing provisions included in certain of our Canadian dollar-denominated contracts, as discussed above. As such, the change in “Other non-current liabilities” presented has been increased by $121 thousand due to the impact of the change in the end of period exchange rate between December 31, 2020 and March 31, 2021.

Deferred Revenue — Fleet Leases

Our deferred revenue also includes advance payments from customers of our Fleet services business, which will be recognized as Fleet leases revenue when earned pursuant to the terms of our contractual arrangements. We have included $0.4 million at March 31, 2021 and December 31, 2020, in “Deferred revenue — related party” on our consolidated balance sheets associated with customer prepayments for our fleet lease agreements. Refer to Note 7. Leases for additional discussion of our lease revenues.

5. RESTRICTED CASH

We include in restricted cash amounts representing a cash account for which the use of funds is restricted by a facilities connection agreement among us and Gibson Energy Inc., or Gibson, that we entered into during 2014 in connection with the development of our Hardisty terminal. The collaborative arrangement is further discussed in Note 10. Collaborative Arrangement.

The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within our consolidated balance sheets to the amounts shown in our consolidated statements of cash flows for the specified periods:

	March 31,
	2021		2020
	(in thousands)
Cash and cash equivalents	$	3,066	$	4,622
Restricted Cash	7,955		8,200
Total cash, cash equivalents and restricted cash	$	11,021	$	12,822

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6. PROPERTY AND EQUIPMENT

Our property and equipment is comprised of the following asset classifications as of the dates indicated:

	March 31, 2021		December 31, 2020		Estimated Depreciable Lives (Years)
	(in thousands)
Land	$	10,324	$	10,288	N/A
Trackage and facilities	128,189		127,401		10-30
Pipeline	32,735		32,735		20-30
Equipment	17,409		17,337		3-20
Furniture	67		67		5-10
Total property and equipment	188,724		187,828
Accumulated depreciation	(51,249)		(48,630)
Construction in progress (1)	1,256		643
Property and equipment, net	$	138,731	$	139,841

(1) The amounts classified as “Construction in progress” are excluded from amounts being depreciated. These amounts represent property that has not been placed into productive service as of the respective consolidated balance sheet date.

Depreciation expense associated with property and equipment totaled $2.3 million for the three months ended March 31, 2021 and 2020.

7. LEASES

We have noncancellable operating leases for railcars, buildings, storage tanks, offices, railroad tracks, and land.

	Three Months Ended March 31, 2021
Weighted-average discount rate	5.8	%
Weighted average remaining lease term in years	1.65

Our total lease cost consisted of the following items for the dates indicated:

		Three Months Ended March 31,
		2021		2020
	(in thousands)
Operating lease cost		$	1,479	$	1,486
Short term lease cost		44		45
Variable lease cost		18		9
Sublease income		(1,348)		(1,341)
Total		$	193	$	199

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The maturity analysis below presents the undiscounted cash payments we expect to make each period for property that we lease from others under noncancellable operating leases as of March 31, 2021 (in thousands): 

2021	$	4,179
2022	4,520
2023	35
2024	2
Total lease payments	$	8,736
Less: imputed interest	(428)
Present value of lease liabilities	$	8,308

We serve as an intermediary to assist our customers with obtaining railcars. In connection with our leasing of railcars from third parties, we simultaneously enter into lease agreements with our customers for noncancellable terms that are designed to recover our costs associated with leasing the railcars plus a fee for providing this service. In addition to these leases, we also have lease income from storage tanks.

	Three Months Ended March 31,
	2021		2020
	(in thousands, except weighted average term)
Lease income (1)	$	2,185	$	2,186
Weighted average remaining lease term in years			1.58

(1)Lease income presented above includes lease income from related parties. Refer to Note 12. Transactions with Related Parties for additional discussion of lease income from related parties. Lease income associated with crude oil storage tanks we lease to customers of our terminals totaling $1.2 million for the three months ended March 31, 2021 and 2020, is included in “Terminalling services” revenues on our consolidated statements of operations.

The maturity analysis below presents the undiscounted future minimum lease payments we expect to receive from customers each period for property they lease from us under noncancellable operating leases as of March 31, 2021 (in thousands): 

2021	$	6,142
2022	5,367
Total	$	11,509

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8. INTANGIBLE ASSETS

The composition, gross carrying amount and accumulated amortization of our identifiable intangible assets are as follows as of the dates indicated:

	March 31, 2021		December 31, 2020
	(in thousands)
Carrying amount:
Customer service agreements	$	125,960	$	125,960
Other	106		106
Total carrying amount	126,066		126,066
Accumulated amortization:
Customer service agreements	(67,669)		(64,520)
Other	(56)		(54)
Total accumulated amortization	(67,725)		(64,574)
Total intangible assets, net	$	58,341	$	61,492

Amortization expense associated with intangible assets totaled $3.2 million for the three months ended March 31, 2021 and 2020.

9. DEBT

In November 2018, we amended and restated our senior secured credit agreement, which we originally established at the time of our initial public offering in October 2014. We refer to the amended and restated senior secured credit agreement executed in November 2018 as the Credit Agreement and the original senior secured credit agreement as the Previous Credit Agreement. Our Credit Agreement is a $385 million revolving credit facility (subject to limits set forth therein) with Citibank, N.A., as administrative agent, and a syndicate of lenders. Our Credit Agreement amends and restates in its entirety our Previous Credit Agreement.

Our Credit Agreement is a four year committed facility that initially matures on November 2, 2022. Our Credit Agreement provides us with the ability to request two one-year maturity date extensions, subject to the satisfaction of certain conditions, and allows us the option to increase the maximum amount of credit available up to a total facility size of $500 million, subject to receiving increased commitments from lenders and satisfaction of certain conditions.

Our Credit Agreement and any issuances of letters of credit are available for working capital, capital expenditures, general partnership purposes and continue the indebtedness outstanding under the Previous Credit Agreement. The Credit Agreement includes an aggregate $20 million sublimit for standby letters of credit and a $20 million sublimit for swingline loans. Obligations under the Credit Agreement are guaranteed by our restricted subsidiaries (as such term is defined therein) and are secured by a first priority lien on our assets and those of our restricted subsidiaries, other than certain excluded assets.

Our long-term debt balances included the following components as of the specified dates:

	March 31, 2021		December 31, 2020
	(in thousands)
Revolving Credit Facility	$	189,000	$	197,000
Less: Deferred financing costs, net	(1,312)		(1,520)
Total long-term debt, net	$	187,688	$	195,480

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We determined the capacity available to us under the terms of our Credit Agreement was as follows as of the specified dates:

	March 31, 2021		December 31, 2020
	(in millions)
Aggregate borrowing capacity under Credit Agreement	$	385.0	$	385.0
Less: Revolving Credit Facility amounts outstanding	189.0		197.0
Available under the Credit Agreement based on capacity	$	196.0	$	188.0
Available under the Credit Agreement based on covenants (1)	$	71.4	$	53.2

(1)    Pursuant to the terms of our Credit Agreement, our borrowing capacity, currently, is limited to 4.5 times our trailing 12-month consolidated EBITDA, which equates to $71.4 million and $53.2 million of borrowing capacity available at March 31, 2021 and December 31, 2020, respectively.

The weighted average interest rate on our outstanding indebtedness was 2.62% and 2.66% at March 31, 2021 and December 31, 2020, respectively, without consideration to the effect of our derivative contracts. In addition to the interest we incur on our outstanding indebtedness, we pay commitment fees of 0.50% on unused commitments, which rate will vary based on our consolidated net leverage ratio, as defined in our Credit Agreement. At March 31, 2021, we were in compliance with the covenants set forth in our Credit Agreement.

Interest expense associated with our outstanding indebtedness was as follows for the specified periods:

		Three Months Ended March 31,
		2021		2020
	(in thousands)
Interest expense on the Credit Agreement		$	1,528	$	2,532
Amortization of deferred financing costs		207		207
Total interest expense		$	1,735	$	2,739

10. COLLABORATIVE ARRANGEMENT

We entered into a facilities connection agreement in 2014 with Gibson under which Gibson developed, constructed and operates a pipeline and related facilities connected to our Hardisty terminal. Gibson’s storage terminal is the exclusive means by which our Hardisty Terminal receives crude oil. Subject to certain limited exceptions regarding manifest train facilities, our Hardisty Terminal is the exclusive means by which crude oil from Gibson’s Hardisty storage terminal may be transported by rail. We remit pipeline fees to Gibson for the transportation of crude oil to our Hardisty Terminal based on a predetermined formula. Pursuant to our arrangement with Gibson, we incurred pipeline fees of $6.0 million and $6.3 million for the three months ended March 31, 2021 and 2020, respectively, which are presented as “Pipeline fees” in our consolidated statements of operations. We have included a liability related to this agreement in “Other current liabilities” on our consolidated balance sheets of $1.7 million and $2.3 million at March 31, 2021 and December 31, 2020, respectively. Additionally, we have included an asset related to this agreement in “Other non-current assets” of $3.0 million and $2.9 million at March 31, 2021 and December 31, 2020, respectively, which we will recognize as expense concurrently with the recognition of the associated revenue at out Hardisty Terminal.

11. NONCONSOLIDATED VARIABLE INTEREST ENTITIES

Historically we entered into purchase, assignment and assumption agreements to assign payment and performance obligations for certain operating lease agreements with lessors, as well as customer fleet service payments related to these operating leases, with unconsolidated entities in which we had variable interests. These variable interest entities, or VIEs, included LRT Logistics Funding LLC, USD Fleet Funding LLC, USD Fleet Funding Canada Inc., and USD Logistics Funding Canada Inc. We treated those entities as variable interests under the applicable accounting guidance due to their having an insufficient amount of equity invested at risk to finance

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their activities without additional subordinated financial support. We were not the primary beneficiary of the VIEs, as we did not have the power to direct the activities that most significantly affected the economic performance of the VIEs, nor did we have the power to remove the managing member under the terms of the VIEs’ limited liability company agreements. Accordingly, we did not consolidate the results of the VIEs in our consolidated financial statements.

As of the end of February 2021, the remaining railcar leases associated with these VIEs were either assigned directly to our customers or have expired. As such, we have terminated our relationship with these VIEs discussed herein effective as of the end of February 2021.

The following table summarizes the total assets and liabilities between us and the VIEs as reflected in our consolidated balance sheet at December 31, 2020, as well as our maximum exposure to losses from entities in which we had a variable interest, but were not the primary beneficiary. Generally, our maximum exposure to losses was limited to amounts receivable for services we provided, reduced by any related liabilities.

	December 31, 2020
	Total assets		Total liabilities		Maximum exposure to loss
	(in thousands)
Accounts receivable	$	43	$	—	$	33
Deferred revenue	—		10		—
	$	43	$	10	$	33

12. TRANSACTIONS WITH RELATED PARTIES

Nature of Relationship with Related Parties

USD is engaged in designing, developing, owning and managing large-scale multi-modal logistics centers and other energy-related infrastructure across North America. USD is also the sole owner of USDG and the ultimate parent of our general partner. USD is owned by Energy Capital Partners, Goldman Sachs and certain members of its management.

USDG is the sole owner of our general partner and at March 31, 2021, owns 11,557,090 of our common units representing a 41.7% limited partner interest in us. As of March 31, 2021, a value of up to $10.0 million of these common units were pledged as collateral under USDG’s letter of credit facility. USDG also provides us with general and administrative support services necessary for the operation and management of our business.

USD Partners GP LLC, our general partner, currently owns all 461,136 of our general partner units representing a 1.7% general partner interest in us, as well as all of our incentive distribution rights. Pursuant to our partnership agreement, our general partner is responsible for our overall governance and operations. However, our general partner has no obligation to, does not intend to and has not implied that it would, provide financial support to or fund cash flow deficits of the Partnership.

USD Marketing LLC, or USDM, is a wholly-owned subsidiary of USDG organized to promote contracting for services provided by our terminals and to facilitate the marketing of customer products.

USD Terminals Canada II ULC, or USDTC II, is an indirect, wholly-owned Canadian subsidiary of USDG, organized for the purposes of pursuing expansion and other development opportunities associated with our Hardisty Terminal, pursuant to the Development Rights and Cooperation agreement between our wholly-owned subsidiary USD Terminals Canada ULC, or USDTC, and USDG. USDTC owns the legacy crude oil loading facility we refer to as the Hardisty Terminal. USDTC II completed construction of the Hardisty South expansion (“Hardisty South”) which commenced operations in January 2019. Hardisty South, which is owned and operated by USDTC II, added one and one-half 120-railcar unit trains of transloading capacity per day, or approximately 112,500 barrels per day,

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of takeaway capacity to the terminal by modifying the existing loading rack and building additional infrastructure and trackage.

Omnibus Agreement

We are party to an omnibus agreement with USD, USDG and certain of their subsidiaries, or Omnibus Agreement, including our general partner, pursuant to which we obtain and make payments for specified services provided to us and for out-of-pocket costs incurred on our behalf. We pay USDG, in equal monthly installments, the annual amount USDG estimates will be payable by us during the calendar year for providing services for our benefit. The Omnibus Agreement provides that this amount may be adjusted annually to reflect, among other things, changes in the scope of the general and administrative services provided to us due to a contribution, acquisition or disposition of assets by us or our subsidiaries, or for changes in any law, rule or regulation applicable to us, which affects the cost of providing the general and administrative services. We also reimburse USDG for any out-of-pocket costs and expenses incurred on our behalf in providing general and administrative services to us. This reimbursement is in addition to the amounts we pay to reimburse our general partner and its affiliates for certain costs and expenses incurred on our behalf for managing our business and operations, as required by our partnership agreement.

The total amounts charged to us under the Omnibus Agreement for the three months ended March 31, 2021 and 2020 was $1.7 million and $2.0 million, respectively, which amounts are included in “Selling, general and administrative — related party” in our consolidated statements of operations. We had a payable balance of $0.3 million with respect to these costs at March 31, 2021 and December 31, 2020, included in “Accounts payable and accrued expenses — related party” in our consolidated balance sheets.

Marketing Services Agreement

In connection with our purchase of the Stroud terminal, we entered into a Marketing Services Agreement with USDM, in May 2017, whereby we granted USDM the right to market the capacity at the Stroud Terminal in excess of the original capacity of our initial customer in exchange for a nominal per barrel fee. USDM is obligated to fund any related capital costs associated with increasing the throughput or efficiency of the terminal to handle additional throughput. Upon expiration of our contract with the initial Stroud customer in June 2020, the same marketing rights now apply to all throughput at the Stroud Terminal in excess of the throughput necessary for the Stroud Terminal to generate Adjusted EBITDA that is at least equal to the average monthly Adjusted EBITDA derived from the initial Stroud customer during the 12 months prior to expiration. We also granted USDG the right to develop other projects at the Stroud Terminal in exchange for the payment to us of market-based compensation for the use of our property for such development projects. Any such development projects would be wholly-owned by USDG and would be subject to our existing right of first offer with respect to midstream projects developed by USDG. Payments made under the Marketing Services Agreement during the periods presented in this Report are discussed below under the heading “Related Party Revenue and Deferred Revenue.” 

Hardisty Terminal Services Agreement

We entered into a terminal services agreement with USDTC II in 2019, whereby Hardisty South will provide terminalling services for a third-party customer of our Hardisty Terminal for contracted capacity that exceeds the transloading capacity currently available. We incurred $2.1 million and $2.0 million of expenses pursuant to the arrangement for the three months ended March 31, 2021 and 2020, respectively, which amounts are included in “Operating and maintenance expense — related party” in our consolidated statements of operations. These costs represent the same rate, on a per barrel basis, that we received as revenue from our third-party customer, which is included in “Terminalling Services” revenue in our consolidated statements of operations. Additionally, in conjunction with the agreement, we recorded a contract asset of $2.1 million and $1.7 million at March 31, 2021 and December 31, 2020, respectively, on our consolidated balance sheet in “Other non-current assets — related party”, representing long-term prepaid expense associated with this agreement due to tiered billing provisions in the related terminalling services agreements.

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Hardisty Shared Facilities Agreement

USDTC facilitates the provision of services on behalf of USDTC II pursuant to the terms of a shared facilities agreement, which includes all subcontracted railcar loading, operating, maintenance, pipeline and management services for the entire Hardisty terminal, including Hardisty South owned by USDTC II. USDTC passes through a proportionate amount of the cost of such services to USDTC II. Our financial statements only reflect the cost incurred by USDTC.

Related Party Revenue and Deferred Revenue

We have agreements to provide terminalling and fleet services for USDM with respect to our Hardisty Terminal and terminalling services with respect to our Stroud terminal, which also include reimbursement to us for certain out-of-pocket expenses we incur.

USDM assumed the rights and obligations for terminalling capacity at our Hardisty Terminal from another customer in June 2017 to facilitate the origination of crude oil barrels by the Stroud customer from our Hardisty Terminal for delivery to the Stroud terminal. As a result of USDM assuming these rights and obligations and in order to accommodate the needs of the Stroud customer, the contracted term for the capacity held by USDM at our Hardisty Terminal was extended from June 30, 2019 to June 30, 2020. The terms and conditions of these agreements were similar to the terms and conditions of agreements we have with other parties at the Hardisty Terminal that are not related to us. USDM’s agreement with the third party customer was renewed and extended, effective July 1, 2020, and USDM subsequently assigned its terminalling services agreement with the third party customer directly to us and is therefore no longer a customer at our Hardisty terminal. USDM controlled approximately 25% of the available monthly capacity of the Hardisty Terminal through June 30, 2020.

In connection with our purchase of the Stroud terminal, we also entered into a Marketing Services Agreement with USDM, as discussed above. Pursuant to the terms of the agreement, we receive a fixed amount per barrel from USDM in exchange for marketing the additional capacity available at the Stroud terminal. We also received revenue for providing additional terminalling services at our Hardisty Terminal to USDM pursuant to the terms of its agreement with us. Additionally, effective January 2019, we entered into a six month terminalling services agreement with USDM at our Casper Terminal to maximize utilization of available terminalling and storage capacity by offering these services to customers on an uncommitted basis at current market rates. This agreement automatically renews for successive periods of six months on an evergreen basis unless otherwise canceled by either party. We include amounts received pursuant to these arrangements as revenue in the table below under “Terminalling services — related party” in our consolidated statements of operations. Additionally, we received revenue from USDM for the lease of 200 railcars pursuant to the terms of an existing agreement with us, which is included in the table below under “Fleet leases — related party” and “Fleet services — related party” and in our consolidated statements of operations.

Our related party revenues from USD and affiliates are presented below in the following table for the indicated periods:

		Three Months Ended March 31,
		2021		2020
	(in thousands)
Terminalling services — related party		$	1,103	$	4,088
Fleet leases — related party		984		984
Fleet services — related party		227		227
		$	2,314	$	5,299

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We had the following amounts outstanding with USD and affiliates on our consolidated balance sheets as presented below in the following table for the indicated periods:

	March 31, 2021		December 31, 2020
	(in thousands)
Accounts receivable — related party	$	2,569	$	2,460
Accounts payable and accrued expenses — related party (1)	$	65	$	64
Other current and non-current assets — related party (2)	$	2,138	$	1,721
Other non-current liabilities related party (3)	$	4	$	—
Deferred revenue — related party (4)	$	410	$	410

(1)Does not include amounts payable to related parties associated with the Omnibus Agreement, as discussed above.

(2)Includes a contract asset associated with the Hardisty Terminal Services Agreement with USDTC II, as discussed above. Also includes a contract asset associated with a lease agreement with USDM. Refer to Note 4. Revenues for further discussion.

(3)Represents a contract liability associated with a lease agreement with USDM and cumulative revenue that has been deferred due to tiered billing provisions. Refer to Note 4. Revenues for further discussion.

(4)Represents deferred revenues associated with our fleet services agreements with USD and affiliates for amounts we have collected from them for their prepaid leases.

Cash Distributions

We paid the following aggregate cash distributions to USDG as a holder of our common units and to USD Partners GP LLC as sole holder of our general partner interest and IDRs.

Distribution Declaration Date	Record Date	Distribution Payment Date	Amount Paid to  USDG		Amount Paid to USD Partners GP LLC
			(in thousands)
January 28, 2021	February 10, 2021	February 19, 2021	$	1,283	$	51

13. COMMITMENTS AND CONTINGENCIES

From time to time, we may be involved in legal, tax, regulatory and other proceedings in the ordinary course of business. We do not believe that we are currently a party to any such proceedings that will have a material adverse impact on our financial condition or results of operations.

14. SEGMENT REPORTING

We manage our business in two reportable segments: Terminalling services and Fleet services. The Terminalling services segment charges minimum monthly commitment fees under multi-year take-or-pay contracts to load and unload various grades of crude oil into and from railcars, as well as fixed fees per gallon to transload ethanol from railcars, including related logistics services. We also facilitate rail-to-pipeline shipments of crude oil. Our Terminalling services segment also charges minimum monthly fees to store crude oil in tanks that are leased to our customers. The Fleet services segment provides customers with railcars and fleet services related to the transportation of liquid hydrocarbons and biofuels under multi-year, take-or-pay contracts. Corporate activities are not considered a reportable segment, but are included to present shared services and financing activities which are not allocated to our established reporting segments.

Our segments offer different services and are managed accordingly. Our chief operating decision maker, or CODM, regularly reviews financial information about both segments in order to allocate resources and evaluate performance. Our CODM assesses segment performance based on the cash flows produced by our established reporting segments using Segment Adjusted EBITDA. Segment Adjusted EBITDA is a measure calculated in accordance with GAAP. We define Segment Adjusted EBITDA as “Net income (loss)” of each segment adjusted for depreciation and amortization, interest, income taxes, changes in contract assets and liabilities, deferred revenues, foreign currency transaction gains and losses and other items which do not affect the underlying cash flows

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produced by our businesses. As such, we have concluded that disaggregating revenue by reporting segments appropriately depicts how the nature, amount, timing, and uncertainty of revenue and cash flows are affected by economic factors.

Segment Allocation of Certain Selling, General and Administrative Costs

Historically, we have allocated certain selling, general and administrative expenses to our Terminalling services and Fleet services segments that included corporate function personnel costs for managing our business that are allocated to us by our general partner, as well as other administrative expenses including audit fees and certain consulting fees. Beginning with the first quarter in 2021, these selling, general, and administrative expenses that are not directly related to operating our Terminalling services and Fleet services segments will now be allocated to corporate selling, general, and administrative expenses to better reflect the financial results of our Terminalling services and Fleet services segments.

	Three Months Ended March 31, 2021
	Terminalling services		Fleet services		Corporate		Total
	(in thousands)
Revenues
Terminalling services	$	28,105	$	—	$	—	$	28,105
Terminalling services — related party	1,103		—		—		1,103
Fleet leases — related party	—		984		—		984
Fleet services	—		24		—		24
Fleet services — related party	—		227		—		227
Freight and other reimbursables	124		32		—		156
Total revenues	29,332		1,267		—		30,599
Operating costs
Subcontracted rail services	3,141		—		—		3,141
Pipeline fees	6,046		—		—		6,046
Freight and other reimbursables	124		32		—		156
Operating and maintenance	3,924		998		—		4,922
Selling, general and administrative	1,019		92		3,622		4,733
Goodwill impairment loss	—		—		—		—
Depreciation and amortization	5,471		—		—		5,471
Total operating costs	19,725		1,122		3,622		24,469
Operating income (loss)	9,607		145		(3,622)		6,130
Interest expense	—		—		1,735		1,735
Gain associated with derivative instruments	—		—		(3,076)		(3,076)
Foreign currency transaction loss (gain)	133		—		(194)		(61)
Other income, net	(20)		—		—		(20)
Provision from income taxes	197		27		—		224
Net income (loss)	$	9,297	$	118	$	(2,087)	$	7,328

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	Three Months Ended March 31, 2020
	Terminalling services		Fleet services		Corporate		Total
	(in thousands)
Revenues
Terminalling services	$	24,235	$	—	$	—	$	24,235
Terminalling services — related party	4,088		—		—		4,088
Fleet leases — related party	—		984		—		984
Fleet services	—		50		—		50
Fleet services — related party	—		227		—		227
Freight and other reimbursables	617		5		—		622
Total revenues	28,940		1,266		—		30,206
Operating costs
Subcontracted rail services	3,445		—		—		3,445
Pipeline fees	6,347		—		—		6,347
Freight and other reimbursables	617		5		—		622
Operating and maintenance	4,088		1,020		—		5,108
Selling, general and administrative	1,723		313		3,137		5,173
Goodwill impairment loss	33,589		—		—		33,589
Depreciation and amortization	5,422		—		—		5,422
Total operating costs	55,231		1,338		3,137		59,706
Operating loss	(26,291)		(72)		(3,137)		(29,500)
Interest expense	—		—		2,739		2,739
Loss associated with derivative instruments	—		—		2,873		2,873
Foreign currency transaction gain	(74)		(6)		(12)		(92)
Other income, net	(729)		—		(3)		(732)
Benefit from income taxes	(47)		(460)		—		(507)
Net income (loss)	$	(25,441)	$	394	$	(8,734)	$	(33,781)

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Segment Adjusted EBITDA

The following tables present the computation of Segment Adjusted EBITDA, which is a measure determined in accordance with GAAP, for each of our segments for the periods indicated:

		Three Months Ended March 31,
Terminalling Services Segment		2021		2020
	(in thousands)
Net income (loss)		$	9,297	$	(25,441)
Interest income (1)		(1)		(21)
Depreciation and amortization		5,471		5,422
Provision for (benefit from) income taxes		197		(47)
Foreign currency transaction loss (gain) (2)		133		(74)
Goodwill impairment loss		—		33,589
Non-cash deferred amounts (3)		1,683		437
Segment Adjusted EBITDA		$	16,780	$	13,865

(1)    Represents interest income associated with our Terminalling Services segment that is included in “Other income, net” in our consolidated statements of operations.

(2)    Represents foreign exchange transaction amounts associated with activities between our U.S. and Canadian subsidiaries.

(3)    Represents the change in non-cash contract assets and liabilities associated with revenue recognized at blended rates based on tiered rate structures in certain of our customer contracts and deferred revenue associated with deficiency credits that are expected to be used in the future prior to their expiration. Amounts presented are net of the corresponding prepaid Gibson pipeline fee that will be recognized as expense concurrently with the recognition of revenue.

		Three Months Ended March 31,
Fleet Services Segment		2021		2020
	(in thousands)
Net income		$	118	$	394
Provision for (benefit from) income taxes		27		(460)
Foreign currency transaction gain (1)		—		(6)
Segment Adjusted EBITDA		$	145	$	(72)

(1)    Represents foreign exchange transaction amounts associated with activities between our U.S. and Canadian subsidiaries.

15. DERIVATIVE FINANCIAL INSTRUMENTS

Our net income, or loss, and cash flows are subject to fluctuations resulting from changes in interest rates on our variable rate debt obligations and from changes in foreign currency exchange rates, particularly with respect to the U.S. dollar and the Canadian dollar. In limited circumstances, we may also hold long positions in the commodities we handle on behalf of our customers, which exposes us to commodity price risk. We use derivative financial instruments, including futures, forwards, swaps, options and other financial instruments with similar characteristics, to manage the risks associated with market fluctuations in interest rates, foreign currency exchange rates and commodity prices, as well as to reduce volatility in our cash flows. We have not historically designated, nor do we expect to designate, our derivative financial instruments as hedges of the underlying risk exposure. All of our financial instruments are employed in connection with an underlying asset, liability and/or forecasted transaction and are not entered into for speculative purposes.

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Interest Rate Derivatives

We use interest rate derivative financial instruments to partially mitigate our exposure to interest rate fluctuations on our variable rate debt. Under our Credit Agreement, one-month LIBOR is used as the index rate for the interest we are charged on amounts borrowed under our Revolving Credit Facility.

In November 2017, we entered into a five-year interest rate collar contract with a $100 million notional value. The collar established a range where we paid the counterparty if the one-month Overnight Index Swap, or OIS, fell below the established floor rate of 1.70%, and the counterparty paid us if the one-month OIS rate exceeded the established ceiling rate of 2.50%. The collar settled monthly through the termination date. No payments or receipts were exchanged on the interest rate collar contracts unless interest rates rose above or fell below the predetermined ceiling or floor rate. Prior to February 2019, our interest rate collar contract discussed above was based on one-month LIBOR, which is being phased out by financial institutions in the United States.

In September 2020, we terminated our existing interest rate collar discussed above and simultaneously entered into a new interest rate swap that was made effective as of August 2020. The new interest rate swap is a five-year contract with a $150 million notional value that fixes our one-month LIBOR to 0.84% for the notional value of the swap agreement instead of the variable rate that we pay under our Credit Agreement. The swap settles monthly through the termination date in August 2025.

Derivative Positions

We record all of our derivative financial instruments at their fair values in the line items specified below within our consolidated balance sheets, the amounts of which were as follows at the dates indicated:

	March 31, 2021		December 31, 2020
	(in thousands)
Other non-current assets	577		—
Other current liabilities	$	(1,067)	$	(1,086)
Other non-current liabilities	—		(2,743)
	$	(490)	$	(3,829)

We have not designated our derivative financial instruments as hedges of our interest rate exposure. As a result, changes in the fair value of these derivatives are recorded as “Loss (gain) associated with derivative instruments” in our consolidated statements of operations. The gains or losses associated with changes in the fair value of our derivative contracts do not affect our cash flows until the underlying contract is settled by making or receiving a payment to or from the counterparty. In connection with our derivative activities, we recognized the following amounts during the periods presented:

		Three Months Ended March 31,
		2021		2020
	(in thousands)
Loss (gain) associated with derivative instruments		$	(3,076)	$	2,873

We determine the fair value of our derivative financial instruments using third party pricing information that is derived from observable market inputs, which we classify as level 2 with respect to the fair value hierarchy.

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The following table presents summarized information about the fair values of our outstanding interest rate contracts for the periods indicated:

					March 31, 2021		December 31, 2020
	Notional		Interest Rate Parameters		Fair Value		Fair Value
					(in thousands)
Swap Agreements
Swap maturing August 2025	$	150,000,000	0.84	%	$	(490)	$	(3,829)

16. PARTNERS’ CAPITAL

Our common units represent and subordinated units represented limited partner interests in us. The holders of common units are and subordinated units were entitled to participate in partnership distributions and to exercise the rights and privileges available to limited partners under our partnership agreement.

All of our subordinated units converted into common units on a one-for-one basis in separate sequential tranches. Each tranche was comprised of 20.0% of the subordinated units issued in conjunction with our IPO. Each separate tranche was eligible to convert on or after December 31, 2015 (but no more frequently than once in any twelve-month period), provided on such date: (i) distributions of available cash from operating surplus on each of the outstanding common units, Class A units, subordinated units and general partner units equaled or exceeded $1.15 per unit (the annualized minimum quarterly distribution) for the four quarter period immediately preceding that date; (ii) the adjusted operating surplus generated during the four quarter period immediately preceding that date equaled or exceeded the sum of $1.15 per unit (the annualized minimum quarterly distribution) on all of the common units, Class A units, subordinated units and general partner units outstanding during that period on a fully diluted basis; and (iii) there were no arrearages in the payment of the minimum quarterly distribution on our common units. For each successive tranche, the four quarter period specified in clauses (i) and (ii) above must have commenced after the four quarter period applicable to any prior tranche of subordinated units. In February 2020, pursuant to the terms set forth in our partnership agreement, we converted the fifth and final tranche of 2,092,709 of our subordinated units into common units upon satisfaction of the conditions established for conversion.

Pursuant to the terms of the USD Partners LP Amended and Restated 2014 Long-Term Incentive Plan, which we refer to as the A/R LTIP, our phantom unit awards, or Phantom Units, granted to directors and employees of our general partner and its affiliates, which are classified as equity, are converted into our common units upon vesting. Equity-classified Phantom Units totaling 557,579 vested during the first three months in 2021, of which 379,726 were converted into our common units after 177,853 Phantom Units were withheld from participants for the payment of applicable employment-related withholding taxes. The conversion of these Phantom Units did not have any economic impact on Partners’ Capital, since the economic impact is recognized over the vesting period. Additional information and discussion regarding our unit based compensation plans is included below in Note 17. Unit Based Compensation.

The board of directors of our general partner has adopted a cash distribution policy pursuant to which we intend to distribute at least the minimum quarterly distribution of $0.2875 per unit ($1.15 per unit on an annualized basis) on all of our units to the extent we have sufficient available cash after the establishment of cash reserves and the payment of our expenses, including payments to our general partner and its affiliates. The board of directors of our general partner may change our distribution policy at any time and from time to time. Our partnership agreement does not require us to pay cash distributions on a quarterly or other basis. The amount of distributions we pay under our cash distribution policy and the decision to make any distribution are determined by our general partner. For the quarter ended March 31, 2021, the board of directors of our general partner determined that we had sufficient available cash after the establishment of cash reserves and the payment of our expenses to distribute $0.1135 per unit on all of our units.

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17. UNIT BASED COMPENSATION

Long-term Incentive Plan

In 2021 and 2020, the board of directors of our general partner, acting in its capacity as our general partner, approved the grant of 667,543 and 694,140 Phantom Units, respectively, to directors and employees of our general partner and its affiliates under our A/R LTIP. At March 31, 2021, we had 501,448 Phantom Units remaining available for issuance. The Phantom Units are subject to all of the terms and conditions of the A/R LTIP and the Phantom Unit award agreements, which are collectively referred to as the Award Agreements. Award amounts for each of the grants are generally determined by reference to a specified dollar amount based on an allocation formula which included a percentage multiplier of the grantee’s base salary, among other factors, converted to a number of units based on the closing price of one of our common units preceding the grant date, as determined by the board of directors of our general partner and quoted on the NYSE.

Phantom Unit awards generally represent rights to receive our common units upon vesting. However, with respect to the awards granted to directors and employees of our general partner and its affiliates domiciled in Canada, for each Phantom Unit that vests, a participant is entitled to receive cash for an amount equivalent to the closing market price of one of our common units on the vesting date. Each Phantom Unit granted under the Award Agreements includes an accompanying distribution equivalent right, or DER, which entitles each participant to receive payments at a per unit rate equal in amount to the per unit rate for any distributions we make with respect to our common units. The Award Agreements granted to employees of our general partner and its affiliates generally contemplate that the individual grants of Phantom Units will vest in four equal annual installments based on the grantee’s continued employment through the vesting dates specified in the Award Agreements, subject to acceleration upon the grantee’s death or disability, or involuntary termination in connection with a change in control of the Partnership or our general partner. Awards to independent directors of the board of our general partner and an independent consultant typically vest over a one year period following the grant date.

The following tables present the award activity for our Equity-classified Phantom Units:

	Director and Independent Consultant Phantom Units	Employee Phantom Units	Weighted-Average Grant Date Fair Value Per Phantom Unit
Phantom Unit awards at December 31, 2020	40,065	1,324,837	$	10.98
Granted	40,065	573,204	$	4.82
Vested	(40,065)	(517,514)	$	11.33
Forfeited	—	(2,075)	$	8.44
Phantom Unit awards at March 31, 2021	40,065	1,378,452	$	8.18

	Director and Independent Consultant Phantom Units	Employee Phantom Units	Weighted-Average Grant Date Fair Value Per Phantom Unit
Phantom Unit awards at December 31, 2019	37,139	1,252,544	$	11.34
Granted	40,065	594,912	$	10.15
Vested	(37,139)	(481,336)	$	10.84
Forfeited	—	(38,507)	$	11.08
Phantom Unit awards at March 31,  2020	40,065	1,327,613	$	10.98

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The following tables present the award activity for our Liability-classified Phantom Units:

	Director and Independent Consultant Phantom Units	Employee Phantom Units	Weighted-Average Grant Date Fair Value Per Phantom Unit
Phantom Unit awards at December 31, 2020	13,136	59,284	$	10.58
Granted	13,136	41,138	$	4.82
Vested	(13,136)	—	$	10.15
Phantom Unit awards at March 31, 2021	13,136	100,422	$	7.88

	Director and Independent Consultant Phantom Units	Employee Phantom Units	Weighted-Average Grant Date Fair Value Per Phantom Unit
Phantom Unit awards at December 31, 2019	12,177	44,620	$	11.53
Granted	13,136	46,027	$	10.15
Vested	(12,177)	—	$	11.37
Phantom Unit awards at March 31,  2020	13,136	90,647	$	10.76

The fair value of each Phantom Unit on the grant date is equal to the closing market price of our common units on the grant date. We account for the Phantom Unit grants to independent directors and employees of our general partner and its affiliates domiciled in Canada that are paid out in cash upon vesting, throughout the requisite vesting period, by revaluing the unvested Phantom Units outstanding at the end of each reporting period and recording a charge to compensation expense in “Selling, general and administrative” in our consolidated statements of operations and recognizing a liability in “Other current liabilities” in our consolidated balance sheets. With respect to the Phantom Units granted to consultants, independent directors and employees of our general partner and its affiliates domiciled in the United States, we amortize the initial grant date fair value over the requisite service period using the straight-line method with a charge to compensation expense in “Selling, general and administrative” in our consolidated statements of operations, with an offset to common units within the Partners’ Capital section of our consolidated balance sheet.

For the three months ended March 31, 2021 and 2020, we recognized $1.5 million and $1.6 million, respectively, of compensation expense associated with outstanding Phantom Units. As of March 31, 2021, we have unrecognized compensation expense associated with our outstanding Phantom Units totaling $11.6 million, which we expect to recognize over a weighted average period of 2.64 years. We have elected to account for actual forfeitures as they occur rather than using an estimated forfeiture rate to determine the number of awards we expect to vest.

We made payments to holders of the Phantom Units pursuant to the associated DERs we granted to them under the Award Agreements as follows:

		Three Months Ended March 31,
		2021		2020
	(in thousands)
Equity-classified Phantom Units (1)		$	152	$	477
Liability-classified Phantom Units		8		21
Total		$	160	$	498

(1)    We reclassified $2 thousand and $57 thousand to unit based compensation expense for DERs paid in relation to Phantom Units that have been forfeited for the three months ended March 31, 2021 and 2020, respectively.

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18. SUPPLEMENTAL CASH FLOW INFORMATION

The following table provides supplemental cash flow information for the periods indicated:

	Three Months Ended March 31,
	2021		2020
	(in thousands)
Cash paid for income taxes	$	286	$	317
Cash paid for interest	$	1,549	$	2,083
Cash paid for operating leases	$	1,566	$	1,885

Non-cash Investing Activities

For the three months ended March 31, 2021 and 2020, we had non-cash investing activities for capital expenditures for property and equipment that were financed through “Accounts payable and accrued expenses” as presented in the table below for the periods indicated:

	Three months ended March 31,
	2021		2020
	(in thousands)
Property and equipment financed through accounts payable and accrued expenses	$	136	$	(182)

We recorded $37 thousand and $2.8 million of right-of-use lease assets and the associated liabilities on our consolidated balance sheet as of March 31, 2021 and 2020, respectively, representing non-cash activities resulting from either new or extended lease agreements. See Note 7. Leases for further discussion.

19. SUBSEQUENT EVENTS

Distribution to Partners

On April 22, 2021, the board of directors of USD Partners GP LLC, acting in its capacity as our general partner, declared a quarterly cash distribution payable of $0.1135 per unit, or $0.454 per unit on an annualized basis, for the three months ended March 31, 2021. The distribution will be paid on May 14, 2021, to unitholders of record at the close of business on May 5, 2021. The distribution will include payment of $1.8 million to our public common unitholders, $1.3 million to USDG as a holder of our common units and $52 thousand to USD Partners GP LLC as a holder of the general partner interest.

Revolving Credit Facility Activity

Subsequent to March 31, 2021, we repaid $3.0 million under the terms of our existing $385 million Revolving Credit Facility. As of May 3, 2021, we had amounts outstanding of $186.0 million under the Revolving Credit Facility and $199.0 million available for borrowings under the Revolving Credit Facility based on capacity that is subject to certain covenants. Refer to Note 9. Debt for more information.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

The following discussion and analysis of our financial condition and results of operations is based on and should be read in conjunction with the unaudited consolidated financial statements and accompanying notes in “Item 1. Financial Statements” contained herein and our audited consolidated financial statements and accompanying notes included in “Item 8. Financial Statements and Supplementary Data” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2020. Among other things, those consolidated financial statements include more detailed information regarding the basis of presentation for the following discussion and analysis. This discussion contains forward-looking statements that involve risks and uncertainties. Our actual results could differ materially from those discussed below. Factors that could cause or contribute to such differences include, but are not limited to, those identified below and those discussed in “Item 1A. Risk Factors” included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2020 and subsequent Quarterly Reports on Form 10-Q. Please also read the “Cautionary Note Regarding Forward-Looking Statements” following the table of contents in this Report.

We denote amounts denominated in Canadian dollars with “C$” immediately prior to the stated amount.

Overview

We are a fee-based, growth-oriented master limited partnership formed by our sponsor, USD, to acquire, develop and operate midstream infrastructure and complementary logistics solutions for crude oil, biofuels and other energy-related products. We generate substantially all of our operating cash flows from multi-year, take-or-pay contracts with primarily investment grade customers, including major integrated oil companies, refiners and marketers. Our network of crude oil terminals facilitates the transportation of heavy crude oil from Western Canada to key demand centers across North America. Our operations include railcar loading and unloading, storage and blending in onsite tanks, inbound and outbound pipeline connectivity, truck transloading, as well as other related logistics services. We also provide our customers with leased railcars and fleet services to facilitate the transportation of liquid hydrocarbons by rail.

We generally do not take ownership of the products that we handle nor do we receive any payments from our customers based on the value of such products. We may on occasion enter into buy-sell arrangements in which we take temporary title to commodities while in our terminals. We expect any such arrangements to be at fixed prices where we do not take any exposure to changes in commodity prices.

We believe rail will continue as an important transportation option for energy producers, refiners and marketers due to its unique advantages relative to other transportation means. Specifically, rail transportation of energy-related products provides flexible access to key demand centers on a relatively low fixed-cost basis with faster physical delivery, while preserving the specific quality of customer products over long distances.

USDG, a wholly-owned subsidiary of USD, and the sole owner of our general partner, is engaged in designing, developing, owning, and managing large-scale multi-modal logistics centers and energy-related infrastructure across North America. USDG’s solutions create flexible market access for customers in significant growth areas and key demand centers, including Western Canada, the U.S. Gulf Coast and Mexico. Among other projects, USDG is currently pursuing the development of a premier energy logistics terminal on the Houston Ship Channel with capacity for substantial tank storage, multiple docks (including barge and deepwater), inbound and outbound pipeline connectivity, as well as a rail terminal with unit train capabilities. USDG completed an expansion project in January 2019 at the Partnership’s Hardisty Terminal, referred to herein as Hardisty South, which added one and one-half 120-railcar unit trains of transloading capacity per day, or approximately 112,500 barrels per day, or bpd.

USD, along with its partner, Gibson, is also pursuing long-term solutions to transport heavier grades of crude oil produced in Western Canada through the construction of a Diluent Recovery Unit, or DRU, at the Hardisty terminal. Construction of the project is progressing and USD expects that construction of the DRU will reach substantial completion in July of 2021, ramping to its full capacity in August of 2021. USD has secured the necessary financing, obtained all material permits and entered into fixed-price construction contracts regarding the

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construction of the project. USD’s patented DRU technology separates the diluent that has been added to the raw bitumen in the production process which meets two important market needs – it returns the recovered diluent for reuse in the Alberta market, reducing delivered costs for diluent, and it creates DRUbit™, a proprietary heavy Canadian crude oil specifically designed for rail transportation. DRUbit™ is crude oil or bitumen that has been returned to a more concentrated, viscous state that is classified as a non-hazardous, non-flammable commodity when transported by rail in Canada and the United States. DRUbit™ is a market access solution that will help satisfy demand for heavy Canadian crude oil on the U.S. Gulf Coast and in other markets at a cost that is economically competitive to the crude oil that is transported by pipeline. In addition, USD is constructing a new destination terminal in Port Arthur, Texas for the DRUbit™ that will be transloaded at our Hardisty origination terminal.

Recent Developments

Market Update

Substantially all of our operating cash flows are generated from take-or-pay contracts and, as a result, are not directly related to actual throughput volumes at our crude oil terminals. Throughput volumes at our terminals are primarily influenced by the difference in price between Western Canadian Select, or WCS, and other grades of crude oil, commonly referred to as spreads, rather than absolute price levels. WCS spreads are influenced by several market factors, including the availability of supplies relative to the level of demand from refiners and other end users, the price and availability of alternative grades of crude oil, the availability of takeaway capacity, as well as transportation costs from supply areas to demand centers.

COVID-19 and Crude Oil Pricing Environment Update

During 2020, the COVID-19 pandemic adversely affected the global economy, disrupted global supply chains and created significant volatility in the financial markets. As a result, beginning in March 2020, there was significant reductions in demand for, and fluctuations in the prices of crude oil, natural gas and natural gas liquids. This significantly impacted Canadian producers, which in turn resulted in lower crude oil prices and led to lower throughput volume through our facilities.

There still remains considerable uncertainty about the ultimate impact and duration of the pandemic and its effects on the global economy and specifically energy demand. Despite these uncertainties, efforts to reopen the economy have continued to lead to marginal increases in the demand for crude oil and petroleum products. As a result, crude oil prices have recovered and stabilized at pre-pandemic levels, as compared to the lower price levels that were present during early to mid-2020. Global production levels are also expected to continue to increase as demand continues to recover. In April 2021 members of the Organization of the Petroleum Exporting Countries and other oil producing countries including Russia, or OPEC+, announced that they will add back two million barrels per day, or bpd, to production from its previous production cuts during May 2021 to July 2021. We believe that if the increases in demand for oil and natural gas continue, production levels will continue to trend higher during 2021. However, there still remains significant uncertainty given the unprecedented and evolving nature of the COVID-19 pandemic, and the extent of any increases in demand and price levels are difficult to predict.

The broader implications of COVID-19 and volatile oil and natural gas prices on our results of operations and overall financial performance remain uncertain. We have implemented protocols and procedures designed to manage risk associated with the direct impact of COVID-19 on our operations. We have not experienced material disruptions to our operations or material increase in our cash expenses. Currently, we expect to have sufficient liquidity to operate our business and remain in compliance with the financial covenants under our credit agreement for at least the next twelve months following the filing of this report and we do not expect our customers to terminate existing contracts. However, if the pandemic continues for a further extended period of time and/or oil prices decrease to relatively low levels, these conditions may have an adverse effect on the Company’s results of future operations, financial position, and liquidity. Given the unprecedented and evolving nature of the COVID-19 pandemic and the state of the commodity markets, we continue to actively monitor their impact on our operations and financial condition. Refer to Item 1A. Risk Factors in our Annual Report on Form 10-K for the fiscal year ended December 31, 2020 for further discussion of certain risks relating to the COVID-19 pandemic.

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Impact of Current Market Events

Given that crude oil prices have recovered and stabilized to pre-COVID levels, Canadian production that was temporarily shut-in due to COVID-19 has also returned to pre-COVID levels. Additionally, in January 2021, the Canadian Association of Petroleum Producers, or CAPP, announced that they are forecasting more than a $3 billion dollar increase in planned upstream oil and gas spending as compared to 2020 levels. We anticipate Canadian supply will continue to increase as a result of the planned increased investment.

Due to the anticipated increase in the supply of Canadian crude oil as discussed above, supply is likely to continue to be higher than the available pipeline takeaway capacity out of Western Canada. Further, the efforts to increase the available pipeline takeaway capacity from Western Canada continue to face regulatory headwinds, as discussed in more detail below. As a result of this imbalance between supply and pipeline egress capacity, in the first quarter of 2021 apportionment levels (representing the percentage of barrels nominated that were not shipped due to pipeline capacity constraints) on the primary heavy crude oil pipelines from Western Canada to the U.S. increased to an average of 48%. Consistent with the increases in supply and apportionment levels, crude oil inventory levels increased by approximately 15% during the first quarter of 2021 as compared to levels at the end of the fourth quarter 2020.

Given these current market conditions as outlined above, our expectations are that WCS prices will reflect the need and incentivize egress by rail from Hardisty. The amount by which the West Texas Intermediate, or WTI, price of crude oil exceeds the WCS price of crude oil, referred to as the WCS to WTI spread, is a driver of activity at our Hardisty Terminal by providing the economic incentive to export barrels by rail. During the first quarter of 2021, the WCS to WTI spread was between $10 and $15 per barrel. Future WCS to WTI spreads recently published by Bloomberg for 2022 through 2024 average approximately $13.50 per barrel and reach approximately $16 per barrel towards the end of 2024, which supports the economics required for a crude by rail egress solution.

Based on the forecasted crude oil production increases in Canada and higher apportionment and crude oil inventory levels, we expect that throughput volumes at our Hardisty Terminal will continue to trend upwards throughout 2021, from the low levels that existed during 2020, with the potential of reaching pre-COVID levels. There still remains significant uncertainty given the unprecedented and evolving nature of the COVID-19 pandemic, and the extent and duration of any increases in apportionment or inventory levels are difficult to predict, if such increases occur at all.

Another factor that may contribute to the use of rail to export crude oil from Canada to the U.S. is the significant regulatory and legal obstacles that pipeline projects and existing pipelines experience in the U.S. For example, in March 2020, the government of Alberta announced that it had reached an agreement to make a $1.5 billion equity investment in the Keystone XL crude oil pipeline project in 2020 followed by a $6 billion loan guarantee in 2021 in order to enable the completion of the project by 2023. However, in January 2021, the new U.S. President issued an executive action that revoked the permit for the Keystone XL pipeline. Additionally, the anticipated in-service date of Enbridge’s Line 3 Replacement project to upgrade and expand an existing pipeline delivering Western Canadian crude to U.S. markets has been delayed until the fourth quarter of 2021 and could face potential legal disputes. Current pipeline operators are also facing legal challenges to keep their pipelines in operation. The Dakota Access Pipeline is in the middle of a legal dispute to determine whether the pipeline can continue to operate without a key easement, although the pipeline can operate until a decision is made by federal courts. Enbridge’s Line 5 is also in jeopardy of being shut down as Michigan’s Governor has demanded that the pipeline be shut down by May 12, 2021. The Governor has revoked a 1953 Michigan easement that allowed Line 5 to pass through the bottom of the Straits of Mackinac. As environmental, regulatory and political challenges to increase pipeline export capacity remain, crude by rail exports will remain a valuable egress solution.

In the long-term, as stated above, we expect demand for rail capacity at our terminals to continue to increase over the next several years and potentially longer if proposed pipeline developments do not meet currently planned timelines and regulatory or other challenges to pipeline projects persist. Our Hardisty and Casper terminals, with established capacity and scalable designs, are well-positioned as strategic outlets to meet takeaway needs as Western Canadian crude oil supplies continue to exceed available pipeline takeaway capacity. Also, as discussed in more detail in our Annual Report on Form 10-K for the fiscal year ended December 31, 2020, USD is pursuing long-term

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solutions to transport heavier grades of crude oil produced in Western Canada through the construction of the DRU at the Hardisty terminal. Additionally, we believe our Stroud Terminal provides an advantageous rail destination for Western Canadian crude oil given the optionality provided by its connectivity to the Cushing hub and multiple refining centers across the United States. Rail also generally provides a greater ability to preserve the specific quality of a customer’s product relative to pipelines, providing value to a producer or refiner. We expect these advantages, including our origin-to-destination capabilities, to continue to result in long-term contract extensions and expansion opportunities across our terminal network.

How We Generate Revenue

We conduct our business through two distinct reporting segments: Terminalling services and Fleet services. We have established these reporting segments as strategic business units to facilitate the achievement of our long-term objectives, to assist in resource allocation decisions and to assess operational performance.

Terminalling Services

The terminalling services segment includes a network of strategically-located terminals that provide customers with railcar loading and/or unloading capacity, as well as related logistics services, for crude oil and biofuels. Substantially all of our cash flows are generated under multi-year, take-or-pay terminal services agreements that include minimum monthly commitment fees. We generally have no direct commodity price exposure, although fluctuating commodity prices could indirectly influence our activities and results of operations over the long term. We may on occasion enter into buy-sell arrangements in which we take temporary title to commodities while in our terminals. We expect any such agreements to be at fixed prices where we do not take commodity price exposure.

Our Hardisty Terminal is an origination terminal where we load into railcars various grades of Canadian crude oil received from Gibson’s Hardisty storage terminal. Our Hardisty Terminal can load up to two 120-railcar unit trains per day and consists of a fixed loading rack with approximately 30 railcar loading positions, a unit train staging area and loop tracks capable of holding five unit trains simultaneously.

Our Stroud Terminal is a crude oil destination terminal in Stroud, Oklahoma, which we use to facilitate rail-to-pipeline shipments of crude oil from our Hardisty Terminal to the crude oil storage hub located in Cushing, Oklahoma. The Stroud Terminal includes 76-acres with current unit train unloading capacity of approximately 50,000 Bpd, two onsite tanks with 140,000 barrels of capacity, one truck bay, and a 12-inch diameter, 17-mile pipeline with a direct connection to the crude oil storage hub in Cushing Oklahoma. Our Stroud Terminal was purchased in June 2017 and commenced operations in October 2017.

Our Casper Terminal is a crude oil storage, blending and railcar loading terminal. The terminal currently offers six storage tanks with 900,000 barrels of total capacity, unit train-capable railcar loading capacity in excess of 100,000 bpd, as well as truck transloading capacity. Our Casper Terminal is supplied with multiple grades of Canadian crude oil through a direct connection with the Express Pipeline. Additionally, the Casper Terminal has a connection from the Platte terminal, where it has access to other pipelines and can receive other grades of crude oil, including locally sourced Wyoming sour crude oil. The Casper Terminal can also receive volumes through one truck unloading station and is also equipped with one truck loading station. Additionally, to supplement the rail loading options from the terminal, we constructed an outbound pipeline connection from the Casper Terminal to the nearby Platte terminal located at the termination point of the Express pipeline that was placed into service in December 2019.

Our West Colton Terminal is a unit train-capable destination terminal that can transload up to 13,000 bpd of ethanol received from producers by rail onto trucks to meet local demand in the San Bernardino and Riverside County-Inland Empire region of Southern California. The West Colton Terminal has 20 railcar offloading positions and three truck loading positions.

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Fleet Services

We provide one of our customers with leased railcars and fleet services related to the transportation of liquid hydrocarbons by rail on multi-year, take-or-pay terms under a master fleet services agreement. We do not own any railcars. As of March 31, 2021, our railcar fleet consisted of 200 railcars, which we lease from a railcar manufacturer, all of which are coiled and insulated, or C&I, railcars. The weighted average remaining contract life on our railcar fleet is 1.8 years as of March 31, 2021.

Under the master fleet services agreement, we provide customers with railcar-specific fleet services, which may include, among other things, the provision of relevant administrative and billing services, the repair and maintenance of railcars in accordance with standard industry practice and applicable law, the management and tracking of the movement of railcars, the regulatory and administrative reporting and compliance as required in connection with the movement of railcars, and the negotiation for and sourcing of railcars. Our customer typically pays us and our assignees monthly fees per railcar for these services, which include a component for fleet services.

Historically, we contracted with railroads on behalf of some of our customers to arrange for the movement of railcars from our terminals to the destinations selected by our customers. We were the contracting party with the railroads for those shipments and were responsible to the railroads for the related fees charged by the railroads, for which we were reimbursed by our customers. Both the fees charged by the railroads to us and the reimbursement of these fees by our customers are included in our consolidated statements of operations in the revenues and operating costs line items entitled “Freight and other reimbursables.”

Also, we have historically assisted our customers with procuring railcars to facilitate their use of our terminalling services. Our wholly-owned subsidiary USD Rail LP has historically entered into leases with third-party manufacturers of railcars and financial firms, which it has then leased to customers. Although we expect to continue to assist our customers in obtaining railcars for their use transporting crude oil to or from our terminals, we do not intend to continue to act as an intermediary between railcar lessors and our customers as our existing lease agreements expire, are otherwise terminated, or are assigned to our existing customers. Should market conditions change, we could potentially act as an intermediary with railcar lessors on behalf of our customers again in the future.

How We Evaluate Our Operations

Our management uses a variety of financial and operating metrics to evaluate our operations. When we evaluate our consolidated operations and related liquidity, we consider these metrics to be significant factors in assessing our ability to generate cash and pay distributions and include: (i) Adjusted EBITDA and DCF; (ii) operating costs; and (iii) volumes. We define Adjusted EBITDA and DCF below. When evaluating our operations at the segment level, we evaluate using Segment Adjusted EBITDA. Refer to Part I, Item 8. Financial Statements and Supplementary Data, Note 14. Segment Reporting.

Adjusted EBITDA and Distributable Cash Flow

We define Adjusted EBITDA as “Net cash provided by operating activities” adjusted for changes in working capital items, interest, income taxes, foreign currency transaction gains and losses, and other items which do not affect the underlying cash flows produced by our businesses. Adjusted EBITDA is a non-GAAP, supplemental financial measure used by management and external users of our financial statements, such as investors and commercial banks, to assess:

•our liquidity and the ability of our business to produce sufficient cash flow to make distributions to our unitholders; and

•our ability to incur and service debt and fund capital expenditures.

We define Distributable Cash Flow, or DCF, as Adjusted EBITDA less net cash paid for interest, income taxes and maintenance capital expenditures. DCF does not reflect changes in working capital balances. DCF is a non-GAAP, supplemental financial measure used by management and by external users of our financial statements, such as investors and commercial banks, to assess:

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•the amount of cash available for making distributions to our unitholders;

•the excess cash flow being retained for use in enhancing our existing business; and

•the sustainability of our current distribution rate per unit.

We believe that the presentation of Adjusted EBITDA and DCF in this Report provides information that enhances an investor’s understanding of our ability to generate cash for payment of distributions and other purposes. The GAAP measure most directly comparable to Adjusted EBITDA and DCF is “Net cash provided by operating activities.” Adjusted EBITDA and DCF should not be considered alternatives to “Net cash provided by operating activities” or any other measure of liquidity presented in accordance with GAAP. Adjusted EBITDA and DCF exclude some, but not all, items that affect “Net cash provided by operating activities,” and these measures may vary among other companies. As a result, Adjusted EBITDA and DCF may not be comparable to similarly titled measures of other companies. 

The following table sets forth a reconciliation of Net cash provided by operating activities, the most directly comparable financial measure calculated and presented in accordance with GAAP, to Adjusted EBITDA and DCF:

		Three Months Ended March 31,
		2021		2020
	(in thousands)
Reconciliation of Net cash provided by operating activities to Adjusted EBITDA and Distributable cash flow:
Net cash provided by operating activities		$	12,645	$	11,717
Add (deduct):
Amortization of deferred financing costs		(207)		(207)
Deferred income taxes		18		352
Changes in accounts receivable and other assets		(4)		1,803
Changes in accounts payable and accrued expenses		(265)		(898)
Changes in deferred revenue and other liabilities		(1,216)		(3,035)
Interest expense, net		1,734		2,715
Provision for (benefit from) income taxes		224		(507)
Foreign currency transaction gain (1)		(61)		(92)
Non-cash deferred amounts (2)		1,683		437
Adjusted EBITDA		14,551		12,285
Add (deduct):
Cash paid for income taxes		(286)		(317)
Cash paid for interest		(1,549)		(2,083)
Maintenance capital expenditures		(203)		(32)
Distributable cash flow		$	12,513	$	9,853

(1)    Represents foreign exchange transaction amounts associated with activities between our U.S. and Canadian subsidiaries.

(2)    Represents the change in non-cash contract assets and liabilities associated with revenue recognized at blended rates based on tiered rate structures in certain of our customer contracts and deferred revenue associated with deficiency credits that are expected to be used in the future prior to their expiration. Amounts presented are net of the corresponding prepaid Gibson pipeline fee that will be recognized as expense concurrently with the recognition of revenue.

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Operating Costs

Our operating costs are comprised primarily of subcontracted rail services, pipeline fees, repairs and maintenance expenses, materials and supplies, utility costs, insurance premiums and lease costs for facilities and equipment. In addition, our operating expenses include the cost of leasing railcars from third-party railcar suppliers and the shipping fees charged by railroads, which costs are generally passed through to our customers. We expect our expenses to remain relatively stable, but they may fluctuate from period to period depending on the mix of activities performed during a period and the timing of these expenditures. We expect to incur additional operating costs, including subcontracted rail services and pipeline fees, when we handle additional volumes at our terminals.

Our management seeks to maximize the profitability of our operations by effectively managing both our operating and maintenance expenses. As our terminal facilities and related equipment age, we expect to incur regular maintenance expenditures to maintain the operating capabilities of our facilities and equipment in compliance with sound business practices, our contractual relationships and regulatory requirements for operating these assets. We record these maintenance and other expenses associated with operating our assets in “Operating and maintenance” costs in our consolidated statements of operations.

Volumes

The amount of Terminalling services revenue we generate depends on minimum customer commitment fees and the throughput volume that we handle at our terminals in excess of those minimum commitments. These volumes are primarily affected by the supply of and demand for crude oil, refined products and biofuels in the markets served directly or indirectly by our assets. Additionally, these volumes are affected by the spreads between the benchmark prices for these products, which are influenced by, among other things, the available takeaway capacity in those markets. Although customers at our terminals have committed to minimum monthly fees under their terminal services agreements with us, which will generate the majority of our Terminalling services revenue, our results of operations will also be affected by:

•our customers’ utilization of our terminals in excess of their minimum monthly volume commitments;

•our ability to identify and execute accretive acquisitions and commercialize organic expansion projects to capture incremental volumes; and

•our ability to renew contracts with existing customers, enter into contracts with new customers, increase customer commitments and throughput volumes at our terminals, and provide additional ancillary services at those terminals.

General Trends and Outlook

We expect our business to continue to be affected by the key trends and recent developments discussed in “Item 7. Management’s Discussion and Analysis of Financial Condition— Factors that May Impact Future Results of Operations” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2020. To the extent our underlying assumptions about or interpretations of available information prove to be incorrect, our actual results may vary materially from our expected results. The unprecedented nature of the COVID-19 pandemic, its impact on world economic conditions and the volatility in the oil and natural gas markets have created increased uncertainty with respect to future conditions and our ability to accurately predict future results.

Hardisty and Stroud Terminals Customer Contract Renewals

To date, we have renewed and extended 100% of the capacity at our Hardisty Terminal through mid-2022, with approximately 73% extended through mid-2023 with customers under multi-year take-or-pay agreements. Upon the successful completion of USD’s DRU project previously discussed, approximately 32% of the Hardisty Terminal’s capacity will be automatically extended through mid-2031. Certain of our terminalling services agreements at our Hardisty Terminal that expire in mid-2023 include a tiered rate structure that includes rate decreases that occur annually on July 1st of each year throughout the term of the agreement. Additionally, due to the significantly longer contract tenor of the terminalling services agreements associated with the DRU volumes, contracted rates on an annual basis will be lower as compared to historical, shorter-term, agreements, which will result in lower cash flows to the Partnership on an annual basis, but support a higher net present value to the

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Partnership and provide a more predictable cash flow profile. We remain focused on renewing, extending or replacing our agreements at Hardisty that expire in mid-2022 and mid-2023 with new, multi-year take or pay commitments, including, if USD and Gibson are successful in securing additional customers at the DRU, on a long-term basis similar to the existing DRU customer. In addition, we successfully re-contracted the capacity at our Stroud Terminal that was set to expire in June 2020 with a term that extends through June 2024. However, upon the successful completion of USD’s DRU project, our Stroud customer will have the right to terminate a portion of this agreement immediately and the remainder in June 2022, as previously discussed. Management believes that the lower utilization at the Stroud Terminal as a result of successful completion of the DRU project will be short-term in nature, and will allow the Partnership the opportunity to offer terminalling services to other customers that may be in need of access to the numerous markets connected to the Cushing oil hub.

Potential Impact of Hardisty and Stroud Deficiency Credit Usage by Our Customers

As previously discussed, customers of our Hardisty and Stroud Terminals are obligated to pay a minimum monthly commitment fee for the capacity to load an allotted number of unit trains, representing a specified number of barrels per month. If a customer loads fewer unit trains than its allotted amount in any given month, that customer will receive a credit for up to 12 months, also referred to as a deficiency credit. This credit may be used to offset fees on throughput volumes in excess of the customer’s minimum monthly commitments in future periods to the extent capacity is available for the excess volume. As of March 31, 2021, we deferred revenues of $0.6 million associated with the expected usage of the deficiency credits during 2021, which will remain deferred until either the deficiency credit has been used or the likelihood of the credit’s usage has been deemed remote. Additionally, we could incur incremental costs associated with loading the additional trains for our customers if they do use their accrued deficiency credits, but such costs are not expected to be material.

Casper Terminal Customer Contract Renewals

In July 2019, Enbridge Inc. announced a program to increase the capacity of the Express pipeline by up to an additional 50,000 bpd with the use of DRA and pump stations. We anticipate that some of the additional volumes resulting from the increased capacity on the Express pipeline could be delivered to our Casper Terminal, as we believe outbound pipeline connections from the Express pipeline and nearby terminals are at or near full capacity. Our ability to secure additional commercial opportunities and replace the revenue previously generated under the expired contracts may be limited until Enbridge successfully completes its DRA project. In late July 2020, Enbridge announced that it has placed 25,000 bpd of the additional capacity on its Express pipeline into service and plans to place the additional 25,000 bpd into service sometime in 2021.

Factors Affecting the Comparability of Our Financial Results

The comparability of our current financial results in relation to prior periods are affected by the factors described below.

Goodwill Impairment

In March 2020, we tested the goodwill associated with our Casper Terminal for impairment due to the overall downturn in the crude market and the decline in the demand for petroleum products, which could lead to delays or reductions of expected throughput levels and changes in expectations for current contracts in place at the Casper Terminal. As a result of our impairment testing, we recognized an impairment loss of $33.6 million for the three months ended March 31, 2020. We did not recognize a goodwill impairment loss for the three months ended March 31, 2021.

CARES Act

On March 27, 2020, United States legislation referred to as the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”), was signed into law. The CARES Act is an emergency economic stimulus package enacted in response to the coronavirus outbreak which, among other measures, contains numerous income tax provisions. Some of these tax provisions are expected to be effective retroactively for tax years ending before the date of enactment. For us, the most significant change included in the CARES Act was the impact to U.S. net operating loss carryback provisions. U.S. net operating losses incurred in tax years 2018, 2019, and 2020 can now be

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fully carried back to the preceding five tax years and may be used to fully offset taxable income (i.e. they are not subject to the 80 percent net income offset limitation of Section 172 of the U.S. Tax Code).

As a result of these CARES Act changes, for the three months ended March 31, 2020, we recognized a current tax benefit of $0.5 million for a claimable tax refund by carrying back U.S. net operating losses incurred in 2018, 2019, and 2020. We also recognized a one-time deferred tax expense of $46 thousand in the first quarter of 2020 due to the net effect of utilizing all U.S. net operating loss deferred tax assets and releasing the corresponding U.S. valuation allowance as of December 31, 2019. The tax impacts of the CARES Act were computed with the best available information, and will be adjusted after the 2020 U.S. tax return is finalized. However, we do not expect these adjustments to result in a material change to the tax provision in future periods.

Segment Allocation of Certain Selling, General and Administrative Costs

Historically, we have allocated certain selling, general and administrative expenses to our Terminalling services and Fleet services segments that included corporate function personnel costs for managing our business that are allocated to us by our general partner, as well as other administrative expenses including audit fees and certain consulting fees. Beginning with the first quarter in 2021, these selling, general, and administrative expenses that are not directly related to operating our Terminalling services and Fleet services segments will now be allocated to corporate selling, general, and administrative expenses to better reflect the financial results of our Terminalling services and Fleet services segments.

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RESULTS OF OPERATIONS

We conduct our business through two distinct reporting segments: Terminalling services and Fleet services. We have established these reporting segments as strategic business units to facilitate the achievement of our long-term objectives, to aid in resource allocation decisions and to assess operational performance.

The following table summarizes our operating results by business segment and corporate charges for each of the periods indicated:

		Three Months Ended March 31,
		2021		2020
	(in thousands)
Operating income (loss)
Terminalling services		$	9,607	$	(26,291)
Fleet services		145		(72)
Corporate and other		(3,622)		(3,137)
Total operating income (loss)		6,130		(29,500)
Interest expense		1,735		2,739
Loss (gain) associated with derivative instruments		(3,076)		2,873
Foreign currency transaction gain		(61)		(92)
Other income, net		(20)		(732)
Provision for (benefit from) income taxes		224		(507)
Net income (loss)		$	7,328	$	(33,781)

Summary Analysis of Operating Results

Changes in our operating results for the three months ended March 31, 2021, as compared with our operating results for the three months ended March 31, 2020, were primarily driven by:

•activities associated with our Terminalling services business including:

–higher revenue at our Stroud Terminal due to higher rates during the current quarter that are based on crude oil pricing index differentials, partially offset by deferred revenue associated with make-up right options we granted to customers;

–slightly lower revenue at our Hardisty Terminal due to a minor amount of revenue that was deferred in the first three months of 2021 associated with the make-up right options we granted to our customers as compared to the recognition of previously deferred revenue in the first quarter of 2020 associated with make-up rights, partially offset by a favorable variance on the change in the Canadian exchange rate associated with our Canadian-dollar denominated contracts and increased rates on certain of our Hardisty agreements when compared to the first quarter of 2020;

–lower operating costs resulting primarily from a non-cash impairment of the goodwill that was recognized in the first quarter of 2020 associated with our Casper Terminal due to economic conditions as a result of the COVID-19 pandemic, the overall downturn in the crude market and the decline in the demand for petroleum products with no comparable loss in 2021.

•a decrease in interest expense primarily due to lower interest rates coupled with a lower weighted average balance of debt outstanding;

•non-cash gains associated with increases in the fair value of our interest rate derivatives resulting from increases in the interest rate index upon which the derivative values are based; and

•an increase in provision from income taxes associated with our Fleet services segment primarily related to net operating loss carrybacks made available by provisions in the CARES Act in 2020 with no similar tax benefits recognized in 2021.

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A comprehensive discussion of our operating results by segment is presented below.

RESULTS OF OPERATIONS — BY SEGMENT

TERMINALLING SERVICES

The following table sets forth the operating results of our Terminalling services business and the approximate average daily throughput volumes of our terminals for the periods indicated:

		Three Months Ended March 31,
		2021		2020
	(in thousands)
Revenues
Terminalling services		$	29,208	$	28,323
Freight and other reimbursables		124		617
Total revenues		29,332		28,940
Operating costs
Subcontracted rail services		3,141		3,445
Pipeline fees		6,046		6,347
Freight and other reimbursables		124		617
Operating and maintenance		3,924		4,088
Selling, general and administrative		1,019		1,723
Goodwill impairment loss		—		33,589
Depreciation and amortization		5,471		5,422
Total operating costs		19,725		55,231
Operating income (loss)		9,607		(26,291)
Foreign currency transaction loss (gain)		133		(74)
Other income, net		(20)		(729)
Provision for (benefit from) income taxes		197		(47)
Net income (loss)		$	9,297	$	(25,441)
Average daily terminal throughput (bpd)		97,114		158,764

Three months ended March 31, 2021 compared with three months ended March 31, 2020

Terminalling Services Revenue

Revenue generated by our Terminalling services segment increased $0.4 million to $29.3 million for the three months ended March 31, 2021, as compared with $28.9 million for the three months ended March 31, 2020. This increase was primarily due to higher revenues at our Stroud Terminal in the three months ended March 31, 2021 due to higher rates that are based on crude oil pricing index differentials, partially offset by revenue that we deferred associated with the make-up right options we granted to customers of our Stroud Terminal. Also offsetting this increase in terminalling services revenue was a slight decrease in our Hardisty Terminal revenues. In the first quarter of 2020 revenues were recognized at our Hardisty Terminal that we previously deferred associated with the make-up right options we granted to customers as these rights were deemed unlikely to be used in future periods, while in the first quarter of 2021 we had a minor deferral of revenues associated with the Hardisty Terminal make-up rights. Partially offsetting these lower revenues at Hardisty was a favorable variance resulting from the Canadian exchange rate on our Canadian-dollar denominated contracts during the first quarter of 2021 as compared to the first quarter of 2020, discussed in more detail below. Additionally, we had increased rates on certain of our Hardisty agreements when compared to the first quarter of 2020.

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Our average daily terminal throughput decreased 61,650 bpd to 97,114 bpd for the three months ended March 31, 2021, as compared with 158,764 bpd for the three months ended March 31, 2020. Our throughput volumes decreased primarily due to a decrease in demand for export capacity by customers of our Hardisty Terminal during the first quarter of 2021 as compared to the relatively high level of demand that existed in the first quarter of 2020 prior to the impacts of the COVID-19 pandemic. A portion of our Hardisty throughput volumes also drives the demand for deliveries to our Stroud Terminal and its connection to the Cushing oil hub. Refer to Overview and Recent Developments — Market Update — COVID-19 and Crude Oil Pricing Environment Update for more information. Additionally, extreme cold temperatures experienced in the first quarter of 2021 at our Stroud Terminal led to a decrease in throughput at our Hardisty and Stroud Terminals during the quarter. Our terminalling services revenues are recognized based upon the contractual terms set forth in our agreements that contain primarily “take-or-pay” provisions, where we are entitled to the payment of minimum monthly commitment fees from our customers, which are recognized as revenue as we provide terminalling services.

Our terminalling services revenue for the three months ended March 31, 2021, would have been $1.2 million less if the average exchange rate for the Canadian dollar in relation to the U.S. dollar for the three months ended March 31, 2021, was the same as the average exchange rate for the three months ended March 31, 2020. The average exchange rate for the Canadian dollar in relation to the U.S. dollar was 0.7897 for the three months ended March 31, 2021 as compared with 0.7456 for the three months ended March 31, 2020.

Operating Costs

The operating costs of our Terminalling services segment decreased $35.5 million to $19.7 million for the three months ended March 31, 2021, as compared with $55.2 million for the three months ended March 31, 2020. The decrease is primarily attributable to an impairment of our goodwill recognized in the first quarter of 2020 at our Casper Terminal due to economic conditions in 2020, coupled with lower subcontracted rail services costs, pipeline fees and selling, general and administrative costs.

Our terminalling services operating costs for the three months ended March 31, 2021, would have been $0.6 million less if the average exchange rate for the Canadian dollar in relation to the U.S. dollar for the three months ended March 31, 2021, was the same as the average exchange rate for the three months ended March 31, 2020.

Subcontracted rail services. Our costs for subcontracted rail services decreased $0.3 million to $3.1 million for the three months ended March 31, 2021, as compared with $3.4 million for the three months ended March 31, 2020, primarily due to the reduced throughput at our terminals that occurred during the current quarter, as discussed above.

Pipeline fees. We incur pipeline fees related to a facilities connection agreement with Gibson for the delivery of crude oil from Gibson’s Hardisty storage terminal to our Hardisty Terminal via pipeline. The pipeline fees we pay to Gibson are based on a predetermined formula, which includes amounts collected from customers at our Hardisty Terminal less direct operating costs. Our pipeline fees decreased $0.3 million to $6.0 million for the three months ended March 31, 2021, as compared with $6.3 million for the three months ended March 31, 2020, primarily due to lower revenues at our Hardisty terminal. Additionally, we deferred a minor amount of pipeline fees during the three months ended March 31, 2021 associated with revenue we deferred for our customer’s expected future use of make-up rights at our Hardisty Terminal, as discussed above. However, during the first quarter of 2020, we recognized previously deferred pipeline fees associated with the make-up right options we granted to customers of our Hardisty terminal.

Selling, general and administrative. Selling, general and administrative expense decreased $0.7 million to $1.0 million for the three months ended March 31, 2021, as compared with $1.7 million for the three months ended March 31, 2020. The decrease is primarily due to a change in the allocation of certain selling, general and administrative expenses from the Terminalling services segment to corporate that are not directly related to operating our Terminalling services segment that began in the first quarter of 2021. As such, there is a corresponding increase in corporate selling, general and administrative costs during the first quarter of 2021, discussed below. Refer to Part I. Item 1. Financial Statements, Note 14. Segment reporting for further discussion on the change in segment cost allocation. Additionally, our Terminalling services segment selling, general and administrative costs

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decreased during the current quarter as compared to the first quarter of 2020 due to lower costs allocated to us associated with the management and operation of our terminals.

Goodwill impairment loss. In the first quarter of 2021, we had no goodwill impairment loss compared to the $33.6 million impairment loss that was recognized in the first quarter of 2020. In March 2020, we tested the goodwill associated with our Casper Terminal for impairment due to the overall downturn in the crude market and the decline in the demand for petroleum products. As a result of our impairment testing, we recognized an impairment loss of $33.6 million for the three months ended March 31, 2020.

Other Expenses (Income)

Other income, net. Other income, net decreased $0.7 million for the three months ended March 31, 2021, as compared with the three months ended March 31, 2020. This decrease is primarily associated with a decrease in income earned as an incentive for railcar movements of a customer at our Hardisty Terminal.

FLEET SERVICES

The following table sets forth the operating results of our Fleet services segment for the periods indicated:

		Three Months Ended March 31,
		2021		2020
	(in thousands)
Revenues
Fleet leases		$	984	$	984
Fleet services		251		277
Freight and other reimbursables		32		5
Total revenues		1,267		1,266
Operating costs
Freight and other reimbursables		32		5
Operating and maintenance		998		1,020
Selling, general and administrative		92		313
Total operating costs		1,122		1,338
Operating income (loss)		145		(72)
Foreign currency transaction loss (gain)		—		(6)
Provision for (benefit from) income taxes		27		(460)
Net income		$	118	$	394

Three months ended March 31, 2021 compared with three months ended March 31, 2020

The underlying business activities associated with our Fleet services segment have remained relatively constant for the three months ended March 31, 2021, as compared with three months ended March 31, 2020. As a result, we have experienced only modest changes in the operating revenues associated with this business. We expect only modest changes in the revenue results of our fleet services business for the near future.

Our selling, general and administrative expenses decreased $0.2 million to $0.1 million for the three months ended March 31, 2021 as compared with $0.3 million for the three months ended March 31, 2020. The decrease is primarily due to a change in the allocation of certain selling, general and administrative expenses from the Fleet services segment to corporate that are not directly related to operating our Fleet services segment that began in the first quarter of 2021. As such, there is a corresponding increase in corporate selling, general and administrative costs during the first quarter of 2021, discussed below. Refer to Part I. Item 1. Financial Statements, Note 14. Segment reporting for further discussion on the change in segment cost allocation. Additionally, our Fleet services segment

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selling, general and administrative costs decreased during the current quarter as compared to the first quarter of 2020 due to lower costs allocated to us associated with the management and operation of our fleet assets.

Our provision for income taxes in the Fleet services segment increased $0.5 million to a provision of $27 thousand for three months ended March 31, 2021 as compared with a benefit of $0.5 million for the three months ended March 31, 2020. This increase in provision is due to a benefit in 2020 that was associated with a provision in the CARES Act that allowed U.S. net operating losses incurred in tax years 2018, 2019, and 2020 to be carried back to the preceding five years and generate a tax refund for 2020. Under prior guidance, these net operating losses could only be carried forward.

CORPORATE ACTIVITIES

The following table sets forth our corporate charges for the periods indicated:

		Three Months Ended March 31,
		2021		2020
	(in thousands)
Operating costs
Selling, general and administrative		$	3,622	$	3,137
Operating loss		(3,622)		(3,137)
Interest expense		1,735		2,739
Loss (gain) associated with derivative instruments		(3,076)		2,873
Foreign currency transaction loss (gain)		(194)		(12)
Other income, net		—		(3)
Net loss		$	(2,087)	$	(8,734)

Three months ended March 31, 2021 compared with three months ended March 31, 2020

Costs associated with our corporate activities decreased $6.6 million to $2.1 million for the three months ended March 31, 2021 as compared with $8.7 million for the same period in 2020.

Our corporate selling, general and administrative expenses increased $0.5 million to $3.6 million for the three months ended March 31, 2021 as compared with $3.1 million for the three months ended March 31, 2020. The increase is primarily due to a change in the allocation of certain selling, general and administrative expenses from the Terminalling services and Fleet services segments to corporate activities that are not directly related to operating our Terminalling services and Fleet services segments that began in the first quarter of 2021. As such, there is a corresponding decrease in both the Terminalling services and Fleet services segments selling, general and administrative costs during the first quarter of 2021, as discussed above. Partially offsetting the increased corporate selling, general and administrative costs allocations was a decrease in audit fees incurred in the first quarter of 2021 as compared to the first quarter of 2020. Refer to Part I. Item 1. Financial Statements, Note 14. Segment reporting for further discussion on the change in segment cost allocation.

Our costs for interest expense decreased $1.0 million to $1.7 million for the three months ended March 31, 2021, as compared with the same period in 2020, primarily due to a decrease in interest rates we were charged under our Credit Agreement during the three months ended March 31, 2021 coupled with a lower weighted average balance of debt outstanding, as compared to the same period in 2020. In addition, we recognized a non-cash gain of $3.1 million on our interest rate derivatives for the three months ended March 31, 2021, as compared to a non-cash loss of $2.9 million for the same period in 2020.

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LIQUIDITY AND CAPITAL RESOURCES

Our principal liquidity requirements include:

•financing current operations;

•servicing our debt;

•funding capital expenditures, including potential acquisitions and the costs to construct new assets; and

•making distributions to our unitholders.

We have historically financed our operations with cash generated from our operating activities, borrowings under our Revolving Credit Facility and loans from our sponsor.

Liquidity Sources

We expect our ongoing sources of liquidity to include borrowings under our senior secured credit agreement, issuances of debt securities and additional partnership interests as well as cash generated from our operating activities. We believe that cash generated from these sources will be sufficient to meet our ongoing working capital and capital expenditure requirements and to make quarterly cash distributions at current levels for the next 12 months following the filing of this Report.

For information regarding our Credit Agreement, please see Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations — Liquidity and Capital Resources — Credit Agreement in our Annual Report on Form 10-K for the fiscal year ended December 31, 2020 and Part I. Item 1. Financial Statements, Note 9. Debt of this Quarterly Report.

The following table presents our available liquidity as of the dates indicated:

	March 31, 2021		December 31, 2020
	(in millions)
Cash and cash equivalents (1)	$	3.1	$	3.0
Aggregate borrowing capacity under Credit Agreement	385.0		385.0
Less: Revolving Credit Facility amounts outstanding	189.0		197.0
Available liquidity based on Credit Agreement capacity	$	199.1	$	191.0
Available liquidity based on Credit Agreement covenants (2)	$	74.5	$	56.2

(1)    Excludes amounts that are restricted pursuant to our collaborative agreement with Gibson.

(2)    Pursuant to the terms of our Credit Agreement, our borrowing capacity is limited to 4.5 times our trailing 12-month consolidated EBITDA, which equates to $71.4 million and $53.2 million of borrowing capacity available at March 31, 2021 and December 31, 2020, respectively.

Energy Capital Partners must approve any additional issuances of equity by us, and such determinations may be made free of any duty to us or our unitholders. Members of our general partner’s board of directors appointed by Energy Capital Partners must also approve the incurrence by us of additional indebtedness or refinancing outside of our existing indebtedness that is not in the ordinary course of business.

42

Cash Flows

The following table and discussion summarize the cash flows associated with our operating, investing and financing activities for the periods indicated:

	Three Months Ended March 31,
	2021		2020
	(in thousands)
Net cash provided by (used in):
Operating activities	$	12,645	$	11,717
Investing activities	(483)		(147)
Financing activities	(12,040)		(8,443)
Effect of exchange rates on cash	(95)		(989)
Net change in cash, cash equivalents and restricted cash	$	27	$	2,138

Operating Activities

Net cash provided by operating activities increased $0.9 million to $12.6 million for the three months ended March 31, 2021, as compared with $11.7 million for the three months ended March 31, 2020. The increase in net cash provided by operating activities is primarily attributable to the changes in cash flow derived from our operating results as discussed above in Results of Operations. While our net income for the quarter ended March 31, 2021 was $41.1 million more than our net loss for the same period in 2020, the net loss from 2020 included a significant amount of non-cash expenses that increase our net loss but did not decrease cash flow, such as our goodwill impairment loss recognized in 2020 and the loss associated with derivative instruments in 2020 as compared to the derivative gain we recognized in 2021. The net change in net cash provided by operating activities was also impacted by the timing of receipts and payments on accounts receivable, accounts payable and deferred revenue balances.

Investing Activities

Net cash used in investing activities increased to $0.5 million for the three months ended March 31, 2021 compared to $0.1 million for the three months ended March 31, 2020 primarily due to permitting costs incurred in the first quarter of 2021 associated with potential expansion opportunities at one of our terminals.

Financing Activities

Net cash used in financing activities increased to $12.0 million for the three months ended March 31, 2021 from $8.4 million for the three months ended March 31, 2020. Our net payments on our long-term debt during the three months ended March 31, 2021 were $12.0 million higher than the net borrowings during the three months ended March 31, 2020, partially offset with a decrease in cash paid for distributions during the three months ended March 31, 2021, as compared to the same period in 2020.

Cash Requirements

Our primary requirements for cash are: (1) financing current operations, (2) servicing our debt, (3) funding capital expenditures, including potential acquisitions and the costs to construct new assets, and (4) making distributions to our unitholders.

Capital Requirements

Our historical capital expenditures have primarily consisted of the costs to construct and acquire energy-related logistics assets. Our operations are expected to require investments to expand, upgrade or enhance existing facilities and to meet environmental and operational regulations. We also occasionally invest in our assets to expand their capacity or capability, such as the pipeline connection from our Casper Terminal to the Platte Terminal. We

43

may incur unanticipated costs in connection with any expansion projects, which costs could be material or be incurred in periods after the project is completed.

We expect to fund future capital expenditures from cash on our balance sheet, cash flow generated from our operating activities, borrowings under our Credit Agreement and the issuance of additional partnership interests or long-term debt.

Our partnership agreement requires that we categorize our capital expenditures as either expansion capital expenditures, maintenance capital expenditures, or investment capital expenditures. Although we have not experienced significant maintenance capital expenditures in prior years, as the age and usage of our assets increase, we expect that costs we incur to maintain them in compliance with sound business practice, our contractual relationships and applicable regulatory requirements will likely increase. Some of these costs will be characterized as maintenance capital expenditures. We incurred $0.2 million for maintenance capital expenditures during the three months ended March 31, 2021. Our total expansion capital expenditures for the three months ended March 31, 2021 were $0.3 million.

Debt Service

We anticipate reducing our outstanding indebtedness to the extent we generate cash flows in excess of our operating, investing and distribution needs. During the three months ended March 31, 2021, we received no proceeds from borrowings on our Revolving Credit Facility and made repayments of $8.0 million on our Revolving Credit Facility from cash flow in excess of our operating and investing needs. Subsequent to March 31, 2021 and as of May 3, 2021, we have made additional repayments of $3.0 million of the outstanding balance of our Revolving Credit Facility. As of May 3, 2021, we had amounts outstanding of $186.0 million under the Revolving Credit Facility and $199.0 million available for borrowings under the Revolving Credit Facility based on capacity that is subject to certain covenants. Refer to Part I. Item 1. Financial Statements, Note 9. Debt of this Quarterly Report for more information.

Distributions

Our partnership agreement does not require us to pay cash distributions on a quarterly or other basis, and we do not have a legal obligation to distribute any particular amount per common unit.

For the quarter ended March 31, 2021, the board of directors of our general partner determined that we had sufficient available cash after the establishment of cash reserves and the payment of our expenses to distribute $0.1135 per unit on all of our units. Our current quarterly distribution of $0.1135 per unit equates to $3.1 million per quarter, or $12.6 million per year, based on the number of common and general partner units outstanding as of May 5, 2021. This distribution represents an increase of 2.3% from the distribution with respect to the fourth quarter of 2020 and is the result of an improved outlook for our business and enhanced liquidity position, primarily resulting from net repayments totaling $35 million that reduced the outstanding balance on our Revolving Credit Facility since the end of the first quarter of 2020. Given the uncertainty in the energy industry that existed during 2020, the board of directors made a proactive decision to strengthen our financial position by reducing our quarterly distribution in 2020 from previous levels and redeploying certain free cash flow to de-lever. During the first quarter of 2021, we made a net repayment of $8.0 million of the outstanding balance of our Revolving Credit Facility. Subsequent to March 31, 2021 and as of May 3, 2021, we have made additional repayments of $3.0 million of the outstanding balance of our Revolving Credit Facility.

The board of directors of our general partner may change our distribution policy or suspend distributions at any time and from time to time. Additionally, members of our general partner’s board of directors appointed by Energy Capital Partners, must approve any distributions made by us.

44

Other Items Affecting Liquidity

Credit Risk

Our exposure to credit risk may be affected by the concentration of our customers within the energy industry, as well as changes in economic or other conditions. Our customers’ businesses react differently to changing conditions. We believe that our credit-review procedures, customer deposits and collection procedures have adequately provided for amounts that may become uncollectible in the future.

Foreign Currency Exchange Risk

We currently derive a significant portion of our cash flow from our Canadian operations, particularly our Hardisty terminal. As a result, portions of our cash and cash equivalents are denominated in Canadian dollars and are held by foreign subsidiaries, which amounts are subject to fluctuations resulting from changes in the exchange rate between the U.S. dollar and the Canadian dollar. We employ derivative financial instruments to minimize our exposure to the effect of foreign currency fluctuations, as we deem necessary based upon anticipated economic conditions.

SUBSEQUENT EVENTS

Refer to Note 19. Subsequent events of our consolidated financial statements included in Part I — Financial Information, Item 1. Financial Statements of this Report for a discussion regarding subsequent events.

Item 3. Quantitative and Qualitative Disclosures about Market Risk.

As a smaller reporting company, we are not required to provide the information required by this Item.

Item 4.    Controls and Procedures.

DISCLOSURE CONTROLS AND PROCEDURES

As required by Rule 13a-15(b) of the Securities Exchange Act of 1934, as amended, or the Exchange Act, we have evaluated, under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of March 31, 2021. Our disclosure controls and procedures are designed to provide reasonable assurance that the information required to be disclosed by us in reports that we file or submit under the Exchange Act is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate, to allow for timely decisions regarding required disclosure and to ensure information is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the SEC. Based upon that evaluation, our principal executive officer and principal financial officer concluded that our disclosure controls and procedures were effective as of March 31, 2021, at the reasonable assurance level.

CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING

We did not make any changes in our internal control over financial reporting during the three months ended March 31, 2021 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

45

PART II — OTHER INFORMATION

Item 1. Legal Proceedings

Due to the nature of our business, we are, from time to time, involved in routine litigation or subject to disputes or claims related to our business activities. We do not believe that we are currently a party to any litigation that will have a material adverse impact on our financial condition, results of operations or statements of cash flows. We are not aware of any material legal or governmental proceedings against us, or any proceedings known to be contemplated by governmental authorities.

Item 1A. Risk Factors

We are subject to various risks and uncertainties in the ordinary course of our business. Risk factors relating to us are set forth under “Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2020. We may be subject to additional risks and uncertainties that we currently consider immaterial or that are unknown to us but may have a material impact on our business, financial condition and results of operations.

Item 6. Exhibits

The following “Index of Exhibits” is hereby incorporated into this Item.

46

	Index of Exhibits
Exhibit Number	Description
3.1	Certificate of Limited Partnership of USD Partners LP (incorporated by reference herein to Exhibit 3.1 to the Registration Statement on Form S-1 (File No. 333-198500) filed on August 29, 2014, as amended).
3.2	Second Amended and Restated Agreement of Limited Partnership of USD Partners LP dated October 15, 2014, by and between USD Partners GP LLC and USD Group LLC (incorporated by reference herein to Exhibit 3.1 to the Current Report on Form 8-K (File No. 001-36674) filed on October 21, 2014).
31.1*	Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2*	Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1**	Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2**	Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS*	Inline XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document
101.SCH*	Inline XBRL Schema Document
101.CAL*	Inline XBRL Calculation Linkbase Document
101.LAB*	Inline XBRL Label Linkbase Document
101.PRE*	Inline XBRL Presentation Linkbase Document
101.DEF*	Inline XBRL Definition Linkbase Document
104*	The cover page of the USD Partners LP Quarterly Report on Form 10-Q for the quarter ended March 31, 2021, formatted in Inline XBRL (included within the Exhibit 101 attachments)

*     Filed herewith.

**     Furnished herewith.

47

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this Report to be signed on its behalf by the undersigned thereunto duly authorized.

		USD PARTNERS LP (Registrant)
		By:	USD Partners GP LLC, its General Partner
Date:	May 6, 2021	By:	/s/ Dan Borgen
			Dan Borgen Chief Executive Officer and President (Principal Executive Officer)
Date:	May 6, 2021	By:	/s/ Adam Altsuler
			Adam Altsuler Senior Vice President and Chief Financial Officer (Principal Financial Officer)

48

EX-31.1

Exhibit 31.1

Certification Pursuant to

Rules 13a-14 and 15d-14 Under the Securities Exchange Act of 1934

I, Dan Borgen, certify that:

1.I have reviewed this quarterly report on Form 10-Q (this “report”) of USD Partners LP (the “registrant”);

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d -15(f)) for the registrant and have:

(a)     Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)     Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)    Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)     Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:	May 6, 2021	/s/ Dan Borgen
		Dan Borgen
		Chief Executive Officer and President (Principal Executive Officer)

EX-31.2

Exhibit 31.2

Certification Pursuant to

Rules 13a-14 and 15d-14 Under the Securities Exchange Act of 1934

I, Adam Altsuler, certify that:

1.I have reviewed this quarterly report on Form 10-Q (this “report”) of USD Partners LP (the “registrant”);

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d -15(f)) for the registrant and have:

(a)     Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)     Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)    Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)     Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:	May 6, 2021	/s/ Adam Altsuler
		Adam Altsuler
		Senior Vice President and Chief Financial Officer (Principal Financial Officer)

EX-32.1

Exhibit 32.1

Certification Pursuant to

Section 906 of the Sarbanes-Oxley Act of 2002

(Subsections (a) and (b) of Section 1350, Chapter 63 of Title 18, United States Code)

Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (Subsections (a) and (b) of Section 1350, Chapter 63 of Title 18, United States Code), I, Dan Borgen, Chief Executive Officer and President of USD Partners GP LLC, as general partner of USD Partners LP (the “Partnership”), hereby certify, to the best of my knowledge, that:

(1)The Partnership’s Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2021 (the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

(2)The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Partnership.

Date:	May 6, 2021	/s/ Dan Borgen
		Dan Borgen
		Chief Executive Officer and President (Principal Executive Officer)

EX-32.2

Exhibit 32.2

Certification Pursuant to

Section 906 of the Sarbanes-Oxley Act of 2002

(Subsections (a) and (b) of Section 1350, Chapter 63 of Title 18, United States Code)

Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (Subsections (a) and (b) of Section 1350, Chapter 63 of Title 18, United States Code), I, Adam Altsuler, Chief Financial Officer of USD Partners GP LLC, as general partner of USD Partners LP (the “Partnership”), hereby certify, to the best of my knowledge, that:

(1)The Partnership’s Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2021 (the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

(2)The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Partnership.

Date:	May 6, 2021	/s/ Adam Altsuler
		Adam Altsuler
		Senior Vice President and Chief Financial Officer (Principal Financial Officer)

XML

Cover Page - shares	3 Months Ended
	Mar. 31, 2021	May 03, 2021
Document Information [Line Items]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Mar. 31, 2021
Document Transition Report	false
Entity File Number	001-36674
Entity Registrant Name	USD PARTNERS LP
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	30-0831007
Entity Address, Address Line One	811 Main Street
Entity Address, Address Line Two	Suite 2800
Entity Address, City or Town	Houston
Entity Address, State or Province	TX
Entity Address, Postal Zip Code	77002
City Area Code	281
Local Phone Number	291-0510
Title of 12(b) Security	Common Units Representing Limited Partner Interests
Trading Symbol	USDP
Security Exchange Name	NYSE
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Central Index Key	0001610682
Document Fiscal Year Focus	2021
Current Fiscal Year End Date	--12-31
Document Fiscal Period Focus	Q1
Amendment Flag	false
Entity Filer Category	Non-accelerated Filer
Common units
Document Information [Line Items]
Entity Shares Outstanding		27,224,441
General partner
Document Information [Line Items]
Entity Shares Outstanding		461,136

XML

CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Revenues
Total revenues	$ 30,599	$ 30,206
Operating costs
Operating and maintenance	2,832	3,081
Operating and maintenance — related party	4,922	5,108
Selling, general and administrative	3,056	3,180
Selling, general and administrative — related party	4,733	5,173
Goodwill impairment loss	0	33,589
Depreciation and amortization	5,471	5,422
Total operating costs	24,469	59,706
Operating income (loss)	6,130	(29,500)
Interest expense	1,735	2,739
Loss (gain) associated with derivative instruments	(3,076)	2,873
Foreign currency transaction gain	(61)	(92)
Other income, net	(20)	(732)
Income (loss) before income taxes	7,552	(34,288)
Provision for (benefit from) income taxes	224	(507)
Net income (loss)	7,328	(33,781)
Net income (loss) attributable to limited partner interests	$ 7,204	$ (33,210)
Weighted average units outstanding (in shares)	27,491	27,127
Common units
Operating costs
Net income (loss) per unit (basic and diluted) (USD per share)	$ 0.27	$ (1.30)
Weighted average units outstanding (in shares)	27,030	25,516
Subordinated units
Operating costs
Net income (loss) per unit (basic and diluted) (USD per share)	$ 0	$ (0.01)
Weighted average units outstanding (in shares)	0	1,150
Related party
Revenues
Revenues	$ 2,314	$ 5,299
Operating costs
Operating and maintenance — related party	2,090	2,027
Selling, general and administrative — related party	1,677	1,993
Terminalling services
Revenues
Revenues	28,105	24,235
Terminalling services | Related party
Revenues
Revenues	1,103	4,088
Fleet leases | Related party
Revenues
Revenues	984	984
Fleet services
Revenues
Revenues	24	50
Fleet services | Related party
Revenues
Revenues	227	227
Freight and other reimbursables
Revenues
Revenues	156	622
Operating costs
Operating costs	156	622
Subcontracted rail services
Operating costs
Operating costs	3,141	3,445
Pipeline fees
Operating costs
Operating costs	$ 6,046	$ 6,347

XML

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Statement of Comprehensive Income [Abstract]
Net income (loss)	$ 7,328	$ (33,781)
Other comprehensive income (loss) — foreign currency translation	375	(4,522)
Comprehensive income (loss)	$ 7,703	$ (38,303)

XML

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Cash flows from operating activities:
Net income (loss)	$ 7,328	$ (33,781)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation and amortization	5,471	5,422
Loss (gain) associated with derivative instruments	(3,076)	2,873
Settlement of derivative contracts	(264)	(6)
Unit based compensation expense	1,512	1,635
Deferred income taxes	(18)	(352)
Amortization of deferred financing costs	207	207
Goodwill impairment loss	0	33,589
Changes in operating assets and liabilities:
Accounts receivable	(402)	608
Accounts receivable — related party	(84)	(941)
Prepaid expenses and other assets	884	(1,220)
Other assets — related party	(394)	(250)
Accounts payable and accrued expenses	290	407
Accounts payable and accrued expenses — related party	(25)	491
Deferred revenue and other liabilities	1,212	3,035
Other liabilities — related party	4	0
Net cash provided by operating activities	12,645	11,717
Cash flows from investing activities:
Additions of property and equipment	(483)	(147)
Net cash used in investing activities	(483)	(147)
Cash flows from financing activities:
Distributions	(3,183)	(10,655)
Vested phantom units used for payment of participant taxes	(857)	(1,788)
Proceeds from long-term debt	0	10,000
Repayments of long-term debt	(8,000)	(6,000)
Net cash used in financing activities	(12,040)	(8,443)
Effect of exchange rates on cash	(95)	(989)
Net change in cash, cash equivalents and restricted cash	27	2,138
Cash, cash equivalents and restricted cash — beginning of period	10,994	10,684
Cash, cash equivalents and restricted cash — end of period	$ 11,021	$ 12,822

XML

CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Mar. 31, 2021	Dec. 31, 2020
Current assets
Cash and cash equivalents	$ 3,066	$ 3,040
Restricted cash	7,955	7,954
Accounts receivable, net	4,467	4,049
Accounts receivable — related party	2,569	2,460
Prepaid expenses	1,788	1,959
Other current assets	1,035	1,777
Other current assets — related party	0	15
Total current assets	20,880	21,254
Property and equipment, net	138,731	139,841
Intangible assets, net	58,341	61,492
Operating lease right-of-use assets	8,320	9,630
Other non-current assets	4,320	3,625
Other non-current assets — related party	2,138	1,706
Total assets	232,730	237,548
Current liabilities
Accounts payable and accrued expenses	2,303	1,865
Accounts payable and accrued expenses — related party	359	383
Deferred revenue	6,968	6,367
Deferred revenue — related party	410	410
Operating lease liabilities, current	5,153	5,291
Other current liabilities	4,407	4,222
Total current liabilities	19,600	18,538
Long-term debt, net	187,688	195,480
Operating lease liabilities, non-current	3,155	4,392
Other non-current liabilities	10,927	12,870
Other non-current liabilities — related party	4	0
Total liabilities	221,374	231,280
Commitments and contingencies
Partners’ capital
General partner units (461,136 outstanding at March 31, 2021 and December 31, 2020)	1,962	1,892
Accumulated other comprehensive income	922	547
Total partners’ capital	11,356	6,268
Total liabilities and partners’ capital	232,730	237,548
Common units
Partners’ capital
Common units (27,224,441 and 26,844,715 outstanding at March 31, 2021 and December 31, 2020, respectively)	$ 8,472	$ 3,829

XML

CONSOLIDATED BALANCE SHEETS (Parenthetical) - shares	Mar. 31, 2021	Dec. 31, 2020
General partners' units outstanding (in shares)	461,136	461,136
Common units
Limited partners' units outstanding (in shares)	27,224,441	26,844,715

XML

CONSOLIDATED STATEMENTS OF PARTNERS CAPITAL - USD ($) $ in Thousands	Total	Accumulated other comprehensive income (loss)	Limited Partner Common units	Limited Partner Subordinated units	General partner
Beginning balance (in shares) at Dec. 31, 2019			24,411,892	2,092,709	461,136
Beginning balance at Dec. 31, 2019		$ (127)	$ 61,013	$ (22,597)	$ 2,767
Increase (Decrease) in Partners' Capital [Roll Forward]
Conversion of units (in units) (in shares)			2,092,709	(2,092,709)
Conversion of units			$ (23,423)	$ 23,423
Common units issued for vested phantom units (in units)			339,073
Common units issued for vested phantom units			$ (1,788)
Net income (loss)	$ (33,781)		(33,195)	(15)	(571)
Unit based compensation expense			1,571		1
Distributions			$ (9,464)	$ (811)	$ (380)
Cumulative translation adjustment	(4,522)	(4,522)
Ending balance (in shares) at Mar. 31, 2020			26,843,674	0	461,136
Ending balance at Mar. 31, 2020	(8,118)	(4,649)	$ (5,286)	$ 0	$ 1,817
Beginning balance (in shares) at Dec. 31, 2020			26,844,715	0	461,136
Beginning balance at Dec. 31, 2020	6,268	547	$ 3,829	$ 0	$ 1,892
Increase (Decrease) in Partners' Capital [Roll Forward]
Conversion of units (in units) (in shares)			0	0
Conversion of units			$ 0	$ 0
Common units issued for vested phantom units (in units)			379,726
Common units issued for vested phantom units			$ (857)
Net income (loss)	7,328		7,204	0	124
Unit based compensation expense			1,425		0
Distributions			$ (3,129)	$ 0	$ (54)
Cumulative translation adjustment	375	375
Ending balance (in shares) at Mar. 31, 2021			27,224,441	0	461,136
Ending balance at Mar. 31, 2021	$ 11,356	$ 922	$ 8,472	$ 0	$ 1,962

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ORGANIZATION AND BASIS OF PRESENTATION

3 Months Ended

Mar. 31, 2021

Organization, Consolidation and Presentation of Financial Statements [Abstract]

ORGANIZATION AND BASIS OF PRESENTATION

ORGANIZATION AND BASIS OF PRESENTATION

USD Partners LP and its consolidated subsidiaries, collectively referred to herein as we, us, our, the Partnership and USDP, is a fee-based, growth-oriented master limited partnership formed in 2014 by US Development Group, LLC, or USD, through its wholly-owned subsidiary, USD Group LLC, or USDG. We were formed to acquire, develop and operate midstream infrastructure and complementary logistics solutions for crude oil, biofuels and other energy-related products. We generate substantially all of our operating cash flows from multi-year, take-or-pay contracts with primarily investment grade customers, including major integrated oil companies, refiners and marketers. Our network of crude oil terminals facilitate the transportation of heavy crude oil from Western Canada to key demand centers across North America. Our operations include railcar loading and unloading, storage and blending in onsite tanks, inbound and outbound pipeline connectivity, truck transloading, as well as other related logistics services. We also provide our customers with leased railcars and fleet services to facilitate the transportation of liquid hydrocarbons by rail. We do not generally take ownership of the products that we handle, nor do we receive any payments from our customers based on the value of such products. We may on occasion enter into buy-sell arrangements in which we take temporary title to commodities while in our terminals. We expect such arrangements to be at fixed prices where we do not take commodity price exposure.

A substantial amount of the operating cash flows related to the terminalling services that we provide are generated from take-or-pay contracts with minimum monthly commitment fees and, as a result, are not directly related to actual throughput volumes at our crude oil terminals. Throughput volumes at our terminals are primarily influenced by the difference in price between Western Canadian Select, or WCS, and other grades of crude oil, commonly referred to as spreads, rather than absolute price levels. WCS spreads are influenced by several market factors, including the availability of supplies relative to the level of demand from refiners and other end users, the price and availability of alternative grades of crude oil, the availability of takeaway capacity, as well as transportation costs from supply areas to demand centers.

Basis of Presentation

Our accompanying unaudited interim consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States, or GAAP, for interim consolidated financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not include all the information and disclosures required by GAAP for complete consolidated financial statements. In the opinion of our management, they contain all adjustments, consisting only of normal recurring adjustments, which our management considers necessary to present fairly our financial position as of March 31, 2021, our results of operations for the three months ended March 31, 2021 and 2020, and our cash flows for the three months ended March 31, 2021 and 2020. We derived our consolidated balance sheet as of December 31, 2020 from the audited consolidated financial statements included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2020. Our results of operations for the three months ended March 31, 2021 and 2020 should not be taken as indicative of the results to be expected for the full year due to fluctuations in the supply of and demand for crude oil and biofuels, timing and completion of acquisitions, if any, changes in the fair market value of our derivative instruments and the impact of fluctuations in foreign currency exchange rates. These unaudited interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements and accompanying notes thereto presented in our Annual Report on Form 10-K for the fiscal year ended December 31, 2020.

COVID-19 Update

During 2020, the COVID-19 pandemic adversely affected the global economy, disrupted global supply chains and created significant volatility in the financial markets. As a result, there was significant reduction in demand for, and fluctuations in the prices of crude oil, natural gas and natural gas liquids. This significantly impacted Canadian producers, which in turn resulted in lower crude oil prices and led to lower throughput volume through our facilities.

However, the decline in throughput volumes at our facilities did not have a material impact on our results of operations or cash flows during 2020, as a substantial amount of our terminalling services operating cash flows are generated from take-or-pay contracts with minimum monthly commitment fees with mainly investment grade customers. There still remains significant uncertainty given the unprecedented and evolving nature of the COVID-19 pandemic and the state of the commodity markets. As such, we will continue to actively monitor their impact on our operations and financial condition.

Foreign Currency Translation

We conduct a substantial portion of our operations in Canada, which we account for in the local currency, the Canadian dollar. We translate most Canadian dollar denominated balance sheet accounts into our reporting currency, the U.S. dollar, at the end of period exchange rate, while most accounts in our statement of operations accounts are translated into our reporting currency based on the average exchange rate for each monthly period. Fluctuations in the exchange rates between the Canadian dollar and the U.S. dollar can create variability in the amounts we translate and report in U.S. dollars.

Within these consolidated financial statements, we denote amounts denominated in Canadian dollars with “C$” immediately prior to the stated amount.

US Development Group, LLC

USD and its affiliates are engaged in designing, developing, owning and managing large-scale multi-modal logistics centers and energy-related infrastructure across North America. USD is the indirect owner of our general partner through its direct ownership of USDG and is currently owned by Energy Capital Partners, Goldman Sachs and certain of USD’s management team.

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RECENT ACCOUNTING PRONOUNCEMENTS

3 Months Ended

Mar. 31, 2021

Accounting Policies [Abstract]

RECENT ACCOUNTING PRONOUNCEMENTS

RECENT ACCOUNTING PRONOUNCEMENTS

Recently Adopted Accounting Pronouncements

Income Taxes (ASU 2019-12)

In December 2019, the Financial Accounting Standards Board, or FASB, issued Accounting Standards Update No. 2019-12, or ASU 2019-12, which amends the FASB Accounting Standards Codification, or ASC, Topic 740, by removing certain exceptions related to the approach for intraperiod tax allocation, the methodology for calculating income taxes in an interim period and the recognition of deferred tax liabilities for outside basis differences. It also simplifies aspects of the accounting for franchise taxes and enacted changes in tax laws or rates and clarifies the accounting for transactions that result in a step-up in the tax basis of goodwill. In addition, under the provisions of ASU 2019-12, single-member limited liability companies and similar disregarded entities that are not subject to income tax are not required to recognize an allocation of consolidated income tax expense in their separate financial statements, but they could elect to do so. The pronouncement is effective for fiscal years beginning after December 15, 2020, or for any interim periods within those fiscal years, with early adoption permitted.

We adopted the provisions of ASU 2019-12 on January 1, 2021. Our adoption of this standard did not have an impact on our financial statements.

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NET INCOME (LOSS) PER LIMITED PARTNER INTEREST

3 Months Ended

Mar. 31, 2021

Earnings Per Share [Abstract]

NET INCOME (LOSS) PER LIMITED PARTNER INTEREST

NET INCOME (LOSS) PER LIMITED PARTNER INTEREST We allocate our net income or loss among our general partner and limited partners using the two-class method in accordance with applicable authoritative accounting guidance. Under the two-class method, we allocate our net income or loss and any net income or loss in excess of distributions to our limited partners, our general partner and the holder of the incentive distribution rights, or IDRs, according to the distribution formula for available cash as set forth in our partnership agreement. We allocate any distributions in excess of earnings for the period to our limited partners and general partner based on their respective proportionate ownership interests in us, as set forth in our partnership agreement after taking into account distributions to be paid with respect to the IDRs. The formula for distributing available cash as set forth in our partnership agreement is as follows:

Distribution Targets	Portion of Quarterly Distribution Per Unit	Percentage Distributed to Limited Partners	Percentage Distributed to General Partner (including IDRs) (1)
Minimum Quarterly Distribution	Up to $0.2875	98%	2%
First Target Distribution	> $0.2875 to $0.330625	98%	2%
Second Target Distribution	> $0.330625 to $0.359375	85%	15%
Third Target Distribution	> $0.359375 to $0.431250	75%	25%
Thereafter	Amounts above $0.431250	50%	50%

(1)Calculated as if our general partner holds the original 2% general partner interest in us, which is currently 1.7%.

We determined basic and diluted net income (loss) per limited partner unit as set forth in the following tables:

	For the Three Months Ended March 31, 2021
	Common Units		Subordinated Units (7)		General Partner Units		Total
	(in thousands, except per unit amounts)
Net income attributable to general and limited partner interests in USD Partners LP (1)	$	7,204	$	—	$	124	$	7,328
Less: Distributable earnings (2)	3,248		—		55		3,303
Excess net income	$	3,956	$	—	$	69	$	4,025
Weighted average units outstanding (3)	27,030		—		461		27,491
Distributable earnings per unit (4)	$	0.12	$	—
Underdistributed earnings per unit (5)	0.15		—
Net income per limited partner unit (basic and diluted) (6)	$	0.27	$	—

(1)Represents net income allocated to each class of units based on the actual ownership of the Partnership during the period. There were no amounts attributed to the general partner for its incentive distribution rights.

(2)Represents the per unit distribution payable for the period based upon the quarterly distribution amounts of $0.1135 per unit or $0.454 on an annualized basis. Amounts presented for each class of units include a proportionate amount of the $161 thousand distributable to holders of the Equity classified Phantom Units pursuant to the distribution equivalent rights granted under the USD Partners LP 2014 Amended and Restated Long-Term Incentive Plan.

(3)Represents the weighted average units outstanding for the period.

(4)Represents the total distributable earnings divided by the weighted average number of units outstanding for the period.

(5)Represents the additional amount per unit necessary to distribute the excess net income for the period among our limited partners and our general partners according to the distribution formula for available cash as set forth in our partnership agreement.

(6)Our computation of net income per limited partner unit excludes the effects of 1,418,517 equity-classified phantom unit awards outstanding as they were anti-dilutive for the period presented.

(7)In February 2020, the final tranche of 2,092,709 subordinated units were converted into common units and therefore there were no subordinated units outstanding during 2021. Refer to Note 16. Partners Capital for more information.

	For the Three Months Ended March 31, 2020
	Common Units		Subordinated Units (7)		General Partner Units		Total
	(in thousands, except per unit amounts)
Net loss attributable to general and limited partner interests in USD Partners LP (1)	$	(33,195)	$	(15)	$	(571)	$	(33,781)
Less: Distributable earnings (2)	3,129		—		54		3,183
Distributions in excess of earnings	$	(36,324)	$	(15)	$	(625)	$	(36,964)
Weighted average units outstanding (3)	25,516		1,150		461		27,127
Distributable earnings per unit (4)	$	0.12	$	—
Overdistributed earnings per unit (5)	(1.42)		(0.01)
Net loss per limited partner unit (basic and diluted)(6)	$	(1.30)	$	(0.01)

(1)Represents net loss allocated to each class of units based on the actual ownership of the Partnership during the period. There were no amounts attributed to the general partner for its incentive distribution rights.

(2)Represents the per unit distributions paid for the period based upon the quarterly distribution of $0.111 per unit, or $0.444 per unit on an annualized basis. Amounts presented for each class of units include a proportionate amount of the $152 thousand distributed to holders of the Equity-classified Phantom Units pursuant to the distribution equivalent rights granted under the USD Partners LP 2014 Amended and Restated Long-Term Incentive Plan.

(3)Represents the weighted average units outstanding for the period.

(4)Represents the total distributable earnings divided by the weighted average number of units outstanding for the period.

(5)Represents the distributions in excess of earnings divided by the weighted average number of units outstanding for the period.

(6)Our computation of net loss per limited partner unit excludes the effects of 1,367,678 equity-classified phantom unit awards outstanding as they were anti-dilutive for the period presented.

(7)In February 2020, the final tranche of 2,092,709 subordinated units were converted into common units. Refer to Note 16. Partners Capital for more information.

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REVENUES

3 Months Ended

Mar. 31, 2021

Revenue from Contract with Customer [Abstract]

REVENUES

REVENUES

Disaggregated Revenues

We manage our business in two reportable segments: Terminalling services and Fleet services. Our segments offer different services and are managed accordingly. Our chief operating decision maker, or CODM, regularly reviews financial information about both segments in order to allocate resources and evaluate performance. As such, we have concluded that disaggregating revenue by reporting segments appropriately depicts how the nature, amount, timing, and uncertainty of revenue and cash flows are affected by economic factors. Refer to Note 14. Segment Reporting for our disaggregated revenues by segment. Additionally, the below tables summarize the geographic data for our revenues:

	Three Months Ended March 31, 2021
	U.S.		Canada		Total
	(in thousands)
Third party	$	7,638	$	20,647	$	28,285
Related party	$	2,314	$	—	$	2,314

	Three Months Ended March 31, 2020
	U.S.		Canada		Total
	(in thousands)
Third party	$	7,049	$	17,858	$	24,907
Related party	$	2,305	$	2,994	$	5,299

Remaining Performance Obligations

The transaction price allocated to the remaining performance obligations associated with our terminalling and fleet services agreements as of March 31, 2021 are as follows for the periods indicated:

	For the nine months ending December 31, 2021		2022		2023		2024		Thereafter		Total
	(in thousands)
Terminalling Services (1) (2) (3)	$	73,729	$	75,048	$	37,779	$	19,528	$	126,932	$	333,016
Fleet Services	682		1,195		—		—		—		1,877
Total	$	74,411	$	76,243	$	37,779	$	19,528	$	126,932	$	334,893

(1)A significant portion of our terminalling services agreements are denominated in Canadian dollars. We have converted the remaining performance obligations associated with these Canadian dollar-denominated contracts using the year-to-date average exchange rate of 0.7897 U.S. dollars for each Canadian dollar at March 31, 2021.

(2)Includes fixed monthly minimum commitment fees per contracts and excludes constrained estimates of variable consideration for rate-escalations associated with an index, such as the consumer price index, as well as any incremental revenue associated with volume activity above the minimum volumes set forth within the contracts. Also excludes estimated constrained variable consideration included in certain of our terminalling services agreements that is based on crude oil pricing index differentials.

(3)Assumes USD’s Diluent Recovery Unit project goes into service in the second half of 2021, which will result in certain terminalling services agreements of our Hardisty Terminal being automatically extended through mid-2031 and certain agreements at our Stroud Terminal having a termination right in June 2022.

We have applied the practical expedient that allows us to exclude disclosure of performance obligations that are part of a contract that has an expected duration of one year or less.

Contract Assets

Our contract assets represent cumulative revenue that has been recognized in advance of billing the customer due to tiered billing provisions. In such arrangements, revenue is recognized using a blended rate based on the billing tiers of the agreement, as the services are consistently provided throughout the duration of the contractual arrangement.

We had the following amounts outstanding associated with our contract assets on our consolidated balance sheets in the financial statement line items presented below in the following table for the indicated periods:

	March 31, 2021		December 31, 2020
	(in thousands)
Other current assets	$	897	$	1,622

Deferred Revenue

Our deferred revenue is a form of a contract liability and consists of amounts collected in advance from customers associated with their terminalling and fleet services agreements and deferred revenues associated with make-up rights, which will be recognized as revenue when earned pursuant to the terms of our contractual arrangements. We currently recognize substantially all of the amounts we receive for minimum volume commitments as revenue when collected, since breakage associated with these make-up rights is currently approximately 97% based on our expectations around usage of these options. Accordingly, we had $0.6 million deferred revenues at March 31, 2021 for estimated breakage associated with the make-up rights options we granted to our customers. There were no deferred revenues associated with make-up rights at December 31, 2020.

We also have deferred revenue that represents cumulative revenue that has been deferred due to tiered billing provisions. In such arrangements, revenue is recognized using a blended rate based on the billing tiers of the agreement, as the services are consistently provided throughout the duration of the contractual arrangement, which we included in “Other current liabilities” and “Other non-current liabilities” on our consolidated balance sheets.

The following table presents the amounts outstanding on our consolidated balance sheets and changes

associated with the balance of our deferred revenue for the three months ended March 31, 2021:

	December 31, 2020		Cash Additions for Customer Prepayments		Revenue Recognized		March 31, 2021
	(in thousands)
Deferred revenue (1)	$	6,367	$	6,968	$	(6,367)	$	6,968
Other current liabilities	$	—	$	704	$	—	$	704
Other non-current liabilities (2)	$	10,087	$	781	$	—	$	10,868

(1)    Includes deferred revenue of $0.6 million for estimated breakage associated with the make-up rights options we granted to our customers, as discussed above.

(2)    Includes cumulative revenue that has been deferred due to tiered billing provisions included in certain of our Canadian dollar-denominated contracts, as discussed above. As such, the change in “Other non-current liabilities” presented has been increased by $121 thousand due to the impact of the change in the end of period exchange rate between December 31, 2020 and March 31, 2021.

Deferred Revenue — Fleet Leases

Our deferred revenue also includes advance payments from customers of our Fleet services business, which will be recognized as Fleet leases revenue when earned pursuant to the terms of our contractual arrangements. We have included $0.4 million at March 31, 2021 and December 31, 2020, in “Deferred revenue — related party” on our consolidated balance sheets associated with customer prepayments for our fleet lease agreements. Refer to Note 7. Leases for additional discussion of our lease revenues.

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RESTRICTED CASH

3 Months Ended

Mar. 31, 2021

Cash and Cash Equivalents [Abstract]

RESTRICTED CASH

RESTRICTED CASH

We include in restricted cash amounts representing a cash account for which the use of funds is restricted by a facilities connection agreement among us and Gibson Energy Inc., or Gibson, that we entered into during 2014 in connection with the development of our Hardisty terminal. The collaborative arrangement is further discussed in Note 10. Collaborative Arrangement.

The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within our consolidated balance sheets to the amounts shown in our consolidated statements of cash flows for the specified periods:

	March 31,
	2021		2020
	(in thousands)
Cash and cash equivalents	$	3,066	$	4,622
Restricted Cash	7,955		8,200
Total cash, cash equivalents and restricted cash	$	11,021	$	12,822

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PROPERTY AND EQUIPMENT

3 Months Ended

Mar. 31, 2021

Property, Plant and Equipment [Abstract]

PROPERTY AND EQUIPMENT

PROPERTY AND EQUIPMENT

Our property and equipment is comprised of the following asset classifications as of the dates indicated:

	March 31, 2021		December 31, 2020		Estimated Depreciable Lives (Years)
	(in thousands)
Land	$	10,324	$	10,288	N/A
Trackage and facilities	128,189		127,401		10-30
Pipeline	32,735		32,735		20-30
Equipment	17,409		17,337		3-20
Furniture	67		67		5-10
Total property and equipment	188,724		187,828
Accumulated depreciation	(51,249)		(48,630)
Construction in progress (1)	1,256		643
Property and equipment, net	$	138,731	$	139,841

(1) The amounts classified as “Construction in progress” are excluded from amounts being depreciated. These amounts represent property that has not been placed into productive service as of the respective consolidated balance sheet date.

Depreciation expense associated with property and equipment totaled $2.3 million for the three months ended March 31, 2021 and 2020.

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LEASES

3 Months Ended

Mar. 31, 2021

Leases [Abstract]

LEASES

LEASES

We have noncancellable operating leases for railcars, buildings, storage tanks, offices, railroad tracks, and land.

	Three Months Ended March 31, 2021
Weighted-average discount rate	5.8	%
Weighted average remaining lease term in years	1.65

Our total lease cost consisted of the following items for the dates indicated:

		Three Months Ended March 31,
		2021		2020
	(in thousands)
Operating lease cost		$	1,479	$	1,486
Short term lease cost		44		45
Variable lease cost		18		9
Sublease income		(1,348)		(1,341)
Total		$	193	$	199

The maturity analysis below presents the undiscounted cash payments we expect to make each period for property that we lease from others under noncancellable operating leases as of March 31, 2021 (in thousands): 

2021	$	4,179
2022	4,520
2023	35
2024	2
Total lease payments	$	8,736
Less: imputed interest	(428)
Present value of lease liabilities	$	8,308

We serve as an intermediary to assist our customers with obtaining railcars. In connection with our leasing of railcars from third parties, we simultaneously enter into lease agreements with our customers for noncancellable terms that are designed to recover our costs associated with leasing the railcars plus a fee for providing this service. In addition to these leases, we also have lease income from storage tanks.

	Three Months Ended March 31,
	2021		2020
	(in thousands, except weighted average term)
Lease income (1)	$	2,185	$	2,186
Weighted average remaining lease term in years			1.58

(1)Lease income presented above includes lease income from related parties. Refer to Note 12. Transactions with Related Parties for additional discussion of lease income from related parties. Lease income associated with crude oil storage tanks we lease to customers of our terminals totaling $1.2 million for the three months ended March 31, 2021 and 2020, is included in “Terminalling services” revenues on our consolidated statements of operations.

The maturity analysis below presents the undiscounted future minimum lease payments we expect to receive from customers each period for property they lease from us under noncancellable operating leases as of March 31, 2021 (in thousands): 

2021	$	6,142
2022	5,367
Total	$	11,509

LEASES

LEASES

We have noncancellable operating leases for railcars, buildings, storage tanks, offices, railroad tracks, and land.

	Three Months Ended March 31, 2021
Weighted-average discount rate	5.8	%
Weighted average remaining lease term in years	1.65

Our total lease cost consisted of the following items for the dates indicated:

		Three Months Ended March 31,
		2021		2020
	(in thousands)
Operating lease cost		$	1,479	$	1,486
Short term lease cost		44		45
Variable lease cost		18		9
Sublease income		(1,348)		(1,341)
Total		$	193	$	199

The maturity analysis below presents the undiscounted cash payments we expect to make each period for property that we lease from others under noncancellable operating leases as of March 31, 2021 (in thousands): 

2021	$	4,179
2022	4,520
2023	35
2024	2
Total lease payments	$	8,736
Less: imputed interest	(428)
Present value of lease liabilities	$	8,308

We serve as an intermediary to assist our customers with obtaining railcars. In connection with our leasing of railcars from third parties, we simultaneously enter into lease agreements with our customers for noncancellable terms that are designed to recover our costs associated with leasing the railcars plus a fee for providing this service. In addition to these leases, we also have lease income from storage tanks.

	Three Months Ended March 31,
	2021		2020
	(in thousands, except weighted average term)
Lease income (1)	$	2,185	$	2,186
Weighted average remaining lease term in years			1.58

(1)Lease income presented above includes lease income from related parties. Refer to Note 12. Transactions with Related Parties for additional discussion of lease income from related parties. Lease income associated with crude oil storage tanks we lease to customers of our terminals totaling $1.2 million for the three months ended March 31, 2021 and 2020, is included in “Terminalling services” revenues on our consolidated statements of operations.

The maturity analysis below presents the undiscounted future minimum lease payments we expect to receive from customers each period for property they lease from us under noncancellable operating leases as of March 31, 2021 (in thousands): 

2021	$	6,142
2022	5,367
Total	$	11,509

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INTANGIBLE ASSETS

3 Months Ended

Mar. 31, 2021

Goodwill and Intangible Assets Disclosure [Abstract]

INTANGIBLE ASSETS

INTANGIBLE ASSETS

The composition, gross carrying amount and accumulated amortization of our identifiable intangible assets are as follows as of the dates indicated:

	March 31, 2021		December 31, 2020
	(in thousands)
Carrying amount:
Customer service agreements	$	125,960	$	125,960
Other	106		106
Total carrying amount	126,066		126,066
Accumulated amortization:
Customer service agreements	(67,669)		(64,520)
Other	(56)		(54)
Total accumulated amortization	(67,725)		(64,574)
Total intangible assets, net	$	58,341	$	61,492

Amortization expense associated with intangible assets totaled $3.2 million for the three months ended March 31, 2021 and 2020.

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DEBT

3 Months Ended

Mar. 31, 2021

Debt Disclosure [Abstract]

DEBT

DEBT

In November 2018, we amended and restated our senior secured credit agreement, which we originally established at the time of our initial public offering in October 2014. We refer to the amended and restated senior secured credit agreement executed in November 2018 as the Credit Agreement and the original senior secured credit agreement as the Previous Credit Agreement. Our Credit Agreement is a $385 million revolving credit facility (subject to limits set forth therein) with Citibank, N.A., as administrative agent, and a syndicate of lenders. Our Credit Agreement amends and restates in its entirety our Previous Credit Agreement.

Our Credit Agreement is a four year committed facility that initially matures on November 2, 2022. Our Credit Agreement provides us with the ability to request two one-year maturity date extensions, subject to the satisfaction of certain conditions, and allows us the option to increase the maximum amount of credit available up to a total facility size of $500 million, subject to receiving increased commitments from lenders and satisfaction of certain conditions.

Our Credit Agreement and any issuances of letters of credit are available for working capital, capital expenditures, general partnership purposes and continue the indebtedness outstanding under the Previous Credit Agreement. The Credit Agreement includes an aggregate $20 million sublimit for standby letters of credit and a $20 million sublimit for swingline loans. Obligations under the Credit Agreement are guaranteed by our restricted subsidiaries (as such term is defined therein) and are secured by a first priority lien on our assets and those of our restricted subsidiaries, other than certain excluded assets.

Our long-term debt balances included the following components as of the specified dates:

	March 31, 2021		December 31, 2020
	(in thousands)
Revolving Credit Facility	$	189,000	$	197,000
Less: Deferred financing costs, net	(1,312)		(1,520)
Total long-term debt, net	$	187,688	$	195,480

We determined the capacity available to us under the terms of our Credit Agreement was as follows as of the specified dates:

	March 31, 2021		December 31, 2020
	(in millions)
Aggregate borrowing capacity under Credit Agreement	$	385.0	$	385.0
Less: Revolving Credit Facility amounts outstanding	189.0		197.0
Available under the Credit Agreement based on capacity	$	196.0	$	188.0
Available under the Credit Agreement based on covenants (1)	$	71.4	$	53.2

(1)    Pursuant to the terms of our Credit Agreement, our borrowing capacity, currently, is limited to 4.5 times our trailing 12-month consolidated EBITDA, which equates to $71.4 million and $53.2 million of borrowing capacity available at March 31, 2021 and December 31, 2020, respectively.

The weighted average interest rate on our outstanding indebtedness was 2.62% and 2.66% at March 31, 2021 and December 31, 2020, respectively, without consideration to the effect of our derivative contracts. In addition to the interest we incur on our outstanding indebtedness, we pay commitment fees of 0.50% on unused commitments, which rate will vary based on our consolidated net leverage ratio, as defined in our Credit Agreement. At March 31, 2021, we were in compliance with the covenants set forth in our Credit Agreement.

Interest expense associated with our outstanding indebtedness was as follows for the specified periods:

		Three Months Ended March 31,
		2021		2020
	(in thousands)
Interest expense on the Credit Agreement		$	1,528	$	2,532
Amortization of deferred financing costs		207		207
Total interest expense		$	1,735	$	2,739

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COLLABORATIVE ARRANGEMENT	3 Months Ended
	Mar. 31, 2021
Organization, Consolidation and Presentation of Financial Statements [Abstract]
COLLABORATIVE ARRANGEMENT	COLLABORATIVE ARRANGEMENTWe entered into a facilities connection agreement in 2014 with Gibson under which Gibson developed, constructed and operates a pipeline and related facilities connected to our Hardisty terminal. Gibson’s storage terminal is the exclusive means by which our Hardisty Terminal receives crude oil. Subject to certain limited exceptions regarding manifest train facilities, our Hardisty Terminal is the exclusive means by which crude oil from Gibson’s Hardisty storage terminal may be transported by rail. We remit pipeline fees to Gibson for the transportation of crude oil to our Hardisty Terminal based on a predetermined formula. Pursuant to our arrangement with Gibson, we incurred pipeline fees of $6.0 million and $6.3 million for the three months ended March 31, 2021 and 2020, respectively, which are presented as “Pipeline fees” in our consolidated statements of operations. We have included a liability related to this agreement in “Other current liabilities” on our consolidated balance sheets of $1.7 million and $2.3 million at March 31, 2021 and December 31, 2020, respectively. Additionally, we have included an asset related to this agreement in “Other non-current assets” of $3.0 million and $2.9 million at March 31, 2021 and December 31, 2020, respectively, which we will recognize as expense concurrently with the recognition of the associated revenue at out Hardisty Terminal.

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NONCONSOLIDATED VARIABLE INTEREST ENTITIES

3 Months Ended

Mar. 31, 2021

Organization, Consolidation and Presentation of Financial Statements [Abstract]

NONCONSOLIDATED VARIABLE INTEREST ENTITIES

NONCONSOLIDATED VARIABLE INTEREST ENTITIESHistorically we entered into purchase, assignment and assumption agreements to assign payment and performance obligations for certain operating lease agreements with lessors, as well as customer fleet service payments related to these operating leases, with unconsolidated entities in which we had variable interests. These variable interest entities, or VIEs, included LRT Logistics Funding LLC, USD Fleet Funding LLC, USD Fleet Funding Canada Inc., and USD Logistics Funding Canada Inc. We treated those entities as variable interests under the applicable accounting guidance due to their having an insufficient amount of equity invested at risk to finance

their activities without additional subordinated financial support. We were not the primary beneficiary of the VIEs, as we did not have the power to direct the activities that most significantly affected the economic performance of the VIEs, nor did we have the power to remove the managing member under the terms of the VIEs’ limited liability company agreements. Accordingly, we did not consolidate the results of the VIEs in our consolidated financial statements.

As of the end of February 2021, the remaining railcar leases associated with these VIEs were either assigned directly to our customers or have expired. As such, we have terminated our relationship with these VIEs discussed herein effective as of the end of February 2021.

The following table summarizes the total assets and liabilities between us and the VIEs as reflected in our consolidated balance sheet at December 31, 2020, as well as our maximum exposure to losses from entities in which we had a variable interest, but were not the primary beneficiary. Generally, our maximum exposure to losses was limited to amounts receivable for services we provided, reduced by any related liabilities.

	December 31, 2020
	Total assets		Total liabilities		Maximum exposure to loss
	(in thousands)
Accounts receivable	$	43	$	—	$	33
Deferred revenue	—		10		—
	$	43	$	10	$	33

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TRANSACTIONS WITH RELATED PARTIES

3 Months Ended

Mar. 31, 2021

Related Party Transactions [Abstract]

TRANSACTIONS WITH RELATED PARTIES

TRANSACTIONS WITH RELATED PARTIES

Nature of Relationship with Related Parties

USD is engaged in designing, developing, owning and managing large-scale multi-modal logistics centers and other energy-related infrastructure across North America. USD is also the sole owner of USDG and the ultimate parent of our general partner. USD is owned by Energy Capital Partners, Goldman Sachs and certain members of its management.

USDG is the sole owner of our general partner and at March 31, 2021, owns 11,557,090 of our common units representing a 41.7% limited partner interest in us. As of March 31, 2021, a value of up to $10.0 million of these common units were pledged as collateral under USDG’s letter of credit facility. USDG also provides us with general and administrative support services necessary for the operation and management of our business.

USD Partners GP LLC, our general partner, currently owns all 461,136 of our general partner units representing a 1.7% general partner interest in us, as well as all of our incentive distribution rights. Pursuant to our partnership agreement, our general partner is responsible for our overall governance and operations. However, our general partner has no obligation to, does not intend to and has not implied that it would, provide financial support to or fund cash flow deficits of the Partnership.

USD Marketing LLC, or USDM, is a wholly-owned subsidiary of USDG organized to promote contracting for services provided by our terminals and to facilitate the marketing of customer products.

USD Terminals Canada II ULC, or USDTC II, is an indirect, wholly-owned Canadian subsidiary of USDG, organized for the purposes of pursuing expansion and other development opportunities associated with our Hardisty Terminal, pursuant to the Development Rights and Cooperation agreement between our wholly-owned subsidiary USD Terminals Canada ULC, or USDTC, and USDG. USDTC owns the legacy crude oil loading facility we refer to as the Hardisty Terminal. USDTC II completed construction of the Hardisty South expansion (“Hardisty South”) which commenced operations in January 2019. Hardisty South, which is owned and operated by USDTC II, added one and one-half 120-railcar unit trains of transloading capacity per day, or approximately 112,500 barrels per day,

of takeaway capacity to the terminal by modifying the existing loading rack and building additional infrastructure and trackage.

Omnibus Agreement

We are party to an omnibus agreement with USD, USDG and certain of their subsidiaries, or Omnibus Agreement, including our general partner, pursuant to which we obtain and make payments for specified services provided to us and for out-of-pocket costs incurred on our behalf. We pay USDG, in equal monthly installments, the annual amount USDG estimates will be payable by us during the calendar year for providing services for our benefit. The Omnibus Agreement provides that this amount may be adjusted annually to reflect, among other things, changes in the scope of the general and administrative services provided to us due to a contribution, acquisition or disposition of assets by us or our subsidiaries, or for changes in any law, rule or regulation applicable to us, which affects the cost of providing the general and administrative services. We also reimburse USDG for any out-of-pocket costs and expenses incurred on our behalf in providing general and administrative services to us. This reimbursement is in addition to the amounts we pay to reimburse our general partner and its affiliates for certain costs and expenses incurred on our behalf for managing our business and operations, as required by our partnership agreement.

The total amounts charged to us under the Omnibus Agreement for the three months ended March 31, 2021 and 2020 was $1.7 million and $2.0 million, respectively, which amounts are included in “Selling, general and administrative — related party” in our consolidated statements of operations. We had a payable balance of $0.3 million with respect to these costs at March 31, 2021 and December 31, 2020, included in “Accounts payable and accrued expenses — related party” in our consolidated balance sheets.

Marketing Services Agreement

In connection with our purchase of the Stroud terminal, we entered into a Marketing Services Agreement with USDM, in May 2017, whereby we granted USDM the right to market the capacity at the Stroud Terminal in excess of the original capacity of our initial customer in exchange for a nominal per barrel fee. USDM is obligated to fund any related capital costs associated with increasing the throughput or efficiency of the terminal to handle additional throughput. Upon expiration of our contract with the initial Stroud customer in June 2020, the same marketing rights now apply to all throughput at the Stroud Terminal in excess of the throughput necessary for the Stroud Terminal to generate Adjusted EBITDA that is at least equal to the average monthly Adjusted EBITDA derived from the initial Stroud customer during the 12 months prior to expiration. We also granted USDG the right to develop other projects at the Stroud Terminal in exchange for the payment to us of market-based compensation for the use of our property for such development projects. Any such development projects would be wholly-owned by USDG and would be subject to our existing right of first offer with respect to midstream projects developed by USDG. Payments made under the Marketing Services Agreement during the periods presented in this Report are discussed below under the heading “Related Party Revenue and Deferred Revenue.” 

Hardisty Terminal Services Agreement

We entered into a terminal services agreement with USDTC II in 2019, whereby Hardisty South will provide terminalling services for a third-party customer of our Hardisty Terminal for contracted capacity that exceeds the transloading capacity currently available. We incurred $2.1 million and $2.0 million of expenses pursuant to the arrangement for the three months ended March 31, 2021 and 2020, respectively, which amounts are included in “Operating and maintenance expense — related party” in our consolidated statements of operations. These costs represent the same rate, on a per barrel basis, that we received as revenue from our third-party customer, which is included in “Terminalling Services” revenue in our consolidated statements of operations. Additionally, in conjunction with the agreement, we recorded a contract asset of $2.1 million and $1.7 million at March 31, 2021 and December 31, 2020, respectively, on our consolidated balance sheet in “Other non-current assets — related party”, representing long-term prepaid expense associated with this agreement due to tiered billing provisions in the related terminalling services agreements.

Hardisty Shared Facilities Agreement

USDTC facilitates the provision of services on behalf of USDTC II pursuant to the terms of a shared facilities agreement, which includes all subcontracted railcar loading, operating, maintenance, pipeline and management services for the entire Hardisty terminal, including Hardisty South owned by USDTC II. USDTC passes through a proportionate amount of the cost of such services to USDTC II. Our financial statements only reflect the cost incurred by USDTC.

Related Party Revenue and Deferred Revenue

We have agreements to provide terminalling and fleet services for USDM with respect to our Hardisty Terminal and terminalling services with respect to our Stroud terminal, which also include reimbursement to us for certain out-of-pocket expenses we incur.

USDM assumed the rights and obligations for terminalling capacity at our Hardisty Terminal from another customer in June 2017 to facilitate the origination of crude oil barrels by the Stroud customer from our Hardisty Terminal for delivery to the Stroud terminal. As a result of USDM assuming these rights and obligations and in order to accommodate the needs of the Stroud customer, the contracted term for the capacity held by USDM at our Hardisty Terminal was extended from June 30, 2019 to June 30, 2020. The terms and conditions of these agreements were similar to the terms and conditions of agreements we have with other parties at the Hardisty Terminal that are not related to us. USDM’s agreement with the third party customer was renewed and extended, effective July 1, 2020, and USDM subsequently assigned its terminalling services agreement with the third party customer directly to us and is therefore no longer a customer at our Hardisty terminal. USDM controlled approximately 25% of the available monthly capacity of the Hardisty Terminal through June 30, 2020.

In connection with our purchase of the Stroud terminal, we also entered into a Marketing Services Agreement with USDM, as discussed above. Pursuant to the terms of the agreement, we receive a fixed amount per barrel from USDM in exchange for marketing the additional capacity available at the Stroud terminal. We also received revenue for providing additional terminalling services at our Hardisty Terminal to USDM pursuant to the terms of its agreement with us. Additionally, effective January 2019, we entered into a six month terminalling services agreement with USDM at our Casper Terminal to maximize utilization of available terminalling and storage capacity by offering these services to customers on an uncommitted basis at current market rates. This agreement automatically renews for successive periods of six months on an evergreen basis unless otherwise canceled by either party. We include amounts received pursuant to these arrangements as revenue in the table below under “Terminalling services — related party” in our consolidated statements of operations. Additionally, we received revenue from USDM for the lease of 200 railcars pursuant to the terms of an existing agreement with us, which is included in the table below under “Fleet leases — related party” and “Fleet services — related party” and in our consolidated statements of operations.

Our related party revenues from USD and affiliates are presented below in the following table for the indicated periods:

		Three Months Ended March 31,
		2021		2020
	(in thousands)
Terminalling services — related party		$	1,103	$	4,088
Fleet leases — related party		984		984
Fleet services — related party		227		227
		$	2,314	$	5,299

We had the following amounts outstanding with USD and affiliates on our consolidated balance sheets as presented below in the following table for the indicated periods:

	March 31, 2021		December 31, 2020
	(in thousands)
Accounts receivable — related party	$	2,569	$	2,460
Accounts payable and accrued expenses — related party (1)	$	65	$	64
Other current and non-current assets — related party (2)	$	2,138	$	1,721
Other non-current liabilities related party (3)	$	4	$	—
Deferred revenue — related party (4)	$	410	$	410

(1)Does not include amounts payable to related parties associated with the Omnibus Agreement, as discussed above.

(2)Includes a contract asset associated with the Hardisty Terminal Services Agreement with USDTC II, as discussed above. Also includes a contract asset associated with a lease agreement with USDM. Refer to Note 4. Revenues for further discussion.

(3)Represents a contract liability associated with a lease agreement with USDM and cumulative revenue that has been deferred due to tiered billing provisions. Refer to Note 4. Revenues for further discussion.

(4)Represents deferred revenues associated with our fleet services agreements with USD and affiliates for amounts we have collected from them for their prepaid leases.

Cash Distributions

We paid the following aggregate cash distributions to USDG as a holder of our common units and to USD Partners GP LLC as sole holder of our general partner interest and IDRs.

Distribution Declaration Date	Record Date	Distribution Payment Date	Amount Paid to  USDG		Amount Paid to USD Partners GP LLC
			(in thousands)
January 28, 2021	February 10, 2021	February 19, 2021	$	1,283	$	51

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COMMITMENTS AND CONTINGENCIES	3 Months Ended
	Mar. 31, 2021
Commitments and Contingencies Disclosure [Abstract]
COMMITMENTS AND CONTINGENCIES	COMMITMENTS AND CONTINGENCIESFrom time to time, we may be involved in legal, tax, regulatory and other proceedings in the ordinary course of business. We do not believe that we are currently a party to any such proceedings that will have a material adverse impact on our financial condition or results of operations.

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SEGMENT REPORTING

3 Months Ended

Mar. 31, 2021

Segment Reporting [Abstract]

SEGMENT REPORTING

SEGMENT REPORTING

We manage our business in two reportable segments: Terminalling services and Fleet services. The Terminalling services segment charges minimum monthly commitment fees under multi-year take-or-pay contracts to load and unload various grades of crude oil into and from railcars, as well as fixed fees per gallon to transload ethanol from railcars, including related logistics services. We also facilitate rail-to-pipeline shipments of crude oil. Our Terminalling services segment also charges minimum monthly fees to store crude oil in tanks that are leased to our customers. The Fleet services segment provides customers with railcars and fleet services related to the transportation of liquid hydrocarbons and biofuels under multi-year, take-or-pay contracts. Corporate activities are not considered a reportable segment, but are included to present shared services and financing activities which are not allocated to our established reporting segments.

Our segments offer different services and are managed accordingly. Our chief operating decision maker, or CODM, regularly reviews financial information about both segments in order to allocate resources and evaluate performance. Our CODM assesses segment performance based on the cash flows produced by our established reporting segments using Segment Adjusted EBITDA. Segment Adjusted EBITDA is a measure calculated in accordance with GAAP. We define Segment Adjusted EBITDA as “Net income (loss)” of each segment adjusted for depreciation and amortization, interest, income taxes, changes in contract assets and liabilities, deferred revenues, foreign currency transaction gains and losses and other items which do not affect the underlying cash flows

produced by our businesses. As such, we have concluded that disaggregating revenue by reporting segments appropriately depicts how the nature, amount, timing, and uncertainty of revenue and cash flows are affected by economic factors.

Segment Allocation of Certain Selling, General and Administrative Costs

Historically, we have allocated certain selling, general and administrative expenses to our Terminalling services and Fleet services segments that included corporate function personnel costs for managing our business that are allocated to us by our general partner, as well as other administrative expenses including audit fees and certain consulting fees. Beginning with the first quarter in 2021, these selling, general, and administrative expenses that are not directly related to operating our Terminalling services and Fleet services segments will now be allocated to corporate selling, general, and administrative expenses to better reflect the financial results of our Terminalling services and Fleet services segments.

	Three Months Ended March 31, 2021
	Terminalling services		Fleet services		Corporate		Total
	(in thousands)
Revenues
Terminalling services	$	28,105	$	—	$	—	$	28,105
Terminalling services — related party	1,103		—		—		1,103
Fleet leases — related party	—		984		—		984
Fleet services	—		24		—		24
Fleet services — related party	—		227		—		227
Freight and other reimbursables	124		32		—		156
Total revenues	29,332		1,267		—		30,599
Operating costs
Subcontracted rail services	3,141		—		—		3,141
Pipeline fees	6,046		—		—		6,046
Freight and other reimbursables	124		32		—		156
Operating and maintenance	3,924		998		—		4,922
Selling, general and administrative	1,019		92		3,622		4,733
Goodwill impairment loss	—		—		—		—
Depreciation and amortization	5,471		—		—		5,471
Total operating costs	19,725		1,122		3,622		24,469
Operating income (loss)	9,607		145		(3,622)		6,130
Interest expense	—		—		1,735		1,735
Gain associated with derivative instruments	—		—		(3,076)		(3,076)
Foreign currency transaction loss (gain)	133		—		(194)		(61)
Other income, net	(20)		—		—		(20)
Provision from income taxes	197		27		—		224
Net income (loss)	$	9,297	$	118	$	(2,087)	$	7,328

	Three Months Ended March 31, 2020
	Terminalling services		Fleet services		Corporate		Total
	(in thousands)
Revenues
Terminalling services	$	24,235	$	—	$	—	$	24,235
Terminalling services — related party	4,088		—		—		4,088
Fleet leases — related party	—		984		—		984
Fleet services	—		50		—		50
Fleet services — related party	—		227		—		227
Freight and other reimbursables	617		5		—		622
Total revenues	28,940		1,266		—		30,206
Operating costs
Subcontracted rail services	3,445		—		—		3,445
Pipeline fees	6,347		—		—		6,347
Freight and other reimbursables	617		5		—		622
Operating and maintenance	4,088		1,020		—		5,108
Selling, general and administrative	1,723		313		3,137		5,173
Goodwill impairment loss	33,589		—		—		33,589
Depreciation and amortization	5,422		—		—		5,422
Total operating costs	55,231		1,338		3,137		59,706
Operating loss	(26,291)		(72)		(3,137)		(29,500)
Interest expense	—		—		2,739		2,739
Loss associated with derivative instruments	—		—		2,873		2,873
Foreign currency transaction gain	(74)		(6)		(12)		(92)
Other income, net	(729)		—		(3)		(732)
Benefit from income taxes	(47)		(460)		—		(507)
Net income (loss)	$	(25,441)	$	394	$	(8,734)	$	(33,781)

Segment Adjusted EBITDA

The following tables present the computation of Segment Adjusted EBITDA, which is a measure determined in accordance with GAAP, for each of our segments for the periods indicated:

		Three Months Ended March 31,
Terminalling Services Segment		2021		2020
	(in thousands)
Net income (loss)		$	9,297	$	(25,441)
Interest income (1)		(1)		(21)
Depreciation and amortization		5,471		5,422
Provision for (benefit from) income taxes		197		(47)
Foreign currency transaction loss (gain) (2)		133		(74)
Goodwill impairment loss		—		33,589
Non-cash deferred amounts (3)		1,683		437
Segment Adjusted EBITDA		$	16,780	$	13,865

(1)    Represents interest income associated with our Terminalling Services segment that is included in “Other income, net” in our consolidated statements of operations.

(2)    Represents foreign exchange transaction amounts associated with activities between our U.S. and Canadian subsidiaries.

(3)    Represents the change in non-cash contract assets and liabilities associated with revenue recognized at blended rates based on tiered rate structures in certain of our customer contracts and deferred revenue associated with deficiency credits that are expected to be used in the future prior to their expiration. Amounts presented are net of the corresponding prepaid Gibson pipeline fee that will be recognized as expense concurrently with the recognition of revenue.

		Three Months Ended March 31,
Fleet Services Segment		2021		2020
	(in thousands)
Net income		$	118	$	394
Provision for (benefit from) income taxes		27		(460)
Foreign currency transaction gain (1)		—		(6)
Segment Adjusted EBITDA		$	145	$	(72)

(1)    Represents foreign exchange transaction amounts associated with activities between our U.S. and Canadian subsidiaries.

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DERIVATIVE FINANCIAL INSTRUMENTS

3 Months Ended

Mar. 31, 2021

Derivative Instruments and Hedging Activities Disclosure [Abstract]

DERIVATIVE FINANCIAL INSTRUMENTS

DERIVATIVE FINANCIAL INSTRUMENTSOur net income, or loss, and cash flows are subject to fluctuations resulting from changes in interest rates on our variable rate debt obligations and from changes in foreign currency exchange rates, particularly with respect to the U.S. dollar and the Canadian dollar. In limited circumstances, we may also hold long positions in the commodities we handle on behalf of our customers, which exposes us to commodity price risk. We use derivative financial instruments, including futures, forwards, swaps, options and other financial instruments with similar characteristics, to manage the risks associated with market fluctuations in interest rates, foreign currency exchange rates and commodity prices, as well as to reduce volatility in our cash flows. We have not historically designated, nor do we expect to designate, our derivative financial instruments as hedges of the underlying risk exposure. All of our financial instruments are employed in connection with an underlying asset, liability and/or forecasted transaction and are not entered into for speculative purposes.

Interest Rate Derivatives

We use interest rate derivative financial instruments to partially mitigate our exposure to interest rate fluctuations on our variable rate debt. Under our Credit Agreement, one-month LIBOR is used as the index rate for the interest we are charged on amounts borrowed under our Revolving Credit Facility.

In November 2017, we entered into a five-year interest rate collar contract with a $100 million notional value. The collar established a range where we paid the counterparty if the one-month Overnight Index Swap, or OIS, fell below the established floor rate of 1.70%, and the counterparty paid us if the one-month OIS rate exceeded the established ceiling rate of 2.50%. The collar settled monthly through the termination date. No payments or receipts were exchanged on the interest rate collar contracts unless interest rates rose above or fell below the predetermined ceiling or floor rate. Prior to February 2019, our interest rate collar contract discussed above was based on one-month LIBOR, which is being phased out by financial institutions in the United States.

In September 2020, we terminated our existing interest rate collar discussed above and simultaneously entered into a new interest rate swap that was made effective as of August 2020. The new interest rate swap is a five-year contract with a $150 million notional value that fixes our one-month LIBOR to 0.84% for the notional value of the swap agreement instead of the variable rate that we pay under our Credit Agreement. The swap settles monthly through the termination date in August 2025.

Derivative Positions

We record all of our derivative financial instruments at their fair values in the line items specified below within our consolidated balance sheets, the amounts of which were as follows at the dates indicated:

	March 31, 2021		December 31, 2020
	(in thousands)
Other non-current assets	577		—
Other current liabilities	$	(1,067)	$	(1,086)
Other non-current liabilities	—		(2,743)
	$	(490)	$	(3,829)

We have not designated our derivative financial instruments as hedges of our interest rate exposure. As a result, changes in the fair value of these derivatives are recorded as “Loss (gain) associated with derivative instruments” in our consolidated statements of operations. The gains or losses associated with changes in the fair value of our derivative contracts do not affect our cash flows until the underlying contract is settled by making or receiving a payment to or from the counterparty. In connection with our derivative activities, we recognized the following amounts during the periods presented:

		Three Months Ended March 31,
		2021		2020
	(in thousands)
Loss (gain) associated with derivative instruments		$	(3,076)	$	2,873

We determine the fair value of our derivative financial instruments using third party pricing information that is derived from observable market inputs, which we classify as level 2 with respect to the fair value hierarchy.

The following table presents summarized information about the fair values of our outstanding interest rate contracts for the periods indicated:

					March 31, 2021		December 31, 2020
	Notional		Interest Rate Parameters		Fair Value		Fair Value
					(in thousands)
Swap Agreements
Swap maturing August 2025	$	150,000,000	0.84	%	$	(490)	$	(3,829)

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PARTNERS' CAPITAL

3 Months Ended

Mar. 31, 2021

Equity [Abstract]

PARTNERS' CAPITAL

PARTNERS’ CAPITAL

Our common units represent and subordinated units represented limited partner interests in us. The holders of common units are and subordinated units were entitled to participate in partnership distributions and to exercise the rights and privileges available to limited partners under our partnership agreement.

All of our subordinated units converted into common units on a one-for-one basis in separate sequential tranches. Each tranche was comprised of 20.0% of the subordinated units issued in conjunction with our IPO. Each separate tranche was eligible to convert on or after December 31, 2015 (but no more frequently than once in any twelve-month period), provided on such date: (i) distributions of available cash from operating surplus on each of the outstanding common units, Class A units, subordinated units and general partner units equaled or exceeded $1.15 per unit (the annualized minimum quarterly distribution) for the four quarter period immediately preceding that date; (ii) the adjusted operating surplus generated during the four quarter period immediately preceding that date equaled or exceeded the sum of $1.15 per unit (the annualized minimum quarterly distribution) on all of the common units, Class A units, subordinated units and general partner units outstanding during that period on a fully diluted basis; and (iii) there were no arrearages in the payment of the minimum quarterly distribution on our common units. For each successive tranche, the four quarter period specified in clauses (i) and (ii) above must have commenced after the four quarter period applicable to any prior tranche of subordinated units. In February 2020, pursuant to the terms set forth in our partnership agreement, we converted the fifth and final tranche of 2,092,709 of our subordinated units into common units upon satisfaction of the conditions established for conversion.

Pursuant to the terms of the USD Partners LP Amended and Restated 2014 Long-Term Incentive Plan, which we refer to as the A/R LTIP, our phantom unit awards, or Phantom Units, granted to directors and employees of our general partner and its affiliates, which are classified as equity, are converted into our common units upon vesting. Equity-classified Phantom Units totaling 557,579 vested during the first three months in 2021, of which 379,726 were converted into our common units after 177,853 Phantom Units were withheld from participants for the payment of applicable employment-related withholding taxes. The conversion of these Phantom Units did not have any economic impact on Partners’ Capital, since the economic impact is recognized over the vesting period. Additional information and discussion regarding our unit based compensation plans is included below in Note 17. Unit Based Compensation.

The board of directors of our general partner has adopted a cash distribution policy pursuant to which we intend to distribute at least the minimum quarterly distribution of $0.2875 per unit ($1.15 per unit on an annualized basis) on all of our units to the extent we have sufficient available cash after the establishment of cash reserves and the payment of our expenses, including payments to our general partner and its affiliates. The board of directors of our general partner may change our distribution policy at any time and from time to time. Our partnership agreement does not require us to pay cash distributions on a quarterly or other basis. The amount of distributions we pay under our cash distribution policy and the decision to make any distribution are determined by our general partner. For the quarter ended March 31, 2021, the board of directors of our general partner determined that we had sufficient available cash after the establishment of cash reserves and the payment of our expenses to distribute $0.1135 per unit on all of our units.

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UNIT BASED COMPENSATION

3 Months Ended

Mar. 31, 2021

Share-based Payment Arrangement [Abstract]

UNIT BASED COMPENSATION

UNIT BASED COMPENSATION

Long-term Incentive Plan

In 2021 and 2020, the board of directors of our general partner, acting in its capacity as our general partner, approved the grant of 667,543 and 694,140 Phantom Units, respectively, to directors and employees of our general partner and its affiliates under our A/R LTIP. At March 31, 2021, we had 501,448 Phantom Units remaining available for issuance. The Phantom Units are subject to all of the terms and conditions of the A/R LTIP and the Phantom Unit award agreements, which are collectively referred to as the Award Agreements. Award amounts for each of the grants are generally determined by reference to a specified dollar amount based on an allocation formula which included a percentage multiplier of the grantee’s base salary, among other factors, converted to a number of units based on the closing price of one of our common units preceding the grant date, as determined by the board of directors of our general partner and quoted on the NYSE.

Phantom Unit awards generally represent rights to receive our common units upon vesting. However, with respect to the awards granted to directors and employees of our general partner and its affiliates domiciled in Canada, for each Phantom Unit that vests, a participant is entitled to receive cash for an amount equivalent to the closing market price of one of our common units on the vesting date. Each Phantom Unit granted under the Award Agreements includes an accompanying distribution equivalent right, or DER, which entitles each participant to receive payments at a per unit rate equal in amount to the per unit rate for any distributions we make with respect to our common units. The Award Agreements granted to employees of our general partner and its affiliates generally contemplate that the individual grants of Phantom Units will vest in four equal annual installments based on the grantee’s continued employment through the vesting dates specified in the Award Agreements, subject to acceleration upon the grantee’s death or disability, or involuntary termination in connection with a change in control of the Partnership or our general partner. Awards to independent directors of the board of our general partner and an independent consultant typically vest over a one year period following the grant date.

The following tables present the award activity for our Equity-classified Phantom Units:

	Director and Independent Consultant Phantom Units	Employee Phantom Units	Weighted-Average Grant Date Fair Value Per Phantom Unit
Phantom Unit awards at December 31, 2020	40,065	1,324,837	$	10.98
Granted	40,065	573,204	$	4.82
Vested	(40,065)	(517,514)	$	11.33
Forfeited	—	(2,075)	$	8.44
Phantom Unit awards at March 31, 2021	40,065	1,378,452	$	8.18

	Director and Independent Consultant Phantom Units	Employee Phantom Units	Weighted-Average Grant Date Fair Value Per Phantom Unit
Phantom Unit awards at December 31, 2019	37,139	1,252,544	$	11.34
Granted	40,065	594,912	$	10.15
Vested	(37,139)	(481,336)	$	10.84
Forfeited	—	(38,507)	$	11.08
Phantom Unit awards at March 31,  2020	40,065	1,327,613	$	10.98

The following tables present the award activity for our Liability-classified Phantom Units:

	Director and Independent Consultant Phantom Units	Employee Phantom Units	Weighted-Average Grant Date Fair Value Per Phantom Unit
Phantom Unit awards at December 31, 2020	13,136	59,284	$	10.58
Granted	13,136	41,138	$	4.82
Vested	(13,136)	—	$	10.15
Phantom Unit awards at March 31, 2021	13,136	100,422	$	7.88

	Director and Independent Consultant Phantom Units	Employee Phantom Units	Weighted-Average Grant Date Fair Value Per Phantom Unit
Phantom Unit awards at December 31, 2019	12,177	44,620	$	11.53
Granted	13,136	46,027	$	10.15
Vested	(12,177)	—	$	11.37
Phantom Unit awards at March 31,  2020	13,136	90,647	$	10.76

The fair value of each Phantom Unit on the grant date is equal to the closing market price of our common units on the grant date. We account for the Phantom Unit grants to independent directors and employees of our general partner and its affiliates domiciled in Canada that are paid out in cash upon vesting, throughout the requisite vesting period, by revaluing the unvested Phantom Units outstanding at the end of each reporting period and recording a charge to compensation expense in “Selling, general and administrative” in our consolidated statements of operations and recognizing a liability in “Other current liabilities” in our consolidated balance sheets. With respect to the Phantom Units granted to consultants, independent directors and employees of our general partner and its affiliates domiciled in the United States, we amortize the initial grant date fair value over the requisite service period using the straight-line method with a charge to compensation expense in “Selling, general and administrative” in our consolidated statements of operations, with an offset to common units within the Partners’ Capital section of our consolidated balance sheet.

For the three months ended March 31, 2021 and 2020, we recognized $1.5 million and $1.6 million, respectively, of compensation expense associated with outstanding Phantom Units. As of March 31, 2021, we have unrecognized compensation expense associated with our outstanding Phantom Units totaling $11.6 million, which we expect to recognize over a weighted average period of 2.64 years. We have elected to account for actual forfeitures as they occur rather than using an estimated forfeiture rate to determine the number of awards we expect to vest.

We made payments to holders of the Phantom Units pursuant to the associated DERs we granted to them under the Award Agreements as follows:

		Three Months Ended March 31,
		2021		2020
	(in thousands)
Equity-classified Phantom Units (1)		$	152	$	477
Liability-classified Phantom Units		8		21
Total		$	160	$	498

(1)    We reclassified $2 thousand and $57 thousand to unit based compensation expense for DERs paid in relation to Phantom Units that have been forfeited for the three months ended March 31, 2021 and 2020, respectively.

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SUPPLEMENTAL CASH FLOW INFORMATION

3 Months Ended

Mar. 31, 2021

Supplemental Cash Flow Elements [Abstract]

SUPPLEMENTAL CASH FLOW INFORMATION

SUPPLEMENTAL CASH FLOW INFORMATION

The following table provides supplemental cash flow information for the periods indicated:

	Three Months Ended March 31,
	2021		2020
	(in thousands)
Cash paid for income taxes	$	286	$	317
Cash paid for interest	$	1,549	$	2,083
Cash paid for operating leases	$	1,566	$	1,885

Non-cash Investing Activities

For the three months ended March 31, 2021 and 2020, we had non-cash investing activities for capital expenditures for property and equipment that were financed through “Accounts payable and accrued expenses” as presented in the table below for the periods indicated:

	Three months ended March 31,
	2021		2020
	(in thousands)
Property and equipment financed through accounts payable and accrued expenses	$	136	$	(182)

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SUBSEQUENT EVENTS

3 Months Ended

Mar. 31, 2021

Subsequent Events [Abstract]

SUBSEQUENT EVENTS

SUBSEQUENT EVENTS

Distribution to Partners

On April 22, 2021, the board of directors of USD Partners GP LLC, acting in its capacity as our general partner, declared a quarterly cash distribution payable of $0.1135 per unit, or $0.454 per unit on an annualized basis, for the three months ended March 31, 2021. The distribution will be paid on May 14, 2021, to unitholders of record at the close of business on May 5, 2021. The distribution will include payment of $1.8 million to our public common unitholders, $1.3 million to USDG as a holder of our common units and $52 thousand to USD Partners GP LLC as a holder of the general partner interest.

Revolving Credit Facility Activity

Subsequent to March 31, 2021, we repaid $3.0 million under the terms of our existing $385 million Revolving Credit Facility. As of May 3, 2021, we had amounts outstanding of $186.0 million under the Revolving Credit Facility and $199.0 million available for borrowings under the Revolving Credit Facility based on capacity that is subject to certain covenants. Refer to Note 9. Debt for more information.

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ORGANIZATION AND BASIS OF PRESENTATION (Policies)

3 Months Ended

Mar. 31, 2021

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Basis of Presentation

Basis of Presentation

Our accompanying unaudited interim consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States, or GAAP, for interim consolidated financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not include all the information and disclosures required by GAAP for complete consolidated financial statements. In the opinion of our management, they contain all adjustments, consisting only of normal recurring adjustments, which our management considers necessary to present fairly our financial position as of March 31, 2021, our results of operations for the three months ended March 31, 2021 and 2020, and our cash flows for the three months ended March 31, 2021 and 2020. We derived our consolidated balance sheet as of December 31, 2020 from the audited consolidated financial statements included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2020. Our results of operations for the three months ended March 31, 2021 and 2020 should not be taken as indicative of the results to be expected for the full year due to fluctuations in the supply of and demand for crude oil and biofuels, timing and completion of acquisitions, if any, changes in the fair market value of our derivative instruments and the impact of fluctuations in foreign currency exchange rates. These unaudited interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements and accompanying notes thereto presented in our Annual Report on Form 10-K for the fiscal year ended December 31, 2020.

COVID-19 Update

During 2020, the COVID-19 pandemic adversely affected the global economy, disrupted global supply chains and created significant volatility in the financial markets. As a result, there was significant reduction in demand for, and fluctuations in the prices of crude oil, natural gas and natural gas liquids. This significantly impacted Canadian producers, which in turn resulted in lower crude oil prices and led to lower throughput volume through our facilities.

However, the decline in throughput volumes at our facilities did not have a material impact on our results of operations or cash flows during 2020, as a substantial amount of our terminalling services operating cash flows are generated from take-or-pay contracts with minimum monthly commitment fees with mainly investment grade customers. There still remains significant uncertainty given the unprecedented and evolving nature of the COVID-19 pandemic and the state of the commodity markets. As such, we will continue to actively monitor their impact on our operations and financial condition.

Foreign Currency Translation

Foreign Currency Translation

We conduct a substantial portion of our operations in Canada, which we account for in the local currency, the Canadian dollar. We translate most Canadian dollar denominated balance sheet accounts into our reporting currency, the U.S. dollar, at the end of period exchange rate, while most accounts in our statement of operations accounts are translated into our reporting currency based on the average exchange rate for each monthly period. Fluctuations in the exchange rates between the Canadian dollar and the U.S. dollar can create variability in the amounts we translate and report in U.S. dollars.

Within these consolidated financial statements, we denote amounts denominated in Canadian dollars with “C$” immediately prior to the stated amount.

Recently Adopted Accounting Pronouncements

Recently Adopted Accounting Pronouncements

Income Taxes (ASU 2019-12)

In December 2019, the Financial Accounting Standards Board, or FASB, issued Accounting Standards Update No. 2019-12, or ASU 2019-12, which amends the FASB Accounting Standards Codification, or ASC, Topic 740, by removing certain exceptions related to the approach for intraperiod tax allocation, the methodology for calculating income taxes in an interim period and the recognition of deferred tax liabilities for outside basis differences. It also simplifies aspects of the accounting for franchise taxes and enacted changes in tax laws or rates and clarifies the accounting for transactions that result in a step-up in the tax basis of goodwill. In addition, under the provisions of ASU 2019-12, single-member limited liability companies and similar disregarded entities that are not subject to income tax are not required to recognize an allocation of consolidated income tax expense in their separate financial statements, but they could elect to do so. The pronouncement is effective for fiscal years beginning after December 15, 2020, or for any interim periods within those fiscal years, with early adoption permitted.

We adopted the provisions of ASU 2019-12 on January 1, 2021. Our adoption of this standard did not have an impact on our financial statements.

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NET INCOME (LOSS) PER LIMITED PARTNER INTEREST (Tables)

3 Months Ended

Mar. 31, 2021

Earnings Per Share [Abstract]

Schedule of distribution method to limited and general partners

The formula for distributing available cash as set forth in our partnership agreement is as follows:

Distribution Targets	Portion of Quarterly Distribution Per Unit	Percentage Distributed to Limited Partners	Percentage Distributed to General Partner (including IDRs) (1)
Minimum Quarterly Distribution	Up to $0.2875	98%	2%
First Target Distribution	> $0.2875 to $0.330625	98%	2%
Second Target Distribution	> $0.330625 to $0.359375	85%	15%
Third Target Distribution	> $0.359375 to $0.431250	75%	25%
Thereafter	Amounts above $0.431250	50%	50%

(1)Calculated as if our general partner holds the original 2% general partner interest in us, which is currently 1.7%.

Schedule of earnings per share, basic and diluted

We determined basic and diluted net income (loss) per limited partner unit as set forth in the following tables:

	For the Three Months Ended March 31, 2021
	Common Units		Subordinated Units (7)		General Partner Units		Total
	(in thousands, except per unit amounts)
Net income attributable to general and limited partner interests in USD Partners LP (1)	$	7,204	$	—	$	124	$	7,328
Less: Distributable earnings (2)	3,248		—		55		3,303
Excess net income	$	3,956	$	—	$	69	$	4,025
Weighted average units outstanding (3)	27,030		—		461		27,491
Distributable earnings per unit (4)	$	0.12	$	—
Underdistributed earnings per unit (5)	0.15		—
Net income per limited partner unit (basic and diluted) (6)	$	0.27	$	—

(1)Represents net income allocated to each class of units based on the actual ownership of the Partnership during the period. There were no amounts attributed to the general partner for its incentive distribution rights.

(2)Represents the per unit distribution payable for the period based upon the quarterly distribution amounts of $0.1135 per unit or $0.454 on an annualized basis. Amounts presented for each class of units include a proportionate amount of the $161 thousand distributable to holders of the Equity classified Phantom Units pursuant to the distribution equivalent rights granted under the USD Partners LP 2014 Amended and Restated Long-Term Incentive Plan.

(3)Represents the weighted average units outstanding for the period.

(4)Represents the total distributable earnings divided by the weighted average number of units outstanding for the period.

(5)Represents the additional amount per unit necessary to distribute the excess net income for the period among our limited partners and our general partners according to the distribution formula for available cash as set forth in our partnership agreement.

(6)Our computation of net income per limited partner unit excludes the effects of 1,418,517 equity-classified phantom unit awards outstanding as they were anti-dilutive for the period presented.

(7)In February 2020, the final tranche of 2,092,709 subordinated units were converted into common units and therefore there were no subordinated units outstanding during 2021. Refer to Note 16. Partners Capital for more information.

	For the Three Months Ended March 31, 2020
	Common Units		Subordinated Units (7)		General Partner Units		Total
	(in thousands, except per unit amounts)
Net loss attributable to general and limited partner interests in USD Partners LP (1)	$	(33,195)	$	(15)	$	(571)	$	(33,781)
Less: Distributable earnings (2)	3,129		—		54		3,183
Distributions in excess of earnings	$	(36,324)	$	(15)	$	(625)	$	(36,964)
Weighted average units outstanding (3)	25,516		1,150		461		27,127
Distributable earnings per unit (4)	$	0.12	$	—
Overdistributed earnings per unit (5)	(1.42)		(0.01)
Net loss per limited partner unit (basic and diluted)(6)	$	(1.30)	$	(0.01)

(1)Represents net loss allocated to each class of units based on the actual ownership of the Partnership during the period. There were no amounts attributed to the general partner for its incentive distribution rights.

(2)Represents the per unit distributions paid for the period based upon the quarterly distribution of $0.111 per unit, or $0.444 per unit on an annualized basis. Amounts presented for each class of units include a proportionate amount of the $152 thousand distributed to holders of the Equity-classified Phantom Units pursuant to the distribution equivalent rights granted under the USD Partners LP 2014 Amended and Restated Long-Term Incentive Plan.

(3)Represents the weighted average units outstanding for the period.

(4)Represents the total distributable earnings divided by the weighted average number of units outstanding for the period.

(5)Represents the distributions in excess of earnings divided by the weighted average number of units outstanding for the period.

(6)Our computation of net loss per limited partner unit excludes the effects of 1,367,678 equity-classified phantom unit awards outstanding as they were anti-dilutive for the period presented.

(7)In February 2020, the final tranche of 2,092,709 subordinated units were converted into common units. Refer to Note 16. Partners Capital for more information.

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REVENUES (Tables)

3 Months Ended

Mar. 31, 2021

Revenue from Contract with Customer [Abstract]

Schedule of disaggregation of revenues

Additionally, the below tables summarize the geographic data for our revenues:

	Three Months Ended March 31, 2021
	U.S.		Canada		Total
	(in thousands)
Third party	$	7,638	$	20,647	$	28,285
Related party	$	2,314	$	—	$	2,314

	Three Months Ended March 31, 2020
	U.S.		Canada		Total
	(in thousands)
Third party	$	7,049	$	17,858	$	24,907
Related party	$	2,305	$	2,994	$	5,299

Schedule of remaining performance obligations

The transaction price allocated to the remaining performance obligations associated with our terminalling and fleet services agreements as of March 31, 2021 are as follows for the periods indicated:

	For the nine months ending December 31, 2021		2022		2023		2024		Thereafter		Total
	(in thousands)
Terminalling Services (1) (2) (3)	$	73,729	$	75,048	$	37,779	$	19,528	$	126,932	$	333,016
Fleet Services	682		1,195		—		—		—		1,877
Total	$	74,411	$	76,243	$	37,779	$	19,528	$	126,932	$	334,893

(1)A significant portion of our terminalling services agreements are denominated in Canadian dollars. We have converted the remaining performance obligations associated with these Canadian dollar-denominated contracts using the year-to-date average exchange rate of 0.7897 U.S. dollars for each Canadian dollar at March 31, 2021.

(2)Includes fixed monthly minimum commitment fees per contracts and excludes constrained estimates of variable consideration for rate-escalations associated with an index, such as the consumer price index, as well as any incremental revenue associated with volume activity above the minimum volumes set forth within the contracts. Also excludes estimated constrained variable consideration included in certain of our terminalling services agreements that is based on crude oil pricing index differentials.

(3)Assumes USD’s Diluent Recovery Unit project goes into service in the second half of 2021, which will result in certain terminalling services agreements of our Hardisty Terminal being automatically extended through mid-2031 and certain agreements at our Stroud Terminal having a termination right in June 2022.

Schedule of changes of balance of contract liabilities

We had the following amounts outstanding associated with our contract assets on our consolidated balance sheets in the financial statement line items presented below in the following table for the indicated periods:

	March 31, 2021		December 31, 2020
	(in thousands)
Other current assets	$	897	$	1,622

The following table presents the amounts outstanding on our consolidated balance sheets and changes

associated with the balance of our deferred revenue for the three months ended March 31, 2021:

	December 31, 2020		Cash Additions for Customer Prepayments		Revenue Recognized		March 31, 2021
	(in thousands)
Deferred revenue (1)	$	6,367	$	6,968	$	(6,367)	$	6,968
Other current liabilities	$	—	$	704	$	—	$	704
Other non-current liabilities (2)	$	10,087	$	781	$	—	$	10,868

(1)    Includes deferred revenue of $0.6 million for estimated breakage associated with the make-up rights options we granted to our customers, as discussed above.

(2)    Includes cumulative revenue that has been deferred due to tiered billing provisions included in certain of our Canadian dollar-denominated contracts, as discussed above. As such, the change in “Other non-current liabilities” presented has been increased by $121 thousand due to the impact of the change in the end of period exchange rate between December 31, 2020 and March 31, 2021.

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RESTRICTED CASH (Tables)

3 Months Ended

Mar. 31, 2021

Cash and Cash Equivalents [Abstract]

Restrictions on cash and cash equivalents

The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within our consolidated balance sheets to the amounts shown in our consolidated statements of cash flows for the specified periods:

	March 31,
	2021		2020
	(in thousands)
Cash and cash equivalents	$	3,066	$	4,622
Restricted Cash	7,955		8,200
Total cash, cash equivalents and restricted cash	$	11,021	$	12,822

Schedule of cash and cash equivalents

The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within our consolidated balance sheets to the amounts shown in our consolidated statements of cash flows for the specified periods:

	March 31,
	2021		2020
	(in thousands)
Cash and cash equivalents	$	3,066	$	4,622
Restricted Cash	7,955		8,200
Total cash, cash equivalents and restricted cash	$	11,021	$	12,822

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PROPERTY AND EQUIPMENT (Tables)

3 Months Ended

Mar. 31, 2021

Property, Plant and Equipment [Abstract]

Schedule of property and equipment

Our property and equipment is comprised of the following asset classifications as of the dates indicated:

	March 31, 2021		December 31, 2020		Estimated Depreciable Lives (Years)
	(in thousands)
Land	$	10,324	$	10,288	N/A
Trackage and facilities	128,189		127,401		10-30
Pipeline	32,735		32,735		20-30
Equipment	17,409		17,337		3-20
Furniture	67		67		5-10
Total property and equipment	188,724		187,828
Accumulated depreciation	(51,249)		(48,630)
Construction in progress (1)	1,256		643
Property and equipment, net	$	138,731	$	139,841

(1) The amounts classified as “Construction in progress” are excluded from amounts being depreciated. These amounts represent property that has not been placed into productive service as of the respective consolidated balance sheet date.

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LEASES (Tables)

3 Months Ended

Mar. 31, 2021

Leases [Abstract]

Summary of lease cost

We have noncancellable operating leases for railcars, buildings, storage tanks, offices, railroad tracks, and land.

	Three Months Ended March 31, 2021
Weighted-average discount rate	5.8	%
Weighted average remaining lease term in years	1.65

Our total lease cost consisted of the following items for the dates indicated:

		Three Months Ended March 31,
		2021		2020
	(in thousands)
Operating lease cost		$	1,479	$	1,486
Short term lease cost		44		45
Variable lease cost		18		9
Sublease income		(1,348)		(1,341)
Total		$	193	$	199

Future minimum rental commitments under noncancelable operating leases

The maturity analysis below presents the undiscounted cash payments we expect to make each period for property that we lease from others under noncancellable operating leases as of March 31, 2021 (in thousands): 

2021	$	4,179
2022	4,520
2023	35
2024	2
Total lease payments	$	8,736
Less: imputed interest	(428)
Present value of lease liabilities	$	8,308

Schedule of lease income

	Three Months Ended March 31,
	2021		2020
	(in thousands, except weighted average term)
Lease income (1)	$	2,185	$	2,186
Weighted average remaining lease term in years			1.58

(1)Lease income presented above includes lease income from related parties. Refer to Note 12. Transactions with Related Parties for additional discussion of lease income from related parties. Lease income associated with crude oil storage tanks we lease to customers of our terminals totaling $1.2 million for the three months ended March 31, 2021 and 2020, is included in “Terminalling services” revenues on our consolidated statements of operations.

Schedule of operating lease income to be received

The maturity analysis below presents the undiscounted future minimum lease payments we expect to receive from customers each period for property they lease from us under noncancellable operating leases as of March 31, 2021 (in thousands): 

2021	$	6,142
2022	5,367
Total	$	11,509

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INTANGIBLE ASSETS (Tables)

3 Months Ended

Mar. 31, 2021

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of identifiable intangible assets

The composition, gross carrying amount and accumulated amortization of our identifiable intangible assets are as follows as of the dates indicated:

	March 31, 2021		December 31, 2020
	(in thousands)
Carrying amount:
Customer service agreements	$	125,960	$	125,960
Other	106		106
Total carrying amount	126,066		126,066
Accumulated amortization:
Customer service agreements	(67,669)		(64,520)
Other	(56)		(54)
Total accumulated amortization	(67,725)		(64,574)
Total intangible assets, net	$	58,341	$	61,492

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DEBT (Tables)

3 Months Ended

Mar. 31, 2021

Debt Disclosure [Abstract]

Schedule of long-term debt

Our long-term debt balances included the following components as of the specified dates:

	March 31, 2021		December 31, 2020
	(in thousands)
Revolving Credit Facility	$	189,000	$	197,000
Less: Deferred financing costs, net	(1,312)		(1,520)
Total long-term debt, net	$	187,688	$	195,480

Schedule of line of credit facilities

We determined the capacity available to us under the terms of our Credit Agreement was as follows as of the specified dates:

	March 31, 2021		December 31, 2020
	(in millions)
Aggregate borrowing capacity under Credit Agreement	$	385.0	$	385.0
Less: Revolving Credit Facility amounts outstanding	189.0		197.0
Available under the Credit Agreement based on capacity	$	196.0	$	188.0
Available under the Credit Agreement based on covenants (1)	$	71.4	$	53.2

(1)    Pursuant to the terms of our Credit Agreement, our borrowing capacity, currently, is limited to 4.5 times our trailing 12-month consolidated EBITDA, which equates to $71.4 million and $53.2 million of borrowing capacity available at March 31, 2021 and December 31, 2020, respectively.

Schedule of interest expense, net

Interest expense associated with our outstanding indebtedness was as follows for the specified periods:

		Three Months Ended March 31,
		2021		2020
	(in thousands)
Interest expense on the Credit Agreement		$	1,528	$	2,532
Amortization of deferred financing costs		207		207
Total interest expense		$	1,735	$	2,739

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NONCONSOLIDATED VARIABLE INTEREST ENTITIES (Tables)

3 Months Ended

Mar. 31, 2021

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Schedule of variable interest entities

The following table summarizes the total assets and liabilities between us and the VIEs as reflected in our consolidated balance sheet at December 31, 2020, as well as our maximum exposure to losses from entities in which we had a variable interest, but were not the primary beneficiary. Generally, our maximum exposure to losses was limited to amounts receivable for services we provided, reduced by any related liabilities.

	December 31, 2020
	Total assets		Total liabilities		Maximum exposure to loss
	(in thousands)
Accounts receivable	$	43	$	—	$	33
Deferred revenue	—		10		—
	$	43	$	10	$	33

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TRANSACTIONS WITH RELATED PARTIES (Tables)

3 Months Ended

Mar. 31, 2021

Related Party Transactions [Abstract]

Schedule of deferred revenue, current portion - related party

Our related party revenues from USD and affiliates are presented below in the following table for the indicated periods:

		Three Months Ended March 31,
		2021		2020
	(in thousands)
Terminalling services — related party		$	1,103	$	4,088
Fleet leases — related party		984		984
Fleet services — related party		227		227
		$	2,314	$	5,299

We had the following amounts outstanding with USD and affiliates on our consolidated balance sheets as presented below in the following table for the indicated periods:

	March 31, 2021		December 31, 2020
	(in thousands)
Accounts receivable — related party	$	2,569	$	2,460
Accounts payable and accrued expenses — related party (1)	$	65	$	64
Other current and non-current assets — related party (2)	$	2,138	$	1,721
Other non-current liabilities related party (3)	$	4	$	—
Deferred revenue — related party (4)	$	410	$	410

(1)Does not include amounts payable to related parties associated with the Omnibus Agreement, as discussed above.

(2)Includes a contract asset associated with the Hardisty Terminal Services Agreement with USDTC II, as discussed above. Also includes a contract asset associated with a lease agreement with USDM. Refer to Note 4. Revenues for further discussion.

(3)Represents a contract liability associated with a lease agreement with USDM and cumulative revenue that has been deferred due to tiered billing provisions. Refer to Note 4. Revenues for further discussion.

(4)Represents deferred revenues associated with our fleet services agreements with USD and affiliates for amounts we have collected from them for their prepaid leases.

Distributions made to general and limited partner, by distribution

We paid the following aggregate cash distributions to USDG as a holder of our common units and to USD Partners GP LLC as sole holder of our general partner interest and IDRs.

Distribution Declaration Date	Record Date	Distribution Payment Date	Amount Paid to  USDG		Amount Paid to USD Partners GP LLC
			(in thousands)
January 28, 2021	February 10, 2021	February 19, 2021	$	1,283	$	51

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SEGMENT REPORTING (Tables)

3 Months Ended

Mar. 31, 2021

Segment Reporting [Abstract]

Summary of reportable segment data for continuing operations

	Three Months Ended March 31, 2021
	Terminalling services		Fleet services		Corporate		Total
	(in thousands)
Revenues
Terminalling services	$	28,105	$	—	$	—	$	28,105
Terminalling services — related party	1,103		—		—		1,103
Fleet leases — related party	—		984		—		984
Fleet services	—		24		—		24
Fleet services — related party	—		227		—		227
Freight and other reimbursables	124		32		—		156
Total revenues	29,332		1,267		—		30,599
Operating costs
Subcontracted rail services	3,141		—		—		3,141
Pipeline fees	6,046		—		—		6,046
Freight and other reimbursables	124		32		—		156
Operating and maintenance	3,924		998		—		4,922
Selling, general and administrative	1,019		92		3,622		4,733
Goodwill impairment loss	—		—		—		—
Depreciation and amortization	5,471		—		—		5,471
Total operating costs	19,725		1,122		3,622		24,469
Operating income (loss)	9,607		145		(3,622)		6,130
Interest expense	—		—		1,735		1,735
Gain associated with derivative instruments	—		—		(3,076)		(3,076)
Foreign currency transaction loss (gain)	133		—		(194)		(61)
Other income, net	(20)		—		—		(20)
Provision from income taxes	197		27		—		224
Net income (loss)	$	9,297	$	118	$	(2,087)	$	7,328

	Three Months Ended March 31, 2020
	Terminalling services		Fleet services		Corporate		Total
	(in thousands)
Revenues
Terminalling services	$	24,235	$	—	$	—	$	24,235
Terminalling services — related party	4,088		—		—		4,088
Fleet leases — related party	—		984		—		984
Fleet services	—		50		—		50
Fleet services — related party	—		227		—		227
Freight and other reimbursables	617		5		—		622
Total revenues	28,940		1,266		—		30,206
Operating costs
Subcontracted rail services	3,445		—		—		3,445
Pipeline fees	6,347		—		—		6,347
Freight and other reimbursables	617		5		—		622
Operating and maintenance	4,088		1,020		—		5,108
Selling, general and administrative	1,723		313		3,137		5,173
Goodwill impairment loss	33,589		—		—		33,589
Depreciation and amortization	5,422		—		—		5,422
Total operating costs	55,231		1,338		3,137		59,706
Operating loss	(26,291)		(72)		(3,137)		(29,500)
Interest expense	—		—		2,739		2,739
Loss associated with derivative instruments	—		—		2,873		2,873
Foreign currency transaction gain	(74)		(6)		(12)		(92)
Other income, net	(729)		—		(3)		(732)
Benefit from income taxes	(47)		(460)		—		(507)
Net income (loss)	$	(25,441)	$	394	$	(8,734)	$	(33,781)

Reconciliation of adjusted EBITDA to loss from continuing operations

The following tables present the computation of Segment Adjusted EBITDA, which is a measure determined in accordance with GAAP, for each of our segments for the periods indicated:

		Three Months Ended March 31,
Terminalling Services Segment		2021		2020
	(in thousands)
Net income (loss)		$	9,297	$	(25,441)
Interest income (1)		(1)		(21)
Depreciation and amortization		5,471		5,422
Provision for (benefit from) income taxes		197		(47)
Foreign currency transaction loss (gain) (2)		133		(74)
Goodwill impairment loss		—		33,589
Non-cash deferred amounts (3)		1,683		437
Segment Adjusted EBITDA		$	16,780	$	13,865

(1)    Represents interest income associated with our Terminalling Services segment that is included in “Other income, net” in our consolidated statements of operations.

(2)    Represents foreign exchange transaction amounts associated with activities between our U.S. and Canadian subsidiaries.

(3)    Represents the change in non-cash contract assets and liabilities associated with revenue recognized at blended rates based on tiered rate structures in certain of our customer contracts and deferred revenue associated with deficiency credits that are expected to be used in the future prior to their expiration. Amounts presented are net of the corresponding prepaid Gibson pipeline fee that will be recognized as expense concurrently with the recognition of revenue.

		Three Months Ended March 31,
Fleet Services Segment		2021		2020
	(in thousands)
Net income		$	118	$	394
Provision for (benefit from) income taxes		27		(460)
Foreign currency transaction gain (1)		—		(6)
Segment Adjusted EBITDA		$	145	$	(72)

(1)    Represents foreign exchange transaction amounts associated with activities between our U.S. and Canadian subsidiaries.

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DERIVATIVE FINANCIAL INSTRUMENTS (Tables)

3 Months Ended

Mar. 31, 2021

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Schedule of derivative positions included in the consolidated balance sheets at fair value

We record all of our derivative financial instruments at their fair values in the line items specified below within our consolidated balance sheets, the amounts of which were as follows at the dates indicated:

	March 31, 2021		December 31, 2020
	(in thousands)
Other non-current assets	577		—
Other current liabilities	$	(1,067)	$	(1,086)
Other non-current liabilities	—		(2,743)
	$	(490)	$	(3,829)

Schedule of gain (loss) on derivative instruments

In connection with our derivative activities, we recognized the following amounts during the periods presented:

		Three Months Ended March 31,
		2021		2020
	(in thousands)
Loss (gain) associated with derivative instruments		$	(3,076)	$	2,873

Schedule of derivative instruments

The following table presents summarized information about the fair values of our outstanding interest rate contracts for the periods indicated:

					March 31, 2021		December 31, 2020
	Notional		Interest Rate Parameters		Fair Value		Fair Value
					(in thousands)
Swap Agreements
Swap maturing August 2025	$	150,000,000	0.84	%	$	(490)	$	(3,829)

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UNIT BASED COMPENSATION (Tables)

3 Months Ended

Mar. 31, 2021

Share-based Payment Arrangement [Abstract]

Schedule of share-based compensation, activity

The following tables present the award activity for our Equity-classified Phantom Units:

	Director and Independent Consultant Phantom Units	Employee Phantom Units	Weighted-Average Grant Date Fair Value Per Phantom Unit
Phantom Unit awards at December 31, 2020	40,065	1,324,837	$	10.98
Granted	40,065	573,204	$	4.82
Vested	(40,065)	(517,514)	$	11.33
Forfeited	—	(2,075)	$	8.44
Phantom Unit awards at March 31, 2021	40,065	1,378,452	$	8.18

	Director and Independent Consultant Phantom Units	Employee Phantom Units	Weighted-Average Grant Date Fair Value Per Phantom Unit
Phantom Unit awards at December 31, 2019	37,139	1,252,544	$	11.34
Granted	40,065	594,912	$	10.15
Vested	(37,139)	(481,336)	$	10.84
Forfeited	—	(38,507)	$	11.08
Phantom Unit awards at March 31,  2020	40,065	1,327,613	$	10.98

The following tables present the award activity for our Liability-classified Phantom Units:

	Director and Independent Consultant Phantom Units	Employee Phantom Units	Weighted-Average Grant Date Fair Value Per Phantom Unit
Phantom Unit awards at December 31, 2020	13,136	59,284	$	10.58
Granted	13,136	41,138	$	4.82
Vested	(13,136)	—	$	10.15
Phantom Unit awards at March 31, 2021	13,136	100,422	$	7.88

	Director and Independent Consultant Phantom Units	Employee Phantom Units	Weighted-Average Grant Date Fair Value Per Phantom Unit
Phantom Unit awards at December 31, 2019	12,177	44,620	$	11.53
Granted	13,136	46,027	$	10.15
Vested	(12,177)	—	$	11.37
Phantom Unit awards at March 31,  2020	13,136	90,647	$	10.76

Schedule of phantom units granted

We made payments to holders of the Phantom Units pursuant to the associated DERs we granted to them under the Award Agreements as follows:

		Three Months Ended March 31,
		2021		2020
	(in thousands)
Equity-classified Phantom Units (1)		$	152	$	477
Liability-classified Phantom Units		8		21
Total		$	160	$	498

(1)    We reclassified $2 thousand and $57 thousand to unit based compensation expense for DERs paid in relation to Phantom Units that have been forfeited for the three months ended March 31, 2021 and 2020, respectively.

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SUPPLEMENTAL CASH FLOW INFORMATION (Tables)

3 Months Ended

Mar. 31, 2021

Supplemental Cash Flow Elements [Abstract]

Schedule of supplemental cash flow disclosures

The following table provides supplemental cash flow information for the periods indicated:

	Three Months Ended March 31,
	2021		2020
	(in thousands)
Cash paid for income taxes	$	286	$	317
Cash paid for interest	$	1,549	$	2,083
Cash paid for operating leases	$	1,566	$	1,885

For the three months ended March 31, 2021 and 2020, we had non-cash investing activities for capital expenditures for property and equipment that were financed through “Accounts payable and accrued expenses” as presented in the table below for the periods indicated:

	Three months ended March 31,
	2021		2020
	(in thousands)
Property and equipment financed through accounts payable and accrued expenses	$	136	$	(182)

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NET INCOME (LOSS) PER LIMITED PARTNER INTEREST - Schedule of Distribution Method to Limited and General Partners (Details)	3 Months Ended
	Mar. 31, 2021 $ / shares
USD Partners GP LLC | USD PARTNERS LP | General Partner
Distribution Made to Limited Partner [Line Items]
General partner interest (in percentage)	1.70%
Minimum Quarterly Distribution
Distribution Made to Limited Partner [Line Items]
Percentage Distributed to Limited Partners	98.00%
Percentage distributed to general partner (including IDRs)	2.00%
First Target Distribution
Distribution Made to Limited Partner [Line Items]
Percentage Distributed to Limited Partners	98.00%
Percentage distributed to general partner (including IDRs)	2.00%
Second Target Distribution
Distribution Made to Limited Partner [Line Items]
Percentage Distributed to Limited Partners	85.00%
Percentage distributed to general partner (including IDRs)	15.00%
Third Target Distribution
Distribution Made to Limited Partner [Line Items]
Percentage Distributed to Limited Partners	75.00%
Percentage distributed to general partner (including IDRs)	25.00%
Thereafter
Distribution Made to Limited Partner [Line Items]
Percentage Distributed to Limited Partners	50.00%
Percentage distributed to general partner (including IDRs)	50.00%
General Partner | USD Partners GP LLC | USD PARTNERS LP
Distribution Made to Limited Partner [Line Items]
General partner interest (in percentage)	2.00%
Maximum | Minimum Quarterly Distribution
Distribution Made to Limited Partner [Line Items]
Distribution made to partner, distributions paid, per unit (USD per Share)	$ 0.2875
Maximum | First Target Distribution
Distribution Made to Limited Partner [Line Items]
Distribution made to partner, distributions paid, per unit (USD per Share)	0.330625
Maximum | Second Target Distribution
Distribution Made to Limited Partner [Line Items]
Distribution made to partner, distributions paid, per unit (USD per Share)	0.359375
Maximum | Third Target Distribution
Distribution Made to Limited Partner [Line Items]
Distribution made to partner, distributions paid, per unit (USD per Share)	0.431250
Minimum | First Target Distribution
Distribution Made to Limited Partner [Line Items]
Distribution made to partner, distributions paid, per unit (USD per Share)	0.2875
Minimum | Second Target Distribution
Distribution Made to Limited Partner [Line Items]
Distribution made to partner, distributions paid, per unit (USD per Share)	0.330625
Minimum | Third Target Distribution
Distribution Made to Limited Partner [Line Items]
Distribution made to partner, distributions paid, per unit (USD per Share)	0.359375
Minimum | Thereafter
Distribution Made to Limited Partner [Line Items]
Distribution made to partner, distributions paid, per unit (USD per Share)	$ 0.431250

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NET INCOME (LOSS) PER LIMITED PARTNER INTEREST - Schedule of Earnings Per Share, Basic and Diluted (Details) - USD ($)	1 Months Ended	3 Months Ended
	Feb. 29, 2020	Mar. 31, 2021	Mar. 31, 2020
Limited Partners' Capital Account [Line Items]
Net income (loss) attributable to general and limited partner interests in USD Partners LP		$ 7,328,000	$ (33,781,000)
Less: Distributable earnings		3,303,000	3,183,000
Excess net income		$ 4,025,000	$ (36,964,000)
Weighted average units outstanding (in shares)		27,491,000	27,127,000
Partners share targeted year-to-date distribution amount (USD per share)		$ 0.1135	$ 0.111
Partners' annual distribution amount per share (USD per share)		$ 0.454	$ 0.444
Antidilutive securities excluded from computation of earnings per share, amount (in shares)		1,418,517	1,367,678
Phantom share units (PSUs)
Limited Partners' Capital Account [Line Items]
Equity-classified phantom units		$ 161,000	$ 152,000
Common Units
Limited Partners' Capital Account [Line Items]
Weighted average units outstanding (in shares)		27,030,000	25,516,000
Subordinated Units
Limited Partners' Capital Account [Line Items]
Weighted average units outstanding (in shares)		0	1,150,000
Limited Partner | Common Units
Limited Partners' Capital Account [Line Items]
Net income (loss) attributable to general and limited partner interests in USD Partners LP		$ 7,204,000	$ (33,195,000)
Less: Distributable earnings		3,248,000	3,129,000
Excess net income		$ 3,956,000	$ (36,324,000)
Weighted average units outstanding (in shares)		27,030,000	25,516,000
Distributable earnings per unit (USD per share)		$ 0.12	$ 0.12
Overdistributed earnings per unit (in USD per share)		0.15	(1.42)
Net income (loss) per limited partner unit (basic and diluted) (USD per share)		$ 0.27	$ (1.30)
Equity-classified phantom units		$ 3,129,000	$ 9,464,000
Conversion of units (in units) (in shares)		0	2,092,709
Limited Partner | Subordinated Units
Limited Partners' Capital Account [Line Items]
Net income (loss) attributable to general and limited partner interests in USD Partners LP		$ 0	$ (15,000)
Less: Distributable earnings		0	0
Excess net income		$ 0	$ (15,000)
Weighted average units outstanding (in shares)		0	1,150,000
Distributable earnings per unit (USD per share)		$ 0	$ 0
Overdistributed earnings per unit (in USD per share)		0	(0.01)
Net income (loss) per limited partner unit (basic and diluted) (USD per share)		$ 0	$ (0.01)
Equity-classified phantom units		$ 0	$ 811,000
Conversion of units (in units) (in shares)		0	(2,092,709)
Limited Partner | Subordinated Units | First vesting tranche
Limited Partners' Capital Account [Line Items]
Conversion of units (in units) (in shares)	2,092,709
General Partner
Limited Partners' Capital Account [Line Items]
Net income (loss) attributable to general and limited partner interests in USD Partners LP		$ 124,000	$ (571,000)
Less: Distributable earnings		55,000	54,000
Excess net income		$ 69,000	$ (625,000)
Weighted average units outstanding (in shares)		461,000	461,000
Equity-classified phantom units		$ 54,000	$ 380,000
General Partner | Incentive distribution rights
Limited Partners' Capital Account [Line Items]
Equity-classified phantom units		$ 0	$ 0

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REVENUES (Details)	3 Months Ended
	Mar. 31, 2021 USD ($) segment	Dec. 31, 2020 USD ($)
Disaggregation of Revenue [Line Items]
Number of reportable segments | segment	2
Contract duration	one year or less
Breakage rate (in percentage)	97.00%
Deferred revenue	$ 6,968,000	$ 6,367,000
Estimated breakage bssociated with the make-upright options
Disaggregation of Revenue [Line Items]
Deferred revenue	600,000	0
Related party | Fleet leases
Disaggregation of Revenue [Line Items]
Deferred revenue	$ 400,000	$ 400,000

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REVENUES - Schedule of Geographic Revenues (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Related party
Disaggregation of Revenue [Line Items]
Revenues	$ 2,314	$ 5,299
Third party
Disaggregation of Revenue [Line Items]
Revenues	28,285	24,907
U.S. | Related party
Disaggregation of Revenue [Line Items]
Revenues	2,314	2,305
U.S. | Third party
Disaggregation of Revenue [Line Items]
Revenues	7,638	7,049
Canada | Related party
Disaggregation of Revenue [Line Items]
Revenues	0	2,994
Canada | Third party
Disaggregation of Revenue [Line Items]
Revenues	$ 20,647	$ 17,858

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REVENUES - Schedule of Remaining Performance Obligation (Details) $ in Thousands	Mar. 31, 2021 USD ($)
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Remaining performance obligation	$ 334,893
Exchange rate (USD per CAD)	0.7897
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-04-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Remaining performance obligation	$ 74,411
Expected timing of satisfaction, period	9 months
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-01-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Remaining performance obligation	$ 76,243
Expected timing of satisfaction, period	1 year
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-01-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Remaining performance obligation	$ 37,779
Expected timing of satisfaction, period	1 year
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-01-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Remaining performance obligation	$ 19,528
Expected timing of satisfaction, period	1 year
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2025-01-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Remaining performance obligation	$ 126,932
Expected timing of satisfaction, period	0 years
Terminalling services
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Remaining performance obligation	$ 333,016
Terminalling services | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-04-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Remaining performance obligation	$ 73,729
Expected timing of satisfaction, period	9 months
Terminalling services | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-01-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Remaining performance obligation	$ 75,048
Expected timing of satisfaction, period	1 year
Terminalling services | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-01-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Remaining performance obligation	$ 37,779
Expected timing of satisfaction, period	1 year
Terminalling services | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-01-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Remaining performance obligation	$ 19,528
Expected timing of satisfaction, period	1 year
Terminalling services | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2025-01-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Remaining performance obligation	$ 126,932
Expected timing of satisfaction, period	0 years
Fleet services
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Remaining performance obligation	$ 1,877
Fleet services | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-04-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Remaining performance obligation	$ 682
Expected timing of satisfaction, period	9 months
Fleet services | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-01-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Remaining performance obligation	$ 1,195
Expected timing of satisfaction, period	1 year
Fleet services | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-01-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Remaining performance obligation	$ 0
Expected timing of satisfaction, period	1 year
Fleet services | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-01-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Remaining performance obligation	$ 0
Expected timing of satisfaction, period	1 year
Fleet services | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2025-01-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Remaining performance obligation	$ 0
Expected timing of satisfaction, period	0 years

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REVENUES - Schedule of Contract Assets (Details) - USD ($) $ in Thousands	Mar. 31, 2021	Dec. 31, 2020
Revenue from Contract with Customer [Abstract]
Other current assets	$ 897	$ 1,622

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REVENUES - Schedule of Change in Customer Liability (Details)	3 Months Ended
	Mar. 31, 2021 USD ($)
Change In Contract With Customer Liability [Roll Forward]
Deferred revenue, beginning of the period	$ 6,367,000
Cash Additions for Customer Prepayments	6,968,000
Revenue Recognized	(6,367,000)
Deferred revenue, end of the period	6,968,000
Estimated breakage bssociated with the make-upright options
Change In Contract With Customer Liability [Roll Forward]
Deferred revenue, beginning of the period	0
Deferred revenue, end of the period	600,000
Other current liabilities
Change In Contract With Customer Liability [Roll Forward]
Contract with customer, liability beginning of the period	0
Cash Additions for Customer Prepayments	704,000
Revenue Recognized	0
Contract with customer, liability end of the period	704,000
Other non-current liabilities
Change In Contract With Customer Liability [Roll Forward]
Contract with customer, liability beginning of the period	10,087,000
Cash Additions for Customer Prepayments	781,000
Revenue Recognized	0
Contract with customer, liability end of the period	10,868,000
Third party
Change In Contract With Customer Liability [Roll Forward]
Effect of exchange rate on contract with customer liability	$ 121,000

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RESTRICTED CASH (Details) - USD ($) $ in Thousands	Mar. 31, 2021	Dec. 31, 2020	Mar. 31, 2020	Dec. 31, 2019
Cash and Cash Equivalents [Abstract]
Cash and cash equivalents	$ 3,066	$ 3,040	$ 4,622
Restricted Cash	7,955	7,954	8,200
Total cash, cash equivalents and restricted cash	$ 11,021	$ 10,994	$ 12,822	$ 10,684

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PROPERTY AND EQUIPMENT - Schedule of Property and Equipment (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2021	Dec. 31, 2020
Property, Plant and Equipment [Line Items]
Total property and equipment	$ 188,724	$ 187,828
Accumulated depreciation	(51,249)	(48,630)
Construction in progress	1,256	643
Property and equipment, net	138,731	139,841
Land
Property, Plant and Equipment [Line Items]
Total property and equipment	10,324	10,288
Trackage and facilities
Property, Plant and Equipment [Line Items]
Total property and equipment	$ 128,189	127,401
Trackage and facilities | Minimum
Property, Plant and Equipment [Line Items]
Property plant and equipment, useful life	10 years
Trackage and facilities | Maximum
Property, Plant and Equipment [Line Items]
Property plant and equipment, useful life	30 years
Pipeline
Property, Plant and Equipment [Line Items]
Total property and equipment	$ 32,735	32,735
Pipeline | Minimum
Property, Plant and Equipment [Line Items]
Property plant and equipment, useful life	20 years
Pipeline | Maximum
Property, Plant and Equipment [Line Items]
Property plant and equipment, useful life	30 years
Equipment
Property, Plant and Equipment [Line Items]
Total property and equipment	$ 17,409	17,337
Equipment | Minimum
Property, Plant and Equipment [Line Items]
Property plant and equipment, useful life	3 years
Equipment | Maximum
Property, Plant and Equipment [Line Items]
Property plant and equipment, useful life	20 years
Furniture
Property, Plant and Equipment [Line Items]
Total property and equipment	$ 67	$ 67
Furniture | Minimum
Property, Plant and Equipment [Line Items]
Property plant and equipment, useful life	5 years
Furniture | Maximum
Property, Plant and Equipment [Line Items]
Property plant and equipment, useful life	10 years

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PROPERTY AND EQUIPMENT - Narrative (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Property, Plant and Equipment [Abstract]
Depreciation and amortization	$ 2.3	$ 2.3

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LEASES - Lease Cost (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Leases [Abstract]
Weighted average discount rate (in percentage)	5.80%
Weighted average remaining lease term in years	1 year 7 months 24 days
Operating lease cost	$ 1,479	$ 1,486
Short term lease cost	44	45
Variable lease cost	18	9
Sublease income	(1,348)	(1,341)
Total	$ 193	$ 199

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LEASES - Future payments (Details) $ in Thousands	Mar. 31, 2021 USD ($)
Leases [Abstract]
2021	$ 4,179
2022	4,520
2023	35
2024	2
Total lease payments	8,736
Less: imputed interest	(428)
Present value of lease liabilities	$ 8,308

XML

LEASES - Lease Income Information (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Lessee, Lease, Description [Line Items]
Lease income	$ 2,185	$ 2,186
Weighted average remaining lease term in years	1 year 6 months 29 days
Terminalling services
Lessee, Lease, Description [Line Items]
Revenue from contract with a customer excluding assessed tax	$ 28,105	24,235
Terminalling services | Crude oil storage tanks
Lessee, Lease, Description [Line Items]
Revenue from contract with a customer excluding assessed tax	$ 1,200	$ 1,200

XML

LEASES - Future Lease Income (Details) $ in Thousands	Mar. 31, 2021 USD ($)
Leases [Abstract]
2021	$ 6,142
2022	5,367
Total	$ 11,509

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INTANGIBLE ASSETS - Intangible Assets (Details) - USD ($) $ in Thousands	Mar. 31, 2021	Dec. 31, 2020
Carrying amount:
Total carrying amount	$ 126,066	$ 126,066
Accumulated amortization:
Total accumulated amortization	(67,725)	(64,574)
Total intangible assets, net	58,341	61,492
Customer service agreements
Carrying amount:
Total carrying amount	125,960	125,960
Accumulated amortization:
Total accumulated amortization	(67,669)	(64,520)
Other
Carrying amount:
Total carrying amount	106	106
Accumulated amortization:
Total accumulated amortization	$ (56)	$ (54)

XML

INTANGIBLE ASSETS - Narrative (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Goodwill and Intangible Assets Disclosure [Abstract]
Amortization of intangible assets	$ 3.2	$ 3.2

XML

DEBT - Narrative (Details) - Credit Facility - Secured Debt	3 Months Ended	12 Months Ended
	Mar. 31, 2021 USD ($) matuirty_date_extension	Dec. 31, 2020 USD ($)
Line of Credit Facility [Line Items]
Maximum borrowing capacity	$ 385,000,000.0	$ 385,000,000.0
Term of agreement	4 years
Number of maturity date extensions | matuirty_date_extension	2
Period of extension of maturity date	1 year
Revolving Credit Facility
Line of Credit Facility [Line Items]
Maximum borrowing capacity	$ 385,000,000
Line of credit facility, accordion feature, higher borrowing capacity option	$ 500,000,000
Average interest rate (in percentage)	2.62%	2.66%
Commitment fee percentage (in percentage)	0.50%
Standby Letters of Credit
Line of Credit Facility [Line Items]
Maximum borrowing capacity	$ 20,000,000
Swingline Sub-facility
Line of Credit Facility [Line Items]
Maximum borrowing capacity	$ 20,000,000

XML

DEBT - Schedule of Long-term Debt (Details) - USD ($) $ in Thousands	Mar. 31, 2021	Dec. 31, 2020
Debt Instrument [Line Items]
Total long-term debt, net	$ 187,688	$ 195,480
Secured Debt | Credit Facility
Debt Instrument [Line Items]
Less: Deferred financing costs, net	(1,312)	(1,520)
Revolving Credit Facility | Secured Debt | Credit Facility
Debt Instrument [Line Items]
Revolving Credit Facility	$ 189,000	$ 197,000

XML

DEBT - Schedule of Line of Credit Facilities (Details) - Secured Debt - Credit Facility	3 Months Ended
	Mar. 31, 2021 USD ($)	Dec. 31, 2020 USD ($)
Line of Credit Facility [Line Items]
Aggregate borrowing capacity under Credit Agreement	$ 385,000,000.0	$ 385,000,000.0
Available under the Credit Agreement based on capacity	196,000,000.0	188,000,000.0
EBITDA multiple cap	$ 71,400,000	53,200,000
Borrowing capacity limit multiple of EBITDA	4.5
Revolving Credit Facility
Line of Credit Facility [Line Items]
Aggregate borrowing capacity under Credit Agreement	$ 385,000,000
Less: Revolving Credit Facility amounts outstanding	$ 189,000,000.0	$ 197,000,000.0

XML

DEBT - Schedule of Interest Expense, Net (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Debt Disclosure [Abstract]
Interest expense on the Credit Agreement	$ 1,528	$ 2,532
Amortization of deferred financing costs	207	207
Total interest expense	$ 1,735	$ 2,739

XML

COLLABORATIVE ARRANGEMENT (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020	Dec. 31, 2020
Disaggregation of Revenue [Line Items]
Other current liabilities	$ 4,407		$ 4,222
Facilities Agreement with Gibson
Disaggregation of Revenue [Line Items]
Other current liabilities	1,700		2,300
Other noncurrent assets	3,000		$ 2,900
Pipeline fees
Disaggregation of Revenue [Line Items]
Operating costs	$ 6,046	$ 6,347

XML

NONCONSOLIDATED VARIABLE INTEREST ENTITIES (Details) - USD ($) $ in Thousands	Mar. 31, 2021	Dec. 31, 2020
Variable Interest Entity [Line Items]
Assets	$ 232,730	$ 237,548
Liabilities	$ 221,374	231,280
Variable interest entity, not primary beneficiary
Variable Interest Entity [Line Items]
Assets		43
Liabilities		10
Maximum exposure to loss		33
Accounts receivable | Variable interest entity, not primary beneficiary
Variable Interest Entity [Line Items]
Assets		43
Liabilities		0
Maximum exposure to loss		33
Deferred revenue | Variable interest entity, not primary beneficiary
Variable Interest Entity [Line Items]
Assets		0
Liabilities		10
Maximum exposure to loss		$ 0

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TRANSACTIONS WITH RELATED PARTIES - Narrative (Details)	1 Months Ended	3 Months Ended		6 Months Ended
	Jan. 31, 2019 railcar	Mar. 31, 2021 USD ($) barrel railcar shares	Mar. 31, 2020 USD ($) shares	Jun. 30, 2020	Dec. 31, 2020 USD ($) shares	Dec. 31, 2019 shares
Related Party Transaction [Line Items]
Amount of transloading capacity per day per unit train | railcar		120
Number of barrels of takeaway capacity per day | barrel		112,500
Selling, general and administrative costs		$ 4,733,000	$ 5,173,000
Accounts payable and accrued expenses — related party		359,000			$ 383,000
Other non-current assets — related party		2,138,000			1,706,000
Percentage of control of terminal capacity				25.00%
Related party
Related Party Transaction [Line Items]
Selling, general and administrative costs		1,677,000	1,993,000
USDG | Omnibus Agreement | Limited Partner
Related Party Transaction [Line Items]
Selling, general and administrative costs		1,700,000	2,000,000.0
Accounts payable and accrued expenses — related party		300,000
USD Terminal Canada II | Hardisty Terminal Services Agreement | Related party
Related Party Transaction [Line Items]
Operating and maintenance		$ 2,100,000	$ 2,000,000.0
Other non-current assets — related party					$ 1,700,000
USDM | Marketing Services Agreement | Subsidiaries
Related Party Transaction [Line Items]
Agreement term	6 months
Automatic renewal period	6 months
Number of railcars leased | railcar	200
USDG | Limited Partner | USD PARTNERS LP
Related Party Transaction [Line Items]
Limited partner interest (in percentage)		41.70%
USD Partners GP LLC | General Partner | USD PARTNERS LP
Related Party Transaction [Line Items]
General partner interest (in percentage)		1.70%
General Partner
Related Party Transaction [Line Items]
Partners' capital account (in units) (in shares) | shares		461,136	461,136		461,136	461,136
General Partner | USD Partners GP LLC
Related Party Transaction [Line Items]
Partners' capital account (in units) (in shares) | shares		461,136
General Partner | USD Partners GP LLC | USD PARTNERS LP
Related Party Transaction [Line Items]
General partner interest (in percentage)		2.00%
Common Units | Limited Partner
Related Party Transaction [Line Items]
Partners' capital account (in units) (in shares) | shares		27,224,441	26,843,674		26,844,715	24,411,892
Common Units | Limited Partner | USDG
Related Party Transaction [Line Items]
Partners' capital account (in units) (in shares) | shares		11,557,090
Units pledged as collateral (in units) (in shares) | shares		10,000,000.0

XML

TRANSACTIONS WITH RELATED PARTIES - Schedule of Deferred Revenue, Current Portion - Related Party (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020	Dec. 31, 2020
Related Party Transaction [Line Items]
Accounts receivable — related party	$ 2,569		$ 2,460
Other non-current liabilities — related party	4		0
Terminalling and Fleets Services Agreements
Related Party Transaction [Line Items]
Other non-current liabilities — related party	4		0
Lease revenues | Terminalling and Fleets Services Agreements
Related Party Transaction [Line Items]
Other current and non-current assets — related party	2,138		1,721
Customer prepayments, current position | Terminalling and Fleets Services Agreements
Related Party Transaction [Line Items]
Deferred revenue— related party	410		410
USD Marketing | Related party
Related Party Transaction [Line Items]
Related party	2,314	$ 5,299
USD Marketing | Terminalling services — related party | Related party
Related Party Transaction [Line Items]
Related party	1,103	4,088
USD Marketing | Fleet leases — related party | Related party
Related Party Transaction [Line Items]
Related party	984	984
USD Marketing | Fleet services — related party | Related party
Related Party Transaction [Line Items]
Related party	227	$ 227
USD Marketing | Lease revenues | Terminalling and Fleets Services Agreements
Related Party Transaction [Line Items]
Accounts receivable — related party	2,569		2,460
Accounts payable and accrued expenses — related party	$ 65		$ 64

XML

TRANSACTIONS WITH RELATED PARTIES - Schedule of Cash Distributions (Details) $ in Thousands	Feb. 19, 2021 USD ($)
USDG
Related Party Transaction [Line Items]
Amount Paid to USDG	$ 1,283
USD Group LLC
Related Party Transaction [Line Items]
Amount Paid to USD Partners GP LLC	$ 51

XML

SEGMENT REPORTING - Narrative (Details)	3 Months Ended
	Mar. 31, 2021 segment
Segment Reporting [Abstract]
Number of reportable segments	2

XML

SEGMENT REPORTING - Summary of Reportable Segment Data for Continuing Operations (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Revenues
Fleet leases	$ 2,185	$ 2,186
Total revenues	30,599	30,206
Operating costs
Operating and maintenance — related party	4,922	5,108
Selling, general and administrative — related party	4,733	5,173
Goodwill impairment loss	0	33,589
Depreciation and amortization	5,471	5,422
Total operating costs	24,469	59,706
Operating income (loss)	6,130	(29,500)
Interest expense	1,735	2,739
Loss (gain) associated with derivative instruments	(3,076)	2,873
Foreign currency transaction gain	(61)	(92)
Other income, net	(20)	(732)
Provision for (benefit from) income taxes	224	(507)
Net income (loss)	7,328	(33,781)
Related party
Revenues
Revenues	2,314	5,299
Fleet leases	984	984
Operating costs
Operating and maintenance — related party	2,090	2,027
Selling, general and administrative — related party	1,677	1,993
Operating Segments | Terminalling services
Revenues
Total revenues	29,332	28,940
Operating costs
Operating and maintenance — related party	3,924	4,088
Selling, general and administrative — related party	1,019	1,723
Goodwill impairment loss	0	33,589
Depreciation and amortization	5,471	5,422
Total operating costs	19,725	55,231
Operating income (loss)	9,607	(26,291)
Interest expense	0	0
Loss (gain) associated with derivative instruments	0	0
Foreign currency transaction gain	133	(74)
Other income, net	(20)	(729)
Provision for (benefit from) income taxes	197	(47)
Net income (loss)	9,297	(25,441)
Operating Segments | Terminalling services | Related party
Revenues
Fleet leases		0
Operating Segments | Fleet services
Revenues
Total revenues	1,267	1,266
Operating costs
Operating and maintenance — related party	998	1,020
Selling, general and administrative — related party	92	313
Goodwill impairment loss	0	0
Depreciation and amortization	0	0
Total operating costs	1,122	1,338
Operating income (loss)	145	(72)
Interest expense	0	0
Loss (gain) associated with derivative instruments	0	0
Foreign currency transaction gain	0	(6)
Other income, net	0	0
Provision for (benefit from) income taxes	27	(460)
Net income (loss)	118	394
Operating Segments | Fleet services | Related party
Revenues
Fleet leases	984	984
Corporate
Revenues
Total revenues	0	0
Operating costs
Operating and maintenance — related party	0	0
Selling, general and administrative — related party	3,622	3,137
Goodwill impairment loss	0	0
Depreciation and amortization	0	0
Total operating costs	3,622	3,137
Operating income (loss)	(3,622)	(3,137)
Interest expense	1,735	2,739
Loss (gain) associated with derivative instruments	(3,076)	2,873
Foreign currency transaction gain	(194)	(12)
Other income, net	0	(3)
Provision for (benefit from) income taxes	0	0
Net income (loss)	(2,087)	(8,734)
Corporate | Related party
Revenues
Fleet leases	0	0
Terminalling services
Revenues
Revenues	28,105	24,235
Terminalling services | Related party
Revenues
Revenues	1,103	4,088
Terminalling services | Operating Segments | Terminalling services
Revenues
Revenues	28,105	24,235
Terminalling services | Operating Segments | Terminalling services | Related party
Revenues
Revenues	1,103	4,088
Terminalling services | Corporate
Revenues
Revenues	0	0
Terminalling services | Corporate | Related party
Revenues
Revenues	0	0
Fleet services
Revenues
Revenues	24	50
Fleet services | Related party
Revenues
Revenues	227	227
Fleet services | Operating Segments | Fleet services
Revenues
Revenues	24	50
Fleet services | Operating Segments | Fleet services | Related party
Revenues
Revenues	227	227
Fleet services | Corporate
Revenues
Revenues	0	0
Fleet services | Corporate | Related party
Revenues
Revenues	0	0
Freight and other reimbursables
Revenues
Revenues	156	622
Operating costs
Operating costs	156	622
Freight and other reimbursables | Operating Segments | Terminalling services
Revenues
Revenues	124	617
Operating costs
Operating costs	124	617
Freight and other reimbursables | Operating Segments | Fleet services
Revenues
Revenues	32	5
Operating costs
Operating costs	32	5
Freight and other reimbursables | Corporate
Revenues
Revenues	0	0
Operating costs
Operating costs	0	0
Subcontracted rail services
Operating costs
Operating costs	3,141	3,445
Subcontracted rail services | Operating Segments | Terminalling services
Operating costs
Operating costs	3,141	3,445
Subcontracted rail services | Operating Segments | Fleet services
Operating costs
Operating costs	0	0
Subcontracted rail services | Corporate
Operating costs
Operating costs	0	0
Pipeline fees
Operating costs
Operating costs	6,046	6,347
Pipeline fees | Operating Segments | Terminalling services
Operating costs
Operating costs	6,046	6,347
Pipeline fees | Operating Segments | Fleet services
Operating costs
Operating costs	0	0
Pipeline fees | Corporate
Operating costs
Operating costs	$ 0	$ 0

XML

SEGMENT REPORTING - Reconciliation of Adjusted EBITDA to Loss from Continuing Operations (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Segment Reporting Information [Line Items]
Net income (loss)	$ 7,328	$ (33,781)
Depreciation and amortization	5,471	5,422
Provision for (benefit from) income taxes	224	(507)
Foreign currency transaction loss (gain)	(61)	(92)
Goodwill impairment loss	0	33,589
Operating Segments | Terminalling services
Segment Reporting Information [Line Items]
Net income (loss)	9,297	(25,441)
Interest income	(1)	(21)
Depreciation and amortization	5,471	5,422
Provision for (benefit from) income taxes	197	(47)
Foreign currency transaction loss (gain)	133	(74)
Goodwill impairment loss	0	33,589
Non-cash deferred amounts	1,683	437
Segment Adjusted EBITDA	16,780	13,865
Operating Segments | Fleet services
Segment Reporting Information [Line Items]
Net income (loss)	118	394
Depreciation and amortization	0	0
Provision for (benefit from) income taxes	27	(460)
Foreign currency transaction loss (gain)	0	(6)
Goodwill impairment loss	0	0
Segment Adjusted EBITDA	$ 145	$ (72)

XML

DERIVATIVE FINANCIAL INSTRUMENTS - Narrative (Details) - USD ($)	1 Months Ended
	Nov. 30, 2017	Sep. 30, 2020	Mar. 31, 2020
Interest Rate Collar
Derivative [Line Items]
Derivative, term of contract	5 years
Notional amount	$ 100,000,000
Derivative, floor interest rate (in percentage)	1.70%
Derivative, cap interest rate (in percentage)	2.50%
Swap maturing August 2025
Derivative [Line Items]
Notional amount		$ 150,000,000	$ 150,000,000
Derivative, fixed interest rate		0.84%	0.84%

XML

DERIVATIVE FINANCIAL INSTRUMENTS - Derivative Positions Included in the Consolidated Balance Sheets at Fair Value (Details) - USD ($) $ in Thousands	Mar. 31, 2021	Dec. 31, 2020
Derivative [Line Items]
Fair Value	$ (490)	$ (3,829)
Other non-current assets
Derivative [Line Items]
Fair Value	577	0
Other current liabilities
Derivative [Line Items]
Fair Value	(1,067)	(1,086)
Other non-current liabilities
Derivative [Line Items]
Fair Value	$ 0	$ (2,743)

XML

DERIVATIVE FINANCIAL INSTRUMENTS - Gain (Loss) on Derivative Instruments (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Derivative Instruments and Hedging Activities Disclosure [Abstract]
Loss (gain) associated with derivative instruments	$ (3,076)	$ 2,873

XML

DERIVATIVE FINANCIAL INSTRUMENTS - Summary of Fair Values of Outstanding Foreign Currency Options (Details) - USD ($)	Mar. 31, 2021	Dec. 31, 2020	Sep. 30, 2020	Mar. 31, 2020
Derivative [Line Items]
Fair Value	$ (490,000)	$ (3,829,000)
Swap maturing August 2025
Derivative [Line Items]
Notional amount			$ 150,000,000	$ 150,000,000
Derivative, fixed interest rate			0.84%	0.84%
Fair Value	$ (490,000)	$ (3,829,000)

XML

PARTNERS' CAPITAL (Details)	1 Months Ended	3 Months Ended
	Feb. 29, 2020 shares	Mar. 31, 2021 quarter $ / shares shares	Mar. 31, 2020 $ / shares shares
Limited Partners' Capital Account [Line Items]
Targeted annual distribution amount (USD per share) | $ / shares		$ 1.15
Targeted quarterly distribution (USD per share) | $ / shares		0.2875
Partners share targeted year-to-date distribution amount (USD per share) | $ / shares		$ 0.1135	$ 0.111
Limited Partner | Common Units
Limited Partners' Capital Account [Line Items]
Conversion of units (in units) (in shares)		0	2,092,709
Limited Partner | Subordinated Units
Limited Partners' Capital Account [Line Items]
Conversion of units (in units) (in shares)		0	(2,092,709)
First vesting tranche | Limited Partner | Subordinated Units
Limited Partners' Capital Account [Line Items]
Conversion ratio		1
Conversion on units (in percentage)		20.00%
Minimum period to elapse before eligibility of conversion of units		12 months
Number of quarters distributions paid for | quarter		4
Conversion of units (in units) (in shares)	2,092,709
LTIP | First vesting tranche | Limited Partner | Common Units
Limited Partners' Capital Account [Line Items]
Conversion of units (in units) (in shares)		379,726
Phantom share units (PSUs) | LTIP
Limited Partners' Capital Account [Line Items]
Conversion ratio		1
Phantom share units (PSUs) | LTIP | First vesting tranche | Limited Partner
Limited Partners' Capital Account [Line Items]
Shares vested (in shares)		557,579
Units retained (in shares)		177,853

XML

UNIT BASED COMPENSATION - Narrative (Details) - Phantom share units (PSUs) $ in Millions	3 Months Ended		12 Months Ended
	Mar. 31, 2021 USD ($) shares	Mar. 31, 2020 USD ($)	Dec. 31, 2020 shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Award vesting period	4 years
Allocated share-based compensation expense | $	$ 1.5	$ 1.6
Unit based compensation expense, unrecognized | $	$ 11.6
Weighted average recognition period	2 years 7 months 20 days
Director
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Award vesting period	1 year
LTIP
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Approved for grant (in units) (in shares) | shares	667,543		694,140
Share remaining available (in units) (in shares) | shares	501,448
Conversion ratio	1

XML

UNIT BASED COMPENSATION - Long-term Incentive Plan (Details) - LTIP - $ / shares	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Phantom Share Units (PSU) Equity Classified
Weighted-Average Grant Date Fair Value Per Phantom Unit
Grant date average fair value, beginning of period (USD per share)	$ 10.98	$ 11.34
Granted (USD per share)	4.82	10.15
Vested (USD per share)	11.33	10.84
Forfeited (USD per share)	8.44	11.08
Grant date average fair value, end of period (USD per share)	8.18	10.98
Phantom Share Units (PSU) Liability Classified
Weighted-Average Grant Date Fair Value Per Phantom Unit
Grant date average fair value, beginning of period (USD per share)	10.58	11.53
Granted (USD per share)	4.82	10.15
Vested (USD per share)	10.15	11.37
Grant date average fair value, end of period (USD per share)	$ 7.88	$ 10.76
Director and Independent Consultant Phantom Units | Phantom Share Units (PSU) Equity Classified
Number of units
Phantom Units, beginning of period (in shares)	40,065	37,139
Granted (in shares)	40,065	40,065
Vested (in shares)	(40,065)	(37,139)
Forfeited (in shares)	0	0
Phantom Units, end of period (in shares)	40,065	40,065
Director and Independent Consultant Phantom Units | Phantom Share Units (PSU) Liability Classified
Number of units
Phantom Units, beginning of period (in shares)	13,136	12,177
Granted (in shares)	13,136	13,136
Vested (in shares)	(13,136)	(12,177)
Phantom Units, end of period (in shares)	13,136	13,136
Employee Phantom Units | Phantom Share Units (PSU) Equity Classified
Number of units
Phantom Units, beginning of period (in shares)	1,324,837	1,252,544
Granted (in shares)	573,204	594,912
Vested (in shares)	(517,514)	(481,336)
Forfeited (in shares)	(2,075)	(38,507)
Phantom Units, end of period (in shares)	1,378,452	1,327,613
Employee Phantom Units | Phantom Share Units (PSU) Liability Classified
Number of units
Phantom Units, beginning of period (in shares)	59,284	44,620
Granted (in shares)	41,138	46,027
Vested (in shares)	0	0
Phantom Units, end of period (in shares)	100,422	90,647

XML

UNIT BASED COMPENSATION - Phantom Units Pursuant to Associated DERs (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Distribution Equivalent Right
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Equity-classified phantom units	$ 152	$ 477
Liability-classified Phantom Units	8	21
Total	160	498
Phantom share units (PSUs)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Equity-classified phantom units	161	152
Share-based compensation, forfeited	$ 2	$ 57

XML

SUPPLEMENTAL CASH FLOW INFORMATION - Schedule of Supplemental Cash Flow Disclosures (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020	Dec. 31, 2020
Lessee, Lease, Description [Line Items]
Cash paid for income taxes	$ 286	$ 317
Cash paid for interest	1,549	2,083
Cash paid for operating leases	1,566	1,885
Property and equipment financed through accounts payable and accrued expenses	136	(182)
Operating lease right-of-use assets	8,320		$ 9,630
Present value of lease liabilities	8,308
New Or Extended Lease Agreements
Lessee, Lease, Description [Line Items]
Operating lease right-of-use assets	37	2,800
Present value of lease liabilities	$ 37	$ 2,800

XML

SUBSEQUENT EVENTS (Details) - USD ($)			1 Months Ended	3 Months Ended
	May 14, 2021	Apr. 22, 2021	May 06, 2021	Mar. 31, 2021	Mar. 31, 2020	May 03, 2021	Dec. 31, 2020
Subsequent Event [Line Items]
Partners share targeted year-to-date distribution amount (USD per share)				$ 0.1135	$ 0.111
Targeted annual distribution amount (USD per share)				$ 1.15
Long-term Debt				$ 187,688,000			$ 195,480,000
Credit Facility | Secured Debt
Subsequent Event [Line Items]
Maximum borrowing capacity				385,000,000.0			385,000,000.0
Available under the Credit Agreement based on capacity				196,000,000.0			$ 188,000,000.0
Credit Facility | Secured Debt | Revolving Credit Facility
Subsequent Event [Line Items]
Maximum borrowing capacity				$ 385,000,000
Scenario, Forecast | Common Units
Subsequent Event [Line Items]
Distributions, limited partner	$ 1,800,000
Scenario, Forecast | USDG | Common Units and Subordinated Units
Subsequent Event [Line Items]
Distributions, limited partner	1,300,000
Scenario, Forecast | USD Partners GP LLC
Subsequent Event [Line Items]
Distributions, general partner	$ 52,000
Subsequent Event
Subsequent Event [Line Items]
Partners share targeted year-to-date distribution amount (USD per share)		$ 0.1135
Subsequent Event | Credit Facility | Secured Debt | Revolving Credit Facility
Subsequent Event [Line Items]
Repayments of lines of credit			$ 3,000,000.0
Long-term Debt						$ 186,000,000.0
Available under the Credit Agreement based on capacity						$ 199,000,000.0
Subsequent Event | Common Units
Subsequent Event [Line Items]
Targeted annual distribution amount (USD per share)		$ 0.454