JOINT VENTURE EQUITY INTEREST

12 Months Ended

Dec. 31, 2018

Equity Method Investments and Joint Ventures [Abstract]

Joint Venture Equity Interest

JOINT VENTURE EQUITY INTEREST

In December 2018, Altus Midstream exercised its option to acquire a 15 percent equity interest in Gulf Coast Express Pipeline LLC (“GCX LLC”), a Delaware limited liability company for total cash consideration of approximately $91.1 million. GCX LLC is involved in the construction of a long-haul natural gas pipeline that, upon completion, is expected to have capacity of approximately 2.0 Bcf/d and will transport natural gas from the Waha area in northern Pecos County, Texas to the Agua Dulce Hub near the Texas Gulf Coast. The pipeline is expected to be operational and in-service in the fourth quarter of 2019. Upon exercising the GCX LLC option, the Company has estimated it will incur an additional $175.3 million of capital contributions in 2019 for its equity share associated with the remaining construction costs.

GCX LLC maintains separate accounts for each member to which each member’s share of profits and losses, contributions and distributions are directly allocated. Certain business decisions, including, but not limited to, approval of annual budgets and decisions with respect to significant expenditures and activities, contractual commitments, material financings and legal proceedings, require more than 50 percent approval of the members.

The joint venture equity interest balance at December 31, 2018, is $5.8 million less than Altus’ underlying equity in GCX LLC’s net assets. This balance will be amortized over the estimated useful life of the pipeline, when placed into service.