REVENUE RECOGNITION

6 Months Ended

Jun. 30, 2020

Revenue from Contract with Customer [Abstract]

REVENUE RECOGNITION

REVENUE RECOGNITION

Revenue Recognition

The following table presents a disaggregation of the Company’s midstream services revenue by service type.

	Three Months Ended June 30,				Six Months Ended June 30,
	2020		2019		2020		2019
	(In thousands)
MIDSTREAM SERVICES REVENUE — AFFILIATE:
Gas gathering and compression	$	4,394	$	2,697	$	10,114	$	6,310
Gas processing	23,184		18,395		53,080		43,679
Transmission	3,226		2,977		7,401		7,831
NGL transmission	587		70		1,413		165
Other	225		—		375		—
	$	31,616	$	24,139	$	72,383	$	57,985

The Company generates revenue from its contracts with customers for the gathering, compression, processing, and transmission of natural gas and NGLs in exchange for a fee per unit of volumes processed during a given month. For all periods presented, revenues with affiliates recorded on the Company’s consolidated statement of operations were attributable to services performed by Altus Midstream for Apache pursuant to separate long-term commercial midstream agreements comprising acreage dedications in Apache’s entire Alpine High resource play.

As part of these agreements, substantially all of Apache’s natural gas production from its existing and future owned or controlled properties within the dedicated area is provided to the Company, so long as Apache has the right to market such product. There are no provisions for minimum volume commitments under the existing agreements, and the Company does not own or take title to the volumes it services under these agreements. Altus Midstream, in return for its performance, receives a fee per unit of natural gas or NGLs received during a given month. The service fee charged per unit is set forth for each contract year, subject to yearly fee escalation recalculations.

Providing the related service on each volumetric unit represents a single, distinct performance obligation that is satisfied over time as services are rendered. As the amount of volumes serviced are not subject to minimum commitments and each midstream service agreement contains provisions for fee recalculations, substantially all of the transaction price is variable at inception of each contract term. Revenue is measured using the output method based on the amount of volumes serviced each month and the applicable service fee and recognized over time in the amount to which Altus Midstream has the right to invoice, as performance completed to date corresponds directly with the value to its customers. The transaction price is not constrained as variability is resolved prior to the recognition of revenue.

Payment under the midstream service agreements are due the month immediately following the month of service. Amounts settled with Apache each month are based on the net amount owed to Altus Midstream or owed to Apache. Revenue receivables from the Company’s contracts with Apache totaled $13.6 million and $15.5 million as of June 30, 2020 and December 31, 2019, respectively, as presented on the Company’s consolidated balance sheet.

In accordance with the provisions of ASC Topic 606, “Revenue from Contracts with Customers,” a variable transaction price for each short-term sale is allocated to each performance obligation as the terms of payment relate specifically to the Company’s efforts to satisfy its obligations. As such, the Company has elected the practical expedients available under the standard to not disclose the aggregate transaction price allocated to unsatisfied, or partially unsatisfied, performance obligations as of the end of the reporting period.