Leases

12 Months Ended

Dec. 31, 2021

Leases [Abstract]

Lessee, Operating Leases

LEASES

We have operating leases for some of our transportation equipment, office space, warehouse space, operating locations, and machinery and equipment. We have finance leases for certain facility storage tanks and equipment rentals. These finance leases are not material to our financial statements. Our leases have remaining lease terms ranging from 1 to 13 years. Some of our leases have options to extend for various periods, while some have termination options with prior notice of generally 30 days or six months. The office space, warehouse space, operating location leases, and machinery and equipment leases generally require us to pay all maintenance and insurance costs.

Our corporate headquarters facility located in The Woodlands, Texas, was sold on December 31, 2012, pursuant to a sale and leaseback transaction. As a condition to the completion of the purchase and sale of the facility, the parties entered into a lease agreement for the facility having an initial lease term of 15 years, which is classified as an operating lease. Under the terms of the lease agreement, we have the ability to extend the lease for five successive five-year periods at base rental rates to be determined at the time of each extension.

Components of lease expense, included in either cost of revenues or general and administrative expense based on the use of the underlying asset, are as follows (inclusive of lease expense for leases not included on our consolidated balance sheet based on our accounting policy election to exclude leases with a term of 12 months or less):

	Year Ended December 31,
	2021		2020		2019
	(In Thousands)
Operating lease expense	$	12,905	$	13,946	$	15,131
Short-term lease expense	22,055		17,125		36,348
Total lease expense	$	34,960	$	31,071	$	51,479

For the years ended December 31, 2021, 2020 and 2019, we recognized sublease income of $1.0 million. Variable rent expense was not material. At December 31, 2021, future minimum rental receipts under non-cancelable subleases for office space in two of our locations totaled $5.1 million.

Supplemental cash flow information:

	Year Ended December 31,
	2021		2020		2019
	(In Thousands)
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows - operating leases	$	12,962	$	13,612	$	15,064
Right-of-use assets obtained in exchange for lease obligations:
Operating leases	$	3,168	$	5,612	$	3,944

Supplemental balance sheet information:

	December 31, 2021		December 31, 2020
	(In Thousands)
Operating leases:
Operating lease right-of-use assets	$	36,973	$	43,448
Operating lease liabilities, current portion	$	8,108	$	8,795
Operating lease liabilities	$	31,429	$	37,569
Total operating lease liabilities	$	39,537	$	46,364

Additional operating lease information:

	December 31, 2021		December 31, 2020
Weighted average remaining lease term:
Operating leases	6.4 years		6.8 years
Weighted average discount rate:
Operating leases	9.67	%	9.62	%

Future minimum lease payments by year and in the aggregate, under non-cancelable operating leases with terms in excess of one year consist of the following at December 31, 2021:

	Operating Leases
	(In Thousands)
2022	$	11,507
2023	9,241
2024	7,412
2025	5,721
2026	5,635
Thereafter	13,867
Total lease payments	53,383
Less imputed interest	(13,846)
Total lease liabilities	$	39,537

Lessee, Finance Leases

LEASES

We have operating leases for some of our transportation equipment, office space, warehouse space, operating locations, and machinery and equipment. We have finance leases for certain facility storage tanks and equipment rentals. These finance leases are not material to our financial statements. Our leases have remaining lease terms ranging from 1 to 13 years. Some of our leases have options to extend for various periods, while some have termination options with prior notice of generally 30 days or six months. The office space, warehouse space, operating location leases, and machinery and equipment leases generally require us to pay all maintenance and insurance costs.

Our corporate headquarters facility located in The Woodlands, Texas, was sold on December 31, 2012, pursuant to a sale and leaseback transaction. As a condition to the completion of the purchase and sale of the facility, the parties entered into a lease agreement for the facility having an initial lease term of 15 years, which is classified as an operating lease. Under the terms of the lease agreement, we have the ability to extend the lease for five successive five-year periods at base rental rates to be determined at the time of each extension.

Components of lease expense, included in either cost of revenues or general and administrative expense based on the use of the underlying asset, are as follows (inclusive of lease expense for leases not included on our consolidated balance sheet based on our accounting policy election to exclude leases with a term of 12 months or less):

	Year Ended December 31,
	2021		2020		2019
	(In Thousands)
Operating lease expense	$	12,905	$	13,946	$	15,131
Short-term lease expense	22,055		17,125		36,348
Total lease expense	$	34,960	$	31,071	$	51,479

For the years ended December 31, 2021, 2020 and 2019, we recognized sublease income of $1.0 million. Variable rent expense was not material. At December 31, 2021, future minimum rental receipts under non-cancelable subleases for office space in two of our locations totaled $5.1 million.

Supplemental cash flow information:

	Year Ended December 31,
	2021		2020		2019
	(In Thousands)
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows - operating leases	$	12,962	$	13,612	$	15,064
Right-of-use assets obtained in exchange for lease obligations:
Operating leases	$	3,168	$	5,612	$	3,944

Supplemental balance sheet information:

	December 31, 2021		December 31, 2020
	(In Thousands)
Operating leases:
Operating lease right-of-use assets	$	36,973	$	43,448
Operating lease liabilities, current portion	$	8,108	$	8,795
Operating lease liabilities	$	31,429	$	37,569
Total operating lease liabilities	$	39,537	$	46,364

Additional operating lease information:

	December 31, 2021		December 31, 2020
Weighted average remaining lease term:
Operating leases	6.4 years		6.8 years
Weighted average discount rate:
Operating leases	9.67	%	9.62	%

Future minimum lease payments by year and in the aggregate, under non-cancelable operating leases with terms in excess of one year consist of the following at December 31, 2021:

	Operating Leases
	(In Thousands)
2022	$	11,507
2023	9,241
2024	7,412
2025	5,721
2026	5,635
Thereafter	13,867
Total lease payments	53,383
Less imputed interest	(13,846)
Total lease liabilities	$	39,537