Note 11. Commitments and Contingencies

Leases

We lease office space, equipment and vehicles that have non-cancelable lease terms. Currently, our outstanding leases have terms up to 8 years. We have subleased part of the office space included in our operating leases for which we received rental payments. The following table summarizes operating lease payments paid and sublease rentals received during the periods indicated:



	Year Ended December 31,
In thousands	2017		2016		2015
Operating lease payments	$	25,075	$	22,744	$	29,403
Sublease rental receipts	4,275		3,074		3,698

The following tables summarize by year the remaining non-cancelable future payments under our leases as of December 31, 2017:



In thousands	Pipeline and Capital Leases
2018	$	43,105
2019	40,215
2020	27,872
2021	26,092
2022	27,827
Thereafter	137,342
Total minimum lease payments	302,453
Less: Amount representing interest	(83,726		)
Present value of minimum lease payments	$	218,727



In thousands	Operating Leases
2018	$	11,315
2019	10,675
2020	9,787
2021	10,020
2022	10,255
Thereafter	28,799
Total minimum lease payments	$	80,851

In addition, we expect to receive approximately $3.5 million for 2018 through 2019 under our sublease agreements.

Commitments

We have entered into long-term commitments to purchase CO₂ that are either non-cancelable or cancelable only upon the occurrence of specified future events. The commitments continue for up to 15 years. The price we will pay for CO₂ generally varies depending on the amount of CO₂ delivered and the price of oil. Once all commitments have commenced, our annual commitment under these contracts could range from $14 million to $33 million per year, assuming a $60 per Bbl NYMEX oil price.

The Company has a CO₂ offtake agreement with Mississippi Power Company (“MSPC”), providing for our purchase of CO₂ generated as a byproduct of the gasification portion of their Kemper County energy facility. After receiving minor amounts of CO₂ from the facility during the first half of 2017, in June 2017, MSPC announced the immediate and indefinite suspension of startup and operations activities of the lignite coal gasification portion of the Kemper County energy facility. As a result of this suspension, the Company is not expecting to receive any CO₂ from this facility for the foreseeable future.

We are party to long-term contracts that require us to deliver CO₂ to our industrial CO₂ customers at various contracted prices, plus we have a CO₂ delivery obligation to Genesis related to one CO₂ volumetric production payment (“VPP”). Based upon the maximum amounts deliverable as stated in the industrial contracts and the VPP, we estimate that we may be obligated to deliver up to 633 Bcf of CO₂ to these customers over the next 15 years. The maximum volume required in any given year is approximately 176 MMcf/d, which we judge to be minor given the size of our Jackson Dome proved CO₂ reserves at December 31, 2017, our current production capabilities and our projected levels of CO₂ usage for our own tertiary flooding program.

Litigation

We are involved in various lawsuits, claims and regulatory proceedings incidental to our businesses. While we currently believe that the ultimate outcome of these proceedings, individually and in the aggregate, will not have a material adverse effect on our financial position, results of operations or cash flows, litigation is subject to inherent uncertainties. Although a single or multiple adverse rulings or settlements could possibly have a material adverse effect on our finances, we only accrue for losses from litigation and claims if we determine that a loss is probable and the amount can be reasonably estimated.

Riley Ridge Helium Supply Contract Claim

As part of our 2010 and 2011 acquisitions of the Riley Ridge Unit and associated gas processing facility that was under construction, the Company assumed a 20-year helium supply contract under which we agreed to supply the helium separated from the full well stream by operation of the gas processing facility to a third-party purchaser, APMTG Helium, LLC. The helium supply contract provides for the delivery of a minimum contracted quantity of helium, subject to adjustment after startup of the Riley Ridge gas processing facility, with liquidated damages payable if specified quantities of helium are not supplied in accordance with the terms of the contract. The liquidated damages are specified in the contract at up to $8.0 million per contract year and are capped at an aggregate of $46.0 million over the term of the contract. As the gas processing facility has been shut-in since mid-2014, we have not been able to supply helium under the helium supply contract. APMTG Helium, LLC filed a case in November 2014 in the Ninth Judicial District Court of Sublette County, Wyoming, claiming multiple years of liquidated damages for non-delivery of volumes of helium specified under the helium supply contract. In response, we are taking the position that our contractual obligations are excused by virtue of events that fall within the force majeure provisions in the helium supply contract. The evidentiary phase of the trial closed on November 29, 2017. The parties submitted written closing briefs to the District Court on February 23, 2018 and have agreed to submit written rebuttals to such closing briefs by March 30, 2018. Following those submissions, the case will be fully submitted for determination by the District Court. We currently expect a ruling to be made in the second or third quarter of 2018. The Company plans to continue to vigorously defend its position, but we are unable to predict at this time the outcome of this dispute.

Other Contingencies

We are subject to audits for various taxes (income, sales and use, and severance) in the various states in which we operate, and from time to time receive assessments for potential taxes that we may owe. In the past, settlement of these matters has not had a material adverse financial impact on us, and currently we have no material assessments for potential taxes.

We are subject to various possible contingencies that arise primarily from interpretation of federal and state laws and regulations affecting the oil and natural gas industry. Such contingencies include differing interpretations as to the prices at which oil and natural gas sales may be made, the prices at which royalty owners may be paid for production from their leases, environmental issues and other matters. Although we believe that we have complied with the various laws and regulations, administrative rulings and interpretations thereof, adjustments could be required as new interpretations and regulations are issued. In addition, production rates, marketing and environmental matters are subject to regulation by various federal and state agencies.