RICE MIDSTREAM PARTNERS LP, 10-K filed on 2/15/2018
Annual Report
Document and Entity Information (USD $)
In Billions, except Share data, unless otherwise specified
12 Months Ended
Dec. 31, 2017
Jun. 30, 2017
Jan. 31, 2018
Common Units
Jan. 31, 2018
Subordinated
Document and Entity Information [Line Items]
 
 
 
 
Entity Registrant Name
Rice Midstream Partners LP 
 
 
 
Trading Symbol
RMP 
 
 
 
Entity Central Index Key
0001620928 
 
 
 
Current Fiscal Year End Date
--12-31 
 
 
 
Entity Filer Category
Large Accelerated Filer 
 
 
 
Document Type
10-K 
 
 
 
Document Period End Date
Dec. 31, 2017 
 
 
 
Document Fiscal Year Focus
2017 
 
 
 
Document Fiscal Period Focus
FY 
 
 
 
Amendment Flag
false 
 
 
 
Entity Common Stock, Shares Outstanding
 
 
73,549,485 
28,753,623 
Entity Well-known Seasoned Issuer
Yes 
 
 
 
Entity Voluntary Filers
No 
 
 
 
Entity Current Reporting Status
Yes 
 
 
 
Entity Public Float
 
$ 1.5 
 
 
Consolidated Balance Sheets (USD $)
In Thousands, unless otherwise specified
Dec. 31, 2017
Dec. 31, 2017
Common
Dec. 31, 2017
Subordinated
Dec. 31, 2016
Predecessor
Dec. 31, 2016
Predecessor
Common
Dec. 31, 2016
Predecessor
Subordinated
Current assets:
 
 
 
 
 
 
Cash
$ 10,538 
 
 
$ 21,834 
 
 
Accounts receivable
12,246 
 
 
8,758 
 
 
Accounts receivable - affiliate
46,182 
 
 
11,838 
 
 
Prepaid expenses, deposits and other
1,327 
 
 
64 
 
 
Total current assets
70,293 
 
 
42,494 
 
 
Property and equipment, net
1,431,802 
 
 
805,027 
 
 
Deferred financing costs, net
 
 
12,591 
 
 
Goodwill
1,346,918 
 
 
494,580 
 
 
Other assets
 
 
44,525 
 
 
Total assets
2,849,013 
 
 
1,399,217 
 
 
Current liabilities:
 
 
 
 
 
 
Accounts payable
 
 
4,172 
 
 
Accrued capital expenditures
24,630 
 
 
9,074 
 
 
Other accrued liabilities
4,200 
 
 
8,376 
 
 
Total current liabilities
28,834 
 
 
21,622 
 
 
Long-term liabilities:
 
 
 
 
 
 
Revolving credit facility
286,000 
 
 
190,000 
 
 
Other long-term liabilities
9,360 
 
 
5,189 
 
 
Total liabilities
324,194 
 
 
216,811 
 
 
Partners’ capital:
 
 
 
 
 
 
Parent net equity
 
 
 
 
Common and subordinated units
 
1,566,625 
612,454 
 
1,275,935 
(94,417)
General Partner
345,740 
 
 
888 
 
 
Total partners’ capital
2,524,819 
 
 
1,182,406 
 
 
Total liabilities and partners’ capital
$ 2,849,013 
 
 
$ 1,399,217 
 
 
Consolidated Balance Sheets - Parenthetical
Dec. 31, 2017
Common
Dec. 31, 2017
Subordinated
Dec. 31, 2016
Predecessor
Common
Dec. 31, 2016
Predecessor
Subordinated
Common and Subordinated units outstanding (in units)
73,549,485 
28,753,623 
73,519,133 
28,753,623 
Common and Subordinated units issued (in units)
73,549,485 
28,753,623 
73,519,133 
28,753,623 
Consolidated Statements of Operations (USD $)
2 Months Ended 12 Months Ended 2 Months Ended 10 Months Ended 12 Months Ended 10 Months Ended 12 Months Ended 10 Months Ended 12 Months Ended
Dec. 31, 2017
Dec. 31, 2017
Limited Partners
Dec. 31, 2015
Limited Partners
Dec. 31, 2017
Subordinated
Nov. 12, 2017
Predecessor
Dec. 31, 2016
Predecessor
Dec. 31, 2015
Predecessor
Nov. 12, 2017
Predecessor
Limited Partners
Dec. 31, 2016
Predecessor
Limited Partners
Dec. 31, 2015
Predecessor
Limited Partners
Nov. 12, 2017
Predecessor
Subordinated
Dec. 31, 2016
Predecessor
Subordinated
Dec. 31, 2015
Predecessor
Subordinated
Operating revenues:
 
 
 
 
 
 
 
 
 
 
 
 
 
Affiliate
$ 44,134,000 
 
 
 
$ 203,642,000 
$ 152,260,000 
$ 93,668,000 
 
 
 
 
 
 
Third-party
85,000 
 
 
 
46,832,000 
49,363,000 
20,791,000 
 
 
 
 
 
 
Total operating revenues
44,219,000 
 
 
 
250,474,000 
201,623,000 
114,459,000 
 
 
 
 
 
 
Operating expenses:
 
 
 
 
 
 
 
 
 
 
 
 
 
Operation and maintenance expense
7,182,000 
 
 
 
33,768,000 
24,608,000 
14,910,000 
 
 
 
 
 
 
General and administrative expense
3,612,000 1
 
 
 
22,252,000 1
21,613,000 1
17,895,000 1
 
 
 
 
 
 
Incentive unit expense
2
 
 
 
2
2
1,044,000 2
 
 
 
 
 
 
Depreciation expense
7,480,000 
 
 
 
26,420,000 
25,170,000 
16,399,000 
 
 
 
 
 
 
Acquisition costs
 
 
 
529,000 
125,000 
 
 
 
 
 
 
Amortization of intangible assets
 
 
 
1,413,000 
1,634,000 
1,632,000 
 
 
 
 
 
 
Other expense
 
 
 
2,614,000 
1,531,000 
543,000 
 
 
 
 
 
 
Total operating expenses
18,274,000 
 
 
 
86,996,000 
74,681,000 
52,423,000 
 
 
 
 
 
 
Operating income
25,945,000 
 
 
 
163,478,000 
126,942,000 
62,036,000 
 
 
 
 
 
 
Other income
15,000 
 
 
 
56,000 
78,000 
11,000 
 
 
 
 
 
 
Interest expense
(826,000)3
 
(800,000)
 
(7,053,000)3
(3,931,000)3
(3,164,000)3
 
 
 
 
 
 
Amortization of deferred finance costs
 
 
 
(3,642,000)
(1,479,000)
(576,000)
 
 
 
 
 
 
Income before income taxes
25,134,000 
 
 
 
152,839,000 
121,610,000 
58,307,000 
 
 
 
 
 
 
Income tax expense
 
 
 
(5,812,000)
 
 
 
 
 
 
Net income
25,134,000 
 
 
 
152,839,000 
121,610,000 
52,495,000 
 
 
 
 
 
 
Calculation of limited partner interest in net income:
 
 
 
 
 
 
 
 
 
 
 
 
 
Less: Pre-acquisition net income allocated to general partner
 
 
 
7,296,000 
 
 
 
 
 
 
Less: General partner interest in net income attributable to incentive distribution rights
1,599,000 
 
 
 
6,182,000 
1,428,000 
 
 
 
 
 
 
Limited partner net income
23,535,000 
 
 
6,615,000 
146,657,000 
120,182,000 
45,199,000 
 
 
 
41,225,000 
43,197,000 
21,859,000 
Net income per limited partner:
 
 
 
 
 
 
 
 
 
 
 
 
 
Common units (basic) (in dollars per share)
$ 0.23 
 
 
$ 0.23 
$ 1.43 
$ 1.47 
$ 0.76 
 
 
 
$ 1.43 
$ 1.50 
$ 0.76 
Common units (diluted) (in dollars per share)
$ 0.23 
 
 
 
$ 1.43 
$ 1.47 
$ 0.76 
 
 
 
$ 1.43 
$ 1.50 
$ 0.76 
Subordinated units (basic and diluted) (in dollars per share)
 
 
 
$ 0.23 4
 
 
 
 
 
 
$ 1.43 4
$ 1.50 4
$ 0.76 4
General and administrative expense from EQT
 
$ 2,900,000 
 
 
 
 
 
$ 19,400,000 
$ 16,600,000 
$ 11,900,000 
 
 
 
Consolidated Statements of Cash Flows (USD $)
In Thousands, unless otherwise specified
2 Months Ended 10 Months Ended 12 Months Ended
Dec. 31, 2017
Nov. 12, 2017
Predecessor
Dec. 31, 2016
Predecessor
Dec. 31, 2015
Predecessor
Cash flows from operating activities:
 
 
 
 
Net income
$ 25,134 
$ 152,839 
$ 121,610 
$ 52,495 
Adjustments to reconcile net income to net cash provided by operating activities:
 
 
 
 
Depreciation expense
7,480 
26,420 
25,170 
16,399 
Amortization of intangibles
1,413 
1,634 
1,632 
Amortization of deferred finance costs
3,642 
1,479 
576 
Incentive unit expense
1
1
1
1,044 1
Equity compensation expense
17 
497 
2,854 
4,501 
Deferred income tax expense
1,388 
Changes in operating assets and liabilities:
 
 
 
 
Accounts receivable
(7,283)
(30,540)
(4,232)
(14,174)
Prepaid expenses and other
176 
(1,400)
37 
Accounts payable
(2,327)
1,751 
373 
(478)
Accrued liabilities
(767)
(3,811)
5,192 
6,621 
Net cash provided by operating activities
22,430 
150,811 
154,117 
70,006 
Cash flows from investing activities:
 
 
 
 
Capital expenditures
(34,553)
(123,767)
(121,087)
(248,463)
Acquisition of Water Assets
(131,528)
Acquisition of Vantage Midstream Assets
(600,000)
Other acquisitions
(7,654)
Net cash used in investing activities
(34,553)
(131,421)
(721,087)
(379,991)
Cash flows from financing activities:
 
 
 
 
Purchase price in excess of related party net assets
(68,470)
Proceeds from borrowings
20,000 
76,000 
233,000 
313,000 
Repayments of borrowings
(186,000)
(170,000)
Costs related to initial public offering
(129)
Common units issuance, net of offering costs
620,330 
171,902 
Additions to deferred financing costs
(81)
(11,801)
Contributions from parent, net
39 
78,480 
Distributions paid to GP Holdings
(10,041)
(26,218)
(25,473)
(17,021)
Distributions paid to common unitholders
(78,223)
(46,239)
(17,017)
Employee tax withholding for settlement of phantom unit award vestings
(2,649)
Net cash provided by (used in) financing activities
9,959 
(28,522)
581,207 
290,748 
Net (decrease) increase in cash
(2,164)
(9,132)
14,237 
(19,237)
Cash at the beginning of the period
12,702 
21,834 
7,597 
26,834 
Cash at the end of the period
10,538 
12,702 
21,834 
7,597 
Supplemental disclosure of cash flow information:
 
 
 
 
Cash paid for interest
1,836 
7,331 
2,652 
3,146 
Capital expenditures financed by accounts payable
15,197 
2,239 
Noncash elimination of deferred tax liabilities for the Water Assets
$ 0 
$ 0 
$ 0 
$ 7,715 
Consolidated Statements of Partners' Capital (USD $)
In Thousands, unless otherwise specified
Total
Common
Subordinated
Limited Partners
Common
Limited Partners
Subordinated
General Partner
Parent Net Equity
Predecessor
Predecessor
Common
Predecessor
Subordinated
Predecessor
Limited Partners
Common
Predecessor
Limited Partners
Subordinated
Predecessor
General Partner
Predecessor
Parent Net Equity
Balance at Dec. 31, 2014
 
 
 
 
 
 
 
$ 429,944 
 
 
$ 442,451 
$ (49,101)
$ 0 
$ 36,594 
Increase (Decrease) in Partners' Capital [Roll Forward]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Contributions from parent, net
 
 
 
 
 
 
 
78,480 
 
 
 
 
 
78,480 
Incentive compensation expense
 
 
 
 
 
 
 
1,044 
 
 
 
 
 
1,044 
Equity compensation expense
 
 
 
 
 
 
 
4,419 
 
 
4,020 
 
 
399 
Offering costs related to the initial public offering
 
 
 
 
 
 
 
(129)
 
 
(129)
 
 
 
Distributions to unitholders
 
 
 
 
 
 
 
(34,038)
 
 
(17,019)
(17,019)
 
 
Issuance of common units, net of offering costs
 
 
 
 
 
 
 
171,902 
 
 
171,902 
 
 
 
Elimination of current and deferred tax liabilities
 
 
 
 
 
 
 
7,715 
 
 
 
 
 
7,715 
Pre-acquisition net income allocated to general partner
 
 
 
 
 
 
 
7,296 
 
 
 
 
 
7,296 
Water Assets from Rice Energy
 
 
 
 
 
 
 
(131,528)
 
 
 
 
 
(131,528)
Purchase price in excess of net assets from Rice Energy
 
 
 
 
 
 
 
(68,470)
 
 
(8)
(68,462)
 
 
Limited partner net income
 
 
 
 
 
 
 
45,199 
23,340 
21,859 
23,340 
21,859 
 
 
Net income
 
 
 
 
 
 
 
52,495 
 
 
 
 
 
 
Balance at Dec. 31, 2015
 
 
 
 
 
 
 
511,834 
 
 
624,557 
(112,723)
 
Increase (Decrease) in Partners' Capital [Roll Forward]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income
 
 
 
 
 
 
 
34,426 
 
 
 
 
 
 
Balance at Mar. 31, 2016
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Balance at Dec. 31, 2015
 
 
 
 
 
 
 
511,834 
 
 
624,557 
(112,723)
 
Increase (Decrease) in Partners' Capital [Roll Forward]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Contributions from parent, net
 
 
 
 
 
 
 
39 
 
 
 
39 
 
 
Equity compensation expense
 
 
 
 
 
 
 
306 
 
 
306 
 
 
 
Distributions to unitholders
 
 
 
 
 
 
 
(71,713)
 
 
(46,243)
(24,930)
(540)
 
Pre-acquisition net income allocated to general partner
 
 
 
 
 
 
 
 
 
 
 
 
 
Issuance of common units to public, net of offering costs
 
 
 
 
 
 
 
620,330 
 
 
620,330 
 
 
 
Limited partner net income
 
 
 
 
 
 
 
120,182 
76,985 
43,197 
 
 
 
 
Net income
 
 
 
 
 
 
 
121,610 
 
 
76,985 
43,197 
1,428 
 
Balance at Dec. 31, 2016
 
 
 
 
 
 
 
1,182,406 
 
 
1,275,935 
(94,417)
888 
Balance at Sep. 30, 2016
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Increase (Decrease) in Partners' Capital [Roll Forward]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income
 
 
 
 
 
 
 
34,529 
 
 
 
 
 
 
Balance at Dec. 31, 2016
 
 
 
 
 
 
 
1,182,406 
 
 
 
 
 
Increase (Decrease) in Partners' Capital [Roll Forward]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income
 
 
 
 
 
 
 
37,615 
 
 
 
 
 
 
Balance at Mar. 31, 2017
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Balance at Dec. 31, 2016
 
 
 
 
 
 
 
1,182,406 
 
 
1,275,935 
(94,417)
888 
Increase (Decrease) in Partners' Capital [Roll Forward]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equity compensation expense
 
 
 
 
 
 
 
497 
 
 
497 
 
 
 
Distributions to unitholders
 
 
 
 
 
 
 
(114,482)
 
 
(78,227)
(30,588)
(5,667)
 
Pre-acquisition net income allocated to general partner
 
 
 
 
 
 
 
 
 
 
 
 
 
Limited partner net income
 
 
 
 
 
 
 
146,657 
105,432 
41,225 
 
 
 
 
Net income
 
 
 
 
 
 
 
152,839 
 
 
105,432 
41,225 
6,182 
 
Balance at Nov. 12, 2017
 
 
 
 
 
 
1,221,260 
 
 
1,303,637 
(83,780)
1,403 
Balance at Sep. 30, 2017
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Increase (Decrease) in Partners' Capital [Roll Forward]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income
 
 
 
 
 
 
 
19,710 
 
 
 
 
 
 
Balance at Nov. 12, 2017
2,499,668 
 
 
1,549,688 
605,839 
344,141 
1,221,260 
 
 
 
 
 
Increase (Decrease) in Partners' Capital [Roll Forward]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equity compensation expense
17 
 
 
17 
 
 
 
 
 
 
 
 
 
 
Pre-acquisition net income allocated to general partner
 
 
 
 
 
 
 
 
 
 
 
 
 
Limited partner net income
23,535 
16,920 
6,615 
 
 
 
 
 
 
 
 
 
 
 
Net income
25,134 
 
 
16,920 
6,615 
1,599 
 
 
 
 
 
 
 
 
Balance at Dec. 31, 2017
$ 2,524,819 
 
 
$ 1,566,625 
$ 612,454 
$ 345,740 
$ 0 
 
 
 
 
 
 
 
Mergers and Acquisitions
Mergers and Acquisitions
Mergers and Acquisitions
Rice Energy’s Merger with EQT

EQT performed a preliminary valuation of the fair value of the Partnership’s assets and liabilities as of the Merger Date. The fair value of the Partnership’s current assets and current liabilities were assumed to approximate their carrying values. The estimated fair value of the Partnership’s long-lived tangible assets was determined utilizing observable market inputs where available or estimated replacement cost adjusted for a usage or obsolescence factor. The estimated fair value of the Partnership’s long-term liabilities was determined utilizing observable market inputs where available or estimated based on their current carrying values. The Partnership has recorded goodwill as the excess of the estimated enterprise value over the sum of the fair value amounts allocated to the Partnership’s assets and liabilities. Goodwill was allocated to the value attributed to additional growth opportunities, synergies and operating leverage within the Partnership’s gathering and compression segment.

The following table summarizes the preliminary allocation of the fair value of the assets and liabilities of the Partnership as of the Merger Date through pushdown accounting from EQT. The preliminary allocation to certain assets and/or liabilities may be adjusted by material amounts as EQT continues to finalize the fair value estimates. Certain data necessary to complete the purchase price allocation is not yet available, including, but is not limited to, final appraisals of assets acquired and liabilities assumed. EQT expects to complete the purchase price allocation once it has received all of the necessary information, at which time the value of the assets and liabilities will be revised as appropriate.
(in thousands)
 
At November 13, 2017
Estimated Value of RMP
 
$
2,499,668

 
 
 
Estimated Fair Value of Assets Acquired and Liabilities Assumed:
 
 
Current assets
 
$
65,300

Property and equipment, net
 
1,419,077

Other non-current assets
 
47

Current liabilities
 
(56,351
)
Revolving credit facility
 
(266,000
)
Other non-current liabilities
 
(9,323
)
Total estimated fair value of assets acquired and liabilities assumed
 
$
1,152,750

Goodwill
 
$
1,346,918


Vantage Acquisition
On September 26, 2016, the Partnership entered into the Midstream Purchase Agreement. Pursuant to the terms of the Midstream Purchase Agreement, and following the closing of the Vantage Acquisition, on October 19, 2016, the Partnership acquired from Rice Energy all of the outstanding membership interests of the Vantage Midstream Entities. The Vantage Midstream Entities own midstream assets, including approximately 30 miles of dry gas gathering and compression assets and water assets. In consideration for the acquisition of the Vantage Midstream Asset Acquisition, the Partnership paid Rice Energy $600 million in aggregate consideration, which the Partnership paid in cash with the net proceeds of its private placement of common units (the 2016 Private Placement) of $441 million and borrowings under its revolving credit facility (defined in Note 3) of $159 million. The purchase price allocation ascribed approximately $144.6 million to property and equipment, $0.4 million in net working capital, and $455 million to goodwill.
The Partnership’s acquisition of the Vantage Midstream Entities from Rice Energy was accounted for as a combination of entities under common control at historical cost. As the Vantage Midstream Asset Acquisition occurred concurrently with the Vantage Acquisition, no predecessor period existed which would warrant retrospective recast of the Partnership’s financial statements.
The purchase price allocation was performed by Rice Energy. The fair values of the assets acquired were determined using various valuation techniques, including the cost approach. The assumed purchase price and fair values were prepared with the assistance of external specialists, and represented Rice Energy’s best estimate of the fair values of the assets acquired. Goodwill was allocated to the value attributed to additional growth opportunities, synergies and operating leverage within the Partnership’s gathering and compression segment as of December 31, 2016.
Post-Acquisition Operating Results
The Vantage Midstream Entities contributed the following to the Partnership’s consolidated operating results for the period from November 13, 2017 to December 31, 2017, for the period from January 1, 2017 to November 12, 2017 and for the period from October 19, 2016 to December 31, 2016.
 
 
Successor
 
 
Predecessor
 
 
Period from
November 13, 2017 to December 31, 2017
 
 
Period from
January 1, 2017 to November 12, 2017
 
Period from October 19. 2016 to December 31, 2016
(in thousands)
 
 
 
 
Operating revenues
 
$
6,529

 
 
$
51,190

 
$
8,571

Net income
 
$
5,412

 
 
$
38,200

 
$
4,303


Pro Forma Information

The following unaudited pro forma combined financial information presents the Partnership’s results as though the acquisition of the Vantage Midstream Entities and the 2016 Private Placement had been completed at January 1, 2015.
 
 
Predecessor
 
 
Year Ended
December 31,
(in thousands, except per unit data)
 
2016
 
2015
Operating revenues
 
$
253,817

 
$
156,944

Limited partner net income
 
$
150,846

 
$
67,199

Earnings per common unit (basic)
 
$
1.54

 
$
0.84

Earnings per common unit (diluted)
 
$
1.54

 
$
0.83

Earnings per subordinated units
 
$
1.55

 
$
0.84

Revolving Credit Facility
Revolving Credit Facility
Revolving Credit Facility
On December 22, 2014, Rice Midstream OpCo LLC, the Partnership’s wholly-owned subsidiary (Rice Midstream OpCo), entered into a revolving credit agreement (as amended, the Revolving Credit Facility) with Wells Fargo Bank, N.A., as administrative agent, and a syndicate of lenders.
As of December 31, 2017, the Revolving Credit Facility provided for lender commitments of $850 million, with an additional $200 million of commitments available under an accordion feature, subject to lender approval. As of December 31, 2017, Rice Midstream OpCo had $286 million of borrowings and $1 million of letters of credit outstanding under this facility, resulting in availability of $563 million. The average daily outstanding balance of the credit facility was approximately $216 million and interest was incurred on the facility at a weighted average annual interest rate of 3.1% during 2017. The Revolving Credit Facility is available to fund working capital requirements and capital expenditures, to purchase assets, to pay distributions, to repurchase units and for general partnership purposes. The Revolving Credit Facility matures on December 22, 2019.
Principal amounts borrowed are payable on the maturity date, and interest is payable quarterly for base rate loans and at the end of the applicable interest period for Eurodollar loans. Rice Midstream OpCo may elect to borrow in Eurodollars or at the base rate. Eurodollar loans bear interest at a rate per annum equal to the applicable LIBOR Rate plus an applicable margin ranging from 200 to 300 basis points, depending on the leverage ratio in effect from time to time, and base rate loans bear interest at a rate per annum equal to the greatest of (i) the agent bank’s reference rate, (ii) the federal funds effective rate plus 50 basis points and (iii) the rate for one month Eurodollar loans plus 100 basis points, plus an applicable margin ranging from 100 to 200 basis points, depending on the leverage ratio in effect from time to time. The carrying amount of the Revolving Credit Facility is comprised of borrowings for which interest accrues under a fluctuating interest rate structure. Accordingly, the carrying value approximates fair value as of December 31, 2017 and represents a Level 2 measurement. Rice Midstream OpCo also pays a commitment fee based on the undrawn commitment amount ranging from 37.5 to 50 basis points.
The Revolving Credit Facility is secured by mortgages and other security interests on substantially all of its properties and is guaranteed by the Partnership and its restricted subsidiaries. The Revolving Credit Facility limits the Partnership’s ability to, among other things, incur or guarantee additional debt; redeem or repurchase units or make distributions under certain circumstances; make certain investments and acquisitions; incur certain liens or permit them to exist; enter into certain types of transactions with affiliates; merge or consolidate with another company; and transfer, sell or otherwise dispose of assets.
The Revolving Credit Facility also requires the Partnership to maintain the following financial ratios:
an interest coverage ratio, which is the ratio of the Partnership’s consolidated EBITDA (as defined within the Revolving Credit Facility) to its consolidated current interest expense of at least 2.50 to 1.0 at the end of each fiscal quarter;
a consolidated total leverage ratio, which is the ratio of consolidated debt to consolidated EBITDA, of not more than 4.75 to 1.0, and after electing to issue senior unsecured notes, a consolidated total leverage ratio of not more than 5.25 to 1.0, and, in each case, with certain increases in the permitted total leverage ratio following the completion of a material acquisition; and
if the Partnership elects to issue senior unsecured notes, a consolidated senior secured leverage ratio, which is the ratio of consolidated senior secured debt to consolidated EBITDA, of not more than 3.50 to 1.0.
The Partnership was in compliance with such covenants and ratios as of December 31, 2017.
Commitments and Contingencies
Commitments and Contingencies
Commitments and Contingencies
Litigation
In the ordinary course of business, various legal and regulatory claims and proceedings are pending or threatened against the Partnership. While the amounts claimed may be substantial, the Partnership is unable to predict with certainty the ultimate outcome of such claims and proceedings. The Partnership accrues legal and other direct costs related to loss contingencies when actually incurred.  The Partnership has established reserves it believes to be appropriate for pending matters and, after consultation with counsel and giving appropriate consideration to available insurance, the Partnership believes that the ultimate outcome of any matter currently pending against the Partnership will not materially affect the Partnership’s business, financial condition, results of operations, liquidity or ability to make distributions.
The Partnership is subject to federal, state and local environmental laws and regulations. These laws and regulations, which are constantly changing, can require expenditures for remediation and in certain instances result in assessment of fines. The Partnership has established procedures for ongoing evaluation of its operations to identify potential environmental exposures and assure compliance with regulatory requirements. The estimated costs associated with identified situations that require remedial action are accrued. Ongoing expenditures for compliance with environmental law and regulations, including investments in plant and facilities to meet environmental requirements, have not been material. Management believes that any such required expenditures will not be significantly different in either nature or amount in the future and does not know of any environmental liabilities that will have a material effect on its business, financial condition, results of operations, liquidity or ability to make distributions.
Lease Obligations
The Partnership has lease obligations for compression equipment under existing contracts with third parties. Rent expense included in operation and maintenance expense for the periods from November 13, 2017 to December 31, 2017 and from January 1, 2017 to November 12, 2017, and the years ended December 31, 2016 and 2015 was $0.3 million, $1.2 million, $1.6 million and $1.7 million, respectively. Future payments for this equipment as of December 31, 2017 totaled $3.6 million (2018: $1.2 million; 2019: $1.2 million; 2020: $0.6 million; 2021: $0.3 million; and 2022: $0.3 million).
Partners' Capital
Partners' Capital
Partners’ Capital
The following table presents the Partnership’s common and subordinated units issued from January 1, 2016 through December 31, 2017:
 
Limited Partners
 
 
 
GP Holdings
 
Common
 
Subordinated
 
Total
 
Ownership %
Balance, January 1, 2016
42,163,749

 
28,753,623

 
70,917,372

 
41
%
Equity offering in June 2016
9,200,000

 

 
9,200,000

 
 
Equity offering in October 2016
20,930,233

 

 
20,930,233

 
 
Common units issued under at the market program (1)
944,700

 

 
944,700

 
 
Vested phantom units, net
280,451

 

 
280,451

 
 
Balance, December 31, 2016
73,519,133

 
28,753,623

 
102,272,756

 
28
%
Vested phantom units, net(2)
30,352

 

 
30,352

 
%
Balance, December 31, 2017
73,549,485

 
28,753,623

 
102,303,108

 
28
%

(1)
In May 2016, the Partnership entered into an equity distribution agreement that established an at the market common unit offering program, pursuant to which a group of managers, acting as sales agents, may sell RMP common units having an aggregate offering price of up to $100 million (the ATM Program). The Partnership has used the net proceeds from the sale of common units pursuant to the ATM Program for general partnership purposes, including repayment of debt, acquisitions and capital expenditures.
(2)
All 2017 phantom unit vestings occurred prior to the Merger Date.
As of December 31, 2017, GP Holdings owned an approximate 28% limited partner interest in the Partnership consisting of 3,623 common units and 28,753,623 subordinated units, as well as all of the incentive distribution rights in the Partnership. See Note 7 for information regarding the Partnership’s subordination period.
Phantom Unit Awards
Phantom Unit Awards
Phantom Unit Awards
The Partnership’s general partner has granted phantom unit awards under the LTIP to certain non-employee directors of the Partnership that provide services to the Partnership under an omnibus agreement with EQT. Pursuant to the LTIP, the maximum aggregate number of common units that may be issued pursuant to any and all awards under the LTIP shall not exceed 5,000,000 common units, subject to adjustment due to recapitalization or reorganization, or related to forfeitures or the expiration of awards, as provided under the LTIP.
The equity-based awards are valued at the date of issuance and the related compensation cost is recognized into earnings on a straight-line basis over the vesting period. The equity-based awards will cliff vest at the end of the requisite service period of approximately one year. The Partnership recorded $0.5 million, $2.8 million and $4.1 million of equity compensation cost related to these awards for the period from January 1, 2017 to November 12, 2017 and the years ended December 31, 2016 and 2015, respectively, in general and administrative expenses on the consolidated statements of operations. At December 31, 2017, total unrecognized compensation cost expected to be recognized over the remaining vesting periods was $0.2 million for these awards.
The following table summarizes the activity for the equity-based awards during the years ended December 31, 2017 and 2016.
 
 
Number of
units
 
Weighted average grant date fair value
Total unvested, January 1, 2016
 
432,628

 
$
16.52

Granted
 
30,352

 
17.81

Vested
 
(399,158
)
 
16.52

Forfeited
 
(33,470
)
 
16.50

Total unvested - December 31, 2016
 
30,352

 
$
17.81

Granted(1)
 
20,688

 
24.41

Vested(1)
 
(30,352
)
 
17.81

Total unvested - December 31, 2017
 
20,688

 
$
24.41


(1)
All 2017 equity-based awards were granted or vested prior to the Merger Date.
Net Income per Limited Partner Unit and Cash Distributions
Net Income per Limited Partner Unit and Cash Distributions
Net Income per Limited Partner Unit and Cash Distributions
Diluted net income per limited partner unit reflects the potential dilution that could occur if securities or agreements to issue common units, such as awards under the LTIP, were exercised, settled or converted into common units. When it is determined that potential common units should be included in diluted net income per limited partner unit calculation, the impact is reflected by applying the treasury stock method.
The following table presents the Partnership’s calculation of net income per limited partner unit for common and subordinated limited partner units.
 
 
Successor
 
 
Predecessor
(in thousands, except per unit data)
 
Period from
November 13, 2017 to December 31, 2017
 
 
Period from
January 1, 2017 to
November 12, 2017
 
Years Ended December 31,
2016
 
2015
Net income
 
$
25,134

 
 
$
152,839

 
$
121,610

 
$
52,495

Less: Pre-acquisition net income allocated to general partner (1)
 

 
 

 

 
7,296

Less: General partner interest in net income attributable to incentive distribution rights
 
1,599

 
 
6,182

 
1,428

 

Limited partner net income
 
$
23,535

 
 
$
146,657

 
$
120,182

 
$
45,199

 
 
 
 
 
 
 
 
 
 
Net income allocable to common units
 
$
16,920

 
 
$
105,432

 
$
76,985

 
$
23,340

Net income allocable to subordinated units
 
6,615

 
 
41,225

 
43,197

 
21,859

Limited partner net income
 
$
23,535

 
 
$
146,657

 
$
120,182


$
45,199

 
 
 
 
 
 
 
 
 
 
Weighted-average limited partner units outstanding - basic:
 
 
 
 
 
 
 
 
 
Common units
 
73,549,485

 
 
73,535,414

 
52,822,030

 
30,700,864

Subordinated units
 
28,753,623

 
 
28,753,623

 
28,753,623

 
28,753,623

Total
 
102,303,108

 
 
102,289,037

 
81,575,653


59,454,487

 
 
 
 
 
 
 
 
 
 
Weighted-average limited partner units outstanding - diluted:
 
 
 
 
 
 
 
 
 
Common units (2) 
 
73,558,609

 
 
73,544,497

 
53,065,865

 
30,807,972

Subordinated units
 
28,753,623

 
 
28,753,623

 
28,753,623

 
28,753,623

Total
 
102,312,232

 
 
102,298,120

 
81,819,488


59,561,595

 
 
 
 
 
 
 
 
 
 
Net income per limited partner unit - basic:
 
 
 
 
 
 
 
 
 
Common units
 
$
0.23

 
 
$
1.43

 
$
1.46

 
$
0.76

Subordinated units (3)
 
0.23

 
 
1.43

 
1.50

 
0.76

Total
 
$
0.23

 
 
$
1.43

 
$
1.47

 
$
0.76

 
 
 
 
 
 
 
 
 
 
Net income per limited partner unit - diluted:
 
 
 
 
 
 
 
 
 
Common units
 
$
0.23

 
 
$
1.43

 
$
1.45

 
$
0.76

Subordinated units (3)
 
0.23

 
 
1.43

 
1.50

 
0.76

Total
 
$
0.23

 
 
$
1.43

 
$
1.47

 
$
0.76

(1)
Pre-acquisition net income allocated to the general partner relates to operations of the Water Assets for periods prior to their acquisition.
(2)
Diluted weighted-average limited partner common units includes the effect of 9,124, 9,083, 243,835 and 107,108 units for the period from November 13, 2017 to December 31, 2017, the period from January 1, 2017 to November 12, 2017 and for the years ended December 31, 2016 and 2015, respectively.
(3) Basic and diluted income per limited partner unit is presented as if all earnings for the period had been distributed. While it appears that more income is allocated to the subordinated unitholders than the common unitholders for the year ended December 31, 2016, the Partnership’s partnership agreement prevents the Partnership from making a distribution to the subordinated unitholders in excess of those to the common unitholders.
Subordinated Units
Following the consummation of the Mergers, EQT indirectly owned all of the Partnership’s subordinated units. The principal difference between the Partnership’s common units and subordinated units was that, under the partnership agreement, for any quarter during the subordination period, holders of the subordinated units were not entitled to receive any distribution from operating surplus until the common units had received the minimum quarterly distribution for such quarter plus any arrearages in the payment of the minimum quarterly distribution from prior quarters. Subordinated units did not accrue arrearages. As a result of the declaration of the Partnership’s fourth quarter 2017 cash distribution, which was paid on February 14, 2018, the subordination period with respect to the Partnership’s 28,753,623 subordinated units expired on February 15, 2018 and all of the outstanding Partnership subordinated units converted into Partnership common units on a one-for-one basis on that day.
Cash Distributions
Within 45 days after the end of each quarter, pursuant to the terms of its partnership agreement, the Partnership intends to distribute to the holders of common units on a quarterly basis all of its available cash to the extent it has sufficient cash after the establishment of cash reserves and the payment of its expenses, including payments to its general partner and affiliates. Following the consummation of the Mergers, all of the incentive distribution rights are held indirectly by EQT through GP Holdings. Incentive distribution rights represent the right to receive increasing percentages (15%, 25% and 50%) of quarterly distributions from operating surplus after the minimum quarterly distribution and the target distribution levels have been achieved.
For any quarter in which the Partnership has distributed cash from operating surplus to the common unitholders in an amount equal to the minimum distribution, then the Partnership will distribute any additional available cash from operating surplus for that quarter among the unitholders and the incentive distribution rights holders in the following manner:
 
 
 
Marginal Percentage Interest in Distributions
 
Total Quarterly Distribution Per Unit
 
Unitholders
 
Incentive Distribution Rights Holders
Minimum Quarterly Distribution
$0.1875
 
100%
 
—%
First Target Distribution
above $0.1875 up to $0.2156
 
100%
 
—%
Second Target Distribution
above $0.2156 up to $0.2344
 
85%
 
15%
Third Target Distribution
above $0.2344 up to $0.2813
 
75%
 
25%
Thereafter
above $0.2813
 
50%
 
50%

In 2017 and 2016, cash distributions of $5.7 million and $0.5 million, respectively, were made to GP Holdings related to its incentive distribution rights in the Partnership based upon the level of distribution paid per common and subordinated unit.
The Board of Directors of the Partnership’s general partner declared the following cash distributions to the Partnership’s common and subordinated unitholders for the periods presented.
Quarters Ended
 
Total Quarterly Distribution per Unit
 
Date of Distribution
March 31, 2016
 
$
0.2100

 
May 12, 2016
June 30, 2016
 
$
0.2235

 
August 11, 2016
September 30, 2016
 
$
0.2370

 
November 10, 2016
December 31, 2016
 
$
0.2505

 
February 16, 2017
March 31, 2017
 
$
0.2608

 
May 18, 2017
June 30, 2017
 
$
0.2711

 
August 17, 2017
September 30, 2017
 
$
0.2814

 
November 16, 2017
December 31, 2017
 
$
0.2917

 
February 14, 2018
Income Taxes
Income Taxes
Income Taxes
The Partnership is not subject to federal and state income taxes as a result of its limited partner structure. For federal and state income tax purposes, all income, expenses, gains, losses and tax credits generated by the Partnership flow through to the unitholders. As such, the Partnership does not record a provision for income taxes in the current period. Prior to the Partnership’s IPO, the Partnership’s income was included as part of Rice Energy’s consolidated federal tax return.
Prior to the acquisition of the Water Assets, the operations of the Water Assets were subject to income taxes and were included as part of Rice Energy’s consolidated federal tax return. Accordingly, the income tax effects associated with the operations of the Water Assets continued to be subject to income taxes until the Water Assets were acquired by the Partnership. Due to the Partnership’s status for U.S. federal and state income tax purposes, net current and deferred income tax liabilities of the Water Assets of $7.7 million eliminated through equity on the effective date of their acquisition by the Partnership. For the year ended December 31, 2015, the Partnership recorded income tax expense of approximately $5.8 million associated with the operations of the Water Assets prior to acquisition by the Partnership.
Pursuant to an agreement between the Partnership and the Internal Revenue Service (IRS) regarding the Partnership’s 2016 tax reporting, the Partnership had two short tax years for the calendar year 2016 as a result of a technical termination that occurred on February 22, 2016. This technical termination resulted in a significant deferral of depreciation deductions that were otherwise allowable in computing the taxable income of the Partnership’s unitholders for the period February 23, 2016 through December 31, 2016. The Partnership provided a single Schedule K-1 to each unitholder reflecting the unitholder’s taxable income for the full calendar year.
Based on management’s analysis, the Partnership did not have any uncertain tax positions as of December 31, 2017.
Related Party Transactions
Related Party Transactions
Related Party Transactions
In the ordinary course of business, the Partnership engages in transactions with EQT and its affiliates, including but not limited to, gathering, compression and water services agreements. For periods prior to the Mergers, related parties included Rice Energy and certain of its subsidiaries. Following the consummation of the Mergers, related parties included EQT and certain of its subsidiaries.
Omnibus Agreement
On December 22, 2014, upon completion of the Partnership’s IPO, the Partnership entered into an omnibus agreement with Midstream Management, Rice Energy and other affiliates (the Initial Omnibus Agreement). Pursuant to the Initial Omnibus Agreement, Rice Energy performed centralized corporate and general and administrative services for the Partnership, such as financial and administrative, information technology, legal, health, safety and environmental, human resources, procurement, engineering, business development, investor relations, insurance and tax. In exchange, the Partnership reimbursed Rice Energy for the expenses incurred in providing these services, except for any expenses associated with Rice Energy’s long-term incentive programs. On the Merger Date, in connection with the completion of the Mergers, the Partnership, EQT and other affiliates entered into an Amended and Restated Omnibus Agreement (the Amended Omnibus Agreement), with substantially the same terms as the Initial Omnibus Agreement.
The expenses for which the Partnership reimburses EQT and its subsidiaries related to corporate and general and administrative services may not necessarily reflect the actual expenses that the Partnership would incur on a stand-alone basis. The Partnership is unable to estimate what the costs would have been with an unrelated third party.
Financial Information by Business Segment
Financial Information by Business Segment
Financial Information by Business Segment
The Partnership operates in two business segments: (i) gathering and compression and (ii) water services. Business segments are evaluated for their contribution to the Partnership’s consolidated results based on operating income. Other income and expenses, interest and income taxes are managed on a consolidated basis. There were no inter-segment transactions during any of the periods presented. The segment accounting policies are the same as those described in Note 1 to these consolidated financial statements. The operating results and assets of the Partnership’s reportable segments were as follows for each respective period.
 
Successor
 
Period from November 13, 2017 to December 31, 2017
(in thousands)
Gathering and Compression
 
Water Services
 
Consolidated Total
Total operating revenues
$
30,614

 
$
13,605

 
$
44,219

Total operating expenses
8,814

 
9,460

 
18,274

Operating income
$
21,800

 
$
4,145

 
$
25,945

 
 
 
 
 
 
Segment assets
$
2,640,682

 
$
208,331

 
$
2,849,013

Depreciation expense
$
3,965

 
$
3,515

 
$
7,480

Capital expenditures for segment assets
$
28,320

 
$
6,233

 
$
34,553

 
Predecessor
 
Period from January 1, 2017 to November 12, 2017
(in thousands)
Gathering and Compression
 
Water Services
 
Consolidated Total
Total operating revenues
$
167,492

 
$
82,982

 
$
250,474

Total operating expenses
46,743

 
40,253

 
86,996

Operating income
$
120,749

 
$
42,729

 
$
163,478

 
 
 
 
 
 
Depreciation expense
$
11,324

 
$
15,096

 
$
26,420

Capital expenditures for segment assets
$
113,373

 
$
10,394

 
$
123,767

 
Predecessor
 
Year Ended December 31, 2016
(in thousands)
Gathering and Compression
 
Water Services
 
Consolidated Total
Total operating revenues
$
132,099

 
$
69,524

 
$
201,623

Total operating expenses
38,951

 
35,730

 
74,681

Operating income
$
93,148

 
$
33,794

 
$
126,942

 
 
 
 
 
 
Segment assets
$
1,260,681

 
$
138,536

 
$
1,399,217

Depreciation expense
$
10,840

 
$
14,330

 
$
25,170

Capital expenditures for segment assets
$
113,033

 
$
8,054

 
$
121,087

 
Predecessor
 
Year Ended December 31, 2015
(in thousands)
Gathering and Compression
 
Water Services
 
Consolidated Total
Total operating revenues
$
77,211

 
$
37,248

 
$
114,459

Total operating expenses
28,326

 
24,097

 
52,423

Operating income
$
48,885

 
$
13,151

 
$
62,036

 
 
 
 
 
 
Segment assets
$
547,810

 
$
141,980

 
$
689,790

Depreciation expense
$
6,310

 
$
10,089

 
$
16,399

Capital expenditures for segment assets
$
149,706

 
$
98,757

 
$
248,463

Quarterly Financial Information (Unaudited)
Quarterly Financial Information (Unaudited)
Quarterly Financial Information (Unaudited)
The Partnership’s quarterly financial information for the years ended December 31, 2017 and 2016 is as follows (in thousands, except per unit data):
 
Predecessor
 
 
Successor
Year ended December 31, 2017: (1)
First
quarter
 
Second quarter
 
Third quarter
 
Period from October 1 to November 12
 
 
Period from November 13 to December 31
Operating revenues
$
62,750

 
$
72,377

 
$
81,701

 
$
33,646

 
 
$
44,219

Operating expenses
22,154

 
25,363

 
27,054

 
12,424

 
 
18,274

Operating income
40,596

 
47,014

 
54,647

 
21,222

 
 
25,945

Net income
$
37,615

 
$
44,060

 
$
51,454

 
$
19,710

 
 
$
25,134

Net income per limited partner unit - basic
$
0.36

 
$
0.42

 
$
0.48

 
$
0.18

 
 
$
0.23

Net income per limited partner unit - diluted
$
0.36

 
$
0.42

 
$
0.48

 
$
0.18

 
 
$
0.23

 
Predecessor
Year ended December 31, 2016: (1)
First
quarter
 
Second quarter
 
Third quarter
 
Fourth quarter (2)
Operating revenues
$
54,543

 
$
46,547

 
$
41,067

 
$
59,466

Operating expenses
18,926

 
17,547

 
15,531

 
22,677

Operating income
35,617

 
29,000

 
25,536

 
36,789

Net income
$
34,426

 
$
27,936

 
$
24,989

 
$
34,529

Net income per limited partner unit - basic
$
0.49

 
$
0.38

 
$
0.30

 
$
0.33

Net income per limited partner unit - diluted
$
0.48

 
$
0.38

 
$
0.30

 
$
0.33

(1)
The sum of quarterly data in some cases may not equal the yearly total due to rounding.
(2)
Includes the results of the Vantage Midstream Entities for the period from October 19, 2016 to December 31, 2016.
Mergers and Acquisitions (Tables)
The following table summarizes the preliminary allocation of the fair value of the assets and liabilities of the Partnership as of the Merger Date through pushdown accounting from EQT. The preliminary allocation to certain assets and/or liabilities may be adjusted by material amounts as EQT continues to finalize the fair value estimates. Certain data necessary to complete the purchase price allocation is not yet available, including, but is not limited to, final appraisals of assets acquired and liabilities assumed. EQT expects to complete the purchase price allocation once it has received all of the necessary information, at which time the value of the assets and liabilities will be revised as appropriate.
(in thousands)
 
At November 13, 2017
Estimated Value of RMP
 
$
2,499,668

 
 
 
Estimated Fair Value of Assets Acquired and Liabilities Assumed:
 
 
Current assets
 
$
65,300

Property and equipment, net
 
1,419,077

Other non-current assets
 
47

Current liabilities
 
(56,351
)
Revolving credit facility
 
(266,000
)
Other non-current liabilities
 
(9,323
)
Total estimated fair value of assets acquired and liabilities assumed
 
$
1,152,750

Goodwill
 
$
1,346,918

The Vantage Midstream Entities contributed the following to the Partnership’s consolidated operating results for the period from November 13, 2017 to December 31, 2017, for the period from January 1, 2017 to November 12, 2017 and for the period from October 19, 2016 to December 31, 2016.
 
 
Successor
 
 
Predecessor
 
 
Period from
November 13, 2017 to December 31, 2017
 
 
Period from
January 1, 2017 to November 12, 2017
 
Period from October 19. 2016 to December 31, 2016
(in thousands)
 
 
 
 
Operating revenues
 
$
6,529

 
 
$
51,190

 
$
8,571

Net income
 
$
5,412

 
 
$
38,200

 
$
4,303

The following unaudited pro forma combined financial information presents the Partnership’s results as though the acquisition of the Vantage Midstream Entities and the 2016 Private Placement had been completed at January 1, 2015.
 
 
Predecessor
 
 
Year Ended
December 31,
(in thousands, except per unit data)
 
2016
 
2015
Operating revenues
 
$
253,817

 
$
156,944

Limited partner net income
 
$
150,846

 
$
67,199

Earnings per common unit (basic)
 
$
1.54

 
$
0.84

Earnings per common unit (diluted)
 
$
1.54

 
$
0.83

Earnings per subordinated units
 
$
1.55

 
$
0.84

Partners' Capital Partners' Capital (Tables)
Schedule of Capital Units
The following table presents the Partnership’s common and subordinated units issued from January 1, 2016 through December 31, 2017:
 
Limited Partners
 
 
 
GP Holdings
 
Common
 
Subordinated
 
Total
 
Ownership %
Balance, January 1, 2016
42,163,749

 
28,753,623

 
70,917,372

 
41
%
Equity offering in June 2016
9,200,000

 

 
9,200,000

 
 
Equity offering in October 2016
20,930,233

 

 
20,930,233

 
 
Common units issued under at the market program (1)
944,700

 

 
944,700

 
 
Vested phantom units, net
280,451

 

 
280,451

 
 
Balance, December 31, 2016
73,519,133

 
28,753,623

 
102,272,756

 
28
%
Vested phantom units, net(2)
30,352

 

 
30,352

 
%
Balance, December 31, 2017
73,549,485

 
28,753,623

 
102,303,108

 
28
%

(1)
In May 2016, the Partnership entered into an equity distribution agreement that established an at the market common unit offering program, pursuant to which a group of managers, acting as sales agents, may sell RMP common units having an aggregate offering price of up to $100 million (the ATM Program). The Partnership has used the net proceeds from the sale of common units pursuant to the ATM Program for general partnership purposes, including repayment of debt, acquisitions and capital expenditures.
(2)
All 2017 phantom unit vestings occurred prior to the Merger Date.
Phantom Unit Awards (Tables)
Schedule of Share-based Compensation, Phantom Share Units (PSUs) Activity
The following table summarizes the activity for the equity-based awards during the years ended December 31, 2017 and 2016.
 
 
Number of
units
 
Weighted average grant date fair value
Total unvested, January 1, 2016
 
432,628

 
$
16.52

Granted
 
30,352

 
17.81

Vested
 
(399,158
)
 
16.52

Forfeited
 
(33,470
)
 
16.50

Total unvested - December 31, 2016
 
30,352

 
$
17.81

Granted(1)
 
20,688

 
24.41

Vested(1)
 
(30,352
)
 
17.81

Total unvested - December 31, 2017
 
20,688

 
$
24.41


(1)
All 2017 equity-based awards were granted or vested prior to the Merger Date.
Net Income per Limited Partner Unit and Cash Distributions (Tables)
The following table presents the Partnership’s calculation of net income per limited partner unit for common and subordinated limited partner units.
 
 
Successor
 
 
Predecessor
(in thousands, except per unit data)
 
Period from
November 13, 2017 to December 31, 2017
 
 
Period from
January 1, 2017 to
November 12, 2017
 
Years Ended December 31,
2016
 
2015
Net income
 
$
25,134

 
 
$
152,839

 
$
121,610

 
$
52,495

Less: Pre-acquisition net income allocated to general partner (1)
 

 
 

 

 
7,296

Less: General partner interest in net income attributable to incentive distribution rights
 
1,599

 
 
6,182

 
1,428

 

Limited partner net income
 
$
23,535

 
 
$
146,657

 
$
120,182

 
$
45,199

 
 
 
 
 
 
 
 
 
 
Net income allocable to common units
 
$
16,920

 
 
$
105,432

 
$
76,985

 
$
23,340

Net income allocable to subordinated units
 
6,615

 
 
41,225

 
43,197

 
21,859

Limited partner net income
 
$
23,535

 
 
$
146,657

 
$
120,182


$
45,199

 
 
 
 
 
 
 
 
 
 
Weighted-average limited partner units outstanding - basic:
 
 
 
 
 
 
 
 
 
Common units
 
73,549,485

 
 
73,535,414

 
52,822,030

 
30,700,864

Subordinated units
 
28,753,623

 
 
28,753,623

 
28,753,623

 
28,753,623

Total
 
102,303,108

 
 
102,289,037

 
81,575,653


59,454,487

 
 
 
 
 
 
 
 
 
 
Weighted-average limited partner units outstanding - diluted:
 
 
 
 
 
 
 
 
 
Common units (2) 
 
73,558,609

 
 
73,544,497

 
53,065,865

 
30,807,972

Subordinated units
 
28,753,623

 
 
28,753,623

 
28,753,623

 
28,753,623

Total
 
102,312,232

 
 
102,298,120

 
81,819,488


59,561,595

 
 
 
 
 
 
 
 
 
 
Net income per limited partner unit - basic:
 
 
 
 
 
 
 
 
 
Common units
 
$
0.23

 
 
$
1.43

 
$
1.46

 
$
0.76

Subordinated units (3)
 
0.23

 
 
1.43

 
1.50

 
0.76

Total
 
$
0.23

 
 
$
1.43

 
$
1.47

 
$
0.76

 
 
 
 
 
 
 
 
 
 
Net income per limited partner unit - diluted:
 
 
 
 
 
 
 
 
 
Common units
 
$
0.23

 
 
$
1.43

 
$
1.45

 
$
0.76

Subordinated units (3)
 
0.23

 
 
1.43

 
1.50

 
0.76

Total
 
$
0.23

 
 
$
1.43

 
$
1.47

 
$
0.76

(1)
Pre-acquisition net income allocated to the general partner relates to operations of the Water Assets for periods prior to their acquisition.
(2)
Diluted weighted-average limited partner common units includes the effect of 9,124, 9,083, 243,835 and 107,108 units for the period from November 13, 2017 to December 31, 2017, the period from January 1, 2017 to November 12, 2017 and for the years ended December 31, 2016 and 2015, respectively.
(3) Basic and diluted income per limited partner unit is presented as if all earnings for the period had been distributed. While it appears that more income is allocated to the subordinated unitholders than the common unitholders for the year ended December 31, 2016, the Partnership’s partnership agreement prevents the Partnership from making a distribution to the subordinated unitholders in excess of those to the common unitholders.
For any quarter in which the Partnership has distributed cash from operating surplus to the common unitholders in an amount equal to the minimum distribution, then the Partnership will distribute any additional available cash from operating surplus for that quarter among the unitholders and the incentive distribution rights holders in the following manner:
 
 
 
Marginal Percentage Interest in Distributions
 
Total Quarterly Distribution Per Unit
 
Unitholders
 
Incentive Distribution Rights Holders
Minimum Quarterly Distribution
$0.1875
 
100%
 
—%
First Target Distribution
above $0.1875 up to $0.2156
 
100%
 
—%
Second Target Distribution
above $0.2156 up to $0.2344
 
85%
 
15%
Third Target Distribution
above $0.2344 up to $0.2813
 
75%
 
25%
Thereafter
above $0.2813
 
50%
 
50%
The Board of Directors of the Partnership’s general partner declared the following cash distributions to the Partnership’s common and subordinated unitholders for the periods presented.
Quarters Ended
 
Total Quarterly Distribution per Unit
 
Date of Distribution
March 31, 2016
 
$
0.2100

 
May 12, 2016
June 30, 2016
 
$
0.2235

 
August 11, 2016
September 30, 2016
 
$
0.2370

 
November 10, 2016
December 31, 2016
 
$
0.2505

 
February 16, 2017
March 31, 2017
 
$
0.2608

 
May 18, 2017
June 30, 2017
 
$
0.2711

 
August 17, 2017
September 30, 2017
 
$
0.2814

 
November 16, 2017
December 31, 2017
 
$
0.2917

 
February 14, 2018
Financial Information by Business Segment (Tables)
Schedule of Segment Reporting Information, by Segment
The operating results and assets of the Partnership’s reportable segments were as follows for each respective period.
 
Successor
 
Period from November 13, 2017 to December 31, 2017
(in thousands)
Gathering and Compression
 
Water Services
 
Consolidated Total
Total operating revenues
$
30,614

 
$
13,605

 
$
44,219

Total operating expenses
8,814

 
9,460

 
18,274

Operating income
$
21,800

 
$
4,145

 
$
25,945

 
 
 
 
 
 
Segment assets
$
2,640,682

 
$
208,331

 
$
2,849,013

Depreciation expense
$
3,965

 
$
3,515

 
$
7,480

Capital expenditures for segment assets
$
28,320

 
$
6,233

 
$
34,553

 
Predecessor
 
Period from January 1, 2017 to November 12, 2017
(in thousands)
Gathering and Compression
 
Water Services
 
Consolidated Total
Total operating revenues
$
167,492

 
$
82,982

 
$
250,474

Total operating expenses
46,743

 
40,253

 
86,996

Operating income
$
120,749

 
$
42,729

 
$
163,478

 
 
 
 
 
 
Depreciation expense
$
11,324

 
$
15,096

 
$
26,420

Capital expenditures for segment assets
$
113,373

 
$
10,394

 
$
123,767

 
Predecessor
 
Year Ended December 31, 2016
(in thousands)
Gathering and Compression
 
Water Services
 
Consolidated Total
Total operating revenues
$
132,099

 
$
69,524

 
$
201,623

Total operating expenses
38,951

 
35,730

 
74,681

Operating income
$
93,148

 
$
33,794

 
$
126,942

 
 
 
 
 
 
Segment assets
$
1,260,681

 
$
138,536

 
$
1,399,217

Depreciation expense
$
10,840

 
$
14,330

 
$
25,170

Capital expenditures for segment assets
$
113,033

 
$
8,054

 
$
121,087

 
Predecessor
 
Year Ended December 31, 2015
(in thousands)
Gathering and Compression
 
Water Services
 
Consolidated Total
Total operating revenues
$
77,211

 
$
37,248

 
$
114,459

Total operating expenses
28,326

 
24,097

 
52,423

Operating income
$
48,885

 
$
13,151

 
$
62,036

 
 
 
 
 
 
Segment assets
$
547,810

 
$
141,980

 
$
689,790

Depreciation expense
$
6,310

 
$
10,089

 
$
16,399

Capital expenditures for segment assets
$
149,706

 
$
98,757

 
$
248,463

Quarterly Financial Information (Unaudited) (Tables)
Schedule of Quarterly Financial Information
The Partnership’s quarterly financial information for the years ended December 31, 2017 and 2016 is as follows (in thousands, except per unit data):
 
Predecessor
 
 
Successor
Year ended December 31, 2017: (1)
First
quarter
 
Second quarter
 
Third quarter
 
Period from October 1 to November 12
 
 
Period from November 13 to December 31
Operating revenues
$
62,750

 
$
72,377

 
$
81,701

 
$
33,646

 
 
$
44,219

Operating expenses
22,154

 
25,363

 
27,054

 
12,424

 
 
18,274

Operating income
40,596

 
47,014

 
54,647

 
21,222

 
 
25,945

Net income
$
37,615

 
$
44,060

 
$
51,454

 
$
19,710

 
 
$
25,134

Net income per limited partner unit - basic
$
0.36

 
$
0.42

 
$
0.48

 
$
0.18

 
 
$
0.23

Net income per limited partner unit - diluted
$
0.36

 
$
0.42

 
$
0.48

 
$
0.18

 
 
$
0.23

 
Predecessor
Year ended December 31, 2016: (1)
First
quarter
 
Second quarter
 
Third quarter
 
Fourth quarter (2)
Operating revenues
$
54,543

 
$
46,547

 
$
41,067

 
$
59,466

Operating expenses
18,926

 
17,547

 
15,531

 
22,677

Operating income
35,617

 
29,000

 
25,536

 
36,789

Net income
$
34,426

 
$
27,936

 
$
24,989

 
$
34,529

Net income per limited partner unit - basic
$
0.49

 
$
0.38

 
$
0.30

 
$
0.33

Net income per limited partner unit - diluted
$
0.48

 
$
0.38

 
$
0.30

 
$
0.33

(1)
The sum of quarterly data in some cases may not equal the yearly total due to rounding.
(2)
Includes the results of the Vantage Midstream Entities for the period from October 19, 2016 to December 31, 2016.
Mergers and Acquisitions (Allocation of Assets Acquired and Liabilities Assumed) (Details) (USD $)
In Thousands, unless otherwise specified
Dec. 31, 2017
Nov. 13, 2017
EQT RE, LLC
Business Acquisition [Line Items]
 
 
Estimated Value of RMP
 
$ 2,499,668 
Estimated Fair Value of Assets Acquired and Liabilities Assumed:
 
 
Current assets
 
65,300 
Property and equipment, net
 
1,419,077 
Other non-current assets
 
47 
Current liabilities
 
(56,351)
Revolving credit facility
 
(266,000)
Other non-current liabilities
 
(9,323)
Total estimated fair value of assets acquired and liabilities assumed
 
1,152,750 
Goodwill
$ 1,346,918 
$ 1,346,918 
Mergers and Acquisitions (Narrative) (Details) (USD $)
2 Months Ended 0 Months Ended
Dec. 31, 2017
Nov. 13, 2017
EQT RE, LLC
Oct. 19, 2016
Vantage Midstream Entities
Revolving Credit Facility
Oct. 19, 2016
Vantage Midstream Entities
Private Placement
Oct. 19, 2016
Vantage Midstream Entities
Subsidiary of Common Parent
Oct. 19, 2016
Vantage Midstream Entities
Subsidiary of Common Parent
mi
Business Acquisition [Line Items]
 
 
 
 
 
 
Number of miles of dry gas gathering and compression assets
 
 
 
 
 
30 
Aggregate purchase price
 
 
 
 
$ 600,000,000 
 
Net proceeds from private placement
 
 
441,000,000 
 
 
Proceeds from borrowings
20,000,000 
 
159,000,000 
 
 
 
Property and equipment, net
 
1,419,077,000 
 
 
 
144,600,000 
Net working capital
 
 
 
 
 
400,000 
Goodwill
$ 1,346,918,000 
$ 1,346,918,000 
 
 
 
$ 455,000,000 
Mergers and Acquisitions (Schedule of Post-Acquisition Operating Results and Pro Forma Information) (Details) (Subsidiary of Common Parent, Vantage Midstream Entities, USD $)
In Thousands, except Per Share data, unless otherwise specified
2 Months Ended 3 Months Ended 10 Months Ended 12 Months Ended
Dec. 31, 2017
Dec. 31, 2016
Predecessor
Nov. 12, 2017
Predecessor
Dec. 31, 2016
Predecessor
Dec. 31, 2015
Predecessor
Dec. 31, 2016
Predecessor
Common Units
Dec. 31, 2015
Predecessor
Common Units
Dec. 31, 2016
Predecessor
Subordinated
Dec. 31, 2015
Predecessor
Subordinated
Business Acquisition [Line Items]
 
 
 
 
 
 
 
 
 
Operating revenues
$ 6,529 
$ 8,571 
$ 51,190 
 
 
 
 
 
 
Net income
5,412 
4,303 
38,200 
 
 
 
 
 
 
Operating revenues
 
 
 
253,817 
156,944 
 
 
 
 
Limited partner net income
 
 
 
$ 150,846 
$ 67,199 
 
 
 
 
Earnings per common unit (basic) (in dollars per unit)
 
 
 
 
 
$ 1.54 
$ 0.84 
 
 
Earnings per common unit (diluted) (in dollars per unit)
 
 
 
 
 
$ 1.54 
$ 0.83 
 
 
Earnings per subordinated units (in dollars per unit)
 
 
 
 
 
 
 
$ 1.55 
$ 0.84 
Revolving Credit Facility (Narrative) (Details) (USD $)
12 Months Ended
Dec. 31, 2017
Dec. 31, 2016
Predecessor
Dec. 31, 2017
Revolving Credit Facility
Minimum
Dec. 31, 2017
Revolving Credit Facility
Maximum
Dec. 31, 2017
Revolving Credit Facility
London Interbank Offered Rate (LIBOR)
Minimum
Dec. 31, 2017
Revolving Credit Facility
London Interbank Offered Rate (LIBOR)
Maximum
Dec. 31, 2017
Revolving Credit Facility
Federal Funds Rate
Dec. 31, 2017
Revolving Credit Facility
One Month Eurodollar
Dec. 31, 2017
Revolving Credit Facility
One Month Eurodollar, Additional Margin
Minimum
Dec. 31, 2017
Revolving Credit Facility
One Month Eurodollar, Additional Margin
Maximum
Dec. 31, 2017
Revolving Credit Facility
Wells Fargo Bank, N.A.
Dec. 31, 2017
Revolving Credit Facility
Wells Fargo Bank, N.A.
Letter of Credit
Debt Instrument [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
Maximum credit amount
 
 
 
 
 
 
 
 
 
 
$ 850,000,000.0 
 
Additional commitments available under accordion feature
 
 
 
 
 
 
 
 
 
 
200,000,000.0 
 
Revolving credit facility
286,000,000 
190,000,000 
 
 
 
 
 
 
 
 
286,000,000 
1,000,000 
Amount of availability under facility
 
 
 
 
 
 
 
 
 
 
563,000,000 
 
Average daily balance of the credit facility
 
 
 
 
 
 
 
 
 
 
$ 216,000,000 
 
Weighted average annual interest rate percentage
 
 
 
 
 
 
 
 
 
 
3.10% 
 
Applicable margin (basis points)
 
 
 
 
2.00% 
3.00% 
0.50% 
1.00% 
1.00% 
2.00% 
 
 
Commitment fee based on undrawn commitment (basis points)
 
 
0.375% 
0.50% 
 
 
 
 
 
 
 
 
Consolidated current interest expense ratio
 
 
 
 
 
 
 
 
 
 
2.50 
 
Consolidated total leverage ratio
 
 
 
 
 
 
 
 
 
 
4.75 
 
Consolidated total leverage ratio after electing to issue senior unsecured notes
 
 
 
 
 
 
 
 
 
 
5.25 
 
Consolidated senior secured leverage ratio
 
 
 
 
 
 
 
 
 
 
3.50 
 
Commitments and Contingencies (Details) (Compression equipment, USD $)
In Millions, unless otherwise specified
2 Months Ended 10 Months Ended 12 Months Ended
Dec. 31, 2017
Dec. 31, 2017
Operation and Maintenance Expense
Nov. 12, 2017
Predecessor
Operation and Maintenance Expense
Dec. 31, 2016
Predecessor
Operation and Maintenance Expense
Dec. 31, 2015
Predecessor
Operation and Maintenance Expense
Other Commitments [Line Items]
 
 
 
 
 
Rent expense
 
$ 0.3 
$ 1.2 
$ 1.6 
$ 1.7 
Future payments for equipment
3.6 
 
 
 
 
2018
1.2 
 
 
 
 
2019
1.2 
 
 
 
 
2020
0.6 
 
 
 
 
2021
0.3 
 
 
 
 
2022
$ 0.3 
 
 
 
 
Partners' Capital (Schedule of Common and Subordinated Units Issued) (Details) (USD $)
12 Months Ended 12 Months Ended 0 Months Ended 12 Months Ended
Dec. 31, 2017
Dec. 31, 2016
May 31, 2016
ATM Program
Dec. 31, 2016
Equity offering in June 2016
Dec. 31, 2016
Equity offering in October 2016
Dec. 31, 2016
Common units issued under at the market program
Dec. 31, 2017
Common
Limited Partners
Dec. 31, 2016
Common
Limited Partners
Dec. 31, 2016
Common
Limited Partners
Equity offering in June 2016
Dec. 31, 2016
Common
Limited Partners
Equity offering in October 2016
Dec. 31, 2016
Common
Limited Partners
Common units issued under at the market program
Dec. 31, 2017
Subordinated
Limited Partners
Dec. 31, 2016
Subordinated
Limited Partners
Dec. 31, 2016
Subordinated
Limited Partners
Equity offering in June 2016
Dec. 31, 2016
Subordinated
Limited Partners
Equity offering in October 2016
Dec. 31, 2016
Subordinated
Limited Partners
Common units issued under at the market program
Dec. 31, 2017
Limited Partners
GP Holdings
Dec. 31, 2016
Limited Partners
GP Holdings
Dec. 31, 2015
Limited Partners
GP Holdings
Dec. 31, 2017
Limited Partners
GP Holdings
Increase (Decrease) in Partners' Capital [Roll Forward]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Balance (in units)
102,272,756 
70,917,372 
 
 
 
 
73,519,133 
42,163,749 
 
 
 
28,753,623 
28,753,623 
 
 
 
 
 
 
 
Equity offering and common units issued (in units)
 
 
 
9,200,000 
20,930,233 
944,700 
 
 
9,200,000 
20,930,233 
944,700 
 
 
 
 
 
 
Vested phantom units, net (in units)
30,352 
280,451 
 
 
 
 
30,352 
280,451 
 
 
 
 
 
 
 
 
 
 
Balance (in units)
102,303,108 
102,272,756 
 
 
 
 
73,549,485 
73,519,133 
 
 
 
28,753,623 
28,753,623 
 
 
 
 
 
 
 
Ownership %
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
28.00% 
28.00% 
41.00% 
28.00% 
Equity distribution agreement
 
 
$ 100,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Partners' Capital (Details)
0 Months Ended 12 Months Ended
Dec. 31, 2017
Dec. 31, 2016
Dec. 31, 2015
Dec. 31, 2017
Common
 
 
 
 
Subsidiary, Sale of Stock [Line Items]
 
 
 
 
Common and Subordinated units outstanding (in units)
73,549,485 
 
 
73,549,485 
Subordinated
 
 
 
 
Subsidiary, Sale of Stock [Line Items]
 
 
 
 
Common and Subordinated units outstanding (in units)
28,753,623 
 
 
28,753,623 
GP Holdings |
Limited Partners
 
 
 
 
Subsidiary, Sale of Stock [Line Items]
 
 
 
 
Ownership %
28.00% 
28.00% 
41.00% 
28.00% 
GP Holdings |
Common |
Limited Partners
 
 
 
 
Subsidiary, Sale of Stock [Line Items]
 
 
 
 
Common and Subordinated units outstanding (in units)
3,623 
 
 
3,623 
GP Holdings |
Subordinated |
Limited Partners
 
 
 
 
Subsidiary, Sale of Stock [Line Items]
 
 
 
 
Common and Subordinated units outstanding (in units)
28,753,623 
 
 
28,753,623 
Phantom Unit Awards (Details) (LTIP, Phantom unit awards, USD $)
In Millions, except Share data, unless otherwise specified
12 Months Ended 10 Months Ended 12 Months Ended
Dec. 31, 2017
Dec. 31, 2016
Nov. 12, 2017
General and Administrative Expense
Predecessor
Dec. 31, 2016
General and Administrative Expense
Predecessor
Dec. 31, 2015
General and Administrative Expense
Predecessor
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
 
 
 
Maximum aggregate number of common units that may be issued (in units)
5,000,000 
 
 
 
 
Award vesting period
1 year 
 
 
 
 
Equity compensation expense
 
 
$ 0.5 
$ 2.8 
$ 4.1 
Unrecorded compensation expense
$ 0.2 
 
 
 
 
Number of units
 
 
 
 
 
Total unvested, beginning balance (in units)
30,352 
432,628 
 
 
 
Granted (in units)
20,688 
30,352 
 
 
 
Vested (in units)
(30,352)
(399,158)
 
 
 
Forfeited (in units)
 
(33,470)
 
 
 
Total unvested, ending balance (in units)
20,688 
30,352 
 
 
 
Weighted average grant date fair value
 
 
 
 
 
Total unvested, beginning balance (in dollars per unit)
$ 17.81 
$ 16.52 
 
 
 
Granted (in dollars per unit)
$ 24.41 
$ 17.81 
 
 
 
Vested (in dollars per unit)
$ 17.81 
$ 16.52 
 
 
 
Forfeited (in dollars per unit)
 
$ 16.50 
 
 
 
Total unvested, ending balance (in dollars per unit)
$ 24.41 
$ 17.81 
 
 
 
Net Income per Limited Partner Unit and Cash Distributions (Schedule of Calculation of Net Income per Limited Partner Unit) (Details) (USD $)
In Thousands, except Share data, unless otherwise specified
2 Months Ended 1 Months Ended 3 Months Ended 10 Months Ended 12 Months Ended 10 Months Ended 12 Months Ended 10 Months Ended 12 Months Ended 10 Months Ended 12 Months Ended
Dec. 31, 2017
Dec. 31, 2017
Phantom unit awards
Dec. 31, 2017
Common
Dec. 31, 2017
Subordinated
Nov. 12, 2017
Predecessor
Sep. 30, 2017
Predecessor
Jun. 30, 2017
Predecessor
Mar. 31, 2017
Predecessor
Dec. 31, 2016
Predecessor
Sep. 30, 2016
Predecessor
Jun. 30, 2016
Predecessor
Mar. 31, 2016
Predecessor
Nov. 12, 2017
Predecessor
Dec. 31, 2016
Predecessor
Dec. 31, 2015
Predecessor
Nov. 12, 2017
Predecessor
Phantom unit awards
Dec. 31, 2016
Predecessor
Phantom unit awards
Dec. 31, 2015
Predecessor
Phantom unit awards
Nov. 12, 2017
Predecessor
Common
Dec. 31, 2016
Predecessor
Common
Dec. 31, 2015
Predecessor
Common
Nov. 12, 2017
Predecessor
Subordinated
Dec. 31, 2016
Predecessor
Subordinated
Dec. 31, 2015
Predecessor
Subordinated
Schedule of Earnings Per Share, Basic and Diluted, by Common Class, Including Two Class Method [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income
$ 25,134 
 
 
 
$ 19,710 
$ 51,454 
$ 44,060 
$ 37,615 
$ 34,529 
$ 24,989 
$ 27,936 
$ 34,426 
$ 152,839 
$ 121,610 
$ 52,495 
 
 
 
 
 
 
 
 
 
Less: Pre-acquisition net income allocated to general partner
 
 
 
 
 
 
 
 
 
 
 
7,296 
 
 
 
 
 
 
 
 
 
Less: General partner interest in net income attributable to incentive distribution rights
1,599 
 
 
 
 
 
 
 
 
 
 
 
6,182 
1,428 
 
 
 
 
 
 
 
 
 
Limited partner net income
$ 23,535 
 
$ 16,920 
$ 6,615 
 
 
 
 
 
 
 
 
$ 146,657 
$ 120,182 
$ 45,199 
 
 
 
$ 105,432 
$ 76,985 
$ 23,340 
$ 41,225 
$ 43,197 
$ 21,859 
Weighted-average limited partner units outstanding - basic:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Weighted-average limited partner units outstanding - basic (in units)
102,303,108 
 
73,549,485 
28,753,623 
 
 
 
 
 
 
 
 
102,289,037 
81,575,653 
59,454,487 
 
 
 
73,535,414 
52,822,030 
30,700,864 
28,753,623 
28,753,623 
28,753,623 
Weighted-average limited partner units outstanding - diluted:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Weighted-average limited partner units outstanding - diluted (in units)
102,312,232 
 
73,558,609 
28,753,623 
 
 
 
 
 
 
 
 
102,298,120 
81,819,488 
59,561,595 
 
 
 
73,544,497 
53,065,865 
30,807,972 
28,753,623 
28,753,623 
28,753,623 
Net income per limited partner unit - basic:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income per limited partner unit - basic (in dollars per unit)
$ 0.23 
 
$ 0.23 1
$ 0.23 
$ 0.18 
$ 0.48 
$ 0.42 
$ 0.36 
$ 0.33 
$ 0.30 
$ 0.38 
$ 0.49 
$ 1.43 
$ 1.47 
$ 0.76 
 
 
 
$ 1.43 1
$ 1.46 1
$ 0.76 1
$ 1.43 
$ 1.50 
$ 0.76 
Net income per limited partner unit - diluted:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income per limited partner unit - diluted (in dollars per unit)
$ 0.23 
 
$ 0.23 1
 
$ 0.18 
$ 0.48 
$ 0.42 
$ 0.36 
$ 0.33 
$ 0.30 
$ 0.38 
$ 0.48 
$ 1.43 
$ 1.47 
$ 0.76 
 
 
 
$ 1.43 1
$ 1.45 1
$ 0.76 1
$ 1.43 
$ 1.50 
$ 0.76 
Effect of units on diluted weighted-average limited partner common units (in units)
 
9,124 
 
 
 
 
 
 
 
 
 
 
 
 
 
9,083 
243,835 
107,108 
 
 
 
 
 
 
Net Income Per Limited Partner Unit and Cash Distributions (Subordinated Units) (Details) (Partnership Interest, Limited Partners, Scenario, Forecast, Subordinated)
0 Months Ended
Feb. 15, 2018
Partnership Interest |
Limited Partners |
Scenario, Forecast |
Subordinated
 
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items]
 
Units converted (in units)
28,753,623 
Conversion rate
Net Income per Limited Partner Unit and Cash Distributions (Incentive Distribution Rights) (Details) (USD $)
In Millions, except Per Share data, unless otherwise specified
0 Months Ended 12 Months Ended 0 Months Ended
Nov. 16, 2017
Aug. 17, 2017
May 18, 2017
Feb. 16, 2017
Nov. 10, 2016
Aug. 11, 2016
May 12, 2016
Dec. 31, 2017
Dec. 31, 2017
GP Holdings
Limited Partners
Dec. 31, 2016
GP Holdings
Limited Partners
Dec. 31, 2017
Minimum
Dec. 31, 2017
Maximum
Feb. 14, 2018
Subsequent Event
Incentive Distribution Made to Managing Member or General Partner [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
 
Distribution period
 
 
 
 
 
 
 
45 days 
 
 
 
 
 
Total Quarterly Distribution Per Unit
 
 
 
 
 
 
 
 
 
 
 
 
 
Minimum Quarterly Distribution (in dollars per unit)
 
 
 
 
 
 
 
$ 0.1875 
 
 
 
 
 
First Target Distribution (in dollars per unit)
 
 
 
 
 
 
 
 
 
 
$ 0.1875 
$ 0.2156 
 
Second Target Distribution (in dollars per unit)
 
 
 
 
 
 
 
 
 
 
$ 0.2156 
$ 0.2344 
 
Third Target Distribution (in dollars per unit)
 
 
 
 
 
 
 
 
 
 
$ 0.2344 
$ 0.2813 
 
Thereafter (in dollars per unit)
 
 
 
 
 
 
 
 
 
 
$ 0.2813 
 
 
Unitholders
 
 
 
 
 
 
 
 
 
 
 
 
 
Minimum Quarterly Distribution
 
 
 
 
 
 
 
100.00% 
 
 
 
 
 
First Target Distribution (in units)
 
 
 
 
 
 
 
100.00% 
 
 
 
 
 
Second Target Distribution (in units)
 
 
 
 
 
 
 
85.00% 
 
 
 
 
 
Third Target Distribution (in units)
 
 
 
 
 
 
 
75.00% 
 
 
 
 
 
Thereafter (in units)
 
 
 
 
 
 
 
50.00% 
 
 
 
 
 
Incentive Distribution Rights Holders
 
 
 
 
 
 
 
 
 
 
 
 
 
Minimum Quarterly Distribution
 
 
 
 
 
 
 
0.00% 
 
 
 
 
 
First Target Distribution
 
 
 
 
 
 
 
0.00% 
 
 
 
 
 
Second Target Distribution
 
 
 
 
 
 
 
15.00% 
 
 
 
 
 
Third Target Distribution
 
 
 
 
 
 
 
25.00% 
 
 
 
 
 
Thereafter
 
 
 
 
 
 
 
50.00% 
 
 
 
 
 
Cash distribution
 
 
 
 
 
 
 
 
$ 5.7 
$ 0.5 
 
 
 
Total Quarterly Distribution per Unit (in dollars per unit)
$ 0.2814 
$ 0.2711 
$ 0.2608 
$ 0.2505 
$ 0.2370 
$ 0.2235 
$ 0.2100 
 
 
 
 
 
$ 0.2917 
Income Taxes (Narrative) (Details) (USD $)
2 Months Ended 12 Months Ended 0 Months Ended
Dec. 31, 2017
Dec. 31, 2016
tax_year
Dec. 31, 2015
Water Assets
Nov. 1, 2015
Deferred Tax Liability Eliminated through Equity
Water Assets
Income Taxes [Line Items]
 
 
 
 
Tax impact of acquisition of Water Assets
 
 
 
$ 7,700,000 
Income tax expense
$ 0 
 
$ 5,800,000 
 
Number of short tax years
 
 
 
Financial Information by Business Segment (Narrative) (Details)
12 Months Ended
Dec. 31, 2017
business_segment
Segment Reporting [Abstract]
 
Number of business segments
Financial Information by Business Segment (Schedule of Operating Results and Assets) (Details) (USD $)
In Thousands, unless otherwise specified
2 Months Ended 1 Months Ended 3 Months Ended 10 Months Ended 12 Months Ended 10 Months Ended 12 Months Ended 10 Months Ended 12 Months Ended
Dec. 31, 2017
Dec. 31, 2017
Gathering and Compression
Dec. 31, 2017
Water Services
Nov. 12, 2017
Predecessor
Sep. 30, 2017
Predecessor
Jun. 30, 2017
Predecessor
Mar. 31, 2017
Predecessor
Dec. 31, 2016
Predecessor
Sep. 30, 2016
Predecessor
Jun. 30, 2016
Predecessor
Mar. 31, 2016
Predecessor
Nov. 12, 2017
Predecessor
Dec. 31, 2016
Predecessor
Dec. 31, 2015
Predecessor
Nov. 12, 2017
Predecessor
Gathering and Compression
Dec. 31, 2016
Predecessor
Gathering and Compression
Dec. 31, 2015
Predecessor
Gathering and Compression
Nov. 12, 2017
Predecessor
Water Services
Dec. 31, 2016
Predecessor
Water Services
Dec. 31, 2015
Predecessor
Water Services
Segment Reporting Information [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Operating revenues
$ 44,219 
$ 30,614 
$ 13,605 
$ 33,646 
$ 81,701 
$ 72,377 
$ 62,750 
$ 59,466 
$ 41,067 
$ 46,547 
$ 54,543 
$ 250,474 
$ 201,623 
$ 114,459 
$ 167,492 
$ 132,099 
$ 77,211 
$ 82,982 
$ 69,524 
$ 37,248 
Operating expenses
18,274 
8,814 
9,460 
12,424 
27,054 
25,363 
22,154 
22,677 
15,531 
17,547 
18,926 
86,996 
74,681 
52,423 
46,743 
38,951 
28,326 
40,253 
35,730 
24,097 
Operating income
25,945 
21,800 
4,145 
21,222 
54,647 
47,014 
40,596 
36,789 
25,536 
29,000 
35,617 
163,478 
126,942 
62,036 
120,749 
93,148 
48,885 
42,729 
33,794 
13,151 
Segment assets
2,849,013 
2,640,682 
208,331 
 
 
 
 
1,399,217 
 
 
 
 
1,399,217 
689,790 
 
1,260,681 
547,810 
 
138,536 
141,980 
Depreciation expense
7,480 
3,965 
3,515 
 
 
 
 
 
 
 
 
26,420 
25,170 
16,399 
11,324 
10,840 
6,310 
15,096 
14,330 
10,089 
Capital expenditures for segment assets
$ 34,553 
$ 28,320 
$ 6,233 
 
 
 
 
 
 
 
 
$ 123,767 
$ 121,087 
$ 248,463 
$ 113,373 
$ 113,033 
$ 149,706 
$ 10,394 
$ 8,054 
$ 98,757 
Quarterly Financial Information (Unaudited) (Details) (USD $)
In Thousands, except Per Share data, unless otherwise specified
2 Months Ended 1 Months Ended 3 Months Ended 10 Months Ended 12 Months Ended
Dec. 31, 2017
Nov. 12, 2017
Predecessor
Sep. 30, 2017
Predecessor
Jun. 30, 2017
Predecessor
Mar. 31, 2017
Predecessor
Dec. 31, 2016
Predecessor
Sep. 30, 2016
Predecessor
Jun. 30, 2016
Predecessor
Mar. 31, 2016
Predecessor
Nov. 12, 2017
Predecessor
Dec. 31, 2016
Predecessor
Dec. 31, 2015
Predecessor
Interim Period, Costs Not Allocable [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
Operating revenues
$ 44,219 
$ 33,646 
$ 81,701 
$ 72,377 
$ 62,750 
$ 59,466 
$ 41,067 
$ 46,547 
$ 54,543 
$ 250,474 
$ 201,623 
$ 114,459 
Operating expenses
18,274 
12,424 
27,054 
25,363 
22,154 
22,677 
15,531 
17,547 
18,926 
86,996 
74,681 
52,423 
Operating income
25,945 
21,222 
54,647 
47,014 
40,596 
36,789 
25,536 
29,000 
35,617 
163,478 
126,942 
62,036 
Net income
$ 25,134 
$ 19,710 
$ 51,454 
$ 44,060 
$ 37,615 
$ 34,529 
$ 24,989 
$ 27,936 
$ 34,426 
$ 152,839 
$ 121,610 
$ 52,495 
Net income per limited partner unit - basic (in dollars per unit)
$ 0.23 
$ 0.18 
$ 0.48 
$ 0.42 
$ 0.36 
$ 0.33 
$ 0.30 
$ 0.38 
$ 0.49 
$ 1.43 
$ 1.47 
$ 0.76 
Net income per limited partner unit - diluted (in dollars per unit)
$ 0.23 
$ 0.18 
$ 0.48 
$ 0.42 
$ 0.36 
$ 0.33 
$ 0.30 
$ 0.38 
$ 0.48 
$ 1.43 
$ 1.47 
$ 0.76