Equity Method Investments

12 Months Ended

Dec. 31, 2019

Equity Method Investments [Abstract]

21. EQUITY METHOD INVESTMENTS

Green Plains Cattle Company LLC

On September 1, 2019, the company formed a joint venture with TGAM and StepStone. Such parties entered into the Second Amended and Restated Limited Liability Company Agreement of GPCC effective as of September 1, 2019. GPCC was previously a wholly owned subsidiary of Green Plains. Green Plains also entered into a Securities Purchase Agreement with TGAM and StepStone, whereby TGAM and StepStone purchased an aggregate of 50% of the membership interests of GPCC from Green Plains. After closing, GPCC is no longer consolidated in the company’s consolidated financial statements and the GPCC investment is accounted for using the equity method of accounting. GPCC results prior to its disposition are classified as discontinued operations in our current and prior period financials.

GPCC conducts the business of the joint venture, including (i) owning and operating the cattle feeding operations (as defined below), and (ii) any other activities approved by GPCC’s board of managers. GPCC continues to have the capacity to support 355,000 head of cattle and has approximately 24.1 million bushels of grain storage capacity.

The company does not consolidate any part of the assets or liabilities or operating results of its equity method investee. The company’s share of net income or loss in the investee increases or decreases, as applicable, the carrying value of the investment. With respect to GPCC, the company determined that this entity does not represent a variable interest entity and consolidation is not required. In addition, although the company has the ability to exercise significant influence over the joint venture through board representation and voting rights, all significant decisions require the consent of the other investors without regard to economic interest.

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Summarized Financial Information

During the periods ended December 31, 2019 and 2018, our equity method investees were considered related parties and included:

Green Plains Cattle Company LLC, a joint venture formed on September 1, 2019, in which we have a 50% noncontrolling interest. See description of GPCC above.

JGP Energy Partners LLC, in which we owned a 50% noncontrolling interest, until the sale of our 50% noncontrolling interest during the fourth quarter of 2019. JGP Energy Partners LLC operates an intermodal export and import fuels terminal in Beaumont, Texas, with storage capacity of 550 thousand barrels to support various export and domestic grades of ethanol. In addition, we recognized a gain within other income of $4.8 million related to the sale of our 50% interest in JGP Energy Partners LLC.

Optimal Aqua LLC, in which we have a 50% noncontrolling interest. Optimal Aqua LLC produces high-quality aquaculture feeds utilizing proprietary techniques and high-protein feed ingredients.

NLR Energy Logistics LLC, in which the partnership has a 50% noncontrolling interest. NLR Energy Logistics LLC operates a unit train terminal in the Little Rock, Arkansas area with capacity to unload 110-unit cars and provide approximately 100,000 barrels of storage.

Our equity method investments are summarized in the following table (in thousands):


	Ownership as of	Year Ended December 31,
	December 31, 2019	2019		2018
Green Plains Cattle Company LLC ⁽¹⁾	50%	$	64,161	$	-
JGP Energy Partners LLC ⁽²⁾	0%		-		25,362
Optimal Aqua LLC	50%		508		704
NLR Energy Logistics LLC	50%		4,329		3,648
Total		$	68,998	$	29,714

(1)The equity method investment in GPCC is offset by the impact of AOCI.

(2)On December 11, 2019, the company completed the sale of our 50% joint venture interest in JGP Energy Partners LLC.

Earnings from equity method investments, net of income taxes, were as follows:


	Year Ended December 31,
	2019		2018		2017
Green Plains Cattle Company LLC ⁽¹⁾	$	2,839	$	-	$	-
NLR Energy Logistics LLC		516		(13)		(11)
All others		(558)		(583)		(263)
Total income (loss) from equity method investments, net of income taxes	$	2,797	$	(596)	$	(274)

Distributions from equity method investments	$	320	$	-	$	-

Earnings from equity method investments, net of distributions	$	2,477	$	(596)	$	(274)

(1)Pretax equity method earnings of GPCC were $3.8 million during the four months ended December 31, 2019.

The company reports its proportional share of equity method investment income (loss) in the consolidated statements of operations. The company’s share of equity method investees other comprehensive income arising during the period is included in accumulated other comprehensive loss in the consolidated balance sheet.

The following tables present summarized financial information of GPCC.


	Four Months Ended December 31, 2019
Total revenues	$	370,383
Total operating expenses		362,878
Net income	$	7,505

	December 31, 2019
Balance sheet:
Current assets	$	516,324
Noncurrent assets		73,922
Current liabilities		461,534
Noncurrent liabilities		390
Net assets	$	128,322