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Note 4 - Discontinued Operations

3 Months Ended

Mar. 31, 2022

Notes to Financial Statements

Disposal Groups, Including Discontinued Operations, Disclosure [Text Block]

4.	DISCONTINUED OPERATIONS

On December 21, 2020, the Partnership announced that it entered into agreements to sell its crude oil trucking services, crude oil pipeline services, and crude oil terminalling services segments. These segments are reported as discontinued operations in the results of operations and financial position for all periods presented. The crude oil trucking services agreement closed in two phases, one on December 15, 2020, and one on February 2, 2021. The crude oil pipeline services agreement closed on February 1, 2021. Loss recognized on the classification of held for sale and disposal of these assets was recorded in the year ended December 31, 2020. The transaction related to the crude oil terminalling services segment closed on March 1, 2021. The Partnership has allocated interest to discontinued operations on debt that was required to be repaid as a result of the sales of the crude oil pipeline and terminalling services segments for the three months ended March 31, 2021.

As part of the crude oil pipeline sale, $1.2 million of the gross sale proceeds are currently being held in escrow, subject to post-closing settlement terms and conditions. The Partnership expects to receive the majority of this in increments over the two years following the date of sale.

Exit and disposal costs related to these sales, in the form of employee severance payments, totaled $1.9 million. The Partnership provided limited transition services to both of the buyers of the crude oil pipeline and terminalling services segments, with the final transition services being completed during the third quarter of 2021. The contracts were designed to recover the costs of providing services, so there is minimal income statement impact for these services.

Assets and Liabilities of Discontinued Operations (in thousands)		*As of December 31, 2021*
		*Crude Oil Trucking Services*				*Crude Oil Pipeline Services*				*Crude Oil Terminalling Services*				*Total*
ASSETS
Other assets			-				1				1				2
Total assets of discontinued operations		$	-			$	1			$	1			$	2

LIABILITIES
Current liabilities		$	12			$	218			$	10			$	240
Total liabilities of discontinued operations		$	12			$	218			$	10			$	240

Statement of Operations for Discontinued Operations (in thousands)			*Three Months Ended March 31, 2021*
		*Crude Oil Trucking Services*				*Crude Oil Pipeline Services*				*Crude Oil Terminalling Services*				*Total*
Revenue:
Third-party service revenue		$	9			$	413			$	3,643			$	4,065
Intercompany service revenue			409				-				-				409
Third-party product sales revenue			-				15,591				-				15,591
Costs and expenses:
Operating expense			1,333				1,438				910				3,681
Intercompany operating expense			-				409				-				409
Cost of product sales			-				4,994				-				4,994
Cost of product sales from related party			-				9,461				-				9,461
General and administrative expense			59				118				-				177
Tangible asset impairment expense			92				41				23				156
Gain on disposal of assets			(3	)			(1,694	)			(73,372	)			(75,069	)
Interest expense			-				72				634				706
Income (loss) before income taxes			(1,063	)			1,165				75,448				75,550
Provision for income taxes			-				-				-				-
Net income (loss) from discontinued operations		$	(1,063	)		$	1,165			$	75,448			$	75,550

Select cash flow information (in thousands)
		*Crude Oil Trucking Services*				*Crude Oil Pipeline Services*				*Crude Oil Terminalling Services*				*Total*
		*Three Months Ended March 31, 2021*
Amortization		$	3			$	14			$	15			$	32
Capital expenditures		$	-			$	10			$	109			$	119