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Leases (Tables)

6 Months Ended

Jun. 30, 2022

Summary of supplemental balance sheet information related to leases

The Company’s lease assets and liabilities consisted of the following items (in thousands):


				(Unaudited)
		December 31,		June 30,
Leases	Balance Sheet Classification	2021		2022
Operating Leases
Operating lease right-of-use assets:
Processing plants	Operating lease right-of-use assets	$	1,739,550		1,644,040
Drilling rigs and completion services	Operating lease right-of-use assets		9,860		79,350
Gas gathering lines and compressor stations ⁽¹⁾	Operating lease right-of-use assets		1,634,928		1,583,204
Office space	Operating lease right-of-use assets		33,083		42,987
Vehicles	Operating lease right-of-use assets		2,009		1,389
Other office and field equipment	Operating lease right-of-use assets		482		4,652
Total operating lease right-of-use assets		$	3,419,912		3,355,622

Short-term operating lease obligation	Short-term lease liabilities	$	455,950		506,459
Long-term operating lease obligation	Long-term lease liabilities		2,963,962		2,849,163
Total operating lease obligation		$	3,419,912		3,355,622

Finance Leases
Finance lease right-of-use assets:
Vehicles	Other property and equipment	$	550		700
Total finance lease right-of-use assets ⁽²⁾		$	550		700

Short-term finance lease obligation	Short-term lease liabilities	$	397		265
Long-term finance lease obligation	Long-term lease liabilities		153		435
Total finance lease obligation		$	550		700

(1)	Gas gathering lines and compressor stations leases includes $1.5 billion related to Antero Midstream as of December 31, 2021 and June 30, 2022. See “—Related party lease disclosure” for additional discussion.

(2)	Financing lease assets are recorded net of accumulated amortization of $2 million and $1 million as of December 31, 2021 and June 30, 2022, respectively.

Summary of costs associated with operating leases and finance leases

Costs associated with operating and finance leases were included in the unaudited condensed consolidated statement of operations and comprehensive loss (in thousands):


			Three Months Ended June 30,				Six Months Ended June 30,
Cost	Classification	Location	2021		2022		2021		2022
Operating lease cost	Statement of operations	Gathering, compression, processing and transportation	$	385,022		365,343		761,952		731,177
Operating lease cost	Statement of operations	General and administrative		2,736		2,787		5,224		5,654
Operating lease cost	Statement of operations	Contract termination		844		—		844		—
Operating lease cost	Statement of operations	Lease operating		44		44		66		89
Operating lease cost	Balance sheet	Proved properties ⁽¹⁾		28,432		41,100		57,191		48,859
Total operating lease cost			$	417,078		409,274		825,277		785,779

Finance lease cost:
Amortization of right-of-use assets	Statement of operations	Depletion, depreciation and amortization	$	132		107		259		225
Interest on lease liabilities	Statement of operations	Interest expense		23		51		51		65
Total finance lease cost			$	155		158		310		290

Short-term lease payments			$	24,456		28,348		41,298		77,108

(1)	Capitalized costs related to drilling and completion activities.

Summary of supplemental cash flow information related to leases

The following table presents the Company’s supplemental cash flow information related to leases (in thousands):


	Six Months Ended June 30,
	2021		2022
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	716,582		675,563
Investing cash flows from operating leases		44,747		39,781
Financing cash flows from finance leases		509		277

Noncash activities:
Right-of-use assets obtained in exchange for new operating lease obligations	$	6,849		215,157
Increase (decrease) to existing right-of-use assets and lease obligations from operating lease modifications, net ⁽¹⁾	$	(2,612)		(47,728)

(1)

During the six months ended June 30, 2021, the weighted average discount rate for remeasured operating leases decreased from 5.9% as of December 31, 2020 to 4.1% as of June 30, 2021. During the six months ended June 30, 2022, the weighted average discount rate for remeasured operating leases increased from 4.5% as of December 31, 2021 to 5.1% as of June 30, 2022.

Summary of maturities of operating lease liabilities

The table below is a schedule of future minimum payments for operating and financing lease liabilities as of June 30, 2022 (in thousands):


	Operating Leases		Financing Leases		Total
Remainder of 2022	$	347,588		221		347,809
2023		680,572		215		680,787
2024		619,383		207		619,590
2025		558,900		165		559,065
2026		508,199		36		508,235
2027		415,958		—		415,958
Thereafter		1,069,257		—		1,069,257
Total lease payments		4,199,857		844		4,200,701
Less: imputed interest		(844,235)		(144)		(844,379)
Total	$	3,355,622		700		3,356,322

Summary of maturities of financing lease liabilities

The table below is a schedule of future minimum payments for operating and financing lease liabilities as of June 30, 2022 (in thousands):


	Operating Leases		Financing Leases		Total
Remainder of 2022	$	347,588		221		347,809
2023		680,572		215		680,787
2024		619,383		207		619,590
2025		558,900		165		559,065
2026		508,199		36		508,235
2027		415,958		—		415,958
Thereafter		1,069,257		—		1,069,257
Total lease payments		4,199,857		844		4,200,701
Less: imputed interest		(844,235)		(144)		(844,379)
Total	$	3,355,622		700		3,356,322

Summary of weighted-average remaining lease term and discount rate


					(Unaudited)
	December 31, 2021				June 30, 2022
	Operating Leases		Finance Leases		Operating Leases		Finance Leases
Weighted average remaining lease term	7.6 years		1.9 years		7.3 years		3.1 years
Weighted average discount rate	5.5	%	5.6	%	5.8	%	6.0	%