Leases

12 Months Ended

Dec. 31, 2016

Leases [Abstract]

Leases of Lessee Disclosure

Lessee

We lease a wide variety of facilities and equipment under operating leases, including land and building space, office equipment, storage facilities and transportation equipment. Most long-term leases include renewal options and, in certain leases, purchase options. Future minimum commitments as of December 31, 2016, for capital lease obligations and for operating lease obligations having initial or remaining non-cancellable lease terms in excess of one year are as follows:

(In millions)	Capital Lease Obligations		Operating Lease Obligations
2017	$	50	$	254
2018	50		211
2019	45		198
2020	49		188
2021	45		170
Later years	206		569
Total minimum lease payments	445		$	1,590
Less imputed interest costs	126
Present value of net minimum lease payments	$	319

Operating lease rental expense was:

(In millions)	2016		2015		2014
Rental expense	$	327	$	331	$	256

Leases of Lessor Disclosure

Lessor

MPLX has certain natural gas gathering, transportation and processing agreements in which it is considered to be the lessor under several implicit operating lease arrangements in accordance with US GAAP. MPLX’s primary implicit lease operations relate to a natural gas gathering agreement in the Marcellus region for which it earns a fixed-fee for providing gathering services to a single producer using a dedicated gathering system. As the gathering system is expanded, the fixed-fee charged to the producer is adjusted to include the additional gathering assets in the lease. The primary term of the natural gas gathering arrangement expires in 2023 and will continue thereafter on a year to year basis until terminated by either party. Other significant implicit leases relate to a natural gas processing agreement in the Marcellus region and a natural gas processing agreement in the Southern Appalachia region for which MPLX earns minimum monthly fees for providing processing services to a single producer using a dedicated processing plant. The primary term of these natural gas processing agreements expire during 2023 and 2030.

Our revenue from implicit lease arrangements, excluding executory costs, totaled approximately $246 million, $16 million and $0 million in 2016, 2015 and 2014, respectively. The implicit lease arrangements related to the processing facilities contain contingent rental provisions whereby we receive additional fees if the producer customer exceeds the monthly minimum processed volumes. During the year ended December 31, 2016, we received $7 million in contingent lease payments and less than $1 million for the year ended December 31, 2015. The following is a schedule of minimum future rentals on the non‑cancellable operating leases as of December 31, 2016:

(In millions)
2017	$	197
2018	200
2019	202
2020	201
2021	185
Later years	460
Total minimum lease payments	$	1,445

The following schedule summarizes our investment in assets held for operating lease by major classes as of December 31, 2016:

(In millions)
Natural gas gathering and NGL transportation pipelines and facilities	$	650
Natural gas processing facilities	844
Construction in progress	219
Property, plant and equipment	1,713
Less accumulated depreciation	84
Total property, plant and equipment	$	1,629