Related Party Transactions

9 Months Ended

Sep. 30, 2014

Related Party Transactions [Abstract]

Related Party Transactions Disclosure [Text Block]

14. Related Party Transactions

Certain of our employees are shared employees with Western. At the closing of the Offering, we entered into a services agreement with Western under which Western agreed to share certain employees with us. These employees are responsible for operation, maintenance and other services related to the assets we own and operate. Western employees provide these services under our direction, supervision and control pursuant to this services agreement. Western also provides us with support for accounting, legal, human resources and various other administrative functions.

Under the services agreement, we have incurred indirect charges for executive oversight, accounting, treasury, tax, legal, procurement, engineering, logistics, maintenance and information technology and similar items. We have classified these indirect charges between general and administrative expenses and operating and maintenance expenses based on the functional nature of the services being performed for our operations. Indirect charges were as follows:

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2014		2013		2014		2013
	(In thousands)
Indirect charges:
General and administrative expenses	$	1,198	$	1,148	$	5,316	$	3,338
Operating and maintenance expenses	8,194		4,303		24,255		12,451
Total indirect charges	$	9,392	$	5,451	$	29,571	$	15,789

Our management believes the indirect charges allocated to us are a reasonable reflection of the utilization of services provided. However, these allocations may not fully reflect the expenses that we would have incurred had we been a stand-alone company during the periods presented.

Agreements with Western

We derive substantially all of our revenues through various pipeline transportation, terminal distribution and storage services under long-term, fee-based commercial agreements with Western that expire in 2023. These agreements contain minimum volume commitments. Each agreement has fees that are indexed for inflation and provides the parties with options to renew for two additional five-year terms upon mutual consent.

In addition to the commercial agreements, we are also party to a services agreement and an omnibus agreement with Western, as described above, that, among other things, provides for reimbursement to Western for various general and administrative services provided to us. We are also party to an operational services agreement with Western under which we reimburse for personnel services provided by Western in support of the operations of our pipelines, terminals and storage facilities.

We entered into three separate ground lease and access agreements with Western. All three agreements are for 10-year terms with provision for automatic renewal of up to four consecutive 10-year periods. Under each separate agreement, WNRL pays nominal annual rents. Rents due under these three agreements in the aggregate are less than $0.1 million over the initial terms of the agreements.

Subsequent to September 30, 2014, we entered into a product supply agreement, a fuel distribution and supply agreement and a crude oil trucking transportation service agreement with Western. See Note 15, Subsequent Eventsfor additional information.