Related party transactions include transactions with SPLC and Shell, including those entities in which Shell has an ownership interest but does not have control. See Note 16 – Subsequent Event(s) – Take Private Proposal for additional information regarding the non-binding, preliminary proposal letter that the Board of Directors of our general partner (the “Board”) received from SPLC to acquire all of the Partnership’s issued and outstanding common units not already owned by SPLC or its affiliates.

On February 27, 2020, we and our general partner entered into the Partnership Interests Restructuring Agreement, effective April 1, 2020, pursuant to which the IDRs were eliminated and the 2% general partner economic interest was converted into a non-economic general partner interest in the Partnership. See Note 3 — Acquisitions and Other Transactions for additional details.

On February 27, 2020, we entered into the Purchase and Sale Agreement by and among Triton, SPLC, SGOM, Shell Chemical and SOPUS, effective April 1, 2020, pursuant to which we acquired 79% of the issued and outstanding membership interests in Mattox from SGOM and SOPUS and Shell Chemical transferred to Triton, as a designee of the Partnership, the Norco Assets.

We, our general partner, SPLC and the Operating Company entered into an Omnibus Agreement effective February 1, 2019 (the “2019 Omnibus Agreement”). On February 16, 2021, pursuant to the 2019 Omnibus Agreement, the Board approved a decrease in the annual general and administrative fee to $10 million for 2021, based on a change in the cost of the services provided.

•our obligation to reimburse SPLC for all expenses incurred by SPLC as a result of us becoming and continuing as a publicly-traded entity; we will reimburse our general partner for these expenses to the extent the fees relating to such services are not included in the general and administrative fee.

We, our general partner and SPLC entered into a Trade Marks License Agreement with Shell Trademark Management Inc. effective as of February 1, 2019. The Trade Marks License Agreement grants us the use of certain Shell trademarks and trade names and expires on January 1, 2024 unless earlier terminated by either party upon 360 days’ notice.

We have entered into a tax sharing agreement with Shell. Pursuant to this agreement, we have agreed to reimburse Shell for state and local income and franchise taxes attributable to any activity of our operating subsidiaries and reported on Shell’s state or local income or franchise tax returns filed on a combined or unitary basis. Reimbursements under this agreement equal the amount of tax our applicable operating subsidiaries would be required to pay with respect to such activity, if such subsidiaries were to file a combined or unitary tax return separate from Shell. Shell will compute and invoice us for the tax reimbursement amount within 15 days of Shell filing its combined or unitary tax return on which such activity is included. We may be required to make prepayments toward the tax reimbursement amount to the extent that Shell is required to make estimated tax payments during the relevant tax year. The tax sharing agreement currently in place is effective for all taxable periods ending on or after December 31, 2017. The current agreement replaced a similar tax sharing agreement between Zydeco and Shell, which was effective for all tax periods ending before December 31, 2017. Reimbursements settled in the years ended December 31, 2021, 2020 and 2019 were not material to our consolidated statements of income.

On December 1, 2019, we entered into an Operating and Administrative Management Agreement with SPLC (the “2019 Operating Agreement”). Pursuant to the 2019 Operating Agreement, SPLC provides certain operations, maintenance and administrative services for the assets wholly owned by Pecten, Sand Dollar and Triton (collectively, the “Owners”). The Owners are required to reimburse SPLC for certain costs in connection with the services that SPLC provides pursuant to the 2019 Operating Agreement. SPLC and the Owners each provide standard indemnifications as operator and asset owners, respectively. Upon entering into the 2019 Operating Agreement, certain operating agreements previously entered into between SPLC and each of the Owners were terminated.

In December 2017, we were assigned an operating agreement for Odyssey, whereby SPLC performs physical operations and maintenance services and provides general and administrative services for Odyssey. Odyssey is required to reimburse SPLC for costs and expenses incurred in connection with such services. Also pursuant to the agreement, SPLC and Odyssey agree to standard indemnifications as operator and asset owner, respectively.

Beginning July 1, 2014, Zydeco entered into an operating and management agreement with SPLC under which SPLC provides general management and administrative services to us. Therefore, we do not receive allocated corporate expenses from SPLC or Shell under this agreement. We receive direct and allocated field and regional expenses including payroll expenses not covered under this agreement.

Concurrently with the execution of the Partnership Interests Restructuring Agreement, on April 1, 2020, we executed the Second Amended and Restated Partnership Agreement, which amended and restated the Partnership’s First Amended and Restated Agreement of Limited Partnership dated November 3, 2014 (“First Amended and Restated Partnership Agreement”, as the same was previously amended) in its entirety. Under the Second Amended and Restated Partnership Agreement, the IDRs were eliminated, the economic general partnership interest was converted into a non-economic general partner interest, and our general partner or its assignee agreed to waive a portion of the distributions that would otherwise have been payable on the common units issued to SPLC as part of the April 2020 Transaction, in an amount of $20 million per quarter for four consecutive fiscal quarters, beginning with the distribution made with respect to the second quarter of 2020 and ending with the distribution made with respect to the first quarter of 2021. The transaction closed simultaneously with the closing of the transactions described in Note 3 — Acquisitions and Other Transactions—April 2020 Transaction.

Prior to the execution of the Second Amended and Restated Partnership Agreement, on December 21, 2018, we executed Amendment No. 2 (the “Second Amendment”) to the First Amended and Restated Partnership Agreement. Under the Second Amendment, our general partner agreed to waive $50 million of distributions in 2019 by agreeing to reduce distributions to holders of the IDRs by: (1) $17 million for the three months ended March 31, 2019, (2) $17 million for the three months ended June 30, 2019 and (3) $16 million for the three months ended September 30, 2019.

For Zydeco, there is no non-controlling interest as of December 31, 2021 as a result of the May 2021 Transaction. Refer to Note 3 — Acquisitions and Other Transactions for additional information. The noncontrolling interest for Zydeco consisted of SPLC’s 7.5% retained ownership interest as of December 31, 2020 and 2019. For Odyssey, noncontrolling interest consists of GEL Offshore Pipeline LLC’s (“GEL”) 29.0% retained ownership interest as of December 31, 2021, 2020 and 2019.

Other related party balances consist of the following:


	December 31,
	2021		2020
Accounts receivable	$	40	$	21
Prepaid expenses	23		22
Other assets	2		2
Contract assets (1)	218		233
Accounts payable (2)	17		16
Deferred revenue	31		19
Accrued liabilities (3)	24		28
Debt payable (4)	2,692		2,692
Finance lease liability	2		2
Financing receivables (1)	293		298

(3) As of December 31, 2021, Accrued liabilities reflects $15 million of accrued interest and $9 million of other accrued liabilities. As of December 31, 2020, Accrued liabilities reflects $16 million of accrued interest and $12 million of other accrued liabilities. Other accrued liabilities are primarily related to the accrued operation and maintenance expenses on the Norco Assets.

We have entered into five credit facilities with STCW: the 2021 Ten Year Fixed Facility, the Ten Year Fixed Facility, the Seven Year Fixed Facility, the Five Year Revolver due July 2023, and the Five Year Revolver due December 2022. On June 30, 2021, Zydeco entered into a termination of revolving loan facility agreement with STCW to terminate the 2019 Zydeco Revolver. See Note 8 — Related Party Debt for definitions and additional information regarding these credit facilities.

We provide crude oil transportation, terminaling and storage services to related parties under long-term contracts. We entered into these contracts in the normal course of our business. Our revenue from related parties for 2021, 2020 and 2019 is disclosed in Note 12 — Revenue Recognition.

The following table shows related party expenses, including certain personnel costs, incurred by Shell and SPLC on our behalf that are reflected in the accompanying consolidated statements of income for the indicated periods. Included in these amounts, and disclosed below, is our share of operating and general corporate expenses, as well as the fees paid to SPLC under certain agreements.


	2021		2020		2019
Allocated operating expenses	$	53	$	45	$	18
Major maintenance costs (1)	8		6		—
Insurance expense (2)	20		20		18
Other (3)	43		43		23
Operations and maintenance – related parties	$	124	$	114	$	59

Allocated general corporate expenses	$	25	$	29	$	28
Management Agreement fee	10		9		9
Omnibus Agreement fee	10		11		11
Other	—		—		1
General and administrative – related parties	$	45	$	49	$	49

(2) Prior to November 1, 2021, the majority of our insurance coverage was provided by a wholly owned subsidiary of Shell, with the remaining coverage provided by third-party insurers. After November 1, 2021, a third-party insurer provided and continues to provide the first 5% of our insurance coverage with the remaining coverage provided by an affiliate of Shell as a reinsurer.

Employees who directly or indirectly support our operations participate in the pension, postretirement health and life insurance and defined contribution benefit plans sponsored by Shell, which include other Shell subsidiaries. Our share of pension and postretirement health and life insurance costs for 2021, 2020 and 2019 was $5 million, $5 million and $6 million, respectively. Our share of defined contribution benefit plan costs was $2 million for each of 2021, 2020 and 2019. Pension and defined contribution benefit plan expenses are included in either General and administrative – related parties or Operations and maintenance – related parties in the accompanying consolidated statements of income, depending on the nature of the employee’s role in our operations.

Severance expenses are included in either General and administrative – related parties or Operations and maintenance – related parties, depending on the nature of the employee’s role in our operations. We recorded voluntary and involuntary severance costs of $7 million in 2020. These costs for 2021 and 2019 were not material.

“directional drill project”). As the directional drill project was completed at the end of 2019, the amounts incurred by the project in 2021 and 2020, and associated claims for reimbursement from our Parent, were both not material. In 2019, the amount incurred and claimed for reimbursement was $19 million. These reimbursements are included in Other contributions from Parent in the accompanying consolidated statements of cash flows and consolidated statements of (deficit) equity. For each of these periods, this amount reflects our proportionate share of the directional drill project costs and expenses.

Further, in the fourth quarter of 2019, we received approximately $9 million from SPLC with respect to a Mars storage revenue reimbursement provision contained in the Purchase and Sale Agreement entered into in 2016 that was recognized as an additional capital contribution. See Note 5 — Equity Method Investments for additional details.

Pursuant to the terminaling services agreement entered into among Triton, SOPUS and Shell Chemical related to the Norco Assets acquired in the April 2020 Transaction (see Note 3 — Acquisitions and Other Transactions), the Partnership receives an annual net payment of $140 million, which is the total annual payment pursuant to the terminaling service agreements of $151 million, less $11 million, which primarily represents the allocated utility costs from SOPUS related to the Norco Assets. The annual payments are subject to annual Consumer Price Index adjustments. See Note 12 — Revenue Recognition for additional details.

The transfer of the Norco Assets, combined with the terminaling services agreements, were accounted for as a failed sale leaseback under the lease standard. As a result, the transaction was treated as a financing arrangement in which the underlying assets were not recognized in property, plant and equipment of the Partnership as control of the Norco Assets did not transfer to the Partnership, and instead were recorded as financing receivables from SOPUS and Shell Chemical.

We recognize interest income on the financing receivables on the basis of an imputed interest rate of 11.1% related to SOPUS and 7.4% related to Shell Chemical. The following table shows the cash payments received for interest income and cash principal payments received on the financing receivables for the years ended December 31, 2021 and 2020: