We are the subject of, or party to, a number of pending or threatened legal actions and administrative proceedings or investigations arising in the ordinary course of our business including, but not limited to, royalty claims, contract claims and environmental claims. While many of these matters involve inherent uncertainty, we believe that the amount of the liability, if any, ultimately incurred with respect to proceedings or claims will not have a material adverse effect on our consolidated financial position as a whole or on our liquidity, capital resources or future annual results of operations.

When deemed necessary, we establish reserves for certain legal proceedings. The establishment of a reserve is based on an estimation process that includes the advice of legal counsel and subjective judgment of management. While management believes these reserves to be adequate, it is reasonably possible we could incur additional losses with respect to those matters in which reserves have been established. We will continue to evaluate our litigation on a quarterly basis and will establish and adjust any litigation reserves as appropriate to reflect our assessment of the then current status of litigation.

We have incurred and will continue to incur capital, operating and remediation expenditures as a result of environmental laws and regulations. As of December 31, 2021 and 2020, liabilities for remediation were not material. We are not aware of any environmental claims existing as of December 31, 2021 that have not been provided for or would otherwise have a material impact on our financial position or results of operations. Environmental liabilities normally involve estimates that are subject to revision until final resolution, settlement or remediation occurs.

On March 4, 2021 a putative class action lawsuit was filed in the Western District of Pennsylvania in Case No. 2:21-CV-301 (Jacobowitz v. Range Resources Corporation et al.) in which the Plaintiff seeks to represent a class of Range stockholders who purchased or acquired stock from April 29, 2016 to February 10, 2021. This lawsuit was transferred to the U.S. District Court for the Northern District of Texas (Fort Worth Division). The lawsuit claims that Range misclassified certain wells as inactive rather than having plugged the wells and that such alleged misclassification affected the determination of our asset retirement obligation accrual. The lawsuit claims that the disclosure of a $294,000 agreed penalty that we paid to the Pennsylvania Department of Environmental Protection (DEP) in connection with the DEP’s investigation of our application for inactive status for a small number of our wells, which the DEP disclosed during market hours on February 10, 2021 was the basis for the Plaintiffs’ discovery of the alleged misrepresentations. We maintain that the factual allegations and the claims made in the litigation are baseless; there were no misrepresentations made and our asset retirement obligation was properly calculated. We also maintain that the market fully absorbed the information disclosed by the DEP on February 10, 2021 and the stock price on that day did not decrease. Given our view of the litigation as baseless, we are vigorously defending the litigation and moved for its dismissal. Additionally, on January 20, 2022, a derivative action styled as Lewis v. Ventura et al. was filed under seal in the Northern District of Texas (Case No. 4-22CV-051-0) asserting similar allegations as the previously described Jacobowitz matter. We maintain the same views as to the merits of the Lewis matter as the Jacobowitz matter as more fully detailed above and we plan to vigorously defend the matter.

Certain contractual obligations were retained by us after our divestiture of our North Louisiana assets. These obligations are primarily related to gathering, processing and transportation agreements including certain minimum volume commitments. For additional information see Note 3, Note 10 and Note 15.

The components of our total lease expense for the two years ended December 31, 2021, the majority of which is included in general and administrative expense, are as follows (in thousands):


	Year Ended December 31,
	2021			2020
Operating lease cost	$	26,343		$	27,895
Variable lease expense (1)		27,243			33,849
Short-term lease expense (2)		1,950			1,866
Sublease income		(2,380	)		(3,199	)
Total lease expense	$	53,156		$	60,411

Short-term lease costs (3)	$	18,984		$	15,984


(1)	Variable lease payments that are not dependent on an index or rate and are not included in the lease liability or ROU assets.
(2)	Short-term lease expense represents expense related to leases with a contract term of one year or less and are not included in our ROU assets or lease liability in our consolidated balance sheet.
(3)	These short-term lease costs are related to leases with a contract term of one year or less, the majority of which are related to drilling rigs which are capitalized as part of natural gas and oil properties on our consolidated balance sheets and may fluctuate based on the number of drilling rigs being utilized.

Supplemental cash flow information related to our operating leases is included in the table below (in thousands):


	Year Ended December 31,
	2021		2020
Cash paid for amounts included in the measurement of lease liabilities	$	28,118	$	32,030
ROU assets added in exchange for lease obligations	$	1,059	$	27,769

Supplemental balance sheet information related to our operating leases is included in the table below (in thousands):


	Year Ended December 31,
	2021			2020
Operating lease ROU assets	$	40,832		$	63,581
Accrued liabilities – current	$	(19,066	)	$	(24,673	)
Operating lease liabilities – long-term	$	(24,861	)	$	(43,155	)

Our weighted average remaining lease term and weighted average discount rate for our operating leases are as follows:


	Year Ended December 31,
	2021	2020
Weighted average remaining lease term	3.8 years	4.0 years
Weighted average discount rate	6%	6%

Our lease liabilities with enforceable contract terms that are greater than one year mature as follows (in thousands):


	Operating Leases
2022	$	21,281
2023		7,207
2024		6,546
2025		6,468
2026		6,168
Thereafter		2,627
Total lease payments		50,297
Less effects of discounting		(6,370	)
Total lease liability	$	43,927

We recorded impairment expense on certain office leases of $2.0 million in the year ended December 31, 2020 and $2.1 million in the year ended December 31, 2019.

We have entered into firm transportation and gathering contracts with various pipeline carriers for the future transportation and gathering of natural gas, NGLs and oil production from our properties in Pennsylvania. Under these contracts, we are obligated to transport, process or gather minimum daily natural gas volumes, or pay for any deficiencies at a specified reservation fee rate. Our production committed to these pipelines is currently expected to exceed the minimum daily volumes provided in the contracts. However, if in the future we fail to deliver the committed volumes, we would recognize a deficiency payment in the period in which the under-delivery takes place and the related liability has been incurred. As of December 31, 2021, future minimum transportation, processing and gathering fees under our commitments are as follows (in thousands):


	Transportation, Gathering and Processing Contracts (a)
2022	$	801,974
2023		784,712
2024		768,059
2025		682,050
2026		623,561
Thereafter		3,520,105
	$	7,180,461


(a)	The amounts in this table represent the gross amounts that we are committed to pay; however, we will record in our financial statements our proportionate share of costs based on our working interest which can vary based on volumes produced.

In addition to the amounts included in the above table, we have entered into an additional agreement which is contingent on certain pipeline modifications and/or construction for natural gas volumes of 25,000 mcf per day and is expected to begin in 2022 with a six-year term.

Not included in the table above is our estimate of accrued contractual obligations related to certain obligations retained by us after our divestiture of our North Louisiana assets. These contractual obligations are related to gathering, processing and transportation agreements including certain minimum volume commitments. There are inherent uncertainties surrounding the retained obligation and, as a result, the determination of the accrued obligation required significant judgement and estimation. The actual settlement amount and timing may differ from our estimates. See also Note 3 and Note 10. As of December 31, 2021, the carrying value of this obligation was $416.4 million and is included in divestiture contract obligation in our consolidated balance sheet. As of December 31, 2021, our estimated settlement of this retained obligation based on a discounted value is as follows (in thousands):


	Divestiture Contract Obligation
2022	$	91,120
2023		71,277
2024		58,401
2025		51,688
2026		36,971
Thereafter		106,942
	$	416,399

We have various volume delivery commitments that are related to our Marcellus Shale properties. We expect to be able to fulfill our contractual obligations from our own production; however, we may purchase third-party volumes to satisfy our commitments or pay demand fees for commitment shortfalls, should they occur. As of December 31, 2021, our delivery commitments through 2031 were as follows:


Year Ending December 31,	Natural Gas (mmbtu per day)	Ethane and Propane (bbls per day)
2022	588,158	55,000
2023	500,710	39,932
2024	253,566	35,000
2025	182,493	35,000
2026	158,301	35,000
2027	100,000	35,000
2028	100,000	35,000
2029	100,000	20,000
2030	—	20,000
2031	—	20,000

In addition to the amounts included in the above table, we have contracted with a pipeline company through 2037 to deliver ethane production volumes from our Marcellus Shale wells. These agreements and related fees, which are contingent upon facility construction and/or modification, are for 3,000 bbls per day starting in 2022 and increasing to 18,000 bbls per day in 2027 and increasing again to 25,000 bbls per day in 2029 then declining to 10,000 bbls per day in 2034 and declining again to 3,000 bbls per day through the end of the term in 2037.

We have lease acreage that is generally subject to expiration if initial wells are not drilled within a specified period, generally between three and five years. We do not expect to lose significant lease acreage because of failure to drill due to inadequate capital, equipment or personnel. However, based on our evaluation of prospective economics, we have allowed acreage to expire and will allow additional acreage to expire in the future. To date, our expenditures to comply with environmental or safety regulations have not been a significant component of our cost structure and are not expected to be significant in the future. However, new regulations, enforcement policies, claims for damages or other events could result in significant future costs.