Leases (Tables)

3 Months Ended

Mar. 31, 2019


			Three Months Ended
(Thousands of dollars)	Financial Statement Category		March 31, 2019
Operating lease 1,2	Lease operating expenses	$	58,523
Operating lease 2	Selling and general expense		3,109
Operating lease 2	Property, plant and equipment		23,447
Operating lease 2	Asset retirement obligations		3,024
Finance lease
Amortization of asset	Depreciation, depletion and amortization		210
Interest on lease liabilities	Interest expense, net		101
Sublease income	Other income		(217)
Net lease expense		$	88,197

1 Includes variable lease expenses of $7.2 million primarily related to additional volumes processed at a gas processing plant.

2 Includes $12.0 million for Lease operating expense, $1.1 million for Selling and general expense, $20.1 million for Property, plant and equipment, net and $3.0 million for Asset retirement obligations relating to short-term leases. Expenses primarily relate to drilling rigs and other oil and gas field equipment.

Schedule of Maturity of Lease Liabilities

Maturity of Lease Liabilities


(Thousands of dollars)		Operating Leases 1	Finance Leases	Total
2019	$	164,979	801	165,780
2020		109,790	1,069	110,859
2021		58,415	1,069	59,484
2022		53,639	1,069	54,708
2023		53,140	1,069	54,209
Remaining		465,611	5,610	471,221
Total future minimum lease payments		905,574	10,687	916,261
Less imputed interest		(281,613)	(2,234)	(283,847)
Present value of lease liabilities 2	$	623,961	8,453	632,414

1 Excludes $272.2 million of minimum lease payments for leases entered but not yet commenced. These payments relate to an expansion of an existing gas processing plant and payments are anticipated to commence at the end of 2019 for 20 years.

2 Includes both the current and long-term portion of the lease liabilities.

Summary of Lease Term and Discount Rate


		March 31, 2019
Weighted average remaining lease term:
Operating leases		11 years
Finance leases		10 years
Weighted average discount rate:
Operating leases		5.07%
Finance leases		4.80%

Summary of Other Lease Information


		Three Months Ended
(Thousands of dollars)		March 31, 2019
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	44,730
Operating cash flows from finance leases		102
Financing cash flows from finance leases		160
Right-of-use assets obtained in exchange for lease liabilities:
Operating leases	$	311