LEASES

6 Months Ended

Jun. 30, 2024

Leases [Abstract]

LEASES

LEASES

Finance Leases

The Company's finance lease liabilities consisted of the following as of June 30, 2024 and December 31, 2023 (in thousands):

Creditor	Loan Type	As of June 30, 2024		As of December 31, 2023
Matheson Tri-Gas	Finance Lease	$	43,488	$	44,132
Plaquemines	Finance Lease	886		994
Harvey Ford	Finance Lease	34		39
DLL financial	Finance Lease	41		47
Diego	Finance Lease	126		137
Xerox	Finance Lease	16		—
Centerpoint Blakely	Finance Lease	22,868		23,292
		$	67,459	$	68,641

Future maturities of finance lease obligations, as of June 30, 2024, are summarized as follows (in thousands):

Period Ended June 30,	Amount Due
2025	$	8,449
2026	8,460
2027	8,455
2028	27,385
2029	6,578
Thereafter	54,600
Total lease payments	113,927
Less: interest	(46,468)
Present value of financing lease liabilities	67,459
Less: current portion of lease liabilities	(2,541)
Total lease liabilities, net of current portion	$	64,918

The following table summarizes the lease cost recognized in our consolidated statements of operations (in thousands):

	Three Months Ended June 30,				Six Months Ended June 30,
Lease Cost Type	2024		2023		2024		2023
Amortization of finance lease ROU assets	$	992	$	984	$	1,985	$	1,769
Interest on lease liabilities	1,508		1,551		3,030		2,934
Net finance lease costs	$	2,500	$	2,535	$	5,015	$	4,703

Operating Leases

Operating leases are included in operating lease right-of-use lease assets, and operating current and long-term lease liabilities on the consolidated balance sheets. Lease expense for operating leases is recognized on a straight-line basis over the lease term. Variable lease expense is recognized in the period in which the obligation for those payments is incurred. Lease expense for equipment is included in cost of revenues and other rents are included in selling, general and administrative expense on the unaudited consolidated statements of operations.

The following table summarizes the operating lease costs recognized (in thousands):

	Three Months Ended June 30,				Six Months Ended June 30,
Lease Cost Type	2024		2023		2024		2023
Operating lease cost	$	5,622	$	4,962	$	13,121	$	8,032
Variable lease cost	1,871		609		2,530		869
Short-term lease cost	5,393		181		12,044		2,110
Net lease cost	$	12,886	$	5,752	$	27,695	$	11,011

Cash Flows

The following table summarizes the supplemental cash flow information related to leases as follows (in thousands):

	Six Months Ended June 30,
Lease Cost Type	2024		2023
Cash paid for amounts included in the measurement of liabilities
Payments on financing lease	$	1,187	$	908
Payments on operating lease	$	13,121	$	8,032
Non-cash supplemental amounts
ROU assets obtained from new finance lease liabilities	$	16	$	23,990
ROU assets obtained from new operating lease liabilities	$	1,084	$	38,945
ROU assets terminated from release of operating lease liabilities	$	(9,747)	$	—

Maturities of our lease liabilities for all operating leases are as follows as of June 30, 2024 (in thousands):

Period Ended June 30,	Facilities		Equipment		Plant		Railcar		Total
2025	$	978	$	11,296	$	7,717	$	904	$	20,895
2026	735		5,638		7,731		831		14,935
2027	619		5,058		7,770		593		14,040
2028	608		2,164		7,399		339		10,510
2029	506		—		6,951		295		7,752
Thereafter	1,180		—		70,462		49		71,691
Total lease payments	4,626		24,156		108,030		3,011		139,823
Less: interest	(1,296)		(3,597)		(59,034)		(670)		(64,597)
Present value of operating lease liabilities	3,330		20,559		48,996		2,341		75,226
Less: current portion of lease liabilities	(642)		(9,375)		(1,826)		(681)		(12,524)
Total lease liabilities, net of current portion	$	2,688	$	11,184	$	47,170	$	1,660	$	62,702

The weighted average remaining lease terms and discount rates for all of our financing lease and operating leases were as follows as of June 30, 2024:

Remaining lease term and discount rate:	June 30, 2024
	Operating lease		Financing lease
Weighted average remaining lease terms (years)
Lease facilities	4.67		—
Lease equipment	1.68		3.70
Lease plant	13.29		13.91
Lease railcar	3.63		—
Weighted average discount rate
Lease facilities	11.06	%	—	%
Lease equipment	12.09	%	9.17	%
Lease plant	12.32	%	8.90	%
Lease railcar	13.49	%	—	%

Significant Judgments

Significant judgments include the discount rates applied, the expected lease terms, lease renewal options and residual value guarantees. There are several leases with renewal options or purchase options.

The purchase options are not expected to have a material impact on the lease obligation. There are several facility and plant leases which have lease renewal options ranging from one to five years for each renewal period. The Company will reassess the lease terms and purchase options when there is a significant change in circumstances or when the Company elects to exercise an option that had previously been determined that it was not reasonably certain to do so.

LEASES

LEASES

Finance Leases

The Company's finance lease liabilities consisted of the following as of June 30, 2024 and December 31, 2023 (in thousands):

Creditor	Loan Type	As of June 30, 2024		As of December 31, 2023
Matheson Tri-Gas	Finance Lease	$	43,488	$	44,132
Plaquemines	Finance Lease	886		994
Harvey Ford	Finance Lease	34		39
DLL financial	Finance Lease	41		47
Diego	Finance Lease	126		137
Xerox	Finance Lease	16		—
Centerpoint Blakely	Finance Lease	22,868		23,292
		$	67,459	$	68,641

Future maturities of finance lease obligations, as of June 30, 2024, are summarized as follows (in thousands):

Period Ended June 30,	Amount Due
2025	$	8,449
2026	8,460
2027	8,455
2028	27,385
2029	6,578
Thereafter	54,600
Total lease payments	113,927
Less: interest	(46,468)
Present value of financing lease liabilities	67,459
Less: current portion of lease liabilities	(2,541)
Total lease liabilities, net of current portion	$	64,918

The following table summarizes the lease cost recognized in our consolidated statements of operations (in thousands):

	Three Months Ended June 30,				Six Months Ended June 30,
Lease Cost Type	2024		2023		2024		2023
Amortization of finance lease ROU assets	$	992	$	984	$	1,985	$	1,769
Interest on lease liabilities	1,508		1,551		3,030		2,934
Net finance lease costs	$	2,500	$	2,535	$	5,015	$	4,703

Operating Leases

Operating leases are included in operating lease right-of-use lease assets, and operating current and long-term lease liabilities on the consolidated balance sheets. Lease expense for operating leases is recognized on a straight-line basis over the lease term. Variable lease expense is recognized in the period in which the obligation for those payments is incurred. Lease expense for equipment is included in cost of revenues and other rents are included in selling, general and administrative expense on the unaudited consolidated statements of operations.

The following table summarizes the operating lease costs recognized (in thousands):

	Three Months Ended June 30,				Six Months Ended June 30,
Lease Cost Type	2024		2023		2024		2023
Operating lease cost	$	5,622	$	4,962	$	13,121	$	8,032
Variable lease cost	1,871		609		2,530		869
Short-term lease cost	5,393		181		12,044		2,110
Net lease cost	$	12,886	$	5,752	$	27,695	$	11,011

Cash Flows

The following table summarizes the supplemental cash flow information related to leases as follows (in thousands):

	Six Months Ended June 30,
Lease Cost Type	2024		2023
Cash paid for amounts included in the measurement of liabilities
Payments on financing lease	$	1,187	$	908
Payments on operating lease	$	13,121	$	8,032
Non-cash supplemental amounts
ROU assets obtained from new finance lease liabilities	$	16	$	23,990
ROU assets obtained from new operating lease liabilities	$	1,084	$	38,945
ROU assets terminated from release of operating lease liabilities	$	(9,747)	$	—

Maturities of our lease liabilities for all operating leases are as follows as of June 30, 2024 (in thousands):

Period Ended June 30,	Facilities		Equipment		Plant		Railcar		Total
2025	$	978	$	11,296	$	7,717	$	904	$	20,895
2026	735		5,638		7,731		831		14,935
2027	619		5,058		7,770		593		14,040
2028	608		2,164		7,399		339		10,510
2029	506		—		6,951		295		7,752
Thereafter	1,180		—		70,462		49		71,691
Total lease payments	4,626		24,156		108,030		3,011		139,823
Less: interest	(1,296)		(3,597)		(59,034)		(670)		(64,597)
Present value of operating lease liabilities	3,330		20,559		48,996		2,341		75,226
Less: current portion of lease liabilities	(642)		(9,375)		(1,826)		(681)		(12,524)
Total lease liabilities, net of current portion	$	2,688	$	11,184	$	47,170	$	1,660	$	62,702

The weighted average remaining lease terms and discount rates for all of our financing lease and operating leases were as follows as of June 30, 2024:

Remaining lease term and discount rate:	June 30, 2024
	Operating lease		Financing lease
Weighted average remaining lease terms (years)
Lease facilities	4.67		—
Lease equipment	1.68		3.70
Lease plant	13.29		13.91
Lease railcar	3.63		—
Weighted average discount rate
Lease facilities	11.06	%	—	%
Lease equipment	12.09	%	9.17	%
Lease plant	12.32	%	8.90	%
Lease railcar	13.49	%	—	%

Significant Judgments

Significant judgments include the discount rates applied, the expected lease terms, lease renewal options and residual value guarantees. There are several leases with renewal options or purchase options.

The purchase options are not expected to have a material impact on the lease obligation. There are several facility and plant leases which have lease renewal options ranging from one to five years for each renewal period. The Company will reassess the lease terms and purchase options when there is a significant change in circumstances or when the Company elects to exercise an option that had previously been determined that it was not reasonably certain to do so.