Related Party Transactions
|12 Months Ended|
Dec. 31, 2021
|Related Party Transactions|
|Related Party Transactions||
16.Related Party Transactions
Solaris Energy Management, LLC
On September 14, 2016, we entered into an administrative services arrangement with Solaris Energy Management, LLC (“SEM”), a company owned by William A. Zartler, our Founder and Executive Chairman, for the provision of certain personnel and administrative services at cost. Beginning in 2020, services provided by SEM are administrative only. In addition, SEM provides office space and services for equipment and supplies to us under the administrative services agreement.
For the years ended December 31, 2021, 2020 and 2019, we incurred $0.6 million, $0.5 million, and $1.1 million, respectively, for these services, included in general and administrative expenses.
We had $0.05 million accrued payables to SEM at December 31, 2021 and no outstanding payable balance at December 31, 2020. As of December 31, 2021 and 2020, we had a prepaid balance to SEM of $0.2 million to cover future rent and other expenses.
Solaris Energy Capital, LLC
There are certain de minimis general and administrative expenses that are paid on our behalf by Solaris Energy Capital, LLC, a company owned by William A. Zartler, and are recorded in general and administrative
expenses. We had no outstanding payables to Solaris Energy Capital, LLC. As of December 31, 2021 and 2020.
Blanco Aviation, LLC
We are a party to an aircraft “dry” lease arrangement with Blanco Air Services, LLC, a company owned by William A. Zartler, for the use of certain aircrafts billed at an hourly rate. We incurred expense of $70 thousand, $64 thousand and $228 thousand for the years ended December 31, 2021, 2020, and 2019, respectively, which are recorded in general and administrative expenses. We had no outstanding balance payable to Blanco Aviation, LLC at December 31, 2021 and the balance outstanding at December 31, 2020 was de minimis.
Vision Resources, Inc.
We purchase brackish water for use in our water solutions activities from Vision Resources, Inc (“Vision”). Vision is a Legacy Owner of Solaris LLC. For the years ended December 31, 2021, 2020 and 2019, we made purchases of $1.5 million, $1.7 million and $0.8 million, respectively, for water and services. We also rent office space from an affiliate of Vision in Carlsbad, New Mexico and have incurred rent expense of $0.2 million, $0.2 million and $0.1 million for the years ended December 31, 2021, 2020, and 2019, respectively.
We and ConocoPhillips, one of our principal owners, entered awater gathering and handling agreement, pursuant to which ConocoPhillips agreed to dedicate all the produced water generated from its current and future acreage in a defined area of mutual interest (“AMI”) in New Mexico and Texas. As of December 31, 2021 and 2020, we had a receivable of $20.2 million and $11.5 million, respectively, from ConocoPhillips that was recorded in Accounts Receivable from Affiliate. As of December 31, 2021 and 2020, we had a payable of $1.4 million and $1.9 million, respectively, to ConocoPhillips that was recorded in Payables to Affiliate. The following table shows revenue and expenses from ConocoPhillips:
Operating expenses reimbursed to ConocoPhillips are related to ConocoPhillips’ costs for operating certain assets on our behalf between closing and the transfer of the acquired assets and other ongoing operating expenses.
The entire disclosure for related party transactions. Examples of related party transactions include transactions between (a) a parent company and its subsidiary; (b) subsidiaries of a common parent; (c) and entity and its principal owners; and (d) affiliates.
Reference 1: http://www.xbrl.org/2003/role/disclosureRef