Commitments and Contingencies
|9 Months Ended|
Sep. 30, 2021
|Solaris Midstream Holdings, LLC and Subsidiaries|
|Commitments and Contingencies|
|Commitments and Contingencies||
11.Commitments and Contingencies
In the normal course of business, we are subjected to various claims, legal actions, contract negotiations and disputes. We provide for losses, if any, in the period in which they become probable and can be reasonably estimated. In management’s opinion, there are currently no such matters outstanding that would have a material effect on the accompanying financial statements.
Additionally, the Company is party to a guarantee related to a lease agreement with Solaris Energy Management, LLC (“SEM”), a related party of the Company, for the rental of office space at the Company’s corporate headquarters. As of September 30, 2021, the Company’s share of SEM’s future commitment related to this lease agreement is $3.1 million. See Note 12—Related Party Transactions.
In the normal course of business, we enter short-term purchase obligations for products and services, primarily related to purchases of long-lead materials. As of September 30, 2021, we have purchase obligations and commitments of approximately $7.4 million due in the next twelve months.
We are party to a surface use and compensation agreement by which the Company has agreed to a minimum annual payment for each of the first ten years beginning in 2020, in exchange for certain rights to access and use the land for the limited purposes of conducting water operations for a period of thirteen years. As of September 30, 2021, there are no minimum annual payments due until 2022.
The table below provides estimates of the timing of future payments that the Company is contractually obligated to make based on agreements in place as of September 30, 2021:
The entire disclosure for commitments and contingencies.
Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.
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