Contango Oil & Gas (MCF) 10-Q 19 Aug 20 2020 Q2 Quarterly report Financial data

Document And Entity Information

Document And Entity Information - shares	6 Months Ended
	Jun. 30, 2020	Aug. 14, 2020
Document And Entity Information
Document Type	10-Q
Document Period End Date	Jun. 30, 2020
Entity Registrant Name	CONTANGO OIL & GAS CO
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		133,038,930
Entity Central Index Key	0001071993
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2020
Document Fiscal Period Focus	Q2
Amendment Flag	false

CONSOLIDATED BALANCE SHEETS

CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Jun. 30, 2020	Dec. 31, 2019
CURRENT ASSETS:
Cash and cash equivalents	$ 404	$ 1,624
Accounts receivable, net	25,672	39,567
Prepaid expenses	1,363	1,191
Current derivative asset	16,826	3,819
Inventory	1,710	186
Total current assets	45,975	46,387
Oil and natural gas and properties, successful efforts method of accounting:
Proved properties	1,315,040	1,306,916
Unproved properties	20,901	27,619
Other property and equipment	1,668	1,655
Accumulated depreciation, depletion and amortization	(1,206,957)	(1,045,070)
Total property, plant and equipment, net	130,652	291,120
OTHER NON-CURRENT ASSETS:
Investments in affiliates	6,879	6,766
Long-term derivative asset	4,395	357
Right-of-use lease assets	5,691	5,885
Debt issuances costs	1,939	3,311
Total other non-current assets	18,904	16,319
TOTAL ASSETS	195,531	353,826
CURRENT LIABILITIES:
Accounts payable and accrued liabilities	77,143	104,593
Current derivative liability	908	3,951
Current asset retirement obligations	2,291	2,003
Total current liabilities	80,342	110,547
NON-CURRENT LIABILITIES:
Long-term debt	82,537	72,768
Long-term derivative liability	917	2,020
Asset retirement obligations	45,581	49,662
Lease liabilities	2,156	2,789
Deferred tax liability	376
Total non-current liabilities	131,567	127,239
TOTAL LIABILITIES	211,909	237,786
COMMITMENTS AND CONTINGENCIES (NOTE 12)
SHAREHOLDERS’ EQUITY (DEFICIT):
Series C contingent convertible preferred stock, $0.04 par value, no shares authorized, issued and outstanding at June 30, 2020 and 2,700,000 shares authorized, issued and outstanding at December 31, 2019		108
Common stock, $0.04 par value, 400 million shares authorized, 132,067,369 shares issued and 131,996,757 shares outstanding at June 30, 2020, 128,985,146 shares issued and 128,977,816 shares outstanding at December 31, 2019	5,271	5,148
Additional paid-in capital	472,814	471,778
Treasury shares at cost (70,612 shares at June 30, 2020 and 7,330 shares at December 31, 2019)	(198)	(18)
Accumulated deficit	(494,265)	(360,976)
Total shareholders’ equity (deficit)	(16,378)	116,040
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY (DEFICIT)	$ 195,531	$ 353,826

CONSOLIDATED BALANCE SHEETS (Pa

CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares	Jun. 30, 2020	Dec. 31, 2019
CONSOLIDATED BALANCE SHEETS
Preferred stock, par value (in dollars per share)	$ 0.04	$ 0.04
Preferred stock, shares authorized	0	2,700,000
Preferred stock, shares issued		2,700,000
Preferred stock, shares outstanding		2,700,000
Common stock, par value (in dollars per share)	$ 0.04	$ 0.04
Common stock, shares authorized	400,000,000	400,000,000
Common stock, shares issued	132,067,369	128,985,146
Common stock, shares outstanding	131,996,757	128,977,816
Treasury stock, shares	70,612	7,330

CONSOLIDATED STATEMENTS OF OPER

CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
REVENUES:
Revenues	$ 17,842	$ 12,762	$ 52,416	$ 26,773
EXPENSES:
Operating expenses	17,139	5,694	38,621	10,886
Exploration expenses	11,173	249	11,571	473
Depreciation, depletion and amortization	5,092	7,573	17,946	15,129
Impairment and abandonment of oil and gas properties		1,247	145,878	1,834
General and administrative expenses	5,713	4,456	11,138	9,461
Total expenses	39,117	19,219	225,154	37,783
OTHER INCOME (EXPENSE):
Gain (loss) from investment in affiliates, net of income taxes	(173)	427	113	457
Gain from sale of assets	4,406	421	4,433	409
Interest expense	(2,151)	(1,079)	(3,365)	(2,171)
Gain (loss) on derivatives, net	(8,804)	2,065	37,895	(813)
Other income	332	89	1,136	3
Total other income (expense)	(6,390)	1,923	40,212	(2,115)
NET LOSS BEFORE INCOME TAXES	(27,665)	(4,534)	(132,526)	(13,125)
Income tax provision	(369)	(427)	(763)	(454)
NET LOSS	$ (28,034)	$ (4,961)	$ (133,289)	$ (13,579)
NET LOSS PER SHARE:
Basic (in dollars per share)	$ (0.21)	$ (0.15)	$ (1.01)	$ (0.40)
Diluted (in dollars per share)	$ (0.21)	$ (0.15)	$ (1.01)	$ (0.40)
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING:
Basic (in shares)	131,449	33,909	131,394	33,840
Diluted (in shares)	131,449	33,909	131,394	33,840
Oil and Condensate [Member]
REVENUES:
Revenues	$ 7,930	$ 7,439	$ 30,712	$ 13,845
Natural Gas, Production [Member]
REVENUES:
Revenues	6,618	3,857	14,789	9,499
Natural gas liquids [Member]
REVENUES:
Revenues	$ 3,294	$ 1,466	$ 6,915	$ 3,429

CONSOLIDATED STATEMENTS OF CASH

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$ (133,289)	$ (13,579)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation, depletion and amortization	17,946	15,129
Impairment of oil and natural gas properties	145,878	1,079
Exploration expenditures - dry hole costs	10,878
Amortization of debt issuance costs	1,372
Deferred income taxes		424
Gain on sale of assets	(4,433)	(409)
Gain from investment in affiliates	(113)	(457)
Stock-based compensation	616	1,637
Unrealized loss (gain) on derivative instruments	(21,192)	2,078
Changes in operating assets and liabilities:
Decrease in accounts receivable & other receivables	13,614	1,530
Decrease (increase) in prepaids	(172)	298
Increase in inventory	(1,560)
Increase (decrease) in accounts payable & advances from joint owners	(17,132)	8,592
Decrease in other accrued liabilities	(4,636)	(350)
Decrease (increase) in income taxes receivable, net	281	(424)
Increase (decrease) in income taxes payable, net	119	(258)
Increase (decrease) in deposits and other	36	(392)
Net cash used in operating activities	8,213	14,898
CASH FLOWS FROM INVESTING ACTIVITIES:
Oil and natural gas exploration and development expenditures	(19,719)	(14,604)
Additions to furniture & equipment	(77)	(17)
Sale of oil and gas properties	339
Net cash used in investing activities	(19,457)	(14,621)
CASH FLOWS FROM FINANCING ACTIVITIES:
Borrowings under credit facility	55,000	73,548
Repayments under credit facility	(48,600)	(73,548)
PPP loan	3,369
Net proceeds from equity offering	435
Net costs from equity offering		(41)
Purchase of treasury stock	(180)	(236)
Net cash provided by (used in) financing activities	10,024	(277)
NET CHANGE IN CASH AND CASH EQUIVALENTS	(1,220)	0
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD	1,624	0
CASH AND CASH EQUIVALENTS, END OF PERIOD	$ 404	$ 0

CONSOLIDATED STATEMENT OF SHARE

CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY (DEFICIT) - USD ($) $ in Thousands	Preferred Stock [Member]	Common Stock [Member]	Additional Paid-In Capital [Member]	Treasury Stock [Member]	Accumulated Deficit [Member]	Total
Balance at Dec. 31, 2018		$ 1,573	$ 339,981	$ (129,030)	$ (72,135)	$ 140,389
Balance, shares at Dec. 31, 2018		34,158,492
Equity offering costs			(86)			(86)
Treasury shares at cost				(186)		(186)
Treasury shares at cost, shares		(49,415)
Restricted shares activity		$ 12	(12)
Restricted shares activity, shares		307,650
Stock-based compensation			1,052			1,052
Net loss					(8,618)	(8,618)
Balance at Mar. 31, 2019		$ 1,585	340,935	(129,216)	(80,753)	132,551
Balance, shares at Mar. 31, 2019		34,416,727
Balance at Dec. 31, 2018		$ 1,573	339,981	(129,030)	(72,135)	140,389
Balance, shares at Dec. 31, 2018		34,158,492
Net loss						(13,579)
Balance at Jun. 30, 2019		$ 1,587	341,563	(129,266)	(85,714)	128,170
Balance, shares at Jun. 30, 2019		34,442,843
Balance at Mar. 31, 2019		$ 1,585	340,935	(129,216)	(80,753)	132,551
Balance, shares at Mar. 31, 2019		34,416,727
Equity offering-common stock			45			45
Treasury shares at cost				(50)		(50)
Treasury shares at cost, shares		(16,133)
Restricted shares activity		$ 2	(2)
Restricted shares activity, shares		42,249
Stock-based compensation			585			585
Net loss					(4,961)	(4,961)
Balance at Jun. 30, 2019		$ 1,587	341,563	(129,266)	(85,714)	128,170
Balance, shares at Jun. 30, 2019		34,442,843
Balance at Dec. 31, 2019	$ 108	$ 5,148	471,778	(18)	(360,976)	$ 116,040
Balance, shares at Dec. 31, 2019	2,700,000	128,977,816				128,977,816
Equity offering costs			(47)			$ (47)
Treasury shares at cost				(157)		(157)
Treasury shares at cost, shares		(49,474)
Restricted shares activity		$ 3	(3)
Restricted shares activity, shares		77,485
Stock-based compensation			350			350
Net loss					(105,255)	(105,255)
Balance at Mar. 31, 2020	$ 108	$ 5,151	472,078	(175)	(466,231)	10,931
Balance, shares at Mar. 31, 2020	2,700,000	129,005,827
Balance at Dec. 31, 2019	$ 108	$ 5,148	471,778	(18)	(360,976)	$ 116,040
Balance, shares at Dec. 31, 2019	2,700,000	128,977,816				128,977,816
Net loss						$ (133,289)
Balance at Jun. 30, 2020		$ 5,271	472,814	(198)	(494,265)	$ (16,378)
Balance, shares at Jun. 30, 2020		131,996,757				131,996,757
Balance at Mar. 31, 2020	$ 108	$ 5,151	472,078	(175)	(466,231)	$ 10,931
Balance, shares at Mar. 31, 2020	2,700,000	129,005,827
Equity offering-common stock		$ 6	477			483
Equity offering-common stock, shares		155,029
Conversion of preferred stock to common stock	$ (108)	$ 108
Conversion of preferred stock to common stock, shares	(2,700,000)	2,700,000
Treasury shares at cost				(23)		(23)
Treasury shares at cost, shares		(13,808)
Restricted shares activity		$ 6	(6)
Restricted shares activity, shares		149,709
Stock-based compensation			265			265
Net loss					(28,034)	(28,034)
Balance at Jun. 30, 2020		$ 5,271	$ 472,814	$ (198)	$ (494,265)	$ (16,378)
Balance, shares at Jun. 30, 2020		131,996,757				131,996,757

Organization and Business

Organization and Business	6 Months Ended
	Jun. 30, 2020
Organization And Business [Abstract]
Organization and Business	1. Organization and Business Contango Oil & Gas Company (collectively with its subsidiaries, “Contango” or the “Company”) is a Houston, Texas based independent oil and natural gas company, with regional offices in Oklahoma City and Stillwater, Oklahoma. The Company’s business is to maximize production and cash flow from its offshore properties in the shallow waters of the Gulf of Mexico (“GOM”) and onshore Texas, Oklahoma, Louisiana and Wyoming properties and use that cash flow to explore, develop and acquire oil and natural gas properties across the United States. The following table lists the Company’s primary producing areas as of June 30, 2020: Location Formation Gulf of Mexico Offshore Louisiana - water depths less than 300 feet Mid-continent Region of Oklahoma Mississippian, Woodford, Oswego, Cottage Grove, Chester and Red Fork Southern Delaware Basin, Pecos County, Texas Wolfcamp A and B Madison and Grimes counties, Texas Woodbine / Upper Lewisville Zavala and Dimmit counties, Texas Buda / Eagle Ford / Georgetown San Augustine County, Texas Haynesville shale, Mid Bossier shale and James Lime Other Texas Gulf Coast Conventional and smaller unconventional formations Weston County, Wyoming Muddy Sandstone Sublette County, Wyoming Jonah Field (1) (1) Through a 37% equity investment in Exaro Energy III LLC (“Exaro”). Production associated with this equity investment is not included in the Company’s reported production results for all periods shown in this report. From the Company’s initial entry into the Southern Delaware Basin in 2016 and through mid-2019, the Company was focused on the development of its Southern Delaware Basin acreage in Pecos County, Texas . In January 2020, the Company brought one West Texas well online but suspended further drilling in the area in response to the dramatic decline in oil prices during the quarter. As of June 30, 2020, the Company was producing from eighteen wells over its approximate 16,200 gross operated (7,500 company net) acre position in West Texas, prospective for the Wolfcamp A, Wolfcamp B and Second Bone Spring formations. During the fourth quarter of 2019, the Company closed on the acquisitions of certain producing assets and undeveloped acreage of Will Energy Corporation (“Will Energy”) and White Star Petroleum, LLC and certain of its affiliates (collectively, “White Star”), and established an additional core strategic area, located primarily in the Central Oklahoma and Western Anadarko basins. These acquisitions were transformative, as production from these acquisitions represented approximately 70% of the Company’s total net production for the three and six months ended June 30, 2020. Impact of the COVID-19 Pandemic A novel strain of the coronavirus (“COVID-19”) surfaced in late 2019 and has spread, and continues to spread, around the world, including to the United States. In March 2020, the World Health Organization declared COVID-19 a pandemic, and the President of the United States declared the COVID-19 outbreak a national emergency. The COVID-19 pandemic has significantly affected the global economy, disrupted global supply chains and created significant volatility in the financial markets. In addition, the COVID-19 pandemic has resulted in travel restrictions, business closures and other restrictions that have disrupted the demand for oil throughout the world and, when combined with the oil supply increase attributable to the battle for market share among the Organization of Petroleum Exporting Countries (“OPEC”), Russia and other oil producing nations, resulted in oil prices declining significantly beginning in late February 2020. While there has been a modest recovery in oil prices, the length of this demand disruption is unknown, and there is significant uncertainty regarding the long-term impact to global oil demand, which has negatively impacted the Company’s results of operations and planned 2020 capital activities. Due to the extreme volatility in oil prices, the Company has suspended any further plans for onshore drilling in 2020. Management Services Agreement On June 5, 2020, the Company announced the addition of a new corporate strategy that includes offering a property management service (or a “fee for service”) for oil and gas companies with distressed or stranded assets, or companies with a desire to reduce administrative costs. As part of this service offering, the Company entered into a Management Services Agreement with Mid-Con Energy Partners, LP (“Mid-Con”) (Nasdaq: MCEP), effective July 1, 2020, to provide operational services as operator of record on Mid-Con’s oil and gas properties in exchange for an annual services fee of $4 million, paid ratably over the twelve month period, plus reimbursement of certain costs and expenses, a deferred fee of $166,666 per month for each month that the agreement is in effect (not to exceed $2 million), to be paid in a lump sum upon termination of the agreement, and warrants to purchase a minority equity ownership in Mid-Con (with amount and terms of the warrants to be disclosed upon execution of the Warrant Agreement). Both the Company and Mid-Con and their employees have indemnification rights in this fee for service arrangement. As of June 4, 2020, John C. Goff, Chairman of the Board of Directors of the Company, beneficially owned approximately 56% of the common units in Mid-Con, and Travis Goff, John C. Goff’s son and the President of Goff Capital, Inc., serves on the board of directors of the general partner of Mid-Con. Authorized Shares of Common Stock and Conversion of Series C Contingent Convertible Preferred Stock On June 10, 2020, the Company filed an amendment (the “Charter Amendment”) to its Amended and Restated Certificate of Formation with the Secretary of State of the State of Texas to increase the number of authorized shares of common stock, par value of $0.04 per share (the “common stock”), of the Company from 200,000,000 shares to 400,000,000 shares. The Charter Amendment and the conversion of 2,700,000 shares of the Company’s Series C contingent convertible preferred stock, par value $0.04 per share (the “Series C contingent convertible preferred stock”), into 2,700,000 shares of the Company’s common stock were approved by the stockholders of the Company on June 8, 2020, at the Company’s 2020 Annual Meeting of Stockholders. The shares of Series C contingent convertible preferred stock were issued in a private placement completed concurrently with a private placement of common stock in December of 2019. Purchasers of the Series C contingent convertible preferred stock included John Goff, Wilkie Colyer and Farley Dakan, the Company’s current president. Open Market Sale Agreement On June 24, 2020, the Company entered into an Open Market Sale Agreement (the “Sale Agreement”) among the Company and Jefferies LLC (the “Sales Agent”). Pursuant to the terms of the Sale Agreement, the Company may sell from time to time through the Sales Agent, shares of the Company’s common stock, having an aggregate public offering price of up to $100,000,000 (the “Shares”). The Company intends to use the net proceeds from the offering, after deducting the Sales Agent’s commission and the Company’s offering expenses, to repay borrowings under its Credit Agreement (as defined below) and for general corporate purposes, including, but not limited to, acquisitions and exploratory drilling. Under the Sale Agreement, the Company sold 155,029 Shares during the three months ended June 30, 2020 for net proceeds of $0.5 million.

Summary of Significant Accounti

Summary of Significant Accounting Policies	6 Months Ended
	Jun. 30, 2020
Summary Of Significant Accounting Policies [Abstract]
Summary of Significant Accounting Policies	2. Summary of Significant Accounting Policies The accounting policies followed by the Company are set forth in the notes to the Company’s audited consolidated financial statements included in its Annual Report on Form 10-K for the year ended December 31, 2019 (“2019 Form 10-K”) filed with the Securities and Exchange Commission (“SEC”). Please refer to the notes to the financial statements included in the 2019 Form 10-K for additional details of the Company’s financial condition, results of operations and cash flows. No material items included in those notes have changed except as a result of normal transactions in the interim or as disclosed within this interim report. Basis of Presentation The accompanying unaudited consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information, pursuant to the rules and regulations of the SEC, including instructions to Quarterly Reports on Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all the information and footnotes required by GAAP for complete annual financial statements. In the opinion of management, all adjustments considered necessary for a fair statement of the unaudited consolidated financial statements have been included. All such adjustments are of a normal recurring nature. The consolidated financial statements should be read in conjunction with the 2019 Form 10-K. These unaudited interim consolidated results of operations for the six months ended June 30, 2020 are not necessarily indicative of the results that may be expected for the full year ending December 31, 2020. The Company’s consolidated financial statements include the accounts of Contango Oil & Gas Company and its subsidiaries after elimination of all material intercompany balances and transactions. All wholly owned subsidiaries are consolidated. The Company’s investment in Exaro, through its wholly owned subsidiary, Contaro Company, is accounted for using the equity method of accounting, and therefore, the Company does not include its share of individual operating results, production or reserves in those reported for the Company’s consolidated results of operations. Oil and Gas Properties - Successful Efforts The Company’s application of the successful efforts method of accounting for its oil and natural gas exploration and production activities requires judgment as to whether particular wells are developmental or exploratory, since exploratory costs and the costs related to exploratory wells that are determined to not have proved reserves must be expensed, whereas developmental costs are capitalized. The results from a drilling operation can take considerable time to analyze, and the determination that commercial reserves have been discovered requires both judgment and application of industry experience. Wells may be completed that are assumed to be productive and actually deliver oil and natural gas in quantities insufficient to be economic, which may result in the abandonment of the wells at a later date. On occasion, wells are drilled which have targeted geologic structures that are both developmental and exploratory in nature, and in such instances an allocation of costs is required to properly account for the results. Delineation seismic costs incurred to select development locations within a productive oil or natural gas field are typically treated as development costs and capitalized, but often these seismic programs extend beyond the proved reserve areas, and therefore, management must estimate the portion of seismic costs to expense as exploratory. During the quarter ended June 30, 2020, the Company drilled an unsuccessful exploratory well in the Gulf of Mexico, resulting in a charge of $10.9 million for drilling and prospect costs included in “Exploration expenses” in the Company’s consolidated statements of operations. The evaluation of oil and natural gas leasehold acquisition costs included in unproved properties requires management’s judgment of exploratory costs related to drilling activity in a given area. Drilling activities in an area by other companies may also effectively condemn leasehold positions. Impairment of Long-Lived Assets Pursuant to GAAP, when circumstances indicate that proved properties may be impaired, the Company compares expected undiscounted future cash flows on a region basis to the unamortized capitalized cost of the asset. If the estimated future undiscounted cash flows based on the Company’s estimate of future reserves, oil and natural gas prices, operating costs and production levels from oil and natural gas reserves, are lower than the unamortized capitalized cost, then the capitalized cost is reduced to fair value. The factors used to determine fair value include, but are not limited to, estimates of proved, probable and possible reserves, future commodity prices, the timing of future production and capital expenditures and a discount rate commensurate with the risk reflective of the lives remaining for the respective oil and gas properties. Additionally, the Company may use appropriate market data to determine fair value. In the first quarter of 2020, the COVID-19 pandemic and the resulting deterioration in the global demand for oil, combined with the failure by OPEC and Russia to reach an agreement on lower production quotas until April 2020, caused a dramatic increase in the supply of oil, a corresponding decrease in commodity prices, and reduced the demand for all commodity products. Consequently, during the three months ended March 31, 2020, the Company recorded a $143.3 million non-cash charge for proved property impairment of its onshore properties related to the dramatic decline in commodity prices, as discussed above, the “PV-10” (present value, discounted at a 10% rate) of its proved reserves, and the associated change in its current development plans for its proved, undeveloped locations. The Company conducted an impairment test for the three months ended June 30, 2020, but no additional impairment was recorded. During the six months ended June 30, 2019, the company recognized $0.2 million in non-cash proved property impairment related to leases in Wyoming and an onshore non-operated property in an area previously impaired due to revised reserve estimates made during the quarter ended December 31, 2018. Unproved properties are reviewed quarterly to determine if there has been impairment of the carrying value of those properties, with any such impairment charged to expense in the period. The Company recorded a $2.6 million non-cash charge for unproved impairment expense during the six months ended June 30, 2020, all of which was recorded during the first quarter of 2020. The impairment primarily related to acquired leases in the Company’s Central Oklahoma and Western Anadarko regions which will be expiring in 2020, and which the Company has no current plans to develop as a result of the current commodity price environment. The Company recognized non-cash impairment expense of approximately $0.4 million and approximately $0.9 million for three and six months ended June 30, 2019, respectively, related to impairment of certain unproved properties primarily due to expiring leases. Net Loss Per Common Share Basic net loss per common share is computed by dividing the net loss attributable to common stock by the weighted average number of common shares outstanding for the period. Diluted net loss per common share reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock. Potentially dilutive securities, including unexercised stock options, performance stock units and unvested restricted stock, have not been considered when their effect would be antidilutive. The Company excluded 506,325 shares or units, and 414,383 shares or units of potentially dilutive securities during the three and six months ended June 30, 2020, respectively, as they were antidilutive. For the three and six months ended June 30, 2019, the company excluded 648,170 shares or units and 561,164 shares or units, respectively, of potentially dilutive securities, as they were antidilutive. Subsidiary Guarantees Contango Oil & Gas Company, as the parent company of certain subsidiaries (the “Parent Company”), has filed a registration statement on Form S-3 with the SEC to register, among other securities, debt securities that the Parent Company may issue from time to time. Any such debt securities would likely be guaranteed on a joint and several and full and unconditional basis by each of the Parent Company’s current subsidiaries and any future subsidiaries specified in any future prospectus supplement (each a “Subsidiary Guarantor”). Each of the current Subsidiary Guarantors is wholly owned by the Parent Company, either directly or indirectly. The Parent Company has no assets or operations independent of the Subsidiary Guarantors, and there are no significant restrictions upon the ability of the Subsidiary Guarantors to distribute funds to the Parent Company. The Parent Company’s wholly owned subsidiaries do not have restricted assets that exceed 25% of net assets as of the most recent fiscal year end that may not be transferred to the Parent Company in the form of loans, advances or cash dividends by such subsidiary without the consent of a third party. Revenue Recognition Sales of oil, condensate, natural gas and natural gas liquids (“NGLs”) are recognized at the time control of the products are transferred to the customer. Generally, the Company’s gas processing and purchase agreements indicate that the processors take control of the Company’s gas at the inlet of the plant and that control of residue gas is returned to the Company at the outlet of the plant. The midstream processing entity gathers and processes the natural gas and remits proceeds to the Company for the resulting sales of NGLs. The Company delivers oil and condensate to the purchaser at a contractually agreed-upon delivery point at which the purchaser takes custody, title and risk of loss of the product. Generally, the Company’s contracts have an initial term of one year or longer but continue month to month unless written notification of termination in a specified time period is provided by either party to the contract. The Company receives purchaser statements from the majority of its customers, but there are a few contracts where the Company prepares the invoice. Payment is unconditional upon receipt of the statement or invoice. The Company records revenue in the month production is delivered to the purchaser. Settlement statements may not be received for 30 to 90 days after the date production is delivered, and therefore the Company is required to estimate the amount of production delivered to the purchaser and the price that will be received for the sale of the product. Differences between the Company’s estimates and the actual amounts received for product sales are generally recorded in the month that payment is received. Any differences between the Company’s revenue estimates and actual revenue received historically have not been significant. The Company has internal controls in place for its revenue estimation accrual process. The Company will continue to review all new or modified revenue contracts on a quarterly basis for proper treatment. Leases The Company recognizes a lease liability, which is a lessee’s obligation to make lease payments arising from a lease, measured on a discounted basis; and a right-of-use asset, which is an asset that represents the lessee’s right to use, or control the use of, a specified asset for the lease term on the Company’s consolidated balance sheet. The Company does not include leases with an initial term of twelve months or less on the balance sheet. The Company recognizes payments on these leases within “Operating expenses” on its consolidated statement of operations. The Company has modified procedures to its existing internal controls to review any new contracts which contain a physical asset on a quarterly basis and determine if an arrangement is, or contains, a lease at inception. The Company will continue to review all new or modified contracts on a quarterly basis for proper treatment. See Note 7 – “Leases” for additional information. Recent Accounting Pronouncements In June 2016, the FASB issued ASU 2016-13 – Financial Instruments – Credit Losses (“Topic 326”): Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”) related to the calculation of credit losses on financial instruments. All financial instruments not accounted for at fair value will be impacted, including the Company’s trade and joint interest billing receivables. Allowances are to be measured using a current expected credit loss model as of the reporting date that is based on historical experience, current conditions and reasonable and supportable forecasts. This is significantly different from the current model that increases the allowance when losses are probable. Initially, ASU 2016-13 was effective for all public companies for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years, and will be applied with a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which the guidance is effective. The FASB subsequently issued ASU 2019-04 (“ASU 2019-04”): Codification Improvements to Topic 326, Financial Instruments – Credit Losses, Topic 815, Derivatives, and Topic 825, Financial Instruments and ASU 2019-05 (“ASU 2019-05”): Financial Instruments-Credit Losses (Topic 326) – Targeted Transition Relief. ASU 2019-04 and ASU 2019-05 provide certain codification improvements related to implementation of ASU 2016-13 and targeted transition relief consisting of an option to irrevocably elect the fair value option for eligible instruments. In November 2019, the FASB issued ASU 2019-10 – Financial Instruments – Credit Losses (Topic 326), Derivatives and Hedging (Topic 815), and Leases (Topic 842): Effective Dates. This amendment deferred the effective date of ASU 2016-13 from January 1, 2020 to January 1, 2023 for calendar year-end smaller reporting companies, which includes the Company. The Company plans to defer the implementation of ASU 2016-13, and the related updates. In November 2019, the FASB issued ASU 2019-12 – Income Taxes (“Topic 740”): Simplifying the Accounting for Income Taxes. The amendments in ASU 2019-12 are part of an initiative to reduce complexity in accounting standards and simplify the accounting for income taxes by removing certain exceptions from Topic 740 and making minor improvements to the codification. The amendments in this update are effective for public entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020. The provisions of this update are not expected to have a material impact on the Company’s financial position or results of operations. In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting (“ASU 2020-04”). ASU 2020-04 provides optional expedients and exceptions for applying GAAP to contract modifications and hedging relationships, subject to meeting certain criteria, that reference LIBOR or another rate that is expected to be discontinued. ASU 2020-04 will be in effect through December 31, 2022. We are currently assessing the potential impact of ASU 2020-04 on our consolidated financial statements.

Dispositions

Dispositions	6 Months Ended
	Jun. 30, 2020
Dispositions
Dispositions	3. Dispositions On June 1, 2020, the Company closed on the sale of certain producing and non-producing properties located in its Central Oklahoma and Western Anadarko regions. These properties were acquired in the Will Energy acquisition and were sold in exchange for the buyer’s assumption of the plugging and abandonment liabilities of these properties and revenue held in suspense . The Company recorded a gain of $4.2 million as a result of the buyer’s assumption of the asset retirement obligations associated with the sold properties. On April 1, 2020, the Company closed on the sale of certain non-producing properties located in its Central Oklahoma region. These properties were acquired in the White Star acquisition and were sold for approximately $0.5 million. The Company recorded a gain of $0.2 million as a result of the buyer’s assumption of the asset retirement obligations associated with the sold properties. On June 10, 2019, the Company sold certain minor, non-core operated assets located in Lavaca and Wharton counties, Texas in exchange for the buyer’s assumption of the plugging and abandonment liabilities of the properties. The Company recorded a gain of $0.4 million as a result of the buyer’s assumption of the asset retirement obligations associated with the sold properties.

Fair Value Measurements

Fair Value Measurements	6 Months Ended
	Jun. 30, 2020
Fair Value Measurements
Fair Value Measurements	4. Fair Value Measurements The Company's determination of fair value incorporates not only the credit standing of the counterparties involved in transactions with the Company resulting in receivables on the Company's consolidated balance sheets, but also the impact of the Company's nonperformance risk on its own liabilities. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). A fair value hierarchy prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy assigns the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). Level 2 measurements are inputs that are observable for assets or liabilities, either directly or indirectly, other than quoted prices included within Level 1. The Company utilizes market data or assumptions that market participants would use in pricing the asset or liability, including assumptions about risk and the risks inherent in the inputs to the valuation technique. These inputs can be readily observable, market corroborated, or generally unobservable. The Company classifies fair value balances based on the observability of those inputs. The following table sets forth, by level within the fair value hierarchy, the Company’s financial assets and liabilities that were accounted for at fair value as of June 30, 2020. A financial instrument's level within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. The Company’s assessment of the significance of a particular input to the fair value measurement requires judgment and may affect the valuation of fair value assets and liabilities and their placement within the fair value hierarchy levels. There have been no transfers between Level 1, Level 2 or Level 3. Fair value information for financial assets and liabilities was as follows as of June 30, 2020 (in thousands): Total Fair Value Measurements Using Carrying Value Level 1 Level 2 Level 3 Derivatives Commodity price contracts - assets $ 21,221 $ — $ 21,221 $ — Commodity price contracts - liabilities $ (1,825) $ — $ (1,825) $ — Derivatives listed above are recorded in “Current derivative asset or liability” and “Long-term derivative asset or liability” on the Company’s consolidated balance sheet and include swaps and costless collars that are carried at fair value. The Company records the net change in the fair value of these positions in “Gain (loss) on derivatives, net” in its consolidated statements of operations. The Company is able to value the assets and liabilities based on observable market data for similar instruments, which resulted in reporting its derivatives as Level 2. This observable data includes the forward curves for commodity prices based on quoted market prices and implied volatility factors related to changes in the forward curves. See Note 5 – “Derivative Instruments” for additional discussion of derivatives. As of June 30, 2020, the Company’s derivative contracts were all with major institutions with investment grade credit ratings which are believed to have minimal credit risk, which primarily are lenders within the Company’s bank group. As such, the Company is exposed to credit risk to the extent of nonperformance by the counterparties in the derivative contracts discussed above; however, the Company does not anticipate such nonperformance. Estimates of the fair value of financial instruments are determined at discrete points in time based on relevant market information. These estimates involve uncertainties and cannot be determined with precision. The estimated fair value of cash, accounts receivable and accounts payable approximates their carrying value due to their short-term nature. The estimated fair value of the Company’s Credit Agreement approximates carrying value because the facility interest rate approximates current market rates and is reset at least every quarter. See Note 10 – “Long-Term Debt” for further information. Impairments The Company tests proved oil and natural gas properties for impairment when events and circumstances indicate a decline in the recoverability of the carrying value of such properties, such as a downward revision of the reserve estimates or lower commodity prices. The Company estimates the undiscounted future cash flows expected in connection with the oil and gas properties on a region basis and compares such future cash flows to the unamortized capitalized costs of the properties. If the estimated future undiscounted cash flows are lower than the unamortized capitalized cost, the capitalized cost is reduced to its fair value. The factors used to determine fair value include, but are not limited to, estimates of proved, probable and possible reserves, future commodity prices, the timing of future production and capital expenditures and a discount rate commensurate with the risk reflective of the lives remaining for the respective oil and gas properties. Additionally, the Company may use appropriate market data to determine fair value. Because these significant fair value inputs are typically not observable, impairments of long-lived assets are classified as a Level 3 fair value measure. Unproved properties are reviewed quarterly to determine if there has been impairment of the carrying value, with any such impairment charged to expense in the period. Asset Retirement Obligations The initial measurement of asset retirement obligations at fair value is calculated using discounted cash flow techniques and based on internal estimates of future retirement costs associated with oil and gas properties. The factors used to determine fair value include, but are not limited to, estimated future plugging and abandonment costs and expected lives of the related reserves. As there is no corroborating market activity to support the assumptions used, the Company has designated these liabilities as Level 3.

Derivative Instruments

Derivative Instruments	6 Months Ended
	Jun. 30, 2020
Derivative Instruments [Abstract]
Derivative Instruments	5. Derivative Instruments The Company is exposed to certain risks relating to its ongoing business operations, such as commodity price risk. Derivative contracts are typically utilized to hedge the Company’s exposure to price fluctuations and reduce the variability in the Company’s cash flows associated with anticipated sales of future oil and natural gas production. The Company typically hedges a substantial, but varying, portion of anticipated oil and natural gas production for future periods. The Company believes that these derivative arrangements, although not free of risk, allow it to achieve a more predictable cash flow and to reduce exposure to commodity price fluctuations. However, derivative arrangements limit the benefit of increases in the prices of oil, natural gas and natural gas liquids sales. Moreover, because its derivative arrangements apply only to a portion of its production, the Company’s strategy provides only partial protection against declines in commodity prices. Such arrangements may expose the Company to risk of financial loss in certain circumstances. The Company continuously reevaluates its hedging programs in light of changes in production, market conditions and commodity price forecasts. As of June 30, 2020, the Company’s oil and natural gas derivative positions consisted of swaps and costless collars. Swaps are designed so that the Company receives or makes payments based on a differential between fixed and variable prices for oil and natural gas. A costless collar consists of a purchased put option and a sold call option, which establishes a minimum and maximum price, respectively, that the Company will receive for the volumes under the contract. It is the Company’s policy to enter into derivative contracts only with counterparties that are creditworthy institutions deemed by management as competent and competitive market makers. The Company does not post collateral, nor is it exposed to potential margin calls, under any of these contracts, as they are secured under the Credit Agreement (as defined below) or under unsecured lines of credit with non-bank counterparties. See Note 10 – “Long-Term Debt” for further information regarding the Credit Agreement. The Company has elected not to designate any of its derivative contracts for hedge accounting. Accordingly, derivatives are carried at fair value on the consolidated balance sheets as assets or liabilities, with the changes in the fair value included in the consolidated statements of operations for the period in which the change occurs. The Company records the net change in the mark-to-market valuation of these derivative contracts, as well as all payments and receipts on settled derivative contracts, in “Gain (loss) on derivatives, net” on the consolidated statements of operations. As of June 30, 2020, the following financial derivative instruments were in place (fair value in thousands): Commodity Period Derivative Volume/Month Price/Unit Fair Value Oil July 2020 - Oct 2020 Collar 3,442 Bbls $ - (1) $ Oil July 2020 - Dec 2020 Swap 15,000 Bbls $ 57.74 (1) $ Oil July 2020 Swap 5,500 Bbls $ 54.33 (1) $ Oil Aug 2020 - Oct 2020 Swap 2,500 Bbls $ 54.33 (1) $ Oil Nov 2020 - Dec 2020 Swap 3,500 Bbls $ 54.33 (1) $ Oil July 2020 Swap 37,500 Bbls $ 54.70 (1) $ Oil Aug 2020 - Dec 2020 Swap 35,000 Bbls $ 54.70 (1) $ Oil July 2020 Swap 37,500 Bbls $ 54.58 (1) $ Oil Aug 2020 - Dec 2020 Swap 35,000 Bbls $ 54.58 (1) $ Oil Jan 2021 - March 2021 Swap 19,000 Bbls $ 50.00 (1) $ Oil April 2021 - July 2021 Swap 12,000 Bbls $ 50.00 (1) $ Oil Aug 2021 - Sept 2021 Swap 10,000 Bbls $ 50.00 (1) $ Oil Jan 2021 - July 2021 Swap 62,000 Bbls $ 52.00 (1) $ Oil Aug 2021 - Sept 2021 Swap 55,000 Bbls $ 52.00 (1) $ Oil Oct 2021 - Dec 2021 Swap 64,000 Bbls $ 52.00 (1) $ Natural Gas Aug 2020 - Oct 2020 Swap 40,000 Mmbtus $ 2.532 (2) $ Natural Gas Nov 2020 - Dec 2020 Swap 375,000 Mmbtus $ 2.696 (2) $ Natural Gas July 2020 Swap 400,000 Mmbtus $ 2.53 (2) $ Natural Gas Aug 2020 - Dec 2020 Swap 350,000 Mmbtus $ 2.53 (2) $ Natural Gas July 2020 Swap 400,000 Mmbtus $ 2.532 (2) $ Natural Gas Aug 2020 - Dec 2020 Swap 350,000 Mmbtus $ 2.532 (2) $ Natural Gas Jan 2021 - March 2021 Swap 185,000 Mmbtus $ 2.505 (2) $ Natural Gas April 2021 - July 2021 Swap 120,000 Mmbtus $ 2.505 (2) $ Natural Gas Aug 2021 - Sept 2021 Swap 10,000 Mmbtus $ 2.505 (2) $ Natural Gas Jan 2021 - March 2021 Swap 185,000 Mmbtus $ 2.508 (2) $ Natural Gas April 2021 - July 2021 Swap 120,000 Mmbtus $ 2.508 (2) $ Natural Gas Aug 2021 - Sept 2021 Swap 10,000 Mmbtus $ 2.508 (2) $ Natural Gas Jan 2021 - March 2021 Swap 650,000 Mmbtus $ 2.508 (1) $ Natural Gas April 2021 - Oct 2021 Swap 400,000 Mmbtus $ 2.508 (1) $ Natural Gas Nov 2021 - Dec 2021 Swap 580,000 Mmbtus $ 2.508 (2) $ Natural Gas April 2021 - Nov 2021 Swap 70,000 Mmbtus $ 2.36 (2) $ Natural Gas Dec 2021 Swap 350,000 Mmbtus $ 2.36 (2) $ Natural Gas Jan 2022 - March 2022 Swap 780,000 Mmbtus $ 2.542 (2) $ Total net fair value of derivative instruments $ 19,396 (1) Based on West Texas Intermediate oil prices. (2) Based on Henry Hub NYMEX natural gas prices. In addition to the above financial derivative instruments, the Company also had a costless swap agreement with a Midland WTI – Cushing oil differential swap price of $0.05 per barrel of oil. The agreement fixes the Company’s exposure to that differential on 10,000 barrels per month for July 2020 through December 2020. The fair value of this costless swap agreement was zero as of June 30, 2020. The following summarizes the fair value of commodity derivatives outstanding on a gross and net basis as of June 30, 2020 (in thousands): Gross Netting (1) Total Assets $ 21,221 $ — $ 21,221 Liabilities $ (1,825) $ — $ (1,825) (1) Represents counterparty netting under agreements governing such derivatives. The following summarizes the fair value of commodity derivatives outstanding on a gross and net basis as of December 31, 2019 (in thousands): Gross Netting (1) Total Assets $ 4,176 $ — $ 4,176 Liabilities $ (5,971) $ — $ (5,971) (1) Represents counterparty netting under agreements governing such derivatives. The following table summarizes the effect of derivative contracts on the consolidated statements of operations for the three and six months ended June 30, 2020 and 2019 (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2020 2019 2020 2019 Oil contracts $ 8,461 $ 286 $ 11,258 $ 941 Natural gas contracts 2,933 211 5,445 324 Realized gain $ 11,394 $ 497 $ 16,703 $ 1,265 Oil contracts $ (16,557) $ 365 $ 24,170 $ (3,077) Natural gas contracts (3,641) 1,203 (2,978) 999 Unrealized gain (loss) $ (20,198) $ 1,568 $ 21,192 $ (2,078) Gain (loss) on derivatives, net $ (8,804) $ 2,065 $ 37,895 $ (813)

Stock Based Compensation

Stock Based Compensation	6 Months Ended
	Jun. 30, 2020
Stock-Based Compensation [Abstract]
Stock-Based Compensation	6. Stock-Based Compensation Amended and Restated 2009 Incentive Compensation Plan On June 8, 2020, the stockholders of the Company approved the third amendment to the Amended and Restated 2009 Incentive Compensation Plan (as amended, the “Plan”) in the form of an amendment and restatement of the Plan that, among other things, increases the number of shares of the Company’s common stock authorized for issuance pursuant to the Plan by 9,000,000 shares and increases the maximum aggregate number of shares of common stock that may be granted to any individual during any calendar year from 250,000 to 1,000,000. The Plan allows for stock options, restricted stock or performance stock units to be awarded to officers, directors and employees as a performance-based award. Restricted Stock During the six months ended June 30, 2020, the Company granted 152,248 shares of restricted common stock, which vest over one year, to directors pursuant to the Company’s Director Compensation Plan. The weighted average fair value of the restricted shares granted during the six months ended June 30, 2020, was $2.42 per share, with a total fair value of approximately $0.4 million and no adjustment for an estimated weighted average forfeiture rate. There were 2,539 forfeitures of restricted stock during the six months ended June 30, 2020. The aggregate intrinsic value of restricted shares forfeited during the six months ended June 30, 2020 was approximately $10 thousand. In July 2020, the Company granted 1,037,969 shares of restricted common stock, which vest ratably over three years, to employees as part of their overall compensation package. The weighted average fair value of the restricted shares granted in July 2020, was $2.24 per share, with a total fair value of approximately $2.3 million and no adjustment for an estimated weighted average forfeiture rate. The Company recognized approximately $0.4 million in restricted stock compensation expense during the six months ended June 30, 2020 related to restricted stock previously granted to its officers, employees and directors. As of June 30, 2020, an additional $0.8 million of compensation expense related to restricted stock remained to be recognized over the remaining weighted-average vesting period of 1.3 years. Approximately 10.1 million shares remained available for grant under the Amended and Restated 2009 Incentive Compensation Plan as of June 30, 2020, assuming PSUs (as defined below) are settled at 100% of target. During the six months ended June 30, 2019, the Company granted 307,650 shares of restricted common stock, which vest ratably over three years, to employees and executive officers as part of their overall compensation package. Additionally, during the six months ended June 30, 2019, the Company granted 80,410 shares of restricted common stock, which vest over one year, to directors pursuant to the Company’s Director Compensation Plan. The weighted average fair value of the restricted shares granted during the six months ended June 30, 2019, was $2.91 per share, with a total fair value of approximately $1.1 million and no adjustment for an estimated weighted average forfeiture rate. During the six months ended June 30, 2019, 38,161 restricted shares were forfeited by former employees. The aggregate intrinsic value of restricted shares forfeited during the six months ended June 30, 2019 was approximately $0.2 million. The Company recognized approximately $1.4 million in restricted stock compensation expense during the six months ended June 30, 2019 related to restricted stock granted to its officers, employees and directors. Performance Stock Units Performance stock units (“PSUs”) represent the opportunity to receive shares of the Company’s common stock at the time of settlement. The number of shares to be awarded upon settlement of these PSUs may range from 0% to 300% of the targeted number of PSUs stated in the agreement, contingent upon the achievement of certain share price appreciation targets as compared to a peer group index over a three year performance period. The PSUs vest at the end of the three year performance period, with the final number of shares to be granted determined at that time, based on the Company’s share performance during the period compared to the average performance of the peer group. Compensation expense associated with PSUs is based on the grant date fair value of a single PSU as determined using the Monte Carlo simulation model which utilizes a stochastic process to create a range of potential future outcomes given a variety of inputs. As it is contemplated that the PSUs will be settled with shares of the Company’s common stock after three years, the PSU awards are accounted for as equity awards, and the fair value is calculated on the grant date. The simulation model calculates the payout percentage based on the stock price performance over the performance period. The concluded fair value is based on the average achievement percentage over all the iterations. The resulting fair value expense is amortized over the life of the PSU award. There were no grants or forfeitures of PSUs during the six months ended June 30, 2020. In July 2020, Company granted 2,608,640 PSUs to its executive officers and certain employees as part of their overall compensation package. The performance period will be measured between January 1, 2020 and December 31, 2022. These granted PSUs were valued at a weighted average fair value of $4.90 per unit. In January 2020, 77,485 shares of the PSUs granted in 2017 vested, of which 22,972 PSUs were withheld for taxes, and are included with the restricted stock activity in the consolidated statement of shareholders’ equity. No PSUs were forfeited during the six months ended June 30, 2020. The Company recognized approximately $0.2 million in stock compensation expense related to PSUs during the six months ended June 30, 2020. As of June 30, 2020, an additional $0.5 million of compensation expense related to PSUs remained to be recognized over the remaining weighted-average vesting period of 1.4 years. During the six months ended June 30, 2019, the Company granted 117,105 PSUs to executive officers and certain employees as part of their overall compensation package, which will be measured between January 1, 2019 and December 31, 2021, and were valued at a weighted average fair value of $6.42 per unit. All fair value prices were determined using the Monte Carlo simulation model. During the six months ended June 30, 2019, 49,773 PSUs were forfeited due to the resignations of the Company’s former Senior Vice President of Exploration and Senior Vice President of Operations and Engineering in February 2019. The Company recognized approximately $0.3 million in stock compensation expense related to PSUs during the six months ended June 30, 2019. Stock Options Under the fair value method of accounting for stock options, cash flows from the exercise of stock options resulting from tax benefits in excess of recognized cumulative compensation cost (excess tax benefits) are classified as financing cash flows. For the six months ended June 30, 2020 and 2019, there was no excess tax benefit recognized. Compensation expense related to stock option grants are recognized over the stock option’s vesting period based on the fair value at the date the options are granted. The fair value of each option is estimated as of the date of grant using the Black-Scholes options-pricing model. No stock options were granted during the six months ended June 30, 2020 or 2019. During the six months ended June 30, 2020, no stock options were exercised and stock options for 411 shares were forfeited by former employees. During the six months ended June 30, 2019, no stock options were exercised and stock options for 12,052 shares were forfeited by former employees.

Leases

Leases	6 Months Ended
	Jun. 30, 2020
Leases
Leases	7. Leases During the six months ended June 30, 2020, the Company entered into new compressor contracts with lease terms of twelve months or more, which qualify as operating leases. The Company also entered into new contracts for vehicles and office equipment with lease terms of twelve months or more, which qualify as finance leases. As of June 30, 2020, the Company’s operating leases were for compressors and office space at its two corporate offices and three field offices, while the Company’s finance leases were for vehicles and office equipment. The Company also has compressor contracts which are on a month-to-month basis, and while it is probable the contracts will be renewed on a monthly basis, the compressors can be easily substituted or cancelled by either party, with minimal penalties. Leases with these terms are not included on the Company’s balance sheet and are recognized on the statement of operations on a straight-line basis over the lease term. The following table summarizes the balance sheet information related to the Company’s leases as of June 30, 2020 and December 31, 2019 (in thousands): June 30, 2020 December 31, 2019 Operating lease right of use asset (1) $ 3,993 $ 4,316 Operating lease liability - current (2) $ (2,897) $ (2,597) Operating lease liability - long-term (3) (1,045) (1,738) Total operating lease liability $ (3,942) $ (4,335) Financing lease right of use asset (1) $ 1,698 $ 1,569 Financing lease liability - current (2) $ (605) $ (524) Financing lease liability - long-term (3) (1,111) (1,051) Total financing lease liability $ (1,716) $ (1,575) (1) Included in “Right-of-use lease assets” on the consolidated balance sheet. (2) Included in “Accounts payable and accrued liabilities” on the consolidated balance sheet. (3) Included in “Lease liabilities” on the consolidated balance sheet. The Company’s leases generally do not provide an implicit rate, and therefore the Company uses its incremental borrowing rate as the discount rate when measuring operating and financing lease liabilities. The incremental borrowing rate represents an estimate of the interest rate the Company would incur at lease commencement to borrow an amount equal to the lease payments on a collateralized basis over the term of a lease within a particular currency environment. For leases existing prior to January 1, 2019, the incremental borrowing rate as of January 1, 2019 was used for the remaining lease term. The table below presents the weighted average remaining lease terms and weighted average discount rates for the Company’s leases as of June 30, 2020 and December 31, 2019: June 30, 2020 December 31, 2019 Weighted Average Remaining Lease Terms (in years): Operating leases Financing leases Weighted Average Discount Rate: Operating leases Financing leases Maturities for the Company’s lease liabilities on the consolidated balance sheet as of June 30, 2020, were as follows (in thousands): June 30, 2020 Operating Leases Financing Leases 2020 (remaining after June 30, 2020) $ 3,040 $ 690 2021 702 552 2022 168 475 2023 171 156 2024 72 7 Total future minimum lease payments 4,153 1,880 Less: imputed interest (211) (164) Present value of lease liabilities $ 3,942 $ 1,716 The following table summarizes expenses related to the Company’s leases for the three months ended June 30, 2020 and 2019 (in thousands): Three Months Ended June 30, 2020 Three Months Ended June 30, 2019 Operating lease cost (1) (2) $ 743 $ 100 Financing lease cost - amortization of right-of-use assets 155 - Financing lease cost - interest on lease liabilities 27 - Administrative lease cost (3) 19 18 Short-term lease cost (1) (4) 615 2,068 Total lease cost $ 1,559 $ 2,186 (1) This total does not reflect amounts that may be reimbursed by other third parties in the normal course of business, such as non-operating working interest owners. (2) Costs related to office leases and compressors with lease terms of twelve months or more. (3) Costs related primarily to office equipment and IT solutions with lease terms of more than one month and less than one year. (4) Costs related primarily to drilling rigs, generators and compressor agreements with lease terms of more than one month and less than one year. The following table summarizes expenses related to the Company’s leases for the six months ended June 30, 2020 and 2019 (in thousands): Six Months Ended June 30, 2020 Six Months Ended June 30, 2019 Operating lease cost (1) (2) $ 1,430 $ 471 Financing lease cost - amortization of right-of-use assets 284 - Financing lease cost - interest on lease liabilities 52 - Administrative lease cost (3) 38 37 Short-term lease cost (1) (4) 1,053 2,578 Total lease cost $ 2,857 $ 3,086 (1) This total does not reflect amounts that may be reimbursed by other third parties in the normal course of business, such as non-operating working interest owners. (2) Costs related to office leases and compressors with lease terms of twelve months or more. (3) Costs related primarily to office equipment and IT solutions with lease terms of more than one month and less than one year. (4) Costs related primarily to drilling rigs, generators and compressor agreements with lease terms of more than one month and less than one year. During the six months ended June 30, 2020, there were $1.5 million and $0.3 million in cash payments related to operating leases and financing leases, respectively. During the six months ended June 30, 2019, there were $0.1 million in cash payments related to operating leases. No cash payments were made for the financing leases during the six months ended June 30, 2019.

Other Financial Information

Other Financial Information	6 Months Ended
	Jun. 30, 2020
Other Financial Information [Abstract]
Other Financial Information	8. Other Financial Information The following table provides additional detail for accounts receivable, prepaid expenses, inventory and accounts payable and accrued liabilities which are presented on the consolidated balance sheets (in thousands): June 30, 2020 December 31, 2019 Accounts receivable: Trade receivables (1) $ 9,527 $ 21,110 Receivable for Alta Resources distribution 1,712 1,712 Joint interest billings 12,220 13,104 Income taxes receivable 268 509 Other receivables 2,939 4,126 Allowance for doubtful accounts (994) (994) Total accounts receivable $ 25,672 $ 39,567 Prepaid expenses: Prepaid insurance $ 335 $ 683 Other (2) 1,028 508 Total prepaid expenses $ 1,363 $ 1,191 Inventory: Oil storage (3) $ 947 $ — Materials and supplies 763 186 Total inventory $ 1,710 $ 186 Accounts payable and accrued liabilities: Royalties and revenue payable $ 39,950 $ 49,644 Advances from partners (4) 868 6,733 Accrued exploration and development (4) 1,463 8,210 Trade payables 15,192 14,086 Accrued general and administrative expenses (5) 5,739 12,037 Accrued operating expenses 8,881 5,794 Accrued operating and finance leases 3,502 3,120 Other accounts payable and accrued liabilities 1,548 4,969 Total accounts payable and accrued liabilities $ 77,143 $ 104,593 (1) Decrease in 2020 primarily due to lower receivables from oil sales as a result of the dramatic decline in oil prices in 2020. (2) Other prepaids primarily includes software licenses and additional licenses purchased in relation to the properties acquired from Will Energy and White Star. (3) Includes approximately 50,000 Bbls of oil (net to the Company) produced during the three months ended June 30, 2020, held as inventory in the Company’s Central Oklahoma region and sold in the third quarter of 2020. (4) Decrease in 2020 due to a decrease in drilling and completion activity. In January 2020, the Company brought one West Texas well online but suspended further drilling in the area, and in its other onshore areas, in response to the dramatic decline in oil prices during the year. (5) Includes accruals for legal judgments, of which $6.3 million was paid in April 2020. See Note 12 – “Commitment and Contingencies” for further information. Included in the table below are supplemental cash flow disclosures and non-cash investing activities during the six months ended June 30, 2020 and 2019 (in thousands): Six Months Ended June 30, 2020 2019 Cash payments: Interest payments $ 2,006 $ 2,157 Income tax payments $ 83 $ 805 Non-cash investing activities in the consolidated statements of cash flows: Increase (decrease) in accrued capital expenditures $ (7,095) $ 475

Investment In Exaro Energy III

Investment In Exaro Energy III LLC	6 Months Ended
	Jun. 30, 2020
Investment In Exaro Energy III LLC [Abstract]
Investment In Exaro Energy III LLC	9. Investment in Exaro Energy III LLC The Company maintains an ownership interest in Exaro of approximately 37%. The Company’s share in the equity of Exaro at June 30, 2020 was approximately $6.9 million. The Company accounts for its ownership in Exaro using the equity method of accounting, and therefore, does not include its share of individual operating results or production in those reported for the Company’s consolidated results. The Company’s share in Exaro’s results of operations recognized for the three months ended June 30, 2020 and 2019 was a loss of $0.2 million, net of no tax expense and a gain of $0.4 million, net of no tax expense, respectively. The Company’s share in Exaro’s results of operations recognized for the six months ended June 30, 2020 and 2019 was a gain of $0.1 million, net of no tax expense, and a gain of $0.7 million, net of no tax expense, respectively.

Long-Term Debt

Long-Term Debt	6 Months Ended
	Jun. 30, 2020
Long-Term Debt
Long-Term Debt	10. Long-Term Debt Credit Agreement On September 17, 2019, the Company entered into its new revolving credit agreement with JPMorgan Chase Bank and other lenders (as amended, the “Credit Agreement”), which established a borrowing base of $65 million. The Credit Agreement was amended on November 1, 2019, in conjunction with the closing of the acquisitions of certain producing assets and undeveloped acreage from Will Energy and White Star, to add two additional lenders and increase the borrowing base thereunder to $145 million. The borrowing base is subject to semi-annual redeterminations which will occur on or around May 1 st and November 1 st of each year. On June 9, 2020, the Company entered into the Second Amendment to the Credit Agreement (the “Second Amendment”). The Second Amendment redetermined the borrowing base at $95 million pursuant to the regularly scheduled redetermination process. The Second Amendment also provides for, among other things, further $10 million automatic reductions in the borrowing base on each of June 30, 2020 and September 30, 2020. As a result, the borrowing base was $85 million as of June 30, 2020. The borrowing base may also be adjusted by certain events, including the incurrence of any senior unsecured debt, material asset dispositions or liquidation of hedges in excess of certain thresholds. The Credit Agreement matures on September 17, 2024 . The Company initially incurred $1.8 million of arrangement and upfront fees in connection with the Credit Agreement and incurred an additional $1.6 million in fees for the first amendment to the Credit Agreement, which is to be amortized over the five year term of the Credit Agreement. No fees were paid for the Second Amendment. However, during the three months ended June 30, 2020 the Company expensed $1.0 million of the fees discussed above, which originally were to be amortized over the life of the loan, due to the reduction in the borrowing base per the Second Amendment. As of June 30, 2020, the remaining amortizable balance of these fees was $1.9 million, which will be amortized through September 17, 2024. As of June 30, 2020, the Company had approximately $79.1 million outstanding under the Credit Agreement and $1.9 million in an outstanding letter of credit. As of December 31, 2019, the Company had approximately $72.8 million outstanding under the Credit Agreement and $1.9 million in an outstanding letter of credit. As of June 30, 2020, borrowing availability under the Credit Agreement was $4.0 million. Total interest expense under the Company’s current and previous credit agreements, including commitment fees and the additional $1.0 million in expensed loan fees discussed above, for the three and six months ended June 30, 2020 was approximately $2.2 million and $3.4 million, respectively. Total interest expense under the credit facility, including commitment fees, for the three and six months ended June 30, 2019 was approximately $1.1 million and $2.2 million, respectively. The weighted average interest rates in effect at June 30, 2020 and December 31, 2019 were 4.0% and 4.3%, respectively. The Credit Agreement is collateralized by liens on substantially all of the Company’s oil and gas properties and other assets and security interests in the stock of its wholly owned and/or controlled subsidiaries. The Company’s wholly owned and/or controlled subsidiaries are also required to join as guarantors under the Credit Agreement. The Credit Agreement contains customary and typical restrictive covenants. The Credit Agreement requires a Current Ratio of greater than or equal to 1.00 and a Leverage Ratio of less than or equal to 3.50, both as defined in the Credit Agreement. The Second Amendment includes a waiver of the Current Ratio requirement until the quarter ending March 31, 2022. Additionally, the Second Amendment, among other things, provides for an increase in the Applicable Margin grid on borrowings outstanding of 50 basis points, and includes provisions requiring monthly aged accounts payable reports and typical anti-cash hoarding and cash sweep provisions with respect to a consolidated cash balance in excess of $5.0 million. The Credit Agreement also contains events of default that may accelerate repayment of any borrowings and/or termination of the facility. Events of default include, but are not limited to, a going concern qualification, payment defaults, breach of certain covenants, bankruptcy, insolvency or change of control events. As of June 30, 2020, the Company was in compliance with all of its covenants under the Credit Agreement. Paycheck Protection Program Loan On April 10, 2020, the Company entered into a promissory note evidencing an unsecured loan in the amount of approximately $3.4 million (the “PPP Loan”) made to the Company under the Paycheck Protection Program (the “PPP”). The PPP was established under the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”), signed into law on March 27, 2020, and is administered by the U.S. Small Business Administration. The PPP Loan to the Company is being made through JPMorgan Chase Bank, N.A and is included in “Long Term Debt” on the Company’s consolidated balance sheet. The PPP Loan matures on the two-year anniversary of the funding date and bears interest at a fixed rate of 1.00% per annum. Monthly principal and interest payments, less the amount of any potential forgiveness (discussed below), will commence after the six-month anniversary of the funding date. The promissory note evidencing the PPP Loan provides for customary events of default, including, among others, those relating to failure to make payment, bankruptcy, breaches of representations and material adverse effects. The Company may prepay the principal of the PPP Loan at any time without incurring any prepayment charges. Under the terms of the CARES Act, PPP loan recipients can apply for and be granted forgiveness for all or a portion of the loans granted under the PPP, subject to an audit. Under the CARES Act, loan forgiveness is available, subject to limitations, for the sum of documented payroll costs, covered mortgage interest payments, covered rent payments and covered utilities during either: (1) the eight-week period beginning on the funding date; or (2) the 24-week period beginning on the funding date. Forgiveness is reduced if full-time employee headcount declines, or if salaries and wages for employees with salaries of $100,000 or less annually are reduced by more than 25%. The Company intends to use the PPP Loan amount for qualifying expenses and expects to apply for forgiveness of all or part of the PPP Loan in accordance with the terms of the CARES Act and related guidance. In the event the PPP Loan or any portion thereof is forgiven, the amount forgiven is applied to the outstanding principal.

Income Taxes

Income Taxes	6 Months Ended
	Jun. 30, 2020
Income Taxes [Abstract]
Income Taxes	11. Income Taxes The Company’s income tax provision for continuing operations consists of the following (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2020 2019 2020 2019 Current tax provision: Federal $ — $ — $ 275 $ — State (7) 427 112 454 Total $ (7) $ 427 $ 387 $ 454 Deferred tax provision: Federal $ — $ — $ — $ — State 376 — 376 — Total $ 376 $ — $ 376 $ — Total tax provision: Federal $ — $ — $ 275 $ — State 369 427 488 454 Total income tax provision: $ 369 $ 427 $ 763 $ 454 The Federal income tax expense results from an adjustment in the previous period of the credit for Alternative Minimum Tax (“AMT”) paid in prior years. As a result of the tax reform in 2017, the corporate AMT was repealed, and any AMT credit was made refundable. The first half of the credit was refunded when the Company filed its 2018 federal income tax return, and the second half of the credit will be refundable when the Company files its tax return for the tax year ended December 31, 2019. The CARES Act modified the timing of these refunds, allowing the Company to request an expedited refund of $0.3 million this quarter. This amount was previously accounted for as an income tax benefit when the corporate AMT was repealed. State income tax expense relates to income taxes for the quarter and the six months which are expected to be owed to the states of Louisiana and Oklahoma resulting from activities within those states and, in each case, that are not shielded by existing Federal tax attributes. Additionally, under the CARES Act, the Company will benefit from an amendment to Internal Revenue Code Section 163(j) that temporarily increases deductible interest expense limitations. Specifically, the CARES Act increases the 30% Adjusted Taxable Income (“ATI”) limitation to 50% of ATI for taxable years beginning in each of 2019 and 2020. This will have the effect of allowing the Company to use a Section 163(j) carryover from the prior year that was not limited by Section 382 (discussed below). In addition, the Company used relief granted by the Oklahoma Tax Commission and the Louisiana Tax Commission to extend the due date for the first quarter estimated income tax payments to the states of Oklahoma and Louisiana to July 15, 2020. No Federal estimated tax payments for 2020 are expected. The Company does not expect to benefit from any other income tax-related provisions of the CARES Act. In assessing the realizability of deferred tax assets, the Company considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. The Company considers the scheduled reversal of deferred tax liabilities, projected future taxable income and tax planning strategies in making this assessment. Based upon the amount of deferred tax liabilities, level of historical taxable income and projections for future taxable income over the periods in which the deferred tax assets are deductible, the Company believes it is not more-likely-than-not that it will realize the benefits of these deductible differences and, therefore, adjusted valuation allowances for federal and state purposes (with the exception of Oklahoma) to $132.0 million and $1.6 million, respectively, as of June 30, 2020. Oklahoma deferred tax expense of $0.4 million was recognized during the quarter ended June 30, 2020. No Oklahoma valuation allowance has been recorded as of June 30, 2020. The $28.5 million net increase from the valuation allowance recorded at December 31, 2019, like other items in the Company’s accounting for income taxes during the current quarter, was determined using a specific June 30, 2020 cut-off date as an accurate estimate of 2020 pre-tax income or income tax expense cannot be reliably made at this time. The Company will continue to assess the valuation allowance against deferred tax assets considering all available information obtained in future reporting periods. As of June 30, 2020, the Company had federal net operating loss (“NOL”) carryforwards of approximately $398.7 million and state NOLs of $32.7 million. The Federal NOL carryforwards occurred due to the merger with Crimson Exploration, Inc. in 2013 and subsequent taxable losses during the years 2014 through 2019 due to lower commodity prices and utilization of various elections available to the Company in expensing capital expenditures incurred in the development of oil and gas properties. Generally, these NOLs are available to reduce future taxable income and the related income tax liability subject to the limitations set forth in Internal Revenue Code Section 382 related to changes of more than 50% of ownership of the Company’s stock by 5% or greater shareholders over a three-year period (a Section 382 Ownership Change) from the time of such an ownership change. The Company experienced two separate Section 382 Ownership Changes in connection with two of its equity offerings occurring in 2018 and 2019, respectively (the “Ownership Changes”). Market conditions at the time of the 2019 Ownership Change had diminished from the time of the 2018 Ownership Change, thus subjecting virtually all of the Company’s tax attributes to an annual limitation of $0.7 million a year (in pre-tax dollars). This lower annual limitation resulting from the 2019 Ownership Change effectively eliminates the ability to utilize these tax attributes in the future. During the quarter ended June 30, 2020, the Company had no activity resulting in an additional Section 382 Ownership Change. The CARES Act temporarily suspends the Section 172 limitation for NOLs arising in tax years beginning in 2018, 2019 and 2020 and also allows NOLs originating in these years to be carried back five years; however, the Company does not expect to receive any federal tax refunds from the temporary suspension of the Section 172 limitation because the Company incurred tax losses in each of the carryback years.

Commitments and Contingencies

Commitments and Contingencies	6 Months Ended
	Jun. 30, 2020
Commitments And Contingencies [Abstract]
Commitments and Contingencies	12. Commitments and Contingencies Legal Proceedings From time to time, the Company is involved in legal proceedings relating to claims associated with its properties, operations or business or arising from disputes with vendors in the normal course of business, including the material matters discussed below. In November 2010, a subsidiary of the Company, several predecessor operators and several product purchasers were named in a lawsuit filed in the District Court for Lavaca County in Texas by an entity alleging that it owns a working interest in two wells that has not been recognized by the Company or by predecessor operators to which the Company had granted indemnification rights. In dispute is whether ownership rights were transferred through a number of decades-old poorly documented transactions. Based on prior summary judgments, the trial court entered a final judgment in the case in favor of the plaintiffs for approximately $5.3 million, plus post-judgment interest. The Company appealed the trial court’s decision to the applicable state Court of Appeals, and in the fourth quarter of 2017, the Court of Appeals issued its opinion and affirmed the trial court’s summary decision. In the first quarter of 2018, the Company filed a motion for rehearing with the Court of Appeals, which was denied, as expected. The Company filed a petition requesting a review by the Texas Supreme Court, as the Company believes the trial and appellate courts erred in the interpretation of the law. In early October 2019, the Supreme Court notified the Company that it would not hear this case. The Company engaged additional legal representation to assist in the preparation of an amended petition requesting that the Texas Supreme Court reconsider its initial decision to not review the case. That amended petition was filed, and in mid-March 2020, the Texas Supreme Court decided they would not re-hear the case. Consequently, during the three months ended December 31, 2019, the Company recorded a $6.3 million liability for the judgment, interest and fees, with $3.5 million of such liability related to suspended funds reflected in “Accounts payable and accrued liabilities” on the Company’s consolidated balance sheet as of December 31, 2019. The judgment, interest and fees were paid in April 2020. In January 2016, the Company was named as the defendant in a lawsuit filed in the District Court for Harris County in Texas by a third-party operator. The Company participated in the drilling of a well in 2012, which experienced serious difficulties during the initial drilling, which eventually led to the plugging and abandoning of the wellbore prior to reaching the target depth. In dispute is whether the Company is responsible for the additional costs related to the drilling difficulties and plugging and abandonment. In September 2019, the case went to trial, and the court ruled in favor of the plaintiff. Prior to the judgment, the Company had approximately $1.1 million in accounts payable related to the disputed costs associated with this case. As a result of the judgment, during the three months ended September 30, 2019, the Company recorded an additional $2.1 million liability for the final judgment plus fees and interest. The Company has since prepared and filed an appeal with the appellate court for a review of the initial trial court’s decision. The plaintiff has petitioned the appellate court for an extension of time until late in the fourth quarter of 2020 in order to file briefs with the court. The Company is awaiting the court’s response. While many of these matters involve inherent uncertainty and the Company is unable at the date of this filing to estimate an amount of possible loss with respect to certain of these matters, the Company believes that the amount of the liability, if any, ultimately incurred with respect to these proceedings or claims will not have a material adverse effect on its consolidated financial position as a whole or on its liquidity, capital resources or future annual results of operations. The Company maintains various insurance policies that may provide coverage when certain types of legal proceedings are determined adversely. Throughput Contract Commitment The Company signed a throughput agreement with a third-party pipeline owner/operator that constructed a natural gas gathering pipeline in Southeast Texas that allows the Company to defray the cost of building the pipeline itself. Beginning in late 2016, the Company was unable to meet the minimum monthly gas volume deliveries through this line in Southeast Texas and continued to not meet the minimum throughput requirements under the agreement through the expiration of the throughput commitment in March 2020. As of December 31, 2019, the Company recorded a $1.0 million loss contingency through the expiration of the contract on March 31, 2020, which is to be paid in three equal monthly installments beginning in August of 2020.

Summary of Significant Accoun_2

Summary of Significant Accounting Policies (Policies)	6 Months Ended
	Jun. 30, 2020
Summary Of Significant Accounting Policies [Abstract]
Basis of Presentation	Basis of Presentation The accompanying unaudited consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information, pursuant to the rules and regulations of the SEC, including instructions to Quarterly Reports on Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all the information and footnotes required by GAAP for complete annual financial statements. In the opinion of management, all adjustments considered necessary for a fair statement of the unaudited consolidated financial statements have been included. All such adjustments are of a normal recurring nature. The consolidated financial statements should be read in conjunction with the 2019 Form 10-K. These unaudited interim consolidated results of operations for the six months ended June 30, 2020 are not necessarily indicative of the results that may be expected for the full year ending December 31, 2020. The Company’s consolidated financial statements include the accounts of Contango Oil & Gas Company and its subsidiaries after elimination of all material intercompany balances and transactions. All wholly owned subsidiaries are consolidated. The Company’s investment in Exaro, through its wholly owned subsidiary, Contaro Company, is accounted for using the equity method of accounting, and therefore, the Company does not include its share of individual operating results, production or reserves in those reported for the Company’s consolidated results of operations.
Oil and Gas Properties - Successful Efforts	Oil and Gas Properties - Successful Efforts The Company’s application of the successful efforts method of accounting for its oil and natural gas exploration and production activities requires judgment as to whether particular wells are developmental or exploratory, since exploratory costs and the costs related to exploratory wells that are determined to not have proved reserves must be expensed, whereas developmental costs are capitalized. The results from a drilling operation can take considerable time to analyze, and the determination that commercial reserves have been discovered requires both judgment and application of industry experience. Wells may be completed that are assumed to be productive and actually deliver oil and natural gas in quantities insufficient to be economic, which may result in the abandonment of the wells at a later date. On occasion, wells are drilled which have targeted geologic structures that are both developmental and exploratory in nature, and in such instances an allocation of costs is required to properly account for the results. Delineation seismic costs incurred to select development locations within a productive oil or natural gas field are typically treated as development costs and capitalized, but often these seismic programs extend beyond the proved reserve areas, and therefore, management must estimate the portion of seismic costs to expense as exploratory. During the quarter ended June 30, 2020, the Company drilled an unsuccessful exploratory well in the Gulf of Mexico, resulting in a charge of $10.9 million for drilling and prospect costs included in “Exploration expenses” in the Company’s consolidated statements of operations. The evaluation of oil and natural gas leasehold acquisition costs included in unproved properties requires management’s judgment of exploratory costs related to drilling activity in a given area. Drilling activities in an area by other companies may also effectively condemn leasehold positions.
Impairment of Long-Lived Assets	Impairment of Long-Lived Assets Pursuant to GAAP, when circumstances indicate that proved properties may be impaired, the Company compares expected undiscounted future cash flows on a region basis to the unamortized capitalized cost of the asset. If the estimated future undiscounted cash flows based on the Company’s estimate of future reserves, oil and natural gas prices, operating costs and production levels from oil and natural gas reserves, are lower than the unamortized capitalized cost, then the capitalized cost is reduced to fair value. The factors used to determine fair value include, but are not limited to, estimates of proved, probable and possible reserves, future commodity prices, the timing of future production and capital expenditures and a discount rate commensurate with the risk reflective of the lives remaining for the respective oil and gas properties. Additionally, the Company may use appropriate market data to determine fair value. In the first quarter of 2020, the COVID-19 pandemic and the resulting deterioration in the global demand for oil, combined with the failure by OPEC and Russia to reach an agreement on lower production quotas until April 2020, caused a dramatic increase in the supply of oil, a corresponding decrease in commodity prices, and reduced the demand for all commodity products. Consequently, during the three months ended March 31, 2020, the Company recorded a $143.3 million non-cash charge for proved property impairment of its onshore properties related to the dramatic decline in commodity prices, as discussed above, the “PV-10” (present value, discounted at a 10% rate) of its proved reserves, and the associated change in its current development plans for its proved, undeveloped locations. The Company conducted an impairment test for the three months ended June 30, 2020, but no additional impairment was recorded. During the six months ended June 30, 2019, the company recognized $0.2 million in non-cash proved property impairment related to leases in Wyoming and an onshore non-operated property in an area previously impaired due to revised reserve estimates made during the quarter ended December 31, 2018. Unproved properties are reviewed quarterly to determine if there has been impairment of the carrying value of those properties, with any such impairment charged to expense in the period. The Company recorded a $2.6 million non-cash charge for unproved impairment expense during the six months ended June 30, 2020, all of which was recorded during the first quarter of 2020. The impairment primarily related to acquired leases in the Company’s Central Oklahoma and Western Anadarko regions which will be expiring in 2020, and which the Company has no current plans to develop as a result of the current commodity price environment. The Company recognized non-cash impairment expense of approximately $0.4 million and approximately $0.9 million for three and six months ended June 30, 2019, respectively, related to impairment of certain unproved properties primarily due to expiring leases.
Net Loss Per Common Share	Net Loss Per Common Share Basic net loss per common share is computed by dividing the net loss attributable to common stock by the weighted average number of common shares outstanding for the period. Diluted net loss per common share reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock. Potentially dilutive securities, including unexercised stock options, performance stock units and unvested restricted stock, have not been considered when their effect would be antidilutive. The Company excluded 506,325 shares or units, and 414,383 shares or units of potentially dilutive securities during the three and six months ended June 30, 2020, respectively, as they were antidilutive. For the three and six months ended June 30, 2019, the company excluded 648,170 shares or units and 561,164 shares or units, respectively, of potentially dilutive securities, as they were antidilutive.
Subsidiary Guarantees	Subsidiary Guarantees Contango Oil & Gas Company, as the parent company of certain subsidiaries (the “Parent Company”), has filed a registration statement on Form S-3 with the SEC to register, among other securities, debt securities that the Parent Company may issue from time to time. Any such debt securities would likely be guaranteed on a joint and several and full and unconditional basis by each of the Parent Company’s current subsidiaries and any future subsidiaries specified in any future prospectus supplement (each a “Subsidiary Guarantor”). Each of the current Subsidiary Guarantors is wholly owned by the Parent Company, either directly or indirectly. The Parent Company has no assets or operations independent of the Subsidiary Guarantors, and there are no significant restrictions upon the ability of the Subsidiary Guarantors to distribute funds to the Parent Company. The Parent Company’s wholly owned subsidiaries do not have restricted assets that exceed 25% of net assets as of the most recent fiscal year end that may not be transferred to the Parent Company in the form of loans, advances or cash dividends by such subsidiary without the consent of a third party.
Revenue Recognition	Revenue Recognition Sales of oil, condensate, natural gas and natural gas liquids (“NGLs”) are recognized at the time control of the products are transferred to the customer. Generally, the Company’s gas processing and purchase agreements indicate that the processors take control of the Company’s gas at the inlet of the plant and that control of residue gas is returned to the Company at the outlet of the plant. The midstream processing entity gathers and processes the natural gas and remits proceeds to the Company for the resulting sales of NGLs. The Company delivers oil and condensate to the purchaser at a contractually agreed-upon delivery point at which the purchaser takes custody, title and risk of loss of the product. Generally, the Company’s contracts have an initial term of one year or longer but continue month to month unless written notification of termination in a specified time period is provided by either party to the contract. The Company receives purchaser statements from the majority of its customers, but there are a few contracts where the Company prepares the invoice. Payment is unconditional upon receipt of the statement or invoice. The Company records revenue in the month production is delivered to the purchaser. Settlement statements may not be received for 30 to 90 days after the date production is delivered, and therefore the Company is required to estimate the amount of production delivered to the purchaser and the price that will be received for the sale of the product. Differences between the Company’s estimates and the actual amounts received for product sales are generally recorded in the month that payment is received. Any differences between the Company’s revenue estimates and actual revenue received historically have not been significant. The Company has internal controls in place for its revenue estimation accrual process. The Company will continue to review all new or modified revenue contracts on a quarterly basis for proper treatment.
Leases	Leases The Company recognizes a lease liability, which is a lessee’s obligation to make lease payments arising from a lease, measured on a discounted basis; and a right-of-use asset, which is an asset that represents the lessee’s right to use, or control the use of, a specified asset for the lease term on the Company’s consolidated balance sheet. The Company does not include leases with an initial term of twelve months or less on the balance sheet. The Company recognizes payments on these leases within “Operating expenses” on its consolidated statement of operations. The Company has modified procedures to its existing internal controls to review any new contracts which contain a physical asset on a quarterly basis and determine if an arrangement is, or contains, a lease at inception. The Company will continue to review all new or modified contracts on a quarterly basis for proper treatment. See Note 7 – “Leases” for additional information.
Recent Accounting Pronouncements	Recent Accounting Pronouncements In June 2016, the FASB issued ASU 2016-13 – Financial Instruments – Credit Losses (“Topic 326”): Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”) related to the calculation of credit losses on financial instruments. All financial instruments not accounted for at fair value will be impacted, including the Company’s trade and joint interest billing receivables. Allowances are to be measured using a current expected credit loss model as of the reporting date that is based on historical experience, current conditions and reasonable and supportable forecasts. This is significantly different from the current model that increases the allowance when losses are probable. Initially, ASU 2016-13 was effective for all public companies for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years, and will be applied with a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which the guidance is effective. The FASB subsequently issued ASU 2019-04 (“ASU 2019-04”): Codification Improvements to Topic 326, Financial Instruments – Credit Losses, Topic 815, Derivatives, and Topic 825, Financial Instruments and ASU 2019-05 (“ASU 2019-05”): Financial Instruments-Credit Losses (Topic 326) – Targeted Transition Relief. ASU 2019-04 and ASU 2019-05 provide certain codification improvements related to implementation of ASU 2016-13 and targeted transition relief consisting of an option to irrevocably elect the fair value option for eligible instruments. In November 2019, the FASB issued ASU 2019-10 – Financial Instruments – Credit Losses (Topic 326), Derivatives and Hedging (Topic 815), and Leases (Topic 842): Effective Dates. This amendment deferred the effective date of ASU 2016-13 from January 1, 2020 to January 1, 2023 for calendar year-end smaller reporting companies, which includes the Company. The Company plans to defer the implementation of ASU 2016-13, and the related updates. In November 2019, the FASB issued ASU 2019-12 – Income Taxes (“Topic 740”): Simplifying the Accounting for Income Taxes. The amendments in ASU 2019-12 are part of an initiative to reduce complexity in accounting standards and simplify the accounting for income taxes by removing certain exceptions from Topic 740 and making minor improvements to the codification. The amendments in this update are effective for public entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020. The provisions of this update are not expected to have a material impact on the Company’s financial position or results of operations. In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting (“ASU 2020-04”). ASU 2020-04 provides optional expedients and exceptions for applying GAAP to contract modifications and hedging relationships, subject to meeting certain criteria, that reference LIBOR or another rate that is expected to be discontinued. ASU 2020-04 will be in effect through December 31, 2022. We are currently assessing the potential impact of ASU 2020-04 on our consolidated financial statements

Fair Value Measurements (Tables

Fair Value Measurements (Tables)	6 Months Ended
	Jun. 30, 2020
Fair Value Measurements
Schedule Of Fair Value Of Financial Assets And (Liabilities)	Fair value information for financial assets and liabilities was as follows as of June 30, 2020 (in thousands): Total Fair Value Measurements Using Carrying Value Level 1 Level 2 Level 3 Derivatives Commodity price contracts - assets $ 21,221 $ — $ 21,221 $ — Commodity price contracts - liabilities $ (1,825) $ — $ (1,825) $ —

Derivative Instruments (Tables)

Derivative Instruments (Tables)	6 Months Ended
	Jun. 30, 2020
Derivative Instruments [Abstract]
Schedule Of Derivative Contracts	As of June 30, 2020, the following financial derivative instruments were in place (fair value in thousands): Commodity Period Derivative Volume/Month Price/Unit Fair Value Oil July 2020 - Oct 2020 Collar 3,442 Bbls $ - (1) $ Oil July 2020 - Dec 2020 Swap 15,000 Bbls $ 57.74 (1) $ Oil July 2020 Swap 5,500 Bbls $ 54.33 (1) $ Oil Aug 2020 - Oct 2020 Swap 2,500 Bbls $ 54.33 (1) $ Oil Nov 2020 - Dec 2020 Swap 3,500 Bbls $ 54.33 (1) $ Oil July 2020 Swap 37,500 Bbls $ 54.70 (1) $ Oil Aug 2020 - Dec 2020 Swap 35,000 Bbls $ 54.70 (1) $ Oil July 2020 Swap 37,500 Bbls $ 54.58 (1) $ Oil Aug 2020 - Dec 2020 Swap 35,000 Bbls $ 54.58 (1) $ Oil Jan 2021 - March 2021 Swap 19,000 Bbls $ 50.00 (1) $ Oil April 2021 - July 2021 Swap 12,000 Bbls $ 50.00 (1) $ Oil Aug 2021 - Sept 2021 Swap 10,000 Bbls $ 50.00 (1) $ Oil Jan 2021 - July 2021 Swap 62,000 Bbls $ 52.00 (1) $ Oil Aug 2021 - Sept 2021 Swap 55,000 Bbls $ 52.00 (1) $ Oil Oct 2021 - Dec 2021 Swap 64,000 Bbls $ 52.00 (1) $ Natural Gas Aug 2020 - Oct 2020 Swap 40,000 Mmbtus $ 2.532 (2) $ Natural Gas Nov 2020 - Dec 2020 Swap 375,000 Mmbtus $ 2.696 (2) $ Natural Gas July 2020 Swap 400,000 Mmbtus $ 2.53 (2) $ Natural Gas Aug 2020 - Dec 2020 Swap 350,000 Mmbtus $ 2.53 (2) $ Natural Gas July 2020 Swap 400,000 Mmbtus $ 2.532 (2) $ Natural Gas Aug 2020 - Dec 2020 Swap 350,000 Mmbtus $ 2.532 (2) $ Natural Gas Jan 2021 - March 2021 Swap 185,000 Mmbtus $ 2.505 (2) $ Natural Gas April 2021 - July 2021 Swap 120,000 Mmbtus $ 2.505 (2) $ Natural Gas Aug 2021 - Sept 2021 Swap 10,000 Mmbtus $ 2.505 (2) $ Natural Gas Jan 2021 - March 2021 Swap 185,000 Mmbtus $ 2.508 (2) $ Natural Gas April 2021 - July 2021 Swap 120,000 Mmbtus $ 2.508 (2) $ Natural Gas Aug 2021 - Sept 2021 Swap 10,000 Mmbtus $ 2.508 (2) $ Natural Gas Jan 2021 - March 2021 Swap 650,000 Mmbtus $ 2.508 (1) $ Natural Gas April 2021 - Oct 2021 Swap 400,000 Mmbtus $ 2.508 (1) $ Natural Gas Nov 2021 - Dec 2021 Swap 580,000 Mmbtus $ 2.508 (2) $ Natural Gas April 2021 - Nov 2021 Swap 70,000 Mmbtus $ 2.36 (2) $ Natural Gas Dec 2021 Swap 350,000 Mmbtus $ 2.36 (2) $ Natural Gas Jan 2022 - March 2022 Swap 780,000 Mmbtus $ 2.542 (2) $ Total net fair value of derivative instruments $ 19,396 (1) Based on West Texas Intermediate oil prices. (2) Based on Henry Hub NYMEX natural gas prices.
Schedule Of Fair Value Of Commodity Derivatives	The following summarizes the fair value of commodity derivatives outstanding on a gross and net basis as of June 30, 2020 (in thousands): Gross Netting (1) Total Assets $ 21,221 $ — $ 21,221 Liabilities $ (1,825) $ — $ (1,825) (1) Represents counterparty netting under agreements governing such derivatives. The following summarizes the fair value of commodity derivatives outstanding on a gross and net basis as of December 31, 2019 (in thousands): Gross Netting (1) Total Assets $ 4,176 $ — $ 4,176 Liabilities $ (5,971) $ — $ (5,971) (1) Represents counterparty netting under agreements governing such derivatives.
Schedule Of Derivative Contracts On Operations	The following table summarizes the effect of derivative contracts on the consolidated statements of operations for the three and six months ended June 30, 2020 and 2019 (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2020 2019 2020 2019 Oil contracts $ 8,461 $ 286 $ 11,258 $ 941 Natural gas contracts 2,933 211 5,445 324 Realized gain $ 11,394 $ 497 $ 16,703 $ 1,265 Oil contracts $ (16,557) $ 365 $ 24,170 $ (3,077) Natural gas contracts (3,641) 1,203 (2,978) 999 Unrealized gain (loss) $ (20,198) $ 1,568 $ 21,192 $ (2,078) Gain (loss) on derivatives, net $ (8,804) $ 2,065 $ 37,895 $ (813)

Leases (Tables)

Leases (Tables)	6 Months Ended
	Jun. 30, 2020
Leases
Summary of balance sheet information related to the leases	The following table summarizes the balance sheet information related to the Company’s leases as of June 30, 2020 and December 31, 2019 (in thousands): June 30, 2020 December 31, 2019 Operating lease right of use asset (1) $ 3,993 $ 4,316 Operating lease liability - current (2) $ (2,897) $ (2,597) Operating lease liability - long-term (3) (1,045) (1,738) Total operating lease liability $ (3,942) $ (4,335) Financing lease right of use asset (1) $ 1,698 $ 1,569 Financing lease liability - current (2) $ (605) $ (524) Financing lease liability - long-term (3) (1,111) (1,051) Total financing lease liability $ (1,716) $ (1,575) (1) Included in “Right-of-use lease assets” on the consolidated balance sheet. (2) Included in “Accounts payable and accrued liabilities” on the consolidated balance sheet. (3) Included in “Lease liabilities” on the consolidated balance sheet.
Summary of weighted average remaining lease terms and weighted average discount rates	The table below presents the weighted average remaining lease terms and weighted average discount rates for the Company’s leases as of June 30, 2020 and December 31, 2019: June 30, 2020 December 31, 2019 Weighted Average Remaining Lease Terms (in years): Operating leases Financing leases Weighted Average Discount Rate: Operating leases Financing leases
Summary of operating lease maturities	Maturities for the Company’s lease liabilities on the consolidated balance sheet as of June 30, 2020, were as follows (in thousands): June 30, 2020 Operating Leases Financing Leases 2020 (remaining after June 30, 2020) $ 3,040 $ 690 2021 702 552 2022 168 475 2023 171 156 2024 72 7 Total future minimum lease payments 4,153 1,880 Less: imputed interest (211) (164) Present value of lease liabilities $ 3,942 $ 1,716
Summary of finance lease maturities	June 30, 2020 Operating Leases Financing Leases 2020 (remaining after June 30, 2020) $ 3,040 $ 690 2021 702 552 2022 168 475 2023 171 156 2024 72 7 Total future minimum lease payments 4,153 1,880 Less: imputed interest (211) (164) Present value of lease liabilities $ 3,942 $ 1,716
Summary of lease costs	Three Months Ended June 30, 2020 Three Months Ended June 30, 2019 Operating lease cost (1) (2) $ 743 $ 100 Financing lease cost - amortization of right-of-use assets 155 - Financing lease cost - interest on lease liabilities 27 - Administrative lease cost (3) 19 18 Short-term lease cost (1) (4) 615 2,068 Total lease cost $ 1,559 $ 2,186 (1) This total does not reflect amounts that may be reimbursed by other third parties in the normal course of business, such as non-operating working interest owners. (2) Costs related to office leases and compressors with lease terms of twelve months or more. (3) Costs related primarily to office equipment and IT solutions with lease terms of more than one month and less than one year. (4) Costs related primarily to drilling rigs, generators and compressor agreements with lease terms of more than one month and less than one year. The following table summarizes expenses related to the Company’s leases for the six months ended June 30, 2020 and 2019 (in thousands): Six Months Ended June 30, 2020 Six Months Ended June 30, 2019 Operating lease cost (1) (2) $ 1,430 $ 471 Financing lease cost - amortization of right-of-use assets 284 - Financing lease cost - interest on lease liabilities 52 - Administrative lease cost (3) 38 37 Short-term lease cost (1) (4) 1,053 2,578 Total lease cost $ 2,857 $ 3,086 (1) This total does not reflect amounts that may be reimbursed by other third parties in the normal course of business, such as non-operating working interest owners. (2) Costs related to office leases and compressors with lease terms of twelve months or more. (3) Costs related primarily to office equipment and IT solutions with lease terms of more than one month and less than one year. (4) Costs related primarily to drilling rigs, generators and compressor agreements with lease terms of more than one month and less than one year.

Other Financial Information (Ta

Other Financial Information (Tables)	6 Months Ended
	Jun. 30, 2020
Other Financial Information [Abstract]
Schedule Of Additional Financial Details	The following table provides additional detail for accounts receivable, prepaid expenses, inventory and accounts payable and accrued liabilities which are presented on the consolidated balance sheets (in thousands): June 30, 2020 December 31, 2019 Accounts receivable: Trade receivables (1) $ 9,527 $ 21,110 Receivable for Alta Resources distribution 1,712 1,712 Joint interest billings 12,220 13,104 Income taxes receivable 268 509 Other receivables 2,939 4,126 Allowance for doubtful accounts (994) (994) Total accounts receivable $ 25,672 $ 39,567 Prepaid expenses: Prepaid insurance $ 335 $ 683 Other (2) 1,028 508 Total prepaid expenses $ 1,363 $ 1,191 Inventory: Oil storage (3) $ 947 $ — Materials and supplies 763 186 Total inventory $ 1,710 $ 186 Accounts payable and accrued liabilities: Royalties and revenue payable $ 39,950 $ 49,644 Advances from partners (4) 868 6,733 Accrued exploration and development (4) 1,463 8,210 Trade payables 15,192 14,086 Accrued general and administrative expenses (5) 5,739 12,037 Accrued operating expenses 8,881 5,794 Accrued operating and finance leases 3,502 3,120 Other accounts payable and accrued liabilities 1,548 4,969 Total accounts payable and accrued liabilities $ 77,143 $ 104,593 (1) Decrease in 2020 primarily due to lower receivables from oil sales as a result of the dramatic decline in oil prices in 2020. (2) Other prepaids primarily includes software licenses and additional licenses purchased in relation to the properties acquired from Will Energy and White Star. (3) Includes approximately 50,000 Bbls of oil (net to the Company) produced during the three months ended June 30, 2020, held as inventory in the Company’s Central Oklahoma region and sold in the third quarter of 2020. (4) Decrease in 2020 due to a decrease in drilling and completion activity. In January 2020, the Company brought one West Texas well online but suspended further drilling in the area, and in its other onshore areas, in response to the dramatic decline in oil prices during the year. (5) Includes accruals for legal judgments, of which $6.3 million was paid in April 2020. See Note 12 – “Commitment and Contingencies” for further information.
Schedule Of Supplemental Disclosures	Six Months Ended June 30, 2020 2019 Cash payments: Interest payments $ 2,006 $ 2,157 Income tax payments $ 83 $ 805 Non-cash investing activities in the consolidated statements of cash flows: Increase (decrease) in accrued capital expenditures $ (7,095) $ 475

Income Taxes (Tables)

Income Taxes (Tables)	6 Months Ended
	Jun. 30, 2020
Income Taxes [Abstract]
Components Of Income Tax Provision	Three Months Ended June 30, Six Months Ended June 30, 2020 2019 2020 2019 Current tax provision: Federal $ — $ — $ 275 $ — State (7) 427 112 454 Total $ (7) $ 427 $ 387 $ 454 Deferred tax provision: Federal $ — $ — $ — $ — State 376 — 376 — Total $ 376 $ — $ 376 $ — Total tax provision: Federal $ — $ — $ 275 $ — State 369 427 488 454 Total income tax provision: $ 369 $ 427 $ 763 $ 454

Organization and Business (Deta

Organization and Business (Details)	Jun. 24, 2020USD ($)shares	Jun. 10, 2020$ / sharesshares	Jun. 30, 2020a$ / sharesshares	Jun. 30, 2020USD ($)aitemft$ / sharesshares	Jun. 09, 2020shares	Jun. 05, 2020USD ($)	Dec. 31, 2019$ / sharesshares
Acquired properties percentage of total production			70.00%	70.00%
Property management annual revenue | $						$ 4,000,000
Deferred fees, monthly | $						166,666
Deferred fee, annual | $						$ 2,000,000
Common stock, par value (in dollars per share) | $ / shares		$ 0.04	$ 0.04	$ 0.04			$ 0.04
Common stock, shares authorized		400,000,000	400,000,000	400,000,000	200,000,000		400,000,000
Preferred stock, par value (in dollars per share) | $ / shares		$ 0.04	$ 0.04	$ 0.04			$ 0.04
Equity offering-common stock, shares	155,029
Net proceeds from equity offering | $	$ 500,000			$ 435,000
Maximum [Member]
Net proceeds from equity offering | $	$ 100,000,000
Exaro Energy III LLC [Member]
Equity method investment, ownership percentage			37.00%	37.00%
Bullseye
Number of wells | item				18
Gross acres | a			16,200	16,200
Net acres | a			7,500	7,500
John C Goff [Member] | Mid-Con [Member]
Equity method investment, ownership percentage						56.00%
Preferred Stock [Member]
Stock converted (in shares)		2,700,000
Conversion of preferred stock to common stock, shares			(2,700,000)
Common Stock [Member]
Conversion of preferred stock to common stock, shares		2,700,000	2,700,000
Equity offering-common stock, shares			155,029
Gulf of Mexico [Member] | Maximum [Member]
Water depth of operations | ft				300

Summary of Significant Accoun_3

Summary of Significant Accounting Policies (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Policies
Impairment of oil and natural gas properties			$ 145,878	$ 1,079
Potentially dilutive (in shares)	506,325	648,170	414,383	561,164
Restricted assets, percent of net assets	25.00%		25.00%
Term of contract			1 year
Minimum [Member]
Policies
Period settlement statements are received			30 days
Maximum [Member]
Policies
Period settlement statements are received			90 days
Gulf of Mexico Properties [Member]
Policies
Dry hole costs	$ 10,900
Proved property [Member]
Policies
Impairment of oil and natural gas properties			$ 143,300	$ 200
Unproved property [Member]
Policies
Impairment of oil and natural gas properties		$ 400	$ 2,600	$ 900

Dispositions - Dispositions (De

Dispositions - Dispositions (Details) - USD ($) $ in Thousands	Jun. 01, 2020	Apr. 01, 2020	Jun. 10, 2019	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Disposals
Proceeds from sale						$ 339
Gain (loss) from sale of assets				$ 4,406	$ 421	$ 4,433	$ 409
Disposal Group, Disposed of by Sale, Not Discontinued Operations [Member]
Disposals
Proceeds from sale		$ 500
Gain (loss) from sale of assets	$ 4,200	$ 200	$ 400

Fair Value Measurements (Detail

Fair Value Measurements (Details) - USD ($) $ in Thousands	Jun. 30, 2020	Dec. 31, 2019
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Commodity price contracts - assets	$ 21,221	$ 4,176
Commodity price contracts - liabilities	(1,825)	$ (5,971)
Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Commodity price contracts - assets	21,221
Commodity price contracts - liabilities	$ (1,825)

Derivative Instruments - Deriva

Derivative Instruments - Derivative Contracts (Details) $ in Thousands	Jun. 30, 2020USD ($)item$ / bbl$ / item
Derivative [Line Items]
Fair Value	$ 19,396
Natural Gas [Member] | Swap [Member] | Derivative Contract Period July 2020 [Member]
Derivative [Line Items]
Commodity Derivative Flow Rate | item	400,000
Price/Unit-Swap | $ / item	2.53
Fair Value	$ 828
Natural Gas [Member] | Swap [Member] | Derivative Contract Period July 2020 [Member]
Derivative [Line Items]
Commodity Derivative Flow Rate | item	400,000
Price/Unit-Swap | $ / item	2.532
Fair Value	$ 415
Natural Gas [Member] | Swap [Member] | Derivative Contract Period August to October 2020 [Member]
Derivative [Line Items]
Commodity Derivative Flow Rate | item	40,000
Price/Unit-Swap | $ / item	2.532
Fair Value	$ 87
Natural Gas [Member] | Swap [Member] | Derivative Contract Period August to December 2020 [Member]
Derivative [Line Items]
Commodity Derivative Flow Rate | item	350,000
Price/Unit-Swap | $ / item	2.53
Fair Value	$ 768
Natural Gas [Member] | Swap [Member] | Derivative Contract 2 Period August to December 2020 [Member]
Derivative [Line Items]
Commodity Derivative Flow Rate | item	350,000
Price/Unit-Swap | $ / item	2.532
Fair Value	$ 770
Natural Gas [Member] | Swap [Member] | Derivative Contract Period November to December 2020 [Member]
Derivative [Line Items]
Commodity Derivative Flow Rate | item	375,000
Price/Unit-Swap | $ / item	2.696
Fair Value	$ 136
Natural Gas [Member] | Swap [Member] | Derivative Contract Period January to March 2021 [Member]
Derivative [Line Items]
Commodity Derivative Flow Rate | item	185,000
Price/Unit-Swap | $ / item	2.505
Fair Value	$ (176)
Natural Gas [Member] | Swap [Member] | Derivative Contract 2 Period January to March 2021 [Member]
Derivative [Line Items]
Commodity Derivative Flow Rate | item	185,000
Price/Unit-Swap | $ / item	2.508
Fair Value	$ (174)
Natural Gas [Member] | Swap [Member] | Derivative Contract 3 Period January To March 2021 [Member]
Derivative [Line Items]
Commodity Derivative Flow Rate | item	650,000
Price/Unit-Swap | $ / item	2.508
Fair Value	$ (612)
Natural Gas [Member] | Swap [Member] | Derivative Contract Period April to July 2021 [Member]
Derivative [Line Items]
Commodity Derivative Flow Rate | item	120,000
Price/Unit-Swap | $ / item	2.505
Fair Value	$ 11
Natural Gas [Member] | Swap [Member] | Derivative Contract 2 Period April to July 2021 [Member]
Derivative [Line Items]
Commodity Derivative Flow Rate | item	120,000
Price/Unit-Swap | $ / item	2.508
Fair Value	$ 13
Natural Gas [Member] | Swap [Member] | Derivative Contract Period April to October 2021 [Member]
Derivative [Line Items]
Commodity Derivative Flow Rate | item	400,000
Price/Unit-Swap | $ / item	2.508
Fair Value	$ 4
Natural Gas [Member] | Swap [Member] | Derivative Contract Period April to November 2021 [Member]
Derivative [Line Items]
Commodity Derivative Flow Rate | item	70,000
Price/Unit-Swap | $ / item	2.36
Fair Value	$ (92)
Natural Gas [Member] | Swap [Member] | Derivative Contract Period August to September 2021 [Member]
Derivative [Line Items]
Commodity Derivative Flow Rate | item	10,000
Price/Unit-Swap | $ / item	2.505
Fair Value	$ (1)
Natural Gas [Member] | Swap [Member] | Derivative Contract 2 Period August to September 2021 [Member]
Derivative [Line Items]
Commodity Derivative Flow Rate | item	10,000
Price/Unit-Swap | $ / item	2.508
Fair Value	$ (1)
Natural Gas [Member] | Swap [Member] | Derivative Contract Period November to December 2021 [Member]
Derivative [Line Items]
Commodity Derivative Flow Rate | item	580,000
Price/Unit-Swap | $ / item	2.508
Fair Value	$ (178)
Natural Gas [Member] | Swap [Member] | Derivative Contract Period December 2021 [Member]
Derivative [Line Items]
Commodity Derivative Flow Rate | item	350,000
Price/Unit-Swap | $ / item	2.36
Fair Value	$ (130)
Natural Gas [Member] | Swap [Member] | Derivative Contract Period January to March 2022 [Member]
Derivative [Line Items]
Commodity Derivative Flow Rate | item	780,000
Price/Unit-Swap | $ / item	2.542
Fair Value	$ (489)
Oil [Member] | Collar Options [Member] | Derivative Contract Period July to October 2020 [Member]
Derivative [Line Items]
Commodity Derivative Flow Rate | item	3,442
Price/Unit-Floor | $ / item	52
Price/Unit-Cap | $ / item	65.70
Fair Value	$ 176
Oil [Member] | Swap [Member] | Derivative Contract Period July 2020 [Member]
Derivative [Line Items]
Commodity Derivative Flow Rate | item	5,500
Price/Unit-Swap | $ / item	54.33
Fair Value	$ 83
Oil [Member] | Swap [Member] | Derivative Contract Period July 2020 [Member]
Derivative [Line Items]
Commodity Derivative Flow Rate | item	37,500
Price/Unit-Swap | $ / item	54.70
Fair Value	$ 576
Oil [Member] | Swap [Member] | Derivative Contract Period July 2020 [Member]
Derivative [Line Items]
Commodity Derivative Flow Rate | item	37,500
Price/Unit-Swap | $ / item	54.58
Fair Value	$ 573
Oil [Member] | Swap [Member] | Derivative Contract Period July to December 2020 [Member]
Derivative [Line Items]
Commodity Derivative Flow Rate | item	15,000
Price/Unit-Swap | $ / item	57.74
Fair Value	$ 1,635
Oil [Member] | Swap [Member] | Derivative Contract Period August to October 2020 [Member]
Derivative [Line Items]
Commodity Derivative Flow Rate | item	2,500
Price/Unit-Swap | $ / item	54.33
Fair Value	$ 111
Oil [Member] | Swap [Member] | Derivative Contract Period August to December 2020 [Member]
Derivative [Line Items]
Commodity Derivative Flow Rate | item	35,000
Price/Unit-Swap | $ / item	54.70
Fair Value	$ 2,637
Oil [Member] | Swap [Member] | Derivative Contract 2 Period August to December 2020 [Member]
Derivative [Line Items]
Commodity Derivative Flow Rate | item	35,000
Price/Unit-Swap | $ / item	54.58
Fair Value	$ 2,617
Oil [Member] | Swap [Member] | Derivative Contract Period November to December 2020 [Member]
Derivative [Line Items]
Commodity Derivative Flow Rate | item	3,500
Price/Unit-Swap | $ / item	54.33
Fair Value	$ 102
Oil [Member] | Swap [Member] | Derivative Contract Period January to March 2021 [Member]
Derivative [Line Items]
Commodity Derivative Flow Rate | item	19,000
Price/Unit-Swap | $ / item	50
Fair Value	$ 568
Oil [Member] | Swap [Member] | Derivative Contract Period January to July 2021 [Member]
Derivative [Line Items]
Commodity Derivative Flow Rate | item	62,000
Price/Unit-Swap | $ / item	52
Fair Value	$ 5,106
Oil [Member] | Swap [Member] | Derivative Contract Period April to July 2021 [Member]
Derivative [Line Items]
Commodity Derivative Flow Rate | item	12,000
Price/Unit-Swap | $ / item	50
Fair Value	$ 462
Oil [Member] | Swap [Member] | Derivative Contract Period August to September 2021 [Member]
Derivative [Line Items]
Commodity Derivative Flow Rate | item	10,000
Price/Unit-Swap | $ / item	50
Fair Value	$ 187
Oil [Member] | Swap [Member] | Derivative Contract 2 Period August to September 2021 [Member]
Derivative [Line Items]
Commodity Derivative Flow Rate | item	55,000
Price/Unit-Swap | $ / item	52
Fair Value	$ 1,248
Oil [Member] | Swap [Member] | Derivative Contract Period October to December 2021 [Member]
Derivative [Line Items]
Commodity Derivative Flow Rate | item	64,000
Price/Unit-Swap | $ / item	52
Fair Value	$ 2,136
Oil [Member] | Costless Swap [Member] | Derivative Contract Period July to December 2020 [Member]
Derivative [Line Items]
Commodity Derivative Flow Rate | item	10,000
Price/Unit-Swap | $ / bbl	0.05
Fair Value	$ 0

Derivative Instruments - Fair V

Derivative Instruments - Fair Value (Details) - USD ($) $ in Thousands	Jun. 30, 2020	Dec. 31, 2019
Assets
Gross	$ 21,221	$ 4,176
Total	21,221	4,176
Liabilities:
Gross	(1,825)	(5,971)
Total	$ (1,825)	$ (5,971)

Derivative Instruments (Operati

Derivative Instruments (Operations) (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Derivative Instruments, Gain (Loss) [Line Items]
Realized gain (loss)	$ 11,394	$ 497	$ 16,703	$ 1,265
Unrealized gain (loss)	(20,198)	1,568	21,192	(2,078)
Gain (loss) on derivatives, net	(8,804)	2,065	37,895	(813)
Oil [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Realized gain (loss)	8,461	286	11,258	941
Unrealized gain (loss)	(16,557)	365	24,170	(3,077)
Natural Gas [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Realized gain (loss)	2,933	211	5,445	324
Unrealized gain (loss)	$ (3,641)	$ 1,203	$ (2,978)	$ 999

Stock Based Compensation (NonOp

Stock Based Compensation (NonOption) (Details) $ / shares in Units, $ in Thousands	Jun. 08, 2020shares	Jul. 31, 2020USD ($)$ / sharesshares	Jan. 31, 2020shares	Jun. 30, 2020USD ($)$ / sharesshares	Jun. 30, 2019USD ($)$ / sharesshares	Jun. 07, 2020shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Common stock authorized for grants increase (in shares)	9,000,000
Shares available for grant	1,000,000			10,100,000		250,000
Restricted Stock [Member]
Activity, shares
Granted (in shares)		1,037,969		152,248	307,650
Canceled/Forfeited (in shares)				(2,539)	(38,161)
Activity, weighted average fair value
Granted (in dollars per share) | $ / shares		$ 2.24		$ 2.42	$ 2.91
Stock-based compensation
Vesting period		3 years		1 year	3 years
Value of issued stock | $		$ 2,300		$ 400	$ 1,100
Weighted average forfeiture rate		0		0	0
Stock-based compensation expense | $				$ 400	$ 1,400
Compensation expense not yet recognized | $				$ 800
Compensation expense, remaining weighted average vesting period				1 year 3 months 18 days
Value of restricted shares forfeited | $				$ 10	$ 200
Performance Stock Units [Member]
Activity, shares
Granted (in shares)		2,608,640		0	117,105
Vested (in shares)			(77,485)
Canceled/Forfeited (in shares)				0	(49,773)
Activity, weighted average fair value
Granted (in dollars per share) | $ / shares		$ 4.90			$ 6.42
Stock-based compensation
Vesting period				3 years
Stock-based compensation expense | $				$ 200	$ 300
Compensation expense not yet recognized | $				$ 500
Compensation expense, remaining weighted average vesting period				1 year 4 months 24 days
Target (as a percent)				100.00%
Withheld for taxes (in shares)			22,972
Board of Directors [Member] | Restricted Stock [Member]
Activity, shares
Granted (in shares)					80,410
Stock-based compensation
Vesting period					1 year
Minimum [Member] | Performance Stock Units [Member]
Stock-based compensation
Target (as a percent)				0.00%
Maximum [Member] | Performance Stock Units [Member]
Stock-based compensation
Target (as a percent)				300.00%

Stock Based Compensation (Optio

Stock Based Compensation (Options) (Details) - Employee Stock Options [Member] - USD ($)	6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019
Option roll forward
Exercise of stock options, shares	0	0
Expired / Forfeited (in shares)	(411)	(12,052)
Stock options granted in period (in shares)	0	0
Stock-based compensation
Excess tax benefit from exercise/cancellation of stock options	$ 0	$ 0

Leases - Balance sheet (Details

Leases - Balance sheet (Details) - USD ($) $ in Thousands	Jun. 30, 2020	Dec. 31, 2019
Balance sheet information
Operating lease right of use asset	$ 3,993	$ 4,316
Operating Lease, Right-of-Use Asset, Statement of Financial Position [Extensible List]	mcf:OperatingAndFinanceLeaseRightOfUseAsset
Operating lease liability - current	$ (2,897)	(2,597)
Operating Lease, Liability, Current, Statement of Financial Position [Extensible List]	us-gaap:AccountsPayableAndAccruedLiabilitiesCurrent
Operating lease liability - long-term	$ (1,045)	(1,738)
Operating Lease, Liability, Noncurrent, Statement of Financial Position [Extensible List]	mcf:OperatingAndFinanceLeaseLiabilityNoncurrent
Total operating lease liability	$ (3,942)	(4,335)
Financing lease right of use asset	$ 1,698	1,569
Finance Lease, Right-of-Use Asset, Statement of Financial Position [Extensible List]	mcf:OperatingAndFinanceLeaseRightOfUseAsset
Financing lease liability - current	$ (605)	(524)
Finance Lease, Liability, Current, Statement of Financial Position [Extensible List]	us-gaap:AccountsPayableAndAccruedLiabilitiesCurrent
Financing lease liability - long-term	$ (1,111)	(1,051)
Finance Lease, Liability, Noncurrent, Statement of Financial Position [Extensible List]	mcf:OperatingAndFinanceLeaseLiabilityNoncurrent
Total financing lease liability	$ (1,716)	$ (1,575)

Leases - Lease Terms and Discou

Leases - Lease Terms and Discount (Details)	Jun. 30, 2020	Dec. 31, 2019
Leases
Weighted Average Remaining Lease Terms (in years): Operating leases	1 year 9 months 22 days	2 years 1 month 28 days
Weighted Average Remaining Lease Terms (in years): Financing leases	3 years 1 month 21 days	3 years 1 month 21 days
Weighted Average Discount Rate: Operating leases	5.75%	6.04%
Weighted Average Discount Rate: Financing leases	5.90%	6.24%

Leases - Future Maturities (Det

Leases - Future Maturities (Details) - USD ($) $ in Thousands	Jun. 30, 2020	Dec. 31, 2019
Operating lease maturities
2020 (remaining after June 30, 2020)	$ 3,040
2021	702
2022	168
2023	171
2024	72
Total operating lease liability	4,153
Less: imputed interest	(211)
Present value of lease liabilities	3,942	$ 4,335
Finance lease maturities
2020 (remaining after June 30, 2020)	690
2021	552
2022	475
2023	156
2024	7
Total financing lease liability	1,880
Less: imputed interest	(164)
Present value of lease liabilities	$ 1,716	$ 1,575

Leases - Costs (Details)

Leases - Costs (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Leases
Operating lease cost	$ 743	$ 100	$ 1,430	$ 471
Financing lease cost - amortization of right-of-use assets	155		284
Financing lease cost - interest on lease liabilities	27		52
Administrative lease cost	19	18	38	37
Short-term lease cost	615	2,068	1,053	2,578
Total lease cost	$ 1,559	$ 2,186	2,857	3,086
Cash payments relating to operating leases			1,500	100
Cash payments relating to finance leases			$ 300	$ 0

Other Financial Information (Ba

Other Financial Information (Balance Sheet) (Details) $ in Thousands	1 Months Ended	3 Months Ended
	Apr. 30, 2020USD ($)	Jun. 30, 2020USD ($)bbl	Dec. 31, 2019USD ($)
Accounts receivable:
Trade receivables		$ 9,527	$ 21,110
Receivable for Alta Resources distribution		1,712	1,712
Joint interest billings		12,220	13,104
Income taxes receivable		268	509
Other receivables		2,939	4,126
Allowance for doubtful accounts		(994)	(994)
Total accounts receivable		25,672	39,567
Prepaid expenses
Prepaid insurance		335	683
Other		1,028	508
Total prepaid expenses		1,363	1,191
Inventory
Oil storage		947
Materials and supplies		763	186
Total inventory		$ 1,710	186
Oil storage volume of units | bbl		50,000
Accounts payable and accrued liabilities:
Royalties and revenue payable		$ 39,950	49,644
Advances from partners		868	6,733
Accrued exploration and development		1,463	8,210
Trade payables		15,192	14,086
Accrued general and administrative expenses		5,739	12,037
Accrued operating expenses		8,881	5,794
Accrued operating and finance leases		3,502	3,120
Other accounts payable and accrued liabilities		1,548	4,969
Total accounts payable and accrued liabilities		$ 77,143	$ 104,593
Loss contingent payment	$ 6,300

Other Financial Information (Su

Other Financial Information (Supplemental CFS) (Details) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019
Cash payments:
Interest payments	$ 2,006	$ 2,157
Income tax payments	83	805
Non-cash items excluded from investing activities in the consolidated statements of cash flows:
Increase (decrease) in accrued capital expenditures	$ (7,095)	$ 475

Investment in Exaro Energy II_2

Investment in Exaro Energy III LLC (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Schedule of Equity Method Investments Financials
Gain (loss) from investment in affiliates, net of income taxes	$ (173)	$ 427	$ 113	$ 457
Exaro Energy III LLC [Member]
Schedule of Equity Method Investments Financials
Equity method investment, ownership percentage	37.00%		37.00%
Share of equity in investment	$ 6,900		$ 6,900
Gain (loss) from investment in affiliates, net of income taxes	(200)	400	100	700
Tax (expense) benefit from equity investment	$ 0	$ 0	$ 0	$ 0

Long-Term Debt (Details)

Long-Term Debt (Details) $ in Thousands	Jun. 09, 2020USD ($)	Apr. 10, 2020USD ($)	Nov. 01, 2019USD ($)	Sep. 17, 2019USD ($)	Sep. 30, 2020USD ($)	Jun. 30, 2020USD ($)	Jun. 30, 2020USD ($)	Jun. 30, 2019USD ($)	Jun. 30, 2020USD ($)	Jun. 30, 2019USD ($)	Dec. 31, 2019USD ($)
Debt Instrument [Line Items]
Debt issuance costs incurred										$ 41
Interest expense							$ 2,151	$ 1,079	$ 3,365	$ 2,171
Amortization of debt issuance costs									1,372
Paycheck Protection Program, CARES Act [Member]
Debt Instrument [Line Items]
Original term of loan		2 years
Stated interest rate (as a percent)		1.00%
Loan amount		$ 3,400
JPMorgan Chase Bank [Member]
Debt Instrument [Line Items]
Maximum borrowing capacity	$ 95,000		$ 145,000	$ 65,000		$ 85,000	85,000		85,000
Periodic borrowing base reduction					$ 10,000	10,000
Debt issuance costs incurred	$ 0		$ 1,600	$ 1,800
Original term of loan				5 years
Remaining balance debt issue costs						1,900	1,900		1,900
Credit facility amount outstanding						79,100	79,100		79,100		$ 72,800
Letters of credit amount outstanding						1,900	1,900		1,900		$ 1,900
Line of credit, available						$ 4,000	$ 4,000		$ 4,000
Weighted average interest rate (as a percent)						4.00%	4.00%		4.00%		4.30%
Current ratio, minimum				1
Leverage ratio, maximum				3.50
Amortization of debt issuance costs							$ 1,000
Maximum cash balance				$ 5,000

Income Taxes - Provision (Benef

Income Taxes - Provision (Benefit) (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Current tax provision:
Federal			$ 275
State	$ (7)	$ 427	112	$ 454
Total	(7)	427	387	454
Deferred tax provision:
State	376		376
Total	376		376
Total tax provision:
Federal			275
State	369	427	488	454
Income tax provision	$ 369	$ 427	$ 763	$ 454

Income Taxes - Quarter info (De

Income Taxes - Quarter info (Details) - USD ($) $ in Thousands	3 Months Ended	6 Months Ended
	Jun. 30, 2020	Jun. 30, 2020	Mar. 27, 2020
Operating Loss Carryforwards [Line Items]
Expedited refund			$ 300
Deferred tax expense	$ 376	$ 376
Valuation allowance increase (decrease)		28,500
Annual carryover limitation	700	700
Oklahoma Tax Commission [Member]
Operating Loss Carryforwards [Line Items]
Valuation allowance	0	0
Deferred tax expense	400
Federal [Member]
Operating Loss Carryforwards [Line Items]
Valuation allowance	132,000	132,000
Operating loss carryforwards	398,700	398,700
State [Member]
Operating Loss Carryforwards [Line Items]
Valuation allowance	1,600	1,600
Operating loss carryforwards	$ 32,700	$ 32,700

Commitments and Contingencies (

Commitments and Contingencies (Details) $ in Millions	1 Months Ended	3 Months Ended	6 Months Ended
	Nov. 30, 2010USD ($)site	Sep. 30, 2019USD ($)	Jun. 30, 2020installment	Dec. 31, 2019USD ($)	Aug. 31, 2019USD ($)
Throughput commitment
Loss Contingency
Estimated deficiency				$ 1
Installments payment | installment			3
Lavaca County Case [Member]
Loss Contingency
Number of wells involved in litigation | site	2
Damages sought by plaintiffs	$ 5.3
Loss contingency payable				6.3
Accounts payable				$ 3.5
Litigation Case Harris County [Member]
Loss Contingency
Loss contingency provision accrual increase		$ 2.1
Accounts payable					$ 1.1