Battalion Oil (BATL) 10-Q21 Aug 232023 Q2 Quarterly reportFinancial data

Company Profile

Document and Entity Information

Document and Entity Information - shares	6 Months Ended
Document and Entity Information - shares	Jun. 30, 2023	Aug. 17, 2023
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Transition Report	false
Document Period End Date	Jun. 30, 2023
Entity Tax Identification Number	20-0700684
Entity Registrant Name	Battalion Oil Corp
Entity Incorporation, State or Country Code	DE
Entity File Number	001-35467
Entity Address, Address Line One	3505 West Sam Houston Parkway North
Entity Address, Address Line Two	Suite 300
Entity Address, City or Town	Houston
Entity Address, State or Province	TX
Entity Address, Postal Zip Code	77043
City Area Code	832
Local Phone Number	538-0300
Title of 12(b) Security	Common Stock, par value $0.0001
Trading Symbol	BATL
Security Exchange Name	NYSEAMER
Amendment Flag	false
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		16,456,563
Current Fiscal Year End Date	--12-31
Entity Central Index Key	0001282648
Document Fiscal Year Focus	2023
Document Fiscal Period Focus	Q2

CONDENSED CONSOLIDATED STATEMEN

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Oil, natural gas and natural gas liquids sales:
Total oil, natural gas and natural gas liquids sales	$ 53,885	$ 101,290	$ 118,158	$ 182,698
Other	387	221	1,256	415
Total operating revenues	54,272	101,511	119,414	183,113
Production:
Lease operating	11,365	11,909	23,056	23,433
Workover and other	2,634	1,383	3,969	2,248
Taxes other than income	3,180	5,372	6,370	10,323
Gathering and other	16,828	15,869	33,345	31,124
General and administrative	5,243	4,588	10,380	9,573
Depletion, depreciation and accretion	14,713	12,601	30,861	22,821
Total operating expenses	53,963	51,722	107,981	99,522
Income (loss) from operations	309	49,789	11,433	83,591
Other income (expenses):
Net gain (loss) on derivative contracts	4,473	(31,910)	23,946	(155,768)
Interest expense and other	(9,530)	(4,832)	(17,316)	(7,520)
Total other income (expenses)	(5,057)	(36,742)	6,630	(163,288)
Income (loss) before income taxes	(4,748)	13,047	18,063	(79,697)
Income tax benefit (provision)
Net income (loss)	$ (4,748)	$ 13,047	$ 18,063	$ (79,697)
Net income (loss) per share of common stock:
Basic (in dollars per share)	$ (0.35)	$ 0.80	$ 0.87	$ (4.88)
Diluted (in dollars per share)	$ (0.35)	$ 0.79	$ 0.86	$ (4.88)
Weighted average common shares outstanding:
Basic (in shares)	16,457	16,338	16,425	16,320
Diluted (in shares)	16,457	16,510	16,520	16,320
Oil
Oil, natural gas and natural gas liquids sales:
Total oil, natural gas and natural gas liquids sales	$ 46,168	$ 73,944	$ 100,383	$ 136,468
Natural gas
Oil, natural gas and natural gas liquids sales:
Total oil, natural gas and natural gas liquids sales	2,060	14,759	4,960	23,640
NGLs
Oil, natural gas and natural gas liquids sales:
Total oil, natural gas and natural gas liquids sales	$ 5,657	$ 12,587	$ 12,815	$ 22,590

CONDENSED CONSOLIDATED BALANCE

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Current assets:
Cash and cash equivalents	$ 18,514	$ 32,726
Accounts receivable, net	23,518	37,974
Assets from derivative contracts	9,611	16,244
Restricted cash	90	90
Prepaids and other	1,049	1,131
Total current assets	52,782	88,165
Oil and natural gas properties (full cost method):
Subject to depletion	727,347	713,585
Unevaluated	62,649	62,621
Gross oil and natural gas properties	789,996	776,206
Less - accumulated depletion	(420,964)	(390,796)
Net oil and natural gas properties	369,032	385,410
Other operating property and equipment:
Other operating property and equipment	4,674	4,434
Less - accumulated depreciation	(1,486)	(1,209)
Net other operating property and equipment	3,188	3,225
Other noncurrent assets:
Assets from derivative contracts	5,299	5,379
Operating lease right of use assets	162	352
Other assets	2,778	2,827
Total assets	433,241	485,358
Current liabilities:
Accounts payable and accrued liabilities	48,897	100,095
Liabilities from derivative contracts	15,480	29,286
Current portion of long-term debt	42,606	35,067
Operating lease liabilities	162	352
Asset retirement obligations	111	225
Total current liabilities	107,256	165,025
Long-term debt, net	164,055	182,676
Other noncurrent liabilities:
Liabilities from derivative contracts	17,406	33,649
Asset retirement obligations	15,741	15,244
Other	3,432	4,136
Commitments and contingencies (Note 9)
Temporary equity:
Series A redeemable convertible preferred stock: 25,000 shares of $.0001 par value authorized, issued and outstanding as of June 30, 2023	26,030
Stockholders' equity:
Common stock: 100,000,000 shares of $0.0001 par value authorized; 16,456,563 and 16,344,815 shares issued and outstanding as of June 30, 2023 and December 31, 2022, respectively	2	2
Additional paid-in capital	331,201	334,571
Retained earnings (accumulated deficit)	(231,882)	(249,945)
Total stockholders' equity	99,321	84,628
Total liabilities, temporary equity and stockholders' equity	$ 433,241	$ 485,358

CONDENSED CONSOLIDATED BALANC_2

CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares	Jun. 30, 2023	Dec. 31, 2022
Stockholders' equity:
Preferred stock, par value (in dollars per share)	$ 0.0001
Preferred stock, shares authorized	25,000
Preferred stock, shares issued	25,000
Preferred stock, shares outstanding	25,000
Common stock, shares authorized	100,000,000	100,000,000
Common stock, par value (in dollars per share)	$ 0.0001	$ 0.0001
Common stock, shares issued	16,456,563	16,344,815
Common stock, shares outstanding	16,456,563	16,344,815

CONDENSED CONSOLIDATED STATEM_2

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS EQUITY - USD ($) shares in Thousands, $ in Thousands	Common Stock	Additional Paid-In Capital	Retained Earnings (Accumulated Deficit)	Total
Balances at Dec. 31, 2021	$ 2	$ 332,187	$ (268,484)	$ 63,705
Balances (in shares) at Dec. 31, 2021	16,274
Increase (Decrease) in Stockholders' Equity
Net income (loss)			(92,744)	(92,744)
Tax withholding on vesting of restricted stock units		(461)		(461)
Tax withholding on vesting of restricted stock units (in shares)	(26)
Stock-based compensation		452		452
Balances at Mar. 31, 2022	$ 2	332,178	(361,228)	(29,048)
Balances (in shares) at Mar. 31, 2022	16,337
Balances at Dec. 31, 2021	$ 2	332,187	(268,484)	63,705
Balances (in shares) at Dec. 31, 2021	16,274
Increase (Decrease) in Stockholders' Equity
Net income (loss)				(79,697)
Long-term incentive plan vestings (in shares)	89
Balances at Jun. 30, 2022	$ 2	332,766	(348,181)	(15,413)
Balances (in shares) at Jun. 30, 2022	16,338
Balances at Mar. 31, 2022	$ 2	332,178	(361,228)	(29,048)
Balances (in shares) at Mar. 31, 2022	16,337
Increase (Decrease) in Stockholders' Equity
Net income (loss)			13,047	13,047
Long-term incentive plan vestings (in shares)	1
Reduction in shares to cover individuals' tax withholding		(6)		(6)
Stock-based compensation		594		594
Balances at Jun. 30, 2022	$ 2	332,766	(348,181)	(15,413)
Balances (in shares) at Jun. 30, 2022	16,338
Increase (Decrease) in Stockholders' Equity
Net income (loss)			105,888	105,888
Long-term incentive plan vestings (in shares)	8
Reduction in shares to cover individuals' tax withholding		(25)		(25)
Reduction in shares to cover individuals' tax withholding (in shares)	(2)
Stock-based compensation		893		893
Balances at Sep. 30, 2022	$ 2	333,634	(242,293)	91,343
Balances (in shares) at Sep. 30, 2022	16,344
Increase (Decrease) in Stockholders' Equity
Net income (loss)			(7,652)	(7,652)
Stock-based compensation	$ 1	937		937
Balances at Dec. 31, 2022	$ 2	334,571	(249,945)	84,628
Balances (in shares) at Dec. 31, 2022	16,345
Increase (Decrease) in Stockholders' Equity
Net income (loss)			22,811	22,811
Deemed dividends for Series A preferred stock		(1,492)		(1,492)
Tax withholding on vesting of restricted stock units		(454)		(454)
Tax withholding on vesting of restricted stock units (in shares)	(47)
Stock-based compensation		327		327
Balances at Mar. 31, 2023	$ 2	332,952	(227,134)	105,820
Balances (in shares) at Mar. 31, 2023	16,457
Balances at Dec. 31, 2022	$ 2	334,571	(249,945)	84,628
Balances (in shares) at Dec. 31, 2022	16,345
Increase (Decrease) in Stockholders' Equity
Net income (loss)				18,063
Deemed dividends for Series A preferred stock				(1,500)
Long-term incentive plan vestings (in shares)	159
Balances at Jun. 30, 2023	$ 2	331,201	(231,882)	99,321
Balances (in shares) at Jun. 30, 2023	16,457
Balances at Mar. 31, 2023	$ 2	332,952	(227,134)	105,820
Balances (in shares) at Mar. 31, 2023	16,457
Increase (Decrease) in Stockholders' Equity
Net income (loss)			(4,748)	(4,748)
Equity issuance costs		(997)		(997)
Stock-based compensation		(754)		(754)
Balances at Jun. 30, 2023	$ 2	$ 331,201	$ (231,882)	$ 99,321
Balances (in shares) at Jun. 30, 2023	16,457

CONDENSED CONSOLIDATED STATEM_3

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022
Cash flows from operating activities:
Net income (loss)	$ 18,063	$ (79,697)
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Depletion, depreciation and accretion	30,861	22,821
Stock-based compensation, net	(545)	857
Unrealized loss (gain) on derivative contracts	(23,336)	78,201
Amortization of deferred loan costs	3,843	1,807
Reorganization items		(744)
Accrued settlements on derivative contracts	(929)	14,652
Change in fair value of embedded derivative liability	(704)	(2,595)
Other expense (income)	53	(96)
Change in assets and liabilities:
Accounts receivable	15,965	(12,596)
Prepaids and other	81	438
Accounts payable and accrued liabilities	(34,703)	5,285
Net cash provided by (used in) operating activities	8,649	28,333
Cash flows from investing activities:
Oil and natural gas capital expenditures	(32,633)	(51,377)
Proceeds received from sale of oil and natural gas assets	1,189
Other operating property and equipment capital expenditures	(284)	(705)
Proceeds received from sale of other operating property and equipment		96
Other	(11)
Net cash provided by (used in) investing activities	(31,739)	(51,986)
Cash flows from financing activities:
Proceeds from borrowings		20,000
Repayments of borrowings	(15,043)	(85)
Payment of deferred debt financing costs		(379)
Proceeds from issuance of preferred stock	24,375
Other	(454)	(467)
Net cash provided by (used in) financing activities	8,878	19,069
Net increase (decrease) in cash, cash equivalents and restricted cash	(14,212)	(4,584)
Cash, cash equivalents and restricted cash at beginning of period	32,816	48,359
Cash, cash equivalents and restricted cash at end of period	$ 18,604	$ 43,775

FINANCIAL STATEMENT PRESENTATIO

FINANCIAL STATEMENT PRESENTATION	6 Months Ended
FINANCIAL STATEMENT PRESENTATION	Jun. 30, 2023
FINANCIAL STATEMENT PRESENTATION
FINANCIAL STATEMENT PRESENTATION	1. FINANCIAL STATEMENT PRESENTATION Basis of Presentation and Principles of Consolidation Battalion is an independent energy company focused on the acquisition, production, exploration and development of onshore liquids-rich oil and natural gas assets in the United States. The consolidated financial statements include the accounts of all majority-owned, controlled subsidiaries. The Company operates in one segment which focuses on oil and natural gas acquisition, production, exploration and development. Allocation of capital is made across the Company’s entire portfolio without regard to operating area. All intercompany accounts and transactions have been eliminated. These unaudited condensed consolidated financial statements reflect, in the opinion of the Company’s management, all adjustments, consisting of normal and recurring adjustments, necessary to present fairly the financial position as of, and the results of operations for, the periods presented. Interim period results are not necessarily indicative of results of operations or cash flows for the full year and accordingly, certain information normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States, has been condensed or omitted. During interim periods, Battalion follows the accounting policies disclosed in its Annual Report on Form 10-K, as filed with the United States Securities and Exchange Commission (SEC) on March 30, 2023. Please refer to the notes in the Annual Report on Form 10-K for the year ended December 31, 2022 when reviewing interim financial results. The Company has evaluated events or transactions through the date of issuance of these unaudited condensed consolidated financial statements. Liquidity and Cash Requirements The accompanying unaudited Condensed Consolidated Financial Statements are prepared in accordance with GAAP applicable to a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. Our ability to execute our operating strategy is dependent on our ability to maintain adequate liquidity and continue to access capital, as needed. Our current business estimates and forecasts indicate that we will require additional liquidity to continue our operations and meet our debt covenant requirements for the next 12 months from the issuance of these condensed consolidated financial statements. In response to these events and conditions, we have continued to execute on a plan to reduce operating and capital costs to improve cash flow, including recent reductions in headcount to align with planned drilling activity Debt, Risk and Uncertainties Supply chain issues. Commodity Prices Oil and Natural Gas Properties” For further information regarding the actual and potential impacts of the supply chain issues and the potential impact of declines in commodity prices on the Company, see “Risk Factors” Use of Estimates The preparation of the Company’s unaudited condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States requires the Company’s management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities, if any, at the date of the unaudited condensed consolidated financial statements and the reported amounts of revenues and expenses during the respective reporting periods. Estimates and assumptions that, in the opinion of management of the Company, are significant include oil and natural gas revenue accruals, capital and operating expense accruals, oil and natural gas reserves, depletion relating to oil and natural gas properties, asset retirement obligations, and fair value estimates. The Company bases its estimates and judgments on historical experience and on various other assumptions and information believed to be reasonable under the circumstances. Estimates and assumptions about future events and their effects cannot be predicted with certainty and, accordingly, these estimates may change as new events occur, as more experience is acquired, as additional information is obtained and as the Company’s operating environment changes. Actual results may differ from the estimates and assumptions used in the preparation of the Company’s unaudited condensed consolidated financial statements. Cash, Cash Equivalents and Restricted Cash “Cash and cash equivalents” “Restricted cash” June 30, 2023 December 31, 2022 Cash and cash equivalents $ 18,514 $ 32,726 Restricted cash 90 90 Total cash, cash equivalents and restricted cash $ 18,604 $ 32,816 Accounts Receivable and Allowance for Doubtful Accounts The Company’s accounts receivable are primarily receivables from joint interest owners and oil and natural gas purchasers. Accounts receivable are recorded at the amount due, less an allowance for doubtful accounts, when applicable. Payment of our accounts receivable is typically received within 30-60 days. The Company’s historical credit losses have been de minimis and are expected to remain so in the future assuming no substantial changes to the business or creditworthiness of the Company’s counterparties. Concentrations of Credit Risk The Company’s primary concentrations of credit risk are the risks of uncollectible accounts receivable and of nonperformance by counterparties under the Company’s derivative contracts. Each reporting period, the Company assesses the recoverability of material receivables using historical data, current market conditions and reasonable and supportable forecasts of future economic conditions to determine expected collectability of its material receivables. The Company’s exposure to credit risk under its derivative contracts is varied among major financial institutions with investment grade credit ratings, where it has master netting agreements which provide for offsetting of amounts payable or receivable between the Company and the counterparty. To manage counterparty risk associated with derivative contracts, the Company selects and monitors counterparties based on an assessment of their financial strength and/or credit ratings. At June 30, 2023, the Company’s derivative counterparties include two major financial institutions, both of which are secured lenders under the Amended Term Loan Agreement. Recently Issued Accounting Pronouncements In the first quarter of 2023, the Company early adopted Accounting Standards Update (“ASU”) ASU 2020-06, Debt – Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging – Contracts in Entity’s Own Equity (Subtopic 815-40) (“ASU 2020-06)

LEASES

LEASES	6 Months Ended
LEASES	Jun. 30, 2023
LEASES
LEASES	2. LEASES The Company leases equipment and office space pursuant to operating leases. We determine if an arrangement is or contains a lease at inception and combine lease and nonlease components, when fixed, for all lease contracts. Nonlease components include common area maintenance charges on office leases and, when applicable, services associated with equipment leases. Operating leases with a lease term greater than 12 months where the Company is the lessee are included in “Operating lease right of use assets” “Operating lease liabilities” Payments due under the lease contracts include fixed payments plus, in some instances, variable payments. Variable lease payments, if applicable, associated with the Company’s leases are recognized when the event, activity, or circumstance in the lease agreement on which those payments are assessed occurs. Variable lease payments, when applicable, are presented as "Gathering and other” "General and administrative” “Operating lease right of use assets” Six Months Ended June 30, 2023 2022 Lease cost Operating lease costs $ 196 $ 196 Short-term lease costs 375 4,003 Variable lease costs — — Total lease costs $ 571 $ 4,199 Other information Cash paid for amounts included in the measurement of lease liabilities Operating cash flows from operating leases $ 196 $ 196 Right-of-use assets obtained in exchange for new operating lease liabilities — — Weighted-average remaining lease term - operating leases 0.4 years 1.4 years Weighted-average discount rate - operating leases 4.29 % 4.29 % June 30, 2023 Remaining period in 2023 $ 163 Thereafter — Total operating lease payments 163 Less: discount to present value 1 Total operating lease liabilities 162 Less: current operating lease liabilities 162 Noncurrent operating lease liabilities $ —

OPERATING REVENUES

OPERATING REVENUES	6 Months Ended
OPERATING REVENUES	Jun. 30, 2023
OPERATING REVENUES
OPERATING REVENUES	3. OPERATING REVENUES Substantially all of the Company’s revenues are derived from single basin operations, the Delaware Basin in Pecos, Reeves, Ward and Winkler Counties, Texas. Revenue is presented disaggregated in the statement of operations by major product, and depicts how the nature, timing, and uncertainty of revenue and cash flows are affected by economic factors in the Company’s single basin operations. Revenue is recognized when the following five steps are completed: (1) identify the contract with the customer, (2) identify the performance obligation (promise) in the contract, (3) determine the transaction price, (4) allocate the transaction price to the performance obligations in the contract, (5) recognize revenue when the reporting organization satisfies a performance obligation. Revenues from the sale of crude oil, natural gas and natural gas liquids are recognized, at a point in time, when a performance obligation is satisfied by the transfer of control of each unit (e.g. barrel of oil, Mcf of gas) of commodity to the customer. Revenue is measured based on contract consideration allocated to each unit of commodity and excludes amounts collected on behalf of third parties. Taxes assessed by a governmental authority that are both imposed on and concurrent with a specific revenue-producing transaction that are collected by the Company from a customer are excluded from revenue. Since the Company’s performance obligations have been satisfied and an unconditional right to consideration exists as of the balance sheet date, the Company recognized amounts due from contracts with customers of $19.9 million and $34.0 million as of June 30, 2023 and December 31, 2022, respectively, as “Accounts receivable, net” For additional information regarding our operating revenues, refer to our Annual Report on Form 10-K for the year ended December 31, 2022.

OIL AND NATURAL GAS PROPERTIES

OIL AND NATURAL GAS PROPERTIES	6 Months Ended
OIL AND NATURAL GAS PROPERTIES	Jun. 30, 2023
OIL AND NATURAL GAS PROPERTIES
OIL AND NATURAL GAS PROPERTIES	4. OIL AND NATURAL GAS PROPERTIES The Company uses the full cost method of accounting for its investment in oil and natural gas properties. Under this method of accounting, all costs of acquisition, exploration and development of oil and natural gas reserves (including such costs as leasehold acquisition costs, geological expenditures, treating equipment and gathering support facilities costs, dry hole costs, tangible and intangible development costs and direct internal costs) are capitalized as the cost of oil and natural gas properties when incurred. To the extent capitalized costs of evaluated oil and natural gas properties, net of accumulated depletion, exceed the discounted future net revenues of proved oil and natural gas reserves, net of deferred taxes, such excess capitalized costs are charged to expense. Additionally, the Company assesses all properties classified as unevaluated property on a quarterly basis for possible impairment. The Company assesses properties on an individual basis or as a group, if properties are individually insignificant. The assessment includes consideration of the following factors, among others: intent to drill; remaining lease term; geological and geophysical evaluations; drilling results and activity; the assignment of proved reserves; and the economic viability of development if proved reserves are assigned. During any period in which these factors indicate impairment, the cumulative drilling costs incurred to date for such property and all or a portion of the associated leasehold costs are transferred to the full cost pool and are then subject to depletion and the full cost ceiling test limitation. of our oil and natural gas properties

DEBT

DEBT	6 Months Ended
DEBT	Jun. 30, 2023
DEBT
DEBT	5. DEBT As of June 30, 2023 and December 31, 2022, the Company’s debt consisted of the following (in thousands): June 30, 2023 December 31, 2022 Term loan credit facility $ 220,000 $ 235,000 Other 265 190 Total debt (Face Value) 220,265 235,190 Less: Current portion of long-term debt (1) (42,606) (35,067) Other (2) (13,604) (17,447) Long-Term Debt, net $ 164,055 $ 182,676 (1) Amounts primarily reflect amortization payments under the Amended Term Loan Agreement due within one year. (2) Amounts primarily reflect unamortized debt issuance costs of approximately $9.9 million and $13.0 million at June 30, 2023 and December 31, 2022, respectively, but also includes remaining amounts to be accreted associated with the embedded derivative separately presented and further described in Note 6, “Fair Value Measurements”. Term Loan Credit Facility The Company may elect, at its option, to prepay any borrowing outstanding under the Amended Term Loan Agreement subject to the following prepayment premiums: Period (after applicable borrowing date (1) ) Premium Months 0-12 Make-whole amount equal to 12 months of interest plus 2.00% Months 13-24 2.00% Months 25-36 1.00% Months 37-48 0.00% (1) Applicable borrowing dates are November 2021 for the original $200 million borrowed and April and November 2022 for the $20 million and $15 million in delayed draw borrowings, respectively. The Company is required to make scheduled remaining amortization payments in the aggregate amount of $105.0 million from the fiscal quarter ending September 30, 2023 through the fiscal quarter ending September 30, 2025. Amounts outstanding under the Amended Term Loan Agreement are guaranteed by certain of the Borrower’s direct and indirect subsidiaries and secured by substantially all of the assets of the Borrower and such direct and indirect subsidiaries, and by the equity interests of the Borrower held by the Company. As part of the Amended Term Loan Agreement there are certain restrictions on the transfer of assets, including cash, to Battalion from the guarantor subsidiaries. ● Asset Coverage Ratio of not less than 1.80 to 1.00 as of June 30, 2023 and the last day of each fiscal quarter thereafter ● Total Net Leverage Ratio of not greater than 2.50 to 1.00 as of June 30, 2023, and each fiscal quarter thereafter, and ● Current Ratio of not less than 1.00 to 1.00, determined as of the last day of any fiscal quarter period, as of June 30, 2023 and for each fiscal quarter thereafter. As of June 30, 2023, the Company was in compliance with the financial covenants under the Amended Term Loan Agreement. The Amended Term Loan Agreement also contains certain events of default, including non-payment; breaches of representations and warranties; non-compliance with covenants or other agreements; cross-default to material indebtedness; judgments; change of control; and voluntary and involuntary bankruptcy. “Other noncurrent liabilities” “Interest expense and other” Fair Value Measurements the significant inputs to the valuation, and for a reconciliation of the change in fair value of the Change of Control Call Option.

FAIR VALUE MEASUREMENTS

FAIR VALUE MEASUREMENTS	6 Months Ended
FAIR VALUE MEASUREMENTS	Jun. 30, 2023
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS	6. 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 unaudited condensed consolidated balance sheets, but also the impact of the Company’s nonperformance risk on its own liabilities. Fair value is defined as 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). The Company separates the fair value of its financial instruments using a fair value hierarchy that 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. 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 were no transfers June 30, 2023 Level 1 Level 2 Level 3 Total Assets Assets from commodity-based derivative contracts $ — $ 14,910 $ — $ 14,910 Liabilities Liabilities from commodity-based derivative contracts $ — $ 32,886 $ — $ 32,886 December 31, 2022 Level 1 Level 2 Level 3 Total Assets Assets from commodity-based derivative contracts $ — $ 21,623 $ — $ 21,623 Liabilities Liabilities from commodity-based derivative contracts $ — $ 62,935 $ — $ 62,935 Derivative contracts listed above as Level 2 include fixed-price swaps, collars, basis swaps and WTI NYMEX rolls that are carried at fair value. The Company records the net change in the fair value of these positions in “Net gain (loss) on derivative contracts” “Derivative and Hedging Activities,” The Company’s derivative contracts are with major financial institutions with investment grade credit ratings which are believed to have minimal credit risk. As such, the Company is exposed to credit risk to the extent of nonperformance by the counterparties in the derivative contracts; however, the Company does not anticipate such nonperformance. As discussed in Note 5, “Debt,” “Interest expense and other” Change of Control Call Option Balance at December 31, 2022 $ 4,136 Change in fair value (704) Balance at June 30, 2023 $ 3,432 Estimated fair value amounts have been 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, cash equivalents and restricted cash, accounts receivable, and accounts payable approximates their carrying value due to their short-term nature. The estimated fair value of borrowings under the Company’s Amended Term Loan Agreement approximates carrying value because the interest rates approximate current market rates. The Company follows the provisions of ASC 820, for nonfinancial assets and liabilities measured at fair value on a non-recurring basis. These provisions apply to the Company’s initial recognition of asset retirement obligations for which fair value is used. The asset retirement obligation estimates are derived from historical costs and management’s expectation of future cost environments; and therefore, the Company has designated these liabilities as Level 3. See Note 8, “Asset Retirement Obligations,”

DERIVATIVE AND HEDGING ACTIVITI

DERIVATIVE AND HEDGING ACTIVITIES	6 Months Ended
DERIVATIVE AND HEDGING ACTIVITIES	Jun. 30, 2023
DERIVATIVE AND HEDGING ACTIVITIES
DERIVATIVE AND HEDGING ACTIVITIES	7. DERIVATIVE AND HEDGING ACTIVITIES The Company is exposed to commodity price risks relating to its ongoing business operations. In accordance with the Company’s policy and the requirements under the Term Loan Agreement, it generally hedges a substantial, but varying, portion of anticipated oil and natural gas production for future periods. Derivatives are carried at fair value on the unaudited condensed consolidated balance sheets as assets or liabilities, with the changes in the fair value included in the unaudited condensed consolidated statements of operations for the period in which the change occurs. The Company has elected not to designate any of its derivative contracts for hedge accounting. Accordingly, 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 “Net gain (loss) on derivative contracts” It is the Company’s policy to enter into derivative contracts only with counterparties that are creditworthy financial or commodity hedging institutions deemed by management as competent and competitive market makers. As of June 30, 2023, the Company did not post collateral under any of its derivative contracts as they are secured under the Company’s Term Loan Agreement. The Company’s crude oil, and natural gas derivative positions at any point in time may consist of fixed-price swaps, costless put/call collars, basis swaps and WTI NYMEX rolls further described as follows: ● Fixed-price swaps are designed so that the Company receives or makes payments based on a differential between fixed and variable prices for crude oil and natural gas. ● Costless collars consist of a sold call, which establishes a maximum price the Company will receive for the volumes under contract and a purchased put that establishes a minimum price and are generally utilized less frequently by the Company than fixed-price swaps. ● Basis swaps effectively lock in a price differential between regional prices (i.e. Midland) where the product is sold and the relevant pricing index under which the oil production is hedged (i.e. Cushing). ● WTI NYMEX roll agreements account for pricing adjustments to the trade month versus the delivery month for contract pricing. The following table summarizes the location and fair value amounts of all commodity derivative contracts in the unaudited condensed consolidated balance sheets as of June 30, 2023 and December 31, 2022 (in thousands): Balance sheet location June 30, 2023 December 31, 2022 Balance sheet location June 30, 2023 December 31, 2022 Current assets $ 9,611 $ 16,244 Current liabilities $ (15,480) $ (29,286) Other noncurrent assets 5,299 5,379 Other noncurrent liabilities (17,406) (33,649) $ 14,910 $ 21,623 $ (32,886) $ (62,935) The following table summarizes the location and amounts of the Company’s realized and unrealized gains and losses on derivative contracts in the Company’s unaudited condensed consolidated statements of operations (in thousands): Location of net gain (loss) Three Months Ended Six Months Ended on derivative contracts on June 30, June 30, Type Statement of Operations 2023 2022 2023 2022 Commodity derivative contracts: Unrealized gain (loss) Other income (expenses) $ 2,332 $ 12,837 $ 23,336 $ (78,201) Realized gain (loss) Other income (expenses) 2,141 (44,747) 610 (77,567) Total net gain (loss) $ 4,473 $ (31,910) $ 23,946 $ (155,768) At June 30, 2023, the Company had the following open crude oil and natural gas derivative contracts: Instrument 2023 2024 2025 2026 2027 Crude oil: Fixed-price swap: Total volumes (Bbls) 1,115,335 1,805,885 1,240,171 936,741 198,000 Weighted average price $ 67.36 $ 63.69 $ 61.18 $ 63.56 $ 59.64 Basis swap: Total volumes (Bbls) 1,047,536 1,801,951 1,240,171 936,741 198,000 Weighted average price $ 0.40 $ 0.27 $ 0.18 $ (0.01) $ 0.40 WTI NYMEX roll: Total volumes (Bbls) 1,097,510 1,784,914 1,240,171 936,741 198,000 Weighted average price $ 0.51 $ 0.27 $ 0.12 $ (0.03) $ — Natural gas: Fixed-price swap: Total volumes (MMBtu) 2,925,851 4,423,784 3,687,113 1,979,033 — Weighted average price $ 3.71 $ 3.54 $ 3.35 $ 4.00 $ — Two-way collar: Total volumes (MMBtu) 1,082,869 2,610,639 1,651,321 2,063,812 900,000 Weighted average price (call) $ 5.21 $ 5.08 $ 5.12 $ 5.26 $ 5.75 Weighted average price (put) $ 3.76 $ 3.67 $ 3.72 $ 3.70 $ 4.25 Basis swap: Total volumes (MMBtu) 4,008,720 7,034,372 5,319,878 4,042,845 900,000 Weighted average price $ (0.89) $ (0.87) $ (0.67) $ (0.77) $ (0.78) Derivative Assets Derivative Liabilities Offsetting of Derivative Assets and Liabilities June 30, 2023 December 31, 2022 June 30, 2023 December 31, 2022 Gross Amounts - Consolidated Balance Sheet $ 14,910 $ 21,623 $ (32,886) $ (62,935) Amounts Not Offset - Consolidated Balance Sheet (11,762) (20,997) 11,762 20,997 Net Amount $ 3,148 $ 626 $ (21,124) $ (41,938) The Company enters into an International Swap Dealers Association Master Agreement (ISDA) with each counterparty prior to a derivative contract with such counterparty. The ISDA is a standard contract that governs all derivative contracts entered into between the Company and the respective counterparty. The ISDA allows for offsetting of amounts payable or receivable between the Company and the counterparty, at the election of both parties, for transactions that occur on the same date and in the same currency.

ASSET RETIREMENT OBLIGATIONS

ASSET RETIREMENT OBLIGATIONS	6 Months Ended
ASSET RETIREMENT OBLIGATIONS	Jun. 30, 2023
ASSET RETIREMENT OBLIGATIONS
ASSET RETIREMENT OBLIGATIONS	8. ASSET RETIREMENT OBLIGATIONS The Company records an asset retirement obligation (ARO) on oil and natural gas properties when it can reasonably estimate the fair value of an obligation to perform site reclamation, dismantle facilities or plug and abandon costs. The Company records the ARO liability on the unaudited condensed consolidated balance sheets and capitalizes the cost in “Oil and natural gas properties” “Depletion, depreciation and accretion” The Company recorded the following activity related to its ARO liability (in thousands): Liability for asset retirement obligations as of December 31, 2022 $ 15,469 Accretion expense 372 Liabilities incurred during the period 11 Liability for asset retirement obligations as of June 30, 2023 15,852

COMMITMENTS AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES	6 Months Ended
COMMITMENTS AND CONTINGENCIES	Jun. 30, 2023
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES	9. COMMITMENTS AND CONTINGENCIES Commitments In May 2022, the Company entered into a joint venture agreement to develop a strategic acid gas treatment and carbon sequestration facility and entered into a gas treating agreement. The Company has a minimum volume commitment of 20,000 Mcf per day under the gas treating agreement, with certain rollover rights and start-up flexibility, for an initial term of five years from the in-service date of the facility. Under the gas treating agreement, the Company will pay a treating rate that begins at $1.65/Mcf and varies based on volumes delivered to the facility. At an initial treated volume of 12,000 Mcf/d, the commitment would be approximately $7.3 million for the first 12 months of the agreement. For additional information on this joint venture, see Note 13, “ Additional Financial Information”. The Company has entered into various long-term gathering, transportation and sales contracts with respect to its oil and natural gas production from the Delaware Basin in West Texas. As of June 30, 2023, the Company had in place multiple long-term crude oil and natural gas contracts in this area and the sales prices under these contracts are based on posted market rates. Under the terms of these contracts, the Company has committed a substantial portion of its production from this area for periods ranging from one Contingencies Surface owners of properties in Louisiana, where the Company formerly operated, often file lawsuits or assert claims against oil and gas companies claiming that operators and working interest owners are liable for environmental damages arising from operations conducted on the leased properties. These damages are frequently measured by the cost to restore the leased properties to their original condition. Currently and in the past, the Company has been party to such matters in Louisiana. With regard to pending matters, the overall exposure is not currently determinable. The Company intends to vigorously oppose these claims.

REDEEMABLE CONVERTIBLE PREFERRE

REDEEMABLE CONVERTIBLE PREFERRED STOCK	6 Months Ended
REDEEMABLE CONVERTIBLE PREFERRED STOCK	Jun. 30, 2023
Redeemable Convertible Preferred Stock [Abstract]
REDEEMABLE CONVERTIBLE PREFERRED STOCK	10. REDEEMABLE CONVERTIBLE PREFERRED STOCK Overview. For accounting purposes, upon issuance of the preferred stock on March 28, 2023, we recorded $23.5 million ($25.0 million net of original issue discount and accrued offering costs) as mezzanine equity (temporary equity) on the condensed consolidated balance sheets because it is not mandatorily redeemable but does contain a redemption feature at the option of the preferred holders that is considered not solely within the company’s control. Due to the redeemable nature of the preferred stock as further discussed below, at March 31, 2023, we recorded a non-cash deemed dividend of approximately $1.5 million to increase the carrying value of the preferred stock to its redemption amount of approximately $25 million. On June 30, 2023, the Company paid-in-kind (PIK) its dividend on the preferred stock for $1.0 million. As of June 30, 2023, the carrying value of the preferred stock equals its redemption amount, inclusive of PIK dividends of approximately $26.0 million. Voting Rights. Dividends. Conversion Features. Redemption Features (Change of Control) Redemption Features (Issuer). ● at any time prior to 120 days following the closing date, 100% of the Liquidation Preference at such time; ● at any time on or after 120 days following the closing date but prior to the 180 days following the closing date, 102% of the Liquidation Preference at such time; ● at any time on or after 180 days following the closing date but on or prior to the first anniversary of the closing date, 105% of the Liquidation Preference at such time; ● at any time after the first anniversary of the closing date but on or prior to the second anniversary of the closing date, 108% of the Liquidation Preference at such time; and ● at any time after the second anniversary of the closing date, 120% of the Liquidation Preference at such time. Redemption Features (Change of Control) ● at any time on or prior to 150 days following the issuance date, and at the election of the Company, a cash payment equal to the Liquidation Preference or equity consideration equal to the 107.5% of the Liquidation Preference, or ● at any time after the one hundred fiftieth ( 150 th) day following the issuance date, the Company shall offer each Holder a cash payment equal to the Redemption Price. Holders shall also have the ability to elect conversion into common stock at the Conversion Ratio. Until (i) a termination of or certain amendments to the Amended Term Loan Agreement or (ii) one year past the maturity date of the Amended Term Loan Agreement, an election of the cash payment option by holders in a change of control scenario is not permitted.

STOCKHOLDERS' EQUITY

STOCKHOLDERS' EQUITY	6 Months Ended
STOCKHOLDERS' EQUITY	Jun. 30, 2023
STOCKHOLDERS' EQUITY
STOCKHOLDERS' EQUITY	11. STOCKHOLDERS’ EQUITY Incentive Plans "General and administrative" Restricted Stock From time to time, the Company grants shares of restricted stock units (RSUs) under the Plan to employees of the Company. Under the Plan, employee RSUs will vest and convert to shares three , depending on award, or when the performance or market conditions occur as described further described in our Annual Report on Form 10-K for the year ended December 31, 2022. During the six months ended June 30, 2023, the Company granted less than 0.1 million shares of RSUs at a weighted average grant date fair value of $10.68 per share. At June 30, 2023, the Company had $1.3 million of unrecognized compensation expense related to non-vested RSU awards to be recognized over a weighted average period of less than 1 year . Stock Options From time to time, the Company has granted stock options under the Plan covering shares of common stock to employees of the Company. Stock options, when exercised, are settled through the payment of the exercise price in exchange for new shares of stock underlying the option. Awards granted under the Plan typically vest over a four year period at a rate of one from the date of grant.

EARNINGS PER SHARE

EARNINGS PER SHARE	6 Months Ended
EARNINGS PER SHARE	Jun. 30, 2023
EARNINGS PER SHARE
EARNINGS PER SHARE	12. EARNINGS PER SHARE The following represents the calculation of earnings (loss) per share (in thousands, except per share amounts): Three Months Ended Six Months Ended June 30, June 30, 2023 2022 2023 2022 Basic: Net income (loss) $ (4,748) $ 13,047 $ 18,063 $ (79,697) Less: Preferred stock dividend (997) — (2,489) — Less: Undistributed earnings allocable to preferred shareholders — — (1,301) — Net income (loss) available to common stockholders $ (5,745) $ 13,047 $ 14,273 $ (79,697) Weighted average basic number of common shares outstanding basic 16,457 16,338 16,425 16,320 Basic net income (loss) per share of common stock $ (0.35) $ 0.80 $ 0.87 $ (4.88) Diluted: Net income (loss) available to common stockholders basic $ (5,745) $ 13,047 $ 14,273 $ (79,697) Reallocation of undistributed earnings — — 7 — Net income (loss) available to common stockholders diluted $ (5,745) $ 13,047 $ 14,280 $ (79,697) Weighted average basic number of common shares outstanding basic 16,457 16,338 16,425 16,320 Common stock equivalent shares representing shares issuable upon: Exercise of warrants and stock options Anti-dilutive Anti-dilutive Anti-dilutive Anti-dilutive Vesting of restricted stock units Anti-dilutive 172 95 Anti-dilutive Weighted average diluted number of common shares outstanding diluted 16,457 16,510 16,520 16,320 Diluted net income (loss) per share of common stock $ (0.35) $ 0.79 $ 0.86 $ (4.88) We compute earnings per share in accordance with ASC Topic 260, Earnings per Share “Redeemable Convertible Preferred Stock” For the three and six months ended June 30, 2023, common stock equivalents, including options and restricted stock units, totaling 0.6 million and 0.5 million, respectively were anti-dilutive and not included in the computation of diluted earnings per share of common stock. For the three and six months ended June 30, 2022, common stock equivalents, including warrants, options and restricted stock units, totaling 7.4 million and 7.7 million, respectively, were not included in the computation of diluted earnings per share of common stock because the effect would have been anti-dilutive.

ADDITIONAL FINANCIAL STATEMENT

ADDITIONAL FINANCIAL STATEMENT INFORMATION	6 Months Ended
ADDITIONAL FINANCIAL STATEMENT INFORMATION	Jun. 30, 2023
ADDITIONAL FINANCIAL STATEMENT INFORMATION
ADDITIONAL FINANCIAL STATEMENT INFORMATION	13. ADDITIONAL FINANCIAL STATEMENT INFORMATION Certain balance sheet amounts are comprised of the following (in thousands): June 30, 2023 December 31, 2022 Accounts receivable, net: Oil, natural gas and natural gas liquids revenues $ 19,853 $ 33,980 Joint interest accounts 1,779 3,201 Other 1,886 793 $ 23,518 $ 37,974 Prepaids and other: Prepaids $ 509 $ 715 Funds in escrow 343 341 Other 197 75 $ 1,049 $ 1,131 Other assets (Non-current): Investment in unconsolidated affiliate (1) $ 1,477 $ 1,561 Oil, natural gas and natural gas liquids revenues 24 — Funds in escrow 538 527 Other 739 739 $ 2,778 $ 2,827 Accounts payable and accrued liabilities: Trade payables $ 17,884 $ 42,919 Accrued oil and natural gas capital costs 1,928 19,911 Revenues and royalties payable 20,392 26,759 Accrued interest expense 104 160 Accrued employee compensation 1,190 2,300 Accrued lease operating expenses 7,388 8,005 Other 11 41 $ 48,897 $ 100,095 (1) In May 2022, we entered into a joint venture with Caracara Services, LLC (“Caracara”) to develop an acid gas treatment facility to remove hydrogen sulfide and carbon dioxide from our produced natural gas. Caracara will provide all necessary capital for the construction of the treatment facility. We contributed certain full cost pool assets to the related party joint venture in a non-cash exchange for a retained 5% equity interest in BAT, an unconsolidated subsidiary. For accounting purposes, since we do not control the key activities (e.g. operating and maintaining the facility) which most significantly impact economic performance nor do we have the obligation to absorb losses or the right to receive benefits that could potentially be significant, we are not the primary beneficiary of BAT. Accordingly, we account for our investment in BAT (a related party) using the equity method of accounting based on our ability to exercise significant influence , but not control, over the key activities of the joint venture. For more information related to this joint venture, see Note 9, “Commitments and Contingencies ”.

FINANCIAL STATEMENT PRESENTAT_2

FINANCIAL STATEMENT PRESENTATION (Policies)	6 Months Ended
FINANCIAL STATEMENT PRESENTATION (Policies)	Jun. 30, 2023
FINANCIAL STATEMENT PRESENTATION
Basis of Presentation and Principles of Consolidation	Basis of Presentation and Principles of Consolidation Battalion is an independent energy company focused on the acquisition, production, exploration and development of onshore liquids-rich oil and natural gas assets in the United States. The consolidated financial statements include the accounts of all majority-owned, controlled subsidiaries. The Company operates in one segment which focuses on oil and natural gas acquisition, production, exploration and development. Allocation of capital is made across the Company’s entire portfolio without regard to operating area. All intercompany accounts and transactions have been eliminated. These unaudited condensed consolidated financial statements reflect, in the opinion of the Company’s management, all adjustments, consisting of normal and recurring adjustments, necessary to present fairly the financial position as of, and the results of operations for, the periods presented. Interim period results are not necessarily indicative of results of operations or cash flows for the full year and accordingly, certain information normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States, has been condensed or omitted. During interim periods, Battalion follows the accounting policies disclosed in its Annual Report on Form 10-K, as filed with the United States Securities and Exchange Commission (SEC) on March 30, 2023. Please refer to the notes in the Annual Report on Form 10-K for the year ended December 31, 2022 when reviewing interim financial results. The Company has evaluated events or transactions through the date of issuance of these unaudited condensed consolidated financial statements.
Liquidity and Cash Requirements	Liquidity and Cash Requirements The accompanying unaudited Condensed Consolidated Financial Statements are prepared in accordance with GAAP applicable to a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. Our ability to execute our operating strategy is dependent on our ability to maintain adequate liquidity and continue to access capital, as needed. Our current business estimates and forecasts indicate that we will require additional liquidity to continue our operations and meet our debt covenant requirements for the next 12 months from the issuance of these condensed consolidated financial statements. In response to these events and conditions, we have continued to execute on a plan to reduce operating and capital costs to improve cash flow, including recent reductions in headcount to align with planned drilling activity Debt,
Use of Estimates	Use of Estimates The preparation of the Company’s unaudited condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States requires the Company’s management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities, if any, at the date of the unaudited condensed consolidated financial statements and the reported amounts of revenues and expenses during the respective reporting periods. Estimates and assumptions that, in the opinion of management of the Company, are significant include oil and natural gas revenue accruals, capital and operating expense accruals, oil and natural gas reserves, depletion relating to oil and natural gas properties, asset retirement obligations, and fair value estimates. The Company bases its estimates and judgments on historical experience and on various other assumptions and information believed to be reasonable under the circumstances. Estimates and assumptions about future events and their effects cannot be predicted with certainty and, accordingly, these estimates may change as new events occur, as more experience is acquired, as additional information is obtained and as the Company’s operating environment changes. Actual results may differ from the estimates and assumptions used in the preparation of the Company’s unaudited condensed consolidated financial statements.
Risk and Uncertainties	Risk and Uncertainties Supply chain issues. Commodity Prices Oil and Natural Gas Properties” For further information regarding the actual and potential impacts of the supply chain issues and the potential impact of declines in commodity prices on the Company, see “Risk Factors”
Cash, Cash Equivalents and Restricted Cash	Cash, Cash Equivalents and Restricted Cash “Cash and cash equivalents” “Restricted cash” June 30, 2023 December 31, 2022 Cash and cash equivalents $ 18,514 $ 32,726 Restricted cash 90 90 Total cash, cash equivalents and restricted cash $ 18,604 $ 32,816
Accounts Receivable and Allowance for Doubtful Accounts	Accounts Receivable and Allowance for Doubtful Accounts The Company’s accounts receivable are primarily receivables from joint interest owners and oil and natural gas purchasers. Accounts receivable are recorded at the amount due, less an allowance for doubtful accounts, when applicable. Payment of our accounts receivable is typically received within 30-60 days. The Company’s historical credit losses have been de minimis and are expected to remain so in the future assuming no substantial changes to the business or creditworthiness of the Company’s counterparties.
Concentrations of Credit Risk	Concentrations of Credit Risk The Company’s primary concentrations of credit risk are the risks of uncollectible accounts receivable and of nonperformance by counterparties under the Company’s derivative contracts. Each reporting period, the Company assesses the recoverability of material receivables using historical data, current market conditions and reasonable and supportable forecasts of future economic conditions to determine expected collectability of its material receivables. The Company’s exposure to credit risk under its derivative contracts is varied among major financial institutions with investment grade credit ratings, where it has master netting agreements which provide for offsetting of amounts payable or receivable between the Company and the counterparty. To manage counterparty risk associated with derivative contracts, the Company selects and monitors counterparties based on an assessment of their financial strength and/or credit ratings. At June 30, 2023, the Company’s derivative counterparties include two major financial institutions, both of which are secured lenders under the Amended Term Loan Agreement.
Recently Issued Accounting Pronouncements	Recently Issued Accounting Pronouncements In the first quarter of 2023, the Company early adopted Accounting Standards Update (“ASU”) ASU 2020-06, Debt – Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging – Contracts in Entity’s Own Equity (Subtopic 815-40) (“ASU 2020-06)

FINANCIAL STATEMENT PRESENTAT_3

FINANCIAL STATEMENT PRESENTATION (Tables)	6 Months Ended
FINANCIAL STATEMENT PRESENTATION (Tables)	Jun. 30, 2023
FINANCIAL STATEMENT PRESENTATION
Schedule Of Cash, Cash Equivalents And Restricted Cash	June 30, 2023 December 31, 2022 Cash and cash equivalents $ 18,514 $ 32,726 Restricted cash 90 90 Total cash, cash equivalents and restricted cash $ 18,604 $ 32,816

LEASES (Tables)

LEASES (Tables)	6 Months Ended
LEASES (Tables)	Jun. 30, 2023
LEASES
Schedule of Company's leases	The table below summarizes the Company’s leases for the six months ended June 30, 2023 and 2022 (in thousands, except term and discount rate): Six Months Ended June 30, 2023 2022 Lease cost Operating lease costs $ 196 $ 196 Short-term lease costs 375 4,003 Variable lease costs — — Total lease costs $ 571 $ 4,199 Other information Cash paid for amounts included in the measurement of lease liabilities Operating cash flows from operating leases $ 196 $ 196 Right-of-use assets obtained in exchange for new operating lease liabilities — — Weighted-average remaining lease term - operating leases 0.4 years 1.4 years Weighted-average discount rate - operating leases 4.29 % 4.29 %
Schedule of future minimum lease payments associated with the Company's non-cancellable operating leases for office space and equipment	Future minimum lease payments associated with the Company’s non-cancellable operating leases for office space as of June 30, 2023 are presented in the table below (in thousands): June 30, 2023 Remaining period in 2023 $ 163 Thereafter — Total operating lease payments 163 Less: discount to present value 1 Total operating lease liabilities 162 Less: current operating lease liabilities 162 Noncurrent operating lease liabilities $ —

DEBT (Tables)

DEBT (Tables)	6 Months Ended
DEBT (Tables)	Jun. 30, 2023
DEBT
Schedule of debt	As of June 30, 2023 and December 31, 2022, the Company’s debt consisted of the following (in thousands): June 30, 2023 December 31, 2022 Term loan credit facility $ 220,000 $ 235,000 Other 265 190 Total debt (Face Value) 220,265 235,190 Less: Current portion of long-term debt (1) (42,606) (35,067) Other (2) (13,604) (17,447) Long-Term Debt, net $ 164,055 $ 182,676 (1) Amounts primarily reflect amortization payments under the Amended Term Loan Agreement due within one year. (2) Amounts primarily reflect unamortized debt issuance costs of approximately $9.9 million and $13.0 million at June 30, 2023 and December 31, 2022, respectively, but also includes remaining amounts to be accreted associated with the embedded derivative separately presented and further described in Note 6, “Fair Value Measurements”.
Schedule of prepayment premiums	The Company may elect, at its option, to prepay any borrowing outstanding under the Amended Term Loan Agreement subject to the following prepayment premiums: Period (after applicable borrowing date (1) ) Premium Months 0-12 Make-whole amount equal to 12 months of interest plus 2.00% Months 13-24 2.00% Months 25-36 1.00% Months 37-48 0.00% (1) Applicable borrowing dates are November 2021 for the original $200 million borrowed and April and November 2022 for the $20 million and $15 million in delayed draw borrowings, respectively.

FAIR VALUE MEASUREMENTS (Tables

FAIR VALUE MEASUREMENTS (Tables)	6 Months Ended
FAIR VALUE MEASUREMENTS (Tables)	Jun. 30, 2023
FAIR VALUE MEASUREMENTS
Schedule of fair value of the Company's financial assets and liabilities	June 30, 2023 Level 1 Level 2 Level 3 Total Assets Assets from commodity-based derivative contracts $ — $ 14,910 $ — $ 14,910 Liabilities Liabilities from commodity-based derivative contracts $ — $ 32,886 $ — $ 32,886 December 31, 2022 Level 1 Level 2 Level 3 Total Assets Assets from commodity-based derivative contracts $ — $ 21,623 $ — $ 21,623 Liabilities Liabilities from commodity-based derivative contracts $ — $ 62,935 $ — $ 62,935
Schedule of changes in fair value of the change of control call option	The following table sets forth a reconciliation of the changes in fair value of the Change of Control Call Option classified as Level 3 in the fair value hierarchy (in thousands): Change of Control Call Option Balance at December 31, 2022 $ 4,136 Change in fair value (704) Balance at June 30, 2023 $ 3,432

DERIVATIVE AND HEDGING ACTIVI_2

DERIVATIVE AND HEDGING ACTIVITIES (Tables)	6 Months Ended
DERIVATIVE AND HEDGING ACTIVITIES (Tables)	Jun. 30, 2023
DERIVATIVE AND HEDGING ACTIVITIES
Summary of location and fair value of derivative contracts	The following table summarizes the location and fair value amounts of all commodity derivative contracts in the unaudited condensed consolidated balance sheets as of June 30, 2023 and December 31, 2022 (in thousands): Balance sheet location June 30, 2023 December 31, 2022 Balance sheet location June 30, 2023 December 31, 2022 Current assets $ 9,611 $ 16,244 Current liabilities $ (15,480) $ (29,286) Other noncurrent assets 5,299 5,379 Other noncurrent liabilities (17,406) (33,649) $ 14,910 $ 21,623 $ (32,886) $ (62,935)
Summary of the location and amounts of the Company's realized and unrealized gains and losses on derivative contracts	The following table summarizes the location and amounts of the Company’s realized and unrealized gains and losses on derivative contracts in the Company’s unaudited condensed consolidated statements of operations (in thousands): Location of net gain (loss) Three Months Ended Six Months Ended on derivative contracts on June 30, June 30, Type Statement of Operations 2023 2022 2023 2022 Commodity derivative contracts: Unrealized gain (loss) Other income (expenses) $ 2,332 $ 12,837 $ 23,336 $ (78,201) Realized gain (loss) Other income (expenses) 2,141 (44,747) 610 (77,567) Total net gain (loss) $ 4,473 $ (31,910) $ 23,946 $ (155,768)
Schedule of open derivative contracts	At June 30, 2023, the Company had the following open crude oil and natural gas derivative contracts: Instrument 2023 2024 2025 2026 2027 Crude oil: Fixed-price swap: Total volumes (Bbls) 1,115,335 1,805,885 1,240,171 936,741 198,000 Weighted average price $ 67.36 $ 63.69 $ 61.18 $ 63.56 $ 59.64 Basis swap: Total volumes (Bbls) 1,047,536 1,801,951 1,240,171 936,741 198,000 Weighted average price $ 0.40 $ 0.27 $ 0.18 $ (0.01) $ 0.40 WTI NYMEX roll: Total volumes (Bbls) 1,097,510 1,784,914 1,240,171 936,741 198,000 Weighted average price $ 0.51 $ 0.27 $ 0.12 $ (0.03) $ — Natural gas: Fixed-price swap: Total volumes (MMBtu) 2,925,851 4,423,784 3,687,113 1,979,033 — Weighted average price $ 3.71 $ 3.54 $ 3.35 $ 4.00 $ — Two-way collar: Total volumes (MMBtu) 1,082,869 2,610,639 1,651,321 2,063,812 900,000 Weighted average price (call) $ 5.21 $ 5.08 $ 5.12 $ 5.26 $ 5.75 Weighted average price (put) $ 3.76 $ 3.67 $ 3.72 $ 3.70 $ 4.25 Basis swap: Total volumes (MMBtu) 4,008,720 7,034,372 5,319,878 4,042,845 900,000 Weighted average price $ (0.89) $ (0.87) $ (0.67) $ (0.77) $ (0.78)
Schedule of potential effects of master netting arrangements on the fair value of derivative contracts	Derivative Assets Derivative Liabilities Offsetting of Derivative Assets and Liabilities June 30, 2023 December 31, 2022 June 30, 2023 December 31, 2022 Gross Amounts - Consolidated Balance Sheet $ 14,910 $ 21,623 $ (32,886) $ (62,935) Amounts Not Offset - Consolidated Balance Sheet (11,762) (20,997) 11,762 20,997 Net Amount $ 3,148 $ 626 $ (21,124) $ (41,938)

ASSET RETIREMENT OBLIGATIONS (T

ASSET RETIREMENT OBLIGATIONS (Tables)	6 Months Ended
ASSET RETIREMENT OBLIGATIONS (Tables)	Jun. 30, 2023
ASSET RETIREMENT OBLIGATIONS
Schedule of activity related to ARO liability	The Company recorded the following activity related to its ARO liability (in thousands): Liability for asset retirement obligations as of December 31, 2022 $ 15,469 Accretion expense 372 Liabilities incurred during the period 11 Liability for asset retirement obligations as of June 30, 2023 15,852

EARNINGS PER SHARE (Tables)

EARNINGS PER SHARE (Tables)	6 Months Ended
EARNINGS PER SHARE (Tables)	Jun. 30, 2023
EARNINGS PER SHARE
Schedule of calculation of earnings (loss) per share	The following represents the calculation of earnings (loss) per share (in thousands, except per share amounts): Three Months Ended Six Months Ended June 30, June 30, 2023 2022 2023 2022 Basic: Net income (loss) $ (4,748) $ 13,047 $ 18,063 $ (79,697) Less: Preferred stock dividend (997) — (2,489) — Less: Undistributed earnings allocable to preferred shareholders — — (1,301) — Net income (loss) available to common stockholders $ (5,745) $ 13,047 $ 14,273 $ (79,697) Weighted average basic number of common shares outstanding basic 16,457 16,338 16,425 16,320 Basic net income (loss) per share of common stock $ (0.35) $ 0.80 $ 0.87 $ (4.88) Diluted: Net income (loss) available to common stockholders basic $ (5,745) $ 13,047 $ 14,273 $ (79,697) Reallocation of undistributed earnings — — 7 — Net income (loss) available to common stockholders diluted $ (5,745) $ 13,047 $ 14,280 $ (79,697) Weighted average basic number of common shares outstanding basic 16,457 16,338 16,425 16,320 Common stock equivalent shares representing shares issuable upon: Exercise of warrants and stock options Anti-dilutive Anti-dilutive Anti-dilutive Anti-dilutive Vesting of restricted stock units Anti-dilutive 172 95 Anti-dilutive Weighted average diluted number of common shares outstanding diluted 16,457 16,510 16,520 16,320 Diluted net income (loss) per share of common stock $ (0.35) $ 0.79 $ 0.86 $ (4.88)

ADDITIONAL FINANCIAL STATEMEN_2

ADDITIONAL FINANCIAL STATEMENT INFORMATION (Tables)	6 Months Ended
ADDITIONAL FINANCIAL STATEMENT INFORMATION (Tables)	Jun. 30, 2023
ADDITIONAL FINANCIAL STATEMENT INFORMATION
Schedule of additional financial statement information, balance sheet	Certain balance sheet amounts are comprised of the following (in thousands): June 30, 2023 December 31, 2022 Accounts receivable, net: Oil, natural gas and natural gas liquids revenues $ 19,853 $ 33,980 Joint interest accounts 1,779 3,201 Other 1,886 793 $ 23,518 $ 37,974 Prepaids and other: Prepaids $ 509 $ 715 Funds in escrow 343 341 Other 197 75 $ 1,049 $ 1,131 Other assets (Non-current): Investment in unconsolidated affiliate (1) $ 1,477 $ 1,561 Oil, natural gas and natural gas liquids revenues 24 — Funds in escrow 538 527 Other 739 739 $ 2,778 $ 2,827 Accounts payable and accrued liabilities: Trade payables $ 17,884 $ 42,919 Accrued oil and natural gas capital costs 1,928 19,911 Revenues and royalties payable 20,392 26,759 Accrued interest expense 104 160 Accrued employee compensation 1,190 2,300 Accrued lease operating expenses 7,388 8,005 Other 11 41 $ 48,897 $ 100,095 (1) In May 2022, we entered into a joint venture with Caracara Services, LLC (“Caracara”) to develop an acid gas treatment facility to remove hydrogen sulfide and carbon dioxide from our produced natural gas. Caracara will provide all necessary capital for the construction of the treatment facility. We contributed certain full cost pool assets to the related party joint venture in a non-cash exchange for a retained 5% equity interest in BAT, an unconsolidated subsidiary. For accounting purposes, since we do not control the key activities (e.g. operating and maintaining the facility) which most significantly impact economic performance nor do we have the obligation to absorb losses or the right to receive benefits that could potentially be significant, we are not the primary beneficiary of BAT. Accordingly, we account for our investment in BAT (a related party) using the equity method of accounting based on our ability to exercise significant influence , but not control, over the key activities of the joint venture. For more information related to this joint venture, see Note 9, “Commitments and Contingencies ”.

FINANCIAL STATEMENT PRESENTAT_4

FINANCIAL STATEMENT PRESENTATION (Details) $ in Thousands	3 Months Ended	6 Months Ended
FINANCIAL STATEMENT PRESENTATION (Details) $ in Thousands	Sep. 30, 2023 USD ($)	Jun. 30, 2023 USD ($) segment shareholder
Number of shareholders in private placement \| shareholder		3
Commitment letter from investors to purchase additional equity		$ 38,000
Proceeds from issuance of preferred stock		$ 24,375
Number of operating segments \| segment		1
Plan
Proceeds from issuance of preferred stock	$ 38,000

FINANCIAL STATEMENT PRESENTAT_5

FINANCIAL STATEMENT PRESENTATION - Cash, Cash Equivalents and Restricted Cash (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022	Jun. 30, 2022	Dec. 31, 2021
FINANCIAL STATEMENT PRESENTATION
Cash and cash equivalents	$ 18,514	$ 32,726
Restricted cash	90	90
Total cash, cash equivalents and restricted cash	$ 18,604	$ 32,816	$ 43,775	$ 48,359

LEASES (Details)

LEASES (Details) - USD ($) $ in Thousands	6 Months Ended
LEASES (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Jun. 30, 2022	Dec. 31, 2022
Lease cost
Operating lease costs	$ 196	$ 196
Short-term lease costs	375	4,003
Total lease costs	571	4,199
Other information
Operating cash flows from operating leases	$ 196	$ 196
Weighted-average remaining lease term - operating leases	4 months 24 days	1 year 4 months 24 days
Weighted-average discount rate - operating leases	4.29%	4.29%
Initial lease term	2 years 3 months 18 days		2 years 3 months 18 days

LEASES - Future Minimum Lease P

LEASES - Future Minimum Lease Payments (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Future minimum lease payments for non-cancellable operating leases
Remaining period in 2023	$ 163
Total operating lease payment	163
Less: discount to present value	(1)
Total operating lease liabilities	162
Less: current operating lease liabilities	$ 162	$ 352

OPERATING REVENUES - Revenue Re

OPERATING REVENUES - Revenue Recognition (Details) - USD ($) $ in Millions	Jun. 30, 2023	Dec. 31, 2022
Accounts receivable
Disaggregation of operating revenue
Due from contracts with customers	$ 19.9	$ 34

OIL AND NATURAL GAS PROPERTIES

OIL AND NATURAL GAS PROPERTIES - Ceiling Test Value of Company's Reserves (Details)	6 Months Ended
	Jun. 30, 2023 $ / bbl $ / MMBTU	Jun. 30, 2022 $ / bbl $ / MMBTU
Ceiling Limitation Disclosures
First-day-of-month 12-month average price for natural gas (in $/MMBtu) \| $ / MMBTU	4.76	5.13
First-day-of-month 12-month average price for crude oil used in ceiling test impairment (in dollars per barrel) \| $ / bbl	83.23	85.82

DEBT (Details)

DEBT (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Current and long-term debt
Debt	$ 220,265	$ 235,190
Current Portion of Long-Term Debt(1)	(42,606)	(35,067)
Other(2)	(13,604)	(17,447)
Total long-term debt	164,055	182,676
Unamortized debt issuance costs	9,900	13,000
Term loan credit facility
Current and long-term debt
Debt	220,000	235,000
Paycheck Protection Program Loan [Member]
Current and long-term debt
Debt	$ 265	$ 190

DEBT - Term Loan Credit Facilit

DEBT - Term Loan Credit Facility (Details) $ in Thousands		3 Months Ended	6 Months Ended
DEBT - Term Loan Credit Facility (Details) $ in Thousands	Nov. 14, 2022 USD ($)	Jun. 30, 2023 USD ($) item	Jun. 30, 2023 USD ($) item	Jun. 30, 2022 USD ($)	Nov. 30, 2022 USD ($)	Apr. 30, 2022 USD ($)	Nov. 30, 2021 USD ($)
Debt Instrument [Line Items]
Lender fees paid			$ 3,843	$ 1,807
Term loan credit facility
Debt Instrument [Line Items]
Amount available for issuance of letters of credit		$ 5,000	$ 5,000
Basis spread on variable rate (as a percent)			0.50%
Weighted average interest rate			12.60%
Lender fees paid	$ 2,400
Maturity date			Nov. 24, 2025
Amount outstanding		220,300	$ 220,300				$ 200,000
Letters of credit outstanding		$ 1,400	$ 1,400
Covenant compliance			As of June 30, 2023, the Company was in compliance with the financial covenants under the Amended Term Loan Agreement.
Threshold from capital expenditures to cash balance			$ 20,000
Maximum number of additional approved plan of development wells if out of compliance with loan agreement \| item		6	6
Aggregate scheduled amortization payments		$ 105,000	$ 105,000
Term loan credit facility \| Minimum
Debt Instrument [Line Items]
Asset coverage ratio		180%
Current ratio		100%
Term loan credit facility \| Maximum
Debt Instrument [Line Items]
Net Leverage Ratio		250%
Term loan credit facility \| Prior to February 15, 2020
Debt Instrument [Line Items]
Interest plus			2%
Term loan credit facility \| Prior to February 15, 2020 \| Minimum
Debt Instrument [Line Items]
Debt instrument prepayment term			0 months
Term loan credit facility \| Prior to February 15, 2020 \| Maximum
Debt Instrument [Line Items]
Debt instrument prepayment term			12 months
Term loan credit facility \| February 15, 2020
Debt Instrument [Line Items]
Interest plus			2%
Term loan credit facility \| February 15, 2020 \| Minimum
Debt Instrument [Line Items]
Debt instrument prepayment term			13 months
Term loan credit facility \| February 15, 2020 \| Maximum
Debt Instrument [Line Items]
Debt instrument prepayment term			24 months
Term loan credit facility \| February 15, 2021
Debt Instrument [Line Items]
Interest plus			1%
Term loan credit facility \| February 15, 2021 \| Minimum
Debt Instrument [Line Items]
Debt instrument prepayment term			25 months
Term loan credit facility \| February 15, 2021 \| Maximum
Debt Instrument [Line Items]
Debt instrument prepayment term			36 months
Term loan credit facility \| February 15, 2022
Debt Instrument [Line Items]
Interest plus			0%
Term loan credit facility \| February 15, 2022 \| Minimum
Debt Instrument [Line Items]
Debt instrument prepayment term			37 months
Term loan credit facility \| February 15, 2022 \| Maximum
Debt Instrument [Line Items]
Debt instrument prepayment term			48 months
Term loan credit facility \| Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate [Member]
Debt Instrument [Line Items]
Basis spread on variable rate (as a percent)			7.65%
Applicable margin (as a percent)			0.15%
Delayed Draw Term Loan
Debt Instrument [Line Items]
Incremental borrowing that we can make if we meet certain criteria					$ 15,000	$ 20,000

DEBT - Debt Maturities and Debt

DEBT - Debt Maturities and Debt Issuance Costs (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Debt Issuance Costs
Debt issuance costs	$ 13,604	$ 17,447

FAIR VALUE MEASUREMENTS (Detail

FAIR VALUE MEASUREMENTS (Details) - USD ($) $ in Thousands	6 Months Ended
FAIR VALUE MEASUREMENTS (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Assets
Asset transfers between levels	$ 0
Liabilities
Liability transfers between levels	0
Recurring \| Total
Assets
Receivables from derivative contracts	14,910	$ 21,623
Liabilities
Liabilities from derivative contracts	32,886	62,935
Recurring \| Level 2
Assets
Receivables from derivative contracts	14,910	21,623
Liabilities
Liabilities from derivative contracts	$ 32,886	$ 62,935

FAIR VALUE MEASUREMENTS - Chang

FAIR VALUE MEASUREMENTS - Change of Control Call Option (Details) - Change of Control Call Option $ in Thousands	6 Months Ended
	Jun. 30, 2023 USD ($)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Balance at the beginning of the period	$ 4,136
Change in fair value	(704)
Balance at the end of the period	$ 3,432

DERIVATIVE AND HEDGING ACTIVI_3

DERIVATIVE AND HEDGING ACTIVITIES - (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Derivative and hedging activities
Asset derivative contracts	$ 14,910	$ 21,623
Liability derivative contracts	(32,886)	(62,935)
Derivatives not designated as hedging contracts
Derivative and hedging activities
Asset derivative contracts	14,910	21,623
Liability derivative contracts	(32,886)	(62,935)
Derivatives not designated as hedging contracts \| Commodity contracts \| Current assets - receivables from derivative contracts
Derivative and hedging activities
Asset derivative contracts	9,611	16,244
Derivatives not designated as hedging contracts \| Commodity contracts \| Other noncurrent assets - receivables from derivative contracts
Derivative and hedging activities
Asset derivative contracts	5,299	5,379
Derivatives not designated as hedging contracts \| Commodity contracts \| Current liabilities - liabilities from derivative contracts
Derivative and hedging activities
Liability derivative contracts	(15,480)	(29,286)
Derivatives not designated as hedging contracts \| Commodity contracts \| Other noncurrent liabilities - liabilities from derivative contracts
Derivative and hedging activities
Liability derivative contracts	$ (17,406)	$ (33,649)

DERIVATIVE AND HEDGING ACTIVI_4

DERIVATIVE AND HEDGING ACTIVITIES - Realized Unrealized (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Derivative and hedging activities
Total net gain (loss) on derivative contracts	$ 4,473	$ (31,910)	$ 23,946	$ (155,768)
Derivatives not designated as hedging contracts \| Commodity contracts
Derivative and hedging activities
Total net gain (loss) on derivative contracts	4,473	(31,910)	23,946	(155,768)
Derivatives not designated as hedging contracts \| Commodity contracts \| Other Income Expense
Derivative and hedging activities
Unrealized gain (loss) on commodity contracts	2,332	12,837	23,336	(78,201)
Realized gain (loss) on commodity contracts	$ 2,141	$ (44,747)	$ 610	$ (77,567)

DERIVATIVE AND HEDGING ACTIVI_5

DERIVATIVE AND HEDGING ACTIVITIES - Open Contracts (Details)	6 Months Ended
	Jun. 30, 2023 MMBTU $ / bbl $ / MMBTU bbl
January 2023 - December 2023 \| Fixed Swap \| Natural Gas [Member]
Derivative and hedging activities
Volume in Mmbtu's \| MMBTU	2,925,851
January 2023 - December 2023 \| Fixed Swap \| Natural Gas [Member] \| Weighted Average
Derivative and hedging activities
Weighted Average Price (in dollars per Mmbtu's/Bbl's)	3.71
January 2023 - December 2023 \| Fixed Swap \| Crude oil
Derivative and hedging activities
Volume in Bbl's \| bbl	1,115,335
January 2023 - December 2023 \| Fixed Swap \| Crude oil \| Weighted Average
Derivative and hedging activities
Weighted Average Price (in dollars per Mmbtu's/Bbl's) \| $ / bbl	67.36
January 2023 - December 2023 \| Basis Swap \| Natural Gas [Member]
Derivative and hedging activities
Volume in Mmbtu's \| MMBTU	4,008,720
January 2023 - December 2023 \| Basis Swap \| Natural Gas [Member] \| Weighted Average
Derivative and hedging activities
Weighted Average Price (in dollars per Mmbtu's/Bbl's)	(0.89)
January 2023 - December 2023 \| Basis Swap \| Crude oil
Derivative and hedging activities
Volume in Bbl's \| bbl	1,047,536
January 2023 - December 2023 \| Basis Swap \| Crude oil \| Weighted Average
Derivative and hedging activities
Weighted Average Price (in dollars per Mmbtu's/Bbl's) \| $ / bbl	0.40
January 2023 - December 2023 \| WTI NYMEX Roll \| Crude oil \| Maximum
Derivative and hedging activities
Volume in Bbl's \| bbl	1,097,510
January 2023 - December 2023 \| WTI NYMEX Roll \| Crude oil \| Weighted Average
Derivative and hedging activities
Weighted Average Price (in dollars per Mmbtu's/Bbl's) \| $ / bbl	0.51
January 2023 - December 2023 \| Collars \| Natural Gas [Member]
Derivative and hedging activities
Volume in Mmbtu's \| MMBTU	1,082,869
January 2023 - December 2023 \| Call option \| Natural Gas [Member] \| Weighted Average
Derivative and hedging activities
Weighted Average Price (in dollars per Mmbtu's/Bbl's)	5.21
January 2023 - December 2023 \| Put options \| Natural Gas [Member] \| Weighted Average
Derivative and hedging activities
Weighted Average Price (in dollars per Mmbtu's/Bbl's)	3.76
January 2024 - December 2024 \| Fixed Swap \| Natural Gas [Member] \| Minimum
Derivative and hedging activities
Floor (in dollars per Mmbtu's/Bbl's)	4,423,784
January 2024 - December 2024 \| Fixed Swap \| Natural Gas [Member] \| Weighted Average
Derivative and hedging activities
Weighted Average Price (in dollars per Mmbtu's/Bbl's)	3.54
January 2024 - December 2024 \| Fixed Swap \| Crude oil
Derivative and hedging activities
Volume in Bbl's \| bbl	1,805,885
January 2024 - December 2024 \| Fixed Swap \| Crude oil \| Weighted Average
Derivative and hedging activities
Weighted Average Price (in dollars per Mmbtu's/Bbl's) \| $ / bbl	63.69
January 2024 - December 2024 \| Basis Swap \| Natural Gas [Member]
Derivative and hedging activities
Volume in Mmbtu's \| MMBTU	7,034,372
January 2024 - December 2024 \| Basis Swap \| Natural Gas [Member] \| Weighted Average
Derivative and hedging activities
Weighted Average Price (in dollars per Mmbtu's/Bbl's)	(0.87)
January 2024 - December 2024 \| Basis Swap \| Crude oil
Derivative and hedging activities
Volume in Bbl's \| bbl	1,801,951
January 2024 - December 2024 \| Basis Swap \| Crude oil \| Weighted Average
Derivative and hedging activities
Weighted Average Price (in dollars per Mmbtu's/Bbl's) \| $ / bbl	0.27
January 2024 - December 2024 \| WTI NYMEX Roll \| Crude oil \| Maximum
Derivative and hedging activities
Volume in Bbl's \| bbl	1,784,914
January 2024 - December 2024 \| WTI NYMEX Roll \| Crude oil \| Weighted Average
Derivative and hedging activities
Weighted Average Price (in dollars per Mmbtu's/Bbl's) \| $ / bbl	0.27
January 2024 - December 2024 \| Collars \| Natural Gas [Member]
Derivative and hedging activities
Volume in Mmbtu's \| MMBTU	2,610,639
January 2024 - December 2024 \| Call option \| Natural Gas [Member] \| Weighted Average
Derivative and hedging activities
Weighted Average Price (in dollars per Mmbtu's/Bbl's)	5.08
January 2024 - December 2024 \| Put options \| Natural Gas [Member] \| Weighted Average
Derivative and hedging activities
Weighted Average Price (in dollars per Mmbtu's/Bbl's)	3.67
January 2025 - December 2025 \| Fixed Swap \| Natural Gas [Member]
Derivative and hedging activities
Volume in Mmbtu's \| MMBTU	3,687,113
January 2025 - December 2025 \| Fixed Swap \| Natural Gas [Member] \| Weighted Average
Derivative and hedging activities
Weighted Average Price (in dollars per Mmbtu's/Bbl's)	3.35
January 2025 - December 2025 \| Fixed Swap \| Crude oil
Derivative and hedging activities
Volume in Bbl's \| bbl	1,240,171
January 2025 - December 2025 \| Fixed Swap \| Crude oil \| Weighted Average
Derivative and hedging activities
Weighted Average Price (in dollars per Mmbtu's/Bbl's) \| $ / bbl	61.18
January 2025 - December 2025 \| Basis Swap \| Natural Gas [Member]
Derivative and hedging activities
Volume in Mmbtu's \| MMBTU	5,319,878
January 2025 - December 2025 \| Basis Swap \| Natural Gas [Member] \| Weighted Average
Derivative and hedging activities
Weighted Average Price (in dollars per Mmbtu's/Bbl's)	(0.67)
January 2025 - December 2025 \| Basis Swap \| Crude oil
Derivative and hedging activities
Volume in Bbl's \| bbl	1,240,171
January 2025 - December 2025 \| Basis Swap \| Crude oil \| Weighted Average
Derivative and hedging activities
Weighted Average Price (in dollars per Mmbtu's/Bbl's) \| $ / bbl	0.18
January 2025 - December 2025 \| WTI NYMEX Roll \| Crude oil \| Maximum
Derivative and hedging activities
Volume in Bbl's \| bbl	1,240,171
January 2025 - December 2025 \| WTI NYMEX Roll \| Crude oil \| Weighted Average
Derivative and hedging activities
Weighted Average Price (in dollars per Mmbtu's/Bbl's) \| $ / bbl	0.12
January 2025 - December 2025 \| Collars \| Natural Gas [Member]
Derivative and hedging activities
Volume in Mmbtu's \| MMBTU	1,651,321
January 2025 - December 2025 \| Call option \| Natural Gas [Member] \| Weighted Average
Derivative and hedging activities
Weighted Average Price (in dollars per Mmbtu's/Bbl's)	5.12
January 2025 - December 2025 \| Put options \| Natural Gas [Member] \| Weighted Average
Derivative and hedging activities
Weighted Average Price (in dollars per Mmbtu's/Bbl's)	3.72
January 2026 - December 2026 \| Fixed Swap \| Natural Gas [Member]
Derivative and hedging activities
Volume in Mmbtu's \| MMBTU	1,979,033
January 2026 - December 2026 \| Fixed Swap \| Natural Gas [Member] \| Weighted Average
Derivative and hedging activities
Weighted Average Price (in dollars per Mmbtu's/Bbl's)	4
January 2026 - December 2026 \| Fixed Swap \| Crude oil
Derivative and hedging activities
Volume in Bbl's \| bbl	936,741
January 2026 - December 2026 \| Fixed Swap \| Crude oil \| Weighted Average
Derivative and hedging activities
Weighted Average Price (in dollars per Mmbtu's/Bbl's) \| $ / bbl	63.56
January 2026 - December 2026 \| Basis Swap \| Natural Gas [Member]
Derivative and hedging activities
Volume in Mmbtu's \| MMBTU	4,042,845
January 2026 - December 2026 \| Basis Swap \| Natural Gas [Member] \| Weighted Average
Derivative and hedging activities
Weighted Average Price (in dollars per Mmbtu's/Bbl's)	(0.77)
January 2026 - December 2026 \| Basis Swap \| Crude oil
Derivative and hedging activities
Volume in Bbl's \| bbl	936,741
January 2026 - December 2026 \| Basis Swap \| Crude oil \| Weighted Average
Derivative and hedging activities
Weighted Average Price (in dollars per Mmbtu's/Bbl's) \| $ / bbl	(0.01)
January 2026 - December 2026 \| WTI NYMEX Roll \| Crude oil \| Maximum
Derivative and hedging activities
Volume in Bbl's \| bbl	936,741
January 2026 - December 2026 \| WTI NYMEX Roll \| Crude oil \| Weighted Average
Derivative and hedging activities
Weighted Average Price (in dollars per Mmbtu's/Bbl's) \| $ / bbl	(0.03)
January 2026 - December 2026 \| Collars \| Natural Gas [Member]
Derivative and hedging activities
Volume in Mmbtu's \| MMBTU	2,063,812
January 2026 - December 2026 \| Call option \| Natural Gas [Member] \| Weighted Average
Derivative and hedging activities
Weighted Average Price (in dollars per Mmbtu's/Bbl's)	5.26
January 2026 - December 2026 \| Put options \| Natural Gas [Member] \| Weighted Average
Derivative and hedging activities
Weighted Average Price (in dollars per Mmbtu's/Bbl's)	3.70
January 2027 - December 2027 \| Fixed Swap \| Crude oil
Derivative and hedging activities
Volume in Bbl's \| bbl	198,000
January 2027 - December 2027 \| Fixed Swap \| Crude oil \| Weighted Average
Derivative and hedging activities
Weighted Average Price (in dollars per Mmbtu's/Bbl's) \| $ / bbl	59.64
January 2027 - December 2027 \| Basis Swap \| Natural Gas [Member]
Derivative and hedging activities
Volume in Mmbtu's \| MMBTU	900,000
January 2027 - December 2027 \| Basis Swap \| Natural Gas [Member] \| Weighted Average
Derivative and hedging activities
Weighted Average Price (in dollars per Mmbtu's/Bbl's)	(0.78)
January 2027 - December 2027 \| Basis Swap \| Crude oil
Derivative and hedging activities
Volume in Bbl's \| bbl	198,000
January 2027 - December 2027 \| Basis Swap \| Crude oil \| Weighted Average
Derivative and hedging activities
Weighted Average Price (in dollars per Mmbtu's/Bbl's) \| $ / bbl	0.40
January 2027 - December 2027 \| WTI NYMEX Roll \| Crude oil \| Maximum
Derivative and hedging activities
Volume in Bbl's \| bbl	198,000
January 2027 - December 2027 \| Collars \| Natural Gas [Member]
Derivative and hedging activities
Volume in Mmbtu's \| MMBTU	900,000
January 2027 - December 2027 \| Call option \| Natural Gas [Member] \| Weighted Average
Derivative and hedging activities
Weighted Average Price (in dollars per Mmbtu's/Bbl's)	5.75
January 2027 - December 2027 \| Put options \| Natural Gas [Member] \| Weighted Average
Derivative and hedging activities
Weighted Average Price (in dollars per Mmbtu's/Bbl's)	4.25

DERIVATIVE AND HEDGING ACTIVI_6

DERIVATIVE AND HEDGING ACTIVITIES - Netting Arrangements (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Derivative Assets
Gross Amounts Presented in the Consolidated Balance Sheet	$ 14,910	$ 21,623
Amounts Not Offset in the Consolidated Balance Sheet	(11,762)	(20,997)
Net Amount	3,148	626
Derivative Liabilities
Gross Amounts Presented in the Consolidated Balance Sheet	(32,886)	(62,935)
Amounts Not Offset in the Consolidated Balance Sheet	11,762	20,997
Net Amount	$ (21,124)	$ (41,938)

ASSET RETIREMENT OBLIGATIONS (D

ASSET RETIREMENT OBLIGATIONS (Details) $ in Thousands	6 Months Ended
ASSET RETIREMENT OBLIGATIONS (Details) $ in Thousands	Jun. 30, 2023 USD ($)
Activity related to ARO liability
Asset retirement obligations at beginning of the period	$ 15,469
Accretion expense	372
Liabilities incurred	11
Asset retirement obligations at end of period	$ 15,852

COMMITMENTS AND CONTINGENCIES (

COMMITMENTS AND CONTINGENCIES (Details) $ in Millions	1 Months Ended	6 Months Ended	12 Months Ended
COMMITMENTS AND CONTINGENCIES (Details) $ in Millions	May 31, 2022 USD ($) MMcf / d $ / Mcf	Jun. 30, 2023	Dec. 31, 2024 MMcf / d
Obligations under drilling rig commitments
Commitment next year \| $	$ 7.3
Minimum volume commitment	20,000
Volume commitment term	5 years
Minimum
Obligations under drilling rig commitments
Treating rate paid \| $ / Mcf	1.65
Gathering, transportation and sales \| West Texas \| Minimum
Obligations under drilling rig commitments
Period of commitment for production from the date of first production		1 year
Gathering, transportation and sales \| West Texas \| Maximum
Obligations under drilling rig commitments
Period of commitment for production from the date of first production		20 years
Plan
Obligations under drilling rig commitments
Minimum volume commitment			12,000

REDEEMABLE CONVERTIBLE PREFER_2

REDEEMABLE CONVERTIBLE PREFERRED STOCK (Details) $ / shares in Units, $ in Thousands			3 Months Ended		6 Months Ended
	Jun. 30, 2023 USD ($) shareholder	Mar. 28, 2023 USD ($) shareholder person $ / shares shares	Jun. 30, 2023 USD ($) shareholder	Mar. 31, 2023 USD ($)	Jun. 30, 2023 USD ($) shareholder
Class of Stock [Line Items]
Number of Shareholders in Private Placement \| shareholder	3		3		3
Board of directors, members \| person		6
Series A redeemable convertible preferred stock	$ 26,030	$ 23,500	$ 26,030		$ 26,030
Series A redeemable convertible preferred stock redemption amount	25,000	25,000	25,000		25,000
Deemed dividends for Series A preferred stock				$ 1,492	1,500
Redeemable Convertible Preferred Stock [Member]
Class of Stock [Line Items]
Proceeds from preferred stock offering		24,400
Beneficial conversion proceeds		$ 600
Shares issued \| shares		25,000
Number of Shareholders in Private Placement \| shareholder		3
Series A redeemable convertible preferred stock redemption amount	26,000		$ 26,000		$ 26,000
Deemed dividends for Series A preferred stock	$ 1,000
Preferred stock voting rights		no
Dividend rate (as a percent)		14.50%
Liquidation preference per share (in dollars per share) \| $ / shares		$ 1,000
Preferred Stock, Liquidation Preference, Value		$ 25,000
Percentage of liquidation preference paid to redeem shares	107.50%	18%	107.50%		107.50%
Threshold of time following change of control		20 days
Percentage of common stock value over Conversion Price threshold		130%
Period past maturity date of term loan agreement if election of cash payment option is not permitted			1 year
Redeemable Convertible Preferred Stock [Member] \| Maximum
Class of Stock [Line Items]
Threshold of time following change of control			150 days
Redeemable Convertible Preferred Stock [Member] \| Annually [Member]
Class of Stock [Line Items]
Dividend rate (as a percent)		16%
Redeemable Convertible Preferred Stock [Member] \| Redemption Period One [Member]
Class of Stock [Line Items]
Percentage of liquidation preference paid to redeem shares		100%
Redeemable Convertible Preferred Stock [Member] \| Redemption Period One [Member] \| Maximum
Class of Stock [Line Items]
Redemption feature, time period after closing date			120 days
Redeemable Convertible Preferred Stock [Member] \| Redemption Period Two [Member]
Class of Stock [Line Items]
Percentage of liquidation preference paid to redeem shares		102%
Redeemable Convertible Preferred Stock [Member] \| Redemption Period Two [Member] \| Minimum
Class of Stock [Line Items]
Redemption feature, time period after closing date			120 days
Redeemable Convertible Preferred Stock [Member] \| Redemption Period Two [Member] \| Maximum
Class of Stock [Line Items]
Redemption feature, time period after closing date			180 days
Redeemable Convertible Preferred Stock [Member] \| Redemption Period Three [Member]
Class of Stock [Line Items]
Percentage of liquidation preference paid to redeem shares		105%
Redeemable Convertible Preferred Stock [Member] \| Redemption Period Three [Member] \| Minimum
Class of Stock [Line Items]
Redemption feature, time period after closing date			180 days
Redeemable Convertible Preferred Stock [Member] \| Redemption Period Three [Member] \| Maximum
Class of Stock [Line Items]
Redemption feature, time period after closing date			1 year
Redeemable Convertible Preferred Stock [Member] \| Redemption Period Four [Member]
Class of Stock [Line Items]
Percentage of liquidation preference paid to redeem shares		108%
Redeemable Convertible Preferred Stock [Member] \| Redemption Period Four [Member] \| Minimum
Class of Stock [Line Items]
Redemption feature, time period after closing date			1 year
Redeemable Convertible Preferred Stock [Member] \| Redemption Period Four [Member] \| Maximum
Class of Stock [Line Items]
Redemption feature, time period after closing date			2 years
Redeemable Convertible Preferred Stock [Member] \| Redemption Period Five [Member]
Class of Stock [Line Items]
Percentage of liquidation preference paid to redeem shares		120%
Redeemable Convertible Preferred Stock [Member] \| Redemption Period Five [Member] \| Minimum
Class of Stock [Line Items]
Redemption feature, time period after closing date			2 years

STOCKHOLDERS' EQUITY - Incentiv

STOCKHOLDERS' EQUITY - Incentive Plans (Details) - USD ($) shares in Millions, $ in Millions	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022
Directors and employees
Stock-based compensation
Compensation expense recorded		$ 0.9
Allocated share based compensation credit	$ (0.5)
2020 Incentive Plan
Stock-based compensation
Aggregate number of shares available	1.8
Maximum number of shares that remained reserved for issuance under the Plan	0.6

STOCKHOLDERS' EQUITY - Restrict

STOCKHOLDERS' EQUITY - Restricted Stock (Details) - Restricted Stock $ / shares in Units, shares in Millions, $ in Millions	6 Months Ended
	Jun. 30, 2023 USD ($) $ / shares shares
Stock-based compensation
Number of shares granted \| shares	0.1
Granted (in dollars per share) \| $ / shares	$ 10.68
Unrecognized compensation expense other than options \| $	$ 1.3
Minimum
Stock-based compensation
Vesting period	3 years
Maximum
Stock-based compensation
Vesting period	4 years
Weighted average remaining vesting period	1 year

STOCKHOLDERS' EQUITY - Stock Op

STOCKHOLDERS' EQUITY - Stock Options (Details) - Stock options $ in Millions	6 Months Ended
	Jun. 30, 2023 USD ($) shares
Stock-based compensation
Vesting period	4 years
Percentage of awards vesting on the annual anniversary date of the grant	0.25
Expiration term	7 years
Unrecognized compensation expense stock option \| $	$ 0.1
Weighted average remaining vesting period	1 year
Granted (in shares) \| shares	0

EARNINGS PER SHARE (Details)

EARNINGS PER SHARE (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended						6 Months Ended
	Jun. 30, 2023	Mar. 31, 2023	Dec. 31, 2022	Sep. 30, 2022	Jun. 30, 2022	Mar. 31, 2022	Jun. 30, 2023	Jun. 30, 2022
Basic:
Net income (loss)	$ (4,748)	$ 22,811	$ (7,652)	$ 105,888	$ 13,047	$ (92,744)	$ 18,063	$ (79,697)
Less: Preferred stock dividend	(997)						(2,489)
Less: Undistributed earnings allocable to preferred shareholders							(1,301)
Net income (loss) available to common stockholders	$ (5,745)				$ 13,047		$ 14,273	$ (79,697)
Weighted average basic number of common shares outstanding - basic	16,457				16,338		16,425	16,320
Basic net income (loss) per share of common share (in dollars per share)	$ (0.35)				$ 0.80		$ 0.87	$ (4.88)
Diluted:
Net income (loss) available to common stockholders - basic	$ (5,745)				$ 13,047		$ 14,273	$ (79,697)
Reallocation of undistributed earnings							7
Net income (loss) available to common stockholders - diluted	$ (5,745)				$ 13,047		$ 14,280	$ (79,697)
Weighted average basic number of common shares outstanding - basic	16,457				16,338		16,425	16,320
Common stock equivalent shares representing shares included upon Vesting of restricted shares					172		95
Weighted average diluted number of common shares outstanding - diluted	16,457				16,510		16,520	16,320
Diluted net income (loss) per share of common stock (in dollars per share)	$ (0.35)				$ 0.79		$ 0.86	$ (4.88)
Common stock equivalents excluded from computation of diluted earnings per share of common stock because of anti-dilutive effect	600				7,400		500	7,700

ADDITIONAL FINANCIAL STATEMEN_3

ADDITIONAL FINANCIAL STATEMENT INFORMATION (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022	May 31, 2022
Accounts receivable:
Oil, natural gas and natural gas liquids revenues	$ 19,853	$ 33,980
Joint interest accounts	1,779	3,201
Other	1,886	793
Total	23,518	37,974
Prepaids and other:
Prepaids	509	715
Funds in escrow	343	341
Other	197	75
Total	1,049	1,131
Other assets:
Investment in unconsolidated affiliate	1,477	1,561
Oil, natural gas and natural gas liquids revenues	24
Funds in escrow	538	527
Other	739	739
Total	2,778	2,827
Accounts payable and accrued liabilities:
Trade payables	17,884	42,919
Accrued oil and natural gas capital costs	1,928	19,911
Revenues and royalties payable	20,392	26,759
Accrued interest expense	104	160
Accrued employee compensation	1,190	2,300
Accrued lease operating expenses	7,388	8,005
Other	11	41
Total	$ 48,897	$ 100,095
Brazos Amine Treater, LLC [Member]
Accounts payable and accrued liabilities:
Equity interest			5%