Document And Entity Information
Document And Entity Information - shares | 6 Months Ended | |
Jun. 30, 2024 | Jul. 31, 2024 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Jun. 30, 2024 | |
Document Transition Report | false | |
Entity File Number | 1-32414 | |
Entity Registrant Name | W&T OFFSHORE, INC. | |
Entity Incorporation, State or Country Code | TX | |
Entity Tax Identification Number | 72-1121985 | |
Entity Address, Address Line One | 5718 Westheimer Road, Suite 700 | |
Entity Address, City or Town | Houston | |
Entity Address, State or Province | TX | |
Entity Address, Postal Zip Code | 77057-5745 | |
City Area Code | 713 | |
Local Phone Number | 626-8525 | |
Title of 12(b) Security | Common Stock, par value $0.00001 | |
Trading Symbol | WTI | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 147,182,248 | |
Entity Central Index Key | 0001288403 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2024 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Jun. 30, 2024 | Dec. 31, 2023 |
Current assets: | ||
Cash and cash equivalents | $ 123,375 | $ 173,338 |
Restricted cash | 4,417 | 4,417 |
Accounts receivable: | ||
Oil, NGL and natural gas sales | 71,547 | 52,080 |
Joint interest, net of allowance for credit losses of $11,358 and $11,130 as of June 30, 2024 and December 31, 2023, respectively | 20,478 | 15,480 |
Other | 2,223 | 2,218 |
Prepaid expenses and other current assets (Note 11) | 25,890 | 17,447 |
Total current assets | 247,930 | 264,980 |
Oil and natural gas properties and other, net of accumulated depreciation, depletion and amortization of $8,284,392 and $8,213,781 as of June 30, 2024 and December 31, 2023, respectively | 802,401 | 749,056 |
Restricted deposits for asset retirement obligations | 22,479 | 22,272 |
Deferred income taxes | 42,365 | 38,774 |
Other assets | 33,396 | 38,923 |
Total assets | 1,148,571 | 1,114,005 |
Current liabilities: | ||
Accounts payable | 89,129 | 78,857 |
Accrued liabilities (Note 11) | 29,004 | 31,978 |
Undistributed oil and natural gas proceeds | 63,150 | 42,134 |
Advances from joint interest partners | 2,565 | 2,962 |
Current portion of asset retirement obligations (Note 5) | 35,627 | 31,553 |
Current portion of long-term debt, net (Note 3) | 14,925 | 29,368 |
Total current liabilities | 234,400 | 216,852 |
Asset retirement obligations (Note 5) | 498,848 | 467,262 |
Long-term debt, net (Note 3) | 376,979 | 361,236 |
Other liabilities | 16,668 | 19,420 |
Commitments and contingencies (Note 6) | 16,671 | 18,043 |
Shareholders' equity: | ||
Preferred stock, $0.00001 par value; 20,000 shares authorized; none issued at June 30, 2024 and December 31, 2023 | ||
Common stock, $0.00001 par value; 400,000 shares authorized; 150,032 issued and 147,163 outstanding at June 30, 2024; 149,450 issued and 146,581 outstanding at December 31, 2023 | 2 | 1 |
Additional paid-in capital | 589,678 | 586,014 |
Retained deficit | (560,508) | (530,656) |
Treasury stock, at cost; 2,869 shares | (24,167) | (24,167) |
Total shareholders' equity | 5,005 | 31,192 |
Total liabilities and shareholders' equity | $ 1,148,571 | $ 1,114,005 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parentheticals) - USD ($) shares in Thousands, $ in Thousands | Jun. 30, 2024 | Dec. 31, 2023 |
Statement of Financial Position [Abstract] | ||
Joint interest, allowance for credit loss | $ 11,358 | $ 11,130 |
Oil and natural gas properties and other, accumulated depreciation, depletion and amortization | $ 8,284,392 | $ 8,213,781 |
Preferred stock, par value (in dollars per share) | $ 0.00001 | $ 0.00001 |
Preferred stock, shares authorized (in shares) | 20,000 | 20,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.00001 | $ 0.00001 |
Common stock, shares authorized (in shares) | 400,000 | 400,000 |
Common stock, shares issued (in shares) | 150,032 | 149,450 |
Common stock, shares outstanding (in shares) | 147,163 | 146,581 |
Treasury stock, shares (in shares) | 2,869 | 2,869 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Revenues: | ||||
Total revenues | $ 142,757 | $ 126,181 | $ 283,544 | $ 257,906 |
Operating expenses: | ||||
Lease operating expenses | 73,987 | 66,021 | 144,817 | 131,207 |
Gathering, transportation and production taxes | 8,578 | 6,802 | 16,118 | 12,938 |
Depreciation, depletion, and amortization | 36,674 | 28,177 | 70,611 | 50,801 |
Asset retirement obligations accretion | 8,400 | 7,717 | 16,369 | 15,227 |
General and administrative expenses | 21,354 | 17,393 | 41,869 | 37,312 |
Total operating expenses | 148,993 | 126,110 | 289,784 | 247,485 |
Operating (loss) income | (6,236) | 71 | (6,240) | 10,421 |
Interest expense, net | 10,164 | 10,323 | 20,236 | 25,036 |
Derivative loss (gain), net | 2,374 | (829) | (2,503) | (40,069) |
Other expense (income), net | 1,250 | (311) | 6,480 | (78) |
(Loss) income before income taxes | (20,024) | (9,112) | (30,453) | 25,532 |
Income tax (benefit) expense | (4,636) | 2,997 | (3,591) | 11,636 |
Net (loss) income | $ (15,388) | $ (12,109) | $ (26,862) | $ 13,896 |
Net (loss) income per common share: | ||||
Basic (in dollars per share) | $ (0.10) | $ (0.08) | $ (0.18) | $ 0.09 |
Diluted (in dollars per share) | $ (0.10) | $ (0.08) | $ (0.18) | $ 0.09 |
Weighted average common shares outstanding: | ||||
Basic (in shares) | 146,943 | 146,452 | 146,900 | 146,435 |
Diluted (in shares) | 146,943 | 146,452 | 146,900 | 149,045 |
Oil | ||||
Revenues: | ||||
Total revenues | $ 110,965 | $ 89,982 | $ 217,980 | $ 186,982 |
NGLs | ||||
Revenues: | ||||
Total revenues | 8,160 | 10,385 | 15,629 | 18,180 |
Natural gas | ||||
Revenues: | ||||
Total revenues | 21,910 | 23,438 | 43,526 | 48,242 |
Other | ||||
Revenues: | ||||
Total revenues | $ 1,722 | $ 2,376 | $ 6,409 | $ 4,502 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Changes in Shareholders' Equity - USD ($) shares in Thousands, $ in Thousands | Common Stock | Additional Paid-in Capital | Retained Deficit | Treasury Stock | Total |
Balances beginning at Dec. 31, 2022 | $ 1 | $ 576,588 | $ (544,788) | $ (24,167) | $ 7,634 |
Balances beginning (in shares) at Dec. 31, 2022 | 146,133 | ||||
Balances beginning (in shares) at Dec. 31, 2022 | 2,869 | ||||
Share-based compensation | 4,009 | 4,009 | |||
Stock issued (in shares) | 348 | ||||
Shares withheld related to net settlement of equity awards | (748) | (748) | |||
Net Income (Loss) | 13,896 | 13,896 | |||
Balances Ending at Jun. 30, 2023 | $ 1 | 579,849 | (530,892) | $ (24,167) | 24,791 |
Balances Ending (in shares) at Jun. 30, 2023 | 146,481 | ||||
Balances Ending (in shares) at Jun. 30, 2023 | 2,869 | ||||
Balances beginning at Mar. 31, 2023 | $ 1 | 577,787 | (518,783) | $ (24,167) | 34,838 |
Balances beginning (in shares) at Mar. 31, 2023 | 146,461 | ||||
Balances beginning (in shares) at Mar. 31, 2023 | 2,869 | ||||
Share-based compensation | 2,087 | 2,087 | |||
Stock issued (in shares) | 20 | ||||
Shares withheld related to net settlement of equity awards | (25) | (25) | |||
Net Income (Loss) | (12,109) | (12,109) | |||
Balances Ending at Jun. 30, 2023 | $ 1 | 579,849 | (530,892) | $ (24,167) | 24,791 |
Balances Ending (in shares) at Jun. 30, 2023 | 146,481 | ||||
Balances Ending (in shares) at Jun. 30, 2023 | 2,869 | ||||
Balances beginning at Dec. 31, 2023 | $ 1 | 586,014 | (530,656) | $ (24,167) | $ 31,192 |
Balances beginning (in shares) at Dec. 31, 2023 | 146,581 | ||||
Balances beginning (in shares) at Dec. 31, 2023 | 2,869 | 2,869 | |||
Cash dividends | (2,990) | $ (2,990) | |||
Share-based compensation | 4,418 | 4,418 | |||
Stock issued | $ 1 | 1 | |||
Stock issued (in shares) | 581 | ||||
Shares withheld related to net settlement of equity awards | (754) | (754) | |||
Net Income (Loss) | (26,862) | (26,862) | |||
Balances Ending at Jun. 30, 2024 | $ 2 | 589,678 | (560,508) | $ (24,167) | $ 5,005 |
Balances Ending (in shares) at Jun. 30, 2024 | 147,162 | ||||
Balances Ending (in shares) at Jun. 30, 2024 | 2,869 | 2,869 | |||
Balances beginning at Mar. 31, 2024 | $ 1 | 588,563 | (543,637) | $ (24,167) | $ 20,760 |
Balances beginning (in shares) at Mar. 31, 2024 | 146,857 | ||||
Balances beginning (in shares) at Mar. 31, 2024 | 2,869 | ||||
Cash dividends | (1,483) | (1,483) | |||
Share-based compensation | 1,386 | 1,386 | |||
Stock issued | $ 1 | 1 | |||
Stock issued (in shares) | 305 | ||||
Shares withheld related to net settlement of equity awards | (271) | (271) | |||
Net Income (Loss) | (15,388) | (15,388) | |||
Balances Ending at Jun. 30, 2024 | $ 2 | $ 589,678 | $ (560,508) | $ (24,167) | $ 5,005 |
Balances Ending (in shares) at Jun. 30, 2024 | 147,162 | ||||
Balances Ending (in shares) at Jun. 30, 2024 | 2,869 | 2,869 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2024 | Jun. 30, 2023 | |
Operating activities: | ||
Net (loss) income | $ (26,862) | $ 13,896 |
Adjustments to reconcile net (loss) income to net cash provided by operating activities: | ||
Depreciation, depletion, amortization and accretion | 86,980 | 66,028 |
Share-based compensation | 4,418 | 4,009 |
Amortization and write off of debt issuance costs | 2,336 | 4,363 |
Derivative loss (gain), net | (2,503) | (40,069) |
Derivative cash settlements, net | 4,957 | (4,427) |
Deferred income (benefit) taxes | (3,591) | 11,580 |
Changes in operating assets and liabilities: | ||
Accounts receivable | (24,470) | 24,929 |
Prepaid expenses and other current assets | (5,744) | 26,992 |
Accounts payable, accrued liabilities and other | 25,564 | (45,828) |
Asset retirement obligation settlements | (11,997) | (11,841) |
Net cash provided by operating activities | 49,088 | 49,632 |
Investing activities: | ||
Investment in oil and natural gas properties and equipment | (13,656) | (25,337) |
Acquisition of property interests | (80,635) | |
Purchase of corporate aircraft | (8,983) | |
Purchases of furniture, fixtures and other | (97) | (218) |
Net cash used in investing activities | (94,388) | (34,538) |
Financing activities: | ||
Proceeds from issuance of 11.75% Notes Senior Second Lien Notes | 275,000 | |
Repayment of 9.75% Second Senior Lien Notes | (552,460) | |
Repayments of Term Loan | (19,181) | |
Repayments of TVPX Loan | (550) | (183) |
Debt issuance costs | (405) | (7,252) |
Payment of dividends | (2,954) | |
Other | (754) | (748) |
Net cash used in financing activities | (4,663) | (304,824) |
Change in cash, cash equivalents and restricted cash | (49,963) | (289,730) |
Cash, cash equivalents and restricted cash, beginning of year | 177,755 | 465,774 |
Cash, cash equivalents and restricted cash, end of period | $ 127,792 | $ 176,044 |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Cash Flows (Parentheticals) | Jun. 30, 2024 | Jun. 30, 2023 |
11.75% Senior Second Lien Notes due 2026 | ||
Debt instrument, interest rate, stated percentage | 11.75% | 11.75% |
9.75% Second Senior Lien Notes | ||
Debt instrument, interest rate, stated percentage | 9.75% | 9.75% |
NATURE OF OPERATIONS AND BASIS
NATURE OF OPERATIONS AND BASIS OF PRESENTATION | 6 Months Ended |
Jun. 30, 2024 | |
Notes to Financial Statements | |
NATURE OF OPERATIONS AND BASIS OF PRESENTATION | NOTE 1 — NATURE OF OPERATIONS AND Nature of Operations W&T Offshore, Inc. (with subsidiaries referred to herein as the “Company”) is an independent oil and natural gas producer with substantially all of its operations offshore in the Gulf of Mexico. The Company is active in the exploration, development and acquisition of oil and natural gas properties. The Company operates in one reportable segment. Basis of Presentation The accompanying unaudited condensed consolidated financial statements include the accounts of the Company, its wholly-owned subsidiaries and an interest in Monza Energy LLC (“Monza”), which is accounted for under the proportional consolidation method. All intercompany accounts and transactions have been eliminated in consolidation. These condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). Accordingly, certain information and disclosures normally included in annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) have been condensed or omitted. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for interim periods are not necessarily indicative of the results that may be expected for the entire year. These unaudited condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes included in Part II, Item 8. Financial Statements and Supplementary Data Certain reclassifications have been made to the prior year’s condensed consolidated financial statements to conform to the current year’s presentation. On the Condensed Consolidated Balance Sheets, the Company has combined Income tax payable Accrued liabilities Deferred income taxes Other liabilities. Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates. |
ACQUISITION
ACQUISITION | 6 Months Ended |
Jun. 30, 2024 | |
ACQUISITION | |
ACQUISITION | NOTE 2 — On December 13, 2023, the Company entered into a purchase and sale agreement to acquire rights, titles and interest in and to certain leases, wells and personal property in the central shelf region of the Gulf of Mexico, among other assets, for $72.0 million. The transaction closed on January 16, 2024 for $77.3 million (including closing fees and other transaction costs) and was funded using cash on hand. The Company also assumed the related asset retirement obligations (“AROs”) associated with these assets. The acquisition was accounted for as an asset acquisition, which requires that the total purchase price, including transaction costs, be allocated to the assets acquired and the liabilities assumed based on their relative fair values. The fair value measurements of the oil and natural gas properties acquired and ARO assumed were derived utilizing an income approach and based, in part, on significant inputs not observable in the market. These inputs represent Level 3 measurements in the fair value hierarchy and include, but are not limited to, estimates of reserves, future operating and development costs, future commodity prices, estimated future cash flows and appropriate discount rates. These inputs required significant judgments and estimates by the Company’s management at the time of the valuation. The following table presents the Company’s allocation of total purchase consideration to the identifiable assets acquired and liabilities assumed based on the fair values on the date of acquisition (in thousands): January 2024 Oil and natural gas properties and other, net $ 94,970 Asset retirement obligations (17,647) Allocated purchase price $ 77,323 In February 2024, the Company received a final settlement statement for its September 2023 acquisition of working interest in certain oil and natural gas producing properties in the central and eastern shelf region of the Gulf of Mexico and recorded an additional $3.3 million of oil and natural gas properties. |
DEBT
DEBT | 6 Months Ended |
Jun. 30, 2024 | |
Notes to Financial Statements | |
DEBT | NOTE 3 — The components comprising the Company’s debt are presented in the following table (in thousands): June 30, December 31, 2024 2023 Term Loan: Principal $ 114,159 $ 114,159 Unamortized debt issuance costs (2,499) (3,052) Total 111,660 111,107 11.75% Senior Second Lien Notes due 2026: Principal 275,000 275,000 Unamortized debt issuance costs (4,019) (5,090) Total 270,981 269,910 TVPX Loan: Principal 10,475 11,025 Unamortized discount (1,027) (1,294) Unamortized debt issuance costs (185) (144) Total 9,263 9,587 Total debt, net 391,904 390,604 Less current portion, net (14,925) (29,368) Long-term debt, net $ 376,979 $ 361,236 On March 17, 2024, the term loan provided for by the credit agreement entered into by Aquasition LLC and Aquasition II LLC (the “Term Loan”) was amended to provide for (i) the deferral of $30.1 million of principal repayments during 2024; (ii) the resumption of principal repayments in the first quarter of 2025 with the option, but not obligation, to catch up on deferred amortization through excess cash flow sweep; (iii) the payment of cash interest each quarter on the remaining principal balance; (iv) the payment of an amendment fee of $0.2 million to be paid in four quarterly installments of $50,000 each, starting in the first quarter of 2024; and (v) the modification of the optional prepayment schedule as follows: redemption at 103% of par from May 2024 to May 2026, redemption at 102% of par from May 2026 up to May 2027, and 101% of par from May 2027 up to maturity in May 2028. The premium will be applicable to the aggregate principal amount outstanding at the time of any optional redemption. During the six months ended June 30, 2024, the Company entered into a series of amendments to extend the maturity date of the Sixth Amended and Restated Credit Agreement (the “Credit Agreement”). Most recently, the Company entered into the Nineteenth Amendment on June 28, 2024 to (i) extend the maturity date to December 31, 2024, (ii) prohibit the use of loan proceeds to pay other Indebtedness (as defined in the Credit Agreement) and (iii) lower the excess cash balance sweep threshold. As of June 30, 2024, the borrowing base under the Credit Agreement was $50.0 million and there were no borrowings outstanding. In addition, no borrowings had been incurred under the Credit Agreement during the six months ended June 30, 2024. As of both June 30, 2024 and December 31, 2023, the Company had $4.4 million outstanding in letters of credit which have been cash collateralized. As of June 30, 2024, the Company was in compliance with all applicable covenants. |
FINANCIAL INSTRUMENTS
FINANCIAL INSTRUMENTS | 6 Months Ended |
Jun. 30, 2024 | |
Notes to Financial Statements | |
FINANCIAL INSTRUMENTS | NOTE 4 — The Company’s financial instruments consist of cash and cash equivalents, restricted cash, accounts receivable, accounts payable, accrued liabilities, derivative instruments and debt. Except for derivative instruments and debt, the carrying amount of the Company’s financial instruments approximates fair value due to the short-term, highly liquid nature of these instruments. Derivative Instruments The following table reflects the contracted volumes and weighted average prices under the terms of the Company’s open derivative contracts as of June 30, 2024: Average Instrument Daily Total Weighted Weighted Weighted Production Period Type Volumes Volumes Strike Price Put Price Call Price Natural Gas - Henry Hub (NYMEX) (Mmbtu) (1) (Mmbtu) (1) ($/Mmbtu) ($/Mmbtu) ($/Mmbtu) August 2024 - Dec 2024 calls 65,000 9,945,000 $ — $ — $ 6.13 Jan 2025 - Mar 2025 calls 62,000 5,580,000 $ — $ — $ 5.50 August 2024 - Dec 2024 swaps 65,359 10,000,000 $ 2.45 $ — $ — Jan 2025 - Mar 2025 swaps 63,333 5,700,000 $ 2.72 $ — $ — Apr 2025 - Dec 2025 puts 62,182 17,100,000 $ — $ 2.27 $ — Jan 2026 - Dec 2026 puts 55,890 20,400,000 $ — $ 2.35 $ — Jan 2027 - Dec 2027 puts 52,603 19,200,000 $ — $ 2.37 $ — Jan 2028 - Apr 2028 puts 49,587 6,000,000 $ — $ 2.50 $ — (1) MMbtu – Million British Thermal Units The Company has elected not to designate its derivative instruments contracts for hedge accounting. Accordingly, commodity derivatives are recorded on the Condensed Consolidated Balance Sheets at fair value with settlements of such contracts, and changes in the unrealized fair value, recorded as Derivative loss (gain), net on the Condensed Consolidated Statements of Operations in each period presented. The fair value of the Company’s derivative financial instruments was recorded in the Condensed Consolidated Balance Sheets as follows (in thousands): June 30, December 31, 2024 2023 Prepaid expenses and other current assets $ 1,961 $ 1,180 Other assets 6,755 10,068 Accrued liabilities 8,945 6,267 Other liabilities — 2,756 The Company measures the fair value of its derivative instruments by applying the income approach, using models with inputs that are classified within Level 2 of the valuation hierarchy. The income approach converts expected future cash flows to a present value amount based on market expectations. The inputs used for the fair value measurement of derivative financial instruments are the exercise price, the expiration date, the settlement date, notional quantities, the implied volatility, the discount curve with spreads and published commodity future prices. Although the Company has master netting arrangements with its counterparties, t The impact of commodity derivative contracts on the Condensed Consolidated Statements of Operations were as follows (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 Realized (gain) loss $ (364) $ 300 $ (4,119) $ 530 Unrealized loss (gain) 2,738 (1,129) 1,616 (40,599) Derivative loss (gain), net $ 2,374 $ (829) $ (2,503) $ (40,069) Debt The following table presents the net values and estimated fair values of the Company’s debt (in thousands): June 30, 2024 December 31, 2023 Net Value Fair Value Net Value Fair Value Term Loan $ 111,660 $ 108,371 $ 111,107 $ 108,467 11.75% Notes 270,981 282,923 269,910 283,443 TVPX Loan 9,263 9,776 9,587 10,156 Total $ 391,904 $ 401,070 $ 390,604 $ 402,066 The fair value of the TVPX Loan and the Term Loan were measured using a discounted cash flows model and current market rates. The fair value of the 11.75% Notes was measured using quoted prices, although the market is not a highly liquid market. The fair value of debt was classified as Level 2 within the valuation hierarchy. |
ASSET RETIREMENT OBLIGATIONS
ASSET RETIREMENT OBLIGATIONS | 6 Months Ended |
Jun. 30, 2024 | |
Notes to Financial Statements | |
ASSET RETIREMENT OBLIGATIONS | NOTE 5 — AROs represent the estimated present value of the amount incurred to plug, abandon and remediate the Company’s properties at the end of their productive lives. A summary of the changes to ARO is as follows (in thousands): Six Months Ended June 30, 2024 2023 Asset retirement obligations, beginning of period $ 498,815 $ 466,430 Liabilities settled (11,997) (11,841) Accretion expense 16,369 15,227 Liabilities acquired 17,647 — Liabilities incurred — 113 Revisions of estimated liabilities 13,641 10,903 Asset retirement obligations, end of period 534,475 480,832 Less: Current portion (35,627) (37,763) Long-term $ 498,848 $ 443,069 |
CONTINGENCIES
CONTINGENCIES | 6 Months Ended |
Jun. 30, 2024 | |
Notes to Financial Statements | |
CONTINGENCIES | NOTE 6 — Appeal with the Office of Natural Resources Revenue In 2009 , , million of the reductions taken. As of June 30, 2024, the Company has accrued The Company has continued to pursue its legal rights and, at present, the case is in front of the U.S. District Court for the Eastern District of Louisiana where both parties have filed cross-motions for summary judgment and opposition briefs. The Company has filed a Reply in support of its Motion for Summary Judgment, and the government has in turn filed its Reply brief. With briefing now completed, the Company is waiting for the district court’s ruling on the merits. ONRR Audit of Historical Refund Claims In 2023, the Company received notification from the ONRR regarding results of an audit performed on the Company’s historical refund claims taken on various properties for alleged royalties owed to the ONRR. The review process is ongoing, and the Company does not believe any accrual is necessary at this time. Contingent Decommissioning Obligations The Company may be subject to retained liabilities with respect to certain divested property interests by operation of law. Certain counterparties in past divestiture transactions or third parties in existing leases that have filed for bankruptcy protection or undergone associated reorganizations may not be able to perform required abandonment obligations. Due to operation of law, the Company may be required to assume decommissioning obligations for those interests. The Company may be held jointly and severally liable for the decommissioning of various facilities and related wells. The Company no longer owns these assets, nor are they related to current operations. During the six months ended June 30, 2024, the Company incurred $8.4 million in costs related to these decommissioning obligations and reassessed the existing decommissioning obligations, recording an additional $7.0 million. As of June 30, 2024, the remaining loss contingency recorded related to the anticipated decommissioning obligations was $16.7 million. Although it is reasonably possible that the Company could receive state or federal decommissioning orders in the future or be notified of defaulting third parties in existing leases, the Company cannot predict with certainty, if, how or when such orders or notices will be resolved or estimate a possible loss or range of loss that may result from such orders. However, the Company could incur judgments, enter into settlements or revise the Company’s opinion regarding the outcome of certain notices or matters, and such developments could have a material adverse effect on the Company’s results of operations in the period in which the amounts are accrued and the Company’s cash flows in the period in which the amounts are paid. To the extent the Company does incur costs associated with these properties in future periods, the Company intends to seek contribution from other parties that owned an interest in the facilities. Other Claims In the ordinary course of business, the Company is a party to various pending or threatened claims and complaints seeking damages or other remedies concerning commercial operations and other matters. In addition, claims or contingencies may arise related to matters occurring prior to the Company’s acquisition of properties or related to matters occurring subsequent to the Company’s sale of properties. In certain cases, the Company has indemnified the sellers of properties acquired, and in other cases, has indemnified the buyers of properties sold. The Company is also subject to federal and state administrative proceedings conducted in the ordinary course of business including matters related to alleged royalty underpayments on certain federal-owned properties. Although the Company can give no assurance about the outcome of pending legal and federal or state administrative proceedings and the effect such an outcome may have, the Company believes that any ultimate liability resulting from the outcome of such proceedings, to the extent not otherwise provided for or covered by insurance, will not have a material adverse effect on the consolidated financial position, results of operations or liquidity of the Company. |
INVESTMENT IN MONZA
INVESTMENT IN MONZA | 6 Months Ended |
Jun. 30, 2024 | |
Notes to Financial Statements | |
INVESTMENT IN MONZA | NOTE 7 — INVESTMENT IN MONZA In March 2018, the Company and other members formed and funded Monza, which jointly participates with the Company in the exploration, drilling and development of certain drilling projects (“Joint Venture Drilling Program”) in the Gulf of Mexico. The total commitments by all members, including the Company’s commitment to fund its retained interest in Monza projects held outside of Monza, was $361.4 million. The Company contributed 88.94% of its working interest in certain undeveloped drilling projects to Monza and retained 11.06% of its working interest. The Joint Venture Drilling Program is structured so that the Company initially received an aggregate of 30.0% of the revenues less expenses, through the direct ownership from the retained working interest in the Monza projects and the Company’s indirect interest through its interest in Monza, for contributing 20.0% of the estimated total well costs plus associated leases and providing access to available infrastructure at agreed-upon rates. The members of Monza are third-party investors, the Company and an entity owned and controlled by the Company’s Chief Executive Officer (“CEO”). The entity affiliated with the Company’s CEO invested as a minority investor on the same terms and conditions as the third-party investors. The Company’s interest in Monza is considered to be a variable interest that is proportionally consolidated. The Company does not fully consolidate Monza because the Company is not considered the primary beneficiary of Monza. The following table presents the amounts recorded by the Company on the Condensed Consolidated Balance Sheets related to the consolidation of the proportional interest in Monza’s operations (in thousands): June 30, December 31, 2024 2023 Working capital $ 913 $ 1,159 Oil and natural gas properties and other, net 29,911 31,805 Other assets 12,284 11,694 Asset retirement obligations 642 593 The following table presents the amounts recorded by the Company in the Condensed (i Six Months Ended June 30, 2024 2023 Total revenues $ 5,700 $ 6,018 Total operating expenses 3,636 4,623 Interest income 111 104 As required, the Company may call on Monza to provide cash to fund its portion of certain projects in advance of capital expenditure spending. As of June 30, 2024 and December 31, 2023, the unused advances were $2.6 million and $2.7 million, respectively, which are included in Advances from joint interest partners . During the six months ended June 30, 2024, Monza paid cash distributions of $18.0 million, of which $3.8 million was paid to the Company. |
STOCKHOLDERS' EQUITY
STOCKHOLDERS' EQUITY | 6 Months Ended |
Jun. 30, 2024 | |
Stockholders' Equity | |
STOCKHOLDERS' EQUITY | NOTE 8 — On March 5, 2024, the Company’s board of directors declared a regular quarterly dividend of $0.01 per share of common stock for the first quarter of 2024. The dividend of $1.5 million was paid on March 25, 2024 to stockholders of record at the close of business on March 18, 2024. On May 10, 2024, the Company’s board of directors declared a regular quarterly dividend of $0.01 per share of common stock for the second quarter of 2024. The dividend of $1.5 million was paid on May 31, 2024 to stockholders of record at the close of business on May 24, 2024. On August 6, 2024, the Company’s board of directors declared a regular quarterly dividend of $0.01 per share of common stock for the third quarter of 2024. The dividend is to be paid on August 27, 2024 to stockholders of record at the close of business on August 20, 2024. |
INCOME TAXES
INCOME TAXES | 6 Months Ended |
Jun. 30, 2024 | |
Notes to Financial Statements | |
INCOME TAXES | NOTE 9 — The Company records income taxes for interim periods based on an estimated annual effective tax rate. The estimated annual effective rate is recomputed on a quarterly basis and may fluctuate due to changes in forecasted annual operating income, positive or negative changes to the valuation allowance for net deferred tax assets and changes to actual or forecasted permanent book to tax differences. The Company’s effective tax rate for the three and six months ended June 30, 2024 was 23.1% and 11.8%, respectively. The difference between the effective tax rate and the federal statutory rate was primarily due to the impact of nondeductible compensation and adjustments to the valuation allowance. The Company’s effective tax rate for the three months ended June 30, 2023 is not meaningful primarily as a result of changes in the valuation allowance on the Company’s deferred tax assets. The Company’s effective tax rate for the six months ended June 30, 2023 was 45.6%. The difference between the effective tax rate and the federal statutory rate was primarily due to the impact of state income taxes, nondeductible compensation, and adjustments to the valuation allowance. As of June 30, 2024 and December 31, 2023, the Company had a valuation allowance of $27.1 million and $23.2 million, respectively, primarily related to state net operating losses and the disallowed interest expense limitation carryover. At each reporting date, the Company considers all available positive and negative evidence to evaluate whether its deferred tax assets are more likely than not to be realized. |
NET (LOSS) INCOME PER SHARE
NET (LOSS) INCOME PER SHARE | 6 Months Ended |
Jun. 30, 2024 | |
Notes to Financial Statements | |
NET (LOSS) INCOME PER SHARE | NOTE 10 — NET (LOSS) INCOME PER SHARE The following table presents the calculation of basic and diluted net (loss) income per common share (in thousands, except per share amounts): Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 Net (loss) income $ (15,388) $ (12,109) $ (26,862) $ 13,896 Weighted average common shares outstanding - basic 146,943 146,452 146,900 146,435 Dilutive effect of securities — — — 2,610 Weighted average common shares outstanding - diluted 146,943 146,452 146,900 149,045 Net (loss) income per common share: Basic $ (0.10) $ (0.08) $ (0.18) $ 0.09 Diluted (0.10) (0.08) (0.18) 0.09 Shares excluded due to being anti-dilutive 1,724 2,909 1,724 — |
OTHER SUPPLEMENTAL INFORMATION
OTHER SUPPLEMENTAL INFORMATION | 6 Months Ended |
Jun. 30, 2024 | |
Notes to Financial Statements | |
OTHER SUPPLEMENTAL INFORMATION | NOTE 11 — OTHER SUPPLEMENTAL INFORMATION Condensed Consolidated Balance Sheet Details Prepaid expenses and other current assets consisted of the following (in thousands): June 30, December 31, 2024 2023 Derivatives $ 1,961 $ 1,180 Insurance/bond premiums 12,205 6,631 Prepaid deposits related to royalties 8,562 7,872 Prepayments to vendors 2,288 1,492 Other 874 272 Prepaid expenses and other current assets $ 25,890 $ 17,447 Accrued liabilities consisted of the following (in thousands): June 30, December 31, 2024 2023 Accrued interest $ 13,479 $ 13,479 Accrued salaries/payroll taxes/benefits 3,258 9,473 Operating lease liabilities 1,484 1,455 Derivatives 8,945 6,267 Other 1,838 1,304 Total accrued liabilities $ 29,004 $ 31,978 Condensed Consolidated Statements of Cash Flows Information Supplemental statements of cash flows information consisted of the following (in thousands): June 30, December 31, 2024 2023 Cash and cash equivalents $ 123,375 $ 173,338 Restricted cash 4,417 4,417 Cash, cash equivalents and restricted cash 127,792 177,755 Six Months Ended June 30, 2024 2023 Non-cash investing activities: Accruals of property and equipment 5,440 4,297 Dividends declared but not paid on unvested share-based awards 36 — ARO - acquisitions, additions and revisions, net 31,288 11,016 |
SUBSIDIARY BORROWERS
SUBSIDIARY BORROWERS | 6 Months Ended |
Jun. 30, 2024 | |
SUBSIDIARY BORROWERS | |
SUBSIDIARY BORROWERS | NOTE 12 — SUBSIDIARY BORROWERS Aquasition LLC and Aquasition II, LLC (collectively, the “Subsidiary Borrowers”) are indirect, wholly-owned subsidiaries of the Company. Note 3 – Debt The assets of the Subsidiary Borrowers are not available to satisfy the debt or contractual obligations of any other entities, including debt securities or other contractual obligations of the Company, and the Subsidiary Borrowers do not bear any liability for the indebtedness or other contractual obligations of any other entities, and vice versa. The following table presents the amounts recorded by the Company on the Condensed Consolidated Balance Sheets related to the consolidation of Aquasition Energy LLC, the parent of the Subsidiary Borrowers (the “Subsidiary Parent”), and the Subsidiary Borrowers (in thousands): June 30, December 31, 2024 2023 Assets: Cash and cash equivalents $ 4,453 $ 600 Receivables: Oil and natural gas sales 11,630 19,171 Joint interest, net (21,319) (33,151) Prepaid expenses and other current assets 834 612 Oil and natural gas properties and other, net 285,393 287,313 Other assets 5,689 8,097 Liabilities: Accounts payable 2,979 4,473 Accrued liabilities 9,830 7,152 Undistributed oil and natural gas proceeds 5,747 4,359 Current portion of long-term debt, net 14,400 28,872 Asset retirement obligations 70,914 67,771 Long-term debt, net 97,260 82,317 Other liabilities 4,261 6,749 The following table presents the amounts recorded by the Company in the Condensed Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 Total revenues $ 20,698 $ 25,437 $ 40,966 $ 46,560 Total operating expenses 20,386 30,443 39,260 50,490 Interest expense, net 2,209 3,229 4,451 5,411 Derivative loss (gain), net 2,446 (6,012) (3,129) (52,389) |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Pay vs Performance Disclosure | ||||
Net Income (Loss) | $ (15,388) | $ (12,109) | $ (26,862) | $ 13,896 |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended |
Jun. 30, 2024 | |
Trading Arrangements, by Individual | |
Rule 10b5-1 Arrangement Adopted | false |
Non-Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Non-Rule 10b5-1 Arrangement Terminated | false |
NATURE OF OPERATIONS AND BASI_2
NATURE OF OPERATIONS AND BASIS OF PRESENTATION (Policies) | 6 Months Ended |
Jun. 30, 2024 | |
NATURE OF OPERATIONS AND BASIS OF PRESENTATION | |
Basis of Presentation | Basis of Presentation The accompanying unaudited condensed consolidated financial statements include the accounts of the Company, its wholly-owned subsidiaries and an interest in Monza Energy LLC (“Monza”), which is accounted for under the proportional consolidation method. All intercompany accounts and transactions have been eliminated in consolidation. These condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). Accordingly, certain information and disclosures normally included in annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) have been condensed or omitted. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for interim periods are not necessarily indicative of the results that may be expected for the entire year. These unaudited condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes included in Part II, Item 8. Financial Statements and Supplementary Data Certain reclassifications have been made to the prior year’s condensed consolidated financial statements to conform to the current year’s presentation. On the Condensed Consolidated Balance Sheets, the Company has combined Income tax payable Accrued liabilities Deferred income taxes Other liabilities. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates. |
ACQUISITION (Tables)
ACQUISITION (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
ACQUISITION | |
Schedule of the preliminary allocation of total purchase consideration | The following table presents the Company’s allocation of total purchase consideration to the identifiable assets acquired and liabilities assumed based on the fair values on the date of acquisition (in thousands): January 2024 Oil and natural gas properties and other, net $ 94,970 Asset retirement obligations (17,647) Allocated purchase price $ 77,323 |
DEBT (Tables)
DEBT (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Notes Tables | |
Schedule of Debt Instruments | The components comprising the Company’s debt are presented in the following table (in thousands): June 30, December 31, 2024 2023 Term Loan: Principal $ 114,159 $ 114,159 Unamortized debt issuance costs (2,499) (3,052) Total 111,660 111,107 11.75% Senior Second Lien Notes due 2026: Principal 275,000 275,000 Unamortized debt issuance costs (4,019) (5,090) Total 270,981 269,910 TVPX Loan: Principal 10,475 11,025 Unamortized discount (1,027) (1,294) Unamortized debt issuance costs (185) (144) Total 9,263 9,587 Total debt, net 391,904 390,604 Less current portion, net (14,925) (29,368) Long-term debt, net $ 376,979 $ 361,236 |
FINANCIAL INSTRUMENTS (Tables)
FINANCIAL INSTRUMENTS (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Notes Tables | |
Schedule of Contracted Volumes and Weighted Average Prices of Open Derivative Contracts | Average Instrument Daily Total Weighted Weighted Weighted Production Period Type Volumes Volumes Strike Price Put Price Call Price Natural Gas - Henry Hub (NYMEX) (Mmbtu) (1) (Mmbtu) (1) ($/Mmbtu) ($/Mmbtu) ($/Mmbtu) August 2024 - Dec 2024 calls 65,000 9,945,000 $ — $ — $ 6.13 Jan 2025 - Mar 2025 calls 62,000 5,580,000 $ — $ — $ 5.50 August 2024 - Dec 2024 swaps 65,359 10,000,000 $ 2.45 $ — $ — Jan 2025 - Mar 2025 swaps 63,333 5,700,000 $ 2.72 $ — $ — Apr 2025 - Dec 2025 puts 62,182 17,100,000 $ — $ 2.27 $ — Jan 2026 - Dec 2026 puts 55,890 20,400,000 $ — $ 2.35 $ — Jan 2027 - Dec 2027 puts 52,603 19,200,000 $ — $ 2.37 $ — Jan 2028 - Apr 2028 puts 49,587 6,000,000 $ — $ 2.50 $ — (1) MMbtu – Million British Thermal Units |
Schedule of Derivatives Instruments Statements of Financial Performance and Financial Position, Location | The fair value of the Company’s derivative financial instruments was recorded in the Condensed Consolidated Balance Sheets as follows (in thousands): June 30, December 31, 2024 2023 Prepaid expenses and other current assets $ 1,961 $ 1,180 Other assets 6,755 10,068 Accrued liabilities 8,945 6,267 Other liabilities — 2,756 The impact of commodity derivative contracts on the Condensed Consolidated Statements of Operations were as follows (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 Realized (gain) loss $ (364) $ 300 $ (4,119) $ 530 Unrealized loss (gain) 2,738 (1,129) 1,616 (40,599) Derivative loss (gain), net $ 2,374 $ (829) $ (2,503) $ (40,069) |
Schedule of Net Values and Estimated Fair Values of Debt Instruments | The following table presents the net values and estimated fair values of the Company’s debt (in thousands): June 30, 2024 December 31, 2023 Net Value Fair Value Net Value Fair Value Term Loan $ 111,660 $ 108,371 $ 111,107 $ 108,467 11.75% Notes 270,981 282,923 269,910 283,443 TVPX Loan 9,263 9,776 9,587 10,156 Total $ 391,904 $ 401,070 $ 390,604 $ 402,066 |
ASSET RETIREMENT OBLIGATIONS (T
ASSET RETIREMENT OBLIGATIONS (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Notes Tables | |
Schedule of Changes in Asset Retirement Obligations | A summary of the changes to ARO is as follows (in thousands): Six Months Ended June 30, 2024 2023 Asset retirement obligations, beginning of period $ 498,815 $ 466,430 Liabilities settled (11,997) (11,841) Accretion expense 16,369 15,227 Liabilities acquired 17,647 — Liabilities incurred — 113 Revisions of estimated liabilities 13,641 10,903 Asset retirement obligations, end of period 534,475 480,832 Less: Current portion (35,627) (37,763) Long-term $ 498,848 $ 443,069 |
INVESTMENT IN MONZA (Tables)
INVESTMENT IN MONZA (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
INVESTMENT IN MONZA | |
Schedule of Condensed Consolidated Balance Sheet related to the consolidation of the proportional interest in Monza's operations | The following table presents the amounts recorded by the Company on the Condensed Consolidated Balance Sheets related to the consolidation of the proportional interest in Monza’s operations (in thousands): June 30, December 31, 2024 2023 Working capital $ 913 $ 1,159 Oil and natural gas properties and other, net 29,911 31,805 Other assets 12,284 11,694 Asset retirement obligations 642 593 |
Schedule of Condensed Consolidated Statement of Operations related to the consolidation of the proportional interest in Monza's operations | The following table presents the amounts recorded by the Company in the Condensed (i Six Months Ended June 30, 2024 2023 Total revenues $ 5,700 $ 6,018 Total operating expenses 3,636 4,623 Interest income 111 104 |
NET (LOSS) INCOME PER SHARE (Ta
NET (LOSS) INCOME PER SHARE (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Notes Tables | |
Schedule of Earnings Per Share, Basic and Diluted | The following table presents the calculation of basic and diluted net (loss) income per common share (in thousands, except per share amounts): Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 Net (loss) income $ (15,388) $ (12,109) $ (26,862) $ 13,896 Weighted average common shares outstanding - basic 146,943 146,452 146,900 146,435 Dilutive effect of securities — — — 2,610 Weighted average common shares outstanding - diluted 146,943 146,452 146,900 149,045 Net (loss) income per common share: Basic $ (0.10) $ (0.08) $ (0.18) $ 0.09 Diluted (0.10) (0.08) (0.18) 0.09 Shares excluded due to being anti-dilutive 1,724 2,909 1,724 — |
OTHER SUPPLEMENTAL INFORMATION
OTHER SUPPLEMENTAL INFORMATION (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Notes Tables | |
Schedule of Prepaid expenses and other current assets | Prepaid expenses and other current assets consisted of the following (in thousands): June 30, December 31, 2024 2023 Derivatives $ 1,961 $ 1,180 Insurance/bond premiums 12,205 6,631 Prepaid deposits related to royalties 8,562 7,872 Prepayments to vendors 2,288 1,492 Other 874 272 Prepaid expenses and other current assets $ 25,890 $ 17,447 |
Schedule of Accrued Liabilities | Accrued liabilities consisted of the following (in thousands): June 30, December 31, 2024 2023 Accrued interest $ 13,479 $ 13,479 Accrued salaries/payroll taxes/benefits 3,258 9,473 Operating lease liabilities 1,484 1,455 Derivatives 8,945 6,267 Other 1,838 1,304 Total accrued liabilities $ 29,004 $ 31,978 |
Schedule of other Supplemental Disclosures | June 30, December 31, 2024 2023 Cash and cash equivalents $ 123,375 $ 173,338 Restricted cash 4,417 4,417 Cash, cash equivalents and restricted cash 127,792 177,755 Six Months Ended June 30, 2024 2023 Non-cash investing activities: Accruals of property and equipment 5,440 4,297 Dividends declared but not paid on unvested share-based awards 36 — ARO - acquisitions, additions and revisions, net 31,288 11,016 |
SUBSIDIARY BORROWERS (Tables)
SUBSIDIARY BORROWERS (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
SUBSIDIARY BORROWERS | |
Schedule of Consolidation of Subsidiary Borrowers | The following table presents the amounts recorded by the Company on the Condensed Consolidated Balance Sheets related to the consolidation of Aquasition Energy LLC, the parent of the Subsidiary Borrowers (the “Subsidiary Parent”), and the Subsidiary Borrowers (in thousands): June 30, December 31, 2024 2023 Assets: Cash and cash equivalents $ 4,453 $ 600 Receivables: Oil and natural gas sales 11,630 19,171 Joint interest, net (21,319) (33,151) Prepaid expenses and other current assets 834 612 Oil and natural gas properties and other, net 285,393 287,313 Other assets 5,689 8,097 Liabilities: Accounts payable 2,979 4,473 Accrued liabilities 9,830 7,152 Undistributed oil and natural gas proceeds 5,747 4,359 Current portion of long-term debt, net 14,400 28,872 Asset retirement obligations 70,914 67,771 Long-term debt, net 97,260 82,317 Other liabilities 4,261 6,749 |
Schedule of Subsidiary Borrowers and the subsidiary that owns the equity | The following table presents the amounts recorded by the Company in the Condensed Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 Total revenues $ 20,698 $ 25,437 $ 40,966 $ 46,560 Total operating expenses 20,386 30,443 39,260 50,490 Interest expense, net 2,209 3,229 4,451 5,411 Derivative loss (gain), net 2,446 (6,012) (3,129) (52,389) |
NATURE OF OPERATIONS AND BASI_3
NATURE OF OPERATIONS AND BASIS OF PRESENTATION (Details) | 6 Months Ended |
Jun. 30, 2024 segment | |
Note To Financial Statement Details Textual | |
Number of reportable segment | 1 |
ACQUISITION (Details)
ACQUISITION (Details) - USD ($) $ in Thousands | Jan. 16, 2024 | Dec. 13, 2023 | Jun. 30, 2024 | Feb. 29, 2024 | Dec. 31, 2023 |
Acquisition | |||||
Oil and natural gas properties and other, net | $ 802,401 | $ 749,056 | |||
Interests in and Operatorship of Certain Oil and Natural Gas Producing Properties | |||||
Acquisition | |||||
Acquisition price, expected | $ 72,000 | ||||
Consideration | $ 77,323 | ||||
Oil and natural gas properties and other, net | $ 94,970 | ||||
September 2023 acquisition | |||||
Acquisition | |||||
Oil and natural gas properties and other, net | $ 3,300 |
ACQUISITION - Allocation of Tot
ACQUISITION - Allocation of Total Purchase Consideration (Details) - USD ($) $ in Thousands | Jan. 16, 2024 | Jun. 30, 2024 | Dec. 31, 2023 | Jun. 30, 2023 | Dec. 31, 2022 |
Acquisition | |||||
Oil and natural gas properties and other, net | $ 802,401 | $ 749,056 | |||
Asset retirement obligations | $ (534,475) | $ (498,815) | $ (480,832) | $ (466,430) | |
Interests in and Operatorship of Certain Oil and Natural Gas Producing Properties | |||||
Acquisition | |||||
Oil and natural gas properties and other, net | $ 94,970 | ||||
Asset retirement obligations | (17,647) | ||||
Allocated purchase price | $ 77,323 |
DEBT - Components of Long-term
DEBT - Components of Long-term Debt (Details) - USD ($) $ in Thousands | Jun. 30, 2024 | Dec. 31, 2023 | Jun. 30, 2023 |
Total | $ 391,904 | $ 390,604 | |
Less current portion, net | (14,925) | (29,368) | |
Long-term debt, net | 376,979 | 361,236 | |
Term Loan | |||
Principal | 114,159 | 114,159 | |
Unamortized debt issuance costs | (2,499) | (3,052) | |
Total | 111,660 | 111,107 | |
11.75% Senior Second Lien Notes due 2026 | |||
Principal | 275,000 | 275,000 | |
Unamortized debt issuance costs | (4,019) | (5,090) | |
Total | $ 270,981 | $ 269,910 | |
Debt instrument, interest rate, stated percentage | 11.75% | 11.75% | 11.75% |
TVPX Loan | |||
Principal | $ 10,475 | $ 11,025 | |
Unamortized discount | (1,027) | (1,294) | |
Unamortized debt issuance costs | (185) | (144) | |
Total | $ 9,263 | $ 9,587 |
DEBT (Details)
DEBT (Details) | May 17, 2024 USD ($) installment | Jun. 30, 2024 USD ($) | Dec. 31, 2023 USD ($) |
Term Loan | |||
Deferral of principal | $ 30,100,000 | ||
Amendment fee | $ 200,000 | ||
Number of quarterly installments | installment | 4 | ||
Amendment fee installment amount | $ 50,000 | ||
Term Loan | Redemption from May 2024 to May 2026 | |||
Redemption price, percentage | 103% | ||
Term Loan | Redemption from May 2026 to May 2027 | |||
Redemption price, percentage | 102% | ||
Term Loan | Redemption from May 2027 up to maturity in May 2028 | |||
Redemption price, percentage | 101% | ||
Credit Agreement | |||
Borrowings outstanding | $ 0 | ||
Line of Credit Facility, Maximum Borrowing Capacity | 50,000,000 | ||
Letters of Credit Outstanding, Amount | $ 4,400,000 | $ 4,400,000 |
FINANCIAL INSTRUMENTS - Summary
FINANCIAL INSTRUMENTS - Summary of Open Derivative Contracts (Details) | 6 Months Ended |
Jun. 30, 2024 MMBTU $ / MMBTU | |
August 2024 - Dec 2024 | |
Average Daily Volumes | 65,000 |
Total Volumes | 9,945,000 |
August 2024 - Dec 2024 | Call Option | |
Weighted Price (in dollars per share) | $ / MMBTU | 6.13 |
Jan 2025 - Mar 2025 | |
Average Daily Volumes | 62,000 |
Total Volumes | 5,580,000 |
Jan 2025 - Mar 2025 | Call Option | |
Weighted Price (in dollars per share) | $ / MMBTU | 5.50 |
August 2024 - Dec 2024 | |
Average Daily Volumes | 65,359 |
Total Volumes | 10,000,000 |
Weighted Price (in dollars per share) | $ / MMBTU | 2.45 |
Jan 2025 - Mar 2025 | |
Average Daily Volumes | 63,333 |
Total Volumes | 5,700,000 |
Weighted Price (in dollars per share) | $ / MMBTU | 2.72 |
Apr 2025 - Dec 2025 | |
Average Daily Volumes | 62,182 |
Total Volumes | 17,100,000 |
Apr 2025 - Dec 2025 | Put Option | |
Weighted Price (in dollars per share) | $ / MMBTU | 2.27 |
Jan 2026 - Dec 2026 | |
Average Daily Volumes | 55,890 |
Total Volumes | 20,400,000 |
Jan 2026 - Dec 2026 | Put Option | |
Weighted Price (in dollars per share) | $ / MMBTU | 2.35 |
Jan 2027 - Dec 2027 | |
Average Daily Volumes | 52,603 |
Total Volumes | 19,200,000 |
Jan 2027 - Dec 2027 | Put Option | |
Weighted Price (in dollars per share) | $ / MMBTU | 2.37 |
Jan 2028 - Apr 2028 | |
Average Daily Volumes | 49,587 |
Total Volumes | 6,000,000 |
Jan 2028 - Apr 2028 | Put Option | |
Weighted Price (in dollars per share) | $ / MMBTU | 2.50 |
FINANCIAL INSTRUMENTS - Financi
FINANCIAL INSTRUMENTS - Financial Statement Presentation - Balance Sheets (Details) - USD ($) $ in Thousands | Jun. 30, 2024 | Dec. 31, 2023 |
Derivatives | $ 1,961 | $ 1,180 |
Derivative liabilities, current | 8,945 | 6,267 |
Open Contracts and Closed Contracts Which Had Not Yet Been Settled | ||
Derivatives | $ 1,961 | $ 1,180 |
Derivative Asset, Current, Statement of Financial Position [Extensible Enumeration] | Prepaid expenses and other assets (Note 1) | Prepaid expenses and other assets (Note 1) |
Derivatives | $ 6,755 | $ 10,068 |
Derivative Asset, Noncurrent, Statement of Financial Position [Extensible Enumeration] | Other assets (Note 1) | Other assets (Note 1) |
Derivative liabilities, current | $ 8,945 | $ 6,267 |
Derivative Liability, Current, Statement of Financial Position [Extensible Enumeration] | Accrued Liabilities, Current | Accrued Liabilities, Current |
Derivative liabilities, non-current | $ 2,756 | |
Derivative Liability, Noncurrent, Statement of Financial Position [Extensible Enumeration] | Other liabilities (Note 1) |
FINANCIAL INSTRUMENTS - Finan_2
FINANCIAL INSTRUMENTS - Financial Statement Presentation - Statements of Operations (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Financial Instruments. | ||||
Realized (gain) loss | $ (364) | $ 300 | $ (4,119) | $ 530 |
Unrealized loss (gain) | 2,738 | (1,129) | 1,616 | (40,599) |
Derivative loss (gain), net | $ 2,374 | $ (829) | $ (2,503) | $ (40,069) |
FINANCIAL INSTRUMENTS - Net Val
FINANCIAL INSTRUMENTS - Net Value and Fair value of Debt (Details) - USD ($) $ in Thousands | Jun. 30, 2024 | Dec. 31, 2023 | Jun. 30, 2023 |
Long-term debt, net value | $ 391,904 | $ 390,604 | |
Long-term debt, fair value | 401,070 | 402,066 | |
Term Loan | |||
Long-term debt, net value | 111,660 | 111,107 | |
Long-term debt, fair value | 108,371 | 108,467 | |
11.75% Notes | |||
Long-term debt, net value | 270,981 | 269,910 | |
Long-term debt, fair value | $ 282,923 | $ 283,443 | |
Debt instrument, interest rate, stated percentage | 11.75% | 11.75% | 11.75% |
TVPX Loan | |||
Long-term debt, net value | $ 9,263 | $ 9,587 | |
Long-term debt, fair value | $ 9,776 | $ 10,156 |
ASSET RETIREMENT OBLIGATIONS (D
ASSET RETIREMENT OBLIGATIONS (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | Dec. 31, 2023 | |
Asset Retirement Obligations - Changes to Asset Retirement Obligation (Details) | |||||
Asset retirement obligations, beginning of period | $ 498,815 | $ 466,430 | |||
Liabilities settled | (11,997) | (11,841) | |||
Accretion expense | $ 8,400 | $ 7,717 | 16,369 | 15,227 | |
Liabilities acquired | 17,647 | ||||
Liabilities incurred | 113 | ||||
Revisions of estimated liabilities | 13,641 | 10,903 | |||
Asset retirement obligations, end of period | 534,475 | 480,832 | 534,475 | 480,832 | |
Less: Current portion | (35,627) | (37,763) | (35,627) | (37,763) | $ (31,553) |
Asset retirement obligations | $ 498,848 | $ 443,069 | $ 498,848 | $ 443,069 | $ 467,262 |
CONTINGENCIES (Details)
CONTINGENCIES (Details) - USD ($) $ in Millions | 6 Months Ended | |
Jun. 30, 2024 | Dec. 31, 2010 | |
Additional royalty due to disallowed deductions | $ 4.7 | $ 4.7 |
Accrued royalties | 5 | |
Estimated penalties | 0.3 | |
Decommissioning obligations | 8.4 | |
Additional decommissioning obligations | 7 | |
Loss of decommissioning obligations | 16.7 | |
Surety Bonds | ||
Value of surety bond | $ 9.9 |
INVESTMENT IN MONZA (Details)
INVESTMENT IN MONZA (Details) - Monza Energy, LLC $ in Millions | 1 Months Ended | ||
Mar. 31, 2018 USD ($) | Jun. 30, 2024 USD ($) | Dec. 31, 2023 USD ($) | |
Cash call balance | $ 2.6 | $ 2.7 | |
Cash distribution payment from related party | 18 | ||
Cash distribution paid | $ 3.8 | ||
JV Drilling Program [Member] | |||
Amount committed by investors | $ 361.4 | ||
Joint Venture Working Interest Percentage Contributed to Related Party | 88.94% | ||
Joint Venture Working Interest Percent | 11.06 | ||
Oil And Gas Revenue Percent | 30 | ||
Well Cost Percent | 20 |
INVESTMENT IN MONZA - Consolida
INVESTMENT IN MONZA - Consolidation and Carrying Amounts - Balance Sheet (Details) - USD ($) $ in Thousands | Jun. 30, 2024 | Dec. 31, 2023 | Jun. 30, 2023 |
Oil and natural gas properties and other, net | $ 802,401 | $ 749,056 | |
Other assets | 33,396 | 38,923 | |
Asset retirement obligations | 35,627 | 31,553 | $ 37,763 |
Monza Energy, LLC [Member] | |||
Working capital | 913 | 1,159 | |
Oil and natural gas properties and other, net | 29,911 | 31,805 | |
Other assets | 12,284 | 11,694 | |
Asset retirement obligations | $ 642 | $ 593 |
INVESTMENT IN MONZA - Consoli_2
INVESTMENT IN MONZA - Consolidation and Carrying Amounts - Statement of Operations (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Total revenues | $ 142,757 | $ 126,181 | $ 283,544 | $ 257,906 |
Monza Energy, LLC [Member] | ||||
Total revenues | 5,700 | 6,018 | ||
Total operating expenses | 3,636 | 4,623 | ||
Interest income | $ 111 | $ 104 |
STOCKHOLDERS' EQUITY - Cash Div
STOCKHOLDERS' EQUITY - Cash Dividends (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Sep. 30, 2024 | Jun. 30, 2024 | Mar. 31, 2024 | Jun. 30, 2024 | |
STOCKHOLDERS' EQUITY | ||||
Cash dividends paid | $ 2,954 | |||
Q1 2024 Dividends | ||||
STOCKHOLDERS' EQUITY | ||||
Dividends Payable, Date Declared | Mar. 05, 2024 | |||
Common stock, dividend declared (in dollars per share) | $ 0.01 | |||
Cash dividends paid | $ 1,500 | |||
Dividends Payable, Date to be Paid | Mar. 25, 2024 | |||
Q2 2024 Dividends | ||||
STOCKHOLDERS' EQUITY | ||||
Dividends Payable, Date Declared | May 10, 2024 | |||
Common stock, dividend declared (in dollars per share) | $ 0.01 | |||
Cash dividends paid | $ 1,500 | |||
Dividends Payable, Date to be Paid | May 31, 2024 | |||
Q3 2024 Dividends | Subsequent event | ||||
STOCKHOLDERS' EQUITY | ||||
Dividends Payable, Date Declared | Aug. 06, 2024 | |||
Common stock, dividend declared (in dollars per share) | $ 0.01 | |||
Dividends Payable, Date to be Paid | Aug. 27, 2024 |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2024 | Jun. 30, 2023 | Dec. 31, 2023 | |
Note To Financial Statement Details Textual | ||||
Effective income tax rate | 23.10% | 11.80% | 45.60% | |
Valuation allowance | $ 27.1 | $ 27.1 | $ 23.2 |
NET (LOSS) INCOME PER SHARE (De
NET (LOSS) INCOME PER SHARE (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
EARNINGS PER SHARE - Schedule of Basic and Diluted (Loss) Earnings Per Common Share (Details) | ||||
Net (loss) income | $ (15,388) | $ (12,109) | $ (26,862) | $ 13,896 |
Weighted average common shares outstanding - basic (in shares) | 146,943 | 146,452 | 146,900 | 146,435 |
Dilutive effect of securities (in shares) | 2,610 | |||
Weighted average common shares outstanding - diluted (in shares) | 146,943 | 146,452 | 146,900 | 149,045 |
Net (loss) income per common share - Basic (in dollars per share) | $ (0.10) | $ (0.08) | $ (0.18) | $ 0.09 |
Net (loss) income per common share - Diluted (in dollars per share) | $ (0.10) | $ (0.08) | $ (0.18) | $ 0.09 |
Shares excluded due to being anti-dilutive | 1,724 | 2,909 | 1,724 |
OTHER SUPPLEMENTAL INFORMATIO_2
OTHER SUPPLEMENTAL INFORMATION - Prepaid Expenses and Other Current Assets (Details) - USD ($) $ in Thousands | Jun. 30, 2024 | Dec. 31, 2023 |
OTHER SUPPLEMENTAL INFORMATION - Amounts Recorded in Prepaid Expenses and Other Current Assets (Details) | ||
Derivatives | $ 1,961 | $ 1,180 |
Insurance/bond premiums | 12,205 | 6,631 |
Prepaid deposits related to royalties | 8,562 | 7,872 |
Prepayments to vendors | 2,288 | 1,492 |
Other | 874 | 272 |
Prepaid expenses and other current assets | $ 25,890 | $ 17,447 |
OTHER SUPPLEMENTAL INFORMATIO_3
OTHER SUPPLEMENTAL INFORMATION - Accrued Liabilities (Details) - USD ($) $ in Thousands | Jun. 30, 2024 | Dec. 31, 2023 |
OTHER SUPPLEMENTAL INFORMATION - Schedule of Accrued Liabilities (Details) | ||
Accrued interest | $ 13,479 | $ 13,479 |
Accrued salaries/payroll taxes/benefits | 3,258 | 9,473 |
Operating lease liabilities | 1,484 | 1,455 |
Derivatives | 8,945 | 6,267 |
Other | 1,838 | 1,304 |
Total accrued liabilities | $ 29,004 | $ 31,978 |
OTHER SUPPLEMENTAL INFORMATIO_4
OTHER SUPPLEMENTAL INFORMATION - Consolidated Statement of Cash Flows Information (Details) - USD ($) $ in Thousands | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Dec. 31, 2023 | |
OTHER SUPPLEMENTAL INFORMATION - Supplemental Cash Flow Information (Details) | |||
Cash and cash equivalents | $ 123,375 | $ 173,338 | |
Restricted cash | 4,417 | 4,417 | |
Cash, cash equivalents and restricted cash | 127,792 | $ 177,755 | |
Non-cash investing activities: | |||
Accruals of property and equipment | 5,440 | $ 4,297 | |
Dividends declared but not paid on unvested share-based awards | 36 | ||
ARO - acquisitions, additions and revisions, net | $ 31,288 | $ 11,016 |
SUBSIDIARY BORROWERS - Consolid
SUBSIDIARY BORROWERS - Consolidation of Subsidiary Borrowers - Balance Sheets (Details) - USD ($) $ in Thousands | Jun. 30, 2024 | Dec. 31, 2023 | Jun. 30, 2023 |
Assets: | |||
Cash and cash equivalents | $ 123,375 | $ 173,338 | |
Receivables: | |||
Oil and natural gas sales | 71,547 | 52,080 | |
Joint interest, net | (20,478) | (15,480) | |
Prepaid expenses and other current assets | 25,890 | 17,447 | |
Oil and natural gas properties and other, net | 802,401 | 749,056 | |
Other assets | 33,396 | 38,923 | |
Liabilities: | |||
Accounts payable | 89,129 | 78,857 | |
Accrued liabilities | 29,004 | 31,978 | |
Undistributed oil and natural gas proceeds | 63,150 | 42,134 | |
Current portion of long-term debt, net | 14,925 | 29,368 | |
Asset retirement obligations | 35,627 | 31,553 | $ 37,763 |
Asset retirement obligations | 498,848 | 467,262 | $ 443,069 |
Long-term debt, net | 376,979 | 361,236 | |
Other liabilities | 16,668 | 19,420 | |
Subsidiary Borrowers | |||
Assets: | |||
Cash and cash equivalents | 4,453 | 600 | |
Receivables: | |||
Oil and natural gas sales | 11,630 | 19,171 | |
Joint interest, net | (21,319) | (33,151) | |
Prepaid expenses and other current assets | 834 | 612 | |
Oil and natural gas properties and other, net | 285,393 | 287,313 | |
Other assets | 5,689 | 8,097 | |
Liabilities: | |||
Accounts payable | 2,979 | 4,473 | |
Accrued liabilities | 9,830 | 7,152 | |
Undistributed oil and natural gas proceeds | 5,747 | 4,359 | |
Current portion of long-term debt, net | 14,400 | 28,872 | |
Asset retirement obligations | 70,914 | 67,771 | |
Long-term debt, net | 97,260 | 82,317 | |
Other liabilities | $ 4,261 | $ 6,749 |
SUBSIDIARY BORROWERS - Consol_2
SUBSIDIARY BORROWERS - Consolidation of Subsidiary Borrowers - Statement of Operations (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Subsidiary or Equity Method Investee [Line Items] | ||||
Total revenues | $ 142,757 | $ 126,181 | $ 283,544 | $ 257,906 |
Total operating expenses | 148,993 | 126,110 | 289,784 | 247,485 |
Interest expense, net | 10,164 | 10,323 | 20,236 | 25,036 |
Derivative loss (gain), net | 2,374 | (829) | (2,503) | (40,069) |
Subsidiary Borrowers | ||||
Subsidiary or Equity Method Investee [Line Items] | ||||
Total revenues | 20,698 | 25,437 | 40,966 | 46,560 |
Total operating expenses | 20,386 | 30,443 | 39,260 | 50,490 |
Interest expense, net | 2,209 | 3,229 | 4,451 | 5,411 |
Derivative loss (gain), net | $ 2,446 | $ (6,012) | $ (3,129) | $ (52,389) |