Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2018 | Apr. 30, 2018 | |
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Mar. 31, 2018 | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q1 | |
Trading Symbol | WTI | |
Entity Registrant Name | W&T OFFSHORE INC | |
Entity Central Index Key | 1,288,403 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 139,091,289 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 |
Current assets: | ||
Cash and cash equivalents | $ 130,711 | $ 99,058 |
Receivables: | ||
Oil and natural gas sales | 44,942 | 45,443 |
Joint interest | 17,835 | 19,754 |
Income taxes | 65,103 | 13,006 |
Total receivables | 127,880 | 78,203 |
Prepaid expenses and other assets (Note 1) | 20,197 | 13,419 |
Total current assets | 278,788 | 190,680 |
Oil and natural gas properties and other, net - at cost: (Note 1) | 573,352 | 579,016 |
Restricted deposits for asset retirement obligations | 25,622 | 25,394 |
Income taxes receivable | 52,097 | |
Other assets (Note 1) | 64,414 | 60,393 |
Total assets | 942,176 | 907,580 |
Current liabilities: | ||
Accounts payable | 77,444 | 83,665 |
Undistributed oil and natural gas proceeds | 22,273 | 20,129 |
Asset retirement obligations | 25,748 | 23,613 |
Long-term debt | 22,858 | 22,925 |
Accrued liabilities (Note 1) | 23,293 | 17,930 |
Total current liabilities | 171,616 | 168,262 |
Long-term debt: (Note 2) | ||
Principal | 889,790 | 889,790 |
Carrying value adjustments | 77,691 | 79,337 |
Long term debt, less current portion - carrying value | 967,481 | 969,127 |
Asset retirement obligations, less current portion | 280,735 | 276,833 |
Other liabilities (Note 1) | 66,993 | 66,866 |
Commitments and contingencies (Note 10) | ||
Shareholders’ deficit: | ||
Preferred stock, $0.00001 par value; 20,000,000 shares authorized; 0 issued at March 31, 2018 and December 31, 2017 | ||
Common stock, $0.00001 par value; 200,000,000 shares authorized; 141,960,462 issued and 139,091,289 outstanding at March 31, 2018 and December 31, 2017 | 1 | 1 |
Additional paid-in capital | 547,039 | 545,820 |
Retained earnings (deficit) | (1,067,522) | (1,095,162) |
Treasury stock, at cost; 2,869,173 shares at March 31, 2018 and December 31, 2017 | (24,167) | (24,167) |
Total shareholders' equity (deficit) | (544,649) | (573,508) |
Total liabilities and shareholders' equity (deficit) | $ 942,176 | $ 907,580 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Mar. 31, 2018 | Dec. 31, 2017 |
Statement Of Financial Position [Abstract] | ||
Preferred stock, par value | $ 0.00001 | $ 0.00001 |
Preferred stock, shares authorized | 20,000,000 | 20,000,000 |
Preferred stock, issued | 0 | 0 |
Common stock, par value | $ 0.00001 | $ 0.00001 |
Common stock, shares authorized | 200,000,000 | 200,000,000 |
Common stock, issued | 141,960,462 | 141,960,462 |
Common stock, outstanding | 139,091,289 | 139,091,289 |
Treasury stock, shares | 2,869,173 | 2,869,173 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Revenues: | ||
Oil | $ 97,306 | $ 84,971 |
NGLs | 9,660 | 8,742 |
Natural gas | 25,867 | 29,758 |
Other | 1,380 | 922 |
Total revenues | 134,213 | 124,393 |
Operating costs and expenses: | ||
Lease operating expenses | 36,843 | 40,164 |
Production taxes | 455 | 515 |
Gathering and transportation | 5,057 | 6,209 |
Depreciation, depletion, amortization and accretion | 38,081 | 39,990 |
General and administrative expenses | 15,038 | 13,274 |
Derivative gain | (3,955) | |
Total costs and expenses | 95,474 | 96,197 |
Operating income | 38,739 | 28,196 |
Interest expense | 11,323 | 11,294 |
Other (income) expense, net | (333) | 191 |
Income before income tax expense (benefit) | 27,749 | 16,711 |
Income tax expense (benefit) | 109 | (7,588) |
Net income | $ 27,640 | $ 24,299 |
Basic and diluted earnings per common share | $ 0.19 | $ 0.17 |
Condensed Consolidated Stateme5
Condensed Consolidated Statement of Changes in Shareholders' Deficit - 3 months ended Mar. 31, 2018 - USD ($) shares in Thousands, $ in Thousands | Total | Common Stock Outstanding | Additional Paid-In Capital | Retained Earnings (Deficit) | Treasury Stock |
Beginning Balances at Dec. 31, 2017 | $ (573,508) | $ 1 | $ 545,820 | $ (1,095,162) | $ (24,167) |
Beginning Balances (in shares) at Dec. 31, 2017 | 139,091 | 2,869 | |||
Share-based compensation | 1,219 | 1,219 | |||
Net income | 27,640 | 27,640 | |||
Ending Balances at Mar. 31, 2018 | $ (544,649) | $ 1 | $ 547,039 | $ (1,067,522) | $ (24,167) |
Ending Balances (in shares) at Mar. 31, 2018 | 139,091 | 2,869 |
Condensed Consolidated Stateme6
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Operating activities: | ||
Net income | $ 27,640 | $ 24,299 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation, depletion, amortization and accretion | 38,081 | 39,990 |
Amortization of debt items | 466 | 412 |
Share-based compensation | 1,219 | 1,928 |
Derivative gain | (3,955) | |
Cash receipts on derivative settlements, net | 713 | |
Deferred income taxes | 109 | 105 |
Changes in operating assets and liabilities: | ||
Oil and natural gas receivables | 501 | (1,882) |
Joint interest receivables | 1,919 | 5,042 |
Insurance reimbursements | 30,100 | |
Prepaid expenses and other assets | (6,391) | (7,972) |
Asset retirement obligation settlements | (7,022) | (14,499) |
Cash advances from JV partners | 19,147 | (2,531) |
Accounts payable, accrued liabilities and other | (688) | 9,433 |
Net cash provided by operating activities | 74,981 | 81,183 |
Investing activities: | ||
Investment in oil and natural gas properties and equipment | (21,117) | (23,338) |
Changes in operating assets and liabilities associated with investing activities | (17,154) | 1,168 |
Deposit for acquisition | (3,000) | |
Purchases of furniture, fixtures and other | (853) | |
Net cash used in investing activities | (41,271) | (23,023) |
Financing activities: | ||
Other | (245) | |
Net cash used in financing activities | (2,057) | (2,301) |
Increase in cash and cash equivalents | 31,653 | 55,859 |
Cash and cash equivalents, beginning of period | 99,058 | 70,236 |
Cash and cash equivalents, end of period | 130,711 | 126,095 |
11.00% 1.5 Lien Term Loan, Due November 2019 | ||
Financing activities: | ||
Payment of interest | $ (2,057) | $ (2,056) |
Basis of Presentation
Basis of Presentation | 3 Months Ended |
Mar. 31, 2018 | |
Accounting Policies [Abstract] | |
Basis of Presentation | 1. Basis of Presentation Operations. W&T Offshore, Inc. (with subsidiaries referred to herein as “W&T,” “we,” “us,” “our,” or 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. Our interests in fields, leases, structures and equipment are primarily owned by W&T Offshore, Inc. (on a stand-alone basis, the “Parent Company”) and its 100%-owned subsidiary, W & T Energy VI, LLC (“Energy VI”) and through our proportionately consolidated interest in Monza Energy LLC, as described in more detail below under the subheading “-Recent Events” in this Note and in Note 4 herein. Interim Financial Statements. The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim periods and the appropriate rules and regulations of the Securities and Exchange Commission (“SEC”). Accordingly, the condensed consolidated financial statements do not include all of the information and footnote disclosures required by GAAP for complete financial statements for annual periods. 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 the Company’s Annual Report on Form 10-K for the year ended December 31, 2017. 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. Recent Events. The price we receive for our crude oil, natural gas liquids (“NGLs”) and natural gas production directly affects our revenues, profitability, cash flows, liquidity, access to capital, proved reserves and future rate of growth. The average realized prices of these commodities improved during the three months ended March 31, 2018 compared to the average realized prices in the three months ended March 31, 2017. Operating costs were lower for the three months ended March 31, 2018 on an absolute basis compared to the three months ended March 31, 2017. Our Fifth Amended and Restated Credit Agreement (as amended, the “Credit Agreement”) provides our revolver bank credit facility and matures on November 8, 2018. As of March 31, 2018, we had $0.3 million of letters of credit outstanding and no amounts borrowed on our revolving bank credit facility. Our 8.500% Senior Notes (the “Unsecured Senior Notes”) mature on June 15, 2019. If the Unsecured Senior Notes have not been extended, refunded, defeased, discharged, replaced or refinanced by February 28, 2019, then the 11.00% 1.5 Lien Term Loan, due November 15, 2019 (the “1.5 Lien Term Loan”) and the 8.50%/10.00% Third Lien Payment-In-Kind (“PIK”) Toggle Notes, due June 15, 2021, (the “Third Lien PIK Toggle Notes”) will both accelerate their maturity to February 28, 2019. During the remainder of 2018, we plan to address the issues of the potential maturity acceleration of these two debt instruments and to extend or replace the revolving bank credit facility. We expect to build sufficient cash balances in 2018 to be able to redeem, repurchase or refinance the Unsecured Senior Notes. Certain amendments under the Credit Agreement and the 1.5 Lien Term Loan will likely be required in the event we redeem or repurchase the Unsecured Senior Notes, which we anticipate would be granted if requested. Assuming we can also repay or refinance the 1.5 Lien Term Loan, then we believe that we would amend our revolving bank credit facility in such a manner that will permit an extension of the maturity of such facility. There can be no assurance that lenders will extend our revolving bank credit facility maturity, but under current market conditions and based on the outlook of our cash position in 2018 and further, we believe our lenders or replacement lenders will be amenable to participating in a refinancing or other corporate financing transaction. On March 12, 2018, W&T and two initial members formed and initially funded a limited liability company, Monza Energy LLC, a Delaware limited liability company (“Monza”), that will jointly participate with us in the exploration, drilling and development of up to 14 identified drilling projects (the “JV Drilling Program”) in the Gulf of Mexico over the next three years. W&T contributed 88.94% of its working interest in the 14 identified projects to Monza and retained an 11.06% working interest. Since the initial closing, additional investors have joined in Monza and as of April 27, 2018, total commitments by all investors are $297.6 million. We anticipate additional investors will join in the program. In summary, W&T owns a direct interest in the 14 drilling projects as well as an indirect interest via its interest in Monza. The JV Drilling Program is structured so that we initially receive an aggregate of 30.0% of the net revenues, through both our direct ownership of our working interest in the projects and our indirect interest through our 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. See Note 4 and Note 11 for additional information. We have assessed our financial condition, the current capital markets and options given different scenarios of commodity prices. We believe we will have adequate available liquidity to fund our operations through May 2019, the period of assessment to qualify as a going concern. However, we cannot predict the potential changes in commodity prices or future Bureau of Ocean Energy Management (“BOEM”) bonding requirements, either of which could affect our operations, liquidity levels and compliance with debt covenants. See our Annual Report on Form 10-K for the year ended December 31, 2017 concerning risks related to our business and events occurring during 2017 and other information and the Notes herein for additional information. Accounting Standard Updates Effective January 1, 2018. Accounting Standards Update No. 2016-18, (“ASU 2016-18”), Statement of Cash Flows (Topic 230) – Restricted Cash became effective for us in the period ending March 31, 2018. As we did not have any amounts recorded as restricted cash in the three months ended March 31, 2018, or any amounts recorded as restricted cash during 2017, ASU 2016-18 did not affect the Condensed Consolidated Statement of Cash Flows. Accounting Standard Update No. 2014-09, (“ASU 2014-09”) Revenue from Customers (Topic 606) Revenue Recognition . We recognize revenue from the sale of crude oil, NGLs, and natural gas when our performance obligations are satisfied. Our contracts with customers are primarily short-term (less than 12 months). Our responsibilities to deliver a unit of crude oil, NGL, and natural gas under these contracts represent separate, distinct performance obligations. These performance obligations are satisfied at the point in time control of each unit is transferred to the customer. Pricing is primarily determined utilizing a particular pricing or market index, plus or minus adjustments reflecting quality or location differentials. Reclassification. Certain reclassifications have been made to prior periods’ financial statements to conform to the current presentation as follows: Within the Net Cash Provided by Operating Activities of the Condensed Consolidated Statements of Cash Flows, adjustments were made to certain line items, of which did not change the total amount previous reported. The adjustments did not affect the Condensed Consolidated Balance Sheets or the Condensed Consolidated Statements of Operations. Prepaid Expenses and Other Assets. The amounts recorded are expected to be realized within one year and the major categories are presented in the following table (in thousands): March 31, December 31, 2018 2017 Prepaid/accrued insurance $ 1,983 $ 2,401 Surety bond unamortized premiums 3,387 2,676 Prepaid deposits related to royalties 7,451 6,456 Deposit related to an acquisition 3,000 — Proportional consolidation of Monza prepaids (Note 4) 2,399 — Other 1,977 1,886 Prepaid expenses and other assets $ 20,197 $ 13,419 Oil and Natural Gas Properties and Other, Net – at cost. March 31, December 31, 2018 2017 Oil and natural gas properties and equipment $ 8,129,924 $ 8,102,044 Furniture, fixtures and other 21,831 21,831 Total property and equipment 8,151,755 8,123,875 Less accumulated depreciation, depletion and amortization 7,578,403 7,544,859 Oil and natural gas properties and other, net $ 573,352 $ 579,016 Accrued Liabilities. The major categories are presented in the following table (in thousands): March 31, December 31, 2018 2017 Accrued interest $ 14,889 $ 4,200 Accrued salaries/payroll taxes/benefits 2,577 2,454 Incentive compensation plans 1,993 7,366 Litigation accruals 3,480 3,480 Other 354 430 Total accrued liabilities $ 23,293 $ 17,930 Other Assets (long-term). The major categories are presented in the following table (in thousands): March 31, December 31, 2018 2017 Escrow deposit - Apache lawsuit $ 49,500 $ 49,500 Appeal bond deposits 6,925 6,925 Investment in White Cap, LLC 2,593 2,511 Unamortized brokerage fee for Monza 1,724 — Proportional consolidation of Monza other assets (Note 4) 2,387 — Other 1,285 1,457 Total other assets $ 64,414 $ 60,393 Other Liabilities (long-term). The major categories are presented in the following table (in thousands): March 31, December 31, 2018 2017 Apache lawsuit $ 49,500 $ 49,500 Uncertain tax positions including interest/penalties 11,124 11,015 Other 6,369 6,351 Total other liabilities (long-term) $ 66,993 $ 66,866 Recent Accounting Developments. In February 2016, the FASB issued Accounting Standards Update No. 2016-02 (“ASU 2016-02”), Leases ( Subtopic 842 ). Under the new guidance, a lessee will be required to recognize assets and liabilities for leases with lease terms of more than 12 months. Consistent with current GAAP, the recognition, measurement and presentation of expenses and cash flows arising from a lease by a lessee primarily will depend on its classification as a financing or operating lease. However, unlike current GAAP, which requires only capital or financing leases to be recognized on the balance sheet, ASU 2016-02 will require both types of leases to be recognized on the balance sheet. ASU 2016-02 also will require disclosures to help investors and other financial statement users to better understand the amount, timing and uncertainty of cash flows arising from leases. These disclosures include qualitative and quantitative requirements, providing additional information about the amounts recorded in the financial statements. ASU 2016-02 does not apply for leases for oil and gas properties, but does apply to equipment used to explore and develop oil and gas resources. ASU 2016-02 is effective for annual and interim periods beginning after December 15, 2018 and is to be applied using the modified retrospective approach. Our current operating leases that will be impacted by ASU 2016-02 are leases for office space, which is primarily in Houston, Texas, although ASU 2016-02 may impact the accounting for leases related to equipment depending on the term of the lease. We currently do not have any leases classified as financing leases nor do we have any leases recorded on the Condensed Consolidated Balance Sheets. We have not yet fully determined or quantified the effect ASU 2016-02 will have on our financial statements. In June 2016, the FASB issued Accounting Standards Update No. 2016-13, (“ASU 2016-13”), Financial Instruments – Credit Losses Subtopic 326 In August 2017, the FASB issued Accounting Standards Update No. 2017-12, (“ASU 2017-12”), Derivatives and Hedging (Topic 815) – Targeted Improvements to Accounting for Hedging Activities |
Long-Term Debt
Long-Term Debt | 3 Months Ended |
Mar. 31, 2018 | |
Debt Disclosure [Abstract] | |
Long-Term Debt | 2. Long-Term Debt The components of our long-term debt are presented in the following table (in thousands): March 31, 2018 December 31, 2017 Adjustments to Adjustments to Carrying Carrying Carrying Carrying Principal Value (1) Value Principal Value (1) Value 11.00% 1.5 Lien Term Loan, due November 2019: Principal $ 75,000 $ — $ 75,000 $ 75,000 $ — $ 75,000 Future interest payments — 13,539 13,539 — 15,596 15,596 Subtotal 75,000 13,539 88,539 75,000 15,596 90,596 9.00 % Second Lien Term Loan, due May 2020: 300,000 — 300,000 300,000 — 300,000 9.00%/10.75% Second Lien PIK Toggle Notes, due May 2020: Principal 171,769 — 171,769 171,769 — 171,769 Future payments-in-kind — 5,745 5,745 — 5,745 5,745 Future interest payments — 34,872 34,872 — 34,872 34,872 Subtotal 171,769 40,617 212,386 171,769 40,617 212,386 8.50%/10.00% Third Lien PIK Toggle Notes, due June 2021: Principal 153,192 — 153,192 153,192 — 153,192 Future payments-in-kind — 11,323 11,323 — 11,323 11,323 Future interest payments — 38,682 38,682 — 38,682 38,682 Subtotal 153,192 50,005 203,197 153,192 50,005 203,197 8.50% Unsecured Senior Notes, due June 2019 189,829 — 189,829 189,829 — 189,829 Debt premium, discount, issuance costs, net of amortization — (3,612 ) (3,612 ) — (3,956 ) (3,956 ) Total long-term debt 889,790 100,549 990,339 889,790 102,262 992,052 Current maturities of long-term debt (2) — 22,858 22,858 — 22,925 22,925 Long term debt, less current maturities $ 889,790 $ 77,691 $ 967,481 $ 889,790 $ 79,337 $ 969,127 (1) Future interest payments and future payments-in-kind are recorded on an undiscounted basis. (2) Future interest payments on the 1.5 Lien Term Loan, Second Lien PIK Toggle Notes and Third Lien PIK Toggle Notes due within twelve months. Accounting for Certain Debt Instruments We accounted for a transaction executed on September 7, 2016 as a Troubled Debt Restructuring pursuant to the guidance under Accounting Standard Codification 470-60, Troubled Debt Restructuring The primary terms of our long-term debt are described below: Credit Agreement. The Credit Agreement provides a revolving bank credit facility and expires by its term on November 8, 2018. The primary items of the Credit Agreement are as follows, with certain terms defined under the Credit Agreement: • The borrowing base is $150.0 million. • Letters of credit may be issued in amounts up to $150.0 million, provided availability under the revolving bank credit facility exists. • The First Lien Leverage Ratio limit is 2.00 to 1.00. • The Current Ratio must be greater than 1.00 to 1.00. • We are required to have deposit accounts only with banks under the Credit Agreement with certain exceptions. • We may not have unrestricted cash balances above $35.0 million if outstanding balances on the revolving bank credit agreement (including letters of credit) are greater than $5.0 million. • To the extent there are borrowings, they are primarily executed as Eurodollar Loans, and the applicable margins range from 3.00% to 4.00%. • The commitment fee is 50 basis points for all levels of utilization. Availability under our revolving bank credit facility is subject to a semi-annual redetermination of our borrowing base that occurs in the spring and fall of each year and is calculated by our lenders based on their evaluation of our proved reserves and their own internal criteria. The 2017 fall redetermination reaffirmed the borrowing base amount of $150.0 million. Any redetermination by our lenders to change our borrowing base will result in a similar change in the availability under our revolving bank credit facility. The revolving bank credit facility is secured and is collateralized by a first priority lien on substantially all of our oil and natural gas properties. The Credit Agreement contains various customary covenants for certain financial tests, as defined in the Credit Agreement and are measured as of the end of each quarter, and for customary events of default. The customary events of default include: (i) nonpayment of principal when due or nonpayment of interest or other amounts within three business days of when due; (ii) bankruptcy or insolvency with respect to the Company or any of its subsidiaries guaranteeing borrowings under the revolving bank credit facility; or (iii) a change of control. The Credit Agreement contains cross-default clauses with the other long-term debt agreements, and such agreements contain similar cross-default clauses with the Credit Agreement. As of March 31, 2018 and December 31, 2017, we did not have any borrowings outstanding on the revolving bank credit facility and had $0.3 million of letters of credit outstanding. Thus, available credit as of March 31, 2018 was $149.7 million. 1.5 Lien Term Loan. In September 2016, we entered into the 1.5 Lien Term Loan with a maturity date of November 15, 2019. The maturity date will accelerate to February 28, 2019 if the remaining Unsecured Senior Notes have not been extended, renewed, refunded, defeased, discharged, replaced or refinanced by February 28, 2019. Interest accrues at 11.00% per annum and is payable quarterly in cash. The 1.5 Lien Term Loan is secured by a 1.5 priority lien on all of our assets pledged under the Credit Agreement. The lien securing the 1.5 Lien Term Loan is subordinate to the liens securing the Credit Agreement and has priority above the liens securing the Second Lien Term Loan (defined below), the Second Lien PIK Toggle Notes and the Third Lien PIK Toggle Notes. All future undiscounted cash flows have been included in the carrying value under ASC 470-60. The 1.5 Lien Term Loan contains various covenants that limit, among other things, our ability to: (i) pay cash dividends; (ii) repurchase the Unsecured Senior Notes at a price greater than 65% of par and limited to a basket of $35 million; (iii) repurchase our common stock; (iv) sell our assets; (v) make certain loans or investments; (vi) merge or consolidate; (vii) enter into certain liens; (viii) create liens that secure debt; and (ix) enter into transactions with affiliates. Second Lien Term Loan. In May 2015, we entered into the 9.00% Term Loan (the “Second Lien Term Loan”), which bears an annual interest rate of 9.00%. The Second Lien Term Loan was issued at a 1.0% discount to par, matures on May 15, 2020 and is recorded at its carrying value consisting of principal, unamortized discount and unamortized debt issuance costs. Interest on the Second Lien Term Loan is payable in arrears semi-annually on May 15 and November 15. The estimated annual effective interest rate on the Second Lien Term Loan is 9.6%, which includes amortization of debt issuance costs and discounts. The Second Lien Term Loan is secured by a second-priority lien on all of our assets that are secured under the Credit Agreement. The Second Lien Term Loan is effectively subordinate to the Credit Agreement and the 1.5 Lien Term Loan (discussed above) and is effectively pari passu with the Second Lien PIK Toggle Notes (discussed below). The Second Lien Term Loan contains covenants that limit or prohibit our ability and the ability of certain of our subsidiaries to: (i) incur additional debt; (ii) make payments or distributions on account of our or our restricted subsidiaries’ capital stock; (iii) sell assets; (iv) restrict dividends or other payments of our restricted subsidiaries to us; (v) create liens that secure debt; (vi) enter into transactions with affiliates and (vii) merge or consolidate with another company. Second Lien PIK Toggle Notes. In September 2016, we issued Second Lien PIK Toggle Notes with a maturity date of May 15, 2020. Interest is payable on May 15 and November 15 of each year. The Second Lien PIK Toggle Notes contain provisions whereby certain semi-annual interest is added to the principal amount through payment-in-kind instead of being paid in cash in the then current semi-annual period. For the interest period from November 15, 2017 up to and including March 6, 2018, we elected the option to pay that portion of interest in kind at the rate of 10.75% per annum. After March 7, 2018, interest is payable in cash at the rate of 9.00% per annum. The Second Lien PIK Toggle Notes are secured by a second-priority lien on all of our assets that are pledged under the Credit Agreement. The Second Lien PIK Toggle Notes are effectively subordinate to the Credit Agreement and the 1.5 Lien Term Loan and are effectively pari passu with the Second Lien Term Loan. The Second Lien PIK Toggle Notes contain covenants that limit or prohibit our ability and the ability of certain of our subsidiaries to: (i) incur additional debt; (ii) make payments or distributions on account of our or our restricted subsidiaries’ capital stock; (iii) sell assets; (iv) restrict dividends or other payments of our restricted subsidiaries to us; (v) create liens that secure debt; (vi) enter into transactions with affiliates and (vii) merge or consolidate with another company. Third Lien PIK Toggle Notes. In September 2016, we issued Third Lien PIK Toggle Notes with a maturity date of June 15, 2021. The maturity date will accelerate to February 28, 2019 if the remaining Unsecured Senior Notes have not been extended, renewed, refunded, defeased, discharged, replaced or refinanced by February 28, 2019. Interest is payable on June 15 and December 15 of each year. The Third Lien PIK Toggle Notes contain interest provisions whereby certain semi-annual interest is added to the principal amount through payment-in-kind instead of being paid in cash in the then current semi-annual period. For interest periods up to and including September 6, 2018, if we so elect, we have the option to pay all or a portion of interest in kind at a rate of 10.00% per annum. After September 7, 2018, interest is payable in cash at the rate of 8.50% per annum. The Third Lien PIK Toggle Notes are secured by a third-priority lien on all of our assets that are secured under the Credit Agreement. The Third Lien PIK Toggle Notes are effectively subordinate to the Second Lien Term Loan and the Second Lien PIK Toggle Notes. The Third Lien PIK Toggle Notes contain covenants that limit or prohibit our ability and the ability of certain of our subsidiaries to: (i) incur additional debt; (ii) make payments or distributions on account of our or our restricted subsidiaries’ capital stock; (iii) sell assets; (iv) restrict dividends or other payments of our restricted subsidiaries to us; (v) create liens that secure debt; (vi) enter into transactions with affiliates and (vii) merge or consolidate with another company. Unsecured Senior Notes. Our outstanding Unsecured Senior Notes, which bear an annual interest rate of 8.50% and mature on June 15, 2019, were recorded at their carrying value, which includes unamortized debt premium and unamortized debt issuance costs. Interest on the Unsecured Senior Notes is payable semi-annually in arrears on June 15 and December 15. The estimated annual effective interest rate on the Unsecured Senior Notes is 8.4%, which includes amortization of premiums and debt issuance costs. The Unsecured Senior Notes contain covenants that limit or prohibit our ability and the ability of certain of our subsidiaries to: (i) incur additional debt; (ii) make payments or distributions on account of our or our restricted subsidiaries’ capital stock; (iii) sell assets; (iv) restrict dividends or other payments of our restricted subsidiaries to us; (v) create liens that secure debt; (vi) enter into transactions with affiliates and (vii) merge or consolidate with another company. Covenants. We were in compliance with all applicable covenants for all of our debt instruments as of March 31, 2018. For information about fair value measurements for our long-term debt, refer to Note 3. |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Mar. 31, 2018 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | 3. Fair Value Measurements We measure the fair value of our open derivative financial instruments by applying the income approach, using models with inputs that are classified within Level 2 of the valuation hierarchy. The fair value of the 1.5 Lien Term Loan was estimated using the carrying value of the principal as only one entity has been the holder of the 1.5 Lien Term Loan. The fair values of our Second Lien Term Loan, Second Lien PIK Toggle Notes, Third Lien PIK Toggle Notes and Unsecured Senior Notes were based on quoted prices, although the market is not a very active market; therefore, the fair value is classified within Level 2. The following table presents the fair value of our long-term debt, all of which are classified as Level 2 within the valuation hierarchy (in thousands): Hierarchy March 31, 2018 December 31, 2017 11.00% 1.5 Lien Term Loan, due November 2019 Level 2 $ 75,000 $ 75,000 9.00 % Second Lien Term Loan, due May 2020 Level 2 297,000 288,000 9.00%/10.75% Second Lien PIK Toggle Notes, due May 2020 Level 2 164,898 162,322 8.50%/10.00% Third Lien PIK Toggle Notes, due June 2021 Level 2 127,149 119,490 8.50% Unsecured Senior Notes, due June 2019 Level 2 182,236 178,439 The long-term debt items are reported on the Condensed Consolidated Balance Sheets at their carrying value as described in Note 2. |
JV Drilling Program
JV Drilling Program | 3 Months Ended |
Mar. 31, 2018 | |
Oil And Gas Exploration And Production Industries Disclosures [Abstract] | |
JV Drilling Program | 4. JV Drilling Program On March 12, 2018, W&T and two other initial members formed and initially funded a limited liability company, Monza, which will jointly participate with us in the exploration, drilling and development of up to 14 identified drilling projects in the Gulf of Mexico over the next three years. W&T contributed 88.94% of its working interest in the 14 identified projects to Monza and retained an 11.06% working interest. The projected cost to Monza to fully develop the 14 projects is estimated to be $298.6 million, excluding contingencies. Since the initial closing on March 12, 2018, additional investors have joined in Monza and as of April 27, 2018, total commitments by all investors are $297.6 million. We anticipate additional investors will join in the program. If we experience cost overruns on every project, which is unlikely, then the total cost of all projects could be as high as approximately $373 million, of which W&T would have an indirect (through Monza) cash commitment of approximately $37.5 million. One of the initial members of Monza is an entity owned and controlled by Harbourvest Partners, a Boston based private equity fund. The other initial members are W&T and an entity owned and controlled by Mr. Tracy W. Krohn, our Chairman and Chief Executive Officer. The Krohn entity invested as a minority investor on the same terms and conditions as Harbourvest Partners and its investment is limited to 4.5% of total invested capital within Monza. The entity affiliated with Mr. Krohn has made a capital commitment to Monza of $13.4 million, which commitment will be increased as and when additional investors join the JV Drilling Program up to an amount not to exceed $16.8 million. In summary, W&T owns a direct interest in the 14 drilling projects as well as an indirect interest via its interest in Monza. The JV Drilling Program is structured so that we initially receive an aggregate of 30.0% of the net revenues, through both our direct ownership of our working interest in the projects and our indirect interest through our 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. At the inception of Monza, W&T received a net reimbursement of approximately $20 million for the capital expenditures incurred prior to the close date for projects in the JV Drilling Program. W&T may fund certain cost overruns, subject to certain exceptions, on JV Drilling Program wells above budgeted amounts. We hold a variable interest in Monza, which is a variable interest entity which we account for utilizing proportional consolidation. We do not fully consolidate Monza because we are not considered the primary beneficiary. Information on the structure and relationship follows: Board Structure and Authority. Under the limited liability agreement, the business and affairs of Monza are managed by a board of five directors, which consists of three directors selected by Harbourvest and other investors, Mr. Krohn, and an additional independent director that will be selected by a majority of the investors in Monza subject to consent by W&T. The day-to-day operations of Monza are being managed by W&T, under the direction of the Monza board, pursuant to a services agreement. W&T has no control over the decisions of the Monza board. W&T has veto rights for certain decisions, but does not have the ability to unilaterally make decisions for Monza, except for day-to-day decisions as permitted under the services agreement. The Monza board is responsible for the management of Monza and for making decisions with respect to its interest in the 14 drilling projects, including approval of the budgets. Accounting Methodology and Carrying Amounts. As we are not the primary beneficiary and we do not have control of Monza, we are utilizing proportional consolidation for our interest in Monza. As of March 31, 2018 in the Condensed Consolidated Statement of Financial Position, we recorded $2.4 million in prepaid assets, $44.9 million in oil and natural gas properties, $2.4 million in other assets and $1.0 million in accounts payable in connection with our proportional interest in Monza’s assets and liabilities. Maximum Exposure. Our maximum exposure within Monza as of March 31, 2018 is $48.7 million, which consists of $6.7 million cash contributed to Monza and $42.0 million of fair value for the conveyance of the 88.94% of the Company’s working interest in the 14 projects. We may also take responsibility for certain drilling and completion cost overruns, subject to certain limitations and certain exceptions. |
Asset Retirement Obligations
Asset Retirement Obligations | 3 Months Ended |
Mar. 31, 2018 | |
Asset Retirement Obligation Disclosure [Abstract] | |
Asset Retirement Obligations | 5. Asset Retirement Obligations Our ARO primarily represents the estimated present value of the amount we will incur to plug, abandon and remediate our producing properties at the end of their productive lives. A summary of the changes to our ARO is as follows (in thousands): Balance, December 31, 2017 $ 300,446 Liabilities settled (7,022 ) Accretion of discount 4,536 Disposition of properties (297 ) Revisions of estimated liabilities (1) 8,820 Balance, March 31, 2018 306,483 Less current portion 25,748 Long-term $ 280,735 (1) Revisions were primarily related to wells that experienced sustained casing pressure issues. |
Derivative Financial Instrument
Derivative Financial Instruments | 3 Months Ended |
Mar. 31, 2018 | |
Derivative Instruments And Hedging Activities Disclosure [Abstract] | |
Derivative Financial Instruments | 6. Derivative Financial Instruments Our market risk exposure relates primarily to commodity prices and, from time to time, we use various derivative instruments to manage our exposure to this commodity price risk from sales of our oil and natural gas. All of the derivative counterparties are also lenders or affiliates of lenders participating in our revolving bank credit facility. We are exposed to credit loss in the event of nonperformance by the derivative counterparties; however, we currently anticipate that each of our derivative counterparties will be able to fulfill their contractual obligations. Additional collateral is not required by us due to the derivative counterparties’ collateral rights as lenders, and we do not require collateral from our derivative counterparties. We have elected not to designate our commodity derivative contracts as hedging instruments; therefore, all changes in the fair value of derivative contracts were recognized currently in earnings during the periods presented. The cash flows of all of our commodity derivative contracts are included in Net cash provided by operating activities As of March 31, 2018, we did not have any open commodity derivative contracts and did not enter into any derivative contracts during the three months ended March 31, 2018. During the three months ended March 31, 2017, we entered into commodity contracts for crude oil and natural gas and did not have any open commodity derivative contracts as of December 31, 2017. |
Share-Based Compensation and Ca
Share-Based Compensation and Cash-Based Incentive Compensation | 3 Months Ended |
Mar. 31, 2018 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Share-Based Compensation and Cash-Based Incentive Compensation | 7. Share-Based Compensation and Cash-Based Incentive Compensation Awards to Employees. In 2010, the W&T Offshore, Inc. Amended and Restated Incentive Compensation Plan (the “Plan”) was approved by our shareholders, and amendments to the Plan were approved by our shareholders in May 2013, May 2016 and May 2017. The May 2017 amendment increased the number of shares available in the Plan by 7,700,000 shares. As allowed by the Plan, during 2017 and 2016, the Company granted restricted stock units (“RSUs”) to certain of its employees. RSUs are a long-term compensation component of the Plan, which are granted to certain employees, and are subject to adjustments at the end of the applicable performance period based on the results of certain predetermined criteria. In addition to share-based compensation, the Company may grant to its employees cash-based incentive awards, which are a short-term component of the Plan and are typically based on the Company and the employee achieving certain pre-defined performance criteria. As of March 31, 2018, there were 13,363,792 shares of common stock available for issuance in satisfaction of awards under the Plan. The shares available for issuance are reduced when RSUs are settled in shares of common stock, net of withholding tax. The Company has the option at vesting to settle RSUs in stock or cash, or a combination of stock and cash. The Company plans to settle RSUs that vest in the future using shares of common stock. RSUs currently outstanding related to the 2017 and 2016 grants have been adjusted for performance achieved against predetermined criteria for the applicable performance year. These RSUs continue to be subject to employment-based criteria and vesting occurs in December of the second year after the grant. See the table below for potential vesting by year. We recognize compensation cost for share-based payments to employees over the period during which the recipient is required to provide service in exchange for the award. Compensation cost is based on the fair value of the equity instrument on the date of grant. The fair values for the RSUs granted during 2017 and 2016 were determined using the Company’s closing price on the grant date. We are also required to estimate forfeitures, resulting in the recognition of compensation cost only for those awards that are expected to actually vest. All RSUs awarded are subject to forfeiture until vested and cannot be sold, transferred or otherwise disposed of during the restricted period. There were no grants or vesting of RSUs during the three months ended March 31, 2018. For the outstanding RSUs issued to the eligible employees as of March 31, 2018, vesting is expected to occur as follows: Restricted Stock Units 2018 3,743,872 2019 2,022,020 Total 5,765,892 Awards to Non-Employee Directors . Under the Director Compensation Plan, shares of restricted stock (“Restricted Shares”) have been granted to the Company’s non-employee directors. Grants to non-employee directors were made during 2017, 2016 and 2015. As of March 31, 2018, there were 170,524 shares of common stock available for issuance in satisfaction of awards under the Director Compensation Plan. The shares available are reduced when Restricted Shares are granted. We recognize compensation cost for share-based payments to non-employee directors over the period during which the recipient is required to provide service in exchange for the award. Compensation cost is based on the fair value of the equity instrument on the date of grant. The fair values for the Restricted Shares granted were determined using the Company’s closing price on the grant date. No forfeitures were estimated for the non-employee directors’ awards. The Restricted Shares are subject to service conditions and vesting occurs at the end of specified service periods unless approved by the Board of Directors. Restricted Shares cannot be sold, transferred or disposed of during the restricted period. The holders of Restricted Shares generally have the same rights as a shareholder of the Company with respect to such Restricted Shares, including the right to vote and receive dividends or other distributions paid with respect to the Restricted Shares. There were no grants or vesting of Restricted Shares during the three months ended March 31, 2018. For the outstanding Restricted Shares issued to the non-employee directors as of March 31, 2018, vesting is expected to occur as follows: Restricted Shares 2018 106,240 2019 91,164 2020 49,124 Total 246,528 Share-Based Compensation. Share-based compensation expense is recorded in the line General and administrative expense s in the Condensed Consolidated Statements of Operations. A summary of incentive compensation expense under share-based payment arrangements and the related tax benefit is as follows (in thousands): Three Months Ended March 31, 2018 2017 Share-based compensation expense from: Restricted stock units $ 1,149 $ 1,858 Restricted Shares 70 70 Total $ 1,219 $ 1,928 Share-based compensation tax benefit: Tax benefit computed at the statutory rate $ 256 $ 675 Unrecognized Share-Based Compensation. As of March 31, 2018, unrecognized share-based compensation expense related to our awards of RSUs and Restricted Shares was $5.0 million and $0.3 million, respectively. Unrecognized share-based compensation expense will be recognized through November 2019 for RSUs and April 2020 for Restricted Shares. Cash-Based Incentive Compensation. In addition to share-based compensation, cash-based awards were granted under the Plan to substantially all eligible employees in 2017 and 2016. The cash-based awards, which are a short-term component of the Plan, are performance-based awards consisting of one or more business criteria or individual performance criteria and a targeted level or levels of performance with respect to each such criterion. In addition, these cash-based awards included an additional financial condition requiring Adjusted EBITDA less reported Interest Expense Incurred (as defined in the awards) for any fiscal quarter plus the three preceding quarters to exceed defined levels measured over defined time periods for each cash-based award. Expense is recognized over the service period once the business criteria, individual performance criteria and financial condition are met. • For the 2017 cash-based awards, a portion of the business criteria and individual performance criteria were achieved. The financial condition requirement of Adjusted EBITDA less reported Interest Expense Incurred exceeding $200 million over four consecutive quarters was achieved; therefore, incentive compensation expense was recognized in 2017 and in the first two months of 2018 for the 2017 cash-based awards. Payments were made in March 2018. • For the 2016 cash-based awards, the financial condition requirement of Adjusted EBITDA less reported Interest Expense Incurred exceeding $300 million over four consecutive quarters was not achieved as of March 31, 2018; therefore no expense was recognized during the three months ended March 31, 2018 or during 2017. The terms of the 2016 cash-based awards allow for the achievement of the financial condition up through December 31, 2018. If the financial condition is achieved, payment is to be made within 30 days of achievement of the financial condition. A summary of compensation expense related to share-based awards and cash-based awards is as follows (in thousands): Three Months Ended March 31, 2018 2017 Share-based compensation included in: General and administrative expenses $ 1,219 $ 1,928 Cash-based incentive compensation included in: Lease operating expense 860 — General and administrative expenses 2,672 — Total charged to operating income $ 4,751 $ 1,928 |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 8. Income Taxes Our income tax expense for the three months ended March 31, 2018 was $0.1 million and our income tax benefit for the three months ended March 31, 2017 was $7.6 million. Our effective tax rate was not meaningful for either period presented. The income tax expense in the three months ended March 31, 2018 represents the interest on uncertain tax positions. Excluding this adjustment, tax expense would have been zero for the three months ended March 31, 2018. Our current full-year forecast for 2018 has a net operating loss for tax purposes; therefore, no current tax expense is recorded. In addition, no deferred income tax expense is recorded due to dollar-for-dollar offsets by our valuation allowance. The income tax benefit for the three months ended March 31, 2017 relates to net operating loss carryback claims made pursuant to Internal Revenue Code (“IRC”) During the three months ended March 31, 2018 and 2017, we did not receive any income tax refunds and made no income tax payments of significance. As of March 31, 2018, we recorded current income taxes receivable of $65.1 million. As of December 31, 2017, the balance sheet reflects current income taxes receivable of $13.0 million and non-current income taxes receivable of $52.1 million. The receivables primarily relate to a net operating loss claim carried back for 2017 and net operating loss claims for the years 2012, 2013 and 2014 that were carried back to prior years. These carryback claims are made pursuant to IRC Section 172(f) described above. The refund claims for the years 2012, 2013 and 2014 require a review by the Congressional Joint Committee on Taxation. As of March 31, 2018 and December 31, 2017, our valuation allowance was $165.7 million and $171.5 million, respectively, related to federal and state deferred tax assets. Net deferred tax assets were recorded related to NOLs and temporary differences between the book and tax basis of assets and liabilities expected to produce tax deductions in future periods. The realization of these assets depends on recognition of sufficient future taxable income in specific tax jurisdictions in which those temporary differences or net operating losses are deductible. We recognize interest and penalties related to unrecognized tax benefits in income tax expense. During the three months ended March 31, 2018 and 2017, we recorded immaterial amounts of accrued interest expense related to our unrecognized tax benefits. For the first quarter of 2018, the amount reported as income tax expense is entirely attributable to this accrued interest. The tax years 2013 through 2017 remain open to examination by the tax jurisdictions to which we are subject. |
Earnings_ (Loss) Per Share
Earnings/ (Loss) Per Share | 3 Months Ended |
Mar. 31, 2018 | |
Earnings Per Share [Abstract] | |
Earnings/ (Loss) Per Share | 9. Earnings Per Share The following table presents the calculation of basic and diluted earnings per common share (in thousands, except per share amounts): Three Months Ended March 31, 2018 2017 Net income $ 27,640 $ 24,299 Less portion allocated to nonvested shares 1,145 1,058 Net income allocated to common shares $ 26,495 $ 23,241 Weighted average common shares outstanding 138,845 137,513 Basic and diluted earnings per common share $ 0.19 $ 0.17 |
Contingencies
Contingencies | 3 Months Ended |
Mar. 31, 2018 | |
Commitments And Contingencies Disclosure [Abstract] | |
Contingencies | 10. Contingencies Apache Lawsuit. On December 15, 2014, Apache filed a lawsuit against the Company alleging that W&T breached the joint operating agreement related to, among other things, the abandonment of three deepwater wells in the Mississippi Canyon (“MC”) area of the Gulf of Mexico. A trial court judgment was rendered from the U.S. District Court for the Southern District of Texas on May 31, 2017 directing the Company to pay Apache $43.2 million, plus $6.3 million in prejudgment interest, attorney's fees and costs assessed in the judgment. We filed an appeal of the trial court judgment in the U.S. Court of Appeals for the Fifth Circuit. Prior to filing the appeal, in order to stay execution of the judgment, we deposited $49.5 million with the registry of the court in June 2017. The deposit of $49.5 million with the registry of the court is recorded in Other assets ( Other liabilities Appeal with the Office of Natural Resources Revenue (“ONRR”). In 2009, we recognized allowable reductions of cash payments for royalties owed to the ONRR for transportation of their deepwater production through our subsea pipeline systems. In 2010, the ONRR audited our calculations and support related to this usage fee, and in 2010, we were notified that the ONRR had disallowed approximately $4.7 million of the reductions taken. We recorded a reduction to other revenue in 2010 to reflect this disallowance; however, we disagree with the position taken by the ONRR. We filed an appeal with the ONRR, which was denied in May 2014. On June 17, 2014, we filed an appeal with the Interior Board of Land Appeals (“IBLA”) under the Department of the Interior. On January 27, 2017, the IBLA affirmed the decision of the ONRR requiring W&T to pay approximately $4.7 million in additional royalties. We filed an appeal of the IBLA decision on July 25, 2017 in the U.S. District Court for the Eastern District of Louisiana. We were required to post a bond in the amount of $7.2 million and cash collateral of $6.9 million in order to appeal the IBLA decision. Royalties – “Unbundling” Initiative. The ONRR has publicly announced an “unbundling” initiative to revise the methodology employed by producers in determining the appropriate allowances for transportation and processing costs that are permitted to be deducted in determining royalties under Federal oil and gas leases. The ONRR’s initiative requires re-computing allowable transportation and processing costs using revised guidance from the ONRR going back 84 months for every gas processing plant that processed our gas. In the second quarter of 2015, pursuant to the initiative, we received requests from the ONRR for additional data regarding our transportation and processing allowances on natural gas production related to a specific processing plant. We also received a preliminary determination notice from the ONRR asserting that our allocation of certain processing costs and plant fuel use at another processing plant was not allowed as deductions in the determination of royalties owed under Federal oil and gas leases. We have submitted revised calculations covering certain plants and time periods to the ONRR. As of the filing date of this Form 10-Q, we have not received a response from the ONRR related to our submissions. These open ONRR unbundling reviews, and any further similar reviews, could ultimately result in an order for payment of additional royalties under our Federal oil and gas leases for current and prior periods. For the three months ended March 31, 2018 and 2017, we paid additional royalty payments of less than $0.1 million and $0.7 million, respectively. We are not able to determine the range of any additional royalties or, if and when assessed, whether such amounts would be material. Notices of Proposed Civil Penalty Assessment. During the three months ended March 31, 2018 and 2017, we did not pay any civil penalties to the Bureau of Safety and Environmental Enforcement (“BSEE”) related to Incidents of Noncompliance (“INCs”) at various offshore locations. We currently have five open civil penalties issued by the BSEE from INCs, which have not been settled as of the filing date of this Form 10-Q. The INC’s underlying the civil penalties relate to separate offshore locations with occurrence dates ranging from July 2012 to June 2014. The proposed civil penalties for these INCs total $7.8 million. We have accrued approximately $3.3 million as of March 31, 2018, which is our best estimate of the final settlements once all appeals have been exhausted. Our position is that the proposed civil penalties are excessive given the specific facts and circumstances related to these INCs. Surety Bond Collateral. The issuers of surety bonds in some cases have requested and received additional collateral related to surety bonds for plugging and abandonment activities. We may be required to post collateral at any time pursuant to the terms of our agreement with various sureties under our existing bonds, if they so demand at their discretion. We did not receive any collateral demands from surety bond providers during the three months ended March 31, 2018. Other Claims. We are a party to various pending or threatened claims and complaints seeking damages or other remedies concerning our commercial operations and other matters in the ordinary course of our business. In addition, claims or contingencies may arise related to matters occurring prior to our acquisition of properties or related to matters occurring subsequent to our sale of properties. In certain cases, we have indemnified the sellers of properties we have acquired, and in other cases, we have indemnified the buyers of properties we have sold. We are 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 we can give no assurance about the outcome of pending legal and federal or state administrative proceedings and the effect such an outcome may have on us, we believe 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 our consolidated financial position, results of operations or liquidity. |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2018 | |
Subsequent Events [Abstract] | |
Subsequent Events | 11. Subsequent Events Heidelberg Field Acquisition. On April 5, 2018, we closed on the acquisition in the Heidelberg field whereby we acquired a 9.375% non-operated, working interest in Green Canyon blocks 859, 903 and 904. The gross purchase price was $31.1 million which was adjusted for certain closing items and an effective date of January 1, 2018. Cash flows generated by the acquired interest between the effective date and the closing date will serve to reduce the final purchase price. The acquisition required the issuance of a letter of credit of $9.4 million to a pipeline company as consignee and which issuance required a cash deposit of approximately $4.7 million with the lead bank under our Credit Agreement (representing the amount of letters of credit in excess of $5.0 million). Under our Credit Agreement, letters of credit are considered borrowings and we cannot have more than $5.0 million borrowed if we have more than $35.0 million of cash on hand (anti-hoarding provision). JV Drilling Program. Subsequent to March 31, 2018 and up to the filing date of this Form 10-Q, five additional third-party investors made commitments to the JV Drilling Program, bringing the total commitment to approximately $297.6 million. These additional investors are subject to the same terms and conditions as the original investors. These additional commitments will not change the Company’s proportional interest in Monza, as additional contributions will be made by the Company to maintain its current percentage. |
Supplemental Guarantor Informat
Supplemental Guarantor Information | 3 Months Ended |
Mar. 31, 2018 | |
Supplemental Guarantor Information [Abstract] | |
Supplemental Guarantor Information | 12. Supplemental Guarantor Information Our payment obligations under the Credit Agreement, the 1.5 Lien Term Loan, the Second Lien Term Loan, the Second Lien PIK Toggle Notes, the Third Lien PIK Toggle Notes and the Unsecured Senior Notes (see Note 2) are fully and unconditionally guaranteed by certain of our 100%-owned subsidiaries, including Energy VI and W & T Energy VII, LLC (together, the “Guarantor Subsidiaries”). W & T Energy VII, LLC does not currently have any active operations or contain any assets. Guarantees will be released under certain circumstances, including: (1) in connection with any sale or other disposition of all or substantially all of the assets of a Guarantor Subsidiary (including by way of merger or consolidation) to a person that is not (either before or after giving effect to such transaction) the Company or a Restricted Subsidiary, if the sale or other disposition does not violate the Asset Sale provisions (as such capitalized terms are defined in the applicable indenture); (2) in connection with any sale or other disposition of the capital stock of such Guarantor Subsidiary to a person that is not (either before or after giving effect to such transaction) the Company or a Restricted Subsidiary of the Company, if the sale or other disposition does not violate the Asset Sale provisions of the indenture and the Guarantor Subsidiary ceases to be a subsidiary of the Company as a result of such sales or disposition; (3) if such Guarantor Subsidiary is a Restricted Subsidiary and the Company designates such Guarantor Subsidiary as an Unrestricted Subsidiary in accordance with the applicable provisions of certain debt documents; (4) upon Legal Defeasance or Covenant Defeasance (as such terms are defined in the applicable indenture) or upon satisfaction and discharge of the certain debt documents; (5) upon the liquidation or dissolution of such Guarantor Subsidiary, provided no event of default has occurred and is continuing; or (6) at such time as such Guarantor Subsidiary is no longer required to be a Guarantor Subsidiary as described in certain debt documents, provided no event of default has occurred and is continuing. The following condensed consolidating financial information presents the financial condition, results of operations and cash flows of the Parent Company and the Guarantor Subsidiaries, together with consolidating adjustments necessary to present the Company’s results on a consolidated basis. As a result of the JV Drilling Program, we recorded proportional consolidation adjustments, which are not considered a guarantor asset under our debt agreements and, accordingly, are reported as non-guarantor adjustments in the following tables. Due to the methodology of recording the ceiling-test write down in prior periods, consolidating adjustments are required to present the consolidated results appropriately. Condensed Consolidating Balance Sheet as of March 31, 2018 Consolidated Parent Guarantor Non-Guarantor W&T Company Subsidiaries Adjustments Eliminations Offshore, Inc. (In thousands) Assets Current assets: Cash and cash equivalents $ 130,711 $ — $ — $ — $ 130,711 Receivables: Oil and natural gas sales 3,842 41,100 — — 44,942 Joint interest 17,835 — — — 17,835 Income taxes 186,134 — — (121,031 ) 65,103 Total receivables 207,811 41,100 — (121,031 ) 127,880 Prepaid expenses and other assets 14,592 3,206 2,399 — 20,197 Total current assets 353,114 44,306 2,399 (121,031 ) 278,788 Oil and natural gas properties and other, net 406,308 128,745 44,947 (6,648 ) 573,352 Restricted deposits for asset retirement obligations 25,622 — — — 25,622 Other assets 577,871 503,839 (46,378 ) (970,918 ) 64,414 Total assets $ 1,362,915 $ 676,890 $ 968 $ (1,098,597 ) $ 942,176 Liabilities and Shareholders’ Equity (Deficit) Current liabilities: Accounts payable $ 70,997 $ 5,477 $ 970 $ — $ 77,444 Undistributed oil and natural gas proceeds 20,598 1,675 — — 22,273 Asset retirement obligations 23,635 2,113 — — 25,748 Long-term debt 22,858 — — — 22,858 Accrued liabilities 23,437 120,887 — (121,031 ) 23,293 Total current liabilities 161,525 130,152 970 (121,031 ) 171,616 Long-term debt: Principal 889,790 — — — 889,790 Carrying value adjustments 77,691 — — — 77,691 Long term debt, less current portion - carrying value 967,481 — — — 967,481 Asset retirement obligations, less current portion 154,861 125,862 12 — 280,735 Other liabilities 617,034 — — (550,041 ) 66,993 Shareholders’ deficit: Common stock 1 — — — 1 Additional paid-in capital 547,039 704,885 — (704,885 ) 547,039 Retained earnings (deficit) (1,060,859 ) (284,009 ) (14 ) 277,360 (1,067,522 ) Treasury stock, at cost (24,167 ) — — — (24,167 ) Total shareholders’ equity (deficit) (537,986 ) 420,876 (14 ) (427,525 ) (544,649 ) Total liabilities and shareholders’ equity (deficit) $ 1,362,915 $ 676,890 $ 968 $ (1,098,597 ) $ 942,176 Condensed Consolidating Balance Sheet as of December 31, 2017 Consolidated Parent Guarantor W&T Company Subsidiaries Eliminations Offshore, Inc. (In thousands) Assets Current assets: Cash and cash equivalents $ 99,058 $ — $ — $ 99,058 Receivables: Oil and natural gas sales 5,665 39,778 — 45,443 Joint interest 19,754 — — 19,754 Income taxes 128,835 — (115,829 ) 13,006 Total receivables 154,254 39,778 (115,829 ) 78,203 Prepaid expenses and other assets 11,154 2,265 — 13,419 Total current assets 264,466 42,043 (115,829 ) 190,680 Oil and natural gas properties and other, net 430,354 152,464 (3,802 ) 579,016 Restricted deposits for asset retirement obligations 25,394 — — 25,394 Income taxes receivable 52,097 — — 52,097 Other assets 505,304 453,306 (898,217 ) 60,393 Total assets $ 1,277,615 $ 647,813 $ (1,017,848 ) $ 907,580 Liabilities and Shareholders’ Deficit Current liabilities: Accounts payable $ 76,703 $ 6,962 $ — $ 83,665 Undistributed oil and natural gas proceeds 18,762 1,367 — 20,129 Asset retirement obligations 22,488 1,125 — 23,613 Long-term debt 22,925 — — 22,925 Accrued liabilities 18,058 115,701 (115,829 ) 17,930 Total current liabilities 158,936 125,155 (115,829 ) 168,262 Long-term debt: Principal 889,790 — — 889,790 Carrying value adjustments 79,337 — — 79,337 Long term debt, less current portion - carrying value 969,127 — — 969,127 Asset retirement obligations, less current portion 152,883 123,950 — 276,833 Other liabilities 566,375 — (499,509 ) 66,866 Shareholders’ deficit: Common stock 1 — — 1 Additional paid-in capital 545,820 704,885 (704,885 ) 545,820 Retained earnings (deficit) (1,091,360 ) (306,177 ) 302,375 (1,095,162 ) Treasury stock, at cost (24,167 ) — — (24,167 ) Total shareholders’ deficit (569,706 ) 398,708 (402,510 ) (573,508 ) Total liabilities and shareholders’ deficit $ 1,277,615 $ 647,813 $ (1,017,848 ) $ 907,580 Condensed Consolidating Statement of Operations for the Three Months Ended March 31, 2018 Consolidated Parent Guarantor Non-Guarantor W&T Company Subsidiaries Adjustments Eliminations Offshore, Inc. (In thousands) Revenues $ 63,786 $ 70,427 $ — $ — $ 134,213 Operating costs and expenses: Lease operating expenses 19,760 17,083 — — 36,843 Production taxes 455 — — — 455 Gathering and transportation 2,703 2,354 — — 5,057 Depreciation, depletion, amortization and accretion 19,420 15,814 — 2,847 38,081 General and administrative expenses 7,203 7,824 11 — 15,038 Total costs and expenses 49,541 43,075 11 2,847 95,474 Operating income 14,245 27,352 (11 ) (2,847 ) 38,739 Earnings of affiliates 22,167 — — (22,167 ) — Interest expense incurred 11,323 — — — 11,323 Other (income) expense, net (336 ) — 3 — (333 ) Income before income tax expense (benefit) 25,425 27,352 (14 ) (25,014 ) 27,749 Income tax expense (benefit) (5,076 ) 5,185 — — 109 Net income $ 30,501 $ 22,167 $ (14 ) $ (25,014 ) $ 27,640 Condensed Consolidating Statement of Operations for the Three Months Ended March 31, 2017 Consolidated Parent Guarantor W&T Company Subsidiaries Eliminations Offshore, Inc. (In thousands) Revenues $ 53,707 $ 70,686 $ — $ 124,393 Operating costs and expenses: Lease operating expenses 23,702 16,462 — 40,164 Production taxes 515 — — 515 Gathering and transportation 2,566 3,643 — 6,209 Depreciation, depletion, amortization and accretion 19,154 20,105 731 39,990 General and administrative expenses 5,776 7,498 — 13,274 Derivative gain (3,955 ) — — (3,955 ) Total costs and expenses 47,758 47,708 731 96,197 Operating income 5,949 22,978 (731 ) 28,196 Earnings of affiliates 17,527 — (17,527 ) — Interest expense incurred 11,294 — — 11,294 Other expense, net 191 — — 191 Income before income tax expense (benefit) 11,991 22,978 (18,258 ) 16,711 Income tax expense (benefit) (13,039 ) 5,451 — (7,588 ) Net income $ 25,030 $ 17,527 $ (18,258 ) $ 24,299 Condensed Consolidating Statement of Cash Flows for the Three Months Ended March 31, 2018 Consolidated W&T Parent Guarantor Non-Guarantor Offshore, Company Subsidiaries Adjustments Eliminations Inc. (In thousands) Operating activities: Net income $ 30,501 $ 22,167 $ (14 ) $ (25,014 ) $ 27,640 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation, depletion, amortization and accretion 19,420 15,814 — 2,847 38,081 Amortization of debt items 466 — — — 466 Share-based compensation 1,219 — — — 1,219 Deferred income taxes 109 — — — 109 Earnings of affiliates (22,167 ) — — 22,167 — Changes in operating assets and liabilities: — Oil and natural gas receivables 1,823 (1,322 ) — — 501 Joint interest receivables 1,919 — — — 1,919 Income taxes (5,186 ) 5,186 — — — Prepaid expenses and other assets 25,275 (31,783 ) 1,991 (1,874 ) (6,391 ) Asset retirement obligation settlements (5,633 ) (1,389 ) — — (7,022 ) Cash advances from JV partners 13,129 6,018 — — 19,147 Accounts payable, accrued liabilities and other 2,403 (4,965 ) - 1,874 (688 ) Net cash provided by operating activities 63,278 9,726 1,977 — 74,981 Investing activities: Investment in oil and natural gas properties and equipment (10,674 ) (7,496 ) (2,947 ) — (21,117 ) Changes in operating assets and liabilities associated with investing activities (15,894 ) (2,230 ) 970 — (17,154 ) Deposit for acquisition (3,000 ) — — — (3,000 ) Net cash used in investing activities (29,568 ) (9,726 ) (1,977 ) — (41,271 ) Financing activities: Payment of interest on 1.5 Lien Term Loan (2,057 ) — — — (2,057 ) Net cash used in financing activities (2,057 ) — — — (2,057 ) Increase in cash and cash equivalents 31,653 — — — 31,653 Cash and cash equivalents, beginning of period 99,058 — — — 99,058 Cash and cash equivalents, end of period $ 130,711 $ — $ — $ — $ 130,711 Condensed Consolidating Statement of Cash Flows for the Three Months Ended March 31, 2017 Consolidated W&T Parent Guarantor Offshore, Company Subsidiaries Eliminations Inc. (In thousands) Operating activities: Net income $ 25,030 $ 17,527 $ (18,258 ) $ 24,299 Adjustments to reconcile net loss to net cash provided by operating activities: Depreciation, depletion, amortization and accretion 19,154 20,105 731 39,990 Amortization of debt items 412 — — 412 Share-based compensation 1,928 — — 1,928 Derivative gain (3,955 ) — — (3,955 ) Cash receipts on derivative settlements 713 — — 713 Deferred income taxes 105 — — 105 Earnings of affiliates (17,527 ) — 17,527 — Changes in operating assets and liabilities: Oil and natural gas receivables (2,004 ) 122 — (1,882 ) Joint interest receivables 5,042 — — 5,042 Insurance reimbursements 30,100 — — 30,100 Income taxes (5,451 ) 5,451 — — Prepaid expenses and other assets (6,927 ) (42,395 ) 41,350 (7,972 ) Asset retirement obligations (12,940 ) (1,559 ) — (14,499 ) Cash advances from JV partners (2,531 ) — — (2,531 ) Accounts payable, accrued liabilities and other 49,295 1,488 (41,350 ) 9,433 Net cash provided by operating activities 80,444 739 — 81,183 Investing activities: Investment in oil and natural gas properties and equipment (23,593 ) 255 — (23,338 ) Changes in operating assets and liabilities associated with investing activities 2,162 (994 ) — 1,168 Purchases of furniture, fixtures and other (853 ) — — (853 ) Net cash used in investing activities (22,284 ) (739 ) — (23,023 ) Financing activities: Payment of interest on 1.5 Lien Term Loan (2,056 ) — — (2,056 ) Other (245 ) — — (245 ) Net cash provided by financing activities (2,301 ) — — (2,301 ) Increase in cash, cash equivalents and restricted cash 55,859 — — 55,859 Cash and cash equivalents, beginning of period 70,236 — — 70,236 Cash and cash equivalents, end of period $ 126,095 $ — $ — $ 126,095 |
Basis of Presentation (Policies
Basis of Presentation (Policies) | 3 Months Ended |
Mar. 31, 2018 | |
Accounting Policies [Abstract] | |
Operations | Operations. W&T Offshore, Inc. (with subsidiaries referred to herein as “W&T,” “we,” “us,” “our,” or 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. Our interests in fields, leases, structures and equipment are primarily owned by W&T Offshore, Inc. (on a stand-alone basis, the “Parent Company”) and its 100%-owned subsidiary, W & T Energy VI, LLC (“Energy VI”) and through our proportionately consolidated interest in Monza Energy LLC, as described in more detail below under the subheading “-Recent Events” in this Note and in Note 4 herein. |
Interim Financial Statements | Interim Financial Statements. The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim periods and the appropriate rules and regulations of the Securities and Exchange Commission (“SEC”). Accordingly, the condensed consolidated financial statements do not include all of the information and footnote disclosures required by GAAP for complete financial statements for annual periods. 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 the Company’s Annual Report on Form 10-K for the year ended December 31, 2017. |
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. |
Recent Events | Recent Events. The price we receive for our crude oil, natural gas liquids (“NGLs”) and natural gas production directly affects our revenues, profitability, cash flows, liquidity, access to capital, proved reserves and future rate of growth. The average realized prices of these commodities improved during the three months ended March 31, 2018 compared to the average realized prices in the three months ended March 31, 2017. Operating costs were lower for the three months ended March 31, 2018 on an absolute basis compared to the three months ended March 31, 2017. Our Fifth Amended and Restated Credit Agreement (as amended, the “Credit Agreement”) provides our revolver bank credit facility and matures on November 8, 2018. As of March 31, 2018, we had $0.3 million of letters of credit outstanding and no amounts borrowed on our revolving bank credit facility. Our 8.500% Senior Notes (the “Unsecured Senior Notes”) mature on June 15, 2019. If the Unsecured Senior Notes have not been extended, refunded, defeased, discharged, replaced or refinanced by February 28, 2019, then the 11.00% 1.5 Lien Term Loan, due November 15, 2019 (the “1.5 Lien Term Loan”) and the 8.50%/10.00% Third Lien Payment-In-Kind (“PIK”) Toggle Notes, due June 15, 2021, (the “Third Lien PIK Toggle Notes”) will both accelerate their maturity to February 28, 2019. During the remainder of 2018, we plan to address the issues of the potential maturity acceleration of these two debt instruments and to extend or replace the revolving bank credit facility. We expect to build sufficient cash balances in 2018 to be able to redeem, repurchase or refinance the Unsecured Senior Notes. Certain amendments under the Credit Agreement and the 1.5 Lien Term Loan will likely be required in the event we redeem or repurchase the Unsecured Senior Notes, which we anticipate would be granted if requested. Assuming we can also repay or refinance the 1.5 Lien Term Loan, then we believe that we would amend our revolving bank credit facility in such a manner that will permit an extension of the maturity of such facility. There can be no assurance that lenders will extend our revolving bank credit facility maturity, but under current market conditions and based on the outlook of our cash position in 2018 and further, we believe our lenders or replacement lenders will be amenable to participating in a refinancing or other corporate financing transaction. On March 12, 2018, W&T and two initial members formed and initially funded a limited liability company, Monza Energy LLC, a Delaware limited liability company (“Monza”), that will jointly participate with us in the exploration, drilling and development of up to 14 identified drilling projects (the “JV Drilling Program”) in the Gulf of Mexico over the next three years. W&T contributed 88.94% of its working interest in the 14 identified projects to Monza and retained an 11.06% working interest. Since the initial closing, additional investors have joined in Monza and as of April 27, 2018, total commitments by all investors are $297.6 million. We anticipate additional investors will join in the program. In summary, W&T owns a direct interest in the 14 drilling projects as well as an indirect interest via its interest in Monza. The JV Drilling Program is structured so that we initially receive an aggregate of 30.0% of the net revenues, through both our direct ownership of our working interest in the projects and our indirect interest through our 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. See Note 4 and Note 11 for additional information. We have assessed our financial condition, the current capital markets and options given different scenarios of commodity prices. We believe we will have adequate available liquidity to fund our operations through May 2019, the period of assessment to qualify as a going concern. However, we cannot predict the potential changes in commodity prices or future Bureau of Ocean Energy Management (“BOEM”) bonding requirements, either of which could affect our operations, liquidity levels and compliance with debt covenants. See our Annual Report on Form 10-K for the year ended December 31, 2017 concerning risks related to our business and events occurring during 2017 and other information and the Notes herein for additional information. |
Accounting Standard Updates Effective January 1, 2018 | Accounting Standard Updates Effective January 1, 2018. Accounting Standards Update No. 2016-18, (“ASU 2016-18”), Statement of Cash Flows (Topic 230) – Restricted Cash became effective for us in the period ending March 31, 2018. As we did not have any amounts recorded as restricted cash in the three months ended March 31, 2018, or any amounts recorded as restricted cash during 2017, ASU 2016-18 did not affect the Condensed Consolidated Statement of Cash Flows. Accounting Standard Update No. 2014-09, (“ASU 2014-09”) Revenue from Customers (Topic 606) |
Revenue Recognition | Revenue Recognition . We recognize revenue from the sale of crude oil, NGLs, and natural gas when our performance obligations are satisfied. Our contracts with customers are primarily short-term (less than 12 months). Our responsibilities to deliver a unit of crude oil, NGL, and natural gas under these contracts represent separate, distinct performance obligations. These performance obligations are satisfied at the point in time control of each unit is transferred to the customer. Pricing is primarily determined utilizing a particular pricing or market index, plus or minus adjustments reflecting quality or location differentials. |
Reclassification | Reclassification. Certain reclassifications have been made to prior periods’ financial statements to conform to the current presentation as follows: Within the Net Cash Provided by Operating Activities of the Condensed Consolidated Statements of Cash Flows, adjustments were made to certain line items, of which did not change the total amount previous reported. The adjustments did not affect the Condensed Consolidated Balance Sheets or the Condensed Consolidated Statements of Operations. |
Prepaid Expenses And Other Assets | Prepaid Expenses and Other Assets. The a mounts recorded are expected to be realized within one year and the major categories are presented in the following table (in thousands): March 31, December 31, 2018 2017 Prepaid/accrued insurance $ 1,983 $ 2,401 Surety bond unamortized premiums 3,387 2,676 Prepaid deposits related to royalties 7,451 6,456 Deposit related to an acquisition 3,000 — Proportional consolidation of Monza prepaids (Note 4) 2,399 — Other 1,977 1,886 Prepaid expenses and other assets $ 20,197 $ 13,419 |
Oil and Natural Gas Properties and Other, Net - at Cost | Oil and Natural Gas Properties and Other, Net – at cost. March 31, December 31, 2018 2017 Oil and natural gas properties and equipment $ 8,129,924 $ 8,102,044 Furniture, fixtures and other 21,831 21,831 Total property and equipment 8,151,755 8,123,875 Less accumulated depreciation, depletion and amortization 7,578,403 7,544,859 Oil and natural gas properties and other, net $ 573,352 $ 579,016 |
Accrued Liabilities | Accrued Liabilities. The major categories are presented in the following table (in thousands): March 31, December 31, 2018 2017 Accrued interest $ 14,889 $ 4,200 Accrued salaries/payroll taxes/benefits 2,577 2,454 Incentive compensation plans 1,993 7,366 Litigation accruals 3,480 3,480 Other 354 430 Total accrued liabilities $ 23,293 $ 17,930 |
Other Assets (Long-term) | Other Assets (long-term). The major categories are presented in the following table (in thousands) : March 31, December 31, 2018 2017 Escrow deposit - Apache lawsuit $ 49,500 $ 49,500 Appeal bond deposits 6,925 6,925 Investment in White Cap, LLC 2,593 2,511 Unamortized brokerage fee for Monza 1,724 — Proportional consolidation of Monza other assets (Note 4) 2,387 — Other 1,285 1,457 Total other assets $ 64,414 $ 60,393 |
Other Liabilities (Long-term) | Other Liabilities (long-term). The major categories are presented in the following table (in thousands): March 31, December 31, 2018 2017 Apache lawsuit $ 49,500 $ 49,500 Uncertain tax positions including interest/penalties 11,124 11,015 Other 6,369 6,351 Total other liabilities (long-term) $ 66,993 $ 66,866 |
Recent Accounting Developments | Recent Accounting Developments. In February 2016, the FASB issued Accounting Standards Update No. 2016-02 (“ASU 2016-02”), Leases ( Subtopic 842 ). Under the new guidance, a lessee will be required to recognize assets and liabilities for leases with lease terms of more than 12 months. Consistent with current GAAP, the recognition, measurement and presentation of expenses and cash flows arising from a lease by a lessee primarily will depend on its classification as a financing or operating lease. However, unlike current GAAP, which requires only capital or financing leases to be recognized on the balance sheet, ASU 2016-02 will require both types of leases to be recognized on the balance sheet. ASU 2016-02 also will require disclosures to help investors and other financial statement users to better understand the amount, timing and uncertainty of cash flows arising from leases. These disclosures include qualitative and quantitative requirements, providing additional information about the amounts recorded in the financial statements. ASU 2016-02 does not apply for leases for oil and gas properties, but does apply to equipment used to explore and develop oil and gas resources. ASU 2016-02 is effective for annual and interim periods beginning after December 15, 2018 and is to be applied using the modified retrospective approach. Our current operating leases that will be impacted by ASU 2016-02 are leases for office space, which is primarily in Houston, Texas, although ASU 2016-02 may impact the accounting for leases related to equipment depending on the term of the lease. We currently do not have any leases classified as financing leases nor do we have any leases recorded on the Condensed Consolidated Balance Sheets. We have not yet fully determined or quantified the effect ASU 2016-02 will have on our financial statements. In June 2016, the FASB issued Accounting Standards Update No. 2016-13, (“ASU 2016-13”), Financial Instruments – Credit Losses Subtopic 326 In August 2017, the FASB issued Accounting Standards Update No. 2017-12, (“ASU 2017-12”), Derivatives and Hedging (Topic 815) – Targeted Improvements to Accounting for Hedging Activities |
Basis of Presentation (Tables)
Basis of Presentation (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Accounting Policies [Abstract] | |
Schedule of Amounts Recorded in Prepaid Expenses and Other Assets | The amounts recorded are expected to be realized within one year and the major categories are presented in the following table (in thousands): March 31, December 31, 2018 2017 Prepaid/accrued insurance $ 1,983 $ 2,401 Surety bond unamortized premiums 3,387 2,676 Prepaid deposits related to royalties 7,451 6,456 Deposit related to an acquisition 3,000 — Proportional consolidation of Monza prepaids (Note 4) 2,399 — Other 1,977 1,886 Prepaid expenses and other assets $ 20,197 $ 13,419 |
Schedule of Oil and Natural Gas Properties and other, Net at Cost | Oil and Natural Gas Properties and Other, Net – at cost. March 31, December 31, 2018 2017 Oil and natural gas properties and equipment $ 8,129,924 $ 8,102,044 Furniture, fixtures and other 21,831 21,831 Total property and equipment 8,151,755 8,123,875 Less accumulated depreciation, depletion and amortization 7,578,403 7,544,859 Oil and natural gas properties and other, net $ 573,352 $ 579,016 |
Schedule of Accrued Liabilities | The major categories are presented in the following table (in thousands): March 31, December 31, 2018 2017 Accrued interest $ 14,889 $ 4,200 Accrued salaries/payroll taxes/benefits 2,577 2,454 Incentive compensation plans 1,993 7,366 Litigation accruals 3,480 3,480 Other 354 430 Total accrued liabilities $ 23,293 $ 17,930 |
Schedule of Other Assets (Long-term) | The major categories are presented in the following table (in thousands) March 31, December 31, 2018 2017 Escrow deposit - Apache lawsuit $ 49,500 $ 49,500 Appeal bond deposits 6,925 6,925 Investment in White Cap, LLC 2,593 2,511 Unamortized brokerage fee for Monza 1,724 — Proportional consolidation of Monza other assets (Note 4) 2,387 — Other 1,285 1,457 Total other assets $ 64,414 $ 60,393 |
Schedule of Other Liabilities (Long-term) | The major categories are presented in the following table (in thousands): March 31, December 31, 2018 2017 Apache lawsuit $ 49,500 $ 49,500 Uncertain tax positions including interest/penalties 11,124 11,015 Other 6,369 6,351 Total other liabilities (long-term) $ 66,993 $ 66,866 |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Debt Disclosure [Abstract] | |
Long-Term Debt | The components of our long-term debt are presented in the following table (in thousands): March 31, 2018 December 31, 2017 Adjustments to Adjustments to Carrying Carrying Carrying Carrying Principal Value (1) Value Principal Value (1) Value 11.00% 1.5 Lien Term Loan, due November 2019: Principal $ 75,000 $ — $ 75,000 $ 75,000 $ — $ 75,000 Future interest payments — 13,539 13,539 — 15,596 15,596 Subtotal 75,000 13,539 88,539 75,000 15,596 90,596 9.00 % Second Lien Term Loan, due May 2020: 300,000 — 300,000 300,000 — 300,000 9.00%/10.75% Second Lien PIK Toggle Notes, due May 2020: Principal 171,769 — 171,769 171,769 — 171,769 Future payments-in-kind — 5,745 5,745 — 5,745 5,745 Future interest payments — 34,872 34,872 — 34,872 34,872 Subtotal 171,769 40,617 212,386 171,769 40,617 212,386 8.50%/10.00% Third Lien PIK Toggle Notes, due June 2021: Principal 153,192 — 153,192 153,192 — 153,192 Future payments-in-kind — 11,323 11,323 — 11,323 11,323 Future interest payments — 38,682 38,682 — 38,682 38,682 Subtotal 153,192 50,005 203,197 153,192 50,005 203,197 8.50% Unsecured Senior Notes, due June 2019 189,829 — 189,829 189,829 — 189,829 Debt premium, discount, issuance costs, net of amortization — (3,612 ) (3,612 ) — (3,956 ) (3,956 ) Total long-term debt 889,790 100,549 990,339 889,790 102,262 992,052 Current maturities of long-term debt (2) — 22,858 22,858 — 22,925 22,925 Long term debt, less current maturities $ 889,790 $ 77,691 $ 967,481 $ 889,790 $ 79,337 $ 969,127 (1) Future interest payments and future payments-in-kind are recorded on an undiscounted basis. (2) Future interest payments on the 1.5 Lien Term Loan, Second Lien PIK Toggle Notes and Third Lien PIK Toggle Notes due within twelve months. |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value of Long-Term Debt | The following table presents the fair value of our long-term debt, all of which are classified as Level 2 within the valuation hierarchy (in thousands): Hierarchy March 31, 2018 December 31, 2017 11.00% 1.5 Lien Term Loan, due November 2019 Level 2 $ 75,000 $ 75,000 9.00 % Second Lien Term Loan, due May 2020 Level 2 297,000 288,000 9.00%/10.75% Second Lien PIK Toggle Notes, due May 2020 Level 2 164,898 162,322 8.50%/10.00% Third Lien PIK Toggle Notes, due June 2021 Level 2 127,149 119,490 8.50% Unsecured Senior Notes, due June 2019 Level 2 182,236 178,439 The long-term debt items are reported on the Condensed Consolidated Balance Sheets at their carrying value as described in Note 2. |
Asset Retirement Obligations (T
Asset Retirement Obligations (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Asset Retirement Obligation Disclosure [Abstract] | |
Summary of Changes to Asset Retirement Obligation | A summary of the changes to our ARO is as follows (in thousands): Balance, December 31, 2017 $ 300,446 Liabilities settled (7,022 ) Accretion of discount 4,536 Disposition of properties (297 ) Revisions of estimated liabilities (1) 8,820 Balance, March 31, 2018 306,483 Less current portion 25,748 Long-term $ 280,735 (1) Revisions were primarily related to wells that experienced sustained casing pressure issues. |
Share-Based Compensation and 24
Share-Based Compensation and Cash-Based Incentive Compensation (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Schedule of Outstanding Restricted Stock Units Issued to Eligible Employees | There were no grants or vesting of RSUs during the three months ended March 31, 2018. For the outstanding RSUs issued to the eligible employees as of March 31, 2018, vesting is expected to occur as follows: Restricted Stock Units 2018 3,743,872 2019 2,022,020 Total 5,765,892 |
Schedule of Outstanding Restricted Stock Shares Issued to Non-employee Directors | There were no grants or vesting of Restricted Shares during the three months ended March 31, 2018. For the outstanding Restricted Shares issued to the non-employee directors as of March 31, 2018, vesting is expected to occur as follows: Restricted Shares 2018 106,240 2019 91,164 2020 49,124 Total 246,528 |
Summary of Incentive Compensation Expense under Share-Based Payment Arrangements and Related Tax Benefit | A summary of incentive compensation expense under share-based payment arrangements and the related tax benefit is as follows (in thousands): Three Months Ended March 31, 2018 2017 Share-based compensation expense from: Restricted stock units $ 1,149 $ 1,858 Restricted Shares 70 70 Total $ 1,219 $ 1,928 Share-based compensation tax benefit: Tax benefit computed at the statutory rate $ 256 $ 675 |
Summary of Compensation Expense Related to Share-Based Awards and Cash-Based Awards | A summary of compensation expense related to share-based awards and cash-based awards is as follows (in thousands): Three Months Ended March 31, 2018 2017 Share-based compensation included in: General and administrative expenses $ 1,219 $ 1,928 Cash-based incentive compensation included in: Lease operating expense 860 — General and administrative expenses 2,672 — Total charged to operating income $ 4,751 $ 1,928 |
Earnings_ (Loss) Per Share (Tab
Earnings/ (Loss) Per Share (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Earnings Per Share [Abstract] | |
Schedule of Calculation of Basic and Diluted Earnings (Loss) Per Common Share | The following table presents the calculation of basic and diluted earnings per common share (in thousands, except per share amounts): Three Months Ended March 31, 2018 2017 Net income $ 27,640 $ 24,299 Less portion allocated to nonvested shares 1,145 1,058 Net income allocated to common shares $ 26,495 $ 23,241 Weighted average common shares outstanding 138,845 137,513 Basic and diluted earnings per common share $ 0.19 $ 0.17 |
Supplemental Guarantor Inform26
Supplemental Guarantor Information (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Supplemental Guarantor Information [Abstract] | |
Condensed Consolidating Balance Sheet | The following condensed consolidating financial information presents the financial condition, results of operations and cash flows of the Parent Company and the Guarantor Subsidiaries, together with consolidating adjustments necessary to present the Company’s results on a consolidated basis. As a result of the JV Drilling Program, we recorded proportional consolidation adjustments, which are not considered a guarantor asset under our debt agreements and, accordingly, are reported as non-guarantor adjustments in the following tables. Due to the methodology of recording the ceiling-test write down in prior periods, consolidating adjustments are required to present the consolidated results appropriately. Condensed Consolidating Balance Sheet as of March 31, 2018 Consolidated Parent Guarantor Non-Guarantor W&T Company Subsidiaries Adjustments Eliminations Offshore, Inc. (In thousands) Assets Current assets: Cash and cash equivalents $ 130,711 $ — $ — $ — $ 130,711 Receivables: Oil and natural gas sales 3,842 41,100 — — 44,942 Joint interest 17,835 — — — 17,835 Income taxes 186,134 — — (121,031 ) 65,103 Total receivables 207,811 41,100 — (121,031 ) 127,880 Prepaid expenses and other assets 14,592 3,206 2,399 — 20,197 Total current assets 353,114 44,306 2,399 (121,031 ) 278,788 Oil and natural gas properties and other, net 406,308 128,745 44,947 (6,648 ) 573,352 Restricted deposits for asset retirement obligations 25,622 — — — 25,622 Other assets 577,871 503,839 (46,378 ) (970,918 ) 64,414 Total assets $ 1,362,915 $ 676,890 $ 968 $ (1,098,597 ) $ 942,176 Liabilities and Shareholders’ Equity (Deficit) Current liabilities: Accounts payable $ 70,997 $ 5,477 $ 970 $ — $ 77,444 Undistributed oil and natural gas proceeds 20,598 1,675 — — 22,273 Asset retirement obligations 23,635 2,113 — — 25,748 Long-term debt 22,858 — — — 22,858 Accrued liabilities 23,437 120,887 — (121,031 ) 23,293 Total current liabilities 161,525 130,152 970 (121,031 ) 171,616 Long-term debt: Principal 889,790 — — — 889,790 Carrying value adjustments 77,691 — — — 77,691 Long term debt, less current portion - carrying value 967,481 — — — 967,481 Asset retirement obligations, less current portion 154,861 125,862 12 — 280,735 Other liabilities 617,034 — — (550,041 ) 66,993 Shareholders’ deficit: Common stock 1 — — — 1 Additional paid-in capital 547,039 704,885 — (704,885 ) 547,039 Retained earnings (deficit) (1,060,859 ) (284,009 ) (14 ) 277,360 (1,067,522 ) Treasury stock, at cost (24,167 ) — — — (24,167 ) Total shareholders’ equity (deficit) (537,986 ) 420,876 (14 ) (427,525 ) (544,649 ) Total liabilities and shareholders’ equity (deficit) $ 1,362,915 $ 676,890 $ 968 $ (1,098,597 ) $ 942,176 Condensed Consolidating Balance Sheet as of December 31, 2017 Consolidated Parent Guarantor W&T Company Subsidiaries Eliminations Offshore, Inc. (In thousands) Assets Current assets: Cash and cash equivalents $ 99,058 $ — $ — $ 99,058 Receivables: Oil and natural gas sales 5,665 39,778 — 45,443 Joint interest 19,754 — — 19,754 Income taxes 128,835 — (115,829 ) 13,006 Total receivables 154,254 39,778 (115,829 ) 78,203 Prepaid expenses and other assets 11,154 2,265 — 13,419 Total current assets 264,466 42,043 (115,829 ) 190,680 Oil and natural gas properties and other, net 430,354 152,464 (3,802 ) 579,016 Restricted deposits for asset retirement obligations 25,394 — — 25,394 Income taxes receivable 52,097 — — 52,097 Other assets 505,304 453,306 (898,217 ) 60,393 Total assets $ 1,277,615 $ 647,813 $ (1,017,848 ) $ 907,580 Liabilities and Shareholders’ Deficit Current liabilities: Accounts payable $ 76,703 $ 6,962 $ — $ 83,665 Undistributed oil and natural gas proceeds 18,762 1,367 — 20,129 Asset retirement obligations 22,488 1,125 — 23,613 Long-term debt 22,925 — — 22,925 Accrued liabilities 18,058 115,701 (115,829 ) 17,930 Total current liabilities 158,936 125,155 (115,829 ) 168,262 Long-term debt: Principal 889,790 — — 889,790 Carrying value adjustments 79,337 — — 79,337 Long term debt, less current portion - carrying value 969,127 — — 969,127 Asset retirement obligations, less current portion 152,883 123,950 — 276,833 Other liabilities 566,375 — (499,509 ) 66,866 Shareholders’ deficit: Common stock 1 — — 1 Additional paid-in capital 545,820 704,885 (704,885 ) 545,820 Retained earnings (deficit) (1,091,360 ) (306,177 ) 302,375 (1,095,162 ) Treasury stock, at cost (24,167 ) — — (24,167 ) Total shareholders’ deficit (569,706 ) 398,708 (402,510 ) (573,508 ) Total liabilities and shareholders’ deficit $ 1,277,615 $ 647,813 $ (1,017,848 ) $ 907,580 |
Condensed Consolidating Statement of Operations | Condensed Consolidating Statement of Operations for the Three Months Ended March 31, 2018 Consolidated Parent Guarantor Non-Guarantor W&T Company Subsidiaries Adjustments Eliminations Offshore, Inc. (In thousands) Revenues $ 63,786 $ 70,427 $ — $ — $ 134,213 Operating costs and expenses: Lease operating expenses 19,760 17,083 — — 36,843 Production taxes 455 — — — 455 Gathering and transportation 2,703 2,354 — — 5,057 Depreciation, depletion, amortization and accretion 19,420 15,814 — 2,847 38,081 General and administrative expenses 7,203 7,824 11 — 15,038 Total costs and expenses 49,541 43,075 11 2,847 95,474 Operating income 14,245 27,352 (11 ) (2,847 ) 38,739 Earnings of affiliates 22,167 — — (22,167 ) — Interest expense incurred 11,323 — — — 11,323 Other (income) expense, net (336 ) — 3 — (333 ) Income before income tax expense (benefit) 25,425 27,352 (14 ) (25,014 ) 27,749 Income tax expense (benefit) (5,076 ) 5,185 — — 109 Net income $ 30,501 $ 22,167 $ (14 ) $ (25,014 ) $ 27,640 Condensed Consolidating Statement of Operations for the Three Months Ended March 31, 2017 Consolidated Parent Guarantor W&T Company Subsidiaries Eliminations Offshore, Inc. (In thousands) Revenues $ 53,707 $ 70,686 $ — $ 124,393 Operating costs and expenses: Lease operating expenses 23,702 16,462 — 40,164 Production taxes 515 — — 515 Gathering and transportation 2,566 3,643 — 6,209 Depreciation, depletion, amortization and accretion 19,154 20,105 731 39,990 General and administrative expenses 5,776 7,498 — 13,274 Derivative gain (3,955 ) — — (3,955 ) Total costs and expenses 47,758 47,708 731 96,197 Operating income 5,949 22,978 (731 ) 28,196 Earnings of affiliates 17,527 — (17,527 ) — Interest expense incurred 11,294 — — 11,294 Other expense, net 191 — — 191 Income before income tax expense (benefit) 11,991 22,978 (18,258 ) 16,711 Income tax expense (benefit) (13,039 ) 5,451 — (7,588 ) Net income $ 25,030 $ 17,527 $ (18,258 ) $ 24,299 |
Condensed Consolidating Statement of Cash Flows | Condensed Consolidating Statement of Cash Flows for the Three Months Ended March 31, 2018 Consolidated W&T Parent Guarantor Non-Guarantor Offshore, Company Subsidiaries Adjustments Eliminations Inc. (In thousands) Operating activities: Net income $ 30,501 $ 22,167 $ (14 ) $ (25,014 ) $ 27,640 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation, depletion, amortization and accretion 19,420 15,814 — 2,847 38,081 Amortization of debt items 466 — — — 466 Share-based compensation 1,219 — — — 1,219 Deferred income taxes 109 — — — 109 Earnings of affiliates (22,167 ) — — 22,167 — Changes in operating assets and liabilities: — Oil and natural gas receivables 1,823 (1,322 ) — — 501 Joint interest receivables 1,919 — — — 1,919 Income taxes (5,186 ) 5,186 — — — Prepaid expenses and other assets 25,275 (31,783 ) 1,991 (1,874 ) (6,391 ) Asset retirement obligation settlements (5,633 ) (1,389 ) — — (7,022 ) Cash advances from JV partners 13,129 6,018 — — 19,147 Accounts payable, accrued liabilities and other 2,403 (4,965 ) - 1,874 (688 ) Net cash provided by operating activities 63,278 9,726 1,977 — 74,981 Investing activities: Investment in oil and natural gas properties and equipment (10,674 ) (7,496 ) (2,947 ) — (21,117 ) Changes in operating assets and liabilities associated with investing activities (15,894 ) (2,230 ) 970 — (17,154 ) Deposit for acquisition (3,000 ) — — — (3,000 ) Net cash used in investing activities (29,568 ) (9,726 ) (1,977 ) — (41,271 ) Financing activities: Payment of interest on 1.5 Lien Term Loan (2,057 ) — — — (2,057 ) Net cash used in financing activities (2,057 ) — — — (2,057 ) Increase in cash and cash equivalents 31,653 — — — 31,653 Cash and cash equivalents, beginning of period 99,058 — — — 99,058 Cash and cash equivalents, end of period $ 130,711 $ — $ — $ — $ 130,711 Condensed Consolidating Statement of Cash Flows for the Three Months Ended March 31, 2017 Consolidated W&T Parent Guarantor Offshore, Company Subsidiaries Eliminations Inc. (In thousands) Operating activities: Net income $ 25,030 $ 17,527 $ (18,258 ) $ 24,299 Adjustments to reconcile net loss to net cash provided by operating activities: Depreciation, depletion, amortization and accretion 19,154 20,105 731 39,990 Amortization of debt items 412 — — 412 Share-based compensation 1,928 — — 1,928 Derivative gain (3,955 ) — — (3,955 ) Cash receipts on derivative settlements 713 — — 713 Deferred income taxes 105 — — 105 Earnings of affiliates (17,527 ) — 17,527 — Changes in operating assets and liabilities: Oil and natural gas receivables (2,004 ) 122 — (1,882 ) Joint interest receivables 5,042 — — 5,042 Insurance reimbursements 30,100 — — 30,100 Income taxes (5,451 ) 5,451 — — Prepaid expenses and other assets (6,927 ) (42,395 ) 41,350 (7,972 ) Asset retirement obligations (12,940 ) (1,559 ) — (14,499 ) Cash advances from JV partners (2,531 ) — — (2,531 ) Accounts payable, accrued liabilities and other 49,295 1,488 (41,350 ) 9,433 Net cash provided by operating activities 80,444 739 — 81,183 Investing activities: Investment in oil and natural gas properties and equipment (23,593 ) 255 — (23,338 ) Changes in operating assets and liabilities associated with investing activities 2,162 (994 ) — 1,168 Purchases of furniture, fixtures and other (853 ) — — (853 ) Net cash used in investing activities (22,284 ) (739 ) — (23,023 ) Financing activities: Payment of interest on 1.5 Lien Term Loan (2,056 ) — — (2,056 ) Other (245 ) — — (245 ) Net cash provided by financing activities (2,301 ) — — (2,301 ) Increase in cash, cash equivalents and restricted cash 55,859 — — 55,859 Cash and cash equivalents, beginning of period 70,236 — — 70,236 Cash and cash equivalents, end of period $ 126,095 $ — $ — $ 126,095 |
Basis of Presentation - Additio
Basis of Presentation - Additional Information (Details) | Apr. 27, 2018USD ($) | Mar. 12, 2018DrillingProject | May 03, 2018USD ($) | Mar. 31, 2018USD ($)Loan | Dec. 31, 2017USD ($) | Sep. 07, 2016 |
Basis Of Presentation [Line Items] | ||||||
Number of loans for which maturities will be accelerated | Loan | 2 | |||||
Oil and natural gas properties and equipment - full cost method, amount excluded from amortization | $ 0 | $ 0 | ||||
JV Drilling Program | Subsequent Event | ||||||
Basis Of Presentation [Line Items] | ||||||
Commitment amount by investors | $ 297,600,000 | |||||
Monza Energy LLC | JV Drilling Program | ||||||
Basis Of Presentation [Line Items] | ||||||
Number of drilling projects | DrillingProject | 14 | |||||
Joint maturity period | 3 years | |||||
Percentage of revenue from joint venture | 30.00% | |||||
Percentage of estimated well cost | 20.00% | |||||
Joint venture ownership percentage contributed to related party | 88.94% | |||||
Joint venture ownership percentage | 11.06% | |||||
Monza Energy LLC | JV Drilling Program | Subsequent Event | ||||||
Basis Of Presentation [Line Items] | ||||||
Commitment amount by investors | $ 297,600,000 | |||||
Revolving Bank Credit Facility Due November 2018 | ||||||
Basis Of Presentation [Line Items] | ||||||
Credit agreement expiration date | Nov. 8, 2018 | |||||
Letters of credit outstanding | $ 300,000 | |||||
Revolving bank credit facility borrowings outstanding | $ 0 | $ 0 | ||||
8.50% Unsecured Senior Notes, Due June 2019 | ||||||
Basis Of Presentation [Line Items] | ||||||
Debt instrument maturity date | Jun. 15, 2019 | Jun. 15, 2019 | ||||
Debt instrument interest rate | 8.50% | 8.50% | ||||
11.00% 1.5 Lien Term Loan, Due November 2019 | ||||||
Basis Of Presentation [Line Items] | ||||||
Debt instrument maturity date | Nov. 15, 2019 | Nov. 15, 2019 | ||||
Debt instrument interest rate | 11.00% | 11.00% | ||||
Debt instrument maturity date | Feb. 28, 2019 | |||||
8.50%/10.00% Third Lien PIK Toggle Notes, Due June 2021 | ||||||
Basis Of Presentation [Line Items] | ||||||
Debt instrument maturity date | Jun. 15, 2021 | Jun. 15, 2021 | ||||
Debt instrument interest rate | 8.50% | 8.50% | 8.50% | |||
Debt instrument paid in kind interest rate | 10.00% | 10.00% | ||||
Debt instrument maturity date | Feb. 28, 2019 |
Basis of Presentation - Schedul
Basis of Presentation - Schedule of Amounts Recorded in Prepaid Expenses and Other Assets (Details) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 |
Prepaid Expense And Other Assets Current [Abstract] | |||
Prepaid/accrued insurance | $ 2,401 | $ 1,983 | |
Surety bond unamortized premiums | 2,676 | 3,387 | |
Prepaid deposits related to royalties | 6,456 | 7,451 | |
Deposit related to an acquisition | 3,000 | ||
Proportional consolidation of Monza prepaids (Note 4) | 2,399 | ||
Other | 1,886 | 1,977 | |
Prepaid expenses and other assets | $ 20,197 | $ 13,419 | $ 20,197 |
Basis of Presentation - Sched29
Basis of Presentation - Schedule of Oil and Natural Gas Properties and Other, Net at Cost (Details) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 |
Property Plant And Equipment Net [Abstract] | ||
Oil and natural gas properties and equipment | $ 8,129,924 | $ 8,102,044 |
Furniture, fixtures and other | 21,831 | 21,831 |
Total property and equipment | 8,151,755 | 8,123,875 |
Less accumulated depreciation, depletion and amortization | 7,578,403 | 7,544,859 |
Oil and natural gas properties and other, net | $ 573,352 | $ 579,016 |
Basis of Presentation - Sched30
Basis of Presentation - Schedule of Accrued Liabilities (Details) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 |
Payables And Accruals [Abstract] | ||
Accrued interest | $ 14,889 | $ 4,200 |
Accrued salaries/payroll taxes/benefits | 2,577 | 2,454 |
Incentive compensation plans | 1,993 | 7,366 |
Litigation accruals | 3,480 | 3,480 |
Other | 354 | 430 |
Total accrued liabilities | $ 23,293 | $ 17,930 |
Basis of Presentation - Sched31
Basis of Presentation - Schedule of Other Assets (Long-term) (Details) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 |
Other Assets [Abstract] | ||
Escrow deposit - Apache lawsuit | $ 49,500 | $ 49,500 |
Appeal bond deposits | 6,925 | 6,925 |
Investment in White Cap, LLC | 2,593 | 2,511 |
Unamortized brokerage fee for Monza | 1,724 | |
Proportional consolidation of Monza other assets (Note 4) | 2,387 | |
Other | 1,285 | 1,457 |
Total other assets | $ 64,414 | $ 60,393 |
Basis of Presentation - Sched32
Basis of Presentation - Schedule of Other Liabilities (Long-term) (Details) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 |
Other Liabilities Disclosure [Abstract] | ||
Apache lawsuit | $ 49,500 | $ 49,500 |
Uncertain tax positions including interest/penalties | 11,124 | 11,015 |
Other | 6,369 | 6,351 |
Total other liabilities (long-term) | $ 66,993 | $ 66,866 |
Long-Term Debt - Components of
Long-Term Debt - Components of Long-Term Debt (Details) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 |
Debt Instrument [Line Items] | ||
Principal | $ 889,790 | $ 889,790 |
Adjustments to carrying value, Debt premium, discount, issuance costs, net of amortization | (3,612) | (3,956) |
Adjustments to carrying value, Total | 100,549 | 102,262 |
Adjustments to carrying value, Current maturities | 22,858 | 22,925 |
Adjustments to carrying value, less current maturities | 77,691 | 79,337 |
Debt premium, discount, issuance costs, net of amortization | (3,612) | (3,956) |
Total long-term debt | 990,339 | 992,052 |
Long-term debt | 22,858 | 22,925 |
Long term debt, less current maturities | 967,481 | 969,127 |
11.00% 1.5 Lien Term Loan, Due November 2019 | ||
Debt Instrument [Line Items] | ||
Principal | 75,000 | 75,000 |
Adjustments to carrying value, Future interest payments | 13,539 | 15,596 |
Adjustments to carrying value, Subtotal | 13,539 | 15,596 |
Carrying Value | 88,539 | 90,596 |
9.00 % Second Lien Term Loan, Due May 2020 | ||
Debt Instrument [Line Items] | ||
Principal | 300,000 | 300,000 |
Carrying Value | 300,000 | 300,000 |
8.50% Unsecured Senior Notes, Due June 2019 | ||
Debt Instrument [Line Items] | ||
Principal | 189,829 | 189,829 |
Carrying Value | 189,829 | 189,829 |
9.00%/10.75% Second Lien PIK Toggle Notes, Due May 2020 | ||
Debt Instrument [Line Items] | ||
Principal | 171,769 | 171,769 |
Adjustments to carrying value, Future payments-in-kind | 5,745 | 5,745 |
Adjustments to carrying value, Future interest payments | 34,872 | 34,872 |
Adjustments to carrying value, Subtotal | 40,617 | 40,617 |
Carrying Value | 212,386 | 212,386 |
8.50%/10.00% Third Lien PIK Toggle Notes, Due June 2021 | ||
Debt Instrument [Line Items] | ||
Principal | 153,192 | 153,192 |
Adjustments to carrying value, Future payments-in-kind | 11,323 | 11,323 |
Adjustments to carrying value, Future interest payments | 38,682 | 38,682 |
Adjustments to carrying value, Subtotal | 50,005 | 50,005 |
Carrying Value | $ 203,197 | $ 203,197 |
Long-Term Debt - Components o34
Long-Term Debt - Components of Long-Term Debt (Parenthetical) (Details) | 3 Months Ended | 12 Months Ended | ||
Mar. 31, 2018 | Dec. 31, 2017 | Sep. 07, 2016 | May 31, 2015 | |
11.00% 1.5 Lien Term Loan, Due November 2019 | ||||
Debt Instrument [Line Items] | ||||
Debt instrument interest rate | 11.00% | 11.00% | ||
Debt instrument maturity date | Nov. 15, 2019 | Nov. 15, 2019 | ||
9.00 % Second Lien Term Loan, Due May 2020 | ||||
Debt Instrument [Line Items] | ||||
Debt instrument interest rate | 9.00% | 9.00% | 9.00% | |
Debt instrument maturity date | May 15, 2020 | May 15, 2020 | ||
9.00%/10.75% Second Lien PIK Toggle Notes, Due May 2020 | ||||
Debt Instrument [Line Items] | ||||
Debt instrument interest rate | 9.00% | 9.00% | 9.00% | |
Debt instrument maturity date | May 15, 2020 | May 15, 2020 | ||
Debt instrument paid in kind interest rate | 10.75% | 10.75% | ||
8.50%/10.00% Third Lien PIK Toggle Notes, Due June 2021 | ||||
Debt Instrument [Line Items] | ||||
Debt instrument interest rate | 8.50% | 8.50% | 8.50% | |
Debt instrument maturity date | Jun. 15, 2021 | Jun. 15, 2021 | ||
Debt instrument paid in kind interest rate | 10.00% | 10.00% | ||
8.50% Unsecured Senior Notes, Due June 2019 | ||||
Debt Instrument [Line Items] | ||||
Debt instrument interest rate | 8.50% | 8.50% | ||
Debt instrument maturity date | Jun. 15, 2019 | Jun. 15, 2019 |
Long-Term Debt - Additional Inf
Long-Term Debt - Additional Information (Details) - USD ($) | Sep. 07, 2016 | May 31, 2015 | Mar. 31, 2018 | Dec. 31, 2017 |
9.00%/10.75% Second Lien PIK Toggle Notes, Due May 2020 | ||||
Debt Instrument [Line Items] | ||||
Debt instrument interest rate | 9.00% | 9.00% | 9.00% | |
Debt instrument maturity date | May 15, 2020 | May 15, 2020 | ||
Debt instrument paid in kind interest rate | 10.75% | 10.75% | ||
Debt instrument payment terms | Interest is payable on May 15 and November 15 of each year. The Second Lien PIK Toggle Notes contain provisions whereby certain semi-annual interest is added to the principal amount through payment-in-kind instead of being paid in cash in the then current semi-annual period. For the interest period from November 15, 2017 up to and including March 6, 2018, we elected the option to pay that portion of interest in kind at the rate of 10.75% per annum. | |||
Debt instrument stated interest rate percentage for payment-in-kind | 10.75% | |||
Cash interest payable stub period | Mar. 7, 2018 | |||
Revolving Bank Credit Facility Due November 2018 | ||||
Debt Instrument [Line Items] | ||||
Revolving bank credit facility borrowing base | $ 150,000,000 | |||
Revolving bank credit facility maximum lender commitment | $ 150,000,000 | |||
First lien leverage ratio | 200.00% | |||
Outstanding balances on the revolving bank credit facility (including letters of credit) | $ 5,000,000 | |||
Unused portion of the borrowing base commitment fee | 0.50% | |||
Credit agreement expiration date | Nov. 8, 2018 | |||
Revolving bank credit facility borrowings outstanding | $ 0 | $ 0 | ||
Letters of credit outstanding | 300,000 | |||
Remaining availability | 149,700,000 | |||
Revolving Bank Credit Facility Due November 2018 | Scenario Covenants | ||||
Debt Instrument [Line Items] | ||||
Maximum unrestricted cash balance if revolver balance is above $5 million | $ 35,000,000 | |||
Revolving Bank Credit Facility Due November 2018 | Minimum | ||||
Debt Instrument [Line Items] | ||||
Current ratio | 100.00% | |||
Revolving Bank Credit Facility Due November 2018 | Minimum | Eurodollar | ||||
Debt Instrument [Line Items] | ||||
Debt instrument, basis spread on variable rate | 3.00% | |||
Revolving Bank Credit Facility Due November 2018 | Maximum | Eurodollar | ||||
Debt Instrument [Line Items] | ||||
Debt instrument, basis spread on variable rate | 4.00% | |||
11.00% 1.5 Lien Term Loan, Due November 2019 | ||||
Debt Instrument [Line Items] | ||||
Debt instrument interest rate | 11.00% | |||
Debt instrument maturity date | Nov. 15, 2019 | |||
Debt instrument payment terms | Interest accrues at 11.00% per annum and is payable quarterly in cash. | |||
Debt instrument frequency of interest payment in cash | quarterly | |||
Debt instrument, maturity date, description | 1.5 Lien Term Loan with a maturity date of November 15, 2019. The maturity date will accelerate to February 28, 2019 if the remaining Unsecured Senior Notes have not been extended, renewed, refunded, defeased, discharged, replaced or refinanced by February 28, 2019. | |||
11.00% 1.5 Lien Term Loan, Due November 2019 | Minimum | ||||
Debt Instrument [Line Items] | ||||
Unsecured senior notes repurchase price limit percentage | 65.00% | |||
Unsecured senior notes repurchase basket limit | $ 35,000,000 | |||
9.00 % Second Lien Term Loan, Due May 2020 | ||||
Debt Instrument [Line Items] | ||||
Debt instrument interest rate | 9.00% | 9.00% | 9.00% | |
Debt instrument maturity date | May 15, 2020 | May 15, 2020 | ||
Debt instrument payment terms | Interest on the Second Lien Term Loan is payable in arrears semi-annually on May 15 and November 15. | |||
Debt instrument discount rate | 1.00% | |||
Annual effective interest rate | 9.60% | |||
8.50%/10.00% Third Lien PIK Toggle Notes, Due June 2021 | ||||
Debt Instrument [Line Items] | ||||
Debt instrument interest rate | 8.50% | 8.50% | 8.50% | |
Debt instrument maturity date | Jun. 15, 2021 | Jun. 15, 2021 | ||
Debt instrument paid in kind interest rate | 10.00% | 10.00% | ||
Debt instrument payment terms | The maturity date will accelerate to February 28, 2019 if the remaining Unsecured Senior Notes have not been extended, renewed, refunded, defeased, discharged, replaced or refinanced by February 28, 2019. Interest is payable on June 15 and December 15 of each year. The Third Lien PIK Toggle Notes contain interest provisions whereby certain semi-annual interest is added to the principal amount through payment-in-kind instead of being paid in cash in the then current semi-annual period. For interest periods up to and including September 6, 2018, if we so elect, we have the option to pay all or a portion of interest in kind at a rate of 10.00% per annum. | |||
Debt instrument stated interest rate percentage for payment-in-kind | 10.00% | |||
Cash interest payable stub period | Sep. 7, 2018 | |||
8.50% Unsecured Senior Notes, Due June 2019 | ||||
Debt Instrument [Line Items] | ||||
Debt instrument interest rate | 8.50% | 8.50% | ||
Debt instrument maturity date | Jun. 15, 2019 | Jun. 15, 2019 | ||
Debt instrument payment terms | semi-annually in arrears on June 15 and December 15 | |||
Annual effective interest rate | 8.40% | |||
Exchange Transaction | 9.00%/10.75% Second Lien PIK Toggle Notes, Due May 2020 | ||||
Debt Instrument [Line Items] | ||||
Debt instrument maturity date | May 15, 2020 | |||
Exchange Transaction | 9.00%/10.75% Second Lien PIK Toggle Notes, Due May 2020 | Minimum | ||||
Debt Instrument [Line Items] | ||||
Debt instrument interest rate | 9.00% | |||
Exchange Transaction | 9.00%/10.75% Second Lien PIK Toggle Notes, Due May 2020 | Maximum | ||||
Debt Instrument [Line Items] | ||||
Debt instrument paid in kind interest rate | 10.75% | |||
Exchange Transaction | 1.5 Lien Term Loan | ||||
Debt Instrument [Line Items] | ||||
Interest expense recorded for new debt | $ 0 |
Fair Value Measurements - Sched
Fair Value Measurements - Schedule of Fair Value of Long-Term Debt (Details) - Fair Value, Inputs, Level 2 - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 |
11.00% 1.5 Lien Term Loan, Due November 2019 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Long-term debt, term loan fair value | $ 75,000 | $ 75,000 |
9.00 % Second Lien Term Loan, Due May 2020 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Long-term debt, term loan fair value | 297,000 | 288,000 |
9.00%/10.75% Second Lien PIK Toggle Notes, Due May 2020 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Long-term debt, notes fair value | 164,898 | 162,322 |
8.50%/10.00% Third Lien PIK Toggle Notes, Due June 2021 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Long-term debt, notes fair value | 127,149 | 119,490 |
8.50% Unsecured Senior Notes, Due June 2019 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Long-term debt, notes fair value | $ 182,236 | $ 178,439 |
Fair Value Measurements - Sch37
Fair Value Measurements - Schedule of Fair Value of Long-Term Debt (Parenthetical) (Details) | 3 Months Ended | 12 Months Ended | ||
Mar. 31, 2018 | Dec. 31, 2017 | Sep. 07, 2016 | May 31, 2015 | |
11.00% 1.5 Lien Term Loan, Due November 2019 | ||||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||||
Debt instrument interest rate | 11.00% | 11.00% | ||
Debt instrument maturity date | Nov. 15, 2019 | Nov. 15, 2019 | ||
9.00 % Second Lien Term Loan, Due May 2020 | ||||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||||
Debt instrument interest rate | 9.00% | 9.00% | 9.00% | |
Debt instrument maturity date | May 15, 2020 | May 15, 2020 | ||
9.00%/10.75% Second Lien PIK Toggle Notes, Due May 2020 | ||||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||||
Debt instrument interest rate | 9.00% | 9.00% | 9.00% | |
Debt instrument maturity date | May 15, 2020 | May 15, 2020 | ||
Debt instrument paid in kind interest rate | 10.75% | 10.75% | ||
8.50%/10.00% Third Lien PIK Toggle Notes, Due June 2021 | ||||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||||
Debt instrument interest rate | 8.50% | 8.50% | 8.50% | |
Debt instrument maturity date | Jun. 15, 2021 | Jun. 15, 2021 | ||
Debt instrument paid in kind interest rate | 10.00% | 10.00% | ||
8.50% Unsecured Senior Notes, Due June 2019 | ||||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||||
Debt instrument interest rate | 8.50% | 8.50% | ||
Debt instrument maturity date | Jun. 15, 2019 | Jun. 15, 2019 |
JV Drilling Program - Additiona
JV Drilling Program - Additional Information (Details) | Apr. 27, 2018USD ($) | Mar. 12, 2018DrillingProject | May 03, 2018USD ($) | Mar. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Sep. 30, 2017USD ($) |
Oil And Gas In Process Activities [Line Items] | ||||||
Prepaid assets | $ 20,197,000 | $ 13,419,000 | $ 20,197,000 | |||
Oil and natural gas properties | 573,352,000 | 579,016,000 | ||||
Other assets | 64,414,000 | 60,393,000 | ||||
Accounts payable | 77,444,000 | $ 83,665,000 | ||||
Monza Energy LLC | ||||||
Oil And Gas In Process Activities [Line Items] | ||||||
Prepaid assets | 2,400,000 | |||||
Oil and natural gas properties | 44,900,000 | |||||
Other assets | 2,400,000 | |||||
Accounts payable | 1,000,000 | |||||
Maximum exposure amount by related party | 48,700,000 | |||||
Maximum exposure amount, cash contribution | 6,700,000 | |||||
Maximum exposure amount, fair value for conveyance of working interest | 42,000,000 | |||||
JV Drilling Program | ||||||
Oil And Gas In Process Activities [Line Items] | ||||||
Capital expenditures reimbursement, net | $ 20,000,000 | |||||
JV Drilling Program | Mr. Tracy W. Krohn | ||||||
Oil And Gas In Process Activities [Line Items] | ||||||
Minority interest ownership percentage by joint venture | 4.50% | |||||
JV Drilling Program | Subsequent Event | ||||||
Oil And Gas In Process Activities [Line Items] | ||||||
Commitment amount by investors | $ 297,600,000 | |||||
JV Drilling Program | Monza Energy LLC | ||||||
Oil And Gas In Process Activities [Line Items] | ||||||
Number of drilling projects | DrillingProject | 14 | |||||
Joint maturity period | 3 years | |||||
Joint venture ownership percentage contributed to related party | 88.94% | |||||
Joint venture ownership percentage | 11.06% | |||||
Projected cost to fully develop projects excluding contingencies | $ 298,600,000 | |||||
Projected cost to fully develop projects with contingent costs | 373,000,000 | |||||
Indirect cash commitment through Monza | 37,500,000 | |||||
Percentage of revenue from joint venture | 30.00% | |||||
Percentage of estimated well cost | 20.00% | |||||
JV Drilling Program | Monza Energy LLC | Mr. Tracy W. Krohn | ||||||
Oil And Gas In Process Activities [Line Items] | ||||||
Capital commitment | 13,400,000 | |||||
Maximum capital commitment amount subject to joining of additional investors | $ 16,800,000 | |||||
JV Drilling Program | Monza Energy LLC | Subsequent Event | ||||||
Oil And Gas In Process Activities [Line Items] | ||||||
Commitment amount by investors | $ 297,600,000 |
Asset Retirement Obligations -
Asset Retirement Obligations - Summary of Changes to Asset Retirement Obligation (Details) - USD ($) $ in Thousands | 3 Months Ended | |||
Mar. 31, 2018 | Mar. 31, 2017 | Dec. 31, 2017 | ||
Asset Retirement Obligation, Roll Forward Analysis [Roll Forward] | ||||
Asset retirement obligations, beginning of period | $ 300,446 | |||
Asset retirement obligation settlements | (7,022) | $ (14,499) | ||
Accretion of discount | 4,536 | |||
Disposition of properties | (297) | |||
Revisions of estimated liabilities | [1] | 8,820 | ||
Asset retirement obligations, end of period | 306,483 | |||
Less current portion | 25,748 | $ 23,613 | ||
Long-term | $ 280,735 | $ 276,833 | ||
[1] | Revisions were primarily related to wells that experienced sustained casing pressure issues. |
Share-Based Compensation and 40
Share-Based Compensation and Cash-Based Incentive Compensation - Additional Information (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Common stock available for award under plans | 13,363,792 | |
Recognized incentive compensation expense | $ 1,219,000 | $ 1,928,000 |
Restricted Stock Units (RSUs) | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Shares granted | 0 | |
Shares vested | 0 | |
Unrecognized share-based compensation expense | $ 5,000,000 | |
Recognition period for unrecognized compensation expense | 2019-11 | |
Recognized incentive compensation expense | $ 1,149,000 | 1,858,000 |
Restricted Shares | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Shares granted | 0 | |
Shares vested | 0 | |
Unrecognized share-based compensation expense | $ 300,000 | |
Recognition period for unrecognized compensation expense | 2020-04 | |
Recognized incentive compensation expense | $ 70,000 | 70,000 |
2017 Cash-based Awards | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Cash based award expected payment period | 2018-03 | |
2017 Cash-based Awards | Minimum | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Adjusted EBITDA less interest expense | $ 200,000,000 | |
2016 Cash-based Awards | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Recognized incentive compensation expense | $ 0 | $ 0 |
Cash based compensation payment period after achievement of financial condition | 30 days | |
2016 Cash-based Awards | Minimum | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Adjusted EBITDA less interest expense | $ 300,000,000 | |
Amended and Restated Incentive Compensation Plan | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Amendment increased the number of shares available in the Plan | 7,700,000 | |
Directors Compensation Plan | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Common stock available for award under plans | 170,524 |
Share-Based Compensation and 41
Share-Based Compensation and Cash-Based Incentive Compensation - Schedule of Outstanding Restricted Stock Units Issued to Eligible Employees (Details) - Restricted Stock Units (RSUs) | Mar. 31, 2018shares |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Awards expected to vest by period | 5,765,892 |
2,018 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Awards expected to vest by period | 3,743,872 |
2,019 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Awards expected to vest by period | 2,022,020 |
Share-Based Compensation and 42
Share-Based Compensation and Cash-Based Incentive Compensation - Outstanding Restricted Shares Issued to Non-employee Directors (Details) - Restricted Shares | Mar. 31, 2018shares |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Awards expected to vest by period | 246,528 |
2,018 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Awards expected to vest by period | 106,240 |
2,019 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Awards expected to vest by period | 91,164 |
2,020 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Awards expected to vest by period | 49,124 |
Share-Based Compensation and 43
Share-Based Compensation and Cash-Based Incentive Compensation - Summary of Incentive Compensation Expense under Share-Based Payment Arrangements and Related Tax Benefit (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Share-based compensation | $ 1,219 | $ 1,928 |
Tax benefit computed at the statutory rate | 256 | 675 |
Restricted Stock Units (RSUs) | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Share-based compensation | 1,149 | 1,858 |
Restricted Shares | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Share-based compensation | $ 70 | $ 70 |
Share-Based Awards and Cash-Bas
Share-Based Awards and Cash-Based Awards - Summary of Compensation Expense Related to Share-Based Awards and Cash-Based Awards (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||
Share-based compensation charged to operating income | $ 1,219 | $ 1,928 |
Total charged to operating income | 4,751 | 1,928 |
General And Administrative Expense | ||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||
Share-based compensation charged to operating income | 1,219 | $ 1,928 |
Cash-based incentive compensation charged to operating income | 2,672 | |
Lease Operating Expense | ||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||
Cash-based incentive compensation charged to operating income | $ 860 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) | 3 Months Ended | |||
Mar. 31, 2018 | Mar. 31, 2017 | Mar. 07, 2018 | Dec. 31, 2017 | |
Income Tax Expense (Benefit), Continuing Operations [Abstract] | ||||
Income tax expense (benefit) | $ 109,000 | $ (7,588,000) | ||
Income tax expense (benefit) excluding interest on uncertain positions | 0 | 0 | ||
Current tax expense | 0 | 0 | ||
Income tax refund received | 0 | 0 | ||
Cash paid for income taxes | 0 | $ 0 | ||
Current income taxes receivable | 65,103,000 | $ 13,000,000 | $ 13,006,000 | |
Non-current income taxes receivable | $ 52,100,000 | 52,097,000 | ||
Valuation allowance | $ 165,700,000 | $ 171,500,000 | ||
Minimum | ||||
Income Tax Expense (Benefit), Continuing Operations [Abstract] | ||||
Tax years under examination | 2,013 | |||
Maximum | ||||
Income Tax Expense (Benefit), Continuing Operations [Abstract] | ||||
Tax years under examination | 2,017 |
Earnings_ (Loss) Per Share - Sc
Earnings/ (Loss) Per Share - Schedule of Calculation of Basic and Diluted Earnings (Loss) Per Common Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Earnings Per Share, Basic and Diluted [Abstract] | ||
Net income | $ 27,640 | $ 24,299 |
Less portion allocated to nonvested shares | 1,145 | 1,058 |
Net income allocated to common shares | $ 26,495 | $ 23,241 |
Weighted average common shares outstanding | 138,845 | 137,513 |
Basic and diluted earnings per common share | $ 0.19 | $ 0.17 |
Contingencies - Additional Info
Contingencies - Additional Information (Details) $ in Thousands | Jan. 27, 2017USD ($) | Mar. 31, 2018USD ($) | Mar. 31, 2017USD ($)claim | Dec. 31, 2017USD ($) | May 31, 2017USD ($) | Dec. 15, 2014DeepwaterWell | Dec. 31, 2010USD ($) |
Loss Contingencies [Line Items] | |||||||
Number of deepwater wells abandoned | DeepwaterWell | 3 | ||||||
Deposit Into registry of court | $ 49,500 | $ 49,500 | |||||
Loss contingency accrued amount | $ 49,500 | 49,500 | |||||
Additional royalty payment | $ 4,700 | ||||||
Payments for royalty | $ 4,700 | ||||||
Bond requied to post in order to appeal | 7,200 | ||||||
Cash collacteral required to appeal | $ 6,900 | ||||||
Royalty payment processing revised period | 84 months | ||||||
BSEE | |||||||
Loss Contingencies [Line Items] | |||||||
Number of notices | claim | 5 | ||||||
Proposed civil penalties related to various incidents of noncompliance, total | $ 7,800 | ||||||
Payments for civil penalty | 3,300 | ||||||
Maximum | |||||||
Loss Contingencies [Line Items] | |||||||
Additional royalty payment | $ 100 | $ 700 | |||||
Apache Corporation | Judicial Ruling | |||||||
Loss Contingencies [Line Items] | |||||||
Amount owed to Apache under judicial decision | $ 43,200 | ||||||
Prejudgment interest, attorney fees and judgment costs | $ 6,300 | ||||||
Apache Corporation | Judicial Ruling | Other Noncurrent Assets | |||||||
Loss Contingencies [Line Items] | |||||||
Deposit Into registry of court | 49,500 | 49,500 | |||||
Apache Corporation | Judicial Ruling | Other Noncurrent Liabilities | |||||||
Loss Contingencies [Line Items] | |||||||
Loss contingency accrued amount | $ 49,500 | $ 49,500 |
Subsequent Events - Additional
Subsequent Events - Additional Information (Details) - Subsequent Event $ in Millions | Apr. 05, 2018USD ($) | May 03, 2018USD ($)Investor |
Heidelberg Field Acquisition | ||
Subsequent Event [Line Items] | ||
Percentage of non-operated working interest acquired | 9.375% | |
Gross purchase price | $ 31.1 | |
Letters of credit outstanding | 9.4 | |
Amount of cash deposit required for issuance of letters of credit | 4.7 | |
Letter of Credit | Heidelberg Field Acquisition | ||
Subsequent Event [Line Items] | ||
Revolving bank credit facility maximum lender commitment | 5 | |
Minimum | Heidelberg Field Acquisition | ||
Subsequent Event [Line Items] | ||
Anti-hoarding provision, required cash | $ 35 | |
JV Drilling Program | ||
Subsequent Event [Line Items] | ||
Number of additional third party investors committed to program | Investor | 5 | |
Commitment amount by investors | $ 297.6 |
Supplemental Guarantor Inform49
Supplemental Guarantor Information - Additional Information (Details) | Mar. 31, 2018 |
Debt Disclosure [Abstract] | |
Percentage of subsidiaries owned | 100.00% |
Supplemental Guarantor Inform50
Supplemental Guarantor Information - Condensed Consolidating Balance Sheet (Details) - USD ($) $ in Thousands | Mar. 31, 2018 | Mar. 07, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 |
Current assets: | ||||||
Cash and cash equivalents | $ 130,711 | $ 99,058 | $ 126,095 | $ 70,236 | ||
Receivables: | ||||||
Oil and natural gas sales | 44,942 | 45,443 | ||||
Joint interest | 17,835 | 19,754 | ||||
Income taxes | 65,103 | $ 13,000 | 13,006 | |||
Total receivables | 127,880 | 78,203 | ||||
Prepaid expenses and other assets | 20,197 | 13,419 | $ 20,197 | |||
Total current assets | 278,788 | 190,680 | ||||
Oil and natural gas properties and other, net | 573,352 | 579,016 | ||||
Restricted deposits for asset retirement obligations | 25,622 | 25,394 | ||||
Income taxes receivable | $ 52,100 | 52,097 | ||||
Other assets | 64,414 | 60,393 | ||||
Total assets | 942,176 | 907,580 | ||||
Current liabilities: | ||||||
Accounts payable | 77,444 | 83,665 | ||||
Undistributed oil and natural gas proceeds | 22,273 | 20,129 | ||||
Asset retirement obligations | 25,748 | 23,613 | ||||
Long-term debt | 22,858 | 22,925 | ||||
Accrued liabilities | 23,293 | 17,930 | ||||
Total current liabilities | 171,616 | 168,262 | ||||
Long-term debt: | ||||||
Principal | 889,790 | 889,790 | ||||
Carrying value adjustments | 77,691 | 79,337 | ||||
Long term debt, less current portion - carrying value | 967,481 | 969,127 | ||||
Asset retirement obligations, less current portion | 280,735 | 276,833 | ||||
Other liabilities | 66,993 | 66,866 | ||||
Shareholders’ deficit: | ||||||
Common stock | 1 | 1 | ||||
Additional paid-in capital | 547,039 | 545,820 | ||||
Retained earnings (deficit) | (1,067,522) | (1,095,162) | ||||
Treasury stock, at cost | (24,167) | (24,167) | ||||
Total shareholders' equity (deficit) | (544,649) | (573,508) | ||||
Total liabilities and shareholders' equity (deficit) | 942,176 | 907,580 | ||||
Parent Company | ||||||
Current assets: | ||||||
Cash and cash equivalents | 130,711 | 99,058 | $ 126,095 | $ 70,236 | ||
Receivables: | ||||||
Oil and natural gas sales | 3,842 | 5,665 | ||||
Joint interest | 17,835 | 19,754 | ||||
Income taxes | 186,134 | 128,835 | ||||
Total receivables | 207,811 | 154,254 | ||||
Prepaid expenses and other assets | 14,592 | 11,154 | ||||
Total current assets | 353,114 | 264,466 | ||||
Oil and natural gas properties and other, net | 406,308 | 430,354 | ||||
Restricted deposits for asset retirement obligations | 25,622 | 25,394 | ||||
Income taxes receivable | 52,097 | |||||
Other assets | 577,871 | 505,304 | ||||
Total assets | 1,362,915 | 1,277,615 | ||||
Current liabilities: | ||||||
Accounts payable | 70,997 | 76,703 | ||||
Undistributed oil and natural gas proceeds | 20,598 | 18,762 | ||||
Asset retirement obligations | 23,635 | 22,488 | ||||
Long-term debt | 22,858 | 22,925 | ||||
Accrued liabilities | 23,437 | 18,058 | ||||
Total current liabilities | 161,525 | 158,936 | ||||
Long-term debt: | ||||||
Principal | 889,790 | 889,790 | ||||
Carrying value adjustments | 77,691 | 79,337 | ||||
Long term debt, less current portion - carrying value | 967,481 | 969,127 | ||||
Asset retirement obligations, less current portion | 154,861 | 152,883 | ||||
Other liabilities | 617,034 | 566,375 | ||||
Shareholders’ deficit: | ||||||
Common stock | 1 | 1 | ||||
Additional paid-in capital | 547,039 | 545,820 | ||||
Retained earnings (deficit) | (1,060,859) | (1,091,360) | ||||
Treasury stock, at cost | (24,167) | (24,167) | ||||
Total shareholders' equity (deficit) | (537,986) | (569,706) | ||||
Total liabilities and shareholders' equity (deficit) | 1,362,915 | 1,277,615 | ||||
Guarantor Subsidiaries | ||||||
Receivables: | ||||||
Oil and natural gas sales | 41,100 | 39,778 | ||||
Total receivables | 41,100 | 39,778 | ||||
Prepaid expenses and other assets | 3,206 | 2,265 | ||||
Total current assets | 44,306 | 42,043 | ||||
Oil and natural gas properties and other, net | 128,745 | 152,464 | ||||
Other assets | 503,839 | 453,306 | ||||
Total assets | 676,890 | 647,813 | ||||
Current liabilities: | ||||||
Accounts payable | 5,477 | 6,962 | ||||
Undistributed oil and natural gas proceeds | 1,675 | 1,367 | ||||
Asset retirement obligations | 2,113 | 1,125 | ||||
Accrued liabilities | 120,887 | 115,701 | ||||
Total current liabilities | 130,152 | 125,155 | ||||
Long-term debt: | ||||||
Asset retirement obligations, less current portion | 125,862 | 123,950 | ||||
Shareholders’ deficit: | ||||||
Additional paid-in capital | 704,885 | 704,885 | ||||
Retained earnings (deficit) | (284,009) | (306,177) | ||||
Total shareholders' equity (deficit) | 420,876 | 398,708 | ||||
Total liabilities and shareholders' equity (deficit) | 676,890 | 647,813 | ||||
Non-Guarantor Adjustments | ||||||
Receivables: | ||||||
Prepaid expenses and other assets | 2,399 | |||||
Total current assets | 2,399 | |||||
Oil and natural gas properties and other, net | 44,947 | |||||
Other assets | (46,378) | |||||
Total assets | 968 | |||||
Current liabilities: | ||||||
Accounts payable | 970 | |||||
Total current liabilities | 970 | |||||
Long-term debt: | ||||||
Asset retirement obligations, less current portion | 12 | |||||
Shareholders’ deficit: | ||||||
Retained earnings (deficit) | (14) | |||||
Total shareholders' equity (deficit) | (14) | |||||
Total liabilities and shareholders' equity (deficit) | 968 | |||||
Eliminations | ||||||
Receivables: | ||||||
Income taxes | (121,031) | (115,829) | ||||
Total receivables | (121,031) | (115,829) | ||||
Total current assets | (121,031) | (115,829) | ||||
Oil and natural gas properties and other, net | (6,648) | (3,802) | ||||
Other assets | (970,918) | (898,217) | ||||
Total assets | (1,098,597) | (1,017,848) | ||||
Current liabilities: | ||||||
Accrued liabilities | (121,031) | (115,829) | ||||
Total current liabilities | (121,031) | (115,829) | ||||
Long-term debt: | ||||||
Other liabilities | (550,041) | (499,509) | ||||
Shareholders’ deficit: | ||||||
Additional paid-in capital | (704,885) | (704,885) | ||||
Retained earnings (deficit) | 277,360 | 302,375 | ||||
Total shareholders' equity (deficit) | (427,525) | (402,510) | ||||
Total liabilities and shareholders' equity (deficit) | $ (1,098,597) | $ (1,017,848) |
Supplemental Guarantor Inform51
Supplemental Guarantor Information - Condensed Consolidating Statement of Operations (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Condensed Income Statements Captions [Line Items] | ||
Revenues | $ 134,213 | $ 124,393 |
Operating costs and expenses: | ||
Lease operating expenses | 36,843 | 40,164 |
Production taxes | 455 | 515 |
Gathering and transportation | 5,057 | 6,209 |
Depreciation, depletion, amortization and accretion | 38,081 | 39,990 |
General and administrative expenses | 15,038 | 13,274 |
Derivative gain | (3,955) | |
Total costs and expenses | 95,474 | 96,197 |
Operating income | 38,739 | 28,196 |
Interest expense incurred | 11,323 | 11,294 |
Other (income) expense, net | (333) | 191 |
Income before income tax expense (benefit) | 27,749 | 16,711 |
Income tax expense (benefit) | 109 | (7,588) |
Net income | 27,640 | 24,299 |
Parent Company | ||
Condensed Income Statements Captions [Line Items] | ||
Revenues | 63,786 | 53,707 |
Operating costs and expenses: | ||
Lease operating expenses | 19,760 | 23,702 |
Production taxes | 455 | 515 |
Gathering and transportation | 2,703 | 2,566 |
Depreciation, depletion, amortization and accretion | 19,420 | 19,154 |
General and administrative expenses | 7,203 | 5,776 |
Derivative gain | (3,955) | |
Total costs and expenses | 49,541 | 47,758 |
Operating income | 14,245 | 5,949 |
Earnings of affiliates | 22,167 | 17,527 |
Interest expense incurred | 11,323 | 11,294 |
Other (income) expense, net | (336) | 191 |
Income before income tax expense (benefit) | 25,425 | 11,991 |
Income tax expense (benefit) | (5,076) | (13,039) |
Net income | 30,501 | 25,030 |
Guarantor Subsidiaries | ||
Condensed Income Statements Captions [Line Items] | ||
Revenues | 70,427 | 70,686 |
Operating costs and expenses: | ||
Lease operating expenses | 17,083 | 16,462 |
Gathering and transportation | 2,354 | 3,643 |
Depreciation, depletion, amortization and accretion | 15,814 | 20,105 |
General and administrative expenses | 7,824 | 7,498 |
Total costs and expenses | 43,075 | 47,708 |
Operating income | 27,352 | 22,978 |
Income before income tax expense (benefit) | 27,352 | 22,978 |
Income tax expense (benefit) | 5,185 | 5,451 |
Net income | 22,167 | 17,527 |
Non-Guarantor Adjustments | ||
Operating costs and expenses: | ||
General and administrative expenses | 11 | |
Total costs and expenses | 11 | |
Operating income | (11) | |
Other (income) expense, net | 3 | |
Income before income tax expense (benefit) | (14) | |
Net income | (14) | |
Eliminations | ||
Operating costs and expenses: | ||
Depreciation, depletion, amortization and accretion | 2,847 | 731 |
Total costs and expenses | 2,847 | 731 |
Operating income | (2,847) | (731) |
Earnings of affiliates | (22,167) | (17,527) |
Income before income tax expense (benefit) | (25,014) | (18,258) |
Net income | $ (25,014) | $ (18,258) |
Supplemental Guarantor Inform52
Supplemental Guarantor Information - Condensed Consolidating Statement of Cash Flows (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Operating activities: | ||
Net income | $ 27,640 | $ 24,299 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation, depletion, amortization and accretion | 38,081 | 39,990 |
Amortization of debt items | 466 | 412 |
Share-based compensation | 1,219 | 1,928 |
Derivative gain | (3,955) | |
Cash receipts on derivative settlements, net | 713 | |
Deferred income taxes | 109 | 105 |
Changes in operating assets and liabilities: | ||
Oil and natural gas receivables | 501 | (1,882) |
Joint interest receivables | 1,919 | 5,042 |
Insurance reimbursements | 30,100 | |
Prepaid expenses and other assets | (6,391) | (7,972) |
Asset retirement obligation settlements | (7,022) | (14,499) |
Cash advances from JV partners | 19,147 | (2,531) |
Accounts payable, accrued liabilities and other | (688) | 9,433 |
Net cash provided by operating activities | 74,981 | 81,183 |
Investing activities: | ||
Investment in oil and natural gas properties and equipment | (21,117) | (23,338) |
Changes in operating assets and liabilities associated with investing activities | (17,154) | 1,168 |
Deposit for acquisition | (3,000) | |
Purchases of furniture, fixtures and other | (853) | |
Net cash used in investing activities | (41,271) | (23,023) |
Financing activities: | ||
Other | (245) | |
Net cash used in financing activities | (2,057) | (2,301) |
Increase in cash and cash equivalents | 31,653 | 55,859 |
Cash and cash equivalents, beginning of period | 99,058 | 70,236 |
Cash and cash equivalents, end of period | 130,711 | 126,095 |
Parent Company | ||
Operating activities: | ||
Net income | 30,501 | 25,030 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation, depletion, amortization and accretion | 19,420 | 19,154 |
Amortization of debt items | 466 | 412 |
Share-based compensation | 1,219 | 1,928 |
Derivative gain | (3,955) | |
Cash receipts on derivative settlements, net | 713 | |
Deferred income taxes | 109 | 105 |
Earnings of affiliates | (22,167) | (17,527) |
Changes in operating assets and liabilities: | ||
Oil and natural gas receivables | 1,823 | (2,004) |
Joint interest receivables | 1,919 | 5,042 |
Insurance reimbursements | 30,100 | |
Income taxes | (5,186) | (5,451) |
Prepaid expenses and other assets | 25,275 | (6,927) |
Asset retirement obligation settlements | (5,633) | (12,940) |
Cash advances from JV partners | 13,129 | (2,531) |
Accounts payable, accrued liabilities and other | 2,403 | 49,295 |
Net cash provided by operating activities | 63,278 | 80,444 |
Investing activities: | ||
Investment in oil and natural gas properties and equipment | (10,674) | (23,593) |
Changes in operating assets and liabilities associated with investing activities | (15,894) | 2,162 |
Deposit for acquisition | (3,000) | |
Purchases of furniture, fixtures and other | (853) | |
Net cash used in investing activities | (29,568) | (22,284) |
Financing activities: | ||
Other | (245) | |
Net cash used in financing activities | (2,057) | (2,301) |
Increase in cash and cash equivalents | 31,653 | 55,859 |
Cash and cash equivalents, beginning of period | 99,058 | 70,236 |
Cash and cash equivalents, end of period | 130,711 | 126,095 |
Guarantor Subsidiaries | ||
Operating activities: | ||
Net income | 22,167 | 17,527 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation, depletion, amortization and accretion | 15,814 | 20,105 |
Changes in operating assets and liabilities: | ||
Oil and natural gas receivables | (1,322) | 122 |
Income taxes | 5,186 | 5,451 |
Prepaid expenses and other assets | (31,783) | (42,395) |
Asset retirement obligation settlements | (1,389) | (1,559) |
Cash advances from JV partners | 6,018 | |
Accounts payable, accrued liabilities and other | (4,965) | 1,488 |
Net cash provided by operating activities | 9,726 | 739 |
Investing activities: | ||
Investment in oil and natural gas properties and equipment | (7,496) | 255 |
Changes in operating assets and liabilities associated with investing activities | (2,230) | (994) |
Net cash used in investing activities | (9,726) | (739) |
Non-Guarantor Adjustments | ||
Operating activities: | ||
Net income | (14) | |
Changes in operating assets and liabilities: | ||
Prepaid expenses and other assets | 1,991 | |
Net cash provided by operating activities | 1,977 | |
Investing activities: | ||
Investment in oil and natural gas properties and equipment | (2,947) | |
Changes in operating assets and liabilities associated with investing activities | 970 | |
Net cash used in investing activities | (1,977) | |
11.00% 1.5 Lien Term Loan, Due November 2019 | ||
Financing activities: | ||
Payment of interest | (2,057) | (2,056) |
11.00% 1.5 Lien Term Loan, Due November 2019 | Parent Company | ||
Financing activities: | ||
Payment of interest | (2,057) | (2,056) |
Eliminations | ||
Operating activities: | ||
Net income | (25,014) | (18,258) |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation, depletion, amortization and accretion | 2,847 | 731 |
Earnings of affiliates | 22,167 | 17,527 |
Changes in operating assets and liabilities: | ||
Prepaid expenses and other assets | (1,874) | 41,350 |
Accounts payable, accrued liabilities and other | $ 1,874 | $ (41,350) |