Document_and_Entity_Informatio
Document and Entity Information | 3 Months Ended | |
Mar. 31, 2014 | 8-May-14 | |
Document and Entity Information [Abstract] | ' | ' |
Entity Registrant Name | 'MAGNUM HUNTER RESOURCES CORP | ' |
Entity Central Index Key | '0001335190 | ' |
Document Type | '10-Q | ' |
Document Period End Date | 31-Mar-14 | ' |
Amendment Flag | 'false | ' |
Current Fiscal Year End Date | '--12-31 | ' |
Entity Filer Category | 'Large Accelerated Filer | ' |
Entity Common Stock, Shares Outstanding | ' | 177,331,298 |
Document Fiscal Year Focus | '2014 | ' |
Document Fiscal Period Focus | 'Q1 | ' |
CONSOLIDATED_BALANCE_SHEETS_Un
CONSOLIDATED BALANCE SHEETS (Unaudited) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
CURRENT ASSETS | ' | ' |
Cash and cash equivalents | $64,452 | $41,713 |
Restricted cash | 5,000 | 5,000 |
Oil and natural gas sales | 28,698 | 25,099 |
Joint interests and other, net of allowance for doubtful accounts of $101 at March 31, 2014 and $196 at December 31, 2013 | 34,010 | 30,582 |
Derivative assets | 35 | 608 |
Inventory | 4,052 | 7,158 |
Investments | 11,436 | 2,262 |
Prepaid expenses and other assets | 3,471 | 2,938 |
Assets held for sale | 5,018 | 5,366 |
Total current assets | 156,172 | 120,726 |
PROPERTY, PLANT AND EQUIPMENT | ' | ' |
Oil and natural gas properties, successful efforts method of accounting, net | 1,221,298 | 1,224,659 |
Gas transportation, gathering and processing equipment and other, net | 317,187 | 289,420 |
Total property, plant and equipment, net | 1,538,485 | 1,514,079 |
OTHER ASSETS | ' | ' |
Deferred financing costs, net of amortization of $9,511 at March 31, 2014 and $9,735 at December 31, 2013 | 17,738 | 20,008 |
Derivative assets, long-term | 585 | 25 |
Intangible assets, net | 6,029 | 6,530 |
Goodwill | 30,602 | 30,602 |
Assets held for sale | 142,349 | 162,687 |
Other assets | 1,893 | 1,994 |
Total assets | 1,893,853 | 1,856,651 |
CURRENT LIABILITIES | ' | ' |
Current portion of notes payable | 5,372 | 3,804 |
Accounts payable | 136,740 | 107,837 |
Accounts payable to related parties | 451 | 23 |
Accrued liabilities | 68,245 | 44,629 |
Revenue payable | 11,317 | 6,313 |
Derivative liabilities | 5,276 | 1,903 |
Liabilities associated with assets held for sale | 20,159 | 12,865 |
Other liabilities | 2,456 | 6,491 |
Total current liabilities | 250,016 | 183,865 |
Long-term debt | 891,534 | 876,106 |
Asset retirement obligations | 16,546 | 16,163 |
Derivative liabilities, long-term | 72,611 | 76,310 |
Other long-term liabilities | 2,218 | 2,279 |
Long-term liabilities associated with assets held for sale | 12,983 | 14,523 |
Total liabilities | 1,245,908 | 1,169,246 |
COMMITMENTS AND CONTINGENCIES (Note 16) | ' | ' |
REDEEMABLE PREFERRED STOCK | ' | ' |
Redeemable preferred stock | 242,275 | 236,675 |
SHAREHOLDERS’ EQUITY | ' | ' |
Common stock, $0.01 par value per share, 350,000,000 shares authorized, and 177,331,297 and 172,409,023 issued, and 176,416,345 and 171,494,071 outstanding as of March 31, 2014 and December 31, 2013, respectively | 1,773 | 1,724 |
Additional paid in capital | 767,645 | 733,753 |
Accumulated deficit | -662,853 | -586,365 |
Accumulated other comprehensive loss | -22,305 | -19,901 |
Treasury stock, at cost | -1,914 | -1,914 |
Total Magnum Hunter Resources Corporation shareholders’ equity | 396,629 | 441,580 |
Non-controlling interest | 9,041 | 9,150 |
Total shareholders’ equity | 405,670 | 450,730 |
Total liabilities and shareholders’ equity | 1,893,853 | 1,856,651 |
Series C Cumulative Perpetual Preferred Stock | ' | ' |
REDEEMABLE PREFERRED STOCK | ' | ' |
Redeemable preferred stock | 100,000 | 100,000 |
Series A Preferred Units | ' | ' |
REDEEMABLE PREFERRED STOCK | ' | ' |
Redeemable preferred stock | 142,275 | 136,675 |
Series D Cumulative Perpetual Preferred Stock | ' | ' |
SHAREHOLDERS’ EQUITY | ' | ' |
Preferred Stock | 221,244 | 221,244 |
Series E Cumulative Convertible Preferred Stock | ' | ' |
SHAREHOLDERS’ EQUITY | ' | ' |
Preferred Stock | 95,069 | 95,069 |
Treasury stock, at cost | ($2,030) | ($2,030) |
CONSOLIDATED_BALANCE_SHEETS_Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $) | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2014 | Dec. 31, 2012 | Dec. 31, 2013 | |
Accounts receivable, allowance for doubtful accounts | $101,000 | ' | $196,000 |
Amortization of deferred financing costs | 9,511,000 | ' | 9,735,000 |
Preferred stock, shares authorized | 10,000,000 | ' | 10,000,000 |
Common stock, par value (in dollars per share) | $0.01 | ' | $0.01 |
Common stock, shares authorized | 350,000,000 | ' | 250,000,000 |
Common stock, shares issued | 177,331,297 | ' | 172,409,023 |
Common stock, shares outstanding | 176,416,345 | ' | 171,494,071 |
Treasury stock, shares | 914,952 | ' | 914,952 |
Series C Cumulative Perpetual Preferred Stock | ' | ' | ' |
Cumulative dividend rate (as a percent) | 10.25% | 10.25% | ' |
Preferred stock, shares authorized | 4,000,000 | ' | 4,000,000 |
Preferred stock, shares issued | 4,000,000 | ' | 4,000,000 |
Preferred stock, shares outstanding | 4,000,000 | ' | 4,000,000 |
Preferred stock, liquidation preference (in dollars per share) | $25 | ' | $25 |
Series A Preferred Units | ' | ' | ' |
Cumulative dividend rate (as a percent) | 8.00% | 8.00% | ' |
Preferred stock, shares issued | 10,182,540 | ' | 9,885,048 |
Preferred stock, shares outstanding | 10,182,540 | ' | 9,885,048 |
Preferred stock, liquidation preference | $206,520 | ' | $200,620 |
Series D Cumulative Perpetual Preferred Stock | ' | ' | ' |
Preferred stock, shares authorized | 5,750,000 | ' | 5,750,000 |
Cumulative dividend rate for cumulative preferred stock (as a percent) | 8.00% | 8.00% | ' |
Preferred stock, shares issued | 4,424,889 | ' | 4,424,889 |
Preferred Stock, Shares Outstanding | 4,424,889 | ' | 4,424,889 |
Preferred stock, liquidation preference (in dollars per share) | $50 | ' | $50 |
Series E Cumulative Convertible Preferred Stock | ' | ' | ' |
Preferred stock, shares authorized | 12,000 | ' | 12,000 |
Cumulative dividend rate for cumulative preferred stock (as a percent) | 8.00% | 8.00% | ' |
Preferred stock, shares issued | 3,803 | ' | 3,803 |
Preferred Stock, Shares Outstanding | 3,722 | ' | 3,722 |
Preferred stock, liquidation preference (in dollars per share) | $25,000 | ' | $25,000 |
Treasury stock, shares | 81 | ' | 70 |
Exchangeable Common Stock | ' | ' | ' |
Common stock, par value (in dollars per share) | $0.01 | ' | $0.01 |
Common stock, shares issued | 505,835 | ' | 505,835 |
Common stock, shares outstanding | 505,835 | ' | 505,835 |
UNAUDITED_CONSOLIDATED_STATEME
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) (USD $) | 3 Months Ended | |
In Thousands, except Share data, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
REVENUES AND OTHER | ' | ' |
Oil and natural gas sales | $70,172 | $34,641 |
Natural gas transportation, gathering, processing, and marketing | 31,649 | 15,896 |
Oilfield services | 5,621 | 3,693 |
Other revenue | 2 | 4 |
Total revenue | 107,444 | 54,234 |
OPERATING EXPENSES | ' | ' |
Lease operating expenses | 19,956 | 7,668 |
Severance taxes and marketing | 5,574 | 2,832 |
Exploration | 14,029 | 29,733 |
Natural gas transportation, gathering, processing, and marketing | 29,999 | 13,431 |
Oilfield services | 3,947 | 3,335 |
Depletion, depreciation, amortization and accretion | 29,408 | 17,288 |
Loss (gain) on sale of assets, net | 3,459 | -19 |
General and administrative | 15,272 | 19,977 |
Total operating expenses | 121,644 | 94,245 |
OPERATING LOSS | -14,200 | -40,011 |
OTHER INCOME (EXPENSE) | ' | ' |
Interest income | 45 | 57 |
Interest expense | -23,849 | -18,701 |
Gain (loss) on derivative contracts, net | 347 | -7,491 |
Other expense | -244 | -216 |
Total other expense, net | -23,701 | -26,351 |
LOSS FROM CONTINUING OPERATIONS BEFORE INCOME TAX | -37,901 | -66,362 |
Income tax benefit | 0 | 4,899 |
LOSS FROM CONTINUING OPERATIONS, NET OF TAX | -37,901 | -61,463 |
Income from discontinued operations, net of tax | 3,362 | 16,763 |
Loss on disposal of discontinued operations, net of tax | -27,162 | 0 |
NET LOSS | -61,701 | -44,700 |
Net loss attributed to non-controlling interests | 109 | 503 |
LOSS ATTRIBUTABLE TO MAGNUM HUNTER RESOURCES CORPORATION | -61,592 | -44,197 |
Dividends on preferred stock | -14,896 | -13,488 |
NET LOSS ATTRIBUTABLE TO COMMON SHAREHOLDERS | -76,488 | -57,685 |
Weighted average number of common shares outstanding, basic and diluted | 172,146,431 | 169,624,616 |
Loss from continuing operations per share, basic and diluted | ($0.30) | ($0.44) |
Income from discontinued operations per share, basic and diluted | ($0.14) | $0.10 |
NET LOSS PER COMMON SHARE, BASIC AND DILUTED | ($0.44) | ($0.34) |
Loss from continuing operations, net of tax | -37,792 | -60,960 |
Income (loss) from discontinued operations, net of tax | -23,800 | 16,763 |
Net loss | ($61,592) | ($44,197) |
UNAUDITED_CONSOLIDATED_STATEME1
UNAUDITED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (Unaudited) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Statement of Comprehensive Income [Abstract] | ' | ' |
Net loss | ($61,701) | ($44,700) |
OTHER COMPREHENSIVE INCOME (LOSS) | ' | ' |
Foreign currency translation loss | -2,348 | -4,729 |
Unrealized loss on available for sale investments | -56 | -17 |
Total other comprehensive income (loss) | -2,404 | -4,746 |
COMPREHENSIVE LOSS | -64,105 | -49,446 |
Comprehensive loss attributable to non-controlling interests | 109 | 503 |
COMPREHENSIVE LOSS ATTRIBUTABLE TO MAGNUM HUNTER RESOURCES CORPORATION | ($63,996) | ($48,943) |
UNAUDITED_CONSOLIDATED_STATEME2
UNAUDITED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (Unaudited) (USD $) | Total | Common Stock | Additional Paid in Capital | Accumulated Deficit | Accumulated Other Comprehensive Income | Treasury Stock | Non - controlling Interest | Series D Preferred Stock | Series E Preferred Stock | Series E Preferred Stock |
In Thousands, except Share data, unless otherwise specified | Preferred Stock | Preferred Stock | ||||||||
BALANCE at Dec. 31, 2013 | $450,730 | $1,724 | $733,753 | ($586,365) | ($19,901) | ($3,944) | $9,150 | $221,244 | ' | $95,069 |
BALANCE (in shares) at Dec. 31, 2013 | ' | 172,409,000 | ' | ' | ' | ' | ' | 4,425,000 | ' | 4,000 |
Increase (Decrease) in Shareholders' Equity | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Share based compensation (in shares) | ' | 25,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Share based compensation | 1,061 | 0 | 1,061 | ' | ' | ' | ' | ' | ' | ' |
Sale of common stock (in shares) | ' | 4,300,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Sale of common stock | 28,897 | 43 | 28,854 | ' | ' | ' | ' | ' | ' | ' |
Dividends on preferred stock | -14,896 | ' | ' | -14,896 | ' | ' | ' | ' | ' | ' |
Shares of common stock issued upon exercise of common stock options (in shares) | ' | 597,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Shares of common stock issued upon exercise of common stock options | ' | 6 | 3,977 | ' | ' | ' | ' | ' | 3,983 | ' |
Net loss | -61,701 | ' | ' | -61,592 | ' | ' | -109 | ' | ' | ' |
Foreign currency translation gain (loss) | -2,348 | ' | ' | ' | -2,348 | ' | ' | ' | ' | ' |
Unrealized gain on available for sale securities | -56 | ' | ' | ' | -56 | ' | ' | ' | ' | ' |
BALANCE at Mar. 31, 2014 | $405,670 | $1,773 | $767,645 | ($662,853) | ($22,305) | ($3,944) | $9,041 | $221,244 | ' | $95,069 |
BALANCE (in shares) at Mar. 31, 2014 | ' | 177,331,000 | ' | ' | ' | ' | ' | 4,425,000 | ' | 4,000 |
UNAUDITED_CONSOLIDATED_STATEME3
UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Statement of Cash Flows [Abstract] | ' | ' |
Net loss | ($61,701) | ($44,700) |
Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | ' | ' |
Depletion, depreciation, amortization and accretion | 29,408 | 35,092 |
Exploration | 13,712 | 29,353 |
Share-based compensation | 1,061 | 6,250 |
Cash paid for plugging wells | -22 | ' |
Loss (gain) on sale of assets | 31,238 | -19 |
Unrealized (gain) loss on derivative contracts | -2,631 | 8,447 |
Unrealized loss on investments | 246 | 606 |
Amortization and write-off of deferred financing costs and discount on Senior Notes included in interest expense | 3,621 | 857 |
Deferred tax benefit | ' | -4,854 |
Changes in operating assets and liabilities: | ' | ' |
Accounts receivable, net | -7,828 | -2,865 |
Inventory | 3,246 | -506 |
Prepaid expenses and other current assets | -562 | -269 |
Accounts payable | -26,020 | 30,115 |
Revenue payable | 4,841 | 5,580 |
Accrued liabilities | 15,268 | 14,534 |
Net cash provided by operating activities | 3,877 | 77,621 |
CASH FLOWS FROM INVESTING ACTIVITIES | ' | ' |
Capital expenditures and advances | -39,127 | -144,534 |
Change in deposits and other long-term assets | -107 | 57 |
Proceeds from sales of assets | 16,415 | 40 |
Net cash used in investing activities | -22,819 | -144,437 |
CASH FLOWS FROM FINANCING ACTIVITIES | ' | ' |
Net proceeds from sale of common shares | 28,897 | 0 |
Net proceeds from sale of preferred shares | ' | 10,264 |
Equity issuance costs | 0 | -109 |
Proceeds from sale of Eureka Hunter Holdings Series A Preferred Units | 3,920 | ' |
Proceeds from exercise of warrants and options | 3,983 | ' |
Preferred stock dividend | -10,770 | -9,657 |
Repayments of debt | -84,683 | -993 |
Proceeds from borrowings on debt | 101,616 | 101,366 |
Deferred financing costs | -1,331 | -445 |
Change in other long-term liabilities | 24 | -36 |
Net cash provided by financing activities | 41,656 | 100,390 |
Effect of changes in exchange rate on cash | 25 | -21 |
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | 22,739 | 33,553 |
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD | 41,713 | ' |
CASH AND CASH EQUIVALENTS, END OF PERIOD | $64,452 | $91,176 |
GENERAL
GENERAL | 3 Months Ended |
Mar. 31, 2014 | |
Accounting Policies [Abstract] | ' |
GENERAL | ' |
NOTE 1 - GENERAL | |
Organization and Nature of Operations | |
Magnum Hunter Resources Corporation, a Delaware corporation, operating directly and indirectly through its subsidiaries (together with its subsidiaries, the “Company” or “Magnum Hunter”), is a Houston, Texas based independent exploration and production company engaged in the acquisition and development of producing properties and undeveloped acreage and the production of oil and natural gas, in the United States and Canada, along with certain midstream and oil field services activities. | |
Presentation of Consolidated Financial Statements | |
The accompanying unaudited interim consolidated financial statements of Magnum Hunter are presented in U.S. Dollars and have been prepared in accordance with accounting principles generally accepted in the United States ("GAAP"). The preparation of these consolidated financial statements in accordance 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 revenue and expenses during reporting periods. Actual results could differ materially from those estimates. | |
In the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary for the fair statement of the financial position and the results of operations for the interim periods presented have been reflected herein. The results of operations for interim periods are not necessarily indicative of the results to be expected for the full year. The year-end balance sheet data were derived from audited financial statements, but do not include all disclosures required by GAAP. | |
Certain information and disclosures normally included in the consolidated financial statements prepared in accordance with GAAP that would substantially duplicate the disclosures contained in the audited consolidated financial statements as reported in the Company's Annual Report on Form 10-K have been condensed or omitted. These consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company's Annual Report on Form 10-K for the year ended December 31, 2013, as amended. | |
Non-Controlling Interest in Consolidated Subsidiaries | |
The Company has consolidated Eureka Hunter Holdings, LLC (“Eureka Hunter Holdings”) in which it owned 55.79% as of March 31, 2014 and 56.4% as of December 31, 2013. Eureka Hunter Holdings owns, directly or indirectly, 100% of the equity interests of Eureka Hunter Pipeline, LLC ("Eureka Hunter Pipeline"), TransTex Hunter, LLC ("TransTex Hunter"), and Eureka Hunter Land, LLC. On December 30, 2013, the Company's subsidiary, PRC Williston, LLC ("PRC Williston"), in which the Company owns 87.5%, sold substantially all of its assets. The consolidated financial statements also reflect the interests of Magnum Hunter Production, Inc. ("MHP") in various managed drilling partnerships. The Company accounts for the interests in these partnerships using the proportionate consolidation method. | |
Reclassification of Prior-Year Balances | |
Certain prior period balances have been reclassified to correspond with current-year presentation. As a result of the Company's adoption of a plan in September 2013 to dispose of certain of its U.S. and Canadian properties, operating income and expenses related to these operations have been classified as discontinued operations for all periods presented. See "Note 2 - Divestitures and Discontinued Operations". | |
Regulated Activities | |
Energy Hunter Securities, Inc. is a 100%-owned subsidiary and is a registered broker-dealer and member of the Financial Industry Regulatory Authority. Among other regulatory requirements, it is subject to the net capital provisions of Rule 15c3-1 under the Securities Exchange Act of 1934, as amended. Because it does not hold customer funds or securities or owe money or securities to customers, Energy Hunter Securities, Inc. is required to maintain minimum net capital equal to the greater of $5,000 or 6.67% of its aggregate indebtedness. At March 31, 2014 and December 31, 2013, Energy Hunter Securities, Inc. had net capital of $90,610 and $77,953, respectively, and aggregate indebtedness of $4,000 and $16,657, respectively. | |
Sentra Corporation, a 100%-owned subsidiary, owns and operates distribution systems for retail sales of natural gas in south central Kentucky. Sentra Corporation's gas distribution billing rates are regulated by the Kentucky Public Service Commission based on recovery of purchased gas costs. The Company accounts for its operations based on the provisions of ASC 980-605, Regulated Operations-Revenue Recognition, which requires covered entities to record regulatory assets and liabilities resulting from actions of regulators. During the three months ended March 31, 2014, the Company had gas transmission, compression and processing revenue, reported in income from discontinued operations, which included gas utility sales from Sentra Corporation's regulated operations aggregating to $171,072. During the three months ended March 31, 2013, the Company had no revenues related to Sentra Corporation's regulated operations. | |
Recently Issued Accounting Standards | |
Accounting standards-setting organizations frequently issue new or revised accounting rules. The Company regularly reviews all new pronouncements to determine their impact, if any, on its financial statements. | |
In July 2013, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2013-11, Presentation of Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists, an amendment to FASB Accounting Standards Codification ("ASC") Topic 740, Income Taxes ("FASB ASC Topic 740"). This update clarified that an unrecognized tax benefit, or a portion of an unrecognized tax benefit, should be presented in the financial statements as a reduction to a deferred tax asset for a net operating loss carryforward, a similar tax loss, or a tax credit carryforward if such settlement is required or expected in the event the uncertain tax position is disallowed. In situations where a net operating loss carryforward, a similar tax loss, or a tax credit carryforward is not available at the reporting date under the tax law of the applicable jurisdiction or the tax law of the jurisdiction does not require, and the entity does not intend to use, the deferred tax asset for such purpose, the unrecognized tax benefit should be presented in the financial statements as a liability and should not be combined with deferred tax assets. The Company adopted this ASU prospectively on January 1, 2014. The adoption of this accounting standard update did not have a material impact on the Company's consolidated financial statements or its financial statement disclosures. | |
In March, 2013, the FASB issued ASU 2013-05, Parent’s Accounting for the Cumulative Translation Adjustment upon Derecognition of Certain Subsidiaries or Groups of Assets within a Foreign Entity or of an Investment in a Foreign Entity, to provide guidance on whether to release cumulative translation adjustments (“CTA”) upon certain derecognition events. ASU 2013-05 requires a parent company to apply the guidance in ASC Subtopic 830-30 when an entity ceases to have a controlling financial interest in a subsidiary or group of assets that is a business within a foreign entity. Consequently, the CTA related to a foreign entity is released into net income only if the transaction results in complete or substantially complete liquidation of the foreign entity in which the subsidiary or group of assets resided; otherwise, no portion of the CTA is released. The Company adopted this pronouncement prospectively on January 1, 2014. The adoption of this updated standard did not have a material impact on the Company’s consolidated financial statements. | |
In April 2014, the FASB issued ASU 2014-08 , Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity. ASU 2014-08 updates the requirements for reporting discontinued operations in ASC Subtopic 205-20, Presentation of Financial Statements - Discontinued Operations, by requiring classification as discontinued operations of a component of an entity or a group of components of an entity if the disposal represents a strategic shift that has (or will have) a major effect on an entity's operations and financial results when either 1) the component or group of components of an entity meet the criteria to be classified as held for sale, 2) are disposed of by sale, or 3) are disposed of other than by sale (e.g. abandonment or a distribution to owners in a spinoff). The amendments in this update expand the disclosure requirements related to discontinued operations and disposals of individually significant components that do not qualify for discontinued operations presentation in the financial statements. | |
This ASU is effective prospectively for all disposals (or classification as held for sale) of components of an entity that occur within annual periods beginning on or after December 15, 2014, and interim periods within those years. The Company is currently evaluating the impact of this ASU on its consolidated financial statements and financial statement disclosures. |
DIVESTITURES_AND_DISCONTINUED_
DIVESTITURES AND DISCONTINUED OPERATIONS | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Discontinued Operations and Disposal Groups [Abstract] | ' | ||||||||
DIVESTITURES AND DISCONTINUED OPERATIONS | ' | ||||||||
NOTE 2 - DIVESTITURES AND DISCONTINUED OPERATIONS | |||||||||
Discontinued Operations | |||||||||
Planned Divestitures of Magnum Hunter Production and Williston Hunter Canada | |||||||||
In September 2013, the Company adopted a plan to divest all of its interests in (i) Magnum Hunter Production, Inc. (“MHP”), a wholly-owned subsidiary of the Company whose oil and natural gas operations are located primarily in the Southern Appalachian Basin in Kentucky and Tennessee, and (ii) the Canadian operations of Williston Hunter Canada, Inc. ("WHI Canada"), a wholly-owned subsidiary of the Company. | |||||||||
On April 10, 2014, the Company, through WHI Canada, closed on the sale of a portion of its interests in oil and natural gas properties and related assets in Alberta, Canada which were classified as held for sale at March 31, 2014 and December 31, 2013. On April 22, 2014, the Company entered into a definitive agreement to sell 100% of its ownership interest in WHI Canada. See "Note 20 - Subsequent Events". The Company is actively marketing its interests in MHP and anticipates entering into a purchase and sale agreement for MHP by the end of the second quarter of 2014. The Company has classified the associated assets and liabilities of MHP and WHI Canada to assets and liabilities held for sale and the operations are reflected as discontinued operations for all periods presented. | |||||||||
During the year ended December 31, 2013, the Company recorded an impairment expense of $92.4 million to record MHP and WHI Canada at their estimated selling price less costs to sell. Based upon additional information on estimated selling prices obtained through active marketing of the assets, the Company has recorded an additional impairment expense of $22.8 million for the three months ended March 31, 2014 to reflect the net assets at their estimated selling prices, less costs to sell, which is recorded in loss on disposal of discontinued operations for the three months ended March 31, 2014. | |||||||||
The following shows the Company's assets and liabilities held for sale at March 31, 2014 and December 31, 2013: | |||||||||
March 31, | December 31, | ||||||||
2014 | 2013 | ||||||||
(in thousands) | |||||||||
Accounts receivable | $ | 3,947 | $ | 4,362 | |||||
Other current assets | 1,071 | 1,004 | |||||||
Oil and natural gas properties, net | 127,068 | 150,770 | |||||||
Gas transportation, gathering, and processing equipment and other, net | 15,099 | 11,721 | |||||||
Other long-term assets | 182 | 196 | |||||||
Total assets held for sale | $ | 147,367 | $ | 168,053 | |||||
Accounts payable | $ | 10,215 | $ | 7,292 | |||||
Accrued expenses and other liabilities | 9,944 | 5,573 | |||||||
Asset retirement obligations | 8,485 | 8,678 | |||||||
Other long-term liabilities | 4,498 | 5,845 | |||||||
Total liabilities held for sale | $ | 33,142 | $ | 27,388 | |||||
Sale of Eagle Ford Hunter | |||||||||
On April 24, 2013, the Company closed on the sale of all of its ownership interest in its wholly-owned subsidiary, Eagle Ford Hunter, Inc. ("Eagle Ford Hunter") to an affiliate of Penn Virginia for a total purchase price of approximately $422.1 million paid to the Company in the form of $379.8 million in cash (after estimated customary initial purchase price adjustments) and 10.0 million shares of common stock of Penn Virginia valued at approximately $42.3 million (based on the closing market price of the stock of $4.23 as of April 24, 2013). The effective date of the sale was January 1, 2013. The Company has recognized a preliminary gain on the sale of $172.5 million, net of tax, pending final working capital adjustments. The Company and Penn Virginia have been unable to agree upon the final settlement of the working capital adjustments and the disagreement has been submitted to arbitration. The Company is currently awaiting the ruling of the arbitrator. | |||||||||
As of March 31, 2014, the Company estimated that the final working capital adjustment is a reduction to the preliminary gain recognized in 2013 ranging from $22 million to $33 million, net of tax. The Company has recorded a liability for its revised estimate of the final adjustment, and has recorded the impact to earnings as a reduction to the gain on disposal of discontinued operations. | |||||||||
The Company included the results of operations of MHP and WHI Canada for all periods presented, and Eagle Ford Hunter through March 31, 2013, in discontinued operations as follows: | |||||||||
Three Months Ended | |||||||||
March 31, | |||||||||
2014 | 2013 | ||||||||
(in thousands) | |||||||||
Revenues | $ | 12,283 | $ | 43,790 | |||||
Expenses | (8,833 | ) | (28,225 | ) | |||||
Other income (expense) | (88 | ) | 1,243 | ||||||
Income tax expense | — | (45 | ) | ||||||
Income from discontinued operations, net of tax | 3,362 | 16,763 | |||||||
Loss on sale of discontinued operations, net of taxes | (27,162 | ) | — | ||||||
Income from discontinued operations, net of taxes | $ | (23,800 | ) | $ | 16,763 | ||||
Other Divestitures | |||||||||
Sale of Certain other Eagle Ford Shale Assets | |||||||||
On January 28, 2014, the Company, through its wholly owned subsidiary Shale Hunter LLC (“Shale Hunter”) and certain other affiliates, closed on the sale of certain of its oil and natural gas properties and related assets located in the Eagle Ford Shale in South Texas to New Standard Energy Texas LLC (“NSE Texas”), a subsidiary of New Standard Energy Limited (“NSE”), an Australian Securities Exchange-listed Australian company. | |||||||||
The assets sold consisted primarily of interests in leasehold acreage located in Atascosa County, Texas and working interests in five horizontal wells, four of which wells were operated by the Company. The effective date of the sale was December 1, 2013. As consideration for the assets sold, the Company received aggregate purchase price consideration of $15.5 million in cash, after customary purchase price adjustments, and 65,650,000 ordinary shares of NSE with a fair value of approximately $9.4 million at January 28, 2014 (based on the closing market price of $0.14 per share on January 28, 2014). These investment holdings represent approximately 17% of the total shares outstanding of NSE at January 28, 2014, and have been designated as available-for-sale securities, which are carried at fair value (See "Note 8 - Fair Value of Financial Instruments"). The Company recognized a loss on the sale of these assets of $4.5 million. | |||||||||
In connection with the closing of the sale, Shale Hunter and NSE Texas entered into a transition services agreement which provides that, during a specified transition period, Shale Hunter will provide NSE Texas with certain transitional services relating to the assets sold for which it will receive a monthly fee. | |||||||||
Upon, and as a result of, the closing of the sale on January 28, 2014, the borrowing base under the Company’s asset-based, senior secured revolving credit facility was automatically reduced by $10.0 million to $232.5 million as of the closing date. |
OIL_NATURAL_GAS_SALES_Notes
OIL & NATURAL GAS SALES (Notes) | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Other Income and Expenses [Abstract] | ' | |||||||
Oil & Natural Gas Sales | ' | |||||||
NOTE 3 - OIL & NATURAL GAS SALES | ||||||||
During the three months ended March 31, 2014 and 2013, the Company recognized sales from oil, natural gas, and natural gas liquids ("NGLs") as follows: | ||||||||
Three Months Ended March 31, | ||||||||
2014 | 2013 | |||||||
(in thousands) | ||||||||
Oil | $ | 34,272 | $ | 25,572 | ||||
Natural gas | 24,130 | 8,453 | ||||||
NGLs | 11,770 | 616 | ||||||
Total oil and natural gas sales | $ | 70,172 | $ | 34,641 | ||||
PROPERTY_PLANT_EQUIPMENT_Notes
PROPERTY, PLANT, & EQUIPMENT (Notes) | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Property, Plant and Equipment [Abstract] | ' | |||||||
Property, Plant, & Equipment | ' | |||||||
NOTE 4 - PROPERTY, PLANT, & EQUIPMENT | ||||||||
Oil and Natural Gas Properties | ||||||||
The following sets forth the net capitalized costs under the successful efforts method for oil and natural gas properties as of: | ||||||||
March 31, | December 31, | |||||||
2014 | 2013 | |||||||
(in thousands) | ||||||||
Mineral interests in properties: | ||||||||
Unproved leasehold costs | $ | 455,772 | $ | 469,337 | ||||
Proved leasehold costs | 335,124 | 336,357 | ||||||
Wells and related equipment and facilities | 570,133 | 536,023 | ||||||
Advances to operators for wells in progress | 12,388 | 13,571 | ||||||
Total costs | 1,373,417 | 1,355,288 | ||||||
Less accumulated depletion, depreciation, and amortization | (152,119 | ) | (130,629 | ) | ||||
Net capitalized costs | $ | 1,221,298 | $ | 1,224,659 | ||||
Proved oil and natural gas properties are reviewed for impairment on a field-by-field basis when events and circumstances indicate a possible decline in the recoverability of the carrying amount of such property. No impairments of proved property were recorded during the three months ended March 31, 2014 or 2013. | ||||||||
Depletion, depreciation, and amortization expense for proved oil and natural gas properties was $23.9 million and $13.0 million for the three months ended March 31, 2014 and 2013, respectively. | ||||||||
Exploration | ||||||||
Exploration expense consists primarily of abandonment charges and impairment expense for capitalized leasehold costs associated with unproved properties for which the Company has no further exploration or development plans, exploratory dry holes, and geological and geophysical costs. | ||||||||
During the three months ended March 31, 2014 and 2013, the Company recognized exploration expense as follows: | ||||||||
Three Months Ended | ||||||||
March 31, | ||||||||
2014 | 2013 | |||||||
(in thousands) | ||||||||
Leasehold impairments | $ | 13,655 | $ | 29,353 | ||||
Geological and geophysical | 374 | 380 | ||||||
Total exploration expense | $ | 14,029 | $ | 29,733 | ||||
Leasehold impairment expense recorded by the Company during the three months ended March 31, 2014 consisted of $11.1 million in the U.S. Upstream segment related to leases in the Williston Basin that expired undrilled during the period or are expected to expire that the Company does not plan to develop, and $2.6 million related to leases in the Appalachian Basin. Leasehold impairment expense of $29.4 million during the three months ended March 31, 2013 primarily related to leases in the Williston Basin. | ||||||||
Capitalized Costs Greater Than a Year | ||||||||
As of March 31, 2014, the Company had no suspended exploratory well costs capitalized for periods greater than one year. | ||||||||
Gas Transportation, Gathering, and Processing Equipment and Other | ||||||||
The historical cost of gas transportation, gathering, and processing equipment and other property, presented on a gross basis with accumulated depreciation, as of March 31, 2014 and December 31, 2013 is summarized as follows: | ||||||||
March 31, | December 31, | |||||||
2014 | 2013 | |||||||
(in thousands) | ||||||||
Gas transportation, gathering and processing equipment and other | $ | 347,995 | $ | 315,642 | ||||
Less accumulated depreciation | (30,808 | ) | (26,222 | ) | ||||
Net capitalized costs | $ | 317,187 | $ | 289,420 | ||||
Depreciation expense for gas transportation, gathering, and processing equipment and other property was $4.7 million and $3.2 million for the three months ended March 31, 2014 and 2013, respectively. | ||||||||
The Company sells and leases gas treating and processing equipment, classified as gas transportation, gathering, and processing equipment and other property and included in the table above, much of which is leased to third party operators for treating gas at the wellhead. The leases generally have a term of three years or less. The equipment under leases in place as of March 31, 2014 had a net carrying value of $11.6 million, and the terms of such leases provide for future lease payments to the Company extending up to August 2016. As of March 31, 2014, primarily all the leases to third parties were non-cancelable, with future minimum aggregate base rentals payable to the Company of $3.3 million over the twelve months ending March 31, 2015 and $1.1 million, in the aggregate, thereafter. |
INTANGIBLE_ASSETS_Notes
INTANGIBLE ASSETS (Notes) | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | ' | ||||||||
Intangible Assets | ' | ||||||||
NOTE 5 - INTANGIBLE ASSETS | |||||||||
Intangible assets consist primarily of gas gathering and processing contracts and customer relationships. The following table summarizes the Company's net intangible assets as of: | |||||||||
March 31, | December 31, | ||||||||
2014 | 2013 | ||||||||
(in thousands) | |||||||||
Customer relationships | $ | 5,434 | $ | 5,434 | |||||
Trademark | 859 | 859 | |||||||
Existing contracts | 4,199 | 4,199 | |||||||
Total intangible assets | 10,492 | 10,492 | |||||||
Less accumulated amortization | (4,463 | ) | (3,962 | ) | |||||
Intangible assets, net of accumulated amortization | $ | 6,029 | $ | 6,530 | |||||
INVENTORY_Notes
INVENTORY (Notes) | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Inventory Disclosure [Abstract] | ' | ||||||||
Inventory | ' | ||||||||
NOTE 6 - INVENTORY | |||||||||
The Company’s materials and supplies inventory is primarily comprised of frac sand used in the completion process of hydraulic fracturing. As of March 31, 2014 and December 31, 2013, the frac sand inventory is anticipated to be entirely used within the coming year, and is classified in current assets along with other inventory. | |||||||||
The following table shows the composition of the Company's inventory as of: | |||||||||
March 31, | December 31, | ||||||||
2014 | 2013 | ||||||||
(in thousands) | |||||||||
Materials and supplies | $ | 3,647 | $ | 6,790 | |||||
Commodities | 405 | 368 | |||||||
Inventory | $ | 4,052 | $ | 7,158 | |||||
ASSET_RETIREMENT_OBLIGATIONS
ASSET RETIREMENT OBLIGATIONS | 3 Months Ended | ||||||
Mar. 31, 2014 | |||||||
Asset Retirement Obligation Disclosure [Abstract] | ' | ||||||
ASSET RETIREMENT OBLIGATIONS | ' | ||||||
NOTE 7 - ASSET RETIREMENT OBLIGATIONS | |||||||
The following table summarizes the Company’s asset retirement obligation ("ARO") activities during the three-month period ended March 31, 2014 and for the year ended December 31, 2013: | |||||||
31-Mar-14 | 31-Dec-13 | ||||||
(in thousands) | |||||||
Asset retirement obligation at beginning of period | $ | 16,216 | $ | 30,680 | |||
Assumed in acquisitions | — | 17 | |||||
Liabilities incurred | 52 | 253 | |||||
Liabilities settled | (17 | ) | (98 | ) | |||
Liabilities sold | (12 | ) | (7,614 | ) | |||
Accretion expense | 368 | 2,264 | |||||
Revisions in estimated liabilities (1) | — | 1,935 | |||||
Reclassified as liabilities associated with assets held for sale | — | (11,148 | ) | ||||
Effect of foreign currency translation | — | (73 | ) | ||||
Asset retirement obligation at end of period | 16,607 | 16,216 | |||||
Less: current portion (included in other liabilities) | (61 | ) | (53 | ) | |||
Asset retirement obligation at end of period | $ | 16,546 | $ | 16,163 | |||
________________________________ | |||||||
(1) $1.5 million of the revisions in estimated liabilities is related to change in assumptions used with respect to certain wells in the Williston Basin in North Dakota during 2013. |
FAIR_VALUE_OF_FINANCIAL_INSTRU
FAIR VALUE OF FINANCIAL INSTRUMENTS | 3 Months Ended | ||||||||||||||||||
Mar. 31, 2014 | |||||||||||||||||||
Fair Value Disclosures [Abstract] | ' | ||||||||||||||||||
FAIR VALUE OF FINANCIAL INSTRUMENTS | ' | ||||||||||||||||||
NOTE 8 - FAIR VALUE OF FINANCIAL INSTRUMENTS | |||||||||||||||||||
Accounting standards define fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The standards also establish a framework for measuring fair value and a valuation hierarchy based upon the transparency of inputs used in the valuation of an asset or liability. Classification within the hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The valuation hierarchy contains three levels: | |||||||||||||||||||
• | Level 1 — Quoted prices (unadjusted) for identical assets or liabilities in active markets | ||||||||||||||||||
• | Level 2 — Quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; and model-derived valuations whose inputs or significant value drivers are observable | ||||||||||||||||||
• | Level 3 — Significant inputs to the valuation model are unobservable | ||||||||||||||||||
Transfers between Levels 1 and 2 occur at the end of the reporting period in which it is determined that the observability of significant inputs has increased or decreased. There were no transfers between levels of the fair value hierarchy during 2014 and 2013. In January 2014, the Company acquired common shares of NSE in partial consideration of an asset sale (See "Note 2 - Divestitures and Discontinued Operations"). The significant inputs used in valuing the NSE common shares, which have a quoted market price in an active market, were designated as Level 1 as of March 31, 2014. | |||||||||||||||||||
The Company used the following fair value measurements for certain of the Company's assets and liabilities at March 31, 2014 and December 31, 2013: | |||||||||||||||||||
Level 1 Classification: | |||||||||||||||||||
Available for Sale Securities | |||||||||||||||||||
At March 31, 2014 and December 31, 2013, the Company held common and preferred stock of publicly traded companies with quoted prices in an active market. Accordingly, the fair market value measurements of these securities have been classified as Level 1. | |||||||||||||||||||
Level 2 Classification: | |||||||||||||||||||
Commodity Derivative Instruments | |||||||||||||||||||
The Company does not designate its derivative instruments as hedges and therefore does not apply hedge accounting. The estimated fair value amounts of the Company’s commodity derivative instruments have been determined at discrete points in time based on relevant market information which resulted in the Company classifying such derivatives as Level 2. Although the Company’s commodity derivative instruments are valued using public indices, the instruments themselves are traded with unrelated counterparties and are not openly traded on an exchange. Although the Company is exposed to credit risk to the extent of nonperformance by the counterparties to these derivative contracts, the Company does not anticipate such nonperformance and monitors the credit worthiness of its counterparties on an ongoing basis. See "Note 9 - Financial Instruments and Derivatives". | |||||||||||||||||||
Level 3 Classification: | |||||||||||||||||||
Preferred Stock Embedded Derivative | |||||||||||||||||||
At March 31, 2014 and December 31, 2013, the Company had preferred stock embedded derivative liabilities resulting from certain conversion features, redemption options, and other features of its Eureka Hunter Holdings Series A Preferred Units. See "Note 13 - Redeemable Preferred Stock". | |||||||||||||||||||
The fair value of the bifurcated conversion feature was valued using the “with and without” analysis in a simulation model. The key assumptions used in the model to determine fair value at March 31, 2014 were a volatility of 25%, credit spread of 12.9%, and a total enterprise value of Eureka Hunter Holdings of $578.0 million. | |||||||||||||||||||
The fair value calculation is sensitive to movements in volatility and the total enterprise value of Eureka Hunter Holdings. As the implied volatility of the instruments increases so too does the fair value of the derivative liability arising from the conversion and redemption features. Similarly, as the total enterprise value of Eureka Hunter Holdings increases, the fair value of the derivative liability increases. Decreases in volatility and total enterprise value would result in a reduction to the fair value of the derivative liability associated with these instruments. | |||||||||||||||||||
Convertible Security Embedded Derivative | |||||||||||||||||||
The Company recognized an embedded derivative asset resulting from the fair value of the bifurcated conversion feature associated with the convertible note it received in February 2012 as partial consideration upon the sale of Hunter Disposal, LLC (“Hunter Disposal”) to GreenHunter Resources, Inc. ("GreenHunter"), a related party. The embedded derivative was valued using a Black-Scholes model valuation of the conversion option. | |||||||||||||||||||
The key inputs used in the Black-Scholes option pricing model were as follows: | |||||||||||||||||||
31-Mar-14 | |||||||||||||||||||
Life | 2.9 years | ||||||||||||||||||
Risk-free interest rate | 0.96 | % | |||||||||||||||||
Estimated volatility | 40 | % | |||||||||||||||||
Dividend | — | ||||||||||||||||||
GreenHunter stock price at end of period | $ | 0.96 | |||||||||||||||||
The sensitivity of the estimate of volatility used in determining the fair value of the convertible security embedded derivative would not have a significant impact to the Company's financial statements based on the value of the assets as compared to the financial statements as a whole. | |||||||||||||||||||
The following tables present the fair value hierarchy levels of the Company's financial assets and liabilities which are measured and carried at fair value on a recurring basis: | |||||||||||||||||||
Fair Value Measurements on a Recurring Basis | |||||||||||||||||||
31-Mar-14 | |||||||||||||||||||
(in thousands) | |||||||||||||||||||
Assets | Level 1 | Level 2 | Level 3 | ||||||||||||||||
Available for sale securities | $ | 11,210 | $ | — | $ | — | |||||||||||||
Commodity derivative assets | — | 585 | — | ||||||||||||||||
Convertible security derivative assets | — | — | 35 | ||||||||||||||||
Total assets at fair value | $ | 11,210 | $ | 585 | $ | 35 | |||||||||||||
Liabilities | |||||||||||||||||||
Commodity derivative liabilities | $ | — | $ | 5,571 | $ | — | |||||||||||||
Convertible preferred stock derivative liabilities | — | — | 72,316 | ||||||||||||||||
Total liabilities at fair value | $ | — | $ | 5,571 | $ | 72,316 | |||||||||||||
Fair Value Measurements on a Recurring Basis | |||||||||||||||||||
31-Dec-13 | |||||||||||||||||||
(in thousands) | |||||||||||||||||||
Assets | Level 1 | Level 2 | Level 3 | ||||||||||||||||
Available for sale securities | $ | 1,819 | $ | — | $ | — | |||||||||||||
Commodity derivative assets | — | 554 | — | ||||||||||||||||
Convertible security derivative assets | — | — | 79 | ||||||||||||||||
Total assets at fair value | $ | 1,819 | $ | 554 | $ | 79 | |||||||||||||
Liabilities | |||||||||||||||||||
Commodity derivative liabilities | $ | — | $ | 2,279 | $ | — | |||||||||||||
Convertible preferred stock derivative liabilities | — | — | 75,934 | ||||||||||||||||
Total liabilities at fair value | $ | — | $ | 2,279 | $ | 75,934 | |||||||||||||
The following table presents a reconciliation of the financial derivative asset and liability measured at fair value using significant unobservable inputs (Level 3 inputs) for the three-month period ended March 31, 2014: | |||||||||||||||||||
Preferred Stock Embedded | Convertible Security Embedded | ||||||||||||||||||
Derivative Liability | Derivative Asset | ||||||||||||||||||
(in thousands) | |||||||||||||||||||
Fair value at December 31, 2013 | $ | (75,934 | ) | $ | 79 | ||||||||||||||
Issuance of redeemable preferred stock | (2,318 | ) | — | ||||||||||||||||
Decrease in fair value recognized in other income (expense) | 5,936 | (44 | ) | ||||||||||||||||
Fair value as of March 31, 2014 | $ | (72,316 | ) | $ | 35 | ||||||||||||||
Other Fair Value Measurements | |||||||||||||||||||
The following table presents the carrying amounts and fair value categorized by fair value hierarchy level of the Company's financial instruments not carried at fair value: | |||||||||||||||||||
31-Mar-14 | 31-Dec-13 | ||||||||||||||||||
Fair Value Hierarchy | Carrying Amount | Estimated Fair Value | Carrying Amount | Estimated Fair Value | |||||||||||||||
(in thousands) | |||||||||||||||||||
Senior Notes | Level 2 | $ | 597,251 | $ | 666,000 | $ | 597,230 | $ | 651,300 | ||||||||||
MHR Senior Revolving Credit Facility | Level 3 | $ | 226,000 | $ | 226,000 | $ | 218,000 | $ | 218,000 | ||||||||||
Eureka Hunter Pipeline second lien term loan | Level 3 | $ | — | $ | — | $ | 50,000 | $ | 58,921 | ||||||||||
Eureka Hunter Pipeline Credit Agreement | Level 3 | $ | 55,000 | $ | 55,000 | $ | — | $ | — | ||||||||||
Equipment notes payable | Level 3 | $ | 25,609 | $ | 25,659 | $ | 18,615 | $ | 17,676 | ||||||||||
The fair value of the Company's Senior Notes is based on quoted market prices available for Magnum Hunter's Senior Notes. The fair value hierarchy for the Company's Senior Notes is Level 2 (quoted prices for similar assets in active markets). | |||||||||||||||||||
The carrying value of the Company's senior revolving credit facility (the “MHR Senior Revolving Credit Facility") approximates fair value as it is subject to short-term floating interest rates that approximate the rates available to the Company for those periods. The fair value hierarchy for the MHR Senior Revolving Credit Facility is Level 3. | |||||||||||||||||||
The fair value of the Eureka Hunter Pipeline Credit Agreement outstanding as of March 31, 2014 approximates the carrying value as the agreement was entered into on March 28, 2014. The fair value of Eureka Hunter Pipeline's second lien term loan as of December 31, 2013 is the estimated cost to acquire the debt, including a credit spread for the difference between the issue rate and the period end market rate. The credit spread is the Company’s default or repayment risk. The credit spread (premium or discount) is determined by comparing the Company’s fixed-rate notes and credit facility to new issuances (secured and unsecured) and secondary trades of similar size and credit statistics for both public and private debt. | |||||||||||||||||||
The fair value of all fixed-rate notes and the credit facility is based on interest rates currently available to the Company. | |||||||||||||||||||
Fair Value on a Non-Recurring Basis | |||||||||||||||||||
The Company follows the provisions of ASC Topic 820, Fair Value Measurement, for non-financial assets and liabilities measured at fair value on a non-recurring basis. As it relates to the Company, ASC Topic 820 applies to certain non-financial assets and liabilities as may be acquired in a business combination and thereby measured at fair value; measurements of impairments, and the initial recognition of asset retirement obligations, for which fair value is used. These ARO estimates are derived from historical costs as well as management's expectation of future cost environments. As there is no corroborating market activity to support the assumptions used, the Company has designated these measurements as Level 3. |
FINANCIAL_INSTRUMENTS_AND_DERI
FINANCIAL INSTRUMENTS AND DERIVATIVES | 3 Months Ended | ||||||||||||||||||
Mar. 31, 2014 | |||||||||||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ' | ||||||||||||||||||
FINANCIAL INSTRUMENTS AND DERIVATIVES | ' | ||||||||||||||||||
NOTE 9 - FINANCIAL INSTRUMENTS AND DERIVATIVES | |||||||||||||||||||
Investment Holdings | |||||||||||||||||||
Below is a summary of changes in investments for the period ended March 31, 2014: | |||||||||||||||||||
Available for Sale Securities (1) | Equity Method Investments (2) | ||||||||||||||||||
(in thousands) | |||||||||||||||||||
Carrying value as of December 31, 2013 | $ | 1,819 | $ | 940 | |||||||||||||||
Securities received as consideration for assets sold | 9,447 | — | |||||||||||||||||
Equity in net loss recognized in other income (expense) | — | (246 | ) | ||||||||||||||||
Change in fair value recognized in other comprehensive loss | (56 | ) | — | ||||||||||||||||
Carrying value as of March 31, 2014 | $ | 11,210 | $ | 694 | |||||||||||||||
-1 | Available for sale securities includes $142,000 that has been classified as held for sale associated with the classification of the MHP subsidiary. | ||||||||||||||||||
(2) Equity method investments includes $326,000 classified as long-term other assets. | |||||||||||||||||||
The Company's investments have been presented in the consolidated balance sheet as of March 31, 2014 as follows: | |||||||||||||||||||
Available for Sale Securities | Equity Method Investments | Total | |||||||||||||||||
Investments - Current | $ | 11,068 | $ | 368 | $ | 11,436 | |||||||||||||
Investments - Long-Term | — | 326 | 326 | ||||||||||||||||
Investments - Held for Sale | 142 | — | 142 | ||||||||||||||||
Carrying value as of March 31,2014 | $ | 11,210 | $ | 694 | $ | 11,904 | |||||||||||||
The cost for equity securities and their respective fair values as of March 31, 2014 and December 31, 2013 are as follows: | |||||||||||||||||||
March 31, 2014 | |||||||||||||||||||
(in thousands) | |||||||||||||||||||
Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | ||||||||||||||||
Securities available for sale, carried at fair value: | |||||||||||||||||||
Equity securities | $ | 9,875 | $ | — | $ | (324 | ) | $ | 9,551 | ||||||||||
Equity securities - related party (see "Note 15 - Related Parties) | 2,200 | — | (541 | ) | 1,659 | ||||||||||||||
Total Securities available for sale | $ | 12,075 | $ | — | $ | (865 | ) | $ | 11,210 | ||||||||||
December 31, 2013 | |||||||||||||||||||
(in thousands) | |||||||||||||||||||
Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | ||||||||||||||||
Securities available for sale, carried at fair value: | |||||||||||||||||||
Equity securities | $ | 428 | $ | — | $ | (281 | ) | $ | 147 | ||||||||||
Equity securities - related party (see "Note 15 - Related Party Transactions") | 2,200 | — | (528 | ) | 1,672 | ||||||||||||||
Total Securities available for sale | $ | 2,628 | $ | — | $ | (809 | ) | $ | 1,819 | ||||||||||
The methods of determining the fair values of Magnum Hunter's investments in equity securities are described in "Note 8 - Fair Value of Financial Instruments". | |||||||||||||||||||
The Company's investment holdings are concentrated in three issuers whose business activities are related to the oil and natural gas industry. These investments are ancillary to the Company's overall operating strategy and such concentrations of risk related to investment holdings do not pose a substantial risk to the Company's operational performance. The Company evaluates factors that it believes could influence the fair value of the issuers' securities such as management, assets, earnings, cash generation, and capital needs. | |||||||||||||||||||
The fair values of equity securities fluctuate based upon changes in market prices. Gross unrealized losses on investments are considered for other-than-temporary impairment when such losses have persisted for more than a 12-month period. However, security specific circumstances may arise where an investment is considered impaired when gross unrealized losses have been observed for less than twelve months. As of March 31, 2014 and December 31, 2013, the Company did not hold any equity securities which were in a gross unrealized loss position for greater than a year, and no impairments were recognized for the periods then ended. | |||||||||||||||||||
Commodity and Financial Derivative Instruments | |||||||||||||||||||
The Company periodically enters into certain commodity derivative instruments such as futures contracts, swaps, collars, and basis swap contracts, to mitigate commodity price risk associated with a portion of the Company's future monthly natural gas and crude oil production and related cash flows. The Company has not designated any commodity derivative instruments as hedges. | |||||||||||||||||||
In a commodities swap agreement, the Company trades the fluctuating market prices of oil or natural gas at specific delivery points over a specified period, for fixed prices. As a producer of oil and natural gas, the Company holds these commodity derivatives to protect the operating revenues and cash flows related to a portion of its future natural gas and crude oil sales from the risk of significant declines in commodity prices, which is intended to help reduce exposure to price risk and improve the likelihood of funding its capital budget. If the price of a commodity rises above what the Company has agreed to receive in the swap agreement, the amount that it agrees to pay the counterparty would theoretically be offset by the increased amount it received for its production. | |||||||||||||||||||
As of March 31, 2014, the Company had the following commodity derivative instruments: | |||||||||||||||||||
Weighted Average | |||||||||||||||||||
Natural Gas | Period | MMBtu/day | Price per MMBtu | ||||||||||||||||
Collars (1) | April 2014- Dec 2014 | 5,000 | $4.00 - $5.25 | ||||||||||||||||
Swaps | April 2014 - Dec 2014 | 31,000 | $4.23 | ||||||||||||||||
Jan 2015 - Dec 2015 | 20,000 | $4.18 | |||||||||||||||||
Ceilings purchased (call) | April 2014 - Dec 2014 | 16,000 | $5.91 | ||||||||||||||||
Ceilings sold (call) | April 2014 - Dec 2014 | 16,000 | $5.91 | ||||||||||||||||
Weighted Average | |||||||||||||||||||
Crude Oil | Period | Bbl/day | Price per Bbl | ||||||||||||||||
Collars (1) | April 2014 - Dec 2014 | 663 | $85.00 - $91.25 | ||||||||||||||||
Jan 2015 - Dec 2015 | 259 | $85.00 - $91.25 | |||||||||||||||||
Traditional three-way collars (2) | April 2014 - Dec 2014 | 4,000 | $64.94 - $85.00 - $102.50 | ||||||||||||||||
Ceilings sold (call) | Jan 2015 - Dec 2015 | 1,570 | $120.00 | ||||||||||||||||
Floors sold (put) | April 2014 - Dec 2014 | 663 | $65.00 | ||||||||||||||||
Jan 2015 - Dec 2015 | 259 | $70.00 | |||||||||||||||||
________________________________ | |||||||||||||||||||
(1) A collar is a sold call and a purchased put. Some collars are "costless" collars with the premiums netting to approximately zero. | |||||||||||||||||||
(2) These three-way collars are a combination of three options: a sold call, a purchased put and a sold put. | |||||||||||||||||||
Currently, Bank of America, Bank of Montreal, KeyBank National Association, Credit Suisse Energy, LLC, Citibank, N.A., ABN AMRO, the Royal Bank of Canada, and J. Aron & Company are the only counterparties to the Company's commodity derivatives positions. The Company is exposed to credit losses in the event of nonperformance by the counterparties; however, it does not anticipate nonperformance by the counterparties over the term of the commodity derivatives positions. All counterparties, or their affiliates, are participants in the MHR Senior Revolving Credit Facility, and the collateral for the outstanding borrowings under the MHR Senior Revolving Credit Facility is used as collateral for its commodity derivatives with those counterparties. | |||||||||||||||||||
At March 31, 2014, the Company had preferred stock derivative liabilities resulting from certain conversion features, redemption options, and other features of its Eureka Hunter Holdings Series A Preferred Units. See "Note 8 - Fair Value of Financial Instruments" and "Note 13 - Redeemable Preferred Stock". | |||||||||||||||||||
At March 31, 2014, the Company also had a convertible security embedded derivative asset primarily due to the conversion feature of the promissory note received as partial consideration for the sale of Hunter Disposal. See "Note 8 - Fair Value of Financial Instruments," "Note 2 - Divestitures and Discontinued Operations," and "Note 15 - Related Party Transactions". | |||||||||||||||||||
The following table summarizes the fair value of the Company's commodity and financial derivative contracts as of the dates indicated: | |||||||||||||||||||
Derivative Assets | Derivative Liabilities | ||||||||||||||||||
Derivatives not designated as hedging instruments | Balance Sheet Classification | March 31, 2014 | December 31, 2013 | March 31, 2014 | December 31, 2013 | ||||||||||||||
(in thousands) | |||||||||||||||||||
Commodity | |||||||||||||||||||
Derivative assets | $ | — | $ | 529 | $ | — | $ | — | |||||||||||
Derivative assets - long-term | 585 | 25 | — | — | |||||||||||||||
Derivative liabilities | — | — | (5,276 | ) | (1,903 | ) | |||||||||||||
Derivative liabilities - long-term | — | — | (295 | ) | (376 | ) | |||||||||||||
Total commodity | $ | 585 | $ | 554 | $ | (5,571 | ) | $ | (2,279 | ) | |||||||||
Financial | |||||||||||||||||||
Derivative assets | $ | 35 | $ | 79 | $ | — | $ | — | |||||||||||
Derivative liabilities - long-term | — | — | (72,316 | ) | (75,934 | ) | |||||||||||||
Total financial | $ | 35 | $ | 79 | $ | (72,316 | ) | $ | (75,934 | ) | |||||||||
Total derivatives | $ | 620 | $ | 633 | $ | (77,887 | ) | $ | (78,213 | ) | |||||||||
Certain of the Company's derivative instruments are subject to enforceable master netting arrangements that provide for the net settlement of all derivative contracts between the Company and a counterparty in the event of default or upon the occurrence of certain termination events. The tables below summarize the Company's commodity derivatives and the effect of master netting arrangements on the presentation in the Company's consolidated balance sheets as of: | |||||||||||||||||||
March 31, 2014 | |||||||||||||||||||
Gross Amounts of Recognized Assets and Liabilities | Gross Amounts Offset on the Consolidated Balance Sheet | Net Amount | |||||||||||||||||
(in thousands) | |||||||||||||||||||
Current assets: Fair value of derivative contracts | $ | 1,561 | 1,561 | $ | — | ||||||||||||||
Long-term assets: Fair value of derivative contracts | 928 | 343 | 585 | ||||||||||||||||
Current liabilities: Fair value of derivative contracts | (6,837 | ) | (1,561 | ) | (5,276 | ) | |||||||||||||
Long-term liabilities: Fair value of derivative contracts | (638 | ) | (343 | ) | (295 | ) | |||||||||||||
$ | (4,986 | ) | — | $ | (4,986 | ) | |||||||||||||
December 31, 2013 | |||||||||||||||||||
Gross Amounts of Assets and Liabilities | Gross Amounts Offset on the Consolidated Balance Sheet | Net Amount | |||||||||||||||||
(in thousands) | |||||||||||||||||||
Current assets: Fair value of derivative contracts | $ | 4,034 | 3,505 | $ | 529 | ||||||||||||||
Long-term assets: Fair value of derivative contracts | 516 | 491 | 25 | ||||||||||||||||
Current liabilities: Fair value of derivative contracts | (5,408 | ) | (3,505 | ) | (1,903 | ) | |||||||||||||
Long-term liabilities: Fair value of derivative contracts | (867 | ) | (491 | ) | (376 | ) | |||||||||||||
$ | (1,725 | ) | — | $ | (1,725 | ) | |||||||||||||
The following table summarizes the net gain (loss) on all derivative contracts included in other income (expense) on the consolidated statements of operations for the three months ended March 31, 2014 and 2013: | |||||||||||||||||||
Three Months Ended March 31, | |||||||||||||||||||
2014 | 2013 | ||||||||||||||||||
(in thousands) | |||||||||||||||||||
Gain (loss) on settled transactions | $ | (2,284 | ) | $ | 956 | ||||||||||||||
Gain (loss) on open transactions | 2,631 | (8,447 | ) | ||||||||||||||||
Total gain (loss) | $ | 347 | $ | (7,491 | ) | ||||||||||||||
LONGTERM_DEBT
LONG-TERM DEBT | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Debt Disclosure [Abstract] | ' | |||||||
LONG-TERM DEBT | ' | |||||||
NOTE 10 - DEBT | ||||||||
Long-term debt at March 31, 2014 and December 31, 2013 consisted of the following: | ||||||||
March 31, 2014 | December 31, 2013 | |||||||
(in thousands) | ||||||||
Senior Notes payable due May 15, 2020, interest rate of 9.75%, net of unamortized net discount of $2.8 million at March 31, 2014 and December 31, 2013 | $ | 597,251 | $ | 597,230 | ||||
Various equipment and real estate notes payable with maturity dates January 2015 - April 2021, interest rates of 4.25% - 7.94%(1) | 25,609 | 18,615 | ||||||
Eureka Hunter Pipeline Credit Agreement due March 28, 2018, interest rate of 5.75% | 55,000 | — | ||||||
Eureka Hunter Pipeline second lien term loan due August 16, 2018, interest rate of 12.5% | — | 50,000 | ||||||
MHR Senior Revolving Credit Facility due April 13, 2016, interest rate of 2.96% | 226,000 | 218,000 | ||||||
at March 31, 2014 and 3.56% at December 31, 2013 | ||||||||
903,860 | 883,845 | |||||||
Less: current portion | (9,986 | ) | (3,967 | ) | ||||
Total long-term debt obligations, net of current portion | $ | 893,874 | $ | 879,878 | ||||
_________________________________ | ||||||||
(1) | Includes notes classified as liabilities associated with assets held for sale of which $4.6 million is current and $2.3 million is long-term at March 31, 2014, and $0.2 million is current and $3.8 million is long-term at December 31, 2013. | |||||||
The following table presents the scheduled or expected approximate annual maturities of debt, gross of unamortized discount of $2.8 million: | ||||||||
(in thousands) | ||||||||
2014 | $ | 4,354 | ||||||
2015 | 9,989 | |||||||
2016 | 234,548 | |||||||
2017 | 2,358 | |||||||
2018 | 55,360 | |||||||
Thereafter | 600,000 | |||||||
Total | $ | 906,609 | ||||||
MHR Senior Revolving Credit Facility | ||||||||
On December 13, 2013, the Company entered into a Third Amended and Restated Credit Agreement (the “Credit Agreement”) by and among the Company, Bank of Montreal, as Administrative Agent, the lenders party thereto and the agents party thereto. The Credit Agreement amended and restated that certain Second Amended and Restated Credit Agreement, dated as of April 13, 2011, by and among such parties, as amended (the "Prior Credit Agreement"). The terms of the Credit Agreement are substantially similar to the Prior Credit Agreement. | ||||||||
As of March 31, 2014, the borrowing base under this facility was $232.5 million, and $226.0 million of borrowings were outstanding ($218.0 million outstanding as of December 31, 2013). On May 6, 2014, the Company entered into an amendment to the Credit Agreement and the borrowing base was increased to $325.0 million. See "Note 20 - Subsequent Events". The borrowing base is subject to certain automatic reductions upon the issuance of additional Senior Notes and in certain other circumstances. | ||||||||
At March 31, 2014, the Company was in compliance with all of its covenants, as amended, contained in the MHR Senior Revolving Credit Facility. | ||||||||
Eureka Hunter Pipeline Credit Agreement | ||||||||
On March 28, 2014, Eureka Hunter Pipeline entered into a credit agreement (the “Eureka Hunter Pipeline Credit Agreement”), by and among Eureka Hunter Pipeline, as borrower, ABN AMRO Capital USA, LLC, as a lender and as administrative agent, and the other lenders party thereto. | ||||||||
The credit agreement, which has a maturity date of March 28, 2018, provides for a revolving credit facility in an aggregate principal amount of up to $117.0 million (with the potential to increase the aggregate commitment under the credit agreement to an aggregate principal amount of up to $150.0 million, subject to the consent of the lender parties and the satisfaction of certain conditions), secured by a first lien on substantially all of the assets of Eureka Hunter Pipeline and its subsidiaries, which include TransTex Hunter, LLC, as well as by Eureka Hunter Pipeline’s pledge of the equity in its subsidiaries. The subsidiaries of Eureka Hunter Pipeline also guarantee Eureka Hunter Pipeline’s obligations under the credit agreement. The credit agreement is non-recourse to Magnum Hunter. The Company incurred deferred financing costs directly associated with entering into the Eureka Hunter Pipeline Credit Agreement in the amount of $1.2 million which will be amortized straight-line over the term of the revolving credit facility. The straight-line method of amortization results in substantially the same periodic amortization as the effective interest method. | ||||||||
The terms of the credit agreement provide that the borrowings thereunder may be used, among other specified purposes, (1) to refinance existing indebtedness of Eureka Hunter Pipeline outstanding on the credit agreement closing date, including the term loan of $50.0 million in principal amount owed under the Second Lien Term Loan Agreement, dated August 16, 2011, by and among Eureka Hunter Pipeline and Pennant Park Investment Corporation, as a lender, the other lenders party thereto and U.S. Bank National Association, as collateral agent, (2) to finance future expansion activities related to Eureka Hunter Pipeline’s gathering system in West Virginia and Ohio, (3) to finance acquisitions by Eureka Hunter Pipeline and its subsidiaries permitted under the terms of the credit agreement, (4) to refinance from time to time certain letters of credit of Eureka Hunter Pipeline and its subsidiaries, (5) to provide working capital for their operations, and (6) for their other general business purposes. | ||||||||
The Eureka Hunter Pipeline Credit Agreement provides for a commitment fee based on the unused portion of the commitment under the credit agreement of 0.50% per annum when the consolidated leverage ratio is greater than or equal to 3.0 to 1.0 and a commitment fee of 0.375% when the consolidated leverage ratio is less than 3.0 to 1.0. | ||||||||
In general terms, borrowings under the credit agreement will, at Eureka Hunter Pipeline’s election, bear interest: | ||||||||
• | on base rate loans, at the per annum rate equal to the sum of (A) the base rate (defined as the highest of (i) the per annum rate of interest established by JPMorgan Chase Bank, N.A. as its prime rate for U.S. dollar loans, (ii) the Adjusted Eurodollar Rate (as defined in the Credit Agreement) for an interest period of one-month, plus 1.0%, or (iii) the federal funds rate, plus 0.50% per annum), and (B) a margin of 1.0% to 2.50% per annum; or | |||||||
• | on Eurodollar Loans, at the per annum rate equal to the sum of (A) the Eurodollar Rate (as defined in the Credit Agreement) adjusted for certain statutory reserve requirements for Eurocurrency liabilities, and (B) a margin of 2.0% to 3.50% per annum. | |||||||
If an event of default occurs under the credit agreement, generally, the applicable lenders may increase the interest rate then in effect by an additional 2.0% per annum for the period that the default exists. | ||||||||
The credit agreement contains customary affirmative covenants and negative covenants that, among other things, restrict the ability of each of Eureka Hunter Pipeline and its subsidiaries to, with certain exceptions: (1) incur indebtedness; (2) grant liens; (3) enter into hedging transactions; (4) enter into a merger or consolidation or sell, lease, transfer or otherwise dispose of all or substantially all of its assets or the stock of any of its subsidiaries; (5) issue equity; (6) dispose of any material assets or properties; (7) pay or declare dividends or make certain distributions; (8) invest in, extend credit to or make advances or loans to any person or entity; (9) engage in material transactions with any affiliate; (10) enter into any agreement that restricts or imposes any condition upon the ability of (a) any of Eureka Hunter Pipeline or its subsidiaries to create, incur or permit any lien upon any of its assets or properties, or (b) any such subsidiary to pay dividends or other distributions, to make or repay loans or advances, to guarantee indebtedness or to transfer any of its property or assets to Eureka Hunter Pipeline or its subsidiaries; (11) change the nature of its business; (12) amend its organizational documents or material agreements; (13) change its fiscal year; (14) enter into sale and leaseback transactions; (15) make acquisitions; (16) make certain capital expenditures; or (17) take any action that could result in regulation as a utility. | ||||||||
The credit agreement requires Eureka Hunter Pipeline to satisfy certain financial covenants, including maintaining: | ||||||||
• | a maximum leverage ratio (defined as the ratio of (i) consolidated funded debt to (ii) annualized consolidated EBITDA), as of the end of each fiscal quarter, not greater than (A) 4.75 to 1.00 for the fiscal quarters ending March 31, 2014 through September 30, 2014, and (B) 4.50 to 1.00 for the fiscal quarter ending December 31, 2014 and each fiscal quarter ending thereafter; and | |||||||
• | a minimum interest coverage ratio (defined as the ratio of (i) annualized consolidated EBITDA to (ii) annualized consolidated interest charges for such period), as of the end of each fiscal quarter, not less than (A) 2.75to 1.00 for the fiscal quarters ending March 31, 2014 through September 30, 2014, and (B) 2.50 to 1.00 for the fiscal quarter ending December 31, 2014 and each fiscal quarter ending thereafter. | |||||||
The obligations of Eureka Hunter Pipeline under the credit agreement may be accelerated upon the occurrence of an event of default. Events of default include customary events for these types of financings, including, among other things, payment defaults, defaults in the performance of affirmative or negative covenants, the inaccuracy of representations or warranties, material defaults under or termination of certain material contracts, defaults relating to judgments, certain bankruptcy proceedings, a change in control and any material adverse change. | ||||||||
As of March 31, 2014 the maximum amount available under the credit agreement was $58.7 million, and the Company had $55.0 million in borrowings outstanding. The borrowing capacity is subject to certain upward or downward reductions during the term of the credit agreement. | ||||||||
As of March 31, 2014 the Company was in compliance with all of its covenants contained in the Eureka Hunter Pipeline Credit Agreement. | ||||||||
Eureka Hunter Pipeline Credit Facilities | ||||||||
Upon executing the new Eureka Hunter Pipeline Credit Agreement on March 28, 2014, Eureka Hunter Pipeline terminated its revolving credit agreement with SunTrust Bank and the term loan agreement with Pennant Park (the "Original Eureka Hunter Credit Facilities"). Eureka Hunter Pipeline used proceeds from the Eureka Hunter Pipeline Credit Agreement to pay in full all outstanding obligations related to the termination of those agreements, which included the principal outstanding amount of $50.0 million, a prepayment penalty of $2.2 million, and accrued, unpaid interest of $1.5 million. | ||||||||
Equipment Note Payable | ||||||||
On January 21, 2014, the Company's wholly owned subsidiary, Alpha Hunter Drilling, LLC entered into a master loan and security agreement with CIT Finance LLC to borrow $5.6 million at an interest rate of 7.94% over a term of forty-eight months. The note is collateralized by field equipment, and the Company is a guarantor on the note. | ||||||||
Interest Expense | ||||||||
The following table sets forth interest expense for the three-month period ended March 31, 2014 and 2013, respectively: | ||||||||
Three Months Ended | ||||||||
March 31, | ||||||||
2014 | 2013 | |||||||
(in thousands) | ||||||||
Interest expense incurred on debt, net of amounts capitalized | $ | 20,228 | $ | 17,844 | ||||
Amortization and write-off of deferred financing costs | 3,621 | 857 | ||||||
Total Interest Expense | $ | 23,849 | $ | 18,701 | ||||
The Company capitalizes interest on expenditures for significant construction projects that last more than six months while activities are in progress to bring the assets to their intended use. Interest of $610,000 and $848,000 was capitalized on our Eureka Hunter Gas Gathering System during the three months ended March 31, 2014 and 2013, respectively. | ||||||||
For the three-month period ended March 31, 2014, interest expense incurred on debt includes a $2.2 million prepayment penalty incurred by Eureka Hunter Pipeline as a result of its early termination of the Original Eureka Hunter Credit Facilities, which penalty represents an additional cost of borrowing for a period shorter than contractual maturity. In addition, amortization and write-off of deferred financing costs for the three-month period ended March 31, 2014 includes the write-off of $2.7 million in unamortized deferred financing costs related to those terminated agreements, which costs were expensed at the time of early extinguishment. |
SHAREBASED_COMPENSATION
SHARE-BASED COMPENSATION | 3 Months Ended | |||||||||||||
Mar. 31, 2014 | ||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ' | |||||||||||||
SHARE-BASED COMPENSATION | ' | |||||||||||||
NOTE 11 - SHARE-BASED COMPENSATION | ||||||||||||||
Under the Company's Amended and Restated Stock Incentive Plan, the Company may grant unrestricted common stock, restricted common stock, common stock options, and stock appreciation rights to directors, officers, employees and other persons who contribute to the success of Magnum Hunter. Currently, 27,500,000 shares of the Company's common stock are authorized to be issued under the plan, and 7,448,674 shares had been issued under the plan as of March 31, 2014. | ||||||||||||||
The Company recognized share-based compensation expense of $1.1 million for the three months ended March 31, 2014 and $6.3 million for the three months ended March 31, 2013. | ||||||||||||||
A summary of common stock option activity for the three months ended March 31, 2014 and 2013 is presented below: | ||||||||||||||
Three Months Ended March 31, | ||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||
(in thousands of shares) | Weighted Average Exercise Price per Share | |||||||||||||
Outstanding at beginning of period | 16,891 | 14,847 | $ | 5.69 | $ | 6.01 | ||||||||
Granted | — | 4,363 | $ | — | $ | 4.16 | ||||||||
Exercised | (597 | ) | — | $ | 6.67 | $ | — | |||||||
Forfeited | (902 | ) | (225 | ) | $ | 6.37 | $ | 7.37 | ||||||
Outstanding at end of period | 15,392 | 18,985 | $ | 5.61 | $ | 5.57 | ||||||||
Exercisable at end of period | 10,003 | 9,946 | $ | 5.74 | $ | 5.65 | ||||||||
A summary of the Company’s non-vested common stock options and stock appreciation rights for the three months ended March 31, 2014 and 2013 is presented below: | ||||||||||||||
Three Months Ended March 31, | ||||||||||||||
2014 | 2013 | |||||||||||||
(in thousands of shares) | ||||||||||||||
Non-vested at beginning of period | 6,908 | 6,163 | ||||||||||||
Granted | — | 4,363 | ||||||||||||
Vested | (805 | ) | (1,482 | ) | ||||||||||
Forfeited | (714 | ) | (6 | ) | ||||||||||
Non-vested at end of period | 5,389 | 9,038 | ||||||||||||
Total unrecognized compensation cost related to the non-vested common stock options was $7.9 million and $17.2 million as of March 31, 2014 and 2013, respectively. The unrecognized compensation cost at March 31, 2014 is expected to be recognized over a weighted-average period of 1.05 years. At March 31, 2014, the weighted average remaining contract life of outstanding options was 5.16 years. | ||||||||||||||
During the three months ended March 31, 2014, the Company granted 1,342,575 restricted shares of common stock to officers, executives, and employees of the Company which vest over a 3-year period with 33% of the restricted shares vesting one year from the date of the grant. The Company also granted 123,798 restricted shares to the directors of the Company which vest 100% one year from the date of the grant. The shares had a fair value at the time of grant of $10.7 million based on the stock price on grant date and estimated forfeiture rate of 3.4%. | ||||||||||||||
Total unrecognized compensation cost related to non-vested, restricted shares amounted to $9.3 million and $264,000 as of March 31, 2014 and 2013, respectively. The unrecognized cost at March 31, 2014, is expected to be recognized over a weighted-average period of 2.61 years. |
SHAREHOLDERS_EQUITY
SHAREHOLDERS’ EQUITY | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Equity [Abstract] | ' | |||||||
SHAREHOLDERS’ EQUITY | ' | |||||||
NOTE 12 - SHAREHOLDERS' EQUITY | ||||||||
Common Stock | ||||||||
During the three months ended March 31, 2014, the Company: | ||||||||
i) | issued 25,152 shares of the Company’s common stock in connection with share-based compensation which had fully vested to senior management and directors of the Company; | |||||||
ii) issued 597,000 shares of the Company’s common stock upon exercise of fully vested stock options. | ||||||||
iii) | issued 4,300,000 shares of the Company's common stock in a private placement at a price of $7.00 per share, with net proceeds to the Company of $28.9 million after deducting sales agent commissions and other issuance costs. The Company subsequently made an initial filing with the Securities and Exchange Commission (the "SEC") to register the resale of these shares by the holders of the issued common stock to satisfy the Company's registration obligations under the private placement. | |||||||
Preferred Dividends Incurred | ||||||||
A summary of the Company's preferred dividends for the three months ended March 31, 2014 and 2013 is presented below: | ||||||||
Three Months Ended March 31, | ||||||||
2014 | 2013 | |||||||
(in thousands) | ||||||||
Dividend on Eureka Hunter Holdings Series A Preferred Units | $ | 4,028 | $ | 3,114 | ||||
Accretion of the carrying value of the Eureka Hunter Holdings Series A Preferred Units | 2,048 | 1,468 | ||||||
Dividend on Series C Preferred Stock | 2,562 | 2,562 | ||||||
Dividend on Series D Preferred Stock | 4,424 | 4,382 | ||||||
Dividend on Series E Preferred Stock | 1,834 | 1,962 | ||||||
Total dividends on Preferred Stock | $ | 14,896 | $ | 13,488 | ||||
Net Income or Loss per Share Data | ||||||||
Basic income or loss per common share is computed by dividing the income or loss attributable to common shareholders by the weighted average number of shares of common stock outstanding during the period. Diluted income or loss per common share considers the impact to net income and common shares for the potential dilution from stock options, common stock purchase warrants and any outstanding convertible securities. | ||||||||
The Company has issued potentially dilutive instruments in the form of restricted common stock of Magnum Hunter granted and not yet issued, common stock warrants, common stock options granted to the Company's employees and directors, and the Company's Series E Preferred Stock. The Company did not include any of these instruments in its calculation of diluted loss per share during the periods presented, because to include them would be anti-dilutive due to the Company's loss from continuing operations during those periods. | ||||||||
The following table summarizes the types of potentially dilutive securities outstanding as of March 31, 2014 and 2013: | ||||||||
March 31, | ||||||||
2014 | 2013 | |||||||
(in thousands of shares) | ||||||||
Series E Preferred Stock | 10,946 | 10,946 | ||||||
Warrants | 17,071 | 13,376 | ||||||
Restricted shares granted, not yet issued | 1,453 | — | ||||||
Common stock options and stock appreciations rights | 15,392 | 18,985 | ||||||
Total | 44,862 | 43,307 | ||||||
REDEEMABLE_PREFERRED_STOCK
REDEEMABLE PREFERRED STOCK | 3 Months Ended |
Mar. 31, 2014 | |
Equity [Abstract] | ' |
REDEEMABLE PREFERRED STOCK | ' |
NOTE 13 - REDEEMABLE PREFERRED STOCK | |
Eureka Hunter Holdings Series A Preferred Units | |
On March 21, 2012, Eureka Hunter Holdings entered into a Series A Convertible Preferred Unit Purchase Agreement (the “Unit Purchase Agreement”) with Magnum Hunter and Ridgeline Midstream Holdings, LLC (“Ridgeline”), an affiliate of ArcLight Capital Partners, LLC ("ArcLight"). Pursuant to this Unit Purchase Agreement, Ridgeline committed, subject to certain conditions, to purchase up to $200.0 million of Eureka Hunter Holdings Series A Preferred Units, representing membership interests of Eureka Hunter Holdings, of which $191.8 million had been purchased as of March 31, 2014. See "Note 20 - Subsequent Events" for additional information. | |
During the three months ended March 31, 2014, Eureka Hunter Holdings issued 200,000 Eureka Hunter Holdings Series A Preferred Units to Ridgeline for net proceeds of $3.9 million, net of transaction costs. The Eureka Hunter Holdings Series A Preferred Units outstanding at March 31, 2014 represented 42.4% of the ownership of Eureka Hunter Holdings on a basis as converted to Class A Common Units of Eureka Hunter Holdings. | |
During the three months ended March 31, 2014, Eureka Hunter Holdings issued 97,492 Eureka Hunter Holdings Series A Preferred Units as payment of $1.9 million in distributions paid-in-kind to holders of the Series A Preferred Units. The fair value of the embedded derivative feature of the outstanding Eureka Hunter Holdings Series A Preferred Units was determined to be $72.3 million at March 31, 2014. | |
Dividend expense included accretion of the Eureka Hunter Holdings Series A Preferred Units of $2.0 million for the three months ended March 31, 2014, and $1.5 million for the three months ended March 31, 2013. |
TAXES
TAXES | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Income Tax Disclosure [Abstract] | ' | |||||||
Taxes | ' | |||||||
NOTE 14 - TAXES | ||||||||
The Company's income tax benefit from continuing operations for the three months ended March 31, 2014 and 2013 was: | ||||||||
Three Months Ended March 31, | ||||||||
2014 | 2013 | |||||||
(in thousands) | ||||||||
Deferred | — | 4,899 | ||||||
Income tax benefit | $ | — | $ | 4,899 | ||||
The Company recognizes deferred income taxes for the future tax consequences attributable to differences between the financial statement carrying amounts of the existing assets and liabilities and their respective tax basis and net operating loss and credit carryforwards. The Company maintains a full valuation allowance on deferred tax assets where the realization of those deferred tax assets is not more likely than not. The valuation allowance will continue to be recognized until the realization of future deferred tax benefits is more likely than not to be utilized. The Company files income tax returns in the United States, various states and Canada. As of March 31, 2014, no adjustments have been proposed by any tax jurisdiction that would have a significant impact on the Company's liquidity, future results of operations or financial position. |
RELATED_PARTY_TRANSACTIONS
RELATED PARTY TRANSACTIONS | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Related Party Transactions [Abstract] | ' | ||||||||
RELATED PARTY TRANSACTIONS | ' | ||||||||
NOTE 15 - RELATED PARTY TRANSACTIONS | |||||||||
The following table sets forth the related party balances as of March 31, 2014 and December 31, 2013: | |||||||||
March 31, 2014 | December 31, 2013 | ||||||||
(in thousands) | |||||||||
Green Hunter (1) | |||||||||
Accounts payable - net | $ | 451 | $ | 23 | |||||
Derivative assets (2) | $ | 35 | $ | 79 | |||||
Investments (2) | $ | 2,027 | $ | 2,262 | |||||
Notes receivable (2) | $ | 1,632 | $ | 1,768 | |||||
Prepaid expenses | $ | — | $ | 9 | |||||
The Company holds investments in related parties consisting of 1,846,722 shares of common stock of GreenHunter Resources with a carrying value of $367,984 as of March 31, 2014 and 88,000 shares of Series C preferred stock of GreenHunter Resources with a carrying value of $1.7 million as of March 31, 2014. | |||||||||
The following table sets forth the related party transaction activities for the three months ended March 31, 2014 and 2013, respectively: | |||||||||
Three Months Ended | |||||||||
March 31, | |||||||||
2014 | 2013 | ||||||||
(in thousands) | |||||||||
GreenHunter | |||||||||
Salt water disposal (1) | $ | 322 | $ | 856 | |||||
Equipment rental (1) | 122 | — | |||||||
Office space rental (1) | 22 | — | |||||||
Interest Income from Note Receivable (2) | 45 | 55 | |||||||
Dividends earned from Series C shares | 55 | — | |||||||
Loss on investments (2) | 235 | 526 | |||||||
Pilatus Hunter, LLC | |||||||||
Airplane rental expenses (3) | 70 | 47 | |||||||
_________________________________ | |||||||||
-1 | GreenHunter is an entity of which Gary C. Evans, the Company's Chairman and CEO, is the Chairman, a major shareholder and interim CEO; of which David Krueger, the Company's former Chief Accounting Officer and Senior Vice President, is the former Chief Financial Officer; and of which Ronald D. Ormand, the Company’s former Chief Financial Officer and Executive Vice President, is a former director. Eagle Ford Hunter received, and Triad Hunter and Viking International Resources, Inc., wholly-owned subsidiaries of the Company, receive services related to brine water and rental equipment from GreenHunter and its affiliated companies, White Top Oilfield Construction, LLC and Black Water Services, LLC. The Company believes that such services were and are provided at competitive market rates and were and are comparable to, or more attractive than, rates that could be obtained from unaffiliated third party suppliers of such services. | ||||||||
-2 | On February 17, 2012, the Company sold its wholly-owned subsidiary, Hunter Disposal, to GreenHunter Water, LLC ("GreenHunter Water"), a wholly-owned subsidiary of GreenHunter. The Company recognized an embedded derivative asset resulting from the conversion option under the convertible promissory note it received as partial consideration for the sale. See "Note 8 - Fair Value of Financial Instruments" for additional information. The Company has recorded interest income as a result of the note receivable from GreenHunter. Also as a result of this transaction, the Company has an equity method investment in GreenHunter that is included in derivatives and other long-term assets and an available for sale investment in GreenHunter included in investments. | ||||||||
-3 | The Company rented an airplane for business use for certain members of Company management at various times from Pilatus Hunter, LLC, an entity 100% owned by Mr. Evans. Airplane rental expenses are recorded in general and administrative expense. | ||||||||
In connection with the sale of Hunter Disposal, Triad Hunter entered into agreements with Hunter Disposal and GreenHunter Water for wastewater hauling and disposal capacity in Kentucky, Ohio, and West Virginia and a five-year tank rental agreement with GreenHunter Water. | |||||||||
Mr. Evans, the Company's Chairman and Chief Executive Officer, holds 27,641 Class A Common Units of Eureka Hunter Holdings. |
COMMITMENTS_AND_CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 3 Months Ended |
Mar. 31, 2014 | |
Commitments and Contingencies Disclosure [Abstract] | ' |
COMMITMENTS AND CONTINGENCIES | ' |
NOTE 16 - COMMITMENTS AND CONTINGENCIES | |
Agreement to Purchase Utica Shale Acreage | |
On August 12, 2013, Triad Hunter entered into an asset purchase agreement, with MNW Energy, LLC ("MNW"). MNW is an Ohio limited liability company that represents an informal association of various land owners, lessees and sub-lessees of mineral acreage who own or have rights in mineral acreage located in Monroe, Noble and/or Washington Counties, Ohio. Pursuant to the purchase agreement, Triad Hunter has agreed to acquire from MNW up to 32,000 net mineral acres, including currently leased and subleased acreage, located in such counties, over a period of time, in staggered closings, subject to certain conditions. On December 30, 2013, a lawsuit was filed against the Company, Triad Hunter, MNW and others asserting certain claims relating to the acreage covered by the asset purchase agreement with MNW. As a result of the litigation, no purchases were made during the three months ended March 31, 2014. | |
Settlement Agreement with Seminole Energy Services | |
On January 10, 2014, the company and certain of its subsidiaries entered into an Omnibus Settlement Agreement and Release (the "Settlement Agreement") dated January 9, 2014 with Seminole Energy Services, LLC and certain of its affiliates (collectively, "Seminole"). In connection with and pursuant to the terms of the Settlement Agreement, the Company and Seminole have agreed to release and discharge each other from all claims and causes of action alleged in, arising from or related to certain legal proceedings and to terminate, amend and enter into certain new, related agreements effective immediately prior to year-end on December 31, 2013 (the "New Agreements"). | |
By entering into the New Agreements, the Company and Seminole have restructured their existing agreements. The Company obtained a reduction in gas gathering rates it pays for natural gas owned or controlled by the Company that is gathered on the Stone Mountain Gathering System. The Company and Seminole collectively agreed to construct an enhancement of the Rogersville Plant designed to recover less ethane and more propane from the natural gas processed at the Rogersville Plant and reduce and extend the Company's contractual horizontal well drilling obligations owed to Seminole. The Company and Seminole have also agreed to modify the natural gas processing rates the Company will pay for processing at the Rogersville Plant, the Company's allocation of natural gas liquids ("NGL") recovered from gas processed and the costs of blend stock necessary to blend with the NGL produced from the Rogersville Plant, and certain deductions to the NGL purchase price the Company will pay Seminole for the Company's NGL produced from the Rogersville Plant. Seminole sold to the Company Seminole's 50% interest in a natural gas gathering trunk line and treatment facility located in southwestern Muhlenberg County, Kentucky, which had previously been owned equally by Seminole and the Company. | |
As a result of the restructuring effected by the Settlement Agreement, the Company expects to realize operational savings, certain components of which savings would occur over time, depending on the implementation timing or completion of certain of the benefits provided to the Company. | |
Legal Proceedings | |
Securities Cases | |
On April 23, 2013, Anthony Rosian, individually and on behalf of all other persons similarly situated, filed a class action complaint in the United States District Court, Southern District of New York, against the Company and certain of its officers, two of whom, at that time, also served as directors, and one of whom continues to serve as a director. On April 24, 2013, Horace Carvalho, individually and on behalf of all other persons similarly situated, filed a similar class action complaint in the United States District Court, Southern District of Texas, against the Company and certain of its officers. Several substantially similar putative class actions have been filed in the Southern District of New York and in the Southern District of Texas. All such cases are collectively referred to as the Securities Cases. The cases filed in the Southern District of Texas have since been dismissed, but the cases in the Southern District of New York have been consolidated and remain ongoing. The plaintiffs in the Securities Cases have filed a consolidated amended complaint alleging that the Company made certain false or misleading statements in its filings with the SEC, including statements related to the Company's internal and financial controls, the calculation of non-cash share-based compensation expense, the late filing of the Company's 2012 Form 10-K, the dismissal of Magnum Hunter's previous independent registered accounting firm, the Company’s characterization of the auditors’ position with respect to the dismissal, and other matters identified in the Company's April 16, 2013 Form 8-K, as amended. The consolidated amended complaint asserts claims under Sections 10(b) and 20 of the Exchange Act based on alleged false statements made regarding these issues throughout the alleged class period, as well as claims under Sections 11, 12, and 15 of the Securities Act based on alleged false statements and omissions regarding the Company’s internal controls made in connection with a public offering that Magnum Hunter completed on May 14, 2012. The consolidated amended complaint demands that the defendants pay unspecified damages to the class action plaintiffs, including damages allegedly caused by the decline in the Company's stock price between February 22, 2013 and April 22, 2013. In January 2014, the Company and the individual defendants filed a motion to dismiss the Securities Cases, which is pending for decision. The Company and the individual defendants intend to vigorously defend the Securities Cases. It is possible that additional investor lawsuits could be filed over these events. | |
On May 10, 2013, Steven Handshu filed a stockholder derivative suit in the 151st Judicial District Court of Harris County, Texas on behalf of the Company against the Company's directors and senior officers. On June 6, 2013, Zachariah Hanft filed another stockholder derivative suit in the Southern District of New York on behalf of the Company against the Company's directors and senior officers. On June 18, 2013, Mark Respler filed another stockholder derivative suit in the District of Delaware on behalf of the Company against the Company's directors and senior officers. On June 27, 2013, Timothy Bassett filed another stockholder derivative suit in the Southern District of Texas on behalf of the Company against the Company's directors and senior officers. On September 16, 2013, the Southern District of Texas allowed Joseph Vitellone to substitute for Mr. Bassett as plaintiff in that action. On March 19, 2014 Richard Harveth filed another stockholder derivative suit in the 125th District Court of Harris County, Texas. These suits are collectively referred to as the Derivative Cases. The Derivative Cases assert that the individual defendants unjustly enriched themselves and breached their fiduciary duties to the Company by publishing allegedly false and misleading statements to the Company's investors regarding the Company's business and financial position and results, and allegedly failing to maintain adequate internal controls. The complaints demand that the defendants pay unspecified damages to the Company, including damages allegedly sustained by the Company as a result of the alleged breaches of fiduciary duties by the defendants, as well as disgorgement of profits and benefits obtained by the defendants, and reasonable attorneys', accountants' and experts' fees and costs to the plaintiff. On December 20, 2013, the United States District Court for the Southern District of Texas granted the Company’s motion to dismiss the stockholder derivative case maintained by Joseph Vitellone and entered a final judgment of dismissal. The court held that Mr. Vitellone failed to plead particularized facts demonstrating that pre-suit demand on the Company’s board was excused. In addition, on December 13, 2013, the 151st Judicial District Court of Harris County, Texas dismissed the lawsuit filed by Steven Handshu for want of prosecution after the plaintiff failed to serve any defendant in that matter. On January 21, 2014, the Hanft complaint was dismissed with prejudice after the plaintiff in that action filed a voluntary motion for dismissal. On February 18, 2014, the United States District Judge for the District of Delaware granted the Company’s supplemental motion to dismiss the Derivative Case filed by Mark Respler. All of the Derivative Cases have now been dismissed except the Derivative Case filed by Richard Harveth, although it is possible that additional stockholder derivative suits could be filed over these events. | |
In addition, the Company has received several demand letters from stockholders seeking books and records relating to the allegations in the Securities Cases and the Derivative Cases under Section 220 of the Delaware General Corporation Law. On September 17, 2013, Anthony Scavo, who is one of the stockholders that made a demand, filed a books and records action in the Delaware Court of Chancery pursuant to Section 220 of the Delaware General Corporation Law (the “Scavo Action”). The Scavo Action seeks various books and records relating to the claims in the Securities Cases and the Derivative Cases, as well as costs and attorneys’ fees. The Company has filed an answer in the Scavo Action. It is possible that additional similar actions may be filed and that similar stockholder demands could be made. | |
The Company also received an April 26, 2013 letter from the SEC stating that the SEC's Division of Enforcement was conducting an inquiry regarding the Company's internal controls, change in outside auditors and public statements to investors and asking the Company to preserve documents relating to these matters. The Company is complying with this request. On December 30, 2013, the Company received a document subpoena relating to the issues identified in the April 26, 2013 letter, and the SEC has also issued subpoenas for testimony and has taken testimony from certain individuals. The Company intends to cooperate with the subpoenas. | |
Any potential liability from these claims cannot currently be estimated. | |
We are also a defendant in several other lawsuits that have arisen in the ordinary course of business. While the outcome of these lawsuits cannot be predicted with certainty, management does not expect any of these to have a material adverse effect on our consolidated financial condition or results of operations. | |
Twin Hickory Matter | |
On April 11, 2013, a flash fire occurred at Eureka Hunter Pipeline’s Twin Hickory site located in Tyler County, West Virginia. The incident occurred during a pigging operation at a natural gas receiving station. Two employees of third-party contractors received fatal injuries. Another employee of a third-party contractor was injured. | |
In mid-February 2014, the estate of one of the deceased third-party contractor employees sued Eureka Hunter Pipeline and certain other parties in Karen S. Phipps v. Eureka Hunter Pipeline, LLC et al., Civil Action No. 14-C-41, in the Circuit Court of Ohio County, West Virginia. In April 2014, the estate of the other descendant third-party contractor employee sued the Company, Eureka Hunter Pipeline and certain other parties in Antoinette M. Miller v. Magnum Hunter Resources Corporation et al, Civil Action No. 14-C-111, in the Circuit Court of Ohio County, West Virginia. The plaintiffs allege that Eureka Hunter Pipeline and the other defendants engaged in certain negligent and reckless conduct which resulted in the wrongful death of the third-party contractor employees. The plaintiffs have demanded judgment for an unspecified amount of compensatory, general and punitive damages. Various cross-claims have been asserted. A pre-suit settlement demand has also been received from the injured individual. Investigation regarding the incident is ongoing. It is not possible to predict at this juncture the extent to which, if at all, Eureka Hunter Pipeline or any related entities will incur liability or damages because of this incident. However, the Company believes that its insurance coverage will be sufficient to cover any losses or liabilities it may incur as a result of this incident. | |
PRC Williston Matter | |
On December 16, 2013, Drawbridge Special Opportunities Fund LP and Fortress Value Recovery Fund I LLC f/k/a D.B. Zwirn Special Opportunities Fund, L.P. (together, the “Plaintiffs”) filed suit against PRC Williston in the Court of Chancery of the State of Delaware. PRC Williston and the Plaintiffs entered into Participation Agreements in February 2007 in connection with the Plaintiffs extending credit to PRC Williston pursuant to a credit agreement entitling the Plaintiffs to a 12.5% collective interest in any distributions in respect of the equity interests of the members of PRC Williston. Plaintiffs claim that they are entitled to compensation for 12.5% of alleged past distributions on equity from PRC Williston to Magnum Hunter and 12.5% of any transfers of funds to Magnum Hunter from the proceeds of the December 30, 2013 sale of PRC Williston’s assets. On December 23, 2013, the Chancery Court entered a temporary restraining order prohibiting PRC Williston from transferring, assigning, removing, distributing or otherwise displacing to Magnum Hunter, Magnum Hunter’s creditors, or any other person or entity, $5.0 million of the proceeds received by PRC Williston in connection with the sale of its assets. The Court also granted Plaintiffs’ motion for expedited proceedings, ordering expedited discovery and a hearing within 90 days on Plaintiffs’ motion for a preliminary injunction. On March 18, 2014, the Court granted Plaintiffs’ motion for a preliminary injunction, extending the relief granted by the temporary restraining order until after a full trial on the merits. The Court has not set a trial date or any pre-trial deadlines. PRC Williston believes the claim is without merit and intends to vigorously defend the lawsuit. |
SUPPLEMENTAL_CASH_FLOW_INFORMA
SUPPLEMENTAL CASH FLOW INFORMATION (Notes) | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Supplemental Cash Flow Elements [Abstract] | ' | |||||||
SUPPLEMENTAL CASH FLOW INFORMATION | ' | |||||||
NOTE 17 - SUPPLEMENTAL CASH FLOW INFORMATION | ||||||||
The following table summarizes cash paid (received) for interest and income taxes, as well as non-cash investing transactions: | ||||||||
Three Months Ended March 31, | ||||||||
2014 | 2013 | |||||||
(in thousands) | ||||||||
Cash paid for interest | $ | 3,660 | $ | 3,928 | ||||
Non-cash transactions | ||||||||
Non-cash consideration received from sale of assets | $ | 9,400 | $ | — | ||||
Change in accrued capital expenditures | $ | 55,396 | $ | 9,377 | ||||
Non-cash additions to asset retirement obligation | $ | 52 | $ | 1,964 | ||||
Eureka Hunter Holdings Series A Preferred Unit dividends paid in kind | $ | 1,900 | $ | 2,253 | ||||
SEGMENT_REPORTING
SEGMENT REPORTING | 3 Months Ended | |||||||||||||||||||||||||||
Mar. 31, 2014 | ||||||||||||||||||||||||||||
Segment Reporting [Abstract] | ' | |||||||||||||||||||||||||||
SEGMENT REPORTING | ' | |||||||||||||||||||||||||||
NOTE 18 - SEGMENT REPORTING | ||||||||||||||||||||||||||||
Magnum Hunter has four reportable operating segments: U.S. Upstream, Midstream and Oilfield Services represent the operating segments of the Company. Beginning September 30, 2013, the Canadian Upstream segment, comprised of the WHI Canada operations, has been classified as assets held for sale and discontinued operations. | ||||||||||||||||||||||||||||
The following tables set forth operating activities by segment for the three months ended March 31, 2014 and 2013, respectively. | ||||||||||||||||||||||||||||
As of and for the Three Months Ended March 31, 2014 | ||||||||||||||||||||||||||||
U.S. | Canadian | Midstream and Marketing | Oilfield | Corporate | Inter-segment | Total | ||||||||||||||||||||||
Upstream | Upstream | Services | Unallocated | Eliminations | ||||||||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||||||
Total revenue | $ | 70,174 | $ | — | $ | 34,735 | $ | 7,911 | $ | — | $ | (5,376 | ) | $ | 107,444 | |||||||||||||
Depletion, depreciation, amortization and accretion | 24,939 | — | 3,678 | 791 | — | — | 29,408 | |||||||||||||||||||||
Loss on sale of assets, net | 3,457 | — | — | 2 | — | — | 3,459 | |||||||||||||||||||||
Other operating expenses | 44,729 | — | 32,070 | 6,713 | 10,488 | (5,223 | ) | 88,777 | ||||||||||||||||||||
Other income (expense) | (278 | ) | — | 30 | (209 | ) | (23,244 | ) | — | (23,701 | ) | |||||||||||||||||
Loss from continuing operations before income tax | (3,229 | ) | — | (983 | ) | 196 | (33,732 | ) | (153 | ) | (37,901 | ) | ||||||||||||||||
Total income (loss) from discontinued operations, net of tax | (23,128 | ) | (825 | ) | — | — | — | 153 | (23,800 | ) | ||||||||||||||||||
Net income (loss) | $ | (26,357 | ) | $ | (825 | ) | $ | (983 | ) | $ | 196 | $ | (33,732 | ) | $ | — | $ | (61,701 | ) | |||||||||
Total assets | $ | 1,369,962 | $ | 64,147 | $ | 322,030 | $ | 45,021 | $ | 98,526 | $ | (5,833 | ) | $ | 1,893,853 | |||||||||||||
Total capital expenditures | $ | 66,311 | $ | 308 | $ | 30,634 | $ | 690 | $ | 23 | $ | — | $ | 97,966 | ||||||||||||||
As of and for the Three Months Ended March 31, 2013 | ||||||||||||||||||||||||||||
U.S. | Canadian | Midstream and Marketing | Oilfield | Corporate | Inter-segment | Total | ||||||||||||||||||||||
Upstream | Upstream | Services | Unallocated | Eliminations | ||||||||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||||||
Total revenue | $ | 34,645 | $ | — | $ | 17,302 | $ | 3,731 | $ | — | $ | (1,444 | ) | $ | 54,234 | |||||||||||||
Depletion, depreciation, amortization and accretion | 14,263 | — | 2,687 | 338 | — | — | 17,288 | |||||||||||||||||||||
(Gain) loss on sale of assets, net | (19 | ) | — | — | — | — | — | (19 | ) | |||||||||||||||||||
Other operating expenses | 44,063 | — | 14,668 | 3,699 | 15,990 | (1,444 | ) | 76,976 | ||||||||||||||||||||
Other income (expense) | (2,123 | ) | — | (1,095 | ) | (89 | ) | (23,126 | ) | 82 | (26,351 | ) | ||||||||||||||||
Loss from continuing operations before income tax | (25,785 | ) | — | (1,148 | ) | (395 | ) | (39,116 | ) | 82 | (66,362 | ) | ||||||||||||||||
Income tax benefit | 4,854 | — | — | — | 45 | — | 4,899 | |||||||||||||||||||||
Total income from discontinued operations, net of tax | 16,489 | 356 | — | — | — | (82 | ) | 16,763 | ||||||||||||||||||||
Net income (loss) | $ | (4,442 | ) | $ | 356 | $ | (1,148 | ) | $ | (395 | ) | $ | (39,071 | ) | $ | — | $ | (44,700 | ) | |||||||||
Total assets | $ | 1,658,324 | $ | 262,320 | $ | 240,861 | $ | 29,121 | $ | 125,233 | $ | (1,930 | ) | $ | 2,313,929 | |||||||||||||
Total capital expenditures | $ | 112,344 | $ | 12,256 | $ | 22,295 | $ | 7,956 | $ | 172 | $ | — | $ | 155,023 | ||||||||||||||
CONDENSED_CONSOLIDATING_GUARAN
CONDENSED CONSOLIDATING GUARANTOR FINANCIAL STATEMENTS | 3 Months Ended | |||||||||||||||||||
Mar. 31, 2014 | ||||||||||||||||||||
Guarantees [Abstract] | ' | |||||||||||||||||||
CONDENSED CONSOLIDATING GUARANTOR FINANCIAL STATEMENTS | ' | |||||||||||||||||||
NOTE 19 - CONDENSED CONSOLIDATED GUARANTOR FINANCIAL STATEMENTS | ||||||||||||||||||||
Senior Notes | ||||||||||||||||||||
Certain of the Company’s subsidiaries, including Alpha Hunter Drilling, Bakken Hunter, LLC, Shale Hunter, Magnum Hunter Marketing, LLC, Magnum Hunter Production, Inc., NGAS Hunter, LLC, Triad Hunter, and Viking International Resources, Co., Inc. (collectively, "Guarantor Subsidiaries"), jointly and severally guarantee on a senior unsecured basis, the obligations of the Company under all the Senior Notes issued under the indenture entered into by the Company on May 16, 2012, as supplemented. | ||||||||||||||||||||
These condensed consolidating guarantor financial statements have been revised to reflect Eagle Ford Hunter, PRC Williston, and Williston Hunter ND, LLC as non-guarantors as the subsidiaries are no longer guarantors of the Company's Senior Notes. | ||||||||||||||||||||
Condensed consolidating financial information for Magnum Hunter Resources Corporation, the Guarantor Subsidiaries and the other subsidiaries of the Company (the “Non Guarantor Subsidiaries”) as of March 31, 2014 and December 31, 2013, and for the three months ended March 31, 2014 and 2013, are as follows: | ||||||||||||||||||||
Magnum Hunter Resources Corporation and Subsidiaries | ||||||||||||||||||||
Condensed Consolidating Balance Sheets | ||||||||||||||||||||
(in thousands) | ||||||||||||||||||||
As of March 31, 2014 | ||||||||||||||||||||
Magnum Hunter | 100% Owned Guarantor | Non Guarantor | Consolidating/ Eliminating Adjustments | Magnum Hunter | ||||||||||||||||
Resources | Subsidiaries | Subsidiaries | Resources | |||||||||||||||||
Corporation | Corporation | |||||||||||||||||||
Consolidated | ||||||||||||||||||||
ASSETS | ||||||||||||||||||||
Current assets | $ | 75,046 | $ | 64,639 | $ | 22,320 | $ | (5,833 | ) | $ | 156,172 | |||||||||
Intercompany accounts receivable | 953,626 | — | — | (953,626 | ) | — | ||||||||||||||
Property and equipment (using successful efforts method of accounting) | 6,362 | 1,269,856 | 262,267 | — | 1,538,485 | |||||||||||||||
Investment in subsidiaries | 347,169 | 102,469 | — | (449,638 | ) | — | ||||||||||||||
Assets held for sale and other | 17,118 | 86,675 | 95,403 | — | 199,196 | |||||||||||||||
Total Assets | $ | 1,399,321 | $ | 1,523,639 | $ | 379,990 | $ | (1,409,097 | ) | $ | 1,893,853 | |||||||||
LIABILITIES AND SHAREHOLDERS' EQUITY | ||||||||||||||||||||
Current liabilities | $ | 76,184 | $ | 131,868 | $ | 47,832 | $ | (5,868 | ) | $ | 250,016 | |||||||||
Intercompany accounts payable | — | 911,751 | 41,843 | (953,594 | ) | — | ||||||||||||||
Long-term liabilities | 826,507 | 40,506 | 128,879 | — | 995,892 | |||||||||||||||
Redeemable preferred stock | 100,000 | — | 142,275 | — | 242,275 | |||||||||||||||
Shareholders' equity (deficit) | 396,630 | 439,514 | 19,161 | (449,635 | ) | 405,670 | ||||||||||||||
Total Liabilities and Shareholders' Equity | $ | 1,399,321 | $ | 1,523,639 | $ | 379,990 | $ | (1,409,097 | ) | $ | 1,893,853 | |||||||||
Magnum Hunter Resources Corporation and Subsidiaries | ||||||||||||||||||||
Condensed Consolidating Balance Sheets | ||||||||||||||||||||
(in thousands) | ||||||||||||||||||||
As of December 31, 2013 | ||||||||||||||||||||
Magnum Hunter | 100% Owned Guarantor | Non Guarantor | Consolidating/ Eliminating Adjustments | Magnum Hunter | ||||||||||||||||
Resources | Subsidiaries | Subsidiaries | Resources | |||||||||||||||||
Corporation | Corporation | |||||||||||||||||||
Consolidated | ||||||||||||||||||||
ASSETS | ||||||||||||||||||||
Current assets | $ | 53,161 | $ | 43,841 | $ | 27,096 | $ | (3,372 | ) | $ | 120,726 | |||||||||
Intercompany accounts receivable | 965,138 | — | — | (965,138 | ) | — | ||||||||||||||
Property and equipment (using successful efforts method of accounting) | 7,214 | 1,272,027 | 234,838 | — | 1,514,079 | |||||||||||||||
Investment in subsidiaries | 372,236 | 102,314 | — | (474,550 | ) | — | ||||||||||||||
Other assets | 17,308 | 100,894 | 103,644 | — | 221,846 | |||||||||||||||
Total Assets | $ | 1,415,057 | $ | 1,519,076 | $ | 365,578 | $ | (1,443,060 | ) | $ | 1,856,651 | |||||||||
LIABILITIES AND SHAREHOLDERS' EQUITY | ||||||||||||||||||||
Current liabilities | $ | 54,826 | $ | 97,520 | $ | 34,929 | $ | (3,410 | ) | $ | 183,865 | |||||||||
Intercompany accounts payable | — | 921,237 | 43,866 | (965,103 | ) | — | ||||||||||||||
Long-term liabilities | 818,651 | 39,067 | 127,663 | — | 985,381 | |||||||||||||||
Redeemable preferred stock | 100,000 | — | 136,675 | — | 236,675 | |||||||||||||||
Shareholders' equity (deficit) | 441,580 | 461,252 | 22,445 | (474,547 | ) | 450,730 | ||||||||||||||
Total Liabilities and Shareholders' Equity | $ | 1,415,057 | $ | 1,519,076 | $ | 365,578 | $ | (1,443,060 | ) | $ | 1,856,651 | |||||||||
Magnum Hunter Resources Corporation and Subsidiaries | ||||||||||||||||||||
Condensed Consolidating Statements of Operations | ||||||||||||||||||||
(in thousands) | ||||||||||||||||||||
Three Months Ended March 31, 2014 | ||||||||||||||||||||
Magnum Hunter | 100% Owned Guarantor | Non Guarantor | Consolidating/ Eliminating Adjustments | Magnum Hunter | ||||||||||||||||
Resources | Subsidiaries | Subsidiaries | Resources | |||||||||||||||||
Corporation | Corporation | |||||||||||||||||||
Consolidated | ||||||||||||||||||||
Revenues | $ | 108 | $ | 104,014 | $ | 8,698 | $ | (5,376 | ) | $ | 107,444 | |||||||||
Expenses | 34,793 | 107,084 | 8,692 | (5,224 | ) | 145,345 | ||||||||||||||
Loss from continuing operations before equity in net income of subsidiaries | (34,685 | ) | (3,070 | ) | 6 | (152 | ) | (37,901 | ) | |||||||||||
Equity in net income of subsidiaries | (28,815 | ) | 155 | — | 28,660 | — | ||||||||||||||
Loss from continuing operations before income tax | (63,500 | ) | (2,915 | ) | 6 | 28,508 | (37,901 | ) | ||||||||||||
Income tax benefit (expense) | — | — | — | — | — | |||||||||||||||
Loss from continuing operations | (63,500 | ) | (2,915 | ) | 6 | 28,508 | (37,901 | ) | ||||||||||||
Income from discontinued operations, net of tax | — | (117 | ) | 3,327 | 152 | 3,362 | ||||||||||||||
Gain on sale of discontinued operations, net of tax | (4,319 | ) | (18,649 | ) | (4,194 | ) | — | (27,162 | ) | |||||||||||
Net income (loss) | (67,819 | ) | (21,681 | ) | (861 | ) | 28,660 | (61,701 | ) | |||||||||||
Net loss attributable to non-controlling interest | — | — | — | 109 | 109 | |||||||||||||||
Net loss attributable to Magnum Hunter Resources Corporation | (67,819 | ) | (21,681 | ) | (861 | ) | 28,769 | (61,592 | ) | |||||||||||
Dividends on preferred stock | (8,820 | ) | — | (6,076 | ) | — | (14,896 | ) | ||||||||||||
Net income (loss) attributable to common shareholders | $ | (76,639 | ) | $ | (21,681 | ) | $ | (6,937 | ) | $ | 28,769 | $ | (76,488 | ) | ||||||
Magnum Hunter Resources Corporation and Subsidiaries | ||||||||||||||||||||
Condensed Consolidating Statements of Operations | ||||||||||||||||||||
(in thousands) | ||||||||||||||||||||
Three Months Ended March 31, 2013 | ||||||||||||||||||||
Magnum Hunter | 100% Owned Guarantor | Non Guarantor | Consolidating/ Eliminating Adjustments | Magnum Hunter | ||||||||||||||||
Resources | Subsidiaries | Subsidiaries | Resources | |||||||||||||||||
Corporation | Corporation | |||||||||||||||||||
Consolidated | ||||||||||||||||||||
Revenues | $ | (175 | ) | $ | 47,362 | $ | 8,491 | $ | (1,444 | ) | $ | 54,234 | ||||||||
Expenses | 39,632 | 71,673 | 10,817 | (1,526 | ) | 120,596 | ||||||||||||||
Income (loss) from continuing operations before equity in net income of subsidiaries | (39,807 | ) | (24,311 | ) | (2,326 | ) | 82 | (66,362 | ) | |||||||||||
Equity in net income of subsidiaries | (9,083 | ) | (529 | ) | (7,805 | ) | 17,417 | — | ||||||||||||
Income (loss) from continuing operations before income tax | (48,890 | ) | (24,840 | ) | (10,131 | ) | 17,499 | (66,362 | ) | |||||||||||
Income tax benefit | 45 | 4,854 | — | — | 4,899 | |||||||||||||||
Income (loss) from continuing operations | (48,845 | ) | (19,986 | ) | (10,131 | ) | 17,499 | (61,463 | ) | |||||||||||
Income from discontinued operations, net of tax | — | (109 | ) | 16,954 | (82 | ) | 16,763 | |||||||||||||
Gain on sale of discontinued operations, net of tax | — | — | — | — | — | |||||||||||||||
Net income (loss) | (48,845 | ) | (20,095 | ) | 6,823 | 17,417 | (44,700 | ) | ||||||||||||
Net income attributable to non-controlling interest | — | — | — | 503 | 503 | |||||||||||||||
Net income (loss) attributable to Magnum Hunter Resources Corporation | (48,845 | ) | (20,095 | ) | 6,823 | 17,920 | (44,197 | ) | ||||||||||||
Dividends on preferred stock | (8,906 | ) | — | (4,582 | ) | — | (13,488 | ) | ||||||||||||
Net income (loss) attributable to common shareholders | $ | (57,751 | ) | $ | (20,095 | ) | $ | 2,241 | $ | 17,920 | $ | (57,685 | ) | |||||||
Magnum Hunter Resources Corporation and Subsidiaries | ||||||||||||||||||||
Condensed Consolidating Statements of Comprehensive Income (Loss) | ||||||||||||||||||||
(in thousands) | ||||||||||||||||||||
Three Months Ended March 31, 2014 | ||||||||||||||||||||
Magnum Hunter | 100% Owned Guarantor | Non Guarantor | Consolidating/ Eliminating Adjustments | Magnum Hunter | ||||||||||||||||
Resources | Subsidiaries | Subsidiaries | Resources | |||||||||||||||||
Corporation | Corporation | |||||||||||||||||||
Consolidated | ||||||||||||||||||||
Net income (loss) | $ | (67,819 | ) | $ | (21,681 | ) | $ | (861 | ) | $ | 28,660 | (61,701 | ) | |||||||
Foreign currency translation loss | — | — | (2,348 | ) | — | (2,348 | ) | |||||||||||||
Unrealized gain (loss) on available for sale securities | — | (56 | ) | — | — | (56 | ) | |||||||||||||
Comprehensive income (loss) | (67,819 | ) | (21,737 | ) | (3,209 | ) | 28,660 | (64,105 | ) | |||||||||||
Comprehensive loss attributable to non-controlling interest | — | — | — | 109 | 109 | |||||||||||||||
Comprehensive income (loss) attributable to Magnum Hunter Resources Corporation | $ | (67,819 | ) | $ | (21,737 | ) | $ | (3,209 | ) | $ | 28,769 | (63,996 | ) | |||||||
Three Months Ended March 31, 2013 | ||||||||||||||||||||
Magnum Hunter | 100% Owned Guarantor | Non Guarantor | Consolidating/ Eliminating Adjustments | Magnum Hunter | ||||||||||||||||
Resources | Subsidiaries | Subsidiaries | Resources | |||||||||||||||||
Corporation | Corporation | |||||||||||||||||||
Consolidated | ||||||||||||||||||||
Net income (loss) | $ | (48,845 | ) | $ | (20,095 | ) | $ | 6,823 | $ | 17,417 | (44,700 | ) | ||||||||
Foreign currency translation loss | — | — | (4,729 | ) | — | (4,729 | ) | |||||||||||||
Unrealized gain (loss) on available for sale securities | — | (17 | ) | — | — | (17 | ) | |||||||||||||
Comprehensive income (loss) | (48,845 | ) | (20,112 | ) | 2,094 | 17,417 | (49,446 | ) | ||||||||||||
Comprehensive income attributable to non-controlling interest | — | — | — | 503 | 503 | |||||||||||||||
Comprehensive income (loss) attributable to Magnum Hunter Resources Corporation | $ | (48,845 | ) | (20,112 | ) | 2,094 | 17,920 | (48,943 | ) | |||||||||||
Magnum Hunter Resources Corporation and Subsidiaries | ||||||||||||||||||||
Condensed Consolidating Statements of Cash Flows | ||||||||||||||||||||
(in thousands) | ||||||||||||||||||||
Three Months Ended March 31, 2014 | ||||||||||||||||||||
Magnum Hunter | 100% Owned Guarantor | Non Guarantor | Consolidating/ Eliminating Adjustments | Magnum Hunter | ||||||||||||||||
Resources | Subsidiaries | Subsidiaries | Resources | |||||||||||||||||
Corporation | Corporation | |||||||||||||||||||
Consolidated | ||||||||||||||||||||
Cash flow from operating activities | $ | (8,779 | ) | $ | 4,611 | $ | 8,045 | $ | — | $ | 3,877 | |||||||||
Cash flow from investing activities | (181 | ) | (4,070 | ) | (18,568 | ) | — | (22,819 | ) | |||||||||||
Cash flow from financing activities | 31,886 | 4,050 | 5,720 | — | 41,656 | |||||||||||||||
Effect of exchange rate changes on cash | — | — | 25 | — | 25 | |||||||||||||||
Net increase (decrease) in cash | 22,926 | 4,591 | (4,778 | ) | — | 22,739 | ||||||||||||||
Cash at beginning of period | 47,895 | (17,651 | ) | 11,469 | — | 41,713 | ||||||||||||||
Cash at end of period | $ | 70,821 | $ | (13,060 | ) | $ | 6,691 | $ | — | $ | 64,452 | |||||||||
Three Months Ended March 31, 2013 | ||||||||||||||||||||
Magnum Hunter | 100% Owned Guarantor | Non Guarantor | Consolidating/ Eliminating Adjustments | Magnum Hunter | ||||||||||||||||
Resources | Subsidiaries | Subsidiaries | Resources | |||||||||||||||||
Corporation | Corporation | |||||||||||||||||||
Consolidated | ||||||||||||||||||||
Cash flow from operating activities | $ | (33,357 | ) | $ | 89,742 | $ | 22,072 | $ | (836 | ) | $ | 77,621 | ||||||||
Cash flow from investing activities | (142 | ) | (89,577 | ) | (54,718 | ) | — | (144,437 | ) | |||||||||||
Cash flow from financing activities | 100,852 | 402 | (864 | ) | — | 100,390 | ||||||||||||||
Effect of exchange rate changes on cash | — | — | (21 | ) | — | (21 | ) | |||||||||||||
Net increase (decrease) in cash | 67,353 | 567 | (33,531 | ) | (836 | ) | 33,553 | |||||||||||||
Cash at beginning of period | 26,871 | (12,582 | ) | 43,334 | — | 57,623 | ||||||||||||||
Cash at end of period | $ | 94,224 | $ | (12,015 | ) | $ | 9,803 | $ | (836 | ) | $ | 91,176 | ||||||||
SUBSEQUENT_EVENTS
SUBSEQUENT EVENTS | 3 Months Ended | |
Mar. 31, 2014 | ||
Subsequent Events [Abstract] | ' | |
SUBSEQUENT EVENTS | ' | |
NOTE 20 - SUBSEQUENT EVENTS | ||
Williston Hunter Canada Asset Sale | ||
On April 10, 2014, WHI Canada closed on the sale of certain oil and natural gas properties and assets located in Alberta, Canada for cash consideration of CAD $9.5 million in cash (approximately U.S. $8.7 million at the exchange rate as of the close of business on April 10, 2014). The effective date of the sale was January 1, 2014. | ||
Issuance of Eureka Hunter Holdings Series A Preferred Units | ||
On April 14, 2014, Eureka Hunter Holdings issued 410,000 Eureka Hunter Holdings Series A Preferred Units to Ridgeline for proceeds of $8.0 million net of transaction costs. This transaction completed Ridgeline's commitment to purchase up to $200 million of Eureka Hunter Holdings Series A Preferred Units under the Unit Purchase Agreement. As of the date of filing of this Quarterly Report on Form 10-Q, the Eureka Hunter Holdings Series A Preferred Units outstanding represented 42.98% of the ownership of Eureka Hunter Holdings on a basis as converted to Class A Common Units of Eureka Hunter Holdings. | ||
Additional Borrowing under the Eureka Hunter Pipeline Credit Agreement | ||
On April 17, 2014, Eureka Hunter Pipeline borrowed an additional $10.0 million under the Eureka Hunter Pipeline Credit Agreement. As of the date of filing this Quarterly Report on Form 10-Q, the balance outstanding was $65.0 million. | ||
Sale of WHI Canada | ||
On April 21, 2014, the Company entered into a definitive agreement with a Canadian private company to sell 100% of its ownership interest in the Company's Canadian subsidiary, WHI Canada, whose assets consist primarily of oil and natural gas properties located in the Tableland Field in Saskatchewan, Canada, for a purchase price of CAD $75.0 million (approximately U.S. $67.5 million at the exchange rate as of the close of business on April 21, 2014), subject to customary purchase price adjustments with an effective date of March 1, 2014. The transaction is expected to close in May, 2014. | ||
Amendment to Credit Agreement | ||
On May 6, 2014 the Company executed an amendment to the Third Amended and Restated Credit Agreement, dated as of December 13, 2013 (the "Credit Agreement"), by and among the Company, as borrower, the guarantors party thereto, Bank of Montreal, as administrative agent, the lenders party thereto and the agents party thereto. | ||
With the execution of the Amendment, the borrowing base was increased from $232.5 million to $325.0 million in connection with the regular semi‑annual redetermination of the Company’s borrowing base derived from the Company’s proved crude oil and natural gas reserves. The borrowing base may be increased or decreased in connection with such redeterminations up to a maximum commitment level of $750.0 million. | ||
In connection with the borrowing base increase, the Company and the other parties to the Credit Agreement entered into the First Amendment to Third Amended and Restated Credit Agreement, dated as of May 6, 2014 (the "Amendment"). The Amendment increases the borrowing base to $325.0 million and provides that such increased borrowing base shall be reduced (i) by the lesser of $25.0 million or 50% of the net proceeds from issuances by the Company of common equity on or before July 1, 2014 (other than common equity issued pursuant to any stock incentive or stock option plan or any other compensatory arrangements); (ii) by certain specified reductions in connection with certain proposed asset dispositions; (iii) on July 1, 2014 by $25.0 million less any prior adjustment of the borrowing base due to an equity issuance as contemplated by clause (i); and (iv) by $0.25 for each $1.00 of any Senior Notes issued by the Company. The Amendment further provides that from May 6, 2014 through July 1, 2014 the Applicable Margin (as defined in the Credit Agreement) component of the interest charged on revolving borrowings under the Credit Agreement shall be 2.75% for ABR Loans (as defined in the Credit Agreement) and 3.75% for Eurodollar Loans (as defined in the Credit Agreement). From and after July 1, 2014 through the date of the Company’s delivery of a certificate for the quarter ending June 30, 2014, with respect to, among other things, the Company’s compliance with the covenants in the Credit Agreement (the “Compliance Certificate”), the Applicable Margin component of interest charged on revolving borrowings under the Credit Agreement will range from 1.50% to 2.25% for ABR Loans and from 2.50% to 3.25% for Eurodollar Loans. From and after the Company’s delivery of the Compliance Certificate, the Applicable Margin component of interest charged on revolving borrowings under the Credit Agreement will range from 1.00% to 1.75% for ABR Loans and from 2.00% to 2.75% for Eurodollar Loans. | ||
In addition, the Amendment modified certain of the Credit Agreement’s financial covenants, including: | ||
(i) | permitting the Company to take into account the borrowing base increase as though it occurred on March 31, 2014 for purposes of maintaining a ratio of consolidated current assets to consolidated current liabilities of not less than 1.0 to 1.0; | |
(ii) | providing for a ratio of EBITDAX to Interest Expense of not more than (A) 2.00 to 1.0 for the fiscal quarter ended March 31, 2014, (B) 2.25 to 1.0 for the fiscal quarters ending June 30, 2014 and September 30, 2014, and (C) 2.50 to 1.0 for the fiscal quarter ended December 31, 2014 and for each fiscal quarter ending thereafter; and | |
(iii) | beginning with the fiscal quarter ending June 30, 2014, providing for a ratio of total Debt to EBITDAX of not more than (A) 4.75 to 1.0 for the fiscal quarters ending June 30, 2014 and September 30, 2014, (B) 4.50 to 1.0 for the fiscal quarter ending December 31, 2014, and (C) 4.25 to 1.0 for the fiscal quarter ending March 31, 2015 and for each fiscal quarter ending thereafter. | |
The Amendment also (i) amends the definition of EBITDAX and provides that certain acquisitions and dispositions be given pro forma effect in the calculation of EBITDAX; (ii) increases the letter of credit commitment from $10.0 million to $50.0 million and provides that outstanding letter of credit exposure not be included in certain determinations of Debt; (iii) requires the total value of the Company’s oil and gas properties included in the reserve reports for the borrowing base determinations in which the lenders under the Credit Agreement have perfected liens be increased from 80% to 90%; and (iv) modifies certain covenants in the Credit Agreement with respect to permitted investments by the Company to increase flexibility. |
GENERAL_Policies
GENERAL (Policies) | 3 Months Ended |
Mar. 31, 2014 | |
Accounting Policies [Abstract] | ' |
Principles of Consolidation and Presentation | ' |
Presentation of Consolidated Financial Statements | |
The accompanying unaudited interim consolidated financial statements of Magnum Hunter are presented in U.S. Dollars and have been prepared in accordance with accounting principles generally accepted in the United States ("GAAP"). The preparation of these consolidated financial statements in accordance 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 revenue and expenses during reporting periods. Actual results could differ materially from those estimates. | |
In the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary for the fair statement of the financial position and the results of operations for the interim periods presented have been reflected herein. The results of operations for interim periods are not necessarily indicative of the results to be expected for the full year. The year-end balance sheet data were derived from audited financial statements, but do not include all disclosures required by GAAP. | |
Certain information and disclosures normally included in the consolidated financial statements prepared in accordance with GAAP that would substantially duplicate the disclosures contained in the audited consolidated financial statements as reported in the Company's Annual Report on Form 10-K have been condensed or omitted. | |
Non-controlling Interest in Consolidated Subsidiaries | ' |
Non-Controlling Interest in Consolidated Subsidiaries | |
The Company has consolidated Eureka Hunter Holdings, LLC (“Eureka Hunter Holdings”) in which it owned 55.79% as of March 31, 2014 and 56.4% as of December 31, 2013. Eureka Hunter Holdings owns, directly or indirectly, 100% of the equity interests of Eureka Hunter Pipeline, LLC ("Eureka Hunter Pipeline"), TransTex Hunter, LLC ("TransTex Hunter"), and Eureka Hunter Land, LLC. | |
Reclassification of Prior-Year Balances | ' |
Reclassification of Prior-Year Balances | |
Certain prior period balances have been reclassified to correspond with current-year presentation. As a result of the Company's adoption of a plan in September 2013 to dispose of certain of its U.S. and Canadian properties, operating income and expenses related to these operations have been classified as discontinued operations for all periods presented. | |
Regulated Activities | ' |
Regulated Activities | |
Energy Hunter Securities, Inc. is a 100%-owned subsidiary and is a registered broker-dealer and member of the Financial Industry Regulatory Authority. Among other regulatory requirements, it is subject to the net capital provisions of Rule 15c3-1 under the Securities Exchange Act of 1934, as amended. Because it does not hold customer funds or securities or owe money or securities to customers, Energy Hunter Securities, Inc. is required to maintain minimum net capital equal to the greater of $5,000 or 6.67% of its aggregate indebtedness. | |
Recently Issued Accounting Standards | ' |
Recently Issued Accounting Standards | |
Accounting standards-setting organizations frequently issue new or revised accounting rules. The Company regularly reviews all new pronouncements to determine their impact, if any, on its financial statements. |
DIVESTITURES_AND_DISCONTINUED_1
DIVESTITURES AND DISCONTINUED OPERATIONS (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Discontinued Operations and Disposal Groups [Abstract] | ' | ||||||||
Schedule of Assets and Liabilities Held for Sale | ' | ||||||||
The following shows the Company's assets and liabilities held for sale at March 31, 2014 and December 31, 2013: | |||||||||
March 31, | December 31, | ||||||||
2014 | 2013 | ||||||||
(in thousands) | |||||||||
Accounts receivable | $ | 3,947 | $ | 4,362 | |||||
Other current assets | 1,071 | 1,004 | |||||||
Oil and natural gas properties, net | 127,068 | 150,770 | |||||||
Gas transportation, gathering, and processing equipment and other, net | 15,099 | 11,721 | |||||||
Other long-term assets | 182 | 196 | |||||||
Total assets held for sale | $ | 147,367 | $ | 168,053 | |||||
Accounts payable | $ | 10,215 | $ | 7,292 | |||||
Accrued expenses and other liabilities | 9,944 | 5,573 | |||||||
Asset retirement obligations | 8,485 | 8,678 | |||||||
Other long-term liabilities | 4,498 | 5,845 | |||||||
Total liabilities held for sale | $ | 33,142 | $ | 27,388 | |||||
Schedule of discontinued operations | ' | ||||||||
he Company included the results of operations of MHP and WHI Canada for all periods presented, and Eagle Ford Hunter through March 31, 2013, in discontinued operations as follows: | |||||||||
Three Months Ended | |||||||||
March 31, | |||||||||
2014 | 2013 | ||||||||
(in thousands) | |||||||||
Revenues | $ | 12,283 | $ | 43,790 | |||||
Expenses | (8,833 | ) | (28,225 | ) | |||||
Other income (expense) | (88 | ) | 1,243 | ||||||
Income tax expense | — | (45 | ) | ||||||
Income from discontinued operations, net of tax | 3,362 | 16,763 | |||||||
Loss on sale of discontinued operations, net of taxes | (27,162 | ) | — | ||||||
Income from discontinued operations, net of taxes | $ | (23,800 | ) | $ | 16,763 | ||||
OIL_NATURAL_GAS_SALES_Tables
OIL & NATURAL GAS SALES (Tables) | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Other Income and Expenses [Abstract] | ' | |||||||
Schedule of Oil Natural Gas And NGL Revenue | ' | |||||||
During the three months ended March 31, 2014 and 2013, the Company recognized sales from oil, natural gas, and natural gas liquids ("NGLs") as follows: | ||||||||
Three Months Ended March 31, | ||||||||
2014 | 2013 | |||||||
(in thousands) | ||||||||
Oil | $ | 34,272 | $ | 25,572 | ||||
Natural gas | 24,130 | 8,453 | ||||||
NGLs | 11,770 | 616 | ||||||
Total oil and natural gas sales | $ | 70,172 | $ | 34,641 | ||||
PROPERTY_PLANT_EQUIPMENT_Table
PROPERTY, PLANT, & EQUIPMENT (Tables) | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Property, Plant and Equipment [Abstract] | ' | |||||||
Capitalized Costs Relating to Oil and Gas Producing Activities Disclosure | ' | |||||||
The following sets forth the net capitalized costs under the successful efforts method for oil and natural gas properties as of: | ||||||||
March 31, | December 31, | |||||||
2014 | 2013 | |||||||
(in thousands) | ||||||||
Mineral interests in properties: | ||||||||
Unproved leasehold costs | $ | 455,772 | $ | 469,337 | ||||
Proved leasehold costs | 335,124 | 336,357 | ||||||
Wells and related equipment and facilities | 570,133 | 536,023 | ||||||
Advances to operators for wells in progress | 12,388 | 13,571 | ||||||
Total costs | 1,373,417 | 1,355,288 | ||||||
Less accumulated depletion, depreciation, and amortization | (152,119 | ) | (130,629 | ) | ||||
Net capitalized costs | $ | 1,221,298 | $ | 1,224,659 | ||||
The historical cost of gas transportation, gathering, and processing equipment and other property, presented on a gross basis with accumulated depreciation, as of March 31, 2014 and December 31, 2013 is summarized as follows: | ||||||||
March 31, | December 31, | |||||||
2014 | 2013 | |||||||
(in thousands) | ||||||||
Gas transportation, gathering and processing equipment and other | $ | 347,995 | $ | 315,642 | ||||
Less accumulated depreciation | (30,808 | ) | (26,222 | ) | ||||
Net capitalized costs | $ | 317,187 | $ | 289,420 | ||||
Schedule of the Company's geological and geophysical costs and leasehold abandonments expense | ' | |||||||
During the three months ended March 31, 2014 and 2013, the Company recognized exploration expense as follows: | ||||||||
Three Months Ended | ||||||||
March 31, | ||||||||
2014 | 2013 | |||||||
(in thousands) | ||||||||
Leasehold impairments | $ | 13,655 | $ | 29,353 | ||||
Geological and geophysical | 374 | 380 | ||||||
Total exploration expense | $ | 14,029 | $ | 29,733 | ||||
INTANGIBLE_ASSETS_Tables
INTANGIBLE ASSETS (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | ' | ||||||||
Schedule of Finite-Lived Intangible Assets [Table Text Block] | ' | ||||||||
Intangible assets consist primarily of gas gathering and processing contracts and customer relationships. The following table summarizes the Company's net intangible assets as of: | |||||||||
March 31, | December 31, | ||||||||
2014 | 2013 | ||||||||
(in thousands) | |||||||||
Customer relationships | $ | 5,434 | $ | 5,434 | |||||
Trademark | 859 | 859 | |||||||
Existing contracts | 4,199 | 4,199 | |||||||
Total intangible assets | 10,492 | 10,492 | |||||||
Less accumulated amortization | (4,463 | ) | (3,962 | ) | |||||
Intangible assets, net of accumulated amortization | $ | 6,029 | $ | 6,530 | |||||
INVENTORY_Tables
INVENTORY (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Inventory Disclosure [Abstract] | ' | ||||||||
Schedule of Inventory | ' | ||||||||
The following table shows the composition of the Company's inventory as of: | |||||||||
March 31, | December 31, | ||||||||
2014 | 2013 | ||||||||
(in thousands) | |||||||||
Materials and supplies | $ | 3,647 | $ | 6,790 | |||||
Commodities | 405 | 368 | |||||||
Inventory | $ | 4,052 | $ | 7,158 | |||||
ASSET_RETIREMENT_OBLIGATIONS_T
ASSET RETIREMENT OBLIGATIONS (Tables) | 3 Months Ended | ||||||
Mar. 31, 2014 | |||||||
Asset Retirement Obligation Disclosure [Abstract] | ' | ||||||
Summary of asset retirement obligation | ' | ||||||
The following table summarizes the Company’s asset retirement obligation ("ARO") activities during the three-month period ended March 31, 2014 and for the year ended December 31, 2013: | |||||||
31-Mar-14 | 31-Dec-13 | ||||||
(in thousands) | |||||||
Asset retirement obligation at beginning of period | $ | 16,216 | $ | 30,680 | |||
Assumed in acquisitions | — | 17 | |||||
Liabilities incurred | 52 | 253 | |||||
Liabilities settled | (17 | ) | (98 | ) | |||
Liabilities sold | (12 | ) | (7,614 | ) | |||
Accretion expense | 368 | 2,264 | |||||
Revisions in estimated liabilities (1) | — | 1,935 | |||||
Reclassified as liabilities associated with assets held for sale | — | (11,148 | ) | ||||
Effect of foreign currency translation | — | (73 | ) | ||||
Asset retirement obligation at end of period | 16,607 | 16,216 | |||||
Less: current portion (included in other liabilities) | (61 | ) | (53 | ) | |||
Asset retirement obligation at end of period | $ | 16,546 | $ | 16,163 | |||
________________________________ | |||||||
(1) $1.5 million of the revisions in estimated liabilities is related to change in assumptions used with respect to certain wells in the Williston Basin in North Dakota during 2013. |
FAIR_VALUE_OF_FINANCIAL_INSTRU1
FAIR VALUE OF FINANCIAL INSTRUMENTS (Tables) | 3 Months Ended | ||||||||||||||||||
Mar. 31, 2014 | |||||||||||||||||||
Fair Value Disclosures [Abstract] | ' | ||||||||||||||||||
Schedule of inputs used to calculated fair value of convertible security embedded derivative | ' | ||||||||||||||||||
The key inputs used in the Black-Scholes option pricing model were as follows: | |||||||||||||||||||
31-Mar-14 | |||||||||||||||||||
Life | 2.9 years | ||||||||||||||||||
Risk-free interest rate | 0.96 | % | |||||||||||||||||
Estimated volatility | 40 | % | |||||||||||||||||
Dividend | — | ||||||||||||||||||
GreenHunter stock price at end of period | $ | 0.96 | |||||||||||||||||
Schedule of reconciliation of derivative assets and (liabilities) measured at fair value using significant unobservable inputs | ' | ||||||||||||||||||
The following table presents a reconciliation of the financial derivative asset and liability measured at fair value using significant unobservable inputs (Level 3 inputs) for the three-month period ended March 31, 2014: | |||||||||||||||||||
Preferred Stock Embedded | Convertible Security Embedded | ||||||||||||||||||
Derivative Liability | Derivative Asset | ||||||||||||||||||
(in thousands) | |||||||||||||||||||
Fair value at December 31, 2013 | $ | (75,934 | ) | $ | 79 | ||||||||||||||
Issuance of redeemable preferred stock | (2,318 | ) | — | ||||||||||||||||
Decrease in fair value recognized in other income (expense) | 5,936 | (44 | ) | ||||||||||||||||
Fair value as of March 31, 2014 | $ | (72,316 | ) | $ | 35 | ||||||||||||||
Fair value measurements on a recurring basis | ' | ||||||||||||||||||
The following tables present the fair value hierarchy levels of the Company's financial assets and liabilities which are measured and carried at fair value on a recurring basis: | |||||||||||||||||||
Fair Value Measurements on a Recurring Basis | |||||||||||||||||||
31-Mar-14 | |||||||||||||||||||
(in thousands) | |||||||||||||||||||
Assets | Level 1 | Level 2 | Level 3 | ||||||||||||||||
Available for sale securities | $ | 11,210 | $ | — | $ | — | |||||||||||||
Commodity derivative assets | — | 585 | — | ||||||||||||||||
Convertible security derivative assets | — | — | 35 | ||||||||||||||||
Total assets at fair value | $ | 11,210 | $ | 585 | $ | 35 | |||||||||||||
Liabilities | |||||||||||||||||||
Commodity derivative liabilities | $ | — | $ | 5,571 | $ | — | |||||||||||||
Convertible preferred stock derivative liabilities | — | — | 72,316 | ||||||||||||||||
Total liabilities at fair value | $ | — | $ | 5,571 | $ | 72,316 | |||||||||||||
Fair Value Measurements on a Recurring Basis | |||||||||||||||||||
31-Dec-13 | |||||||||||||||||||
(in thousands) | |||||||||||||||||||
Assets | Level 1 | Level 2 | Level 3 | ||||||||||||||||
Available for sale securities | $ | 1,819 | $ | — | $ | — | |||||||||||||
Commodity derivative assets | — | 554 | — | ||||||||||||||||
Convertible security derivative assets | — | — | 79 | ||||||||||||||||
Total assets at fair value | $ | 1,819 | $ | 554 | $ | 79 | |||||||||||||
Liabilities | |||||||||||||||||||
Commodity derivative liabilities | $ | — | $ | 2,279 | $ | — | |||||||||||||
Convertible preferred stock derivative liabilities | — | — | 75,934 | ||||||||||||||||
Total liabilities at fair value | $ | — | $ | 2,279 | $ | 75,934 | |||||||||||||
Carrying amounts and fair values of long-term debt | ' | ||||||||||||||||||
The following table presents the carrying amounts and fair value categorized by fair value hierarchy level of the Company's financial instruments not carried at fair value: | |||||||||||||||||||
31-Mar-14 | 31-Dec-13 | ||||||||||||||||||
Fair Value Hierarchy | Carrying Amount | Estimated Fair Value | Carrying Amount | Estimated Fair Value | |||||||||||||||
(in thousands) | |||||||||||||||||||
Senior Notes | Level 2 | $ | 597,251 | $ | 666,000 | $ | 597,230 | $ | 651,300 | ||||||||||
MHR Senior Revolving Credit Facility | Level 3 | $ | 226,000 | $ | 226,000 | $ | 218,000 | $ | 218,000 | ||||||||||
Eureka Hunter Pipeline second lien term loan | Level 3 | $ | — | $ | — | $ | 50,000 | $ | 58,921 | ||||||||||
Eureka Hunter Pipeline Credit Agreement | Level 3 | $ | 55,000 | $ | 55,000 | $ | — | $ | — | ||||||||||
Equipment notes payable | Level 3 | $ | 25,609 | $ | 25,659 | $ | 18,615 | $ | 17,676 | ||||||||||
FINANCIAL_INSTRUMENTS_AND_DERI1
FINANCIAL INSTRUMENTS AND DERIVATIVES (Tables) | 3 Months Ended | ||||||||||||||||||
Mar. 31, 2014 | |||||||||||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ' | ||||||||||||||||||
Summary of changes in investments | ' | ||||||||||||||||||
Below is a summary of changes in investments for the period ended March 31, 2014: | |||||||||||||||||||
Available for Sale Securities (1) | Equity Method Investments (2) | ||||||||||||||||||
(in thousands) | |||||||||||||||||||
Carrying value as of December 31, 2013 | $ | 1,819 | $ | 940 | |||||||||||||||
Securities received as consideration for assets sold | 9,447 | — | |||||||||||||||||
Equity in net loss recognized in other income (expense) | — | (246 | ) | ||||||||||||||||
Change in fair value recognized in other comprehensive loss | (56 | ) | — | ||||||||||||||||
Carrying value as of March 31, 2014 | $ | 11,210 | $ | 694 | |||||||||||||||
-1 | Available for sale securities includes $142,000 that has been classified as held for sale associated with the classification of the MHP subsidiary. | ||||||||||||||||||
(2) Equity method investments includes $326,000 classified as long-term other assets. | |||||||||||||||||||
Schedule of investments by balance sheet grouping | ' | ||||||||||||||||||
The Company's investments have been presented in the consolidated balance sheet as of March 31, 2014 as follows: | |||||||||||||||||||
Available for Sale Securities | Equity Method Investments | Total | |||||||||||||||||
Investments - Current | $ | 11,068 | $ | 368 | $ | 11,436 | |||||||||||||
Investments - Long-Term | — | 326 | 326 | ||||||||||||||||
Investments - Held for Sale | 142 | — | 142 | ||||||||||||||||
Carrying value as of March 31,2014 | $ | 11,210 | $ | 694 | $ | 11,904 | |||||||||||||
Summary of cost for equity securities and fair value | ' | ||||||||||||||||||
The cost for equity securities and their respective fair values as of March 31, 2014 and December 31, 2013 are as follows: | |||||||||||||||||||
March 31, 2014 | |||||||||||||||||||
(in thousands) | |||||||||||||||||||
Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | ||||||||||||||||
Securities available for sale, carried at fair value: | |||||||||||||||||||
Equity securities | $ | 9,875 | $ | — | $ | (324 | ) | $ | 9,551 | ||||||||||
Equity securities - related party (see "Note 15 - Related Parties) | 2,200 | — | (541 | ) | 1,659 | ||||||||||||||
Total Securities available for sale | $ | 12,075 | $ | — | $ | (865 | ) | $ | 11,210 | ||||||||||
December 31, 2013 | |||||||||||||||||||
(in thousands) | |||||||||||||||||||
Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | ||||||||||||||||
Securities available for sale, carried at fair value: | |||||||||||||||||||
Equity securities | $ | 428 | $ | — | $ | (281 | ) | $ | 147 | ||||||||||
Equity securities - related party (see "Note 15 - Related Party Transactions") | 2,200 | — | (528 | ) | 1,672 | ||||||||||||||
Total Securities available for sale | $ | 2,628 | $ | — | $ | (809 | ) | $ | 1,819 | ||||||||||
Estimated fair values of commodity derivatives | ' | ||||||||||||||||||
As of March 31, 2014, the Company had the following commodity derivative instruments: | |||||||||||||||||||
Weighted Average | |||||||||||||||||||
Natural Gas | Period | MMBtu/day | Price per MMBtu | ||||||||||||||||
Collars (1) | April 2014- Dec 2014 | 5,000 | $4.00 - $5.25 | ||||||||||||||||
Swaps | April 2014 - Dec 2014 | 31,000 | $4.23 | ||||||||||||||||
Jan 2015 - Dec 2015 | 20,000 | $4.18 | |||||||||||||||||
Ceilings purchased (call) | April 2014 - Dec 2014 | 16,000 | $5.91 | ||||||||||||||||
Ceilings sold (call) | April 2014 - Dec 2014 | 16,000 | $5.91 | ||||||||||||||||
Weighted Average | |||||||||||||||||||
Crude Oil | Period | Bbl/day | Price per Bbl | ||||||||||||||||
Collars (1) | April 2014 - Dec 2014 | 663 | $85.00 - $91.25 | ||||||||||||||||
Jan 2015 - Dec 2015 | 259 | $85.00 - $91.25 | |||||||||||||||||
Traditional three-way collars (2) | April 2014 - Dec 2014 | 4,000 | $64.94 - $85.00 - $102.50 | ||||||||||||||||
Ceilings sold (call) | Jan 2015 - Dec 2015 | 1,570 | $120.00 | ||||||||||||||||
Floors sold (put) | April 2014 - Dec 2014 | 663 | $65.00 | ||||||||||||||||
Jan 2015 - Dec 2015 | 259 | $70.00 | |||||||||||||||||
________________________________ | |||||||||||||||||||
(1) A collar is a sold call and a purchased put. Some collars are "costless" collars with the premiums netting to approximately zero. | |||||||||||||||||||
(2) These three-way collars are a combination of three options: a sold call, a purchased put and a sold put. | |||||||||||||||||||
Schedule of fair value of commodity derivative contracts | ' | ||||||||||||||||||
The following table summarizes the fair value of the Company's commodity and financial derivative contracts as of the dates indicated: | |||||||||||||||||||
Derivative Assets | Derivative Liabilities | ||||||||||||||||||
Derivatives not designated as hedging instruments | Balance Sheet Classification | March 31, 2014 | December 31, 2013 | March 31, 2014 | December 31, 2013 | ||||||||||||||
(in thousands) | |||||||||||||||||||
Commodity | |||||||||||||||||||
Derivative assets | $ | — | $ | 529 | $ | — | $ | — | |||||||||||
Derivative assets - long-term | 585 | 25 | — | — | |||||||||||||||
Derivative liabilities | — | — | (5,276 | ) | (1,903 | ) | |||||||||||||
Derivative liabilities - long-term | — | — | (295 | ) | (376 | ) | |||||||||||||
Total commodity | $ | 585 | $ | 554 | $ | (5,571 | ) | $ | (2,279 | ) | |||||||||
Financial | |||||||||||||||||||
Derivative assets | $ | 35 | $ | 79 | $ | — | $ | — | |||||||||||
Derivative liabilities - long-term | — | — | (72,316 | ) | (75,934 | ) | |||||||||||||
Total financial | $ | 35 | $ | 79 | $ | (72,316 | ) | $ | (75,934 | ) | |||||||||
Total derivatives | $ | 620 | $ | 633 | $ | (77,887 | ) | $ | (78,213 | ) | |||||||||
Schedule of commodity derivatives and master netting arrangements | ' | ||||||||||||||||||
The tables below summarize the Company's commodity derivatives and the effect of master netting arrangements on the presentation in the Company's consolidated balance sheets as of: | |||||||||||||||||||
March 31, 2014 | |||||||||||||||||||
Gross Amounts of Recognized Assets and Liabilities | Gross Amounts Offset on the Consolidated Balance Sheet | Net Amount | |||||||||||||||||
(in thousands) | |||||||||||||||||||
Current assets: Fair value of derivative contracts | $ | 1,561 | 1,561 | $ | — | ||||||||||||||
Long-term assets: Fair value of derivative contracts | 928 | 343 | 585 | ||||||||||||||||
Current liabilities: Fair value of derivative contracts | (6,837 | ) | (1,561 | ) | (5,276 | ) | |||||||||||||
Long-term liabilities: Fair value of derivative contracts | (638 | ) | (343 | ) | (295 | ) | |||||||||||||
$ | (4,986 | ) | — | $ | (4,986 | ) | |||||||||||||
December 31, 2013 | |||||||||||||||||||
Gross Amounts of Assets and Liabilities | Gross Amounts Offset on the Consolidated Balance Sheet | Net Amount | |||||||||||||||||
(in thousands) | |||||||||||||||||||
Current assets: Fair value of derivative contracts | $ | 4,034 | 3,505 | $ | 529 | ||||||||||||||
Long-term assets: Fair value of derivative contracts | 516 | 491 | 25 | ||||||||||||||||
Current liabilities: Fair value of derivative contracts | (5,408 | ) | (3,505 | ) | (1,903 | ) | |||||||||||||
Long-term liabilities: Fair value of derivative contracts | (867 | ) | (491 | ) | (376 | ) | |||||||||||||
$ | (1,725 | ) | — | $ | (1,725 | ) | |||||||||||||
Schedule of the realized and unrealized gain (loss) on derivatives | ' | ||||||||||||||||||
The following table summarizes the net gain (loss) on all derivative contracts included in other income (expense) on the consolidated statements of operations for the three months ended March 31, 2014 and 2013: | |||||||||||||||||||
Three Months Ended March 31, | |||||||||||||||||||
2014 | 2013 | ||||||||||||||||||
(in thousands) | |||||||||||||||||||
Gain (loss) on settled transactions | $ | (2,284 | ) | $ | 956 | ||||||||||||||
Gain (loss) on open transactions | 2,631 | (8,447 | ) | ||||||||||||||||
Total gain (loss) | $ | 347 | $ | (7,491 | ) | ||||||||||||||
LONGTERM_DEBT_Tables
LONG-TERM DEBT (Tables) | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Debt Disclosure [Abstract] | ' | |||||||
Schedule of long-term debt | ' | |||||||
Long-term debt at March 31, 2014 and December 31, 2013 consisted of the following: | ||||||||
March 31, 2014 | December 31, 2013 | |||||||
(in thousands) | ||||||||
Senior Notes payable due May 15, 2020, interest rate of 9.75%, net of unamortized net discount of $2.8 million at March 31, 2014 and December 31, 2013 | $ | 597,251 | $ | 597,230 | ||||
Various equipment and real estate notes payable with maturity dates January 2015 - April 2021, interest rates of 4.25% - 7.94%(1) | 25,609 | 18,615 | ||||||
Eureka Hunter Pipeline Credit Agreement due March 28, 2018, interest rate of 5.75% | 55,000 | — | ||||||
Eureka Hunter Pipeline second lien term loan due August 16, 2018, interest rate of 12.5% | — | 50,000 | ||||||
MHR Senior Revolving Credit Facility due April 13, 2016, interest rate of 2.96% | 226,000 | 218,000 | ||||||
at March 31, 2014 and 3.56% at December 31, 2013 | ||||||||
903,860 | 883,845 | |||||||
Less: current portion | (9,986 | ) | (3,967 | ) | ||||
Total long-term debt obligations, net of current portion | $ | 893,874 | $ | 879,878 | ||||
Schedule of expected approximate annual maturities of debt | ' | |||||||
The following table presents the scheduled or expected approximate annual maturities of debt, gross of unamortized discount of $2.8 million: | ||||||||
(in thousands) | ||||||||
2014 | $ | 4,354 | ||||||
2015 | 9,989 | |||||||
2016 | 234,548 | |||||||
2017 | 2,358 | |||||||
2018 | 55,360 | |||||||
Thereafter | 600,000 | |||||||
Total | $ | 906,609 | ||||||
Schedule of Interest Expense | ' | |||||||
The following table sets forth interest expense for the three-month period ended March 31, 2014 and 2013, respectively: | ||||||||
Three Months Ended | ||||||||
March 31, | ||||||||
2014 | 2013 | |||||||
(in thousands) | ||||||||
Interest expense incurred on debt, net of amounts capitalized | $ | 20,228 | $ | 17,844 | ||||
Amortization and write-off of deferred financing costs | 3,621 | 857 | ||||||
Total Interest Expense | $ | 23,849 | $ | 18,701 | ||||
SHAREBASED_COMPENSATION_Tables
SHARE-BASED COMPENSATION (Tables) | 3 Months Ended | |||||||||||||
Mar. 31, 2014 | ||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ' | |||||||||||||
Summary of common stock option and stock appreciation rights | ' | |||||||||||||
A summary of common stock option activity for the three months ended March 31, 2014 and 2013 is presented below: | ||||||||||||||
Three Months Ended March 31, | ||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||
(in thousands of shares) | Weighted Average Exercise Price per Share | |||||||||||||
Outstanding at beginning of period | 16,891 | 14,847 | $ | 5.69 | $ | 6.01 | ||||||||
Granted | — | 4,363 | $ | — | $ | 4.16 | ||||||||
Exercised | (597 | ) | — | $ | 6.67 | $ | — | |||||||
Forfeited | (902 | ) | (225 | ) | $ | 6.37 | $ | 7.37 | ||||||
Outstanding at end of period | 15,392 | 18,985 | $ | 5.61 | $ | 5.57 | ||||||||
Exercisable at end of period | 10,003 | 9,946 | $ | 5.74 | $ | 5.65 | ||||||||
Summary of non-vested shares | ' | |||||||||||||
A summary of the Company’s non-vested common stock options and stock appreciation rights for the three months ended March 31, 2014 and 2013 is presented below: | ||||||||||||||
Three Months Ended March 31, | ||||||||||||||
2014 | 2013 | |||||||||||||
(in thousands of shares) | ||||||||||||||
Non-vested at beginning of period | 6,908 | 6,163 | ||||||||||||
Granted | — | 4,363 | ||||||||||||
Vested | (805 | ) | (1,482 | ) | ||||||||||
Forfeited | (714 | ) | (6 | ) | ||||||||||
Non-vested at end of period | 5,389 | 9,038 | ||||||||||||
SHAREHOLDERS_EQUITY_Tables
SHAREHOLDERS' EQUITY (Tables) | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Equity [Abstract] | ' | |||||||
Schedule of dividends paid | ' | |||||||
A summary of the Company's preferred dividends for the three months ended March 31, 2014 and 2013 is presented below: | ||||||||
Three Months Ended March 31, | ||||||||
2014 | 2013 | |||||||
(in thousands) | ||||||||
Dividend on Eureka Hunter Holdings Series A Preferred Units | $ | 4,028 | $ | 3,114 | ||||
Accretion of the carrying value of the Eureka Hunter Holdings Series A Preferred Units | 2,048 | 1,468 | ||||||
Dividend on Series C Preferred Stock | 2,562 | 2,562 | ||||||
Dividend on Series D Preferred Stock | 4,424 | 4,382 | ||||||
Dividend on Series E Preferred Stock | 1,834 | 1,962 | ||||||
Total dividends on Preferred Stock | $ | 14,896 | $ | 13,488 | ||||
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | ' | |||||||
The following table summarizes the types of potentially dilutive securities outstanding as of March 31, 2014 and 2013: | ||||||||
March 31, | ||||||||
2014 | 2013 | |||||||
(in thousands of shares) | ||||||||
Series E Preferred Stock | 10,946 | 10,946 | ||||||
Warrants | 17,071 | 13,376 | ||||||
Restricted shares granted, not yet issued | 1,453 | — | ||||||
Common stock options and stock appreciations rights | 15,392 | 18,985 | ||||||
Total | 44,862 | 43,307 | ||||||
TAXES_Tables
TAXES (Tables) | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Income Tax Disclosure [Abstract] | ' | |||||||
Schedule of Components of Income Tax Expense (Benefit) | ' | |||||||
The Company's income tax benefit from continuing operations for the three months ended March 31, 2014 and 2013 was: | ||||||||
Three Months Ended March 31, | ||||||||
2014 | 2013 | |||||||
(in thousands) | ||||||||
Deferred | — | 4,899 | ||||||
Income tax benefit | $ | — | $ | 4,899 | ||||
RELATED_PARTY_TRANSACTIONS_REL
RELATED PARTY TRANSACTIONS RELATED PARTY TRANSACTIONS (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Related Party Transactions [Abstract] | ' | ||||||||
Schedule of Related Party Balances | ' | ||||||||
The following table sets forth the related party balances as of March 31, 2014 and December 31, 2013: | |||||||||
March 31, 2014 | December 31, 2013 | ||||||||
(in thousands) | |||||||||
Green Hunter (1) | |||||||||
Accounts payable - net | $ | 451 | $ | 23 | |||||
Derivative assets (2) | $ | 35 | $ | 79 | |||||
Investments (2) | $ | 2,027 | $ | 2,262 | |||||
Notes receivable (2) | $ | 1,632 | $ | 1,768 | |||||
Prepaid expenses | $ | — | $ | 9 | |||||
Schedule of Related Party Transactions | ' | ||||||||
The following table sets forth the related party transaction activities for the three months ended March 31, 2014 and 2013, respectively: | |||||||||
Three Months Ended | |||||||||
March 31, | |||||||||
2014 | 2013 | ||||||||
(in thousands) | |||||||||
GreenHunter | |||||||||
Salt water disposal (1) | $ | 322 | $ | 856 | |||||
Equipment rental (1) | 122 | — | |||||||
Office space rental (1) | 22 | — | |||||||
Interest Income from Note Receivable (2) | 45 | 55 | |||||||
Dividends earned from Series C shares | 55 | — | |||||||
Loss on investments (2) | 235 | 526 | |||||||
Pilatus Hunter, LLC | |||||||||
Airplane rental expenses (3) | 70 | 47 | |||||||
_________________________________ | |||||||||
-1 | GreenHunter is an entity of which Gary C. Evans, the Company's Chairman and CEO, is the Chairman, a major shareholder and interim CEO; of which David Krueger, the Company's former Chief Accounting Officer and Senior Vice President, is the former Chief Financial Officer; and of which Ronald D. Ormand, the Company’s former Chief Financial Officer and Executive Vice President, is a former director. Eagle Ford Hunter received, and Triad Hunter and Viking International Resources, Inc., wholly-owned subsidiaries of the Company, receive services related to brine water and rental equipment from GreenHunter and its affiliated companies, White Top Oilfield Construction, LLC and Black Water Services, LLC. The Company believes that such services were and are provided at competitive market rates and were and are comparable to, or more attractive than, rates that could be obtained from unaffiliated third party suppliers of such services. | ||||||||
-2 | On February 17, 2012, the Company sold its wholly-owned subsidiary, Hunter Disposal, to GreenHunter Water, LLC ("GreenHunter Water"), a wholly-owned subsidiary of GreenHunter. The Company recognized an embedded derivative asset resulting from the conversion option under the convertible promissory note it received as partial consideration for the sale. See "Note 8 - Fair Value of Financial Instruments" for additional information. The Company has recorded interest income as a result of the note receivable from GreenHunter. Also as a result of this transaction, the Company has an equity method investment in GreenHunter that is included in derivatives and other long-term assets and an available for sale investment in GreenHunter included in investments. | ||||||||
-3 | The Company rented an airplane for business use for certain members of Company management at various times from Pilatus Hunter, LLC, an entity 100% owned by Mr. Evans. Airplane rental expenses are recorded in general and administrative expense. |
SUPPLEMENTAL_CASH_FLOW_INFORMA1
SUPPLEMENTAL CASH FLOW INFORMATION (Tables) | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Supplemental Cash Flow Elements [Abstract] | ' | |||||||
Schedule of Cash Flow, Supplemental Disclosures | ' | |||||||
The following table summarizes cash paid (received) for interest and income taxes, as well as non-cash investing transactions: | ||||||||
Three Months Ended March 31, | ||||||||
2014 | 2013 | |||||||
(in thousands) | ||||||||
Cash paid for interest | $ | 3,660 | $ | 3,928 | ||||
Non-cash transactions | ||||||||
Non-cash consideration received from sale of assets | $ | 9,400 | $ | — | ||||
Change in accrued capital expenditures | $ | 55,396 | $ | 9,377 | ||||
Non-cash additions to asset retirement obligation | $ | 52 | $ | 1,964 | ||||
Eureka Hunter Holdings Series A Preferred Unit dividends paid in kind | $ | 1,900 | $ | 2,253 | ||||
SEGMENT_REPORTING_Tables
SEGMENT REPORTING (Tables) | 3 Months Ended | |||||||||||||||||||||||||||
Mar. 31, 2014 | ||||||||||||||||||||||||||||
Segment Reporting [Abstract] | ' | |||||||||||||||||||||||||||
Details of operating activities by segment | ' | |||||||||||||||||||||||||||
The following tables set forth operating activities by segment for the three months ended March 31, 2014 and 2013, respectively. | ||||||||||||||||||||||||||||
As of and for the Three Months Ended March 31, 2014 | ||||||||||||||||||||||||||||
U.S. | Canadian | Midstream and Marketing | Oilfield | Corporate | Inter-segment | Total | ||||||||||||||||||||||
Upstream | Upstream | Services | Unallocated | Eliminations | ||||||||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||||||
Total revenue | $ | 70,174 | $ | — | $ | 34,735 | $ | 7,911 | $ | — | $ | (5,376 | ) | $ | 107,444 | |||||||||||||
Depletion, depreciation, amortization and accretion | 24,939 | — | 3,678 | 791 | — | — | 29,408 | |||||||||||||||||||||
Loss on sale of assets, net | 3,457 | — | — | 2 | — | — | 3,459 | |||||||||||||||||||||
Other operating expenses | 44,729 | — | 32,070 | 6,713 | 10,488 | (5,223 | ) | 88,777 | ||||||||||||||||||||
Other income (expense) | (278 | ) | — | 30 | (209 | ) | (23,244 | ) | — | (23,701 | ) | |||||||||||||||||
Loss from continuing operations before income tax | (3,229 | ) | — | (983 | ) | 196 | (33,732 | ) | (153 | ) | (37,901 | ) | ||||||||||||||||
Total income (loss) from discontinued operations, net of tax | (23,128 | ) | (825 | ) | — | — | — | 153 | (23,800 | ) | ||||||||||||||||||
Net income (loss) | $ | (26,357 | ) | $ | (825 | ) | $ | (983 | ) | $ | 196 | $ | (33,732 | ) | $ | — | $ | (61,701 | ) | |||||||||
Total assets | $ | 1,369,962 | $ | 64,147 | $ | 322,030 | $ | 45,021 | $ | 98,526 | $ | (5,833 | ) | $ | 1,893,853 | |||||||||||||
Total capital expenditures | $ | 66,311 | $ | 308 | $ | 30,634 | $ | 690 | $ | 23 | $ | — | $ | 97,966 | ||||||||||||||
As of and for the Three Months Ended March 31, 2013 | ||||||||||||||||||||||||||||
U.S. | Canadian | Midstream and Marketing | Oilfield | Corporate | Inter-segment | Total | ||||||||||||||||||||||
Upstream | Upstream | Services | Unallocated | Eliminations | ||||||||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||||||
Total revenue | $ | 34,645 | $ | — | $ | 17,302 | $ | 3,731 | $ | — | $ | (1,444 | ) | $ | 54,234 | |||||||||||||
Depletion, depreciation, amortization and accretion | 14,263 | — | 2,687 | 338 | — | — | 17,288 | |||||||||||||||||||||
(Gain) loss on sale of assets, net | (19 | ) | — | — | — | — | — | (19 | ) | |||||||||||||||||||
Other operating expenses | 44,063 | — | 14,668 | 3,699 | 15,990 | (1,444 | ) | 76,976 | ||||||||||||||||||||
Other income (expense) | (2,123 | ) | — | (1,095 | ) | (89 | ) | (23,126 | ) | 82 | (26,351 | ) | ||||||||||||||||
Loss from continuing operations before income tax | (25,785 | ) | — | (1,148 | ) | (395 | ) | (39,116 | ) | 82 | (66,362 | ) | ||||||||||||||||
Income tax benefit | 4,854 | — | — | — | 45 | — | 4,899 | |||||||||||||||||||||
Total income from discontinued operations, net of tax | 16,489 | 356 | — | — | — | (82 | ) | 16,763 | ||||||||||||||||||||
Net income (loss) | $ | (4,442 | ) | $ | 356 | $ | (1,148 | ) | $ | (395 | ) | $ | (39,071 | ) | $ | — | $ | (44,700 | ) | |||||||||
Total assets | $ | 1,658,324 | $ | 262,320 | $ | 240,861 | $ | 29,121 | $ | 125,233 | $ | (1,930 | ) | $ | 2,313,929 | |||||||||||||
Total capital expenditures | $ | 112,344 | $ | 12,256 | $ | 22,295 | $ | 7,956 | $ | 172 | $ | — | $ | 155,023 | ||||||||||||||
CONDENSED_CONSOLIDATING_GUARAN1
CONDENSED CONSOLIDATING GUARANTOR FINANCIAL STATEMENTS (Tables) | 3 Months Ended | |||||||||||||||||||
Mar. 31, 2014 | ||||||||||||||||||||
Condensed Financial Statements, Captions [Line Items] | ' | |||||||||||||||||||
Schedule of Comprehensive Income (Loss) | ' | |||||||||||||||||||
Magnum Hunter Resources Corporation and Subsidiaries | ||||||||||||||||||||
Condensed Consolidating Statements of Comprehensive Income (Loss) | ||||||||||||||||||||
(in thousands) | ||||||||||||||||||||
Three Months Ended March 31, 2014 | ||||||||||||||||||||
Magnum Hunter | 100% Owned Guarantor | Non Guarantor | Consolidating/ Eliminating Adjustments | Magnum Hunter | ||||||||||||||||
Resources | Subsidiaries | Subsidiaries | Resources | |||||||||||||||||
Corporation | Corporation | |||||||||||||||||||
Consolidated | ||||||||||||||||||||
Net income (loss) | $ | (67,819 | ) | $ | (21,681 | ) | $ | (861 | ) | $ | 28,660 | (61,701 | ) | |||||||
Foreign currency translation loss | — | — | (2,348 | ) | — | (2,348 | ) | |||||||||||||
Unrealized gain (loss) on available for sale securities | — | (56 | ) | — | — | (56 | ) | |||||||||||||
Comprehensive income (loss) | (67,819 | ) | (21,737 | ) | (3,209 | ) | 28,660 | (64,105 | ) | |||||||||||
Comprehensive loss attributable to non-controlling interest | — | — | — | 109 | 109 | |||||||||||||||
Comprehensive income (loss) attributable to Magnum Hunter Resources Corporation | $ | (67,819 | ) | $ | (21,737 | ) | $ | (3,209 | ) | $ | 28,769 | (63,996 | ) | |||||||
Three Months Ended March 31, 2013 | ||||||||||||||||||||
Magnum Hunter | 100% Owned Guarantor | Non Guarantor | Consolidating/ Eliminating Adjustments | Magnum Hunter | ||||||||||||||||
Resources | Subsidiaries | Subsidiaries | Resources | |||||||||||||||||
Corporation | Corporation | |||||||||||||||||||
Consolidated | ||||||||||||||||||||
Net income (loss) | $ | (48,845 | ) | $ | (20,095 | ) | $ | 6,823 | $ | 17,417 | (44,700 | ) | ||||||||
Foreign currency translation loss | — | — | (4,729 | ) | — | (4,729 | ) | |||||||||||||
Unrealized gain (loss) on available for sale securities | — | (17 | ) | — | — | (17 | ) | |||||||||||||
Comprehensive income (loss) | (48,845 | ) | (20,112 | ) | 2,094 | 17,417 | (49,446 | ) | ||||||||||||
Comprehensive income attributable to non-controlling interest | — | — | — | 503 | 503 | |||||||||||||||
Comprehensive income (loss) attributable to Magnum Hunter Resources Corporation | $ | (48,845 | ) | (20,112 | ) | 2,094 | 17,920 | (48,943 | ) | |||||||||||
Debt Securities Under Universal Shelf Registration Statement Form S-4 | ' | |||||||||||||||||||
Condensed Financial Statements, Captions [Line Items] | ' | |||||||||||||||||||
Schedule of condensed consolidating balance sheets | ' | |||||||||||||||||||
Magnum Hunter Resources Corporation and Subsidiaries | ||||||||||||||||||||
Condensed Consolidating Balance Sheets | ||||||||||||||||||||
(in thousands) | ||||||||||||||||||||
As of March 31, 2014 | ||||||||||||||||||||
Magnum Hunter | 100% Owned Guarantor | Non Guarantor | Consolidating/ Eliminating Adjustments | Magnum Hunter | ||||||||||||||||
Resources | Subsidiaries | Subsidiaries | Resources | |||||||||||||||||
Corporation | Corporation | |||||||||||||||||||
Consolidated | ||||||||||||||||||||
ASSETS | ||||||||||||||||||||
Current assets | $ | 75,046 | $ | 64,639 | $ | 22,320 | $ | (5,833 | ) | $ | 156,172 | |||||||||
Intercompany accounts receivable | 953,626 | — | — | (953,626 | ) | — | ||||||||||||||
Property and equipment (using successful efforts method of accounting) | 6,362 | 1,269,856 | 262,267 | — | 1,538,485 | |||||||||||||||
Investment in subsidiaries | 347,169 | 102,469 | — | (449,638 | ) | — | ||||||||||||||
Assets held for sale and other | 17,118 | 86,675 | 95,403 | — | 199,196 | |||||||||||||||
Total Assets | $ | 1,399,321 | $ | 1,523,639 | $ | 379,990 | $ | (1,409,097 | ) | $ | 1,893,853 | |||||||||
LIABILITIES AND SHAREHOLDERS' EQUITY | ||||||||||||||||||||
Current liabilities | $ | 76,184 | $ | 131,868 | $ | 47,832 | $ | (5,868 | ) | $ | 250,016 | |||||||||
Intercompany accounts payable | — | 911,751 | 41,843 | (953,594 | ) | — | ||||||||||||||
Long-term liabilities | 826,507 | 40,506 | 128,879 | — | 995,892 | |||||||||||||||
Redeemable preferred stock | 100,000 | — | 142,275 | — | 242,275 | |||||||||||||||
Shareholders' equity (deficit) | 396,630 | 439,514 | 19,161 | (449,635 | ) | 405,670 | ||||||||||||||
Total Liabilities and Shareholders' Equity | $ | 1,399,321 | $ | 1,523,639 | $ | 379,990 | $ | (1,409,097 | ) | $ | 1,893,853 | |||||||||
Magnum Hunter Resources Corporation and Subsidiaries | ||||||||||||||||||||
Condensed Consolidating Balance Sheets | ||||||||||||||||||||
(in thousands) | ||||||||||||||||||||
As of December 31, 2013 | ||||||||||||||||||||
Magnum Hunter | 100% Owned Guarantor | Non Guarantor | Consolidating/ Eliminating Adjustments | Magnum Hunter | ||||||||||||||||
Resources | Subsidiaries | Subsidiaries | Resources | |||||||||||||||||
Corporation | Corporation | |||||||||||||||||||
Consolidated | ||||||||||||||||||||
ASSETS | ||||||||||||||||||||
Current assets | $ | 53,161 | $ | 43,841 | $ | 27,096 | $ | (3,372 | ) | $ | 120,726 | |||||||||
Intercompany accounts receivable | 965,138 | — | — | (965,138 | ) | — | ||||||||||||||
Property and equipment (using successful efforts method of accounting) | 7,214 | 1,272,027 | 234,838 | — | 1,514,079 | |||||||||||||||
Investment in subsidiaries | 372,236 | 102,314 | — | (474,550 | ) | — | ||||||||||||||
Other assets | 17,308 | 100,894 | 103,644 | — | 221,846 | |||||||||||||||
Total Assets | $ | 1,415,057 | $ | 1,519,076 | $ | 365,578 | $ | (1,443,060 | ) | $ | 1,856,651 | |||||||||
LIABILITIES AND SHAREHOLDERS' EQUITY | ||||||||||||||||||||
Current liabilities | $ | 54,826 | $ | 97,520 | $ | 34,929 | $ | (3,410 | ) | $ | 183,865 | |||||||||
Intercompany accounts payable | — | 921,237 | 43,866 | (965,103 | ) | — | ||||||||||||||
Long-term liabilities | 818,651 | 39,067 | 127,663 | — | 985,381 | |||||||||||||||
Redeemable preferred stock | 100,000 | — | 136,675 | — | 236,675 | |||||||||||||||
Shareholders' equity (deficit) | 441,580 | 461,252 | 22,445 | (474,547 | ) | 450,730 | ||||||||||||||
Total Liabilities and Shareholders' Equity | $ | 1,415,057 | $ | 1,519,076 | $ | 365,578 | $ | (1,443,060 | ) | $ | 1,856,651 | |||||||||
Schedule of condensed consolidating statements of operations | ' | |||||||||||||||||||
Magnum Hunter Resources Corporation and Subsidiaries | ||||||||||||||||||||
Condensed Consolidating Statements of Operations | ||||||||||||||||||||
(in thousands) | ||||||||||||||||||||
Three Months Ended March 31, 2014 | ||||||||||||||||||||
Magnum Hunter | 100% Owned Guarantor | Non Guarantor | Consolidating/ Eliminating Adjustments | Magnum Hunter | ||||||||||||||||
Resources | Subsidiaries | Subsidiaries | Resources | |||||||||||||||||
Corporation | Corporation | |||||||||||||||||||
Consolidated | ||||||||||||||||||||
Revenues | $ | 108 | $ | 104,014 | $ | 8,698 | $ | (5,376 | ) | $ | 107,444 | |||||||||
Expenses | 34,793 | 107,084 | 8,692 | (5,224 | ) | 145,345 | ||||||||||||||
Loss from continuing operations before equity in net income of subsidiaries | (34,685 | ) | (3,070 | ) | 6 | (152 | ) | (37,901 | ) | |||||||||||
Equity in net income of subsidiaries | (28,815 | ) | 155 | — | 28,660 | — | ||||||||||||||
Loss from continuing operations before income tax | (63,500 | ) | (2,915 | ) | 6 | 28,508 | (37,901 | ) | ||||||||||||
Income tax benefit (expense) | — | — | — | — | — | |||||||||||||||
Loss from continuing operations | (63,500 | ) | (2,915 | ) | 6 | 28,508 | (37,901 | ) | ||||||||||||
Income from discontinued operations, net of tax | — | (117 | ) | 3,327 | 152 | 3,362 | ||||||||||||||
Gain on sale of discontinued operations, net of tax | (4,319 | ) | (18,649 | ) | (4,194 | ) | — | (27,162 | ) | |||||||||||
Net income (loss) | (67,819 | ) | (21,681 | ) | (861 | ) | 28,660 | (61,701 | ) | |||||||||||
Net loss attributable to non-controlling interest | — | — | — | 109 | 109 | |||||||||||||||
Net loss attributable to Magnum Hunter Resources Corporation | (67,819 | ) | (21,681 | ) | (861 | ) | 28,769 | (61,592 | ) | |||||||||||
Dividends on preferred stock | (8,820 | ) | — | (6,076 | ) | — | (14,896 | ) | ||||||||||||
Net income (loss) attributable to common shareholders | $ | (76,639 | ) | $ | (21,681 | ) | $ | (6,937 | ) | $ | 28,769 | $ | (76,488 | ) | ||||||
Magnum Hunter Resources Corporation and Subsidiaries | ||||||||||||||||||||
Condensed Consolidating Statements of Operations | ||||||||||||||||||||
(in thousands) | ||||||||||||||||||||
Three Months Ended March 31, 2013 | ||||||||||||||||||||
Magnum Hunter | 100% Owned Guarantor | Non Guarantor | Consolidating/ Eliminating Adjustments | Magnum Hunter | ||||||||||||||||
Resources | Subsidiaries | Subsidiaries | Resources | |||||||||||||||||
Corporation | Corporation | |||||||||||||||||||
Consolidated | ||||||||||||||||||||
Revenues | $ | (175 | ) | $ | 47,362 | $ | 8,491 | $ | (1,444 | ) | $ | 54,234 | ||||||||
Expenses | 39,632 | 71,673 | 10,817 | (1,526 | ) | 120,596 | ||||||||||||||
Income (loss) from continuing operations before equity in net income of subsidiaries | (39,807 | ) | (24,311 | ) | (2,326 | ) | 82 | (66,362 | ) | |||||||||||
Equity in net income of subsidiaries | (9,083 | ) | (529 | ) | (7,805 | ) | 17,417 | — | ||||||||||||
Income (loss) from continuing operations before income tax | (48,890 | ) | (24,840 | ) | (10,131 | ) | 17,499 | (66,362 | ) | |||||||||||
Income tax benefit | 45 | 4,854 | — | — | 4,899 | |||||||||||||||
Income (loss) from continuing operations | (48,845 | ) | (19,986 | ) | (10,131 | ) | 17,499 | (61,463 | ) | |||||||||||
Income from discontinued operations, net of tax | — | (109 | ) | 16,954 | (82 | ) | 16,763 | |||||||||||||
Gain on sale of discontinued operations, net of tax | — | — | — | — | — | |||||||||||||||
Net income (loss) | (48,845 | ) | (20,095 | ) | 6,823 | 17,417 | (44,700 | ) | ||||||||||||
Net income attributable to non-controlling interest | — | — | — | 503 | 503 | |||||||||||||||
Net income (loss) attributable to Magnum Hunter Resources Corporation | (48,845 | ) | (20,095 | ) | 6,823 | 17,920 | (44,197 | ) | ||||||||||||
Dividends on preferred stock | (8,906 | ) | — | (4,582 | ) | — | (13,488 | ) | ||||||||||||
Net income (loss) attributable to common shareholders | $ | (57,751 | ) | $ | (20,095 | ) | $ | 2,241 | $ | 17,920 | $ | (57,685 | ) | |||||||
Schedule of condensed consolidating statements of cash flows | ' | |||||||||||||||||||
Magnum Hunter Resources Corporation and Subsidiaries | ||||||||||||||||||||
Condensed Consolidating Statements of Cash Flows | ||||||||||||||||||||
(in thousands) | ||||||||||||||||||||
Three Months Ended March 31, 2014 | ||||||||||||||||||||
Magnum Hunter | 100% Owned Guarantor | Non Guarantor | Consolidating/ Eliminating Adjustments | Magnum Hunter | ||||||||||||||||
Resources | Subsidiaries | Subsidiaries | Resources | |||||||||||||||||
Corporation | Corporation | |||||||||||||||||||
Consolidated | ||||||||||||||||||||
Cash flow from operating activities | $ | (8,779 | ) | $ | 4,611 | $ | 8,045 | $ | — | $ | 3,877 | |||||||||
Cash flow from investing activities | (181 | ) | (4,070 | ) | (18,568 | ) | — | (22,819 | ) | |||||||||||
Cash flow from financing activities | 31,886 | 4,050 | 5,720 | — | 41,656 | |||||||||||||||
Effect of exchange rate changes on cash | — | — | 25 | — | 25 | |||||||||||||||
Net increase (decrease) in cash | 22,926 | 4,591 | (4,778 | ) | — | 22,739 | ||||||||||||||
Cash at beginning of period | 47,895 | (17,651 | ) | 11,469 | — | 41,713 | ||||||||||||||
Cash at end of period | $ | 70,821 | $ | (13,060 | ) | $ | 6,691 | $ | — | $ | 64,452 | |||||||||
Three Months Ended March 31, 2013 | ||||||||||||||||||||
Magnum Hunter | 100% Owned Guarantor | Non Guarantor | Consolidating/ Eliminating Adjustments | Magnum Hunter | ||||||||||||||||
Resources | Subsidiaries | Subsidiaries | Resources | |||||||||||||||||
Corporation | Corporation | |||||||||||||||||||
Consolidated | ||||||||||||||||||||
Cash flow from operating activities | $ | (33,357 | ) | $ | 89,742 | $ | 22,072 | $ | (836 | ) | $ | 77,621 | ||||||||
Cash flow from investing activities | (142 | ) | (89,577 | ) | (54,718 | ) | — | (144,437 | ) | |||||||||||
Cash flow from financing activities | 100,852 | 402 | (864 | ) | — | 100,390 | ||||||||||||||
Effect of exchange rate changes on cash | — | — | (21 | ) | — | (21 | ) | |||||||||||||
Net increase (decrease) in cash | 67,353 | 567 | (33,531 | ) | (836 | ) | 33,553 | |||||||||||||
Cash at beginning of period | 26,871 | (12,582 | ) | 43,334 | — | 57,623 | ||||||||||||||
Cash at end of period | $ | 94,224 | $ | (12,015 | ) | $ | 9,803 | $ | (836 | ) | $ | 91,176 | ||||||||
GENERAL_Details
GENERAL (Details) (USD $) | Mar. 31, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 |
PRC Williston, LLC (PRC) | Eureka Hunter Holdings, LLC | Eureka Hunter Holdings, LLC | Energy Hunter Securities, Inc. (EHS) | Energy Hunter Securities, Inc. (EHS) | Eureka Hunter Pipeline, LLC | Trans Tex Hunter LLC | Eureka Hunter Land, LLC | Sentra Corporation | |
Summary of Significant Accounting Policies [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Consolidated controlling interest (as a percent) | 87.50% | 55.79% | 56.40% | ' | ' | ' | ' | ' | ' |
Consolidated entities ownership percentage in entity (as a percent) | ' | ' | ' | ' | ' | 100.00% | 100.00% | 100.00% | ' |
Minimum Net Capital Required for Broker-Dealer Subsidiary | ' | ' | ' | $5,000 | ' | ' | ' | ' | ' |
Ratio of Indebtedness to Net Capital | ' | ' | ' | 0.067 | ' | ' | ' | ' | ' |
Net capital | ' | ' | ' | 90,610 | 77,953 | ' | ' | ' | ' |
Aggregate indebtedness | ' | ' | ' | 4,000 | 16,657 | ' | ' | ' | ' |
Regulated Operating Revenue, Gas | ' | ' | ' | ' | ' | ' | ' | ' | $171,072 |
DIVESTITURES_AND_DISCONTINUED_2
DIVESTITURES AND DISCONTINUED OPERATIONS (Details) (USD $) | 3 Months Ended | 12 Months Ended | 3 Months Ended | |||
Mar. 31, 2014 | Mar. 31, 2013 | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2014 | Mar. 31, 2014 | |
Magnum Hunter Production and Williston Hunter Canada | Magnum Hunter Production and Williston Hunter Canada | Magnum Hunter Production, Inc. | Eagle Ford Hunter, Inc. | |||
Results reclassified to discontinued operations | ' | ' | ' | ' | ' | ' |
Revenues | $12,283,000 | $43,790,000 | ' | ' | ' | ' |
Expenses | -8,833,000 | -28,225,000 | ' | ' | ' | ' |
Other income (expense) | -88,000 | 1,243,000 | ' | ' | ' | ' |
Income tax expense | 0 | -45,000 | ' | ' | ' | ' |
Income from discontinued operations, net of tax | 3,362,000 | 16,763,000 | ' | ' | ' | ' |
Loss on disposal of discontinued operations, net of tax | -27,162,000 | 0 | ' | ' | -84,500,000 | 172,500,000 |
Income from discontinued operations, net of taxes | -23,800,000 | 16,763,000 | ' | ' | ' | ' |
Impairment expense from discontinued operations | ' | ' | $22,800,000 | $92,400,000 | ' | ' |
DIVESTITURES_AND_DISCONTINUED_3
DIVESTITURES AND DISCONTINUED OPERATIONS (Sale of Eagle Ford Hunter) (Details) (USD $) | 3 Months Ended | 1 Months Ended | 3 Months Ended | ||||
Mar. 31, 2014 | Mar. 31, 2013 | Apr. 24, 2013 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | Apr. 24, 2013 | |
Eagle Ford Hunter, Inc. | Eagle Ford Hunter, Inc. | Minimum | Maximum | Penn Virginia [Member] | |||
Eagle Ford Hunter, Inc. | Eagle Ford Hunter, Inc. | Eagle Ford Hunter, Inc. | |||||
Discontinued operations | ' | ' | ' | ' | ' | ' | ' |
Total consideration received | ' | ' | $422,100,000 | ' | ' | ' | ' |
Cash consideration received | ' | ' | 379,800,000 | ' | ' | ' | ' |
Consideration received, number of shares of common stock received | ' | ' | ' | ' | ' | ' | 10,000,000 |
Consideration received, value of common stock received | ' | ' | ' | ' | ' | ' | 42,300,000 |
Sale of Stock, Price Per Share | ' | ' | ' | ' | ' | ' | $4.23 |
Loss on disposal of discontinued operations, net of tax | -27,162,000 | 0 | ' | 172,500,000 | ' | ' | ' |
Discontinued Operation, Amount of Adjustment to Prior Period Gain (Loss) on Disposal, Net of Tax | ' | ' | ' | ' | $22,000,000 | $33,000,000 | ' |
DIVESTITURES_AND_DISCONTINUED_4
DIVESTITURES AND DISCONTINUED OPERATIONS DIVESTITURES AND DISCONTINUED OPERATIONS (Assets and Liabilities Held for Sale) (Details) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Assets and Liabilities Held for Sale [Abstract] | ' | ' |
Other long-term assets | $142,349 | $162,687 |
Total liabilities held for sale | 20,159 | 12,865 |
MHP and WHI Canada [Member] | ' | ' |
Assets and Liabilities Held for Sale [Abstract] | ' | ' |
Accounts receivable | 3,947 | 4,362 |
Other current assets | 1,071 | 1,004 |
Oil and natural gas properties, net | 127,068 | 150,770 |
Gas transportation, gathering, and processing equipment and other, net | 15,099 | 11,721 |
Other long-term assets | 182 | 196 |
Total assets held for sale | 147,367 | 168,053 |
Accounts payable | 10,215 | 7,292 |
Accrued expenses and other liabilities | 9,944 | 5,573 |
Asset retirement obligations | 8,485 | 8,678 |
Other long-term liabilities | 4,498 | 5,845 |
Total liabilities held for sale | $33,142 | $27,388 |
DIVESTITURES_AND_DISCONTINUED_5
DIVESTITURES AND DISCONTINUED OPERATIONS DIVESTITURES AND DISCONTINUED OPERATIONS (Sale of Certain Eagle Ford Shale Assets) (Details) (Eagle Ford Shale Assets [Member], USD $) | 0 Months Ended |
In Millions, except Share data, unless otherwise specified | Jan. 28, 2014 |
Discontinued operations | ' |
Cash consideration received | $15.50 |
Loss on the sale of assets | 4.5 |
Leasehold Acreage, Atascosa County, Texas [Member] | ' |
Discontinued operations | ' |
Number of horizontal oil and gas wells | 5 |
Number of horizontal oil and gas wells operated by Magnum Hunter Resources | 4 |
New Standard Energy Texas LLC [Member] | ' |
Discontinued operations | ' |
Consideration received, number of shares of common stock received | 65,650,000 |
Consideration received, value of common stock received | 9.4 |
Sale of Stock, Price Per Share | $0.14 |
Investment holding of total shares outstanding as a percent | 17.00% |
MHR Senior Revolving Credit Facility | ' |
Discontinued operations | ' |
Reduction in borrowing base | 10 |
Borrowing base | $232.50 |
OIL_NATURAL_GAS_SALES_Details
OIL & NATURAL GAS SALES (Details) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Oil and Gas In Process Activities [Line Items] | ' | ' |
Oil and Gas Sales Revenue | $70,172 | $34,641 |
Oil | ' | ' |
Oil and Gas In Process Activities [Line Items] | ' | ' |
Oil and Gas Sales Revenue | 34,272 | 25,572 |
Natural Gas | ' | ' |
Oil and Gas In Process Activities [Line Items] | ' | ' |
Oil and Gas Sales Revenue | 24,130 | 8,453 |
NGLs | ' | ' |
Oil and Gas In Process Activities [Line Items] | ' | ' |
Oil and Gas Sales Revenue | $11,770 | $616 |
PROPERTY_PLANT_EQUIPMENT_Detai
PROPERTY, PLANT, & EQUIPMENT (Details) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2014 | Mar. 31, 2013 |
Proved Oil and Natural Gas Properties [Member] | Proved Oil and Natural Gas Properties [Member] | |||
Mineral interests in properties: | ' | ' | ' | ' |
Unproved leasehold costs | $455,772,000 | $469,337,000 | ' | ' |
Proved leasehold costs | 335,124,000 | 336,357,000 | ' | ' |
Wells and related equipment and facilities | 570,133,000 | 536,023,000 | ' | ' |
Advances to operators for wells in progress | 12,388,000 | 13,571,000 | ' | ' |
Total costs | 1,373,417,000 | 1,355,288,000 | ' | ' |
Less accumulated depreciation | -152,119,000 | -130,629,000 | ' | ' |
Net capitalized costs | 1,221,298,000 | 1,224,659,000 | ' | ' |
Depreciation, depletion and amortization | ' | ' | $23,900,000 | $13,000,000 |
PROPERTY_PLANT_EQUIPMENT_Explo
PROPERTY, PLANT, & EQUIPMENT (Exploration) (Details) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Property, Plant and Equipment [Line Items] | ' | ' |
Leasehold impairments | $13,655 | $29,353 |
Geological and geophysical | 374 | 380 |
Total exploration expense | 14,029 | 29,733 |
Williston Basin [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Leasehold impairments | 11,085 | 29,353 |
Appalachian Basin [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Leasehold impairments | $2,570 | ' |
PROPERTY_PLANT_EQUIPMENT_Capit
PROPERTY, PLANT, & EQUIPMENT (Capitalized costs of oil and gas properties) (Details) (USD $) | 3 Months Ended | ||
Mar. 31, 2014 | Mar. 31, 2013 | Dec. 31, 2013 | |
Property, Plant and Equipment [Line Items] | ' | ' | ' |
Capitalized costs, gross | $1,373,417,000 | ' | $1,355,288,000 |
Less accumulated depreciation | -152,119,000 | ' | -130,629,000 |
Net capitalized costs | 1,221,298,000 | ' | 1,224,659,000 |
Gas transportation, gathering and processing equipment and other | ' | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' | ' |
Capitalized costs, gross | 347,995,000 | ' | 315,642,000 |
Less accumulated depreciation | -30,808,000 | ' | -26,222,000 |
Net capitalized costs | 317,187,000 | ' | 289,420,000 |
Depreciation, depletion and amortization | 4,700,000 | 3,200,000 | ' |
Assets Held under Capital Leases [Member] | ' | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' | ' |
PP&E Useful life (in years) | '3 years | ' | ' |
Capital Leases, Net Investment in Direct Financing and Sales Type Leases | 11,600,000 | ' | ' |
Capital Leases, Future Minimum Payments Due, Next Twelve Months | 3,300,000 | ' | ' |
Capital Leases Future Minimum Payments Due After Next Twelve Months | $1,100,000 | ' | ' |
INTANGIBLE_ASSETS_Details
INTANGIBLE ASSETS (Details) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Finite-Lived Intangible Assets [Line Items] | ' | ' |
Intangible assets | $10,492 | $10,492 |
Less accumulated amortization | -4,463 | -3,962 |
Intangible assets, net of accumulated amortization | 6,029 | 6,530 |
Customer relationships | ' | ' |
Finite-Lived Intangible Assets [Line Items] | ' | ' |
Intangible assets | 5,434 | 5,434 |
Trademark | ' | ' |
Finite-Lived Intangible Assets [Line Items] | ' | ' |
Intangible assets | 859 | 859 |
Existing contracts | ' | ' |
Finite-Lived Intangible Assets [Line Items] | ' | ' |
Intangible assets | $4,199 | $4,199 |
INVENTORY_Details
INVENTORY (Details) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Inventory Disclosure [Abstract] | ' | ' |
Materials and supplies | $3,647 | $6,790 |
Commodities | 405 | 368 |
Inventory | $4,052 | $7,158 |
ASSET_RETIREMENT_OBLIGATIONS_D
ASSET RETIREMENT OBLIGATIONS (Details) (USD $) | 3 Months Ended | 12 Months Ended | ||
Mar. 31, 2014 | Dec. 31, 2013 | |||
Summary of asset retirement obligation | ' | ' | ||
Asset retirement obligation at beginning of period | $16,216,000 | $30,680,000 | ||
Assumed in acquisitions | 0 | 17,000 | ||
Liabilities incurred | 52,000 | 253,000 | ||
Liabilities settled | -17,000 | -98,000 | ||
Liabilities sold | -12,000 | -7,614,000 | ||
Accretion expense | 368,000 | 2,264,000 | ||
Revisions in estimated liabilities | 0 | [1] | 1,935,000 | [1] |
Reclassified as liabilities associated with assets held for sale | 0 | -11,148,000 | ||
Effect of foreign currency translation | 0 | -73,000 | ||
Asset retirement obligation at end of period | 16,607,000 | 16,216,000 | ||
Less: current portion (included in other liabilities) | -61,000 | -53,000 | ||
Asset retirement obligation at end of period | 16,546,000 | 16,163,000 | ||
Revision of estimate due to change in assumptions | $1,500,000 | ' | ||
[1] | $1.5 million of the revisions in estimated liabilities is related to change in assumptions used with respect to certain wells in the Williston Basin in North Dakota during 2013. |
FAIR_VALUE_OF_FINANCIAL_INSTRU2
FAIR VALUE OF FINANCIAL INSTRUMENTS (Details) (USD $) | 3 Months Ended | |||
Mar. 31, 2014 | Dec. 31, 2013 | |||
Fair value measurements on a Recurring Basis | ' | ' | ||
Available for sale securities | $11,210,000 | [1] | $1,819,000 | [1] |
Recurring | Level 1 | ' | ' | ||
Fair value measurements on a Recurring Basis | ' | ' | ||
Available for sale securities | 11,210,000 | 1,819,000 | ||
Total assets at fair value | 11,210,000 | 1,819,000 | ||
Total liabilities at fair value | 0 | 0 | ||
Recurring | Level 1 | Commodity derivative assets | ' | ' | ||
Fair value measurements on a Recurring Basis | ' | ' | ||
Derivative assets | 0 | 0 | ||
Derivative liabilities | 0 | 0 | ||
Recurring | Level 1 | Convertible security derivative assets | ' | ' | ||
Fair value measurements on a Recurring Basis | ' | ' | ||
Derivative assets | 0 | 0 | ||
Recurring | Level 1 | Convertible preferred stock derivative liabilities | ' | ' | ||
Fair value measurements on a Recurring Basis | ' | ' | ||
Derivative liabilities | 0 | 0 | ||
Recurring | Level 2 | ' | ' | ||
Fair value measurements on a Recurring Basis | ' | ' | ||
Available for sale securities | 0 | 0 | ||
Total assets at fair value | 585,000 | 554,000 | ||
Total liabilities at fair value | 5,571,000 | 2,279,000 | ||
Recurring | Level 2 | Commodity derivative assets | ' | ' | ||
Fair value measurements on a Recurring Basis | ' | ' | ||
Derivative assets | 585,000 | 554,000 | ||
Derivative liabilities | 5,571,000 | 2,279,000 | ||
Recurring | Level 2 | Convertible security derivative assets | ' | ' | ||
Fair value measurements on a Recurring Basis | ' | ' | ||
Derivative assets | 0 | 0 | ||
Recurring | Level 2 | Convertible preferred stock derivative liabilities | ' | ' | ||
Fair value measurements on a Recurring Basis | ' | ' | ||
Derivative liabilities | 0 | 0 | ||
Recurring | Level 3 | ' | ' | ||
Fair value measurements on a Recurring Basis | ' | ' | ||
Available for sale securities | 0 | 0 | ||
Total assets at fair value | 35,000 | 79,000 | ||
Total liabilities at fair value | 72,316,000 | 75,934,000 | ||
Recurring | Level 3 | Commodity derivative assets | ' | ' | ||
Fair value measurements on a Recurring Basis | ' | ' | ||
Derivative assets | 0 | 0 | ||
Derivative liabilities | 0 | 0 | ||
Recurring | Level 3 | Convertible security derivative assets | ' | ' | ||
Assumptions and methodology used for calculating fair value of assets and liabilities | ' | ' | ||
Life | '2 years 10 months 24 days | ' | ||
Risk-free interest rate | 0.96% | ' | ||
Estimated volatility | 40.00% | ' | ||
Dividend | 0.00% | ' | ||
GreenHunter stock price at end of period | $0.96 | ' | ||
Fair value measurements on a Recurring Basis | ' | ' | ||
Derivative assets | 35,000 | 79,000 | ||
Recurring | Level 3 | Convertible preferred stock derivative liabilities | ' | ' | ||
Fair Value of Financial Instruments | ' | ' | ||
Total enterprise value | 578,000,000 | ' | ||
Fair value measurements on a Recurring Basis | ' | ' | ||
Derivative liabilities | $72,316,000 | $75,934,000 | ||
Maximum | Recurring | Level 3 | Convertible preferred stock derivative liabilities | ' | ' | ||
Fair Value of Financial Instruments | ' | ' | ||
Credit spread rate (as a percent) | 12.90% | ' | ||
Assumptions and methodology used for calculating fair value of assets and liabilities | ' | ' | ||
Estimated volatility | 25.00% | ' | ||
[1] | Available for sale securities includes $142,000 that has been classified as held for sale associated with the classification of the MHP subsidiary. |
FAIR_VALUE_OF_FINANCIAL_INSTRU3
FAIR VALUE OF FINANCIAL INSTRUMENTS (Details 2) (Level 3, USD $) | 3 Months Ended |
In Thousands, unless otherwise specified | Mar. 31, 2014 |
Preferred Stock Embedded Derivative Liability | Embedded Derivatives, Liabilities | ' |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ' |
31-Dec-13 | ($75,934) |
Issuance of derivative liability | -2,318 |
Decrease in fair value recognized in other income (expense) | 5,936 |
31-Mar-14 | -72,316 |
Embedded Derivatives, Assets | Convertible Security Embedded Derivative Financial Instruments [Member] | ' |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ' |
Fair value at December 31, 2012 Convertible Security Embedded Derivative Asset | 79 |
Issuance of derivative liability Convertible Security Embedded Derivative Asset | 0 |
Decrease in fair value recognized in other (expense) Convertible Security Embedded Derivative Asset | -44 |
Fair value as of September 30, 2013 Convertible Security Embedded Derivative Asset | $35 |
FAIR_VALUE_OF_FINANCIAL_INSTRU4
FAIR VALUE OF FINANCIAL INSTRUMENTS (Details 4) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Level 2 | Carrying Amount | Senior Notes | ' | ' |
Carrying amounts and fair values of long-term debt | ' | ' |
Fair value of senior notes | $597,251 | $597,230 |
Level 2 | Estimated Fair Value | Senior Notes | ' | ' |
Carrying amounts and fair values of long-term debt | ' | ' |
Fair value of senior notes | 666,000 | 651,300 |
Level 3 | Carrying Amount | MHR Senior Revolving Credit Facility | ' | ' |
Carrying amounts and fair values of long-term debt | ' | ' |
Fair value of senior notes | 226,000 | 218,000 |
Level 3 | Carrying Amount | Eureka Hunter Pipeline second lien term loan | ' | ' |
Carrying amounts and fair values of long-term debt | ' | ' |
Fair value of senior notes | 0 | 50,000 |
Level 3 | Carrying Amount | Eureka Hunter Pipeline Credit Agreement | ' | ' |
Carrying amounts and fair values of long-term debt | ' | ' |
Fair value of senior notes | 55,000 | 0 |
Level 3 | Carrying Amount | Equipment notes payable | ' | ' |
Carrying amounts and fair values of long-term debt | ' | ' |
Fair value of senior notes | 25,609 | 18,615 |
Level 3 | Estimated Fair Value | MHR Senior Revolving Credit Facility | ' | ' |
Carrying amounts and fair values of long-term debt | ' | ' |
Fair value of senior notes | 226,000 | 218,000 |
Level 3 | Estimated Fair Value | Eureka Hunter Pipeline second lien term loan | ' | ' |
Carrying amounts and fair values of long-term debt | ' | ' |
Fair value of senior notes | 0 | 58,921 |
Level 3 | Estimated Fair Value | Eureka Hunter Pipeline Credit Agreement | ' | ' |
Carrying amounts and fair values of long-term debt | ' | ' |
Fair value of senior notes | 55,000 | 0 |
Level 3 | Estimated Fair Value | Equipment notes payable | ' | ' |
Carrying amounts and fair values of long-term debt | ' | ' |
Fair value of senior notes | $25,659 | $17,676 |
FINANCIAL_INSTRUMENTS_AND_DERI2
FINANCIAL INSTRUMENTS AND DERIVATIVES INVESTMENTS BY TYPE (Details) (USD $) | 3 Months Ended | |
Mar. 31, 2014 | ||
Schedule of Available-for-sale Securities [Line Items] | ' | |
Available-for-sale Securities, beginning of period | $1,819,000 | [1] |
Securities received as consideration for assets sold | 9,447,000 | [1] |
Change in fair value recognized in other comprehensive loss | -56,000 | [1] |
Available-for-sale Securities, end of period | 11,210,000 | [1] |
Current available-for-sale securities | 11,068,000 | |
Equity Method Investments, end of period | 940,000 | [2] |
Equity in net loss recognized in other income (expense) | -246,000 | [2] |
Equity Method Investments, end of period | 694,000 | [2] |
Equity Method Investments, Noncurrent | 326,000 | |
MHP Subsidiary [Member] | ' | |
Schedule of Available-for-sale Securities [Line Items] | ' | |
Current available-for-sale securities | 142,000 | |
Long Term Assets [Member] | ' | |
Schedule of Available-for-sale Securities [Line Items] | ' | |
Equity Method Investments, Noncurrent | $326,000 | |
[1] | Available for sale securities includes $142,000 that has been classified as held for sale associated with the classification of the MHP subsidiary. | |
[2] | Equity method investments includes $326,000 classified as long-term other assets. |
FINANCIAL_INSTRUMENTS_AND_DERI3
FINANCIAL INSTRUMENTS AND DERIVATIVES INVESTMENTS BY BALANCE SHEET LOCATION (Details) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 | ||
Schedule of Available-for-sale Securities [Line Items] | ' | ' | ||
Available-for-sale Securities, Current | $11,068,000 | ' | ||
Equity Method Investments, Current | 368,000 | ' | ||
Investments, Available-for-sale and Equity Method, Current | 11,436,000 | ' | ||
Available-for-sale Securities, Noncurrent | 0 | ' | ||
Equity Method Investments, Noncurrent | 326,000 | ' | ||
Investments, Available-for-sale and Equity Method, Noncurrent | 326,000 | ' | ||
Available-for-sale Securities | 11,210,000 | [1] | 1,819,000 | [1] |
Equity Method Investments | 694,000 | [2] | 940,000 | [2] |
Investments, Available-for-sale and Equity Method, Current and Noncurrent | 11,904,000 | ' | ||
Long Term Assets [Member] | ' | ' | ||
Schedule of Available-for-sale Securities [Line Items] | ' | ' | ||
Equity Method Investments, Noncurrent | 326,000 | ' | ||
MHP Subsidiary [Member] | ' | ' | ||
Schedule of Available-for-sale Securities [Line Items] | ' | ' | ||
Available-for-sale Securities, Current | $142,000 | ' | ||
[1] | Available for sale securities includes $142,000 that has been classified as held for sale associated with the classification of the MHP subsidiary. | |||
[2] | Equity method investments includes $326,000 classified as long-term other assets. |
FINANCIAL_INSTRUMENTS_AND_DERI4
FINANCIAL INSTRUMENTS AND DERIVATIVES INVESTMENTS, FAIR VALUE (Details) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Investments, Debt and Equity Securities [Abstract] | ' | ' |
Equity Securities, Amortized Cost | $9,875 | $428 |
Equity Securities, Gross Unrealized Gain | 0 | 0 |
Equity Securities, Gross Unrealized Loss | -324 | -281 |
Equity Securities | 9,551 | 147 |
Equity Securities, Related Party, Amortized Cost Basis | 2,200 | 2,200 |
Equity Securities, Related Party, Gross Unrealized Gain | 0 | 0 |
Equity Securities, Related Party, Gross Unrealized Loss | -541 | -528 |
Equity Securities, Related Party | 1,659 | 1,672 |
Equity Securities, Including Related Party, Amortized Cost Basis | 12,075 | 2,628 |
Equity Securities, Including Related Party, Gross Unrealized Gain | 0 | 0 |
Equity Securities, Including Related Party, Gross Unrealized Loss | -865 | -809 |
Equity Securities, Including Related Party | $11,210 | $1,819 |
FINANCIAL_INSTRUMENT_AND_DERIV
FINANCIAL INSTRUMENT AND DERIVATIVES (Commodity Derivatives) (Details) | 3 Months Ended | |
Mar. 31, 2014 | ||
Natural Gas | Swap [Member] | ' | |
Derivative [Line Items] | ' | |
Weighted Average Price | 4.23 | |
Natural Gas | April 2014 to December 2014 [Member] | Collars [Member] | ' | |
Derivative [Line Items] | ' | |
MMBtu/day | 5,000 | |
Natural Gas | April 2014 to December 2014 [Member] | Swap [Member] | ' | |
Derivative [Line Items] | ' | |
MMBtu/day | 31,000 | |
Natural Gas | April 2014 to December 2014 [Member] | Call Option [Member] | ' | |
Derivative [Line Items] | ' | |
MMBtu/day | 16,000 | |
Weighted Average Price | 5.91 | |
Natural Gas | January 2015 to December 2015 [Member] | Swap [Member] | ' | |
Derivative [Line Items] | ' | |
MMBtu/day | 20,000 | |
Weighted Average Price | 4.18 | |
Crude Oil [Member] | April 2014 to December 2014 [Member] | Collars [Member] | ' | |
Derivative [Line Items] | ' | |
Bbl/day | 663 | |
Crude Oil [Member] | April 2014 to December 2014 [Member] | Three Way Collars [Member] | ' | |
Derivative [Line Items] | ' | |
Bbl/day | 4,000 | |
Weighted Average Price | 85 | [1] |
Crude Oil [Member] | April 2014 to December 2014 [Member] | Put Option [Member] | ' | |
Derivative [Line Items] | ' | |
Bbl/day | 663 | |
Weighted Average Price | 65 | |
Crude Oil [Member] | January 2015 to December 2015 [Member] | Collars [Member] | ' | |
Derivative [Line Items] | ' | |
Bbl/day | 259 | |
Crude Oil [Member] | January 2015 to December 2015 [Member] | Call Option [Member] | ' | |
Derivative [Line Items] | ' | |
Bbl/day | 1,570 | |
Weighted Average Price | 120 | |
Crude Oil [Member] | January 2015 to December 2015 [Member] | Put Option [Member] | ' | |
Derivative [Line Items] | ' | |
Bbl/day | 259 | |
Weighted Average Price | 70 | |
Maximum | Natural Gas | April 2014 to December 2014 [Member] | Collars [Member] | ' | |
Derivative [Line Items] | ' | |
Weighted Average Price | 5.25 | [2] |
Maximum | Crude Oil [Member] | April 2014 to December 2014 [Member] | Collars [Member] | ' | |
Derivative [Line Items] | ' | |
Weighted Average Price | 91.25 | [2] |
Maximum | Crude Oil [Member] | April 2014 to December 2014 [Member] | Three Way Collars [Member] | ' | |
Derivative [Line Items] | ' | |
Weighted Average Price | 102.5 | [1] |
Maximum | Crude Oil [Member] | January 2015 to December 2015 [Member] | Collars [Member] | ' | |
Derivative [Line Items] | ' | |
Weighted Average Price | 91.25 | [2] |
Minimum | Natural Gas | April 2014 to December 2014 [Member] | Collars [Member] | ' | |
Derivative [Line Items] | ' | |
Weighted Average Price | 4 | [2] |
Minimum | Crude Oil [Member] | April 2014 to December 2014 [Member] | Collars [Member] | ' | |
Derivative [Line Items] | ' | |
Weighted Average Price | 85 | [2] |
Minimum | Crude Oil [Member] | April 2014 to December 2014 [Member] | Three Way Collars [Member] | ' | |
Derivative [Line Items] | ' | |
Weighted Average Price | 64.94 | [1] |
Minimum | Crude Oil [Member] | January 2015 to December 2015 [Member] | Collars [Member] | ' | |
Derivative [Line Items] | ' | |
Weighted Average Price | 85 | [2] |
[1] | These three-way collars are a combination of three options: a sold call, a purchased put and a sold put. | |
[2] | A collar is a sold call and a purchased put. Some collars are "costless" collars with the premiums netting to approximately zero. |
FINANCIAL_INSTRUMENTS_AND_DERI5
FINANCIAL INSTRUMENTS AND DERIVATIVES (Details) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Derivatives, Fair Value | ' | ' |
Derivative Assets | $620 | $633 |
Derivative Liabilities | -77,887 | -78,213 |
Commodity | ' | ' |
Derivatives, Fair Value | ' | ' |
Derivative Assets | 585 | 554 |
Derivative Liabilities | -5,571 | -2,279 |
Financial | ' | ' |
Derivatives, Fair Value | ' | ' |
Derivative Assets | 35 | 79 |
Derivative Liabilities | -72,316 | -75,934 |
Derivative assets | Commodity | ' | ' |
Derivatives, Fair Value | ' | ' |
Derivative Assets | 0 | 529 |
Derivative assets | Financial | ' | ' |
Derivatives, Fair Value | ' | ' |
Derivative Assets | 35 | 79 |
Derivative assets - long-term | Commodity | ' | ' |
Derivatives, Fair Value | ' | ' |
Derivative Assets | 585 | 25 |
Derivative liabilities | Commodity | ' | ' |
Derivatives, Fair Value | ' | ' |
Derivative Liabilities | -5,276 | -1,903 |
Derivative liabilities - long-term | Commodity | ' | ' |
Derivatives, Fair Value | ' | ' |
Derivative Liabilities | -295 | -376 |
Derivative liabilities - long-term | Financial | ' | ' |
Derivatives, Fair Value | ' | ' |
Derivative Liabilities | ($72,316) | ($75,934) |
FINANCIAL_INSTRUMENTS_AND_DERI6
FINANCIAL INSTRUMENTS AND DERIVATIVES (Effect of Master Netting) (Details) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Derivative [Line Items] | ' | ' |
Derivative Assets | $620 | $633 |
Derivative Asset, Fair Value, Amount Not Offset Against Collateral | -4,986 | -1,725 |
Derivative, Fair Value, Amount Offset Against Collateral, Net | 0 | 0 |
Derivative, Fair Value, Net | -4,986 | -1,725 |
Current Assets [Member] | ' | ' |
Derivative [Line Items] | ' | ' |
Derivative Assets | 1,561 | 4,034 |
Derivative Asset, Fair Value, Amount Offset Against Collateral | 1,561 | 3,505 |
Derivative assets | 0 | 529 |
Long Term Assets [Member] | ' | ' |
Derivative [Line Items] | ' | ' |
Derivative Assets | 928 | 516 |
Derivative Asset, Fair Value, Amount Offset Against Collateral | 343 | 491 |
Derivative assets | 585 | 25 |
Current Liabilities [Member] | ' | ' |
Derivative [Line Items] | ' | ' |
Derivative Liability, Fair Value, Gross Liability | -6,837 | -5,408 |
Derivative Liability, Fair Value, Amount Offset Against Collateral | -1,561 | -3,505 |
Derivative Liability | -5,276 | -1,903 |
Long-term Liabilities [Member] | ' | ' |
Derivative [Line Items] | ' | ' |
Derivative Liability, Fair Value, Gross Liability | -638 | -867 |
Derivative Liability, Fair Value, Amount Offset Against Collateral | -343 | -491 |
Derivative Liability | ($295) | ($376) |
FINANCIAL_INSTRUMENTS_AND_DERI7
FINANCIAL INSTRUMENTS AND DERIVATIVES (Details 3) (Commodity derivative assets, Other Income (Expense) [Member], USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Summary of net gain (loss) on derivative contracts | ' | ' |
Gain (loss) on derivative contracts | $347 | ($7,491) |
Settled Transaction [Member] | ' | ' |
Summary of net gain (loss) on derivative contracts | ' | ' |
Gain (loss) on derivative contracts | -2,284 | 956 |
Open Transaction [Member] | ' | ' |
Summary of net gain (loss) on derivative contracts | ' | ' |
Gain (loss) on derivative contracts | $2,631 | ($8,447) |
LONGTERM_DEBT_Details
LONG-TERM DEBT (Details) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2014 | Dec. 31, 2012 | Dec. 31, 2013 | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2014 | Mar. 28, 2014 | Dec. 31, 2013 | Mar. 31, 2014 | Dec. 31, 2013 | ||
Senior Notes | Senior Notes | Notes Payable, Other Payables [Member] | Notes Payable, Other Payables [Member] | Notes Payable, Other Payables [Member] | Notes Payable, Other Payables [Member] | Notes Payable, Other Payables [Member] | Line of Credit [Member] | Line of Credit [Member] | Line of Credit [Member] | Line of Credit [Member] | Term Loan [Member] | Term Loan [Member] | Term Loan [Member] | Term Loan [Member] | Term Loan [Member] | |||||
9.75 Percent Senior Notes Due May 15, 2020 [Member] | 9.75 Percent Senior Notes Due May 15, 2020 [Member] | Notes Payable Due January 2015 - April 2021 [Member] | Notes Payable Due January 2015 - April 2021 [Member] | Notes Payable Due January 2015 - April 2021 [Member] | Revolving Credit Facility [Member] | Revolving Credit Facility [Member] | Revolving Credit Facility [Member] | Revolving Credit Facility [Member] | 12.5 Percent Term Loan due August 16, 2018 [Member] | 12.5 Percent Term Loan due August 16, 2018 [Member] | 12.5 Percent Term Loan due August 16, 2018 [Member] | 12.5 Percent Term Loan due August 16, 2018 [Member] | 12.5 Percent Term Loan due August 16, 2018 [Member] | |||||||
5.75 Percent Credit Agreement due March 28, 2018 [Member] | 5.75 Percent Credit Agreement due March 28, 2018 [Member] | 2.96 and 3.56 Percent Revolving Credit Facility due April 2016 and December 2013 [Member] | 2.96 and 3.56 Percent Revolving Credit Facility due April 2016 and December 2013 [Member] | Eureka Hunter Pipeline, LLC | Eureka Hunter Pipeline, LLC | |||||||||||||||
Debt Instrument [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||
Total long-term debt, outstanding | $903,860,000 | $883,845,000 | $597,251,000 | $597,230,000 | ' | ' | $25,609,000 | [1] | ' | $18,615,000 | [1] | $55,000,000 | $0 | $226,000,000 | $218,000,000 | $0 | $50,000,000 | $50,000,000 | ' | ' |
Less: current portion | -9,986,000 | -3,967,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||
Total long-term debt obligations, net of current portion | 893,874,000 | 879,878,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||
Liabilities associated with assets held for sale | ' | ' | ' | ' | 4,600,000 | 200,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||
Long-term liabilities associated with assets held for sale | 12,983,000 | 14,523,000 | ' | ' | 2,300,000 | 3,800,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||
Long-term debt, stated interest rate | ' | ' | 9.75% | 9.75% | ' | ' | ' | ' | ' | 5.75% | 5.75% | 2.96% | 3.56% | ' | ' | ' | 12.50% | 12.50% | ||
Long-term debt, unamortized discount | ' | ' | $2,800,000 | $2,800,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||
Long-term debt, stated interest rate, minimum | ' | ' | ' | ' | ' | ' | 4.25% | 4.25% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||
Long-term debt, stated interest rate, maximum | ' | ' | ' | ' | ' | ' | 5.70% | 5.70% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||
[1] | Includes notes classified as liabilities associated with assets held for sale of which $4.6 million is current and $2.3 million is long-term at March 31, 2014, and $0.2 million is current and $3.8 million is long-term at December 31, 2013. |
LONGTERM_DEBT_Expected_Annual_
LONG-TERM DEBT (Expected Annual Maturities of Debt) (Details) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
Summary of approximate annual maturities of debt | ' | ' |
2014 | $4,354,000 | ' |
2015 | 9,989,000 | ' |
2016 | 234,548,000 | ' |
2017 | 2,358,000 | ' |
2018 | 55,360,000 | ' |
Thereafter | 600,000,000 | ' |
Total long-term debt, outstanding | 906,609,000 | ' |
Senior Notes | 9.75 Percent Senior Notes Due May 15, 2020 [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt, unamortized discount | $2,800,000 | $2,800,000 |
LONGTERM_DEBT_MHR_Senior_Revol
LONG-TERM DEBT (MHR Senior Revolving Credit Facility) (Details) (Line of Credit [Member], MHR Senior Revolving Credit Facility, MHR Senior Revolving Credit Facility [Member], USD $) | Mar. 31, 2014 | Dec. 31, 2013 | 6-May-14 |
Subsequent Event | |||
Debt Instrument [Line Items] | ' | ' | ' |
Borrowing base | $232,500,000 | ' | $325,000,000 |
Credit facility amount outstanding | $226,000,000 | $218,000,000 | ' |
LONGTERM_DEBT_Eureka_Hunter_Pi
LONG-TERM DEBT (Eureka Hunter Pipeline Credit Agreement) (Details) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2014 | Mar. 28, 2014 | Dec. 31, 2013 | Jan. 21, 2014 | Mar. 28, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 28, 2014 | Mar. 28, 2014 | Mar. 28, 2014 | Mar. 28, 2014 | Mar. 28, 2014 | Mar. 28, 2014 | Mar. 28, 2014 | Mar. 28, 2014 | Mar. 28, 2014 | Mar. 28, 2014 |
Term Loan [Member] | Term Loan [Member] | Term Loan [Member] | Notes Payable, Other Payables [Member] | Revolving Credit Facility [Member] | Revolving Credit Facility [Member] | Revolving Credit Facility [Member] | Revolving Credit Facility [Member] | Revolving Credit Facility [Member] | Commitment Fee Percent When Consolidated Leverage Ratio is Greater or Equal to 3 to 1 [Member] | Commitment Fee Percent When Consolidated Leverage Ratio is Less Than 3 to 1 [Member] | Fiscal Quarter Ending March 31, 2014 Through September 30, 2014 [Member] | Revolving Credit Facility [Member] | Minimum | Minimum | Maximum | Maximum | |||
12.5 Percent Term Loan due August 16, 2018 [Member] | 12.5 Percent Term Loan due August 16, 2018 [Member] | 12.5 Percent Term Loan due August 16, 2018 [Member] | 7.94 Percent Equipment Note Payable [Member] | Line of Credit [Member] | Line of Credit [Member] | Line of Credit [Member] | Line of Credit [Member] | Line of Credit [Member] | Revolving Credit Facility [Member] | Revolving Credit Facility [Member] | Revolving Credit Facility [Member] | Line of Credit [Member] | Revolving Credit Facility [Member] | Revolving Credit Facility [Member] | Revolving Credit Facility [Member] | Revolving Credit Facility [Member] | |||
5.75 Percent Credit Agreement due March 28, 2018 [Member] | 5.75 Percent Credit Agreement due March 28, 2018 [Member] | 5.75 Percent Credit Agreement due March 28, 2018 [Member] | 5.75 Percent Credit Agreement due March 28, 2018 [Member] | 5.75 Percent Credit Agreement due March 28, 2018 [Member] | Line of Credit [Member] | Line of Credit [Member] | Line of Credit [Member] | 5.75 Percent Credit Agreement due March 28, 2018 [Member] | Line of Credit [Member] | Line of Credit [Member] | Line of Credit [Member] | Line of Credit [Member] | |||||||
Eurodollar [Member] | Federal Funds Rate | 5.75 Percent Credit Agreement due March 28, 2018 [Member] | 5.75 Percent Credit Agreement due March 28, 2018 [Member] | 5.75 Percent Credit Agreement due March 28, 2018 [Member] | 5.75 Percent Credit Agreement due March 28, 2018 [Member] | 5.75 Percent Credit Agreement due March 28, 2018 [Member] | 5.75 Percent Credit Agreement due March 28, 2018 [Member] | 5.75 Percent Credit Agreement due March 28, 2018 [Member] | |||||||||||
Eurodollar [Member] | Base Rate [Member] | Eurodollar [Member] | Base Rate [Member] | ||||||||||||||||
Debt Instrument [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Borrowing base | ' | ' | ' | ' | ' | ' | $117,000,000 | $58,700,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Borrowing capacity limit increase | ' | ' | ' | ' | ' | ' | 150,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Deferred finance costs | ' | ' | ' | ' | ' | ' | 1,200,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Long-term debt | 903,860,000 | 883,845,000 | 0 | 50,000,000 | 50,000,000 | ' | ' | 55,000,000 | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Line of credit facility, commitment fee percentage | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0.50% | 0.38% | ' | ' | ' | ' | ' | ' |
Consolidated leverage ratio | ' | ' | ' | ' | ' | ' | 3 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt instrument, basis spread on variable rate | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1.00% | 0.50% | ' | ' | ' | ' | 2.00% | 1.00% | 3.50% | 2.50% |
Interest rate increase under default | ' | ' | ' | ' | ' | ' | 2.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Maximum leverage ratio | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 4.75 | 4.5 | ' | ' | ' | ' |
Minimum interest coverage ratio | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2.75 | 2.5 | ' | ' | ' | ' |
Credit facility amount outstanding | ' | ' | ' | ' | ' | ' | ' | -55,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Prepayment penalty | ' | ' | 2,200,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Accrued interest | ' | ' | ' | 1,500,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Face amount | ' | ' | ' | ' | ' | $5,600,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Long-term debt, stated interest rate | ' | ' | ' | ' | ' | 7.94% | ' | 5.75% | 5.75% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Term of note payable | ' | ' | ' | ' | ' | '48 months | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
LONGTERM_DEBT_Interest_Expense
LONG-TERM DEBT (Interest Expense) (Details) (USD $) | 3 Months Ended | |
Mar. 31, 2014 | Mar. 31, 2013 | |
Debt Instrument [Line Items] | ' | ' |
Write off of unamortized deferred financing costs | $2,700,000 | ' |
Interest expense incurred on debt, net of amounts capitalized | 20,228,000 | 17,844,000 |
Amortization and write-off of deferred financing costs | 3,621,000 | 857,000 |
Total Interest Expense | 23,849,000 | 18,701,000 |
Term Loan [Member] | 12.5 Percent Term Loan due August 16, 2018 [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Prepayment penalty | 2,200,000 | ' |
Oil and Gas Properties [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Interest costs capitalized | $600,000 | $800,000 |
SHAREBASED_COMPENSATION_Detail
SHARE-BASED COMPENSATION (Details) (USD $) | 3 Months Ended | ||
In Thousands, except Share data, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 | Dec. 31, 2011 |
Share Based Compensation | ' | ' | ' |
Number of shares authorized under the 2006 Stock Incentive Plan | 27,500,000 | ' | ' |
Number of shares issued under the 2006 Stock Incentive Plan | 7,448,674 | ' | ' |
Share based compensation | $1,061 | $6,250 | ' |
Stock options and stock appreciation rights | ' | ' | ' |
Shares | ' | ' | ' |
Outstanding at beginning of period (in shares) | 16,891,000 | ' | 14,847,000 |
Granted (in shares) | 0 | 4,363,000 | ' |
Exercised (in shares) | -597,000 | 0 | ' |
Cancelled (in shares) | -902,000 | -225,000 | ' |
Outstanding at end of period (in shares) | 15,392,000 | 18,985,000 | 14,847,000 |
Exercisable at end of period (in shares) | 10,003,000 | 9,946,000 | ' |
Weighted Average Exercise Price | ' | ' | ' |
Outstanding at beginning of period (in dollars per share) | $5.69 | ' | $6.01 |
Granted (in dollars per share) | $0 | $4.16 | ' |
Exercised (in dollars per share) | $6.67 | $0 | ' |
Cancelled (in dollars per share) | $6.37 | $7.37 | ' |
Outstanding at end of period (in dollars per share) | $5.61 | $5.57 | $6.01 |
Exercisable at end of period (in dollars per share) | $5.74 | $5.65 | ' |
Non-vested Shares | ' | ' | ' |
Non-vested at beginning of period (in shares) | 6,908,000 | ' | 6,163,000 |
Granted (in shares) | 0 | 4,363,000 | ' |
Vested (in shares) | -805,000 | -1,482,000 | ' |
Cancelled (in shares) | -714,000 | -6,000 | ' |
Non-vested at end of period (in shares) | 5,389,000 | 9,038,000 | 6,163,000 |
Additional disclosures | ' | ' | ' |
Unrecognized compensation cost | 7,900 | 17,200 | ' |
Weighted average period for recognition of compensation cost | '1 year 0 months 18 days | ' | ' |
Remaining contractual term | '5 years 1 month 28 days | ' | ' |
Restricted stock | ' | ' | ' |
Additional disclosures | ' | ' | ' |
Unrecognized compensation cost | 9,283 | 264 | ' |
Weighted average period for recognition of compensation cost | '2 years 7 months 10 days | ' | ' |
Restricted stock | ' | ' | ' |
Share Based Compensation | ' | ' | ' |
Award vesting period | '1 year | ' | ' |
Restricted stock | Officers executives and employees | ' | ' | ' |
Share Based Compensation | ' | ' | ' |
Stock options, granted | 1,342,575 | ' | ' |
Award vesting period | '3 years | ' | ' |
Vesting rights percentage | 33.00% | ' | ' |
Vesting Period for One Third of Shares | '1 year | ' | ' |
Restricted stock | Board of directors | ' | ' | ' |
Share Based Compensation | ' | ' | ' |
Stock options, granted | 123,798 | ' | ' |
Share Based Compensation Arrangement by Share Based Payment Award Estimated Future Forfeiture Rate | 3.40% | ' | ' |
Vesting rights percentage | 100.00% | ' | ' |
Share based compensation | $10,700 | ' | ' |
SHAREHOLDERS_EQUITY_Details
SHAREHOLDERS’ EQUITY (Details) (USD $) | 3 Months Ended | 12 Months Ended | ||
In Thousands, except Share data, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 |
Class of Stock [Line Items] | ' | ' | ' | ' |
Shares issued in connection with share-based compensation | 25,152 | ' | ' | ' |
Proceeds from stock issuance | ' | $10,264 | ' | ' |
Approximate offering expenses | 0 | 109 | ' | ' |
Preferred stock dividends | 14,896 | 13,488 | ' | ' |
Accretion of the difference between the carrying value and the redemption value of preferred stock included in dividends | 2,048 | 1,468 | ' | ' |
Common Stock | ' | ' | ' | ' |
Class of Stock [Line Items] | ' | ' | ' | ' |
Dividends, ratio of warrants received per common stock | 10.00% | ' | ' | ' |
Depositary Shares | ' | ' | ' | ' |
Class of Stock [Line Items] | ' | ' | ' | ' |
Proceeds from stock issuance | 28,900 | ' | ' | ' |
Interest in share of Series E Preferred Stock per Depository Share | 0.001 | ' | ' | ' |
Common stock issued in connection with acquisition (in shares) | 4,300,000 | ' | ' | ' |
Consideration received, value of common stock (price per share) | $7 | ' | ' | ' |
Class A Preferred Units | Eureka Hunter Holdings, LLC | ' | ' | ' | ' |
Class of Stock [Line Items] | ' | ' | ' | ' |
Stocks issued (in Shares) | 200,000 | ' | ' | ' |
Preferred stock dividends | 4,028 | 3,114 | ' | ' |
Series C Preferred Stock | ' | ' | ' | ' |
Class of Stock [Line Items] | ' | ' | ' | ' |
Preferred stock dividends | 2,562 | 2,562 | ' | ' |
Series D Preferred Stock | ' | ' | ' | ' |
Class of Stock [Line Items] | ' | ' | ' | ' |
Cumulative dividend rate for cumulative preferred stock (as a percent) | 8.00% | ' | 8.00% | ' |
Liquidation preference (in dollars per share) | $50 | ' | ' | $50 |
Preferred stock dividends | 4,424 | 4,382 | ' | ' |
Series E Preferred Stock | ' | ' | ' | ' |
Class of Stock [Line Items] | ' | ' | ' | ' |
Cumulative dividend rate for cumulative preferred stock (as a percent) | 8.00% | ' | 8.00% | ' |
Liquidation preference (in dollars per share) | $25,000 | ' | ' | $25,000 |
Preferred stock dividends | $1,834 | $1,962 | ' | ' |
Common Stock | ' | ' | ' | ' |
Class of Stock [Line Items] | ' | ' | ' | ' |
Shares of common stock issued upon exercise of common stock options | 597,000 | ' | ' | ' |
Stocks issued (in Shares) | 4,300,000 | ' | ' | ' |
Dilutive [Member] | ' | ' | ' | ' |
Class of Stock [Line Items] | ' | ' | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 44,862,000 | 43,307,000 | ' | ' |
Series E Preferred Stock | Dilutive [Member] | ' | ' | ' | ' |
Class of Stock [Line Items] | ' | ' | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 10,946,000 | 10,946,000 | ' | ' |
Warrant [Member] | Dilutive [Member] | ' | ' | ' | ' |
Class of Stock [Line Items] | ' | ' | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 17,071,000 | 13,376,000 | ' | ' |
Restricted shares granted, not yet issued | Dilutive [Member] | ' | ' | ' | ' |
Class of Stock [Line Items] | ' | ' | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 1,453,000 | 0 | ' | ' |
Common stock options and stock appreciations rights | Dilutive [Member] | ' | ' | ' | ' |
Class of Stock [Line Items] | ' | ' | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 15,392,000 | 18,985,000 | ' | ' |
REDEEMABLE_PREFERRED_STOCK_Det
REDEEMABLE PREFERRED STOCK (Details) (USD $) | 3 Months Ended | 3 Months Ended | ||||||
In Thousands, except Share data, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2014 | Mar. 31, 2014 |
Level 3 | Level 3 | Series A Preferred Units | Series A Preferred Units | Series A Preferred Units | Series A Preferred Units | |||
Derivative Financial Instruments, Liabilities | Derivative Financial Instruments, Liabilities | Eureka Hunter Holdings, LLC | Eureka Hunter Holdings, LLC | |||||
Preferred Stock Embedded Derivative Liability | Preferred Stock Embedded Derivative Liability | Ridgeline Midstream Holdings, LLC | ||||||
Class of Stock [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' |
Proceeds from sale of Eureka Hunter Holdings Series A Preferred Units | $3,920 | ' | ' | ' | ' | ' | ' | $191,800 |
Stocks issued (in Shares) | ' | ' | ' | ' | ' | ' | 200,000 | ' |
Stock Issued, value | 28,897 | ' | ' | ' | ' | ' | 3,900 | ' |
Preferred stock, shares issued | ' | ' | ' | ' | 10,182,540 | 9,885,048 | ' | ' |
Ownership percentage | ' | ' | ' | ' | ' | ' | 42.40% | ' |
Preferred stock issued as in-kind payment (in shares) | ' | ' | ' | ' | ' | ' | 97,492 | ' |
Preferred stock, dividends paid-in-kind | 1,900 | 2,253 | ' | ' | ' | ' | 1,900 | ' |
Embedded derivative, fair value | ' | ' | 72,316 | 75,934 | ' | ' | ' | ' |
Accretion of the difference between the carrying value and the redemption value of preferred stock included in dividends | $2,048 | $1,468 | ' | ' | ' | ' | ' | ' |
TAXES_Details
TAXES (Details) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Income Tax Expense (Benefit), Continuing Operations [Abstract] | ' | ' |
Deferred | $0 | $4,899 |
Income tax benefit | $0 | $4,899 |
RELATED_PARTY_TRANSACTIONS_Bal
RELATED PARTY TRANSACTIONS (Balances) (Details) (GreenHunter Resources, Inc., USD $) | Mar. 31, 2014 | Dec. 31, 2013 | ||
Related Party Transaction | ' | ' | ||
Accounts payable - net | $451,000 | [1] | $23,000 | [1] |
Derivative assets | 35,000 | [1],[2] | 79,000 | [1],[2] |
Investments | 2,027,000 | [1],[2] | 2,262,000 | [1],[2] |
Notes receivable | 1,632,000 | [1],[2] | 1,768,000 | [1],[2] |
Prepaid Expense | 0 | [1] | 9,000 | [1] |
Common Stock | ' | ' | ||
Related Party Transaction | ' | ' | ||
Investment in related parties, shares | 1,846,722 | ' | ||
Investment in related parties, carrying value | 367,984 | ' | ||
Series C Preferred Stock | ' | ' | ||
Related Party Transaction | ' | ' | ||
Investment in related parties, shares | 88,000 | ' | ||
Investment in related parties, carrying value | $1,700,000 | ' | ||
[1] | GreenHunter is an entity of which Gary C. Evans, the Company's Chairman and CEO, is the Chairman, a major shareholder and interim CEO; of which David Krueger, the Company's former Chief Accounting Officer and Senior Vice President, is the former Chief Financial Officer; and of which Ronald D. Ormand, the Company’s former Chief Financial Officer and Executive Vice President, is a former director. Eagle Ford Hunter received, and Triad Hunter and Viking International Resources, Inc., wholly-owned subsidiaries of the Company, receive services related to brine water and rental equipment from GreenHunter and its affiliated companies, White Top Oilfield Construction, LLC and Black Water Services, LLC. The Company believes that such services were and are provided at competitive market rates and were and are comparable to, or more attractive than, rates that could be obtained from unaffiliated third party suppliers of such services. | |||
[2] | On February 17, 2012, the Company sold its wholly-owned subsidiary, Hunter Disposal, to GreenHunter Water, LLC ("GreenHunter Water"), a wholly-owned subsidiary of GreenHunter. The Company recognized an embedded derivative asset resulting from the conversion option under the convertible promissory note it received as partial consideration for the sale. See "Note 8 - Fair Value of Financial Instruments" for additional information. The Company has recorded interest income as a result of the note receivable from GreenHunter. Also as a result of this transaction, the Company has an equity method investment in GreenHunter that is included in derivatives and other long-term assets and an available for sale investment in GreenHunter included in investments. |
RELATED_PARTY_TRANSACTIONS_Det
RELATED PARTY TRANSACTIONS (Details) (USD $) | 3 Months Ended | |||
In Thousands, except Share data, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 | ||
Related Party Transaction | ' | ' | ||
Related Party Transaction Rental Agreement Term | '5 years | ' | ||
GreenHunter Resources, Inc. | ' | ' | ||
Related Party Transaction | ' | ' | ||
Loss related to investment | $235 | [1] | $526 | [1] |
GreenHunter Resources, Inc. | Water disposal costs | ' | ' | ||
Related Party Transaction | ' | ' | ||
Related party expenses | 322 | [2] | 856 | [2] |
GreenHunter Resources, Inc. | Equipment Rental Expense | ' | ' | ||
Related Party Transaction | ' | ' | ||
Related party expenses | 122 | [2] | 0 | [2] |
GreenHunter Resources, Inc. | Interest Income from Note Receivable | ' | ' | ||
Related Party Transaction | ' | ' | ||
Drilling revenues | 45 | [1] | 55 | [1] |
Pilatus Hunter | ' | ' | ||
Related Party Transaction | ' | ' | ||
Percentage of owned in subsidiary | 100.00% | ' | ||
Pilatus Hunter | Airplane Rental Expenses | ' | ' | ||
Related Party Transaction | ' | ' | ||
Related party expenses | 70 | [3] | 47 | [3] |
Chief Executive Officer | ' | ' | ||
Related Party Transaction | ' | ' | ||
Related Party Transaction, Shares Purchased by Related Party from Agreement for Acquisition of Assets | 27,641 | ' | ||
Series C Cumulative Perpetual Preferred Stock | GreenHunter Resources, Inc. | ' | ' | ||
Related Party Transaction | ' | ' | ||
Proceeds from Dividends Received | $55 | $0 | ||
[1] | On February 17, 2012, the Company sold its wholly-owned subsidiary, Hunter Disposal, to GreenHunter Water, LLC ("GreenHunter Water"), a wholly-owned subsidiary of GreenHunter. The Company recognized an embedded derivative asset resulting from the conversion option under the convertible promissory note it received as partial consideration for the sale. See "Note 8 - Fair Value of Financial Instruments" for additional information. The Company has recorded interest income as a result of the note receivable from GreenHunter. Also as a result of this transaction, the Company has an equity method investment in GreenHunter that is included in derivatives and other long-term assets and an available for sale investment in GreenHunter included in investments. | |||
[2] | GreenHunter is an entity of which Gary C. Evans, the Company's Chairman and CEO, is the Chairman, a major shareholder and interim CEO; of which David Krueger, the Company's former Chief Accounting Officer and Senior Vice President, is the former Chief Financial Officer; and of which Ronald D. Ormand, the Company’s former Chief Financial Officer and Executive Vice President, is a former director. Eagle Ford Hunter received, and Triad Hunter and Viking International Resources, Inc., wholly-owned subsidiaries of the Company, receive services related to brine water and rental equipment from GreenHunter and its affiliated companies, White Top Oilfield Construction, LLC and Black Water Services, LLC. The Company believes that such services were and are provided at competitive market rates and were and are comparable to, or more attractive than, rates that could be obtained from unaffiliated third party suppliers of such services. | |||
[3] | The Company rented an airplane for business use for certain members of Company management at various times from Pilatus Hunter, LLC, an entity 100% owned by Mr. Evans. Airplane rental expenses are recorded in general and administrative expense. |
COMMITMENTS_AND_CONTINGENCIES_
COMMITMENTS AND CONTINGENCIES Commitments and Contingencies (Details) (Triad Hunter [Member]) | 0 Months Ended |
Aug. 12, 2013 | |
acre | |
Triad Hunter [Member] | ' |
Subsequent Event [Line Items] | ' |
Number of mineral acres agreed to acquire | 32,000 |
SUPPLEMENTAL_CASH_FLOW_INFORMA2
SUPPLEMENTAL CASH FLOW INFORMATION (Details) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Supplemental Cash Flow Elements [Abstract] | ' | ' |
Cash paid for interest | $3,660 | $3,928 |
Non-cash transactions | ' | ' |
Non-cash consideration received from sale of assets | 9,400 | ' |
Change in accrued capital expenditures | 55,396 | 9,377 |
Non-cash additions to asset retirement obligation | 52 | 1,964 |
Eureka Hunter Holdings Series A Preferred Unit dividends paid in kind | $1,900 | $2,253 |
SEGMENT_REPORTING_Details
SEGMENT REPORTING (Details) (USD $) | 3 Months Ended | ||
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 | Dec. 31, 2013 |
Details of operating activities by segment | ' | ' | ' |
Total revenue | $107,444 | $54,234 | ' |
Depletion, depreciation, amortization and accretion | 29,408 | 17,288 | ' |
Loss (gain) on sale of assets, net | 3,459 | -19 | ' |
Other operating expenses | 88,777 | 76,976 | ' |
Other income (expense) | -23,701 | -26,351 | ' |
Income (loss) from continuing operations before income tax | -37,901 | -66,362 | ' |
Income tax benefit | 0 | 4,899 | ' |
Income from discontinued operations, net of tax | 3,362 | 16,763 | ' |
Net income (loss) | -61,701 | -44,700 | ' |
Total assets | 1,893,853 | 2,313,929 | 1,856,651 |
Total capital expenditures | 97,966 | 155,023 | ' |
Income (Loss) from Discontinued Operations, Net of Tax, Attributable to Parent | -23,800 | 16,763 | ' |
U.S. Upstream | ' | ' | ' |
Details of operating activities by segment | ' | ' | ' |
Total revenue | 70,174 | 34,645 | ' |
Depletion, depreciation, amortization and accretion | 24,939 | 14,263 | ' |
Loss (gain) on sale of assets, net | 3,457 | -19 | ' |
Other operating expenses | 44,729 | 44,063 | ' |
Other income (expense) | -278 | -2,123 | ' |
Income (loss) from continuing operations before income tax | -3,229 | -25,785 | ' |
Income tax benefit | ' | 4,854 | ' |
Income from discontinued operations, net of tax | -23,128 | 16,489 | ' |
Net income (loss) | -26,357 | -4,442 | ' |
Total assets | 1,369,962 | 1,658,324 | ' |
Total capital expenditures | 66,311 | 112,344 | ' |
Canadian Upstream | ' | ' | ' |
Details of operating activities by segment | ' | ' | ' |
Total revenue | 0 | 0 | ' |
Depletion, depreciation, amortization and accretion | 0 | 0 | ' |
Loss (gain) on sale of assets, net | 0 | 0 | ' |
Other operating expenses | 0 | 0 | ' |
Other income (expense) | 0 | 0 | ' |
Income (loss) from continuing operations before income tax | 0 | 0 | ' |
Income tax benefit | ' | 0 | ' |
Income from discontinued operations, net of tax | -825 | 356 | ' |
Net income (loss) | -825 | 356 | ' |
Total assets | 64,147 | 262,320 | ' |
Total capital expenditures | 308 | 12,256 | ' |
Midstream and Marketing | ' | ' | ' |
Details of operating activities by segment | ' | ' | ' |
Total revenue | 34,735 | 17,302 | ' |
Depletion, depreciation, amortization and accretion | 3,678 | 2,687 | ' |
Loss (gain) on sale of assets, net | 0 | 0 | ' |
Other operating expenses | 32,070 | 14,668 | ' |
Other income (expense) | 30 | -1,095 | ' |
Income (loss) from continuing operations before income tax | -983 | -1,148 | ' |
Income tax benefit | ' | 0 | ' |
Income from discontinued operations, net of tax | 0 | 0 | ' |
Net income (loss) | -983 | -1,148 | ' |
Total assets | 322,030 | 240,861 | ' |
Total capital expenditures | 30,634 | 22,295 | ' |
Oilfield Services | ' | ' | ' |
Details of operating activities by segment | ' | ' | ' |
Total revenue | 7,911 | 3,731 | ' |
Depletion, depreciation, amortization and accretion | 791 | 338 | ' |
Loss (gain) on sale of assets, net | 2 | 0 | ' |
Other operating expenses | 6,713 | 3,699 | ' |
Other income (expense) | -209 | -89 | ' |
Income (loss) from continuing operations before income tax | 196 | -395 | ' |
Income tax benefit | ' | 0 | ' |
Income from discontinued operations, net of tax | 0 | 0 | ' |
Net income (loss) | 196 | -395 | ' |
Total assets | 45,021 | 29,121 | ' |
Total capital expenditures | 690 | 7,956 | ' |
Corporate Unallocated | ' | ' | ' |
Details of operating activities by segment | ' | ' | ' |
Total revenue | 0 | 0 | ' |
Depletion, depreciation, amortization and accretion | 0 | 0 | ' |
Loss (gain) on sale of assets, net | 0 | 0 | ' |
Other operating expenses | 10,488 | 15,990 | ' |
Other income (expense) | -23,244 | -23,126 | ' |
Income (loss) from continuing operations before income tax | -33,732 | -39,116 | ' |
Income tax benefit | ' | 45 | ' |
Income from discontinued operations, net of tax | 0 | 0 | ' |
Net income (loss) | -33,732 | -39,071 | ' |
Total assets | 98,526 | 125,233 | ' |
Total capital expenditures | 23 | 172 | ' |
Inter-segment Eliminations | ' | ' | ' |
Details of operating activities by segment | ' | ' | ' |
Total revenue | -5,376 | -1,444 | ' |
Depletion, depreciation, amortization and accretion | 0 | 0 | ' |
Loss (gain) on sale of assets, net | 0 | 0 | ' |
Other operating expenses | -5,223 | -1,444 | ' |
Other income (expense) | 0 | 82 | ' |
Income (loss) from continuing operations before income tax | -153 | 82 | ' |
Income tax benefit | ' | 0 | ' |
Income from discontinued operations, net of tax | 153 | -82 | ' |
Net income (loss) | 0 | 0 | ' |
Total assets | -5,833 | -1,930 | ' |
Total capital expenditures | $0 | $0 | ' |
CONDENSED_CONSOLIDATING_GUARAN2
CONDENSED CONSOLIDATING GUARANTOR FINANCIAL STATEMENTS (Details) (USD $) | 3 Months Ended | ||
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 | Dec. 31, 2013 |
Condensed Financial Statements, Captions [Line Items] | ' | ' | ' |
Net income (loss) | ($61,701) | ($44,700) | ' |
ASSETS | ' | ' | ' |
Current assets | 156,172 | ' | 120,726 |
Property and equipment (using successful efforts method of accounting) | 1,538,485 | ' | 1,514,079 |
Total assets | 1,893,853 | 2,313,929 | 1,856,651 |
LIABILITIES AND SHAREHOLDERS’ EQUITY | ' | ' | ' |
Current liabilities | 250,016 | ' | 183,865 |
Redeemable preferred stock | 242,275 | ' | 236,675 |
Shareholders’ equity | 405,670 | ' | 450,730 |
Total liabilities and shareholders’ equity | 1,893,853 | ' | 1,856,651 |
Magnum Hunter Resources Corporation | ' | ' | ' |
Condensed Financial Statements, Captions [Line Items] | ' | ' | ' |
Net income (loss) | -67,819 | -48,845 | ' |
100% Owned Guarantor Subsidiaries | ' | ' | ' |
Condensed Financial Statements, Captions [Line Items] | ' | ' | ' |
Net income (loss) | -21,681 | -20,095 | ' |
Non Guarantor Subsidiaries | ' | ' | ' |
Condensed Financial Statements, Captions [Line Items] | ' | ' | ' |
Net income (loss) | -861 | 6,823 | ' |
Eliminations | ' | ' | ' |
Condensed Financial Statements, Captions [Line Items] | ' | ' | ' |
Net income (loss) | 28,660 | 17,417 | ' |
Magnum Hunter Resources Corporation Consolidated | ' | ' | ' |
Condensed Financial Statements, Captions [Line Items] | ' | ' | ' |
Net income (loss) | -61,701 | -44,700 | ' |
Debt Securities Under Universal Shelf Registration Statement Form S-4 | Magnum Hunter Resources Corporation | ' | ' | ' |
Condensed Financial Statements, Captions [Line Items] | ' | ' | ' |
Net income (loss) | -67,819 | -48,845 | ' |
ASSETS | ' | ' | ' |
Current assets | 75,046 | ' | 53,161 |
Intercompany accounts receivable | 953,626 | ' | 965,138 |
Property and equipment (using successful efforts method of accounting) | 6,362 | ' | 7,214 |
Investment in subsidiaries | 347,169 | ' | 372,236 |
Other assets | 17,118 | ' | 17,308 |
Total assets | 1,399,321 | ' | 1,415,057 |
LIABILITIES AND SHAREHOLDERS’ EQUITY | ' | ' | ' |
Current liabilities | 76,184 | ' | 54,826 |
Intercompany accounts payable | 0 | ' | 0 |
Long-term liabilities | 826,507 | ' | 818,651 |
Redeemable preferred stock | 100,000 | ' | 100,000 |
Shareholders’ equity | 396,630 | ' | 441,580 |
Total liabilities and shareholders’ equity | 1,399,321 | ' | 1,415,057 |
Debt Securities Under Universal Shelf Registration Statement Form S-4 | 100% Owned Guarantor Subsidiaries | ' | ' | ' |
Condensed Financial Statements, Captions [Line Items] | ' | ' | ' |
Net income (loss) | -21,681 | -20,095 | ' |
ASSETS | ' | ' | ' |
Current assets | 64,639 | ' | 43,841 |
Intercompany accounts receivable | ' | ' | ' |
Property and equipment (using successful efforts method of accounting) | 1,269,856 | ' | 1,272,027 |
Investment in subsidiaries | 102,469 | ' | 102,314 |
Other assets | 86,675 | ' | 100,894 |
Total assets | 1,523,639 | ' | 1,519,076 |
LIABILITIES AND SHAREHOLDERS’ EQUITY | ' | ' | ' |
Current liabilities | 131,868 | ' | 97,520 |
Intercompany accounts payable | 911,751 | ' | 921,237 |
Long-term liabilities | 40,506 | ' | 39,067 |
Redeemable preferred stock | 0 | ' | 0 |
Shareholders’ equity | 439,514 | ' | 461,252 |
Total liabilities and shareholders’ equity | 1,523,639 | ' | 1,519,076 |
Debt Securities Under Universal Shelf Registration Statement Form S-4 | Non Guarantor Subsidiaries | ' | ' | ' |
Condensed Financial Statements, Captions [Line Items] | ' | ' | ' |
Net income (loss) | -861 | 6,823 | ' |
ASSETS | ' | ' | ' |
Current assets | 22,320 | ' | 27,096 |
Intercompany accounts receivable | ' | ' | ' |
Property and equipment (using successful efforts method of accounting) | 262,267 | ' | 234,838 |
Investment in subsidiaries | ' | ' | ' |
Other assets | 95,403 | ' | 103,644 |
Total assets | 379,990 | ' | 365,578 |
LIABILITIES AND SHAREHOLDERS’ EQUITY | ' | ' | ' |
Current liabilities | 47,832 | ' | 34,929 |
Intercompany accounts payable | 41,843 | ' | 43,866 |
Long-term liabilities | 128,879 | ' | 127,663 |
Redeemable preferred stock | 142,275 | ' | 136,675 |
Shareholders’ equity | 19,161 | ' | 22,445 |
Total liabilities and shareholders’ equity | 379,990 | ' | 365,578 |
Debt Securities Under Universal Shelf Registration Statement Form S-4 | Eliminations | ' | ' | ' |
Condensed Financial Statements, Captions [Line Items] | ' | ' | ' |
Net income (loss) | 28,660 | 17,417 | ' |
ASSETS | ' | ' | ' |
Current assets | -5,833 | ' | -3,372 |
Intercompany accounts receivable | -953,626 | ' | -965,138 |
Property and equipment (using successful efforts method of accounting) | ' | ' | ' |
Investment in subsidiaries | -449,638 | ' | -474,550 |
Other assets | ' | ' | ' |
Total assets | -1,409,097 | ' | -1,443,060 |
LIABILITIES AND SHAREHOLDERS’ EQUITY | ' | ' | ' |
Current liabilities | -5,868 | ' | -3,410 |
Intercompany accounts payable | -953,594 | ' | -965,103 |
Long-term liabilities | 0 | ' | 0 |
Redeemable preferred stock | 0 | ' | 0 |
Shareholders’ equity | -449,635 | ' | -474,547 |
Total liabilities and shareholders’ equity | -1,409,097 | ' | -1,443,060 |
Debt Securities Under Universal Shelf Registration Statement Form S-4 | Magnum Hunter Resources Corporation Consolidated | ' | ' | ' |
Condensed Financial Statements, Captions [Line Items] | ' | ' | ' |
Net income (loss) | -61,701 | -44,700 | ' |
ASSETS | ' | ' | ' |
Current assets | 156,172 | ' | 120,726 |
Intercompany accounts receivable | 0 | ' | 0 |
Property and equipment (using successful efforts method of accounting) | 1,538,485 | ' | 1,514,079 |
Investment in subsidiaries | 0 | ' | 0 |
Other assets | 199,196 | ' | 221,846 |
Total assets | 1,893,853 | ' | 1,856,651 |
LIABILITIES AND SHAREHOLDERS’ EQUITY | ' | ' | ' |
Current liabilities | 250,016 | ' | 183,865 |
Intercompany accounts payable | 0 | ' | 0 |
Long-term liabilities | 995,892 | ' | 985,381 |
Redeemable preferred stock | 242,275 | ' | 236,675 |
Shareholders’ equity | 405,670 | ' | 450,730 |
Total liabilities and shareholders’ equity | $1,893,853 | ' | $1,856,651 |
CONDENSED_CONSOLIDATING_GUARAN3
CONDENSED CONSOLIDATING GUARANTOR FINANCIAL STATEMENTS (Details 2) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Condensed consolidating statements of operations | ' | ' |
Revenues | $107,444 | $54,234 |
Income (loss) from continuing operations before income taxes | -37,901 | -66,362 |
Income tax benefit | 0 | 4,899 |
Income (loss) from continuing operations | -37,901 | -61,463 |
Income from discontinued operations, net of tax | 3,362 | 16,763 |
Loss on disposal of discontinued operations, net of tax | -27,162 | 0 |
Net income (loss) | -61,701 | -44,700 |
Net loss attributed to non-controlling interests | 109 | 503 |
Net income (loss) attributable to Magnum Hunter Resources Corporation | -61,592 | -44,197 |
Dividends on preferred stock | -14,896 | -13,488 |
Net income (loss) attributable to common shareholders | -76,488 | -57,685 |
Magnum Hunter Resources Corporation | ' | ' |
Condensed consolidating statements of operations | ' | ' |
Net income (loss) | -67,819 | -48,845 |
100% Owned Guarantor Subsidiaries | ' | ' |
Condensed consolidating statements of operations | ' | ' |
Net income (loss) | -21,681 | -20,095 |
Non Guarantor Subsidiaries | ' | ' |
Condensed consolidating statements of operations | ' | ' |
Net income (loss) | -861 | 6,823 |
Eliminations | ' | ' |
Condensed consolidating statements of operations | ' | ' |
Net income (loss) | 28,660 | 17,417 |
Magnum Hunter Resources Corporation Consolidated | ' | ' |
Condensed consolidating statements of operations | ' | ' |
Net income (loss) | -61,701 | -44,700 |
Debt Securities Under Universal Shelf Registration Statement Form S-4 | Magnum Hunter Resources Corporation | ' | ' |
Condensed consolidating statements of operations | ' | ' |
Revenues | 108 | -175 |
Expenses | 34,793 | 39,632 |
Loss from continuing operations before equity in net income of subsidiary | -34,685 | -39,807 |
Equity in net income of subsidiary | -28,815 | -9,083 |
Income (loss) from continuing operations before income taxes | -63,500 | -48,890 |
Income tax benefit | ' | 45 |
Income (loss) from continuing operations | -63,500 | -48,845 |
Income from discontinued operations, net of tax | 0 | 0 |
Loss on disposal of discontinued operations, net of tax | -4,319 | 0 |
Net income (loss) | -67,819 | -48,845 |
Net loss attributed to non-controlling interests | 0 | 0 |
Net income (loss) attributable to Magnum Hunter Resources Corporation | -67,819 | -48,845 |
Dividends on preferred stock | -8,820 | -8,906 |
Net income (loss) attributable to common shareholders | -76,639 | -57,751 |
Debt Securities Under Universal Shelf Registration Statement Form S-4 | 100% Owned Guarantor Subsidiaries | ' | ' |
Condensed consolidating statements of operations | ' | ' |
Revenues | 104,014 | 47,362 |
Expenses | 107,084 | 71,673 |
Loss from continuing operations before equity in net income of subsidiary | -3,070 | -24,311 |
Equity in net income of subsidiary | 155 | -529 |
Income (loss) from continuing operations before income taxes | -2,915 | -24,840 |
Income tax benefit | ' | 4,854 |
Income (loss) from continuing operations | -2,915 | -19,986 |
Income from discontinued operations, net of tax | -117 | -109 |
Loss on disposal of discontinued operations, net of tax | -18,649 | 0 |
Net income (loss) | -21,681 | -20,095 |
Net loss attributed to non-controlling interests | 0 | 0 |
Net income (loss) attributable to Magnum Hunter Resources Corporation | -21,681 | -20,095 |
Dividends on preferred stock | 0 | 0 |
Net income (loss) attributable to common shareholders | -21,681 | -20,095 |
Debt Securities Under Universal Shelf Registration Statement Form S-4 | Non Guarantor Subsidiaries | ' | ' |
Condensed consolidating statements of operations | ' | ' |
Revenues | 8,698 | 8,491 |
Expenses | 8,692 | 10,817 |
Loss from continuing operations before equity in net income of subsidiary | 6 | -2,326 |
Equity in net income of subsidiary | 0 | -7,805 |
Income (loss) from continuing operations before income taxes | 6 | -10,131 |
Income tax benefit | ' | 0 |
Income (loss) from continuing operations | 6 | -10,131 |
Income from discontinued operations, net of tax | 3,327 | 16,954 |
Loss on disposal of discontinued operations, net of tax | -4,194 | 0 |
Net income (loss) | -861 | 6,823 |
Net loss attributed to non-controlling interests | 0 | 0 |
Net income (loss) attributable to Magnum Hunter Resources Corporation | -861 | 6,823 |
Dividends on preferred stock | -6,076 | -4,582 |
Net income (loss) attributable to common shareholders | -6,937 | 2,241 |
Debt Securities Under Universal Shelf Registration Statement Form S-4 | Eliminations | ' | ' |
Condensed consolidating statements of operations | ' | ' |
Revenues | -5,376 | -1,444 |
Expenses | -5,224 | -1,526 |
Loss from continuing operations before equity in net income of subsidiary | -152 | 82 |
Equity in net income of subsidiary | 28,660 | 17,417 |
Income (loss) from continuing operations before income taxes | 28,508 | 17,499 |
Income tax benefit | ' | 0 |
Income (loss) from continuing operations | 28,508 | 17,499 |
Income from discontinued operations, net of tax | 152 | -82 |
Loss on disposal of discontinued operations, net of tax | 0 | 0 |
Net income (loss) | 28,660 | 17,417 |
Net loss attributed to non-controlling interests | 109 | 503 |
Net income (loss) attributable to Magnum Hunter Resources Corporation | 28,769 | 17,920 |
Dividends on preferred stock | 0 | 0 |
Net income (loss) attributable to common shareholders | 28,769 | 17,920 |
Debt Securities Under Universal Shelf Registration Statement Form S-4 | Magnum Hunter Resources Corporation Consolidated | ' | ' |
Condensed consolidating statements of operations | ' | ' |
Revenues | 107,444 | 54,234 |
Expenses | 145,345 | 120,596 |
Loss from continuing operations before equity in net income of subsidiary | -37,901 | -66,362 |
Equity in net income of subsidiary | 0 | 0 |
Income (loss) from continuing operations before income taxes | -37,901 | -66,362 |
Income tax benefit | ' | 4,899 |
Income (loss) from continuing operations | -37,901 | -61,463 |
Income from discontinued operations, net of tax | 3,362 | 16,763 |
Loss on disposal of discontinued operations, net of tax | -27,162 | 0 |
Net income (loss) | -61,701 | -44,700 |
Net loss attributed to non-controlling interests | 109 | 503 |
Net income (loss) attributable to Magnum Hunter Resources Corporation | -61,592 | -44,197 |
Dividends on preferred stock | -14,896 | -13,488 |
Net income (loss) attributable to common shareholders | ($76,488) | ($57,685) |
CONDENSED_CONSOLIDATING_GUARAN4
CONDENSED CONSOLIDATING GUARANTOR FINANCIAL STATEMENTS CONDENSED CONSOLIDATING GUARANTOR FINANCIAL STATEMENTS (Details 3) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Condensed Financial Statements, Captions [Line Items] | ' | ' |
Net income (loss) | ($61,701) | ($44,700) |
Foreign currency translation loss | -2,348 | -4,729 |
Unrealized gain (loss) on available for sale securities | -56 | -17 |
COMPREHENSIVE LOSS | -64,105 | -49,446 |
Comprehensive loss attributable to non-controlling interests | 109 | 503 |
COMPREHENSIVE LOSS ATTRIBUTABLE TO MAGNUM HUNTER RESOURCES CORPORATION | -63,996 | -48,943 |
Magnum Hunter Resources Corporation | ' | ' |
Condensed Financial Statements, Captions [Line Items] | ' | ' |
Net income (loss) | -67,819 | -48,845 |
Foreign currency translation loss | 0 | 0 |
Unrealized gain (loss) on available for sale securities | 0 | 0 |
COMPREHENSIVE LOSS | -67,819 | -48,845 |
Comprehensive loss attributable to non-controlling interests | 0 | 0 |
COMPREHENSIVE LOSS ATTRIBUTABLE TO MAGNUM HUNTER RESOURCES CORPORATION | -67,819 | -48,845 |
100% Owned Guarantor Subsidiaries | ' | ' |
Condensed Financial Statements, Captions [Line Items] | ' | ' |
Net income (loss) | -21,681 | -20,095 |
Foreign currency translation loss | 0 | 0 |
Unrealized gain (loss) on available for sale securities | -56 | -17 |
COMPREHENSIVE LOSS | -21,737 | -20,112 |
Comprehensive loss attributable to non-controlling interests | 0 | 0 |
COMPREHENSIVE LOSS ATTRIBUTABLE TO MAGNUM HUNTER RESOURCES CORPORATION | -21,737 | -20,112 |
Non-Guarantor Subsidiaries [Member] | ' | ' |
Condensed Financial Statements, Captions [Line Items] | ' | ' |
Net income (loss) | -861 | 6,823 |
Foreign currency translation loss | -2,348 | -4,729 |
Unrealized gain (loss) on available for sale securities | 0 | 0 |
COMPREHENSIVE LOSS | -3,209 | 2,094 |
Comprehensive loss attributable to non-controlling interests | 0 | 0 |
COMPREHENSIVE LOSS ATTRIBUTABLE TO MAGNUM HUNTER RESOURCES CORPORATION | -3,209 | 2,094 |
Eliminations | ' | ' |
Condensed Financial Statements, Captions [Line Items] | ' | ' |
Net income (loss) | 28,660 | 17,417 |
Foreign currency translation loss | 0 | 0 |
Unrealized gain (loss) on available for sale securities | 0 | 0 |
COMPREHENSIVE LOSS | 28,660 | 17,417 |
Comprehensive loss attributable to non-controlling interests | 109 | 503 |
COMPREHENSIVE LOSS ATTRIBUTABLE TO MAGNUM HUNTER RESOURCES CORPORATION | 28,769 | 17,920 |
Magnum Hunter Resources Corporation Consolidated | ' | ' |
Condensed Financial Statements, Captions [Line Items] | ' | ' |
Net income (loss) | -61,701 | -44,700 |
Foreign currency translation loss | -2,348 | -4,729 |
Unrealized gain (loss) on available for sale securities | -56 | -17 |
COMPREHENSIVE LOSS | -64,105 | -49,446 |
Comprehensive loss attributable to non-controlling interests | 109 | 503 |
COMPREHENSIVE LOSS ATTRIBUTABLE TO MAGNUM HUNTER RESOURCES CORPORATION | ($63,996) | ($48,943) |
CONDENSED_CONSOLIDATING_GUARAN5
CONDENSED CONSOLIDATING GUARANTOR FINANCIAL STATEMENTS (Details 4) (USD $) | 3 Months Ended | ||
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 | Dec. 31, 2011 |
Schedule of condensed consolidating statements of cash flows | ' | ' | ' |
Cash flow from operating activities | $3,877 | $77,621 | ' |
Cash flow from operating activities | -22,819 | -144,437 | ' |
Cash flow from investing activities | 41,656 | 100,390 | ' |
Effect of changes in exchange rate on cash | 25 | -21 | ' |
Net increase (decrease) in cash | 22,739 | 33,553 | ' |
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD | 41,713 | ' | 57,623 |
CASH AND CASH EQUIVALENTS, END OF PERIOD | 64,452 | 91,176 | 57,623 |
Debt Securities Under Universal Shelf Registration Statement Form S-4 | Magnum Hunter Resources Corporation | ' | ' | ' |
Schedule of condensed consolidating statements of cash flows | ' | ' | ' |
Cash flow from operating activities | -8,779 | -33,357 | ' |
Cash flow from operating activities | -181 | -142 | ' |
Cash flow from investing activities | 31,886 | 100,852 | ' |
Effect of changes in exchange rate on cash | ' | ' | ' |
Net increase (decrease) in cash | 22,926 | 67,353 | ' |
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD | 47,895 | 26,871 | ' |
CASH AND CASH EQUIVALENTS, END OF PERIOD | 70,821 | 94,224 | ' |
Debt Securities Under Universal Shelf Registration Statement Form S-4 | 100% Owned Guarantor Subsidiaries | ' | ' | ' |
Schedule of condensed consolidating statements of cash flows | ' | ' | ' |
Cash flow from operating activities | 4,611 | 89,742 | ' |
Cash flow from operating activities | -4,070 | -89,577 | ' |
Cash flow from investing activities | 4,050 | 402 | ' |
Effect of changes in exchange rate on cash | ' | ' | ' |
Net increase (decrease) in cash | 4,591 | 567 | ' |
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD | -17,651 | -12,582 | ' |
CASH AND CASH EQUIVALENTS, END OF PERIOD | -13,060 | -12,015 | ' |
Debt Securities Under Universal Shelf Registration Statement Form S-4 | Non Guarantor Subsidiaries | ' | ' | ' |
Schedule of condensed consolidating statements of cash flows | ' | ' | ' |
Cash flow from operating activities | 8,045 | 22,072 | ' |
Cash flow from operating activities | -18,568 | -54,718 | ' |
Cash flow from investing activities | 5,720 | -864 | ' |
Effect of changes in exchange rate on cash | 25 | -21 | ' |
Net increase (decrease) in cash | -4,778 | -33,531 | ' |
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD | 11,469 | 43,334 | ' |
CASH AND CASH EQUIVALENTS, END OF PERIOD | 6,691 | 9,803 | ' |
Debt Securities Under Universal Shelf Registration Statement Form S-4 | Eliminations | ' | ' | ' |
Schedule of condensed consolidating statements of cash flows | ' | ' | ' |
Cash flow from operating activities | ' | -836 | ' |
Cash flow from operating activities | ' | ' | ' |
Cash flow from investing activities | ' | ' | ' |
Effect of changes in exchange rate on cash | ' | ' | ' |
Net increase (decrease) in cash | ' | -836 | ' |
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD | ' | ' | ' |
CASH AND CASH EQUIVALENTS, END OF PERIOD | ' | -836 | ' |
Debt Securities Under Universal Shelf Registration Statement Form S-4 | Magnum Hunter Resources Corporation Consolidated | ' | ' | ' |
Schedule of condensed consolidating statements of cash flows | ' | ' | ' |
Cash flow from operating activities | 3,877 | 77,621 | ' |
Cash flow from operating activities | -22,819 | -144,437 | ' |
Cash flow from investing activities | 41,656 | 100,390 | ' |
Effect of changes in exchange rate on cash | 25 | -21 | ' |
Net increase (decrease) in cash | 22,739 | 33,553 | ' |
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD | 41,713 | 57,623 | ' |
CASH AND CASH EQUIVALENTS, END OF PERIOD | $64,452 | $91,176 | ' |
SUBSEQUENT_EVENTS_Details
SUBSEQUENT EVENTS (Details) | Mar. 31, 2014 | Dec. 31, 2013 | Apr. 21, 2014 | Apr. 21, 2014 | Apr. 10, 2014 | Apr. 10, 2014 | Apr. 14, 2014 | Apr. 14, 2014 | Mar. 31, 2014 | Apr. 17, 2014 |
In Millions, except Share data, unless otherwise specified | Eureka Hunter Holdings, LLC | Eureka Hunter Holdings, LLC | Subsequent Event | Subsequent Event | Subsequent Event | Subsequent Event | Subsequent Event | Ridgeline Midstream Holdings, LLC | Eureka Hunter Pipeline Credit Agreement | Eureka Hunter Pipeline Credit Agreement |
Magnum Hunter Production and Williston Hunter Canada | Magnum Hunter Production and Williston Hunter Canada | Magnum Hunter Production and Williston Hunter Canada | Magnum Hunter Production and Williston Hunter Canada | Eureka Hunter Holdings, LLC | Subsequent Event | Line of Credit [Member] | Line of Credit [Member] | |||
USD ($) | CAD | USD ($) | CAD | Series A Preferred Units | Eureka Hunter Holdings, LLC | USD ($) | Subsequent Event | |||
USD ($) | Series A Preferred Units | USD ($) | ||||||||
USD ($) | ||||||||||
Subsequent Event [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Cash consideration on sale of certain oil and gas properties and assets | ' | ' | ' | ' | $8.70 | 9.5 | ' | ' | ' | ' |
Preferred units issued | ' | ' | ' | ' | ' | ' | 410,000 | ' | ' | ' |
Proceeds from Issuance of Preferred Units | ' | ' | ' | ' | ' | ' | 8 | ' | ' | ' |
Maximum purchase commitment amount | ' | ' | ' | ' | ' | ' | ' | 200 | ' | ' |
Consolidated controlling interest (as a percent) | 55.79% | 56.40% | ' | ' | ' | ' | 42.98% | ' | ' | ' |
Additional borrowing | ' | ' | ' | ' | ' | ' | ' | ' | ' | 10 |
Credit facility amount outstanding | ' | ' | ' | ' | ' | ' | ' | ' | 65 | ' |
Cash consideration received | ' | ' | $67.50 | 75 | ' | ' | ' | ' | ' | ' |
SUBSEQUENT_EVENTS_Amendment_to
SUBSEQUENT EVENTS (Amendment to Credit Agreement) (Details) (Amendment to Third Amended and Restated Credit Agreement [Member], USD $) | Dec. 31, 2013 | 6-May-14 | 6-May-14 | 6-May-14 | 6-May-14 | 6-May-14 | 6-May-14 | 6-May-14 | 6-May-14 | Dec. 31, 2013 | 6-May-14 | 6-May-14 | 6-May-14 | 6-May-14 | 6-May-14 | 6-May-14 | 6-May-14 | 6-May-14 | 6-May-14 | 6-May-14 | 6-May-14 |
In Millions, unless otherwise specified | Line of Credit [Member] | Line of Credit [Member] | Line of Credit [Member] | Line of Credit [Member] | Line of Credit [Member] | Line of Credit [Member] | Line of Credit [Member] | Line of Credit [Member] | Line of Credit [Member] | Letter of Credit [Member] | Letter of Credit [Member] | Alternate Base Rate [Member] | Eurodollar [Member] | Maximum | Maximum | Maximum | Maximum | Minimum | Minimum | Minimum | Minimum |
Subsequent Event | Period On or Before July 1, 2014 [Member] | Period July 1, 2014 [Member] | Subsequent Event | Fiscal Quarters Ending June 30, 2014 and September 30, 2014 [Member] | Subsequent Event | Fiscal Quarter Ending December 31, 2014 [Member] | Fiscal Quarter Ending March 31, 2015 and Each Quarter Thereafter [Member] | Subsequent Event | Line of Credit [Member] | Line of Credit [Member] | Alternate Base Rate [Member] | Alternate Base Rate [Member] | Eurodollar [Member] | Eurodollar [Member] | Alternate Base Rate [Member] | Alternate Base Rate [Member] | Eurodollar [Member] | Eurodollar [Member] | |||
Subsequent Event | Subsequent Event | Subsequent Event | Subsequent Event | Subsequent Event | Period May 6, 2014 Through July 1, 2014 [Member] | Period May 6, 2014 Through July 1, 2014 [Member] | Line of Credit [Member] | Line of Credit [Member] | Line of Credit [Member] | Line of Credit [Member] | Line of Credit [Member] | Line of Credit [Member] | Line of Credit [Member] | Line of Credit [Member] | |||||||
Subsequent Event | Subsequent Event | Period From July 1, 2014 Through Date of Delivery of Compliance Certificate for Quarter Ending June 30, 2014 [Member] | Period From Delivery of Compliance Certificate and After [Member] | Period From July 1, 2014 Through Date of Delivery of Compliance Certificate for Quarter Ending June 30, 2014 [Member] | Period From Delivery of Compliance Certificate and After [Member] | Period From July 1, 2014 Through Date of Delivery of Compliance Certificate for Quarter Ending June 30, 2014 [Member] | Period From Delivery of Compliance Certificate and After [Member] | Period From July 1, 2014 Through Date of Delivery of Compliance Certificate for Quarter Ending June 30, 2014 [Member] | Period From Delivery of Compliance Certificate and After [Member] | ||||||||||||
Subsequent Event | Subsequent Event | Subsequent Event | Subsequent Event | Subsequent Event | Subsequent Event | Subsequent Event | Subsequent Event | ||||||||||||||
Subsequent Event [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Borrowing base | $232.50 | $325 | ' | ' | ' | ' | ' | ' | ' | $10 | $50 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Borrowing capacity limit increase | ' | 750 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Reduction of borrowing base | ' | ' | $25 | $25 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Reduction of borrowing base, percent of net proceeds from issuance of common equity | ' | ' | 50.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Reduction of borrowing base, ratio of Senior Notes | ' | ' | ' | 0.25 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Applicable margin | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2.75% | 3.75% | 2.25% | 1.75% | 3.25% | 2.75% | 1.50% | 1.00% | 2.50% | 2.00% |
Required minimum consolidated Current Ratio | ' | 1 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
EBITDAX to interest expense | ' | ' | ' | ' | 200.00% | 225.00% | 250.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Required maximum ratio of Total Debt to EBITDAX | ' | ' | ' | ' | ' | 4.75 | ' | 4.5 | 4.25 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Liens percentage used in reserve reports for borrowing base determinations | 80.00% | 90.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |