Cover
Cover - shares | 9 Months Ended | |
Sep. 30, 2023 | Nov. 02, 2023 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Sep. 30, 2023 | |
Document Transition Report | false | |
Entity File Number | 001-36057 | |
Entity Registrant Name | Ring Energy, Inc. | |
Entity Incorporation, State or Country Code | NV | |
Entity Tax Identification Number | 90-0406406 | |
Entity Address, Address Line One | 1725 Hughes Landing Blvd., | |
Entity Address, Address Line Two | Suite 900 | |
Entity Address, City or Town | The Woodlands | |
Entity Address, State or Province | TX | |
Entity Address, Postal Zip Code | 77380 | |
City Area Code | 281 | |
Local Phone Number | 397-3699 | |
Title of 12(b) Security | Common Stock, par value $0.001 | |
Trading Symbol | REI | |
Security Exchange Name | NYSEAMER | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 195,630,301 | |
Entity Central Index Key | 0001384195 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false |
CONDENSED BALANCE SHEETS
CONDENSED BALANCE SHEETS - USD ($) | Sep. 30, 2023 | Dec. 31, 2022 |
Current Assets | ||
Cash and cash equivalents | $ 138,581 | $ 3,712,526 |
Accounts receivable | 45,756,047 | 42,448,719 |
Joint interest billing receivables, net | 3,306,125 | 983,802 |
Derivative assets | 1,845,133 | 4,669,162 |
Inventory | 5,548,835 | 9,250,717 |
Prepaid expenses and other assets | 2,033,013 | 2,101,538 |
Total Current Assets | 58,627,734 | 63,166,464 |
Properties and Equipment | ||
Oil and natural gas properties, full cost method | 1,628,230,243 | 1,463,838,595 |
Financing lease asset subject to depreciation | 3,306,372 | 3,019,476 |
Fixed assets subject to depreciation | 2,946,274 | 3,147,125 |
Total Properties and Equipment | 1,634,482,889 | 1,470,005,196 |
Accumulated depreciation, depletion and amortization | (353,111,293) | (289,935,259) |
Net Properties and Equipment | 1,281,371,596 | 1,180,069,937 |
Operating lease asset | 2,644,519 | 1,735,013 |
Derivative assets | 6,465,355 | 6,129,410 |
Deferred financing costs | 14,199,738 | 17,898,973 |
Total Assets | 1,363,308,942 | 1,268,999,797 |
Current Liabilities | ||
Accounts payable | 110,392,713 | 111,398,268 |
Income tax liability | 264,261 | 0 |
Financing lease liability | 806,993 | 709,653 |
Operating lease liability | 503,420 | 398,362 |
Derivative liabilities | 23,906,800 | 13,345,619 |
Notes payable | 950,068 | 499,880 |
Deferred cash payment | 14,783,879 | 14,807,276 |
Asset retirement obligations | 279,681 | 635,843 |
Total Current Liabilities | 151,887,815 | 141,794,901 |
Non-current Liabilities | ||
Deferred income taxes | 497,067 | 8,499,016 |
Revolving line of credit | 428,000,000 | 415,000,000 |
Financing lease liability, less current portion | 690,456 | 1,052,479 |
Operating lease liability, less current portion | 2,207,248 | 1,473,897 |
Derivative liabilities | 18,089,847 | 10,485,650 |
Asset retirement obligations | 28,482,982 | 29,590,463 |
Total Liabilities | 629,855,415 | 607,896,406 |
Commitments and contingencies | ||
Stockholders' Equity | ||
Preferred stock - $0.001 par value; 50,000,000 shares authorized; no shares issued or outstanding | 0 | 0 |
Common stock - $0.001 par value; 450,000,000 shares authorized; 195,380,527 shares and 175,530,212 shares issued and outstanding, respectively | 195,380 | 175,530 |
Additional paid-in capital | 793,603,238 | 775,241,114 |
Accumulated deficit | (60,345,091) | (114,313,253) |
Total Stockholders’ Equity | 733,453,527 | 661,103,391 |
Total Liabilities and Stockholders' Equity | $ 1,363,308,942 | $ 1,268,999,797 |
CONDENSED BALANCE SHEETS (Paren
CONDENSED BALANCE SHEETS (Parenthetical) - $ / shares | Sep. 30, 2023 | Dec. 31, 2022 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized (in shares) | 50,000,000 | 50,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized (in shares) | 450,000,000 | 450,000,000 |
Common stock, shares, issued (in shares) | 195,380,527 | 175,530,212 |
Common stock, shares, outstanding (in shares) | 195,380,527 | 175,530,212 |
CONDENSED STATEMENTS OF OPERATI
CONDENSED STATEMENTS OF OPERATIONS - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Income Statement [Abstract] | ||||
Oil, Natural Gas, and Natural Gas Liquids Revenues | $ 93,681,798 | $ 94,408,948 | $ 261,113,283 | $ 247,551,855 |
Costs and Operating Expenses | ||||
Lease operating expenses | 18,015,348 | 13,029,098 | 51,426,145 | 30,283,706 |
Gathering, transportation and processing costs | (4,530) | 0 | (6,985) | 1,846,247 |
Ad valorem taxes | 1,779,163 | 1,199,385 | 5,120,119 | 3,100,578 |
Oil and natural gas production taxes | 4,753,289 | 4,563,519 | 13,173,568 | 11,939,338 |
Depreciation, depletion and amortization | 21,989,034 | 14,324,502 | 64,053,637 | 34,854,993 |
Asset retirement obligation accretion | 354,175 | 243,140 | 1,073,900 | 617,685 |
Operating lease expense | 138,220 | 83,590 | 366,711 | 250,770 |
General and administrative expense | 7,083,574 | 7,393,848 | 21,023,956 | 18,748,427 |
Total Costs and Operating Expenses | 54,108,273 | 40,837,082 | 156,231,051 | 101,641,744 |
Income from Operations | 39,573,525 | 53,571,866 | 104,882,232 | 145,910,111 |
Other Income (Expense) | ||||
Interest income | 80,426 | 4 | 160,171 | 4 |
Interest (expense) | (11,381,754) | (7,021,385) | (32,322,840) | (13,699,045) |
Gain (loss) on derivative contracts | (39,222,755) | 32,851,189 | (26,483,190) | (2,201,970) |
Gain (loss) on disposal of assets | 0 | 0 | (132,109) | 0 |
Other income | 0 | 0 | 126,210 | 0 |
Net Other Income (Expense) | (50,524,083) | 25,829,808 | (58,651,758) | (15,901,011) |
Income (Loss) Before Benefit from (Provision for) Income Taxes | (10,950,558) | 79,401,674 | 46,230,474 | 130,009,100 |
Benefit from (Provision for) Income Taxes | 3,411,336 | (4,315,783) | 7,737,688 | (5,866,744) |
Net Income (Loss) | $ (7,539,222) | $ 75,085,891 | $ 53,968,162 | $ 124,142,356 |
Basic Earnings (Loss) per Share (in usd per share) | $ (0.04) | $ 0.65 | $ 0.29 | $ 1.16 |
Diluted Earnings (Loss) per Share (in usd per share) | $ (0.04) | $ 0.49 | $ 0.28 | $ 0.92 |
CONDENSED STATEMENTS OF STOCKHO
CONDENSED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) | Total | Common Stock | Additional Paid-in Capital | Retained Earnings (Accumulated Deficit) |
Beginning balance (in shares) at Dec. 31, 2021 | 100,192,562 | |||
Beginning balance at Dec. 31, 2021 | $ 300,624,207 | $ 100,193 | $ 553,472,292 | $ (252,948,278) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Share-based compensation | 1,521,910 | 1,521,910 | ||
Net income (loss) | 7,112,043 | 7,112,043 | ||
Ending balance (in shares) at Mar. 31, 2022 | 100,192,562 | |||
Ending balance at Mar. 31, 2022 | 309,258,160 | $ 100,193 | 554,994,202 | (245,836,235) |
Beginning balance (in shares) at Dec. 31, 2021 | 100,192,562 | |||
Beginning balance at Dec. 31, 2021 | 300,624,207 | $ 100,193 | 553,472,292 | (252,948,278) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Net income (loss) | 124,142,356 | |||
Ending balance (in shares) at Sep. 30, 2022 | 131,586,927 | |||
Ending balance at Sep. 30, 2022 | 506,170,948 | $ 131,587 | 634,845,283 | (128,805,922) |
Beginning balance (in shares) at Mar. 31, 2022 | 100,192,562 | |||
Beginning balance at Mar. 31, 2022 | 309,258,160 | $ 100,193 | 554,994,202 | (245,836,235) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Induced exercise of common warrants issued in offering (in shares) | 6,453,907 | |||
Induced exercise of common warrants issued in offering | 5,163,126 | $ 6,454 | 5,156,672 | |
Options exercised (in shares) | 100,000 | |||
Options exercised | 0 | $ 100 | (100) | |
Shares elected to be withheld for options exercised (in shares) | (47,506) | |||
Shares elected to be withheld for options exercised | 0 | $ (48) | 48 | |
Restricted stock vested (in shares) | 610,195 | |||
Restricted stock vested | 0 | $ 610 | (610) | |
Shares to cover tax withholding for restricted stock vested (in shares) | (73,047) | |||
Shares to cover tax withholdings for restricted stock vested | 0 | $ (73) | 73 | |
Payments to cover tax withholdings for restricted stock vested, net | (257,694) | (257,694) | ||
Share-based compensation | 1,899,245 | 1,899,245 | ||
Net income (loss) | 41,944,422 | 41,944,422 | ||
Ending balance (in shares) at Jun. 30, 2022 | 107,236,111 | |||
Ending balance at Jun. 30, 2022 | 358,007,259 | $ 107,236 | 561,791,836 | (203,891,813) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Induced exercise of common warrants issued in offering (in shares) | 3,000,000 | |||
Induced exercise of common warrants issued in offering | 2,400,000 | $ 3,000 | 2,397,000 | |
Restricted stock vested (in shares) | 13,504 | |||
Restricted stock vested | 0 | $ 14 | (14) | |
Shares to cover tax withholding for restricted stock vested (in shares) | (2,674) | |||
Shares to cover tax withholdings for restricted stock vested | 0 | $ (3) | 3 | |
Payments to cover tax withholdings for restricted stock vested, net | $ (6,790) | (6,790) | ||
Common stock issuance for Stronghold acquisition (in shares) | 21,339,986 | |||
Common stock issuance for Stronghold acquisition | $ 69,141,555 | $ 21,340 | 69,120,215 | |
Share-based compensation | 1,543,033 | 1,543,033 | ||
Net income (loss) | 75,085,891 | 75,085,891 | ||
Ending balance (in shares) at Sep. 30, 2022 | 131,586,927 | |||
Ending balance at Sep. 30, 2022 | 506,170,948 | $ 131,587 | 634,845,283 | (128,805,922) |
Beginning balance (in shares) at Dec. 31, 2022 | 175,530,212 | |||
Beginning balance at Dec. 31, 2022 | 661,103,391 | $ 175,530 | 775,241,114 | (114,313,253) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Induced exercise of common warrants issued in offering (in shares) | 4,517,427 | |||
Induced exercise of common warrants issued in offering | 3,613,941 | $ 4,517 | 3,609,424 | |
Restricted stock vested (in shares) | 659,479 | |||
Restricted stock vested | 0 | $ 659 | (659) | |
Shares to cover tax withholding for restricted stock vested (in shares) | (79,634) | |||
Shares to cover tax withholdings for restricted stock vested | 0 | $ (79) | 79 | |
Payments to cover tax withholdings for restricted stock vested, net | (134,381) | (134,381) | ||
Share-based compensation | 1,943,696 | 1,943,696 | ||
Net income (loss) | 32,715,779 | 32,715,779 | ||
Ending balance (in shares) at Mar. 31, 2023 | 180,627,484 | |||
Ending balance at Mar. 31, 2023 | 699,242,426 | $ 180,627 | 780,659,273 | (81,597,474) |
Beginning balance (in shares) at Dec. 31, 2022 | 175,530,212 | |||
Beginning balance at Dec. 31, 2022 | 661,103,391 | $ 175,530 | 775,241,114 | (114,313,253) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Net income (loss) | 53,968,162 | |||
Ending balance (in shares) at Sep. 30, 2023 | 195,380,527 | |||
Ending balance at Sep. 30, 2023 | 733,453,527 | $ 195,380 | 793,603,238 | (60,345,091) |
Beginning balance (in shares) at Mar. 31, 2023 | 180,627,484 | |||
Beginning balance at Mar. 31, 2023 | 699,242,426 | $ 180,627 | 780,659,273 | (81,597,474) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Induced exercise of common warrants issued in offering (in shares) | 14,512,166 | |||
Induced exercise of common warrants issued in offering | 8,687,655 | $ 14,512 | 8,673,143 | |
Restricted stock vested (in shares) | 288,709 | |||
Restricted stock vested | 0 | $ 289 | (289) | |
Shares to cover tax withholding for restricted stock vested (in shares) | (77,687) | |||
Shares to cover tax withholdings for restricted stock vested | 0 | $ (78) | 78 | |
Payments to cover tax withholdings for restricted stock vested, net | (141,682) | (141,682) | ||
Share-based compensation | 2,260,312 | 2,260,312 | ||
Net income (loss) | 28,791,605 | 28,791,605 | ||
Ending balance (in shares) at Jun. 30, 2023 | 195,350,672 | |||
Ending balance at Jun. 30, 2023 | 738,840,316 | $ 195,350 | 791,450,835 | (52,805,869) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Restricted stock vested (in shares) | 39,443 | |||
Restricted stock vested | 0 | $ 39 | (39) | |
Shares to cover tax withholding for restricted stock vested (in shares) | (9,588) | |||
Shares to cover tax withholdings for restricted stock vested | 0 | $ (9) | 9 | |
Payments to cover tax withholdings for restricted stock vested, net | (18,302) | (18,302) | ||
Share-based compensation | 2,170,735 | 2,170,735 | ||
Net income (loss) | (7,539,222) | (7,539,222) | ||
Ending balance (in shares) at Sep. 30, 2023 | 195,380,527 | |||
Ending balance at Sep. 30, 2023 | $ 733,453,527 | $ 195,380 | $ 793,603,238 | $ (60,345,091) |
CONDENSED STATEMENTS OF CASH FL
CONDENSED STATEMENTS OF CASH FLOWS - USD ($) | 9 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Cash Flows From Operating Activities | ||
Net income (loss) | $ 53,968,162 | $ 124,142,356 |
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | ||
Depreciation, depletion and amortization | 64,053,637 | 34,854,993 |
Asset retirement obligation accretion | 1,073,900 | 617,685 |
Amortization of deferred financing costs | 3,699,235 | 1,483,621 |
Share-based compensation | 6,374,743 | 4,964,188 |
Bad debt expense | 41,865 | 0 |
Deferred income tax expense (benefit) | (8,160,712) | 5,830,008 |
Excess tax expense (benefit) related to share-based compensation | 158,763 | 0 |
(Gain) loss on derivative contracts | 26,483,190 | 2,201,970 |
Cash received (paid) for derivative settlements, net | (5,829,728) | (48,593,882) |
Changes in operating assets and liabilities: | ||
Accounts receivable | (5,671,516) | (21,300,907) |
Inventory | 3,701,882 | 0 |
Prepaid expenses and other assets | 68,525 | (2,308,540) |
Accounts payable | 3,500,913 | 33,992,075 |
Settlement of asset retirement obligation | (1,025,607) | (2,548,344) |
Net Cash Provided by Operating Activities | 142,437,252 | 133,335,223 |
Cash Flows From Investing Activities | ||
Payments to purchase oil and natural gas properties | (1,605,262) | (1,211,691) |
Payments to develop oil and natural gas properties | (112,996,032) | (83,776,050) |
Payments to acquire or improve fixed assets subject to depreciation | (209,798) | (158,598) |
Sale of fixed assets subject to depreciation | 332,230 | 134,600 |
Proceeds from divestiture of equipment for oil and natural gas properties | 54,558 | 25,066 |
Net Cash (Used in) Investing Activities | (170,917,037) | (268,346,299) |
Cash Flows From Financing Activities | ||
Proceeds from revolving line of credit | 179,000,000 | 592,000,000 |
Payments on revolving line of credit | (166,000,000) | (447,000,000) |
Proceeds from issuance of common stock from warrant exercises | 12,301,596 | 7,563,126 |
Payments for taxes withheld on vested restricted shares, net | (294,365) | (264,484) |
Proceeds from notes payable | 1,565,071 | 1,245,303 |
Payments on notes payable | (1,114,883) | (954,082) |
Payment of deferred financing costs | 0 | (18,762,502) |
Reduction of financing lease liabilities | (551,579) | (334,034) |
Net Cash Provided by (Used in) Financing Activities | 24,905,840 | 133,493,327 |
Net Increase (Decrease) in Cash | (3,573,945) | (1,517,749) |
Cash at Beginning of Period | 3,712,526 | 2,408,316 |
Cash at End of Period | 138,581 | 890,567 |
Supplemental Cash Flow Information | ||
Cash paid for interest | 27,804,707 | 12,371,753 |
Noncash Investing and Financing Activities | ||
Asset retirement obligation incurred during development | 261,786 | 218,082 |
Asset retirement obligation acquired | 2,090,777 | 14,538,550 |
Revision of estimate | 53,824 | 0 |
Asset retirement obligation sold | (4,717,507) | 0 |
Operating lease assets obtained in exchange for new operating lease liability | 1,713,677 | 0 |
Financing lease assets obtained in exchange for new financing lease liability | 305,052 | 0 |
Capitalized expenditures attributable to drilling projects financed through current liabilities | (1,394,081) | 13,233,975 |
Delaware Basin | ||
Cash Flows From Investing Activities | ||
Proceeds from sale of Delaware properties | 7,608,692 | 0 |
New Mexico Divestiture | ||
Cash Flows From Investing Activities | ||
Proceeds from sale of Delaware properties | 4,312,502 | 0 |
Stronghold Acquisition | ||
Cash Flows From Investing Activities | ||
Payments for the Stronghold Acquisition | (18,511,170) | (183,359,626) |
Investing Activities - Cash Paid | ||
Deposit in escrow | 0 | 46,500,000 |
Cash paid by bank to Stronghold on closing | 0 | 121,392,455 |
Direct transaction costs | 0 | 9,162,143 |
Cash paid for realized August oil derivative losses | 0 | 1,777,925 |
Cash paid for inventory and fixed assets acquired | 0 | 4,527,103 |
Payment of deferred cash payment | 15,000,000 | 0 |
Payment of post-close settlement | 3,511,170 | 0 |
Payments for the Stronghold Acquisition | 18,511,170 | 183,359,626 |
Investing Activities - Noncash | ||
Assumption of suspense liability | 0 | 1,651,596 |
Assumption of asset retirement obligation | 0 | 14,538,550 |
Assumption of derivative liabilities | 0 | 24,784,406 |
Deferred cash payment at fair value | 0 | 14,511,688 |
Financing Activities - Noncash | ||
Common stock issued for acquisition | 0 | 69,141,555 |
Convertible preferred stock issued for acquisition | 0 | 137,858,446 |
Founders Acquisition | ||
Cash Flows From Investing Activities | ||
Payments for the Stronghold Acquisition | (49,902,757) | 0 |
Investing Activities - Cash Paid | ||
Deposit in escrow | 7,500,000 | 0 |
Cash paid by bank to Stronghold on closing | 42,502,799 | 0 |
Interest from escrow deposit | 1,747 | 0 |
Direct transaction costs | 1,361,843 | 0 |
Post-close adjustments | (1,463,632) | 0 |
Payments for the Stronghold Acquisition | 49,902,757 | 0 |
Investing Activities - Noncash | ||
Assumption of suspense liability | 677,116 | 0 |
Assumption of asset retirement obligation | 2,090,777 | 0 |
Assumption of ad valorem tax liability | 234,051 | 0 |
Deferred cash payment at fair value | $ 14,657,383 | $ 0 |
BASIS OF PRESENTATION AND SIGNI
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES | 9 Months Ended |
Sep. 30, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES | NOTE 1 — BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES Condensed Financial Statements – The accompanying condensed financial statements prepared by Ring Energy, Inc., a Nevada corporation (the “Company,” "Ring Energy," “Ring,” "we," "us," or "our"), have not been audited by an independent registered public accounting firm. In the opinion of the Company’s management, the accompanying unaudited condensed financial statements contain all adjustments necessary for fair presentation of the results of operations for the periods presented, which adjustments were of a normal recurring nature, except as disclosed herein. The condensed results of operations for the three and nine months ended September 30, 2023, are not necessarily indicative of the results to be expected for the full year ending December 31, 2023, for various reasons, including the impact of fluctuations in prices received for oil and natural gas, natural production declines, the uncertainty of exploration and development drilling results, fluctuations in the fair value of derivative instruments, and other factors. These unaudited condensed financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) applicable to interim financial information, and, accordingly, do not include all of the information and notes required by GAAP for complete financial statements. Therefore, these condensed financial statements should be read in conjunction with the financial statements and notes included in the Company’s annual report on Form 10-K for the year ended December 31, 2022. Organization and Nature of Operations – Ring Energy is a growth oriented independent exploration and production company based in The Woodlands, Texas engaged in oil and natural gas development, production, acquisition, and exploration activities currently focused in Texas. Our primary drilling operations target the oil and liquids rich producing formations in the Northwest Shelf and the Central Basin Platform, both of which are part of the Permian Basin. Liquidity and Capital Considerations – The Company strives to maintain an adequate liquidity level to address volatility and risk. Sources of liquidity include the Company’s cash flow from operations, cash on hand, available borrowing capacity under its revolving credit facility, and proceeds from sales of non-strategic assets. While changes in oil and natural gas prices affect the Company’s liquidity, the Company has put in place hedges in seeking to protect a substantial portion of its cash flows from price declines; however, if oil or natural gas prices rapidly deteriorate due to unanticipated economic conditions, this could still have a material adverse effect on the Company’s cash flows. The Company expects ongoing oil price volatility over an indeterminate term. Extended depressed oil prices have historically had and could have a material adverse impact on the Company’s oil revenue, which is mitigated to some extent by the Company’s hedge contracts. The Company is always mindful of oil price volatility and its impact on our liquidity. The Company believes that it has the ability to continue to fund its operations and service its debt by using cash flows from operations. Use of Estimates – The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities and the reported amounts of revenues and expenses during the reporting period. The Company’s unaudited condensed financial statements are based on a number of significant estimates, including estimates of oil and natural gas reserve quantities, which are the basis for the calculation of depletion and impairment of oil and gas properties. Reserve estimates, by their nature, are inherently imprecise. Actual results could differ from those estimates. Changes in the future estimated oil and natural gas reserves or the estimated future cash flows attributable to the reserves that are utilized for impairment analysis could have a significant impact on the Company’s future results of operations. Fair Value Measurements - Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). The Financial Accounting Standards Board (“FASB”) has established a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. This hierarchy consists of three broad levels. Level 1 inputs are the highest priority and consist of unadjusted quoted prices in active markets for identical assets and liabilities. Level 2 are inputs other than quoted prices that are observable for the asset or liability, either directly or indirectly. Level 3 are unobservable inputs for an asset or liability. Fair Values of Financial Instruments – The carrying amounts reported for our revolving line of credit approximate their fair value because the underlying instruments are at interest rates which approximate current market rates. The carrying amounts of accounts receivables and accounts payable and other current assets and liabilities approximate fair value because of the short-term maturities and/or liquid nature of these assets and liabilities. Fair Value of Non-financial Assets and Liabilities – The Company also applies fair value accounting guidance to initially, or as events dictate, measure non-financial assets and liabilities such as those obtained through business acquisitions, property and equipment and asset retirement obligations. These assets and liabilities are subject to fair value adjustments only in certain circumstances and are not subject to recurring revaluations. Fair value may be estimated using comparable market data, a discounted cash flow method, or a combination of the two as considered appropriate based on the circumstances. Under the discounted cash flow method, estimated future cash flows are based on management’s expectations for the future and include estimates of future oil and natural gas production or other applicable sales estimates, operational costs and a risk-adjusted discount rate. The Company may use the present value of estimated future cash inflows and/or outflows or third-party offers or prices of comparable assets with consideration of current market conditions to value its non-financial assets and liabilities when circumstances dictate determining fair value is necessary. Given the significance of the unobservable nature of a number of the inputs, these are considered Level 3 on the fair value hierarchy. Derivative Instruments and Hedging Activities – The Company periodically enters into derivative contracts to manage its exposure to commodity price risk. These derivative contracts, which are generally placed with major financial institutions, may take the form of forward contracts, futures contracts, swaps or options. The oil and gas reference prices upon which the commodity derivative contracts are based reflect various market indices that have a high degree of historical correlation with actual prices received by the Company for its oil and gas production. As the Company has not designated its derivative instruments as hedges for accounting purposes, any gains or losses resulting from changes in fair value of outstanding derivative financial instruments and from the settlement of derivative financial instruments are recognized in earnings and included as a component of other income (expense) in the Condensed Statements of Operations. When applicable, the Company records all derivative instruments, other than those that meet the normal purchases and sales exception, on the balance sheet as either an asset or liability measured at fair value. Changes in fair value are recognized currently in earnings unless specific hedge accounting criteria are met. See "NOTE 6 — DERIVATIVE FINANCIAL INSTRUMENTS" below for additional information. Concentration of Credit Risk and Receivables – Financial instruments that potentially subject the Company to a concentration of credit risk consist principally of cash and receivables. Cash and cash equivalents - The Company had cash in excess of federally insured limits of $0 and $3,462,526 as of September 30, 2023 and December 31, 2022, respectively. The Company places its cash with a high credit quality financial institution. The Company has not experienced any losses in such accounts and believes it is not exposed to significant credit risk in this area. Accounts receivable - Substantially all of the Company’s accounts receivable is from purchasers of oil and natural gas. Oil and natural gas sales are generally unsecured. The Company has not had any significant credit losses in the past and believes its accounts receivable are fully collectable. During the nine months ended September 30, 2023, sales to three purchasers represented 67%, 12% and 10%, respectively, of total oil, natural gas, and natural gas liquids sales. As of September 30, 2023, receivables outstanding from these three purchasers represented 69%, 9% and 7%, respectively, of accounts receivable. Production imbalances - The Company accounts for natural gas production imbalances using the sales method, which recognizes revenue on all natural gas sold even though the natural gas volumes sold may be more or less than the Company's ownership entitles it to sell. Liabilities are recorded for imbalances greater than the Company’s proportionate share of remaining estimated natural gas reserves. The Company recorded no imbalances as of September 30, 2023 or December 31, 2022. Joint interest billing receivables, net - The Company also has joint interest billing receivables. Joint interest billing receivables are collateralized by the pro rata revenue attributable to the joint interest holders and further by the interest itself. Accounts receivable from joint interest owners or purchasers outstanding longer than the contractual payment terms are considered past due. The following table indicates the Company's provisions for bad debt expense associated with its joint interest billing receivables during the three and nine months ended September 30, 2023 and September 30, 2022. For the Three Months Ended For the Nine Months Ended September 30, 2023 September 30, 2022 September 30, 2023 September 30, 2022 Bad debt expense $ 19,656 $ — $ 41,865 $ — The following table reflects the Company's joint interest billing receivables and allowance for credit losses as of September 30, 2023 and December 31, 2022. September 30, 2023 December 31, 2022 Joint interest billing receivables $ 3,484,616 $ 1,226,049 Allowance for credit losses (178,491) (242,247) Joint interest billing receivables, net $ 3,306,125 $ 983,802 The reduction of $63,756 in the allowance for credit losses during the nine months ended September 30, 2023 was primarily due to a clearing of $105,620 in allowances that were associated with the Delaware Basin asset sale, offset by new allowances booked (see NOTE 5 — ACQUISITIONS AND DIVESTITURES for more detail). Cash and Cash Equivalents – The Company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents. At September 30, 2023 and December 31, 2022, the Company had no such investments. Inventory - The full balance of the Company's inventory consists of materials and supplies for its operations, with no work in process or finished goods inventory balances. Inventory is added to the books upon the purchase of supplies (inclusive of freight and sales tax costs) to use on well sites, and inventory is reduced by material transfers for inventory usage based on the initial invoiced value. The Company reports the balance of its inventory at the lower of cost or net realizable value. Inventory balances are excluded from the Company's calculation of depletion. Oil and Natural Gas Properties – The Company uses the full cost method of accounting for oil and natural gas properties. Under this method, all costs (direct and indirect) associated with acquisition, exploration, and development of oil and natural gas properties are capitalized. Costs capitalized include acquisition costs, geological and geophysical expenditures, lease rentals on undeveloped properties and costs of drilling and equipping productive and non-productive wells. Drilling costs include directly related overhead costs. Capitalized costs are categorized either as being subject to amortization or not subject to amortization. All of the Company’s capitalized costs, excluding inventory, are subject to amortization. The Company records a liability in the period in which an asset retirement obligation (“ARO”) is incurred, in an amount equal to the discounted estimated fair value of the obligation that is capitalized. Thereafter this liability is accreted up to the final retirement cost. An ARO is a future expenditure related to the disposal or other retirement of certain assets. The Company’s ARO relates to future plugging and abandonment expenses of its oil and natural gas properties and related facilities disposal. Dispositions of oil and natural gas properties are accounted for as adjustments to capitalized costs. All capitalized costs of oil and natural gas properties, including the estimated future costs to develop proved reserves and estimated future costs to plug and abandon wells and costs of site restoration, less the estimated salvage value of equipment associated with the oil and natural gas properties, are amortized on the unit-of-production method using estimates of proved reserves as determined by independent petroleum engineers. If the results of an assessment indicate that the properties are impaired, the amount of the impairment is offset to the capitalized costs to be amortized. The following table shows total depletion and the depletion per barrel-of-oil-equivalent rate, for the three and nine months ended September 30, 2023 and 2022. For the Three Months Ended For the Nine Months Ended September 30, 2023 September 30, 2022 September 30, 2023 September 30, 2022 Depletion $ 21,711,123 $ 14,163,574 $ 63,203,473 $ 34,417,978 Depletion rate, per barrel-of-oil-equivalent (Boe) $ 13.48 $ 11.59 $ 13.09 $ 11.95 In addition, capitalized costs less accumulated depreciation, depletion and amortization and related deferred income taxes are not allowed to exceed an amount (the full cost ceiling) equal to the sum of: 1) the present value of estimated future net revenues discounted at ten percent computed in compliance with SEC guidelines; 2) plus the cost of properties not being amortized; 3) plus the lower of cost or estimated fair value of unproven properties included in the costs being amortized; 4) less income tax effects related to differences between the book and tax basis of the properties. Land, Buildings, Equipment, Software, Leasehold Improvements, and Automobiles – Land, buildings, equipment, software, leasehold improvements, and automobiles are carried at historical cost, adjusted for impairment loss and accumulated depreciation (except for land). Historical costs include all direct costs associated with the acquisition of land, buildings, equipment, software, leasehold improvements, and automobiles and placing them in service. Upon sale or abandonment, the cost of the fixed asset(s) and related accumulated depreciation are removed from the accounts and any gain or loss is recognized. Depreciation of buildings, equipment, software, leasehold improvements, and automobiles is calculated using the straight-line method based upon the following estimated useful lives: Leasehold improvements 3‑5 years Office equipment and software 3‑7 years Equipment 5‑10 years Automobiles 4 years Buildings and structures 7 years The following table provides information on the Company's depreciation expense for the three and nine months ended September 30, 2023 and 2022. For the Three Months Ended For the Nine Months Ended September 30, 2023 September 30, 2022 September 30, 2023 September 30, 2022 Depreciation $ 80,690 $ 53,946 $ 277,420 $ 102,568 Notes Payable – At the end of May 2023, the Company renewed its control of well, general liability, pollution, umbrella, property, workers' compensation, auto, and D&O (directors and officers) insurance policies, and funded the premiums with a promissory note with a total face value after down payments of $1,565,071. The annual percentage rate (APR) for this note is 7.08%. As of September 30, 2023, the notes payable balance included in current liabilities on the Condensed Balance Sheet is $950,068. The following table shows interest paid related to notes payable for the three and nine months ended September 30, 2023 and 2022. This interest is included within "Interest (expense)" in the Condensed Statements of Operations. Three Months Ended Nine Months Ended September 30, 2023 September 30, 2022 September 30, 2023 September 30, 2022 Interest paid for notes payable $ 22,286 $ 7,917 $ 35,211 $ 17,201 Revenue Recognition – In January 2018, the Company adopted Accounting Standards Update (“ASU”) 2014-09 Revenues from Contracts with Customers (Topic 606) (“ASU 2014-09”). The timing of recognizing revenue from the sale of produced crude oil and natural gas was not changed as a result of adopting ASU 2014-09. The Company predominantly derives its revenue from the sale of produced crude oil and natural gas. The contractual performance obligation is satisfied when the product is delivered to the purchaser. Revenue is recorded in the month the product is delivered to the purchaser. The Company receives payment from one to three months after delivery. The transaction price includes variable consideration as product pricing is based on published market prices and reduced for contract specified differentials (quality, transportation and other variables from benchmark prices). The guidance regarding ASU 2014-09 does not require that the transaction price be fixed or stated in the contract. Estimating the variable consideration does not require significant judgment and Ring engages third party sources to validate the estimates. Revenue is recognized net of royalties due to third parties in an amount that reflects the consideration the Company expects to receive in exchange for those products. See "NOTE 2 — REVENUE RECOGNITION" for additional information. Income Taxes – Provisions for income taxes are based on taxes payable or refundable for the current year and deferred taxes. Deferred taxes are provided on differences between the tax basis of assets and liabilities and their reported amounts in the condensed financial statements, and tax carryforwards. Deferred tax assets and liabilities are included in the condensed financial statements at currently enacted income tax rates applicable to the period in which the deferred tax assets and liabilities are expected to be realized or settled. As changes in tax laws or rates are enacted, deferred tax assets and liabilities are adjusted through the provision for income taxes. Since December 31, 2020, the Company determined that a full valuation allowance was necessary due to the Company's assessment that it was more likely than not that it would be unable to obtain the benefits of its deferred tax assets due to the Company’s history of taxable losses. The Company determined that certain existing deferred tax assets would not be offset by existing deferred tax liabilities as a result of the 80% limitation on the utilization net operating losses incurred after 2017. Since 2021, commodity prices increased and the Company continues to project positive pre-tax book income. As of June 30, 2023, the Company was no longer in a cumulative loss position. As a result, future forecasted pre-tax book income was considered as positive evidence in assessing the valuation allowance. Based on the change in judgment on the realizability of the related federal deferred tax assets in future years, the Company released $10.5 million of valuation allowance as a discrete benefit in the first nine months ended September 30, 2023. Accordingly, the Company recorded the following federal and state income tax benefits (provisions) for the three and nine months ended September 30, 2023 and 2022. For the Three Months Ended For the Nine Months Ended September 30, 2023 September 30, 2022 September 30, 2023 September 30, 2022 Deferred federal income tax benefit (provision) $ 3,381,104 $ (3,611,381) $ 8,492,595 $ (4,625,429) Current state income tax benefit (provision) (165,780) (36,736) (264,261) (36,736) Deferred state income tax benefit (provision) 196,012 (667,666) (490,646) (1,204,579) Benefit from (Provision for) Income Taxes $ 3,411,336 $ (4,315,783) $ 7,737,688 $ (5,866,744) The Company had immaterial operations in New Mexico which is in a net deferred tax asset position for which a full valuation allowance is still recorded. For the three and nine months ended September 30, 2023, the Company’s overall effective tax rates (calculated as Benefit from (Provision for) Income Taxes divided by Income Before Benefit from (Provision for) Income Taxes) were 31.2% and 16.7%, respectively. These rates were primarily impacted by the release of valuation allowance on its federal net deferred tax asset. A tax benefit of $10.5 million was recorded as a discrete item in the nine months ended September 30, 2023. Accounting for Uncertainty in Income Taxes – In accordance with GAAP, the Company has analyzed its filing positions in all jurisdictions where it is required to file income tax returns for the open tax years. The Company has identified its federal income tax return and its franchise tax return in Texas in which it operates as “major” tax jurisdictions. The Company’s federal income tax returns for the years ended December 31, 2018 and after remain subject to examination. The Company’s federal income tax returns for the years ended December 31, 2007 and after remain subject to examination to the extent of the net operating loss (NOL) carryforwards. The Company’s franchise tax returns in Texas remain subject to examination for 2017 and after. The Company currently believes that all significant filing positions are highly certain and that all of its significant income tax filing positions and deductions would be sustained upon audit. Therefore, the Company has no significant reserves for uncertain tax positions and no adjustments to such reserves were required by GAAP. No interest or penalties have been levied against the Company and none are anticipated; therefore, no interest or penalty has been included in our provision for income taxes in the Condensed Statements of Operations. Three-Stream Reporting - Beginning July 1, 2022, the Company began reporting volumes and revenues on a three-stream basis, separately reporting crude oil, natural gas, and natural gas liquids ("NGLs") sales. For periods prior to July 1, 2022, sales and reserve volumes, prices, and revenues for NGLs were presented with natural gas. This represents a change in our accounting and reporting presentation necessitated by a change in the underlying facts and circumstances surrounding the Stronghold Acquisition, as Stronghold had historically reported its revenues on a three-stream basis. As clarified in the interpretive guidance of ASC 250, such changes should not be applied on a retrospective basis. Accordingly, we began reporting on a three-stream basis prospectively, beginning July 1, 2022. See NOTE 5 - ACQUISITIONS AND DIVESTITURES for a discussion of the Stronghold Acquisition. Leases - The Company accounts for its leases in accordance with ASU 2016-02, Leases (Topic 842), effective January 1, 2019. The Company made accounting policy elections to not capitalize leases with a lease term of twelve months or less (i.e. short term leases) and to not separate lease and non-lease components for all asset classes. The Company also elected to adopt the package of practical expedients within ASU 2016-02 that allows an entity to not reassess prior to the effective date (i) whether any expired or existing contracts are or contain leases, (ii) the lease classification for any expired or existing leases, or (iii) initial direct costs for any existing leases, and the practical expedient regarding land easements that exist prior to the adoption of ASU 2016-02. The Company did not elect the practical expedient of hindsight when determining the lease term of existing contracts at the effective date. Earnings (Loss) Per Share – Basic earnings (loss) per share is computed by dividing net income (loss) by the weighted-average number of common shares outstanding during the applicable period. Diluted earnings (loss) per share are calculated to give effect to potentially issuable dilutive common shares. Share-Based Employee Compensation – The Company has outstanding stock option grants and restricted stock unit awards to directors, officers and employees, which are described more fully below in "NOTE 11 — EMPLOYEE STOCK OPTIONS AND RESTRICTED STOCK UNITS". The Company recognizes the cost of employee services received in exchange for an award of equity instruments based on the grant-date fair value of the award and recognizes the related compensation expense over the period during which an employee is required to provide service in exchange for the award, which is generally the vesting period. Share-Based Compensation to Non-Employees – The Company accounts for share-based compensation issued to non-employees as either the fair value of the consideration received or the fair value of the equity instruments issued, whichever is more reliably measurable. The measurement date for these issuances is the earlier of (i) the date at which a commitment for performance by the recipient to earn the equity instruments is reached or (ii) the date at which the recipient’s performance is complete. The following table summarizes the Company's share-based compensation, included with General and administrative expense within our Condensed Statements of Operations, incurred for the three and nine months ended September 30, 2023 and 2022. Three Months Ended Nine Months Ended September 30, 2023 September 30, 2022 September 30, 2023 September 30, 2022 Share-based compensation $ 2,170,735 $ 1,543,033 $ 6,374,743 $ 4,964,188 Recently Adopted Accounting Pronouncements – In July 2023, the FASB issued ASU 2023-03, Presentation of Financial Statements (Topic 205), Income Statement - Reporting Comprehensive Income (Topic 220), Distinguishing Liabilities from Equity (Topic 480), Equity (Topic 505), and Compensation - Stock Compensation (Topic 718): Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 120, SEC Staff Announcement at the March 24, 2022 EITF Meeting, and Staff Accounting Bulletin Topic 6.B, Accounting Series Release 280 - General Revision of Regulation S-X: Income or Loss Applicable to Common Stock. The ASU provided updated views from the SEC Staff on employee and non-employee share-based payment accounting, including guidance related to spring-loaded awards. As the ASU did not provide any new ASC guidance, and there was no transition or effective date provided, the Company adopted this standard upon issuance, and the adoption did not have a material impact on our condensed financial statements. Recent Accounting Pronouncements – In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting (“ASU 2020-04”), which provided optional expedients and exceptions for applying GAAP to contract modifications and hedging relationships, subject to meeting certain criteria, that referenced LIBOR or another rate. ASU 2020-04 was in effect through December 31, 2022. In January 2021, the FASB issued ASU No. 2021-01, Reference Rate Reform (Topic 848): Scope (“ASU 2021-01”), to provide clarifying guidance regarding the scope of Topic 848. ASU 2020-04 was issued to provide optional guidance for a limited period of time to ease the potential burden in accounting for (or recognizing the effects of) reference rate reform on financial reporting. In December 2022, the FASB issued ASU 2022-06, " Reference Rate Reform (Topic 848): Deferral of the Sunset Date of Topic 848" ("ASU 2022-06"), wh ich defers the sunset date of Topic 848 from December 31, 2022 to December 31, 2024. Beginning August 31, 2022, under the Company's Second Amended and Restated Credit Agreement, the Company's interest rates were transitioned from the LIBOR to the SOFR (Standard Overnight Financing Rate) reference rate. At this time, the Company does not plan to enter into additional contracts using LIBOR as a reference rate. In October 2021, the FASB issued ASU 2021-08, " Business Combinations (Topic 805) – Accounting for Contract Assets and Contract Liabilities from Contracts with Customers” ("ASU 2021-08"). This update requires the acquirer in a business combination to record contract asset and liabilities following Topic 606 – “Revenue from Contracts with Customers” at acquisition as if it had originated the contract, rather than at fair value. This update is effective for public business entities beginning after December 15, 2022, with early adoption permitted. The Company continues to evaluate the provisions of this update, but it does not believe the adoption will have a material impact on its financial position, results of operations or liquidity. On July 26, 2023, the SEC issued Final Rule Release No. 33-11216, Cybersecurity Risk Management, Strategy, Governance, and Incident Disclosure , which requires current disclosures (via Form 8-K, Item 1.05) about material cybersecurity incidents and requires periodic disclosures (via Form 10-K, Item 1C, "Cybersecurity") about a registrant’s processes to manage its material cybersecurity risks. The Company is currently considering the impact of this rule on its disclosures. |
REVENUE RECOGNITION
REVENUE RECOGNITION | 9 Months Ended |
Sep. 30, 2023 | |
Revenue from Contract with Customer [Abstract] | |
REVENUE RECOGNITION | NOTE 2 — REVENUE RECOGNITION The Company predominantly derives its revenue from the sale of produced crude oil, natural gas, NGLs. The contractual performance obligation is satisfied when the product is delivered to the purchaser. Revenue is recorded in the month the product is delivered to the purchaser. The Company receives payment from one to three months after delivery. The Company has utilized the practical expedient in Accounting Standards Codification ("ASC") 606-10-50-14, which states an entity is not required to disclose the transaction price allocated to remaining performance obligations if the variable consideration is allocated entirely to a wholly unsatisfied performance obligation. Under the Company’s sales contracts, each unit of production delivered to a purchaser represents a separate performance obligation, therefore, future volumes to be delivered are wholly unsatisfied and disclosure of transaction price allocated to remaining performance obligation is not required. The transaction price includes variable consideration, as product pricing is based on published market prices and adjusted for contract specified differentials such as quality, energy content and transportation. The guidance does not require that the transaction price be fixed or stated in the contract. Estimating the variable consideration does not require significant judgment and the Company engages third party sources to validate the estimates. Revenue is recognized net of royalties due to third parties in an amount that reflects the consideration the Company expects to receive in exchange for those products. Oil sales Under the Company’s oil sales contracts, the Company sells oil production at the point of delivery and collects an agreed upon index price, net of pricing differentials. The Company recognizes revenue at the net price received when control transfers to the purchaser at the point of delivery and it is probable the Company will collect the consideration it is entitled to receive. Natural gas and NGL sales Under the Company’s natural gas sales processing contracts for its Central Basin Platform properties and a portion of its Northwest Shelf assets, the Company delivers unprocessed natural gas to a midstream processing entity at the wellhead. The midstream processing entity obtains control of the natural gas and NGLs at the wellhead. The midstream processing entity gathers and processes the natural gas and NGLs and remits proceeds to the Company for the resulting sale of natural gas and NGLs. Under these processing agreements, the Company recognizes revenue when control transfers to the purchaser at the point of delivery and it is probable the Company will collect the consideration it is entitled to receive. As such, the Company accounts for any fees and deductions as a reduction of the transaction price. Until April 30, 2022, under the Company's natural gas sales processing contracts for the bulk of its Northwest Shelf assets, the Company delivered unprocessed natural gas to a midstream processing entity at the wellhead. However, the Company maintained ownership of the gas through processing and received proceeds from the marketing of the resulting products. Under this processing agreement, the Company recognized the fees associated with the processing as an expense rather than netting these costs against Oil, Natural Gas, and Natural Gas Liquids Revenues in the Condensed Statements of Operations. Beginning May 1, 2022, these contracts were combined into one contract, and it was modified so that the Company no longer maintained ownership of the gas through processing. Accordingly, the Company from that point on accounts for any such fees and deductions as a reduction of the transaction price. Disaggregation of Revenue. The following table presents revenues disaggregated by product: For the Three Months Ended For the Nine Months Ended September 30, 2023 September 30, 2022 September 30, 2023 September 30, 2022 Oil, Natural Gas, and Natural Gas Liquids Revenues Oil $ 90,392,004 $ 86,413,665 $ 252,020,403 $ 229,532,827 Natural gas 562,374 4,655,002 526,161 14,678,747 Natural gas liquids (1) 2,727,420 3,340,281 8,566,719 3,340,281 Total oil, natural gas, and natural gas liquids revenues $ 93,681,798 $ 94,408,948 $ 261,113,283 $ 247,551,855 (1) Beginning on July 1, 2022, the Company began reporting volumes and revenues on a three-stream basis, separately reporting crude oil, natural gas, and NGL sales. For periods prior to July 1, 2022, sales revenues for NGLs were presented with natural gas. |
LEASES
LEASES | 9 Months Ended |
Sep. 30, 2023 | |
Leases [Abstract] | |
LEASES | NOTE 3 — LEASES The Company has operating leases for its offices in Midland, Texas and The Woodlands, Texas. The Midland office is under a five-year lease which began January 1, 2021. The Midland office lease was amended effective October 1, 2022, with the revised five-year lease ending September 30, 2027. Beginning January 15, 2021, the Company entered into a five-and-a-half-year sub-lease for office space in The Woodlands, Texas; however, effective as of May 31, 2023, The Woodlands office sub-lease was terminated. On May 9, 2023, the Company entered into a 71-month (five years and 11-month) new lease for a larger amount of office space in The Woodlands, Texas. At the time of the new lease commencement, the additional office space that was added was under construction and until completed, the rental obligation for this space had not yet commenced, because the Company did not have control of the additional office space in accordance with ASC 842-40-55-5. On September 27, 2023, the Company provided a certificate of acceptance of premises to the lessor of the additional office space, and accordingly, as of September 30, 2023, the future payments for this space are included along with the other operating leases, reflected in the future lease payments schedule below. The Company has month to month leases for office equipment and compressors used in its operations on which the Company has elected to apply ASU 2016-02 (i.e. to not capitalize). The office equipment and compressors are not subject to ASU 2016-02 based on the agreement and nature of use. These leases are for terms that are less than 12 months and the Company does not intend to continue to lease this equipment for more than 12 months. The lease costs associated with these leases is reflected in the short-term lease costs within Lease operating expenses, shown below. The Company has financing leases for vehicles. These leases have a term of 36 months at the end of which the Company owns the vehicles. These vehicles are generally sold at the end of their term and the proceeds applied to a new vehicle. Future lease payments associated with these operating and financing leases as of September 30, 2023 are as follows: 2023 2024 2025 2026 2027 Other Future Years Operating lease payments (1) $ 118,616 $ 675,210 $ 727,460 $ 636,649 $ 460,497 400,234 Financing lease payments (2) 223,492 832,238 493,290 49,763 — — (1) The weighted average annual discount rate as of September 30, 2023 for operating leases was 4.50%. Based on this rate, the future lease payments above include imputed interest of $307,998. The weighted average remaining term of operating leases was 4.51 years. (2) The weighted average annual discount rate as of September 30, 2023 for financing leases was 6.25%. Based on this rate, the future lease payments above include imputed interest of $101,334. The weighted average remaining term of financing leases was 2.00 years. The following table represents a reconciliation between the undiscounted future cash flows in the table above and the operating and financing lease liabilities disclosed in the Condensed Balance Sheets: As of September 30, 2023 December 31, 2022 Operating lease liability, current portion $ 503,420 $ 398,362 Operating lease liability, non-current portion 2,207,248 1,473,897 Operating lease liability, total $ 2,710,668 $ 1,872,259 Total undiscounted future cash flows (sum of future operating lease payments) 3,018,666 2,065,580 Imputed interest 307,998 193,321 Undiscounted future cash flows less imputed interest $ 2,710,668 $ 1,872,259 Financing lease liability, current portion $ 806,993 $ 709,653 Financing lease liability, non-current portion 690,456 1,052,479 Financing lease liability, total $ 1,497,449 $ 1,762,132 Total undiscounted future cash flows (sum of future financing lease payments) 1,598,783 1,900,595 Imputed interest 101,334 138,463 Undiscounted future cash flows less imputed interest $ 1,497,449 $ 1,762,132 The following table provides supplemental information regarding lease costs in the Condensed Statements of Operations: For the Three Months Ended For the Nine Months Ended September 30, 2023 September 30, 2022 September 30, 2023 September 30, 2022 Operating lease costs $ 138,220 $ 83,590 $ 366,711 $ 250,770 Short-term lease costs (1) 1,012,525 639,708 4,042,160 1,937,310 Financing lease costs: Amortization of financing lease assets (2) 197,221 106,982 572,744 334,447 Interest on financing lease liabilities (3) 23,416 10,391 73,115 24,184 (1) Amount included in Lease operating expenses (2) Amount included in Depreciation, depletion and amortization (3) Amount included in Interest (expense) |
EARNINGS (LOSS) PER SHARE INFOR
EARNINGS (LOSS) PER SHARE INFORMATION | 9 Months Ended |
Sep. 30, 2023 | |
Earnings Per Share [Abstract] | |
EARNINGS (LOSS) PER SHARE INFORMATION | NOTE 4 — EARNINGS (LOSS) PER SHARE INFORMATION The following table presents the calculation of the Company's basic and diluted earnings (loss) per share for the three and nine months ended September 30, 2023 and 2022. For the Three Months Ended For the Nine Months Ended September 30, 2023 September 30, 2022 September 30, 2023 September 30, 2022 Net Income (Loss) $ (7,539,222) $ 75,085,891 $ 53,968,162 $ 124,142,356 Basic Weighted-Average Shares Outstanding 195,361,476 115,376,280 188,865,752 107,349,184 Effect of dilutive securities: Stock options — 52,110 — 93,688 Restricted stock units — 1,908,662 1,310,409 2,135,675 Performance stock units — 196,520 361,406 235,440 Common warrants — 19,884,296 4,045,648 20,180,729 Convertible preferred stock — 14,337,127 — 4,831,559 Diluted Weighted-Average Shares Outstanding 195,361,476 151,754,995 194,583,215 134,826,275 Basic Earnings (Loss) per Share $ (0.04) $ 0.65 $ 0.29 $ 1.16 Diluted Earnings (Loss) per Share $ (0.04) $ 0.49 $ 0.28 $ 0.92 The following table presents the securities which were excluded from the Company's computation of diluted earnings per share for the three and nine months ended September 30, 2023 and 2022, as their effect would have been anti-dilutive. For the Three Months Ended For the Nine Months Ended September 30, 2023 September 30, 2022 September 30, 2023 September 30, 2022 Antidilutive securities: Stock options to purchase common stock 265,500 70,500 265,500 70,500 Unvested restricted stock units 3,866,023 37,487 61,212 11,312 Unvested performance stock units 2,882,594 860,212 1,396,446 798,768 |
ACQUISITIONS AND DIVESTITURES
ACQUISITIONS AND DIVESTITURES | 9 Months Ended |
Sep. 30, 2023 | |
Business Combination and Asset Acquisition [Abstract] | |
ACQUISITIONS AND DIVESTITURES | NOTE 5 — ACQUISITIONS AND DIVESTITURES Stronghold Acquisition On July 1, 2022, Ring, as buyer, and Stronghold Energy II Operating, LLC, a Delaware limited liability company (“Stronghold OpCo”) and Stronghold Energy II Royalties, LP, a Delaware limited partnership (“Stronghold RoyaltyCo”, together with Stronghold OpCo, collectively, “Stronghold”), as seller, entered into a purchase and sale agreement (the “Stronghold Purchase Agreement”). Pursuant to the Stronghold Purchase Agreement, Ring acquired (the “Stronghold Acquisition”) interests in oil and gas leases and related property of Stronghold consisting of approximately 37,000 net acres located in the Central Basin Platform of the Texas Permian Basin. On August 31, 2022, Ring completed the Stronghold Acquisition. The fair value of consideration paid to Stronghold was approximately $394.0 million , of which $165.9 million, net of customary purchase price adjustments, was paid in cash at closing, and $15.0 million was paid in cash six months after the closing. Also, shortly after closing, approximately $4.5 million was paid for inventory and vehicles and approximately $1.8 million was paid for August oil derivative settlements for certain novated hedges. The cash portion of the consideration was funded primarily from borrowings under our revolving Credit Facility, which was increased from $350.0 million to $600.0 million at the closing. The remaining consideration consisted of 21,339,986 shares of Ring common stock and 153,176 shares of newly created Series A Convertible Preferred Stock, par value $0.001 (“Preferred Stock”) which were converted into 42,548,892 shares of common stock on October 27, 2022. In addition, Ring assumed $24.8 million of derivative liabilities, $1.7 million of items in suspense, and $14.5 million in asset retirement obligations. Delaware Basin Sale On May 11, 2023, the Company completed the divestiture of its Delaware Basin assets to an unaffiliated party for $8.3 million. The sale had an effective date of March 1, 2023. The final cash consideration was approximately $7.6 million, subject to customary final purchase price adjustments. As part of the divestiture, the buyer assumed an asset retirement obligation balance of approximately $2.3 million. Founders Acquisition On July 10, 2023, the Company, as buyer, and Founders Oil & Gas IV, LLC (“Founders”), as seller, entered into an Asset Purchase Agreement (the “Founders Purchase Agreement”). Pursuant to the closing of the Purchase Agreement, on August 15, 2023 the Company acquired (the “Founders Acquisition”) interests in oil and gas leases and related property of Founders located in the Central Basin Platform of the Texas Permian Basin in Ector County, Texas, for a purchase price (the “Purchase Price”) of (i) a cash deposit of $7.5 million paid on July 11, 2023 into a third-party escrow account as a deposit pursuant to the Founders Purchase Agreement, (ii) approximately $42.5 million in cash paid on the closing date, net of approximately $10 million of preliminary and customary purchase price adjustments with an effective date of April 1, 2023, and (iii) a deferred cash payment of $15.0 million due 4 months after closing, or December 15, 2023, subject to final post-closing settlement between the Company and Founders. The Founders Acquisition has been accounted for as an asset acquisition in accordance with ASC 805. The fair value of the consideration paid by Ring and allocation of that amount to the underlying assets acquired, on a relative fair value basis, was recorded on Ring’s books as of the date of the closing of the Founders Acquisition. Additionally, costs directly related to the Founders Acquisition were capitalized as a component of the purchase price. Determining the fair value of the assets and liabilities acquired requires judgment and certain assumptions to be made, the most significant of these being related to the valuation of Founder’s oil and gas properties. The inputs and assumptions related to the oil and gas properties are categorized as level 3 in the fair value hierarchy. The following table represents the preliminary allocation of the total cost of the Founders Acquisition to the assets acquired and liabilities assumed as of the Founders Acquisition date: Consideration: Cash consideration Escrow deposit released at closing $ 7,500,000 Closing amount paid to Founders 42,502,799 Interest from escrow deposit 1,747 Fair value of deferred payment liability 14,657,383 Post-close adjustments (1,463,632) Total cash consideration $ 63,198,297 Direct transaction costs $ 1,361,843 Total consideration $ 64,560,140 Fair value of assets acquired: Oil and natural gas properties $ 67,562,084 Amount attributable to assets acquired $ 67,562,084 Fair value of liabilities assumed: Suspense liability $ 677,116 Asset retirement obligations 2,090,777 Ad valorem tax liability 234,051 Amount attributable to liabilities assumed $ 3,001,944 Net assets acquired $ 64,560,140 Approximately $6.3 million of revenues and $1.7 million of direct operating expenses attributed to the Founders Acquisition are included in the Company’s Statements of Operations for the period from August 16, 2023 through September 30, 2023. New Mexico Divestiture On September 27, 2023, the Company completed the divestiture of its operated New Mexico assets to an unaffiliated party for $4.5 million, resulting in preliminary cash consideration of approximately $3.8 million, subject to customary final purchase price adjustments. The sale had an effective date of June 1, 2023. As part of the divestiture, the buyer assumed an asset retirement obligation balance of approximately $2.3 million. |
DERIVATIVE FINANCIAL INSTRUMENT
DERIVATIVE FINANCIAL INSTRUMENTS | 9 Months Ended |
Sep. 30, 2023 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
DERIVATIVE FINANCIAL INSTRUMENTS | NOTE 6 — DERIVATIVE FINANCIAL INSTRUMENTS The Company is exposed to fluctuations in crude oil and natural gas prices on its production. It utilizes derivative strategies that consist of either a single derivative instrument or a combination of instruments to manage the variability in cash flows associated with the forecasted sale of our future domestic oil and natural gas production. While the use of derivative instruments may limit or partially reduce the downside risk of adverse commodity price movements, their use also may limit future income from favorable commodity price movements. From time to time, the Company enters into derivative contracts to protect the Company’s cash flow from price fluctuation and maintain its capital programs. The Company has historically used costless collars, deferred premium puts, or swaps for this purpose. Oil derivative contracts are based on WTI (West Texas Intermediate) crude oil prices and natural gas contacts are based on the Henry Hub. A “costless collar” is the combination of two options, a put option (floor) and call option (ceiling) with the options structured so that the premium paid for the put option will be offset by the premium received from selling the call option. Similar to costless collars, there is no cost to enter into the swap contracts. The deferred premium put contract has the premium established upon entering the contract, and due upon settlement of the contract. The use of derivative transactions involves the risk that the counterparties, which generally are financial institutions, will be unable to meet the financial terms of such transactions. All of our derivative contracts are with lenders under our Credit Facility. Non-performance risk is incorporated in the discount rate by adding the quoted bank (counterparty) credit default swap (CDS) rates to the risk free rate. Although the counterparties hold the right to offset (i.e. netting) the settlement amounts with the Company, in accordance with ASC 815-10-50-4B, the Company classifies the fair value of all its derivative positions on a gross basis in the Condensed Balance Sheets. The Company’s derivative financial instruments are recorded at fair value and included as either assets or liabilities in the accompanying Condensed Balance Sheets. The Company has not designated its derivative instruments as hedges for accounting purposes, and, as a result, any gains or losses resulting from changes in fair value of outstanding derivative financial instruments and from the settlement of derivative financial instruments are recognized in earnings and included as a component of "Other Income (Expense)" under the heading "Gain (loss) on derivative contracts" in the accompanying Condensed Statements of Operations. The following presents the impact of the Company’s contracts on its Condensed Balance Sheets for the periods indicated. As of September 30, 2023 December 31, 2022 Commodity derivative instruments, marked to market: Derivative assets, current $ 5,772,513 $ 16,193,327 Discounted deferred premiums (3,927,380) (11,524,165) Derivatives assets, current, net of premiums $ 1,845,133 $ 4,669,162 Derivative assets, noncurrent $ 6,465,355 $ 7,606,258 Discounted deferred premiums — (1,476,848) Derivative assets, noncurrent, net of premiums $ 6,465,355 $ 6,129,410 Derivative liabilities, current $ 23,906,800 $ 13,345,619 Derivative liabilities, noncurrent $ 18,089,847 $ 10,485,650 The components of “Gain (loss) on derivative contracts” from the Condensed Statements of Operations are as follows for the respective periods: For the Three Months Ended For the Nine Months Ended September 30, 2023 September 30, 2022 September 30, 2023 September 30, 2022 Oil derivatives: Realized gain (loss) on oil derivatives $ (5,825,427) $ (13,958,195) $ (7,323,030) $ (47,690,961) Unrealized gain (loss) on oil derivatives (34,077,473) 49,680,492 (21,425,316) 48,360,099 Gain (loss) on oil derivatives $ (39,902,900) $ 35,722,297 $ (28,748,346) $ 669,138 Natural gas derivatives: Realized gain (loss) on natural gas derivatives 474,629 (902,921) 1,493,302 (902,921) Unrealized gain (loss) on natural gas derivatives 205,516 (1,968,187) 771,854 (1,968,187) Gain (loss) on natural gas derivatives $ 680,145 $ (2,871,108) $ 2,265,156 $ (2,871,108) Gain (loss) on derivative contracts $ (39,222,755) $ 32,851,189 $ (26,483,190) $ (2,201,970) The components of “Cash paid for derivative settlements, net” within the Condensed Statements of Cash Flows are as follows for the respective periods: For the Three Months Ended For the Nine Months Ended September 30, 2023 September 30, 2022 September 30, 2023 September 30, 2022 Cash flows from operating activities Cash received (paid) for oil derivatives $ (5,825,427) $ (13,958,195) $ (7,323,030) $ (47,690,961) Cash received (paid) from natural gas derivatives 474,629 (902,921) 1,493,302 (902,921) Cash received (paid) for derivative settlements, net $ (5,350,798) $ (14,861,116) $ (5,829,728) $ (48,593,882) The following tables reflect the details of current derivative contracts as of September 30, 2023 (Quantities are in barrels (Bbl) for the oil derivative contracts and in million British thermal units (MMBtu) for the natural gas derivative contracts): Oil Hedges (WTI) Q4 2023 Q1 2024 Q2 2024 Q3 2024 Q4 2024 Q1 2025 Q2 2025 Q3 2025 Q4 2025 Swaps: Hedged volume (Bbl) 138,000 170,625 156,975 282,900 368,000 — — 184,000 — Weighted average swap price $ 74.52 $ 67.40 $ 66.40 $ 65.49 $ 68.43 $ — $ — $ 73.35 $ — Deferred premium puts: Hedged volume (Bbl) 165,600 45,500 45,500 — — — — — — Weighted average strike price $ 83.78 $ 84.70 $ 82.80 $ — $ — $ — $ — $ — $ — Weighted average deferred premium price $ 14.61 $ 17.15 $ 17.49 $ — $ — $ — $ — $ — $ — Two-way collars: Hedged volume (Bbl) 274,285 339,603 325,847 230,000 128,800 474,750 464,100 184,000 — Weighted average put price $ 56.73 $ 64.20 $ 64.30 $ 64.00 $ 60.00 $ 57.06 $ 60.00 $ 65.00 $ — Weighted average call price $ 70.77 $ 79.73 $ 79.09 $ 76.50 $ 73.24 $ 75.82 $ 69.85 $ 80.08 $ — Three-way collars: Hedged volume (Bbl) 15,598 — — — — — — — — Weighted average first put price $ 45.00 $ — $ — $ — $ — $ — $ — $ — $ — Weighted average second put price $ 55.00 $ — $ — $ — $ — $ — $ — $ — $ — Weighted average call price $ 80.05 $ — $ — $ — $ — $ — $ — $ — $ — Gas Hedges (Henry Hub) Q4 2023 Q1 2024 Q2 2024 Q3 2024 Q4 2024 Q1 2025 Q2 2025 Q3 2025 Q4 2025 NYMEX Swaps: Hedged volume (MMBtu) 134,102 152,113 138,053 121,587 644,946 616,199 591,725 285,200 — Weighted average swap price $ 3.35 $ 3.62 $ 3.61 $ 3.59 $ 4.45 $ 3.78 $ 3.43 $ 3.73 $ — Two-way collars: Hedged volume (MMBtu) 383,587 591,500 568,750 552,000 — — — 285,200 — Weighted average put price $ 3.15 $ 4.00 $ 4.00 $ 4.00 $ — $ — $ — $ 3.00 $ — Call hedged volume (MMBtu) 383,587 591,500 568,750 552,000 — — — 285,200 — Weighted average call price $ 4.51 $ 6.29 $ 6.29 $ 6.29 $ — $ — $ — $ 4.80 $ — Oil Hedges (basis differential) Q4 2023 Q1 2024 Q2 2024 Q3 2024 Q4 2024 Q1 2025 Q2 2025 Q3 2025 Q4 2025 Argus basis swaps: Hedged volume (MMBtu) 305,000 364,000 364,000 368,000 368,000 270,000 273,000 276,000 276,000 Weighted average spread price (1) $ 1.10 $ 1.15 $ 1.15 $ 1.15 $ 1.15 $ 1.00 $ 1.00 $ 1.00 $ 1.00 Gas Hedges (basis differential) Q4 2023 Q1 2024 Q2 2024 Q3 2024 Q4 2024 Q1 2025 Q2 2025 Q3 2025 Q4 2025 Waha basis swaps: Hedged volume (MMBtu) 324,021 — — — — — — — — Weighted average spread price (1) $ 0.55 $ — $ — $ — $ — $ — $ — $ — $ — El Paso Permian Basin basis swaps: Hedged volume (MMBtu) 459,683 — — — — — — — — Weighted average spread price (1) $ 0.63 $ — $ — $ — $ — $ — $ — $ — $ — |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 9 Months Ended |
Sep. 30, 2023 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENTS | NOTE 7 — FAIR VALUE MEASUREMENTS Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). The authoritative guidance requires disclosure of the framework for measuring fair value and requires that fair value measurements be classified and disclosed in one of the following categories: Level 1: Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities. We consider active markets as those in which transactions for the assets or liabilities occur with sufficient frequency and volume to provide pricing information on an ongoing basis. Level 2: Quoted prices in markets that are not active, or inputs that are observable, either directly or indirectly, for substantially the full term of the asset or liability. This category includes those derivative instruments that we value using observable market data. Substantially all of these inputs are observable in the marketplace throughout the full term of the derivative instrument, can be derived from observable data or are supported by observable levels at which transactions are executed in the marketplace. Level 3: Measured based on prices or valuation models that require inputs that are both significant to the fair value measurement and less observable from objective sources (i.e., supported by little or no market activity). Financial assets and liabilities are classified based on the lowest level of input that is significant to the fair value measurement. Our assessment of the significance of a particular input to the fair value measurement requires judgment and may affect the valuation of the fair value of assets and liabilities and their placement within the fair value hierarchy. We continue to evaluate our inputs to ensure the fair value level classification is appropriate. When transfers between levels occur, it is our policy to assume that the transfer occurred at the date of the event or change in circumstances that caused the transfer. The fair values of the Company’s derivatives are not actively quoted in the open market. The Company uses a market approach to estimate the fair values of its derivative instruments on a recurring basis, utilizing commodity futures pricing for the underlying commodities provided by a reputable third party, a Level 2 fair value measurement. The Company applies the provisions of the fair value measurement standard on a non-recurring basis to its non-financial assets and liabilities. These assets and liabilities are not measured at fair value on an ongoing basis but are subject to fair value adjustments if events or changes in certain circumstances indicate that adjustments may be necessary. The following table summarizes the valuation of our assets and liabilities that are measured at fair value on a recurring basis (further detail in "NOTE 6 — DERIVATIVE FINANCIAL INSTRUMENTS"). Fair Value Measurement Classification Quoted prices in Significant Other Significant Total As of December 31, 2022 Commodity Derivatives - Assets $ — $ 10,798,572 $ — $ 10,798,572 Commodity Derivatives - Liabilities $ — $ (23,831,269) $ — $ (23,831,269) Total $ — $ (13,032,697) $ — $ (13,032,697) As of September 30, 2023 Commodity Derivatives - Assets $ — $ 8,310,488 $ — $ 8,310,488 Commodity Derivatives - Liabilities $ — $ (41,996,647) $ — $ (41,996,647) Total $ — $ (33,686,159) $ — $ (33,686,159) The carrying amounts reported for the revolving line of credit approximates fair value because the underlying instruments are at interest rates which approximate current market rates. The carrying amounts of receivables and accounts payable and other current assets and liabilities approximate fair value because of the short-term maturities and/or liquid nature of these assets and liabilities. |
REVOLVING LINE OF CREDIT
REVOLVING LINE OF CREDIT | 9 Months Ended |
Sep. 30, 2023 | |
Debt Disclosure [Abstract] | |
REVOLVING LINE OF CREDIT | NOTE 8 — REVOLVING LINE OF CREDIT On July 1, 2014, the Company entered into a Credit Agreement with SunTrust Bank (now Truist), as lender, issuing bank and administrative agent for several banks and other financial institutions and lenders (the “Administrative Agent”), (which was amended several times) that provided for a maximum borrowing base of $1 billion with security consisting of substantially all of the assets of the Company. In April 2019, the Company amended and restated the Credit Agreement with the Administrative Agent (as amended and restated, the “Credit Facility”). On August 31, 2022, the Company modified its Credit Facility through a Second Amended and Restated Credit Agreement (the "Second Credit Agreement"), extending the maturity date of the facility to August 2026 and the syndicate was modified to add five lenders, replacing five exiting lenders. In conjunction with the Stronghold Acquisition, with the newly acquired assets put up for collateral, the Company established a borrowing base of $600 million. The borrowing base is subject to periodic redeterminations, mandatory reductions and further adjustments from time to time. The borrowing base is redetermined semi-annually each May and November. The borrowing base is subject to reduction in certain circumstances such as the sale or disposition of certain oil and gas properties of the Company or its subsidiaries and cancellation of certain hedging positions. Rather than Eurodollar loans, the reference rate on the Second Credit Agreement is the Standard Overnight Financing Rate (“SOFR”). Also, it permits the Company to declare dividends for its equity owners, subject to certain limitations, including (i) no default or event of default has occurred or will occur upon such payments, (ii) the pro forma Leverage Ratio (outstanding debt to adjusted earnings before interest, taxes, depreciation and amortization, exploration expenses, and all other non-cash charges acceptable to the Administrative Agent) does not exceed 2.00 to 1.00, (iii) the amount of such payments does not exceed Available Free Cash Flow (as defined), and (iv) the Borrowing Base Utilization Percentage (as defined) is not greater than 80%. The interest rate on each SOFR loan is the adjusted term SOFR for the applicable interest period plus a margin between 3.0% and 4.0% (depending on the then-current level of borrowing base usage). The annual interest rate on each base rate loan is (a) the greatest of (i) the Administrative Agent’s prime lending rate, (ii) the Federal Funds Rate (as defined) plus 0.5% per annum, (iii) the adjusted term SOFR determined on a daily basis for an interest period of one month, plus 1.00% per annum and (iv) 0.00% per annum, plus (b) a margin between 2.0% and 3.0% per annum (depending on the then-current level of borrowing base usage). The Second Credit Agreement contains certain covenants, which, among other things, require the maintenance of (i) a total Leverage Ratio of not more than 3.0 to 1.0 and (ii) a minimum ratio of Current Assets to Current Liabilities (as such terms are defined) of 1.0 to 1.0. The Second Credit Agreement also contains other customary affirmative and negative covenants and events of default. The Company is required to maintain on a rolling 24 months basis, hedging transactions in respect of crude oil and natural gas, on not less than 50% of the projected production from its proved, developed, producing oil and gas. However, if the borrowing base utilization is less than 25% at the hedge testing date and the Leverage Ratio is not greater than 1.25 to 1.00, the required hedging percentage for months 13 through 24 of the rolling 24 month period will be 0% from such hedge testing date to the next succeeding hedge testing date and if the borrowing base utilization percentage is equal to or greater than 25%, but less than 50% and the Leverage Ratio is not greater than 1.25 to 1.00, the required hedging percentage for months 13 through 24 of the rolling 24 month period will be 25% from such hedge testing date to the next succeeding hedge testing date. As of September 30, 2023, $428 million was outstanding on the Credit Facility and the Company was in compliance with all covenants in the Second Credit Agreement. |
ASSET RETIREMENT OBLIGATION
ASSET RETIREMENT OBLIGATION | 9 Months Ended |
Sep. 30, 2023 | |
Asset Retirement Obligation Disclosure [Abstract] | |
ASSET RETIREMENT OBLIGATION | NOTE 9 — ASSET RETIREMENT OBLIGATION The Company records the obligation to plug and abandon oil and gas wells at the dates properties are either acquired or the wells are drilled. The asset retirement obligation is adjusted each quarter for any liabilities incurred or settled during the period, accretion expense and any revisions made to the costs or timing estimates. The asset retirement obligation is incurred using an annual credit-adjusted risk-free discount rate at the applicable dates. Changes in the asset retirement obligation during the nine months ended September 30, 2023 were as follows: Balance, December 31, 2022 $ 30,226,306 Liabilities acquired 2,090,777 Liabilities incurred 261,786 Liabilities sold (4,717,507) Liabilities settled (226,424) Revision of estimate 53,824 Accretion expense 1,073,901 Balance, September 30, 2023 $ 28,762,663 The following table presents the Company's current and non-current asset retirement obligation balances as of the periods specified. September 30, 2023 December 31, 2022 Asset retirement obligations, current 279,681 635,843 Asset retirement obligations, non-current 28,482,982 29,590,463 Asset retirement obligations $ 28,762,663 $ 30,226,306 |
STOCKHOLDERS' EQUITY
STOCKHOLDERS' EQUITY | 9 Months Ended |
Sep. 30, 2023 | |
Stockholders' Equity Note [Abstract] | |
STOCKHOLDERS' EQUITY | NOTE 10 — STOCKHOLDERS' EQUITY As of December 31, 2022, the Company had 19,107,793 exercisable common warrants, with a contractual exercise price of $0.80 per warrant, expiring five years from initial issuance in October 2020. During the nine months ended September 30, 2023, a total of 19,029,593 common warrants were exercised. The following table reflects the common warrants exercised, including the proceeds received for such exercises. As of September 30, 2023 there remained 78,200 exercisable common warrants. Common Warrants Exercise Price Proceeds Received Exercisable, December 31, 2021 29,361,700 $ 0.80 Exercised — — $ — Exercisable, March 31, 2022 29,361,700 $ 0.80 Exercised (6,453,907) 0.80 $ 5,163,126 Exercisable, June 30, 2022 22,907,793 $ 0.80 Exercised (3,000,000) 0.80 $ 2,400,000 Exercisable, September 20, 2022 19,907,793 $ 0.80 Exercisable, December 31, 2022 19,107,793 $ 0.80 Exercised (4,517,427) 0.80 $ 3,613,941 Exercisable, March 31, 2023 14,590,366 $ 0.80 Exercised (1) (14,512,166) 0.62 $ 8,997,543 Exercisable, June 30, 2023 78,200 $ 0.80 Exercised — — $ — Exercisable, September 30, 2023 78,200 $ 0.80 (1) On April 11 and 12, 2023, the Company and certain holders of the common warrants (the “Participating Holders”) entered into a form of Warrant Amendment and Exercise Agreement (the “Exercise Agreement”) pursuant to which the Company agreed to reduce the exercise price of an aggregate of 14,512,166 common warrants held by such Participating Holders from $0.80 to $0.62 per share (the “Reduced Exercise Price”) in consideration for the immediate exercise of the common warrants held by such Participating Holders in full at the Reduced Exercise Price in cash. The Company received aggregate gross proceeds of $8,997,543 from the exercise of the common warrants by the Participating Holders pursuant to the Exercise Agreement, which was recognized as an equity issuance cost in accordance with ASC 815-40-35-17(a). In the Statements of Stockholders' Equity, the net impact to Stockholders' Equity is $8,687,655, which is net of $309,888 in advisory fees. |
EMPLOYEE STOCK OPTIONS AND REST
EMPLOYEE STOCK OPTIONS AND RESTRICTED STOCK UNITS | 9 Months Ended |
Sep. 30, 2023 | |
EMPLOYEE STOCK OPTIONS, RESTRICTED STOCK AWARD PLAN AND 401(k) | |
EMPLOYEE STOCK OPTIONS AND RESTRICTED STOCK UNITS | NOTE 11 — EMPLOYEE STOCK OPTIONS AND RESTRICTED STOCK UNITS Compensation expense charged against income for share-based awards during the three and nine months ended September 30, 2023 and 2022 was as follows. These amounts are included in General and administrative expense in the Condensed Statements of Operations. Three Months Ended Nine Months Ended September 30, 2023 September 30, 2022 Sep. 30, 2023 Sep. 30, 2022 Share-based compensation $ 2,170,735 $ 1,543,033 $ 6,374,743 $ 4,964,188 In 2011, the Board approved and adopted a long-term incentive plan (the “2011 Plan”), which was subsequently approved and amended by the shareholders. There were 341,755 shares eligible for grant, either as stock options or as restricted stock, as of September 30, 2023. In 2021, the Board approved and adopted the Ring Energy, Inc. 2021 Omnibus Incentive Plan (the “2021 Plan”), which was subsequently approved by the shareholders at the 2021 Annual Meeting. The 2021 Plan provides that the Company may grant options, stock appreciation rights, restricted shares, restricted stock units, performance-based awards, other share-based awards, other cash-based awards, or any combination of the foregoing. At the 2023 Annual Meeting, the shareholders approved a Plan Amendment to increase the number of shares available under the 2021 Plan by 6.0 million. Accordingly, there were 8,224,394 shares available for grant as of September 30, 2023 under the 2021 Plan. Stock Options A summary of the status of the stock options as of September 30, 2023 and 2022 and changes during the respective nine month periods then ended are as follows: Options Weighted- Weighted-Average Remaining Contractual Term Aggregate Intrinsic Value Outstanding, December 31, 2021 365,500 $ 3.61 Granted — — Forfeited or rescinded — — Exercised — — Outstanding, March 31, 2022 365,500 $ 3.61 2.21 years $ 536,900 Granted — — Forfeited or rescinded — — Exercised (100,000) 2.00 Outstanding, June 30, 2022 265,500 $ 4.21 2.14 years $ 128,700 Granted — — Forfeited or rescinded — — Exercised — — Outstanding, September 30, 2022 265,500 $ 4.21 1.89 years $ 62,400 Exercisable, September 30, 2022 265,500 $ 4.21 1.89 years Outstanding, December 31, 2022 265,500 $ 4.21 Granted — — Forfeited or rescinded — — Exercised — — Outstanding, March 31, 2023 265,500 $ 4.21 1.39 years $ — Granted — — Forfeited or rescinded — — Exercised — — Outstanding, June 30, 2023 265,500 $ 4.21 1.14 years $ — Granted — $ — Forfeited or rescinded — $ — Exercised — $ — Outstanding, September 30, 2023 265,500 $ 4.21 0.89 years $ — Exercisable, September 30, 2023 265,500 $ 4.21 0.89 years The intrinsic values were calculated using the closing price on September 30, 2023 of $1.95 and the closing price on September 30, 2022 of $2.32. As of September 30, 2023, the Company had $0 of unrecognized compensation cost related to stock options. Restricted Stock Units A summary of the restricted stock unit activity as of September 30, 2023 and 2022, respectively, and changes during the respective nine month periods then ended are as follows: Restricted Stock Units Weighted- Outstanding, December 31, 2021 2,572,596 $ 1.75 Granted 1,247,061 2.79 Forfeited or rescinded — — Vested — — Outstanding, March 31, 2022 3,819,657 $ 2.09 Granted 19,642 $ 4.27 Forfeited or rescinded (17,204) $ 2.79 Vested (610,195) $ 2.80 Outstanding, June 30, 2022 3,211,900 $ 1.97 Granted 126,570 2.95 Forfeited or rescinded — — Vested (9,851) 2.69 Outstanding, September 30, 2022 3,328,619 $ 2.00 Outstanding, December 31, 2022 2,623,790 $ 2.29 Granted 2,270,842 2.22 Forfeited or rescinded (11,712) 2.22 Vested (659,479) 2.80 Outstanding, March 31, 2023 4,223,441 $ 2.17 Granted — $ — Forfeited or rescinded (49,465) $ 2.22 Vested (288,709) $ 2.85 Outstanding, June 30, 2023 3,885,267 $ 2.12 Granted — — Forfeited or rescinded (4,997) 2.22 Vested (39,443) 2.87 Outstanding, September 30, 2023 3,840,827 $ 2.12 As of September 30, 2023, the Company had $3,928,247 of unrecognized compensation cost related to restricted stock unit grants that will be recognized over a weighted average period of 1.85 years. Grant activity for the nine months ended September 30, 2023 was primarily restricted stock units for the annual long-term incentive plan awards for employees. Performance Stock Units A summary of the status of the performance stock unit ("PSU") grants as of September 30, 2023 and 2022, respectively, along with changes during the respective nine month periods then ended are as follows: Performance Stock Units Weighted- Outstanding, December 31, 2021 860,216 $ 3.87 Granted 860,216 3.65 Forfeited or rescinded — — Vested — — Outstanding, March 31, 2022 1,720,432 $ 3.76 Granted — $ — Forfeited or rescinded — $ — Vested — $ — Outstanding, June 30, 2022 1,720,432 $ 3.76 Granted — — Forfeited or rescinded — — Vested — — Outstanding, September 30, 2022 1,720,432 $ 3.76 Outstanding, December 31, 2022 1,720,432 $ 3.76 Granted 1,162,162 2.71 Forfeited or rescinded — — Vested — — Outstanding, March 31, 2023 2,882,594 $ 3.34 Granted — $ — Forfeited or rescinded — $ — Vested — $ — Outstanding, June 30, 2023 2,882,594 $ 3.34 Granted — — Forfeited or rescinded — — Vested — — Outstanding, September 30, 2023 2,882,594 $ 3.34 |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 9 Months Ended |
Sep. 30, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | NOTE 12 — COMMITMENTS AND CONTINGENCIES Standby Letters of Credit – A commercial bank issued standby letters of credit on behalf of the Company totaling $260,000 to the State of Texas and federal agencies and $500,438 to an insurance company to secure the surety bonds described below. The standby letters of credit are valid until cancelled or matured and are collateralized by the revolving credit facility with the bank. The terms of the letters of credit to the state and federal agencies are extended for a term of one year at a time. The Company intends to renew the standby letters of credit to the state and federal agencies for as long as the Company does business in the State of Texas. The letters of credit to the insurance company will be renewed if the insurance requires them to retain the surety bonds; however, as the Company no longer operates any wells in the State of New Mexico, these standby letters of credit will not be renewed. No amounts have been drawn under the standby letters of credit. Surety Bonds – An insurance company issued surety bonds on behalf of the Company totaling $500,438 to various State of New Mexico agencies in order for the Company to do business in the State of New Mexico. The surety bonds are valid until canceled or matured. The terms of the surety bonds are extended for a term of one year at a time. The Company does not intend to renew the surety bonds in the State of New Mexico, as these operated assets have now been sold to a third party. As of September 30, 2023, the Company still had surety bonds in total of $650,288 for the State of New Mexico; however, these bonds are expected to be eliminated once change of ownership is approved by the New Mexico Oil Conservation Division. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 9 Months Ended |
Sep. 30, 2023 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | NOTE 13 — SUBSEQUENT EVENTS In accordance with ASC Topic 855, Subsequent Events, the Company has evaluated all events subsequent to the balance sheet date of September 30, 2023, through the date of this report. The Company did not have any material subsequent events to report. |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2023 | Jun. 30, 2023 | Mar. 31, 2023 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Pay vs Performance Disclosure | ||||||||
Net income (loss) | $ (7,539,222) | $ 28,791,605 | $ 32,715,779 | $ 75,085,891 | $ 41,944,422 | $ 7,112,043 | $ 53,968,162 | $ 124,142,356 |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended |
Sep. 30, 2023 | |
Trading Arrangements, by Individual | |
Rule 10b5-1 Arrangement Adopted | false |
Non-Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Non-Rule 10b5-1 Arrangement Terminated | false |
BASIS OF PRESENTATION AND SIG_2
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES (Policies) | 9 Months Ended |
Sep. 30, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Nature of Operations | Organization and Nature of Operations – Ring Energy is a growth oriented independent exploration and production company based in The Woodlands, Texas engaged in oil and natural gas development, production, acquisition, and exploration activities currently focused in Texas. Our primary drilling operations target the oil and liquids rich producing formations in the Northwest Shelf and the Central Basin Platform, both of which are part of the Permian Basin. |
Liquidity and Capital Considerations | Liquidity and Capital Considerations – The Company strives to maintain an adequate liquidity level to address volatility and risk. Sources of liquidity include the Company’s cash flow from operations, cash on hand, available borrowing capacity under its revolving credit facility, and proceeds from sales of non-strategic assets. While changes in oil and natural gas prices affect the Company’s liquidity, the Company has put in place hedges in seeking to protect a substantial portion of its cash flows from price declines; however, if oil or natural gas prices rapidly deteriorate due to unanticipated economic conditions, this could still have a material adverse effect on the Company’s cash flows. The Company expects ongoing oil price volatility over an indeterminate term. Extended depressed oil prices have historically had and could have a material adverse impact on the Company’s oil revenue, which is mitigated to some extent by the Company’s hedge contracts. The Company is always mindful of oil price volatility and its impact on our liquidity. The Company believes that it has the ability to continue to fund its operations and service its debt by using cash flows from operations. |
Use of Estimates | Use of Estimates – The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities and the reported amounts of revenues and expenses during the reporting period. The Company’s unaudited condensed financial statements are based on a number of significant estimates, including estimates of oil and natural gas reserve quantities, which are the basis for the calculation of depletion and impairment of oil and gas properties. Reserve estimates, by their nature, are inherently imprecise. Actual results could differ from those estimates. Changes in the future |
Fair Value Measurements | Fair Value Measurements - Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). The Financial Accounting Standards Board (“FASB”) has established a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. This hierarchy consists of three broad levels. Level 1 inputs are the highest priority and consist of unadjusted quoted prices in active markets for identical assets and liabilities. Level 2 are inputs other than quoted prices that are observable for the asset or liability, either directly or indirectly. Level 3 are unobservable inputs for an asset or liability. |
Fair Value of Financial Instruments | Fair Values of Financial Instruments – The carrying amounts reported for our revolving line of credit approximate their fair value because the underlying instruments are at interest rates which approximate current market rates. The carrying amounts of accounts receivables and accounts payable and other current assets and liabilities approximate fair value because of the short-term maturities and/or liquid nature of these assets and liabilities. |
Fair Value of Non-financial Assets and Liabilities | Fair Value of Non-financial Assets and Liabilities – The Company also applies fair value accounting guidance to initially, or as events dictate, measure non-financial assets and liabilities such as those obtained through business acquisitions, property and equipment and asset retirement obligations. These assets and liabilities are subject to fair value adjustments only in certain circumstances and are not subject to recurring revaluations. Fair value may be estimated using comparable market data, a discounted cash flow method, or a combination of the two as considered appropriate based on the circumstances. Under the discounted cash flow method, estimated future cash flows are based on management’s expectations for the future and include estimates of future oil and natural gas production or other applicable sales estimates, operational costs and a risk-adjusted discount rate. The Company may use the present value of estimated future cash inflows and/or outflows or third-party offers or prices of comparable assets with consideration of current market conditions to value its non-financial assets and liabilities when circumstances dictate determining fair value is necessary. Given the significance of the unobservable nature of a number of the inputs, these are considered Level 3 on the fair value hierarchy. |
Derivative Instruments and Hedging Activities | Derivative Instruments and Hedging Activities – The Company periodically enters into derivative contracts to manage its exposure to commodity price risk. These derivative contracts, which are generally placed with major financial institutions, may take the form of forward contracts, futures contracts, swaps or options. The oil and gas reference prices upon which the commodity derivative contracts are based reflect various market indices that have a high degree of historical correlation with actual prices received by the Company for its oil and gas production. As the Company has not designated its derivative instruments as hedges for accounting purposes, any gains or losses resulting from changes in fair value of outstanding derivative financial instruments and from the settlement of derivative financial instruments are recognized in earnings and included as a component of other income (expense) in the Condensed Statements of Operations. When applicable, the Company records all derivative instruments, other than those that meet the normal purchases and sales exception, on the balance sheet as either an asset or liability measured at fair value. Changes in fair value are recognized currently in earnings unless specific hedge accounting criteria are met. See "NOTE 6 — DERIVATIVE FINANCIAL INSTRUMENTS" below for additional information. |
Concentration of Credit Risk and Receivables | Concentration of Credit Risk and Receivables – Financial instruments that potentially subject the Company to a concentration of credit risk consist principally of cash and receivables. Cash and cash equivalents - The Company had cash in excess of federally insured limits of $0 and $3,462,526 as of September 30, 2023 and December 31, 2022, respectively. The Company places its cash with a high credit quality financial institution. The Company has not experienced any losses in such accounts and believes it is not exposed to significant credit risk in this area. Accounts receivable - Substantially all of the Company’s accounts receivable is from purchasers of oil and natural gas. Oil and natural gas sales are generally unsecured. The Company has not had any significant credit losses in the past and believes its accounts receivable are fully collectable. During the nine months ended September 30, 2023, sales to three purchasers represented 67%, 12% and 10%, respectively, of total oil, natural gas, and natural gas liquids sales. As of September 30, 2023, receivables outstanding from these three purchasers represented 69%, 9% and 7%, respectively, of accounts receivable. Production imbalances - The Company accounts for natural gas production imbalances using the sales method, which recognizes revenue on all natural gas sold even though the natural gas volumes sold may be more or less than the Company's ownership entitles it to sell. Liabilities are recorded for imbalances greater than the Company’s proportionate share of remaining estimated natural gas reserves. The Company recorded no imbalances as of September 30, 2023 or December 31, 2022. Joint interest billing receivables, net - The Company also has joint interest billing receivables. Joint interest billing receivables are collateralized by the pro rata revenue attributable to the joint interest holders and further by the interest itself. Accounts receivable from joint interest owners or purchasers outstanding longer than the contractual payment terms are considered past due. The following table indicates the Company's provisions for bad debt expense associated with its joint interest billing receivables during the three and nine months ended September 30, 2023 and September 30, 2022. For the Three Months Ended For the Nine Months Ended September 30, 2023 September 30, 2022 September 30, 2023 September 30, 2022 Bad debt expense $ 19,656 $ — $ 41,865 $ — |
Cash and Cash Equivalents | Cash and Cash Equivalents – The Company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents. At September 30, 2023 and December 31, 2022, the Company had no such investments. |
Inventory | Inventory - The full balance of the Company's inventory consists of materials and supplies for its operations, with no work in process or finished goods inventory balances. Inventory is added to the books upon the purchase of supplies (inclusive of freight and sales tax costs) to use on well sites, and inventory is reduced by material transfers for inventory usage based on the initial invoiced value. The Company reports the balance of its inventory at the lower of cost or net realizable value. Inventory balances are excluded from the Company's calculation of depletion. |
Oil and Natural Gas Properties | Oil and Natural Gas Properties – The Company uses the full cost method of accounting for oil and natural gas properties. Under this method, all costs (direct and indirect) associated with acquisition, exploration, and development of oil and natural gas properties are capitalized. Costs capitalized include acquisition costs, geological and geophysical expenditures, lease rentals on undeveloped properties and costs of drilling and equipping productive and non-productive wells. Drilling costs include directly related overhead costs. Capitalized costs are categorized either as being subject to amortization or not subject to amortization. All of the Company’s capitalized costs, excluding inventory, are subject to amortization. The Company records a liability in the period in which an asset retirement obligation (“ARO”) is incurred, in an amount equal to the discounted estimated fair value of the obligation that is capitalized. Thereafter this liability is accreted up to the final retirement cost. An ARO is a future expenditure related to the disposal or other retirement of certain assets. The Company’s ARO relates to future plugging and abandonment expenses of its oil and natural gas properties and related facilities disposal. Dispositions of oil and natural gas properties are accounted for as adjustments to capitalized costs. All capitalized costs of oil and natural gas properties, including the estimated future costs to develop proved reserves and estimated future costs to plug and abandon wells and costs of site restoration, less the estimated salvage value of equipment associated with the oil and natural gas properties, are amortized on the unit-of-production method using estimates of proved reserves as determined by independent petroleum engineers. If the results of an assessment indicate that the properties are impaired, the amount of the impairment is offset to the capitalized costs to be amortized. The following table shows total depletion and the depletion per barrel-of-oil-equivalent rate, for the three and nine months ended September 30, 2023 and 2022. For the Three Months Ended For the Nine Months Ended September 30, 2023 September 30, 2022 September 30, 2023 September 30, 2022 Depletion $ 21,711,123 $ 14,163,574 $ 63,203,473 $ 34,417,978 Depletion rate, per barrel-of-oil-equivalent (Boe) $ 13.48 $ 11.59 $ 13.09 $ 11.95 In addition, capitalized costs less accumulated depreciation, depletion and amortization and related deferred income taxes are not allowed to exceed an amount (the full cost ceiling) equal to the sum of: 1) the present value of estimated future net revenues discounted at ten percent computed in compliance with SEC guidelines; 2) plus the cost of properties not being amortized; 3) plus the lower of cost or estimated fair value of unproven properties included in the costs being amortized; 4) less income tax effects related to differences between the book and tax basis of the properties. |
Land, Buildings, Equipment, Software, Leasehold Improvements, and Automobiles | Land, Buildings, Equipment, Software, Leasehold Improvements, and Automobiles – Land, buildings, equipment, software, leasehold improvements, and automobiles are carried at historical cost, adjusted for impairment loss and accumulated depreciation (except for land). Historical costs include all direct costs associated with the acquisition of land, buildings, equipment, software, leasehold improvements, and automobiles and placing them in service. Upon sale or abandonment, the cost of the fixed asset(s) and related accumulated depreciation are removed from the accounts and any gain or loss is recognized. Depreciation of buildings, equipment, software, leasehold improvements, and automobiles is calculated using the straight-line method based upon the following estimated useful lives: Leasehold improvements 3‑5 years Office equipment and software 3‑7 years Equipment 5‑10 years Automobiles 4 years Buildings and structures 7 years |
Revenue Recognition | Revenue Recognition – In January 2018, the Company adopted Accounting Standards Update (“ASU”) 2014-09 Revenues from Contracts with Customers (Topic 606) (“ASU 2014-09”). The timing of recognizing revenue from the sale of produced crude oil and natural gas was not changed as a result of adopting ASU 2014-09. The Company predominantly derives its revenue from the sale of produced crude oil and natural gas. The contractual performance obligation is satisfied when the product is delivered to the purchaser. Revenue is recorded in the month the product is delivered to the purchaser. The Company receives payment from one to three months after delivery. The transaction price includes variable consideration as product pricing is based on published market prices and reduced for contract specified differentials (quality, transportation and other variables from benchmark prices). The guidance regarding ASU 2014-09 does not require that the transaction price be fixed or stated in the contract. Estimating the variable consideration does not require significant judgment and Ring engages third party sources to validate the estimates. Revenue is recognized net of royalties due to third parties in an amount that reflects the consideration the Company expects to receive in exchange for those products. See "NOTE 2 — REVENUE RECOGNITION" for additional information. |
Income Taxes | Income Taxes – Provisions for income taxes are based on taxes payable or refundable for the current year and deferred taxes. Deferred taxes are provided on differences between the tax basis of assets and liabilities and their reported amounts in the condensed financial statements, and tax carryforwards. Deferred tax assets and liabilities are included in the condensed financial statements at currently enacted income tax rates applicable to the period in which the deferred tax assets and liabilities are expected to be realized or settled. As changes in tax laws or rates are enacted, deferred tax assets and liabilities are adjusted through the provision for income taxes. Since December 31, 2020, the Company determined that a full valuation allowance was necessary due to the Company's assessment that it was more likely than not that it would be unable to obtain the benefits of its deferred tax assets due to the Company’s history of taxable losses. The Company determined that certain existing deferred tax assets would not be offset by existing deferred tax liabilities as a result of the 80% limitation on the utilization net operating losses incurred after 2017. Since 2021, commodity prices increased and the Company continues to project positive pre-tax book income. As of June 30, 2023, the Company was no longer in a cumulative loss position. As a result, future forecasted pre-tax book income was considered as positive evidence in assessing the valuation allowance. Based on the change in judgment on the realizability of the related federal deferred tax assets in future years, the Company released $10.5 million of valuation allowance as a discrete benefit in the first nine months ended September 30, 2023. Accordingly, the Company recorded the following federal and state income tax benefits (provisions) for the three and nine months ended September 30, 2023 and 2022. For the Three Months Ended For the Nine Months Ended September 30, 2023 September 30, 2022 September 30, 2023 September 30, 2022 Deferred federal income tax benefit (provision) $ 3,381,104 $ (3,611,381) $ 8,492,595 $ (4,625,429) Current state income tax benefit (provision) (165,780) (36,736) (264,261) (36,736) Deferred state income tax benefit (provision) 196,012 (667,666) (490,646) (1,204,579) Benefit from (Provision for) Income Taxes $ 3,411,336 $ (4,315,783) $ 7,737,688 $ (5,866,744) The Company had immaterial operations in New Mexico which is in a net deferred tax asset position for which a full valuation allowance is still recorded. |
Accounting for Uncertainty in Income Taxes | Accounting for Uncertainty in Income Taxes – In accordance with GAAP, the Company has analyzed its filing positions in all jurisdictions where it is required to file income tax returns for the open tax years. The Company has identified its federal income tax return and its franchise tax return in Texas in which it operates as “major” tax jurisdictions. The Company’s federal income tax returns for the years ended December 31, 2018 and after remain subject to examination. The Company’s federal income tax returns for the years ended December 31, 2007 and after remain subject to examination to the extent of the net operating loss (NOL) carryforwards. The Company’s franchise tax returns in Texas remain subject to examination for 2017 and after. The Company currently believes that all significant filing positions are highly certain and that all of its significant income tax filing positions and deductions would be sustained upon audit. Therefore, the Company |
Three-Stream Reporting | Three-Stream Reporting - Beginning July 1, 2022, the Company began reporting volumes and revenues on a three-stream basis, separately reporting crude oil, natural gas, and natural gas liquids ("NGLs") sales. For periods prior to July 1, 2022, sales and reserve volumes, prices, and revenues for NGLs were presented with natural gas. This represents a change in our accounting and reporting presentation necessitated by a change in the underlying facts and circumstances surrounding the Stronghold Acquisition, as Stronghold had historically reported its revenues on a three-stream basis. As clarified in the interpretive guidance of ASC 250, such changes should not be applied on a retrospective basis. Accordingly, we began reporting on a three-stream basis prospectively, beginning July 1, 2022. See NOTE 5 - ACQUISITIONS AND DIVESTITURES for a discussion of the Stronghold Acquisition. |
Leases | Leases - The Company accounts for its leases in accordance with ASU 2016-02, Leases (Topic 842), effective January 1, 2019. The Company made accounting policy elections to not capitalize leases with a lease term of twelve months or less (i.e. short term leases) and to not separate lease and non-lease components for all asset classes. The Company also elected to adopt the package of practical expedients within ASU 2016-02 that allows an entity to not reassess prior to the effective date (i) whether any expired or existing contracts are or contain leases, (ii) the lease classification for any expired or existing leases, or (iii) initial direct costs for any existing leases, and the practical expedient regarding land easements that exist prior to the adoption of ASU 2016-02. The Company did not elect the practical expedient of hindsight when determining the lease term of existing contracts at the effective date. |
Earnings (Loss) Per Share | Earnings (Loss) Per Share – Basic earnings (loss) per share is computed by dividing net income (loss) by the weighted-average number of common shares outstanding during the applicable period. Diluted earnings (loss) per share are calculated to give effect to potentially issuable dilutive common shares. |
Share-Based Employee Compensation | Share-Based Employee Compensation – The Company has outstanding stock option grants and restricted stock unit awards to directors, officers and employees, which are described more fully below in "NOTE 11 — EMPLOYEE STOCK OPTIONS AND RESTRICTED STOCK UNITS". The Company recognizes the cost of employee services received in exchange for an award of equity instruments based on the grant-date fair value of the award and recognizes the related compensation expense over the period during which an employee is required to provide service in exchange for the award, which is generally the vesting period. |
Share-Based Compensation to Non-Employees | Share-Based Compensation to Non-Employees – The Company accounts for share-based compensation issued to non-employees as either the fair value of the consideration received or the fair value of the equity instruments issued, whichever is more reliably measurable. The measurement date for these issuances is the earlier of (i) the date at which a commitment for performance by the recipient to earn the equity instruments is reached or (ii) the date at which the recipient’s performance is complete. |
Recently Adopted Accounting Pronouncements/Recent Accounting Pronouncements | Recently Adopted Accounting Pronouncements – In July 2023, the FASB issued ASU 2023-03, Presentation of Financial Statements (Topic 205), Income Statement - Reporting Comprehensive Income (Topic 220), Distinguishing Liabilities from Equity (Topic 480), Equity (Topic 505), and Compensation - Stock Compensation (Topic 718): Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 120, SEC Staff Announcement at the March 24, 2022 EITF Meeting, and Staff Accounting Bulletin Topic 6.B, Accounting Series Release 280 - General Revision of Regulation S-X: Income or Loss Applicable to Common Stock. The ASU provided updated views from the SEC Staff on employee and non-employee share-based payment accounting, including guidance related to spring-loaded awards. As the ASU did not provide any new ASC guidance, and there was no transition or effective date provided, the Company adopted this standard upon issuance, and the adoption did not have a material impact on our condensed financial statements. Recent Accounting Pronouncements – In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting (“ASU 2020-04”), which provided optional expedients and exceptions for applying GAAP to contract modifications and hedging relationships, subject to meeting certain criteria, that referenced LIBOR or another rate. ASU 2020-04 was in effect through December 31, 2022. In January 2021, the FASB issued ASU No. 2021-01, Reference Rate Reform (Topic 848): Scope (“ASU 2021-01”), to provide clarifying guidance regarding the scope of Topic 848. ASU 2020-04 was issued to provide optional guidance for a limited period of time to ease the potential burden in accounting for (or recognizing the effects of) reference rate reform on financial reporting. In December 2022, the FASB issued ASU 2022-06, " Reference Rate Reform (Topic 848): Deferral of the Sunset Date of Topic 848" ("ASU 2022-06"), wh ich defers the sunset date of Topic 848 from December 31, 2022 to December 31, 2024. Beginning August 31, 2022, under the Company's Second Amended and Restated Credit Agreement, the Company's interest rates were transitioned from the LIBOR to the SOFR (Standard Overnight Financing Rate) reference rate. At this time, the Company does not plan to enter into additional contracts using LIBOR as a reference rate. In October 2021, the FASB issued ASU 2021-08, " Business Combinations (Topic 805) – Accounting for Contract Assets and Contract Liabilities from Contracts with Customers” ("ASU 2021-08"). This update requires the acquirer in a business combination to record contract asset and liabilities following Topic 606 – “Revenue from Contracts with Customers” at acquisition as if it had originated the contract, rather than at fair value. This update is effective for public business entities beginning after December 15, 2022, with early adoption permitted. The Company continues to evaluate the provisions of this update, but it does not believe the adoption will have a material impact on its financial position, results of operations or liquidity. On July 26, 2023, the SEC issued Final Rule Release No. 33-11216, Cybersecurity Risk Management, Strategy, Governance, and Incident Disclosure , which requires current disclosures (via Form 8-K, Item 1.05) about material cybersecurity incidents and requires periodic disclosures (via Form 10-K, Item 1C, "Cybersecurity") about a registrant’s processes to manage its material cybersecurity risks. The Company is currently considering the impact of this rule on its disclosures. |
BASIS OF PRESENTATION AND SIG_3
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Accounts Receivable, Allowance for Credit Loss | The following table indicates the Company's provisions for bad debt expense associated with its joint interest billing receivables during the three and nine months ended September 30, 2023 and September 30, 2022. For the Three Months Ended For the Nine Months Ended September 30, 2023 September 30, 2022 September 30, 2023 September 30, 2022 Bad debt expense $ 19,656 $ — $ 41,865 $ — |
Schedule of Joint Interest Billing Receivable and Allowance for Credit Losses | The following table reflects the Company's joint interest billing receivables and allowance for credit losses as of September 30, 2023 and December 31, 2022. September 30, 2023 December 31, 2022 Joint interest billing receivables $ 3,484,616 $ 1,226,049 Allowance for credit losses (178,491) (242,247) Joint interest billing receivables, net $ 3,306,125 $ 983,802 |
Schedule of Depletion and Depletion Rate per Barrel of Oil Equivalents | The following table shows total depletion and the depletion per barrel-of-oil-equivalent rate, for the three and nine months ended September 30, 2023 and 2022. For the Three Months Ended For the Nine Months Ended September 30, 2023 September 30, 2022 September 30, 2023 September 30, 2022 Depletion $ 21,711,123 $ 14,163,574 $ 63,203,473 $ 34,417,978 Depletion rate, per barrel-of-oil-equivalent (Boe) $ 13.48 $ 11.59 $ 13.09 $ 11.95 |
Schedule of Property Plant and Equipment Estimated Useful Lives | Depreciation of buildings, equipment, software, leasehold improvements, and automobiles is calculated using the straight-line method based upon the following estimated useful lives: Leasehold improvements 3‑5 years Office equipment and software 3‑7 years Equipment 5‑10 years Automobiles 4 years Buildings and structures 7 years |
Schedule of Useful Lives | The following table provides information on the Company's depreciation expense for the three and nine months ended September 30, 2023 and 2022. For the Three Months Ended For the Nine Months Ended September 30, 2023 September 30, 2022 September 30, 2023 September 30, 2022 Depreciation $ 80,690 $ 53,946 $ 277,420 $ 102,568 |
Schedule of Interest Paid Related to Notes Payable | The following table shows interest paid related to notes payable for the three and nine months ended September 30, 2023 and 2022. This interest is included within "Interest (expense)" in the Condensed Statements of Operations. Three Months Ended Nine Months Ended September 30, 2023 September 30, 2022 September 30, 2023 September 30, 2022 Interest paid for notes payable $ 22,286 $ 7,917 $ 35,211 $ 17,201 |
Schedule of Components of Income Tax Expense | Accordingly, the Company recorded the following federal and state income tax benefits (provisions) for the three and nine months ended September 30, 2023 and 2022. For the Three Months Ended For the Nine Months Ended September 30, 2023 September 30, 2022 September 30, 2023 September 30, 2022 Deferred federal income tax benefit (provision) $ 3,381,104 $ (3,611,381) $ 8,492,595 $ (4,625,429) Current state income tax benefit (provision) (165,780) (36,736) (264,261) (36,736) Deferred state income tax benefit (provision) 196,012 (667,666) (490,646) (1,204,579) Benefit from (Provision for) Income Taxes $ 3,411,336 $ (4,315,783) $ 7,737,688 $ (5,866,744) |
Schedule of Noncash Share-Based Payment Arrangements | The following table summarizes the Company's share-based compensation, included with General and administrative expense within our Condensed Statements of Operations, incurred for the three and nine months ended September 30, 2023 and 2022. Three Months Ended Nine Months Ended September 30, 2023 September 30, 2022 September 30, 2023 September 30, 2022 Share-based compensation $ 2,170,735 $ 1,543,033 $ 6,374,743 $ 4,964,188 Compensation expense charged against income for share-based awards during the three and nine months ended September 30, 2023 and 2022 was as follows. These amounts are included in General and administrative expense in the Condensed Statements of Operations. Three Months Ended Nine Months Ended September 30, 2023 September 30, 2022 Sep. 30, 2023 Sep. 30, 2022 Share-based compensation $ 2,170,735 $ 1,543,033 $ 6,374,743 $ 4,964,188 |
REVENUE RECOGNITION (Tables)
REVENUE RECOGNITION (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Disaggregation of Revenue | Disaggregation of Revenue. The following table presents revenues disaggregated by product: For the Three Months Ended For the Nine Months Ended September 30, 2023 September 30, 2022 September 30, 2023 September 30, 2022 Oil, Natural Gas, and Natural Gas Liquids Revenues Oil $ 90,392,004 $ 86,413,665 $ 252,020,403 $ 229,532,827 Natural gas 562,374 4,655,002 526,161 14,678,747 Natural gas liquids (1) 2,727,420 3,340,281 8,566,719 3,340,281 Total oil, natural gas, and natural gas liquids revenues $ 93,681,798 $ 94,408,948 $ 261,113,283 $ 247,551,855 (1) Beginning on July 1, 2022, the Company began reporting volumes and revenues on a three-stream basis, separately reporting crude oil, natural gas, and NGL sales. For periods prior to July 1, 2022, sales revenues for NGLs were presented with natural gas. |
LEASES (Tables)
LEASES (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Leases [Abstract] | |
Schedule of Future Lease Payments of Operating Lease and Finance Lease | Future lease payments associated with these operating and financing leases as of September 30, 2023 are as follows: 2023 2024 2025 2026 2027 Other Future Years Operating lease payments (1) $ 118,616 $ 675,210 $ 727,460 $ 636,649 $ 460,497 400,234 Financing lease payments (2) 223,492 832,238 493,290 49,763 — — (1) The weighted average annual discount rate as of September 30, 2023 for operating leases was 4.50%. Based on this rate, the future lease payments above include imputed interest of $307,998. The weighted average remaining term of operating leases was 4.51 years. |
Schedule Of Reconciliation Between The Undiscounted Future Cash Flows And The Operating And Financing Lease Liabilities | The following table represents a reconciliation between the undiscounted future cash flows in the table above and the operating and financing lease liabilities disclosed in the Condensed Balance Sheets: As of September 30, 2023 December 31, 2022 Operating lease liability, current portion $ 503,420 $ 398,362 Operating lease liability, non-current portion 2,207,248 1,473,897 Operating lease liability, total $ 2,710,668 $ 1,872,259 Total undiscounted future cash flows (sum of future operating lease payments) 3,018,666 2,065,580 Imputed interest 307,998 193,321 Undiscounted future cash flows less imputed interest $ 2,710,668 $ 1,872,259 Financing lease liability, current portion $ 806,993 $ 709,653 Financing lease liability, non-current portion 690,456 1,052,479 Financing lease liability, total $ 1,497,449 $ 1,762,132 Total undiscounted future cash flows (sum of future financing lease payments) 1,598,783 1,900,595 Imputed interest 101,334 138,463 Undiscounted future cash flows less imputed interest $ 1,497,449 $ 1,762,132 |
Schedule of Lease Cost | The following table provides supplemental information regarding lease costs in the Condensed Statements of Operations: For the Three Months Ended For the Nine Months Ended September 30, 2023 September 30, 2022 September 30, 2023 September 30, 2022 Operating lease costs $ 138,220 $ 83,590 $ 366,711 $ 250,770 Short-term lease costs (1) 1,012,525 639,708 4,042,160 1,937,310 Financing lease costs: Amortization of financing lease assets (2) 197,221 106,982 572,744 334,447 Interest on financing lease liabilities (3) 23,416 10,391 73,115 24,184 (1) Amount included in Lease operating expenses (2) Amount included in Depreciation, depletion and amortization (3) Amount included in Interest (expense) |
EARNINGS (LOSS) PER SHARE INF_2
EARNINGS (LOSS) PER SHARE INFORMATION (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings per Share, Basic and Diluted | The following table presents the calculation of the Company's basic and diluted earnings (loss) per share for the three and nine months ended September 30, 2023 and 2022. For the Three Months Ended For the Nine Months Ended September 30, 2023 September 30, 2022 September 30, 2023 September 30, 2022 Net Income (Loss) $ (7,539,222) $ 75,085,891 $ 53,968,162 $ 124,142,356 Basic Weighted-Average Shares Outstanding 195,361,476 115,376,280 188,865,752 107,349,184 Effect of dilutive securities: Stock options — 52,110 — 93,688 Restricted stock units — 1,908,662 1,310,409 2,135,675 Performance stock units — 196,520 361,406 235,440 Common warrants — 19,884,296 4,045,648 20,180,729 Convertible preferred stock — 14,337,127 — 4,831,559 Diluted Weighted-Average Shares Outstanding 195,361,476 151,754,995 194,583,215 134,826,275 Basic Earnings (Loss) per Share $ (0.04) $ 0.65 $ 0.29 $ 1.16 Diluted Earnings (Loss) per Share $ (0.04) $ 0.49 $ 0.28 $ 0.92 |
Schedule of Securities Excluded from Computation of Earnings Per Share | The following table presents the securities which were excluded from the Company's computation of diluted earnings per share for the three and nine months ended September 30, 2023 and 2022, as their effect would have been anti-dilutive. For the Three Months Ended For the Nine Months Ended September 30, 2023 September 30, 2022 September 30, 2023 September 30, 2022 Antidilutive securities: Stock options to purchase common stock 265,500 70,500 265,500 70,500 Unvested restricted stock units 3,866,023 37,487 61,212 11,312 Unvested performance stock units 2,882,594 860,212 1,396,446 798,768 |
ACQUISITIONS AND DIVESTITURES (
ACQUISITIONS AND DIVESTITURES (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Business Combination and Asset Acquisition [Abstract] | |
Asset Acquisition | The following table represents the preliminary allocation of the total cost of the Founders Acquisition to the assets acquired and liabilities assumed as of the Founders Acquisition date: Consideration: Cash consideration Escrow deposit released at closing $ 7,500,000 Closing amount paid to Founders 42,502,799 Interest from escrow deposit 1,747 Fair value of deferred payment liability 14,657,383 Post-close adjustments (1,463,632) Total cash consideration $ 63,198,297 Direct transaction costs $ 1,361,843 Total consideration $ 64,560,140 Fair value of assets acquired: Oil and natural gas properties $ 67,562,084 Amount attributable to assets acquired $ 67,562,084 Fair value of liabilities assumed: Suspense liability $ 677,116 Asset retirement obligations 2,090,777 Ad valorem tax liability 234,051 Amount attributable to liabilities assumed $ 3,001,944 Net assets acquired $ 64,560,140 |
DERIVATIVE FINANCIAL INSTRUME_2
DERIVATIVE FINANCIAL INSTRUMENTS (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Contracts on the Balance Sheet | The following presents the impact of the Company’s contracts on its Condensed Balance Sheets for the periods indicated. As of September 30, 2023 December 31, 2022 Commodity derivative instruments, marked to market: Derivative assets, current $ 5,772,513 $ 16,193,327 Discounted deferred premiums (3,927,380) (11,524,165) Derivatives assets, current, net of premiums $ 1,845,133 $ 4,669,162 Derivative assets, noncurrent $ 6,465,355 $ 7,606,258 Discounted deferred premiums — (1,476,848) Derivative assets, noncurrent, net of premiums $ 6,465,355 $ 6,129,410 Derivative liabilities, current $ 23,906,800 $ 13,345,619 Derivative liabilities, noncurrent $ 18,089,847 $ 10,485,650 |
Schedule of Components of Gain (Loss) on Derivative Contracts | The components of “Gain (loss) on derivative contracts” from the Condensed Statements of Operations are as follows for the respective periods: For the Three Months Ended For the Nine Months Ended September 30, 2023 September 30, 2022 September 30, 2023 September 30, 2022 Oil derivatives: Realized gain (loss) on oil derivatives $ (5,825,427) $ (13,958,195) $ (7,323,030) $ (47,690,961) Unrealized gain (loss) on oil derivatives (34,077,473) 49,680,492 (21,425,316) 48,360,099 Gain (loss) on oil derivatives $ (39,902,900) $ 35,722,297 $ (28,748,346) $ 669,138 Natural gas derivatives: Realized gain (loss) on natural gas derivatives 474,629 (902,921) 1,493,302 (902,921) Unrealized gain (loss) on natural gas derivatives 205,516 (1,968,187) 771,854 (1,968,187) Gain (loss) on natural gas derivatives $ 680,145 $ (2,871,108) $ 2,265,156 $ (2,871,108) Gain (loss) on derivative contracts $ (39,222,755) $ 32,851,189 $ (26,483,190) $ (2,201,970) |
Schedule of Components of Cash (Paid) Received for Commodity Derivative Settlements | The components of “Cash paid for derivative settlements, net” within the Condensed Statements of Cash Flows are as follows for the respective periods: For the Three Months Ended For the Nine Months Ended September 30, 2023 September 30, 2022 September 30, 2023 September 30, 2022 Cash flows from operating activities Cash received (paid) for oil derivatives $ (5,825,427) $ (13,958,195) $ (7,323,030) $ (47,690,961) Cash received (paid) from natural gas derivatives 474,629 (902,921) 1,493,302 (902,921) Cash received (paid) for derivative settlements, net $ (5,350,798) $ (14,861,116) $ (5,829,728) $ (48,593,882) |
Derivatives Not Designated as Hedging Instruments | The following tables reflect the details of current derivative contracts as of September 30, 2023 (Quantities are in barrels (Bbl) for the oil derivative contracts and in million British thermal units (MMBtu) for the natural gas derivative contracts): Oil Hedges (WTI) Q4 2023 Q1 2024 Q2 2024 Q3 2024 Q4 2024 Q1 2025 Q2 2025 Q3 2025 Q4 2025 Swaps: Hedged volume (Bbl) 138,000 170,625 156,975 282,900 368,000 — — 184,000 — Weighted average swap price $ 74.52 $ 67.40 $ 66.40 $ 65.49 $ 68.43 $ — $ — $ 73.35 $ — Deferred premium puts: Hedged volume (Bbl) 165,600 45,500 45,500 — — — — — — Weighted average strike price $ 83.78 $ 84.70 $ 82.80 $ — $ — $ — $ — $ — $ — Weighted average deferred premium price $ 14.61 $ 17.15 $ 17.49 $ — $ — $ — $ — $ — $ — Two-way collars: Hedged volume (Bbl) 274,285 339,603 325,847 230,000 128,800 474,750 464,100 184,000 — Weighted average put price $ 56.73 $ 64.20 $ 64.30 $ 64.00 $ 60.00 $ 57.06 $ 60.00 $ 65.00 $ — Weighted average call price $ 70.77 $ 79.73 $ 79.09 $ 76.50 $ 73.24 $ 75.82 $ 69.85 $ 80.08 $ — Three-way collars: Hedged volume (Bbl) 15,598 — — — — — — — — Weighted average first put price $ 45.00 $ — $ — $ — $ — $ — $ — $ — $ — Weighted average second put price $ 55.00 $ — $ — $ — $ — $ — $ — $ — $ — Weighted average call price $ 80.05 $ — $ — $ — $ — $ — $ — $ — $ — Gas Hedges (Henry Hub) Q4 2023 Q1 2024 Q2 2024 Q3 2024 Q4 2024 Q1 2025 Q2 2025 Q3 2025 Q4 2025 NYMEX Swaps: Hedged volume (MMBtu) 134,102 152,113 138,053 121,587 644,946 616,199 591,725 285,200 — Weighted average swap price $ 3.35 $ 3.62 $ 3.61 $ 3.59 $ 4.45 $ 3.78 $ 3.43 $ 3.73 $ — Two-way collars: Hedged volume (MMBtu) 383,587 591,500 568,750 552,000 — — — 285,200 — Weighted average put price $ 3.15 $ 4.00 $ 4.00 $ 4.00 $ — $ — $ — $ 3.00 $ — Call hedged volume (MMBtu) 383,587 591,500 568,750 552,000 — — — 285,200 — Weighted average call price $ 4.51 $ 6.29 $ 6.29 $ 6.29 $ — $ — $ — $ 4.80 $ — Oil Hedges (basis differential) Q4 2023 Q1 2024 Q2 2024 Q3 2024 Q4 2024 Q1 2025 Q2 2025 Q3 2025 Q4 2025 Argus basis swaps: Hedged volume (MMBtu) 305,000 364,000 364,000 368,000 368,000 270,000 273,000 276,000 276,000 Weighted average spread price (1) $ 1.10 $ 1.15 $ 1.15 $ 1.15 $ 1.15 $ 1.00 $ 1.00 $ 1.00 $ 1.00 Gas Hedges (basis differential) Q4 2023 Q1 2024 Q2 2024 Q3 2024 Q4 2024 Q1 2025 Q2 2025 Q3 2025 Q4 2025 Waha basis swaps: Hedged volume (MMBtu) 324,021 — — — — — — — — Weighted average spread price (1) $ 0.55 $ — $ — $ — $ — $ — $ — $ — $ — El Paso Permian Basin basis swaps: Hedged volume (MMBtu) 459,683 — — — — — — — — Weighted average spread price (1) $ 0.63 $ — $ — $ — $ — $ — $ — $ — $ — |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis | The following table summarizes the valuation of our assets and liabilities that are measured at fair value on a recurring basis (further detail in "NOTE 6 — DERIVATIVE FINANCIAL INSTRUMENTS"). Fair Value Measurement Classification Quoted prices in Significant Other Significant Total As of December 31, 2022 Commodity Derivatives - Assets $ — $ 10,798,572 $ — $ 10,798,572 Commodity Derivatives - Liabilities $ — $ (23,831,269) $ — $ (23,831,269) Total $ — $ (13,032,697) $ — $ (13,032,697) As of September 30, 2023 Commodity Derivatives - Assets $ — $ 8,310,488 $ — $ 8,310,488 Commodity Derivatives - Liabilities $ — $ (41,996,647) $ — $ (41,996,647) Total $ — $ (33,686,159) $ — $ (33,686,159) |
ASSET RETIREMENT OBLIGATION (Ta
ASSET RETIREMENT OBLIGATION (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Asset Retirement Obligation Disclosure [Abstract] | |
Schedule of changes in asset retirement obligations | Changes in the asset retirement obligation during the nine months ended September 30, 2023 were as follows: Balance, December 31, 2022 $ 30,226,306 Liabilities acquired 2,090,777 Liabilities incurred 261,786 Liabilities sold (4,717,507) Liabilities settled (226,424) Revision of estimate 53,824 Accretion expense 1,073,901 Balance, September 30, 2023 $ 28,762,663 |
Schedule of current and non-current asset retirement obligations | The following table presents the Company's current and non-current asset retirement obligation balances as of the periods specified. September 30, 2023 December 31, 2022 Asset retirement obligations, current 279,681 635,843 Asset retirement obligations, non-current 28,482,982 29,590,463 Asset retirement obligations $ 28,762,663 $ 30,226,306 |
STOCKHOLDERS' EQUITY (Tables)
STOCKHOLDERS' EQUITY (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Stockholders' Equity Note [Abstract] | |
Schedule of Common Warrants Exercised | The following table reflects the common warrants exercised, including the proceeds received for such exercises. As of September 30, 2023 there remained 78,200 exercisable common warrants. Common Warrants Exercise Price Proceeds Received Exercisable, December 31, 2021 29,361,700 $ 0.80 Exercised — — $ — Exercisable, March 31, 2022 29,361,700 $ 0.80 Exercised (6,453,907) 0.80 $ 5,163,126 Exercisable, June 30, 2022 22,907,793 $ 0.80 Exercised (3,000,000) 0.80 $ 2,400,000 Exercisable, September 20, 2022 19,907,793 $ 0.80 Exercisable, December 31, 2022 19,107,793 $ 0.80 Exercised (4,517,427) 0.80 $ 3,613,941 Exercisable, March 31, 2023 14,590,366 $ 0.80 Exercised (1) (14,512,166) 0.62 $ 8,997,543 Exercisable, June 30, 2023 78,200 $ 0.80 Exercised — — $ — Exercisable, September 30, 2023 78,200 $ 0.80 (1) On April 11 and 12, 2023, the Company and certain holders of the common warrants (the “Participating Holders”) entered into a form of Warrant Amendment and Exercise Agreement (the “Exercise Agreement”) pursuant to which the Company agreed to reduce the exercise price of an aggregate of 14,512,166 common warrants held by such Participating Holders from $0.80 to $0.62 per share (the “Reduced Exercise Price”) in consideration for the immediate exercise of the common warrants held by such Participating Holders in full at the Reduced Exercise Price in cash. The Company received aggregate gross proceeds of $8,997,543 from the exercise of the common warrants by the Participating Holders pursuant to the Exercise Agreement, which was recognized as an equity issuance cost in accordance with ASC 815-40-35-17(a). In the Statements of Stockholders' Equity, the net impact to Stockholders' Equity is $8,687,655, which is net of $309,888 in advisory fees. |
EMPLOYEE STOCK OPTIONS AND RE_2
EMPLOYEE STOCK OPTIONS AND RESTRICTED STOCK UNITS (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
EMPLOYEE STOCK OPTIONS, RESTRICTED STOCK AWARD PLAN AND 401(k) | |
Schedule of Noncash Share-Based Payment Arrangements | The following table summarizes the Company's share-based compensation, included with General and administrative expense within our Condensed Statements of Operations, incurred for the three and nine months ended September 30, 2023 and 2022. Three Months Ended Nine Months Ended September 30, 2023 September 30, 2022 September 30, 2023 September 30, 2022 Share-based compensation $ 2,170,735 $ 1,543,033 $ 6,374,743 $ 4,964,188 Compensation expense charged against income for share-based awards during the three and nine months ended September 30, 2023 and 2022 was as follows. These amounts are included in General and administrative expense in the Condensed Statements of Operations. Three Months Ended Nine Months Ended September 30, 2023 September 30, 2022 Sep. 30, 2023 Sep. 30, 2022 Share-based compensation $ 2,170,735 $ 1,543,033 $ 6,374,743 $ 4,964,188 |
Schedule of Stock Options Activity | A summary of the status of the stock options as of September 30, 2023 and 2022 and changes during the respective nine month periods then ended are as follows: Options Weighted- Weighted-Average Remaining Contractual Term Aggregate Intrinsic Value Outstanding, December 31, 2021 365,500 $ 3.61 Granted — — Forfeited or rescinded — — Exercised — — Outstanding, March 31, 2022 365,500 $ 3.61 2.21 years $ 536,900 Granted — — Forfeited or rescinded — — Exercised (100,000) 2.00 Outstanding, June 30, 2022 265,500 $ 4.21 2.14 years $ 128,700 Granted — — Forfeited or rescinded — — Exercised — — Outstanding, September 30, 2022 265,500 $ 4.21 1.89 years $ 62,400 Exercisable, September 30, 2022 265,500 $ 4.21 1.89 years Outstanding, December 31, 2022 265,500 $ 4.21 Granted — — Forfeited or rescinded — — Exercised — — Outstanding, March 31, 2023 265,500 $ 4.21 1.39 years $ — Granted — — Forfeited or rescinded — — Exercised — — Outstanding, June 30, 2023 265,500 $ 4.21 1.14 years $ — Granted — $ — Forfeited or rescinded — $ — Exercised — $ — Outstanding, September 30, 2023 265,500 $ 4.21 0.89 years $ — Exercisable, September 30, 2023 265,500 $ 4.21 0.89 years |
Schedule of Restricted Stock Grants | A summary of the restricted stock unit activity as of September 30, 2023 and 2022, respectively, and changes during the respective nine month periods then ended are as follows: Restricted Stock Units Weighted- Outstanding, December 31, 2021 2,572,596 $ 1.75 Granted 1,247,061 2.79 Forfeited or rescinded — — Vested — — Outstanding, March 31, 2022 3,819,657 $ 2.09 Granted 19,642 $ 4.27 Forfeited or rescinded (17,204) $ 2.79 Vested (610,195) $ 2.80 Outstanding, June 30, 2022 3,211,900 $ 1.97 Granted 126,570 2.95 Forfeited or rescinded — — Vested (9,851) 2.69 Outstanding, September 30, 2022 3,328,619 $ 2.00 Outstanding, December 31, 2022 2,623,790 $ 2.29 Granted 2,270,842 2.22 Forfeited or rescinded (11,712) 2.22 Vested (659,479) 2.80 Outstanding, March 31, 2023 4,223,441 $ 2.17 Granted — $ — Forfeited or rescinded (49,465) $ 2.22 Vested (288,709) $ 2.85 Outstanding, June 30, 2023 3,885,267 $ 2.12 Granted — — Forfeited or rescinded (4,997) 2.22 Vested (39,443) 2.87 Outstanding, September 30, 2023 3,840,827 $ 2.12 |
Performance Stock Units Activity | A summary of the status of the performance stock unit ("PSU") grants as of September 30, 2023 and 2022, respectively, along with changes during the respective nine month periods then ended are as follows: Performance Stock Units Weighted- Outstanding, December 31, 2021 860,216 $ 3.87 Granted 860,216 3.65 Forfeited or rescinded — — Vested — — Outstanding, March 31, 2022 1,720,432 $ 3.76 Granted — $ — Forfeited or rescinded — $ — Vested — $ — Outstanding, June 30, 2022 1,720,432 $ 3.76 Granted — — Forfeited or rescinded — — Vested — — Outstanding, September 30, 2022 1,720,432 $ 3.76 Outstanding, December 31, 2022 1,720,432 $ 3.76 Granted 1,162,162 2.71 Forfeited or rescinded — — Vested — — Outstanding, March 31, 2023 2,882,594 $ 3.34 Granted — $ — Forfeited or rescinded — $ — Vested — $ — Outstanding, June 30, 2023 2,882,594 $ 3.34 Granted — — Forfeited or rescinded — — Vested — — Outstanding, September 30, 2023 2,882,594 $ 3.34 |
BASIS OF PRESENTATION AND SIG_4
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES - Narrative (Details) - USD ($) | 3 Months Ended | 6 Months Ended | 9 Months Ended | ||||
May 11, 2023 | Sep. 30, 2023 | Sep. 30, 2022 | Jun. 30, 2023 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | |
Organization And Summary Of Significant Accounting Policies [Line Items] | |||||||
Fair value, concentration of risk, cash and cash equivalents | $ 0 | $ 0 | $ 3,462,526 | ||||
Notes payable current, for obtaining external insurance | 950,068 | 950,068 | |||||
Decrease in allowance for credit losses | 63,756 | ||||||
Share-based compensation | $ 2,170,735 | $ 1,543,033 | $ 6,374,743 | $ 4,964,188 | |||
Effective tax rate | (31.20%) | 16.70% | |||||
Discrete item | $ 10,500,000 | $ 10,500,000 | |||||
Delaware Basin | |||||||
Organization And Summary Of Significant Accounting Policies [Line Items] | |||||||
Decrease in allowance for credit losses | $ 105,620 | ||||||
Promissory Notes Payable | |||||||
Organization And Summary Of Significant Accounting Policies [Line Items] | |||||||
Face value | $ 1,565,071 | $ 1,565,071 | |||||
Interest rate | 7.08% | 7.08% | |||||
Revenue from Contract with Customer Benchmark | Customer Concentration Risk | Customer One | |||||||
Organization And Summary Of Significant Accounting Policies [Line Items] | |||||||
Concentration risk, percentage | 67% | ||||||
Revenue from Contract with Customer Benchmark | Customer Concentration Risk | Customer Two | |||||||
Organization And Summary Of Significant Accounting Policies [Line Items] | |||||||
Concentration risk, percentage | 12% | ||||||
Revenue from Contract with Customer Benchmark | Customer Concentration Risk | Customer Three | |||||||
Organization And Summary Of Significant Accounting Policies [Line Items] | |||||||
Concentration risk, percentage | 10% | ||||||
Accounts Receivable | Customer Concentration Risk | Customer One | |||||||
Organization And Summary Of Significant Accounting Policies [Line Items] | |||||||
Concentration risk, percentage | 69% | ||||||
Accounts Receivable | Customer Concentration Risk | Customer Two | |||||||
Organization And Summary Of Significant Accounting Policies [Line Items] | |||||||
Concentration risk, percentage | 9% | ||||||
Accounts Receivable | Customer Concentration Risk | Customer Three | |||||||
Organization And Summary Of Significant Accounting Policies [Line Items] | |||||||
Concentration risk, percentage | 7% |
BASIS OF PRESENTATION AND SIG_5
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES - Provisions for Bad Debt Expense (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||
Bad debt expense | $ 19,656 | $ 0 | $ 41,865 | $ 0 |
BASIS OF PRESENTATION AND SIG_6
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES - Joint Interest Billing Receivable and Allowance for Credit Loss (Details) - USD ($) | Sep. 30, 2023 | Dec. 31, 2022 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Joint interest billing receivables | $ 3,484,616 | $ 1,226,049 |
Allowance for credit losses | (178,491) | (242,247) |
Joint interest billing receivables, net | $ 3,306,125 | $ 983,802 |
BASIS OF PRESENTATION AND SIG_7
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES - Schedule of Depletion (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||
Depletion | $ 21,711,123 | $ 14,163,574 | $ 63,203,473 | $ 34,417,978 |
Depletion rate, per barrel-of-oil-equivalent (Boe) | $ 13.48 | $ 11.59 | $ 13.09 | $ 11.95 |
BASIS OF PRESENTATION AND SIG_8
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES - Estimated Useful Lives (Details) | Sep. 30, 2023 |
Leasehold improvements | Minimum | |
Property, Plant and Equipment [Line Items] | |
Property, plant and equipment, useful life | 3 years |
Leasehold improvements | Maximum | |
Property, Plant and Equipment [Line Items] | |
Property, plant and equipment, useful life | 5 years |
Office equipment and software | Minimum | |
Property, Plant and Equipment [Line Items] | |
Property, plant and equipment, useful life | 3 years |
Office equipment and software | Maximum | |
Property, Plant and Equipment [Line Items] | |
Property, plant and equipment, useful life | 7 years |
Equipment | Minimum | |
Property, Plant and Equipment [Line Items] | |
Property, plant and equipment, useful life | 5 years |
Equipment | Maximum | |
Property, Plant and Equipment [Line Items] | |
Property, plant and equipment, useful life | 10 years |
Automobiles | |
Property, Plant and Equipment [Line Items] | |
Property, plant and equipment, useful life | 4 years |
Buildings and structures | |
Property, Plant and Equipment [Line Items] | |
Property, plant and equipment, useful life | 7 years |
BASIS OF PRESENTATION AND SIG_9
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES - Depreciation Expense (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||
Depreciation | $ 80,690 | $ 53,946 | $ 277,420 | $ 102,568 |
BASIS OF PRESENTATION AND SI_10
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES - Interest Paid Related to Notes Payables (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Debt Instrument [Line Items] | ||||
Interest expense | $ 11,381,754 | $ 7,021,385 | $ 32,322,840 | $ 13,699,045 |
Promissory Notes Payable | ||||
Debt Instrument [Line Items] | ||||
Interest expense | $ 22,286 | $ 7,917 | $ 35,211 | $ 17,201 |
BASIS OF PRESENTATION AND SI_11
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES - Provision for Income Taxes (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||
Deferred federal income tax benefit (provision) | $ 3,381,104 | $ (3,611,381) | $ 8,492,595 | $ (4,625,429) |
Current state income tax benefit (provision) | (165,780) | (36,736) | (264,261) | (36,736) |
Deferred state income tax benefit (provision) | 196,012 | (667,666) | (490,646) | (1,204,579) |
Benefit from (Provision for) Income Taxes | $ 3,411,336 | $ (4,315,783) | $ 7,737,688 | $ (5,866,744) |
BASIS OF PRESENTATION AND SI_12
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES - Schedule of Noncash Share-based Compensation Incurred (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||
Share-based compensation | $ 2,170,735 | $ 1,543,033 | $ 6,374,743 | $ 4,964,188 |
REVENUE RECOGNITION (Details)
REVENUE RECOGNITION (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Revenue from Contract with Customer [Abstract] | ||||
Oil | $ 90,392,004 | $ 86,413,665 | $ 252,020,403 | $ 229,532,827 |
Natural gas | 562,374 | 4,655,002 | 526,161 | 14,678,747 |
Natural gas liquids | 2,727,420 | 3,340,281 | 8,566,719 | 3,340,281 |
Total oil, natural gas, and natural gas liquids revenues | $ 93,681,798 | $ 94,408,948 | $ 261,113,283 | $ 247,551,855 |
LEASES - Narrative (Details)
LEASES - Narrative (Details) | Sep. 30, 2023 | May 09, 2023 | Oct. 01, 2022 | Jan. 01, 2021 |
Lessee, Lease, Description [Line Items] | ||||
Lease term of financing leases for vehicles | 36 months | |||
Midland Office Lease | ||||
Lessee, Lease, Description [Line Items] | ||||
Lessee, operating lease, term of contract | 5 years | |||
Amended Midland Office Lease | ||||
Lessee, Lease, Description [Line Items] | ||||
Lessee, operating lease, term of contract | 5 years | |||
Woodlands Sub-Lease | ||||
Lessee, Lease, Description [Line Items] | ||||
Lessee, operating lease, term of contract | 5 years 6 months | |||
Woodlands Office Lease | ||||
Lessee, Lease, Description [Line Items] | ||||
Lessee, operating lease, term of contract | 71 months |
LEASES - Future lease payments
LEASES - Future lease payments (Details) | 9 Months Ended |
Sep. 30, 2023 USD ($) | |
Operating lease payments | |
2023 | $ 118,616 |
2024 | 675,210 |
2025 | 727,460 |
2026 | 636,649 |
2027 | 460,497 |
Other Future Years | $ 400,234 |
Weighted average discount rate | 4.50% |
Imputed interest | $ 307,998 |
Weighted average remaining term | 4 years 6 months 3 days |
Financing lease payments | |
2023 | $ 223,492 |
2024 | 832,238 |
2025 | 493,290 |
2026 | 49,763 |
2027 | 0 |
Other Future Years | $ 0 |
Weighted average discount rate | 6.25% |
Imputed interest | $ 101,334 |
Weighted average remaining term | 2 years |
LEASES - Reconciliation between
LEASES - Reconciliation between the undiscounted future cash flows in the table above and the operating and financing lease liabilities (Details) - USD ($) | Sep. 30, 2023 | Dec. 31, 2022 |
Operating lease liability: | ||
Operating lease liability, current portion | $ 503,420 | $ 398,362 |
Operating lease liability, non-current portion | 2,207,248 | 1,473,897 |
Operating lease liability, total | 2,710,668 | 1,872,259 |
Total undiscounted future cash flows (sum of future operating lease payments) | 3,018,666 | 2,065,580 |
Imputed interest | 307,998 | 193,321 |
Undiscounted future cash flows less imputed interest | 2,710,668 | 1,872,259 |
Financing lease liability: | ||
Financing lease liability, current portion | 806,993 | 709,653 |
Financing lease liability, non-current portion | 690,456 | 1,052,479 |
Financing lease liability, total | 1,497,449 | 1,762,132 |
Total undiscounted future cash flows (sum of future financing lease payments) | 1,598,783 | 1,900,595 |
Imputed interest | 101,334 | 138,463 |
Undiscounted future cash flows less imputed interest | $ 1,497,449 | $ 1,762,132 |
LEASES - Supplemental informati
LEASES - Supplemental information regarding cash flows from operations (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Leases [Abstract] | ||||
Operating lease costs | $ 138,220 | $ 83,590 | $ 366,711 | $ 250,770 |
Short term lease costs | 1,012,525 | 639,708 | 4,042,160 | 1,937,310 |
Financing lease costs: | ||||
Amortization of financing lease assets | 197,221 | 106,982 | 572,744 | 334,447 |
Interest on financing lease liabilities | $ 23,416 | $ 10,391 | $ 73,115 | $ 24,184 |
EARNINGS (LOSS) PER SHARE INF_3
EARNINGS (LOSS) PER SHARE INFORMATION (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2023 | Jun. 30, 2023 | Mar. 31, 2023 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||||||
Net Income (Loss) | $ (7,539,222) | $ 28,791,605 | $ 32,715,779 | $ 75,085,891 | $ 41,944,422 | $ 7,112,043 | $ 53,968,162 | $ 124,142,356 |
Basic Weighted-Average Shares Outstanding (in shares) | 195,361,476 | 115,376,280 | 188,865,752 | 107,349,184 | ||||
Effect of dilutive securities: | ||||||||
Diluted Weighted-Average Shares Outstanding (in shares) | 195,361,476 | 151,754,995 | 194,583,215 | 134,826,275 | ||||
Basic Earnings (Loss) per Share (in usd per share) | $ (0.04) | $ 0.65 | $ 0.29 | $ 1.16 | ||||
Diluted Earnings (Loss) per Share (in usd per share) | $ (0.04) | $ 0.49 | $ 0.28 | $ 0.92 | ||||
Convertible Preferred Stock | ||||||||
Effect of dilutive securities: | ||||||||
Weighted average number diluted shares outstanding adjustment (in shares) | 0 | 14,337,127 | 0 | 4,831,559 | ||||
Common warrants | ||||||||
Effect of dilutive securities: | ||||||||
Weighted average number diluted shares outstanding adjustment (in shares) | 0 | 19,884,296 | 4,045,648 | 20,180,729 | ||||
Restricted Stock Units | ||||||||
Effect of dilutive securities: | ||||||||
Weighted average number diluted shares outstanding adjustment (in shares) | 0 | 1,908,662 | 1,310,409 | 2,135,675 | ||||
Performance stock units | ||||||||
Effect of dilutive securities: | ||||||||
Weighted average number diluted shares outstanding adjustment (in shares) | 0 | 196,520 | 361,406 | 235,440 | ||||
Stock options | ||||||||
Effect of dilutive securities: | ||||||||
Weighted average number diluted shares outstanding adjustment (in shares) | 0 | 52,110 | 0 | 93,688 |
EARNINGS (LOSS) PER SHARE INF_4
EARNINGS (LOSS) PER SHARE INFORMATION - Schedule of Securities Excluded from Computation of Earnings Per Share (Details) - shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Restricted Stock Units | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Number of shares excluded from the computation of diluted earnings per share (in shares) | 3,866,023 | 37,487 | 61,212 | 11,312 |
Performance Shares | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Number of shares excluded from the computation of diluted earnings per share (in shares) | 2,882,594 | 860,212 | 1,396,446 | 798,768 |
Common Stock | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Number of shares excluded from the computation of diluted earnings per share (in shares) | 265,500 | 70,500 | 265,500 | 70,500 |
ACQUISITIONS AND DIVESTITURES -
ACQUISITIONS AND DIVESTITURES - Narrative (Details) $ / shares in Units, a in Thousands | 3 Months Ended | 9 Months Ended | |||||||
Sep. 27, 2023 USD ($) | Jul. 10, 2023 USD ($) | May 11, 2023 USD ($) | Aug. 31, 2022 USD ($) a $ / shares shares | Sep. 30, 2023 USD ($) $ / shares | Sep. 30, 2023 USD ($) $ / shares | Sep. 30, 2022 USD ($) | Dec. 31, 2022 USD ($) $ / shares | Aug. 30, 2022 USD ($) | |
ACQUISITIONS & DIVESTITURES | |||||||||
Preferred stock, par value (in dollars per share) | $ / shares | $ 0.001 | $ 0.001 | $ 0.001 | ||||||
Asset retirement obligations | $ 28,762,663 | $ 28,762,663 | $ 30,226,306 | ||||||
Revolving Credit Facility | Truist Securities, Citizens Bank, KeyBanc Capital Markets, And Mizuho Bank Credit Facility | Line of Credit | |||||||||
ACQUISITIONS & DIVESTITURES | |||||||||
Line of credit facility, current borrowing capacity | $ 600,000,000 | $ 350,000,000 | |||||||
Delaware Basin | |||||||||
ACQUISITIONS & DIVESTITURES | |||||||||
Proceeds from divestiture of businesses | $ 8,300,000 | ||||||||
Purchase price, net of post close adjustments | 7,600,000 | ||||||||
Decrease in asset retirement obligation | $ 2,300,000 | ||||||||
New Mexico Divestiture | |||||||||
ACQUISITIONS & DIVESTITURES | |||||||||
Proceeds from divestiture of businesses | $ 4,500,000 | ||||||||
Purchase price, net of post close adjustments | 3,800,000 | ||||||||
Decrease in asset retirement obligation | $ 2,300,000 | ||||||||
Stronghold Acquisition | |||||||||
ACQUISITIONS & DIVESTITURES | |||||||||
Area of land | a | 37 | ||||||||
Fair value of consideration paid to seller | $ 394,000,000 | ||||||||
Closing amount paid to Founders | 165,900,000 | ||||||||
Contingent consideration | $ 15,000,000 | ||||||||
Payment period | 6 months | ||||||||
Inventory and fixed assets | $ 4,500,000 | ||||||||
Cash paid for realized oil derivative losses | $ 1,800,000 | ||||||||
Equity interest issued and issuable (in shares) | shares | 21,339,986 | ||||||||
Shares of Preferred Stock issued (in shares) | shares | 153,176 | ||||||||
Preferred stock, par value (in dollars per share) | $ / shares | $ 0.001 | ||||||||
As-Converted Shares of Ring Common Stock (in shares) | shares | 42,548,892 | ||||||||
Commodity Derivatives - Liabilities | $ 24,800,000 | ||||||||
Suspense Liability | 1,700,000 | ||||||||
Asset retirement obligations | $ 14,500,000 | ||||||||
Decrease in asset retirement obligation | 0 | $ (14,538,550) | |||||||
Deposit in escrow | 0 | 46,500,000 | |||||||
Founders Acquisition | |||||||||
ACQUISITIONS & DIVESTITURES | |||||||||
Closing amount paid to Founders | $ 42,502,799 | ||||||||
Asset retirement obligations | 2,090,777 | ||||||||
Decrease in asset retirement obligation | (2,090,777) | 0 | |||||||
Deposit in escrow | 7,500,000 | $ 7,500,000 | $ 0 | ||||||
Purchase price adjustments | 10,000,000 | ||||||||
Deferred cash payment | $ 15,000,000 | ||||||||
Deferred cash payment term | 4 months | ||||||||
Revenues | 6,300,000 | ||||||||
Operating expenses | $ 1,700,000 |
ACQUISITIONS AND DIVESTITURES_2
ACQUISITIONS AND DIVESTITURES - Preliminary Allocation of the Total Cost of the Founders Acquisition (Details) - USD ($) | 9 Months Ended | |||
Jul. 10, 2023 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | |
Fair value of assets acquired: | ||||
Oil and natural gas properties | $ 1,628,230,243 | $ 1,463,838,595 | ||
Fair value of assets acquired: | ||||
Asset retirement obligations | 28,762,663 | $ 30,226,306 | ||
Founders Acquisition | ||||
Investing Activities - Cash Paid | ||||
Deposit in escrow | $ 7,500,000 | 7,500,000 | $ 0 | |
Closing amount paid to Founders | 42,502,799 | |||
Interest from escrow deposit | 1,747 | 1,747 | 0 | |
Fair value of deferred payment liability | 14,657,383 | |||
Post-close adjustments | (1,463,632) | (1,463,632) | 0 | |
Total cash consideration | 63,198,297 | |||
Direct transaction costs | 1,361,843 | $ 1,361,843 | $ 0 | |
Total consideration | 64,560,140 | |||
Fair value of assets acquired: | ||||
Oil and natural gas properties | 67,562,084 | |||
Amount attributable to assets acquired | 67,562,084 | |||
Fair value of assets acquired: | ||||
Suspense liability | 677,116 | |||
Asset retirement obligations | 2,090,777 | |||
Ad valorem tax liability | 234,051 | |||
Amount attributable to liabilities assumed | 3,001,944 | |||
Net assets acquired | $ 64,560,140 |
DERIVATIVE FINANCIAL INSTRUME_3
DERIVATIVE FINANCIAL INSTRUMENTS - Impact of Company's contracts on its Balance Sheets (Details) - USD ($) | Sep. 30, 2023 | Dec. 31, 2022 |
Assets | ||
Derivative assets, current | $ 5,772,513 | $ 16,193,327 |
Discounted deferred premiums | (3,927,380) | (11,524,165) |
Derivatives assets, current, net of premiums | 1,845,133 | 4,669,162 |
Derivative assets, noncurrent | 6,465,355 | 7,606,258 |
Discounted deferred premiums | 0 | (1,476,848) |
Derivative assets, noncurrent, net of premiums | 6,465,355 | 6,129,410 |
Derivative Instruments and Hedges, Liabilities [Abstract] | ||
Derivative liabilities, current | 23,906,800 | 13,345,619 |
Derivative liabilities, noncurrent | $ 18,089,847 | $ 10,485,650 |
DERIVATIVE FINANCIAL INSTRUME_4
DERIVATIVE FINANCIAL INSTRUMENTS - Components of gain (loss) on derivative contracts (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Unrealized gain (loss) on derivatives | $ (26,483,190) | $ (2,201,970) | ||
Gain (loss) on derivative contracts | $ (39,222,755) | $ 32,851,189 | (26,483,190) | (2,201,970) |
Oil | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Realized gain (loss) on derivatives | (5,825,427) | (13,958,195) | (7,323,030) | (47,690,961) |
Unrealized gain (loss) on derivatives | (34,077,473) | 49,680,492 | (21,425,316) | 48,360,099 |
Gain (loss) on derivative contracts | (39,902,900) | 35,722,297 | (28,748,346) | 669,138 |
Natural Gas | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Realized gain (loss) on derivatives | 474,629 | (902,921) | 1,493,302 | (902,921) |
Unrealized gain (loss) on derivatives | 205,516 | (1,968,187) | 771,854 | (1,968,187) |
Gain (loss) on derivative contracts | $ 680,145 | $ (2,871,108) | $ 2,265,156 | $ (2,871,108) |
DERIVATIVE FINANCIAL INSTRUME_5
DERIVATIVE FINANCIAL INSTRUMENTS - Schedule of Components of Cash (Paid) Received for Commodity Derivative Settlements (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Cash flows from operating activities | ||||
Cash (paid) received for derivative settlements | $ (5,350,798) | $ (14,861,116) | $ (5,829,728) | $ (48,593,882) |
Oil | ||||
Cash flows from operating activities | ||||
Cash (paid) received for derivative settlements | (5,825,427) | (13,958,195) | (7,323,030) | (47,690,961) |
Natural Gas | ||||
Cash flows from operating activities | ||||
Cash (paid) received for derivative settlements | $ 474,629 | $ (902,921) | $ 1,493,302 | $ (902,921) |
DERIVATIVE FINANCIAL INSTRUME_6
DERIVATIVE FINANCIAL INSTRUMENTS - Current derivative contracts (Details) | 9 Months Ended |
Sep. 30, 2023 MMBTU $ / bbl $ / MMBTU bbl | |
Oil | Swap | Q4 2023 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (Bbl) | bbl | 138,000 |
Weighted average swap price (in usd per share) | 74.52 |
Oil | Swap | Q1 2024 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (Bbl) | bbl | 170,625 |
Weighted average swap price (in usd per share) | 67.40 |
Oil | Swap | Q2 2024 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (Bbl) | bbl | 156,975 |
Weighted average swap price (in usd per share) | 66.40 |
Oil | Swap | Q3 2024 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (Bbl) | bbl | 282,900 |
Weighted average swap price (in usd per share) | 65.49 |
Oil | Swap | Q4 2024 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (Bbl) | bbl | 368,000 |
Weighted average swap price (in usd per share) | 68.43 |
Oil | Swap | Q1 2025 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (Bbl) | bbl | 0 |
Weighted average swap price (in usd per share) | 0 |
Oil | Swap | Q2 2025 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (Bbl) | bbl | 0 |
Weighted average swap price (in usd per share) | 0 |
Oil | Swap | Q3 2025 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (Bbl) | bbl | 184,000 |
Weighted average swap price (in usd per share) | 73.35 |
Oil | Swap | Q4 2025 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (Bbl) | bbl | 0 |
Weighted average swap price (in usd per share) | 0 |
Oil | Argus Basis Swaps | Q4 2023 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (MMBtu) | MMBTU | 305,000 |
Weighted average swap price (in usd per share) | $ / MMBTU | 1.10 |
Oil | Argus Basis Swaps | Q1 2024 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (MMBtu) | MMBTU | 364,000 |
Weighted average swap price (in usd per share) | $ / MMBTU | 1.15 |
Oil | Argus Basis Swaps | Q2 2024 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (MMBtu) | MMBTU | 364,000 |
Weighted average swap price (in usd per share) | $ / MMBTU | 1.15 |
Oil | Argus Basis Swaps | Q3 2024 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (MMBtu) | MMBTU | 368,000 |
Weighted average swap price (in usd per share) | $ / MMBTU | 1.15 |
Oil | Argus Basis Swaps | Q4 2024 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (MMBtu) | MMBTU | 368,000 |
Weighted average swap price (in usd per share) | $ / MMBTU | 1.15 |
Oil | Argus Basis Swaps | Q1 2025 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (MMBtu) | MMBTU | 270,000 |
Weighted average swap price (in usd per share) | $ / MMBTU | 1 |
Oil | Argus Basis Swaps | Q2 2025 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (MMBtu) | MMBTU | 273,000 |
Weighted average swap price (in usd per share) | $ / MMBTU | 1 |
Oil | Argus Basis Swaps | Q3 2025 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (MMBtu) | MMBTU | 276,000 |
Weighted average swap price (in usd per share) | $ / MMBTU | 1 |
Oil | Argus Basis Swaps | Q4 2025 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (MMBtu) | MMBTU | 276,000 |
Weighted average swap price (in usd per share) | $ / MMBTU | 1 |
Oil | Deferred premium puts | Q4 2023 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (Bbl) | bbl | 165,600 |
Weighted average strike price (in usd per share) | 83.78 |
Weighted average deferred premium price (in usd per share) | 14.61 |
Oil | Deferred premium puts | Q1 2024 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (Bbl) | bbl | 45,500 |
Weighted average strike price (in usd per share) | 84.70 |
Weighted average deferred premium price (in usd per share) | 17.15 |
Oil | Deferred premium puts | Q2 2024 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (Bbl) | bbl | 45,500 |
Weighted average strike price (in usd per share) | 82.80 |
Weighted average deferred premium price (in usd per share) | 17.49 |
Oil | Deferred premium puts | Q3 2024 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (Bbl) | bbl | 0 |
Weighted average strike price (in usd per share) | 0 |
Weighted average deferred premium price (in usd per share) | 0 |
Oil | Deferred premium puts | Q4 2024 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (Bbl) | bbl | 0 |
Weighted average strike price (in usd per share) | 0 |
Weighted average deferred premium price (in usd per share) | 0 |
Oil | Deferred premium puts | Q1 2025 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (Bbl) | bbl | 0 |
Weighted average strike price (in usd per share) | 0 |
Weighted average deferred premium price (in usd per share) | 0 |
Oil | Deferred premium puts | Q2 2025 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (Bbl) | bbl | 0 |
Weighted average strike price (in usd per share) | 0 |
Weighted average deferred premium price (in usd per share) | 0 |
Oil | Deferred premium puts | Q3 2025 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (Bbl) | bbl | 0 |
Weighted average strike price (in usd per share) | 0 |
Weighted average deferred premium price (in usd per share) | 0 |
Oil | Deferred premium puts | Q4 2025 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (Bbl) | bbl | 0 |
Weighted average strike price (in usd per share) | 0 |
Weighted average deferred premium price (in usd per share) | 0 |
Oil | Three-way collars | Q4 2023 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (Bbl) | bbl | 15,598 |
Weighted average put price (in usd per share) | 45 |
Weighted average second put price (in usd per share) | 55 |
Weighted average call price (in usd per share) | 80.05 |
Oil | Three-way collars | Q1 2024 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (Bbl) | bbl | 0 |
Weighted average put price (in usd per share) | 0 |
Weighted average second put price (in usd per share) | 0 |
Weighted average call price (in usd per share) | 0 |
Oil | Three-way collars | Q2 2024 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (Bbl) | bbl | 0 |
Weighted average put price (in usd per share) | 0 |
Weighted average second put price (in usd per share) | 0 |
Weighted average call price (in usd per share) | 0 |
Oil | Three-way collars | Q3 2024 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (Bbl) | bbl | 0 |
Weighted average put price (in usd per share) | 0 |
Weighted average second put price (in usd per share) | 0 |
Weighted average call price (in usd per share) | 0 |
Oil | Three-way collars | Q4 2024 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (Bbl) | bbl | 0 |
Weighted average put price (in usd per share) | 0 |
Weighted average second put price (in usd per share) | 0 |
Weighted average call price (in usd per share) | 0 |
Oil | Three-way collars | Q1 2025 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (Bbl) | bbl | 0 |
Weighted average put price (in usd per share) | 0 |
Weighted average second put price (in usd per share) | 0 |
Weighted average call price (in usd per share) | 0 |
Oil | Three-way collars | Q2 2025 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (Bbl) | bbl | 0 |
Weighted average put price (in usd per share) | 0 |
Weighted average second put price (in usd per share) | 0 |
Weighted average call price (in usd per share) | 0 |
Oil | Three-way collars | Q3 2025 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (Bbl) | bbl | 0 |
Weighted average put price (in usd per share) | 0 |
Weighted average second put price (in usd per share) | 0 |
Weighted average call price (in usd per share) | 0 |
Oil | Three-way collars | Q4 2025 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (Bbl) | bbl | 0 |
Weighted average put price (in usd per share) | 0 |
Weighted average second put price (in usd per share) | 0 |
Weighted average call price (in usd per share) | 0 |
Oil | Two-way collars | Q4 2023 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (Bbl) | bbl | 274,285 |
Weighted average put price (in usd per share) | 56.73 |
Weighted average call price (in usd per share) | 70.77 |
Oil | Two-way collars | Q1 2024 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (Bbl) | bbl | 339,603 |
Weighted average put price (in usd per share) | 64.20 |
Weighted average call price (in usd per share) | 79.73 |
Oil | Two-way collars | Q2 2024 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (Bbl) | bbl | 325,847 |
Weighted average put price (in usd per share) | 64.30 |
Weighted average call price (in usd per share) | 79.09 |
Oil | Two-way collars | Q3 2024 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (Bbl) | bbl | 230,000 |
Weighted average put price (in usd per share) | 64 |
Weighted average call price (in usd per share) | 76.50 |
Oil | Two-way collars | Q4 2024 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (Bbl) | bbl | 128,800 |
Weighted average put price (in usd per share) | 60 |
Weighted average call price (in usd per share) | 73.24 |
Oil | Two-way collars | Q1 2025 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (Bbl) | bbl | 474,750 |
Weighted average put price (in usd per share) | 57.06 |
Weighted average call price (in usd per share) | 75.82 |
Oil | Two-way collars | Q2 2025 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (Bbl) | bbl | 464,100 |
Weighted average put price (in usd per share) | 60 |
Weighted average call price (in usd per share) | 69.85 |
Oil | Two-way collars | Q3 2025 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (Bbl) | bbl | 184,000 |
Weighted average put price (in usd per share) | 65 |
Weighted average call price (in usd per share) | 80.08 |
Oil | Two-way collars | Q4 2025 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (Bbl) | bbl | 0 |
Weighted average put price (in usd per share) | 0 |
Weighted average call price (in usd per share) | 0 |
Natural Gas | NYMEX Swaps | Q4 2023 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Weighted average swap price (in usd per share) | $ / MMBTU | 3.35 |
Hedged volume (MMBtu) | MMBTU | 134,102 |
Natural Gas | NYMEX Swaps | Q1 2024 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Weighted average swap price (in usd per share) | $ / MMBTU | 3.62 |
Hedged volume (MMBtu) | MMBTU | 152,113 |
Natural Gas | NYMEX Swaps | Q2 2024 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Weighted average swap price (in usd per share) | $ / MMBTU | 3.61 |
Hedged volume (MMBtu) | MMBTU | 138,053 |
Natural Gas | NYMEX Swaps | Q3 2024 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Weighted average swap price (in usd per share) | $ / MMBTU | 3.59 |
Hedged volume (MMBtu) | MMBTU | 121,587 |
Natural Gas | NYMEX Swaps | Q4 2024 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Weighted average swap price (in usd per share) | $ / MMBTU | 4.45 |
Hedged volume (MMBtu) | MMBTU | 644,946 |
Natural Gas | NYMEX Swaps | Q1 2025 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Weighted average swap price (in usd per share) | $ / MMBTU | 3.78 |
Hedged volume (MMBtu) | MMBTU | 616,199 |
Natural Gas | NYMEX Swaps | Q2 2025 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Weighted average swap price (in usd per share) | $ / MMBTU | 3.43 |
Hedged volume (MMBtu) | MMBTU | 591,725 |
Natural Gas | NYMEX Swaps | Q3 2025 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Weighted average swap price (in usd per share) | $ / MMBTU | 3.73 |
Hedged volume (MMBtu) | MMBTU | 285,200 |
Natural Gas | NYMEX Swaps | Q4 2025 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Weighted average swap price (in usd per share) | $ / MMBTU | 0 |
Hedged volume (MMBtu) | MMBTU | 0 |
Natural Gas | Waha basis swaps | Q4 2023 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (MMBtu) | MMBTU | 324,021 |
Weighted average swap price (in usd per share) | $ / MMBTU | 0.55 |
Natural Gas | Waha basis swaps | Q1 2024 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (MMBtu) | MMBTU | 0 |
Weighted average swap price (in usd per share) | $ / MMBTU | 0 |
Natural Gas | Waha basis swaps | Q2 2024 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (MMBtu) | MMBTU | 0 |
Weighted average swap price (in usd per share) | $ / MMBTU | 0 |
Natural Gas | Waha basis swaps | Q3 2024 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (MMBtu) | MMBTU | 0 |
Weighted average swap price (in usd per share) | $ / MMBTU | 0 |
Natural Gas | Waha basis swaps | Q4 2024 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (MMBtu) | MMBTU | 0 |
Weighted average swap price (in usd per share) | $ / MMBTU | 0 |
Natural Gas | Waha basis swaps | Q1 2025 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (MMBtu) | MMBTU | 0 |
Weighted average swap price (in usd per share) | $ / MMBTU | 0 |
Natural Gas | Waha basis swaps | Q2 2025 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (MMBtu) | MMBTU | 0 |
Weighted average swap price (in usd per share) | $ / MMBTU | 0 |
Natural Gas | Waha basis swaps | Q3 2025 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (MMBtu) | MMBTU | 0 |
Weighted average swap price (in usd per share) | $ / MMBTU | 0 |
Natural Gas | Waha basis swaps | Q4 2025 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (MMBtu) | MMBTU | 0 |
Weighted average swap price (in usd per share) | $ / MMBTU | 0 |
Natural Gas | El Paso Permian Basis Basis Swaps | Q4 2023 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (MMBtu) | MMBTU | 459,683 |
Weighted average swap price (in usd per share) | $ / MMBTU | 0.63 |
Natural Gas | El Paso Permian Basis Basis Swaps | Q1 2024 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (MMBtu) | MMBTU | 0 |
Weighted average swap price (in usd per share) | $ / MMBTU | 0 |
Natural Gas | El Paso Permian Basis Basis Swaps | Q2 2024 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (MMBtu) | MMBTU | 0 |
Weighted average swap price (in usd per share) | $ / MMBTU | 0 |
Natural Gas | El Paso Permian Basis Basis Swaps | Q3 2024 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (MMBtu) | MMBTU | 0 |
Weighted average swap price (in usd per share) | $ / MMBTU | 0 |
Natural Gas | El Paso Permian Basis Basis Swaps | Q4 2024 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (MMBtu) | MMBTU | 0 |
Weighted average swap price (in usd per share) | $ / MMBTU | 0 |
Natural Gas | El Paso Permian Basis Basis Swaps | Q1 2025 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (MMBtu) | MMBTU | 0 |
Weighted average swap price (in usd per share) | $ / MMBTU | 0 |
Natural Gas | El Paso Permian Basis Basis Swaps | Q2 2025 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (MMBtu) | MMBTU | 0 |
Weighted average swap price (in usd per share) | $ / MMBTU | 0 |
Natural Gas | El Paso Permian Basis Basis Swaps | Q3 2025 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (MMBtu) | MMBTU | 0 |
Weighted average swap price (in usd per share) | $ / MMBTU | 0 |
Natural Gas | El Paso Permian Basis Basis Swaps | Q4 2025 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (MMBtu) | MMBTU | 0 |
Weighted average swap price (in usd per share) | $ / MMBTU | 0 |
Natural Gas | Two-way collars | Put Option | Q4 2023 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (MMBtu) | MMBTU | 383,587 |
Weighted average put price (in usd per share) | $ / MMBTU | 3.15 |
Natural Gas | Two-way collars | Put Option | Q1 2024 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (MMBtu) | MMBTU | 591,500 |
Weighted average put price (in usd per share) | $ / MMBTU | 4 |
Natural Gas | Two-way collars | Put Option | Q2 2024 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (MMBtu) | MMBTU | 568,750 |
Weighted average put price (in usd per share) | $ / MMBTU | 4 |
Natural Gas | Two-way collars | Put Option | Q3 2024 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (MMBtu) | MMBTU | 552,000 |
Weighted average put price (in usd per share) | $ / MMBTU | 4 |
Natural Gas | Two-way collars | Put Option | Q4 2024 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (MMBtu) | MMBTU | 0 |
Weighted average put price (in usd per share) | $ / MMBTU | 0 |
Natural Gas | Two-way collars | Put Option | Q1 2025 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (MMBtu) | MMBTU | 0 |
Weighted average put price (in usd per share) | $ / MMBTU | 0 |
Natural Gas | Two-way collars | Put Option | Q2 2025 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (MMBtu) | MMBTU | 0 |
Weighted average put price (in usd per share) | $ / MMBTU | 0 |
Natural Gas | Two-way collars | Put Option | Q3 2025 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (MMBtu) | MMBTU | 285,200 |
Weighted average put price (in usd per share) | $ / MMBTU | 3 |
Natural Gas | Two-way collars | Put Option | Q4 2025 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (MMBtu) | MMBTU | 0 |
Weighted average put price (in usd per share) | $ / MMBTU | 0 |
Natural Gas | Two-way collars | Call Option | Q4 2023 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (MMBtu) | MMBTU | 383,587 |
Weighted average call price (in usd per share) | $ / MMBTU | 4.51 |
Natural Gas | Two-way collars | Call Option | Q1 2024 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (MMBtu) | MMBTU | 591,500 |
Weighted average call price (in usd per share) | $ / MMBTU | 6.29 |
Natural Gas | Two-way collars | Call Option | Q2 2024 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (MMBtu) | MMBTU | 568,750 |
Weighted average call price (in usd per share) | $ / MMBTU | 6.29 |
Natural Gas | Two-way collars | Call Option | Q3 2024 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (MMBtu) | MMBTU | 552,000 |
Weighted average call price (in usd per share) | $ / MMBTU | 6.29 |
Natural Gas | Two-way collars | Call Option | Q4 2024 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (MMBtu) | MMBTU | 0 |
Weighted average call price (in usd per share) | $ / MMBTU | 0 |
Natural Gas | Two-way collars | Call Option | Q1 2025 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (MMBtu) | MMBTU | 0 |
Weighted average call price (in usd per share) | $ / MMBTU | 0 |
Natural Gas | Two-way collars | Call Option | Q2 2025 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (MMBtu) | MMBTU | 0 |
Weighted average call price (in usd per share) | $ / MMBTU | 0 |
Natural Gas | Two-way collars | Call Option | Q3 2025 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (MMBtu) | MMBTU | 285,200 |
Weighted average call price (in usd per share) | $ / MMBTU | 4.80 |
Natural Gas | Two-way collars | Call Option | Q4 2025 | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Hedged volume (MMBtu) | MMBTU | 0 |
Weighted average call price (in usd per share) | $ / MMBTU | 0 |
FAIR VALUE MEASUREMENTS (Detail
FAIR VALUE MEASUREMENTS (Details) - USD ($) | Sep. 30, 2023 | Dec. 31, 2022 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative Asset, Statement of Financial Position [Extensible Enumeration] | Derivative Asset, Current, Derivative assets | Derivative Asset, Current, Derivative assets |
Derivative Liability, Statement of Financial Position [Extensible Enumeration] | Derivative Liability, Current, Derivative liabilities | Derivative Liability, Current, Derivative liabilities |
Fair Value, Recurring | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Commodity Derivatives - Assets | $ 8,310,488 | $ 10,798,572 |
Commodity Derivatives - Liabilities | (41,996,647) | (23,831,269) |
Total | (33,686,159) | (13,032,697) |
Quoted prices in Active Markets for Identical Assets or (Liabilities) (Level 1) | Fair Value, Recurring | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Commodity Derivatives - Assets | 0 | 0 |
Commodity Derivatives - Liabilities | 0 | 0 |
Total | 0 | 0 |
Significant Other Observable Inputs (Level 2) | Fair Value, Recurring | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Commodity Derivatives - Assets | 8,310,488 | 10,798,572 |
Commodity Derivatives - Liabilities | (41,996,647) | (23,831,269) |
Total | (33,686,159) | (13,032,697) |
Significant Unobservable Inputs (Level 3) | Fair Value, Recurring | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Commodity Derivatives - Assets | 0 | 0 |
Commodity Derivatives - Liabilities | 0 | 0 |
Total | $ 0 | $ 0 |
REVOLVING LINE OF CREDIT (Detai
REVOLVING LINE OF CREDIT (Details) | 1 Months Ended | 9 Months Ended | ||
Aug. 31, 2022 USD ($) | Sep. 30, 2023 USD ($) | Dec. 31, 2022 USD ($) | Jul. 01, 2014 USD ($) | |
Line of Credit Facility [Line Items] | ||||
Line of credit facility, maximum borrowing capacity | $ 600,000,000 | $ 1,000,000,000 | ||
Pro forma leverage ratio, maximum threshold | 2 | |||
Borrowing base utilization, maximum threshold, percentage | 80% | |||
Company required to maintaining rolling basis | 24 months | |||
Minimum percentage of projected production to be hedged | 50% | |||
Hedge testing percentage | 0% | |||
Long-term line of credit | $ 428,000,000 | $ 415,000,000 | ||
Unused commitment fee percentage | 0.50% | |||
Unused line of credit | $ 171,200,000 | |||
Base Rate Loans | ||||
Line of Credit Facility [Line Items] | ||||
Interest rate | 0% | |||
Standby Letters of Credit | ||||
Line of Credit Facility [Line Items] | ||||
Long-term line of credit | $ 760,438 | |||
Standby Letters of Credit | State And Federal Agencies | ||||
Line of Credit Facility [Line Items] | ||||
Long-term line of credit | 260,000 | |||
Standby Letters of Credit | New Mexico Insurance Company | Surety Bond | ||||
Line of Credit Facility [Line Items] | ||||
Long-term line of credit | $ 500,438 | |||
Minimum | ||||
Line of Credit Facility [Line Items] | ||||
Current ratio | 1 | |||
Minimum | Base Rate Loans | ||||
Line of Credit Facility [Line Items] | ||||
Debt Instrument, Interest Rate Margin Percentage | 2% | |||
Maximum | ||||
Line of Credit Facility [Line Items] | ||||
Leverage ratio, total | 1.25 | 3 | ||
Utilization of borrowing base rate | 25% | |||
Hedge testing percentage | 25% | |||
Maximum | Base Rate Loans | ||||
Line of Credit Facility [Line Items] | ||||
Debt Instrument, Interest Rate Margin Percentage | 3% | |||
Adjusted term SOFR | Base Rate Loans | ||||
Line of Credit Facility [Line Items] | ||||
Debt instrument, basis spread on variable rate | 1% | |||
Adjusted term SOFR | Minimum | SOFR Loans | ||||
Line of Credit Facility [Line Items] | ||||
Debt instrument, basis spread on variable rate | 3% | |||
Adjusted term SOFR | Maximum | SOFR Loans | ||||
Line of Credit Facility [Line Items] | ||||
Debt instrument, basis spread on variable rate | 4% | |||
Federal Funds Rate | Base Rate Loans | ||||
Line of Credit Facility [Line Items] | ||||
Debt instrument, basis spread on variable rate | 0.50% |
ASSET RETIREMENT OBLIGATION - C
ASSET RETIREMENT OBLIGATION - Changes in Asset Retirement Obligations (Details) - USD ($) | 9 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Asset Retirement Obligation, Roll Forward Analysis [Roll Forward] | ||
Balance, December 31, 2022 | $ 30,226,306 | |
Liabilities acquired | 2,090,777 | |
Liabilities incurred | 261,786 | |
Asset retirement obligation sold | (4,717,507) | $ 0 |
Liabilities settled | (226,424) | |
Revision of estimate | 53,824 | $ 0 |
Accretion expense | 1,073,901 | |
Balance, September 30, 2023 | $ 28,762,663 |
ASSET RETIREMENT OBLIGATION -_2
ASSET RETIREMENT OBLIGATION - Current and Non-current Asset Retirement Obligations (Details) - USD ($) | Sep. 30, 2023 | Dec. 31, 2022 |
Asset Retirement Obligation Disclosure [Abstract] | ||
Asset retirement obligations, current | $ 279,681 | $ 635,843 |
Asset retirement obligations, non-current | 28,482,982 | 29,590,463 |
Asset retirement obligations | $ 28,762,663 | $ 30,226,306 |
STOCKHOLDERS' EQUITY - Narrativ
STOCKHOLDERS' EQUITY - Narrative (Details) - $ / shares | 3 Months Ended | 9 Months Ended | |||||||
Sep. 30, 2023 | Mar. 31, 2023 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Sep. 30, 2023 | Jun. 30, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Class of Stock [Line Items] | |||||||||
Class of warrant or right, outstanding (in shares) | 78,200 | 78,200 | |||||||
Exercise price of warrants or rights (in usd per share) | $ 0.80 | $ 0.80 | |||||||
Exercised (in shares) | 0 | ||||||||
Common warrants | |||||||||
Class of Stock [Line Items] | |||||||||
Class of warrant or right, outstanding (in shares) | 78,200 | 14,590,366 | 19,907,793 | 22,907,793 | 29,361,700 | 78,200 | 78,200 | 19,107,793 | 29,361,700 |
Exercised (in shares) | 4,517,427 | 3,000,000 | 6,453,907 | 0 | 19,029,593 | ||||
Underwritten Public Offering | Common warrants | |||||||||
Class of Stock [Line Items] | |||||||||
Exercise price of warrants or rights (in usd per share) | $ 0.80 | $ 0.80 | $ 0.80 | $ 0.80 | $ 0.80 | $ 0.80 | $ 0.80 | ||
Warrants and rights outstanding, term | 5 years |
STOCKHOLDERS' EQUITY - Schedule
STOCKHOLDERS' EQUITY - Schedule of Common Warrants Exercised (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||||||
Apr. 12, 2023 | Sep. 30, 2023 | Jun. 30, 2023 | Mar. 31, 2023 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Sep. 30, 2023 | Oct. 29, 2020 | |
Class Of Warrant Or Right, Exercisable [Roll Forward] | |||||||||
Exercised (in shares) | 0 | ||||||||
Exercisable, at period end (in shares) | 78,200 | 78,200 | |||||||
Class Of Warrant Or Right, Exercisable, Exercise Price [Roll Forward] | |||||||||
Exercised (in usd per share) | $ 0 | $ 0 | |||||||
Exercise price of warrants or rights at period end (in usd per share) | $ 0.80 | $ 0.80 | |||||||
Proceeds Received | $ 0 | $ 3,613,941 | $ 2,400,000 | $ 5,163,126 | $ 0 | ||||
Exercise price of warrants or rights (in usd per share) | $ 0.80 | $ 0.80 | |||||||
Aggregate proceeds | $ 8,997,543 | ||||||||
Exercise of common warrants issued in offering | $ 8,687,655 | $ 3,613,941 | $ 2,400,000 | $ 5,163,126 | |||||
Advisory fee | $ 309,888 | ||||||||
Exercise Agreement | |||||||||
Class Of Warrant Or Right, Exercisable [Roll Forward] | |||||||||
Exercisable, at period end (in shares) | 14,512,166 | ||||||||
Class Of Warrant Or Right, Exercisable, Exercise Price [Roll Forward] | |||||||||
Exercise price of warrants or rights at period end (in usd per share) | $ 0.62 | ||||||||
Exercise price of warrants or rights (in usd per share) | $ 0.62 | ||||||||
Securities Purchase Agreement | |||||||||
Class Of Warrant Or Right, Exercisable, Exercise Price [Roll Forward] | |||||||||
Exercise price of warrants or rights (in usd per share) | $ 0.80 | ||||||||
Common warrants | |||||||||
Class Of Warrant Or Right, Exercisable [Roll Forward] | |||||||||
Exercisable, at period start (in shares) | 78,200 | 14,590,366 | 19,107,793 | 22,907,793 | 29,361,700 | 29,361,700 | 19,107,793 | ||
Exercised (in shares) | (4,517,427) | (3,000,000) | (6,453,907) | 0 | (19,029,593) | ||||
Exercisable, at period end (in shares) | 78,200 | 78,200 | 14,590,366 | 19,907,793 | 22,907,793 | 29,361,700 | 78,200 | ||
Common warrants | Underwritten Public Offering | |||||||||
Class Of Warrant Or Right, Exercisable, Exercise Price [Roll Forward] | |||||||||
Exercise price of warrants or rights at period start (in usd per share) | $ 0.80 | $ 0.80 | $ 0.80 | $ 0.80 | $ 0.80 | $ 0.80 | $ 0.80 | ||
Exercised (in usd per share) | 0.80 | 0.80 | 0.80 | ||||||
Exercise price of warrants or rights at period end (in usd per share) | 0.80 | 0.80 | 0.80 | 0.80 | 0.80 | ||||
Exercise price of warrants or rights (in usd per share) | $ 0.80 | $ 0.80 | $ 0.80 | $ 0.80 | $ 0.80 | ||||
Common Warrants, Reduced Exercise Price | |||||||||
Class Of Warrant Or Right, Exercisable [Roll Forward] | |||||||||
Exercised (in shares) | (14,512,166) | ||||||||
Class Of Warrant Or Right, Exercisable, Exercise Price [Roll Forward] | |||||||||
Proceeds Received | $ 8,997,543 | ||||||||
Common Warrants, Reduced Exercise Price | Underwritten Public Offering | |||||||||
Class Of Warrant Or Right, Exercisable, Exercise Price [Roll Forward] | |||||||||
Exercised (in usd per share) | $ 0.62 |
EMPLOYEE STOCK OPTIONS AND RE_3
EMPLOYEE STOCK OPTIONS AND RESTRICTED STOCK UNITS - Compensation Expense Charged Against Income (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Retirement Benefits [Abstract] | ||||
Share-based compensation | $ 2,170,735 | $ 1,543,033 | $ 6,374,743 | $ 4,964,188 |
EMPLOYEE STOCK OPTIONS AND RE_4
EMPLOYEE STOCK OPTIONS AND RESTRICTED STOCK UNITS - Narrative (Details) - USD ($) | 9 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Stock options | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Per share weighted average price of shares purchased (in usd per share) | $ 1.95 | $ 2.32 |
Unrecognized compensation cost | $ 0 | |
Restricted Stock Units | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Employee service share-based compensation, nonvested awards, compensation not yet recognized, stock options (in shares) | $ 3,928,247 | |
Weighted average period of recognition | 1 year 10 months 6 days | |
Performance Shares | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Weighted average period of recognition | 1 year 7 months 6 days | |
Performance stock units | $ 5,314,823 | |
long term Incentive Plan (2011 Plan) | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of shares available for grant (in shares) | 341,755 | |
Omnibus Incentive Plan (2021 Plan) | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of shares available for grant (in shares) | 8,224,394 | |
Increase in number of shares available for grant (in shares) | 6,000,000 |
EMPLOYEE STOCK OPTIONS AND RE_5
EMPLOYEE STOCK OPTIONS AND RESTRICTED STOCK UNITS - Status of the Stock Options (Details) - USD ($) | 3 Months Ended | |||||
Sep. 30, 2023 | Jun. 30, 2023 | Mar. 31, 2023 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | |
Weighted- Average Exercise Price | ||||||
Granted (in usd per share) | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 |
Forfeited or rescinded (in usd per share) | 0 | 0 | 0 | 0 | 0 | 0 |
Exercised (in usd per share) | $ 0 | $ 0 | $ 0 | $ 0 | $ 2 | $ 0 |
Stock options | ||||||
Options | ||||||
Outstanding at beginning of the year (in shares) | 265,500 | 265,500 | 265,500 | 265,500 | 365,500 | 365,500 |
Granted (in shares) | 0 | 0 | 0 | 0 | 0 | 0 |
Forfeited or rescinded (in shares) | 0 | 0 | 0 | 0 | 0 | 0 |
Exercised (in shares) | 0 | 0 | 0 | 0 | (100,000) | 0 |
Outstanding at end of year (in shares) | 265,500 | 265,500 | 265,500 | 265,500 | 265,500 | 365,500 |
Options Exercisable at end of year (in shares) | 265,500 | 265,500 | ||||
Weighted- Average Exercise Price | ||||||
Outstanding at beginning of the year (in usd per share) | $ 4.21 | $ 4.21 | $ 4.21 | $ 4.21 | $ 3.61 | $ 3.61 |
Outstanding at end of year (in usd per share) | 4.21 | $ 4.21 | $ 4.21 | 4.21 | $ 4.21 | $ 3.61 |
Exercisable at end of year (in usd per share) | $ 4.21 | $ 4.21 | ||||
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Additional Disclosures [Abstract] | ||||||
Options Outstanding - Weighted-Average Remaining Contractual Term | 10 months 20 days | 1 year 1 month 20 days | 1 year 4 months 20 days | 1 year 10 months 20 days | 2 years 1 month 20 days | 2 years 2 months 15 days |
Options Exercisable - Weighted-Average Remaining Contractual Term | 10 months 20 days | 1 year 10 months 20 days | ||||
Aggregate Intrinsic Value | $ 0 | $ 0 | $ 0 | $ 62,400 | $ 128,700 | $ 536,900 |
EMPLOYEE STOCK OPTIONS AND RE_6
EMPLOYEE STOCK OPTIONS AND RESTRICTED STOCK UNITS - Status of Restricted Stock and Performance Shares Grants (Details) - $ / shares | 3 Months Ended | |||||
Sep. 30, 2023 | Jun. 30, 2023 | Mar. 31, 2023 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | |
Restricted Stock Units | ||||||
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares | ||||||
Outstanding at beginning of the year (in shares) | 3,885,267 | 4,223,441 | 2,623,790 | 3,211,900 | 3,819,657 | 2,572,596 |
Granted (in shares) | 0 | 0 | 2,270,842 | 126,570 | 19,642 | 1,247,061 |
Forfeited or rescinded (in shares) | (4,997) | (49,465) | (11,712) | 0 | (17,204) | 0 |
Vested (in shares) | (39,443) | (288,709) | (659,479) | (9,851) | (610,195) | 0 |
Outstanding at end of year (in shares) | 3,840,827 | 3,885,267 | 4,223,441 | 3,328,619 | 3,211,900 | 3,819,657 |
Weighted- Average Grant Date Fair Value | ||||||
Outstanding at beginning of the year (in usd per share) | $ 2.12 | $ 2.17 | $ 2.29 | $ 1.97 | $ 2.09 | $ 1.75 |
Granted (in usd per share) | 0 | 0 | 2.22 | 2.95 | 4.27 | 2.79 |
Forfeited or rescinded (in usd per share) | 2.22 | 2.22 | 2.22 | 0 | 2.79 | 0 |
Vested (in usd per share) | 2.87 | 2.85 | 2.80 | 2.69 | 2.80 | 0 |
Outstanding at end of year (in usd per share) | $ 2.12 | $ 2.12 | $ 2.17 | $ 2 | $ 1.97 | $ 2.09 |
Performance Shares | ||||||
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares | ||||||
Outstanding at beginning of the year (in shares) | 2,882,594 | 2,882,594 | 1,720,432 | 1,720,432 | 1,720,432 | 860,216 |
Granted (in shares) | 0 | 0 | 1,162,162 | 0 | 0 | 860,216 |
Forfeited or rescinded (in shares) | 0 | 0 | 0 | 0 | 0 | 0 |
Vested (in shares) | 0 | 0 | 0 | 0 | 0 | 0 |
Outstanding at end of year (in shares) | 2,882,594 | 2,882,594 | 2,882,594 | 1,720,432 | 1,720,432 | 1,720,432 |
Weighted- Average Grant Date Fair Value | ||||||
Outstanding at beginning of the year (in usd per share) | $ 3.34 | $ 3.34 | $ 3.76 | $ 3.76 | $ 3.76 | $ 3.87 |
Granted (in usd per share) | 0 | 0 | 2.71 | 0 | 0 | 3.65 |
Forfeited or rescinded (in usd per share) | 0 | 0 | 0 | 0 | 0 | 0 |
Vested (in usd per share) | 0 | 0 | 0 | 0 | 0 | 0 |
Outstanding at end of year (in usd per share) | $ 3.34 | $ 3.34 | $ 3.34 | $ 3.76 | $ 3.76 | $ 3.76 |
COMMITMENTS AND CONTINGENCIES -
COMMITMENTS AND CONTINGENCIES - Narrative (Details) - USD ($) | 9 Months Ended | ||
Sep. 30, 2023 | Aug. 31, 2022 | Jul. 01, 2014 | |
Loss Contingencies [Line Items] | |||
Line of credit facility, maximum borrowing capacity | $ 600,000,000 | $ 1,000,000,000 | |
Issued surety bonds | $ 650,288 | ||
Surety Bond | |||
Loss Contingencies [Line Items] | |||
Extended term for surety bonds | 1 year | ||
Surety Bond | NEW MEXICO | |||
Loss Contingencies [Line Items] | |||
Issued surety bonds | $ 500,438 | ||
Standby Letters of Credit | |||
Loss Contingencies [Line Items] | |||
Standby letters of credit drawn | 0 | ||
State And Federal Agencies | Standby Letters of Credit | |||
Loss Contingencies [Line Items] | |||
Line of credit facility, maximum borrowing capacity | $ 260,000 | ||
Extended term under letter of credit arrangement (in years) | 1 year | ||
Electric Utility Companies | Standby Letters of Credit | |||
Loss Contingencies [Line Items] | |||
Line of credit facility, maximum borrowing capacity | $ 500,438 |