Document And Entity Information
Document And Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2016 | Mar. 07, 2017 | Jun. 30, 2016 | |
Document And Entity Information [Abstract] | |||
Entity Registrant Name | Erin Energy Corp. | ||
Entity Central Index Key | 1,402,281 | ||
Trading Symbol | ERN | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Filer Category | Accelerated Filer | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2016 | ||
Document Fiscal Year Focus | 2,016 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false | ||
Entity Common Stock, Shares Outstanding | 213,223,392 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Public Float | $ 218,029,463 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Current assets: | ||
Cash and cash equivalents | $ 7,177 | $ 8,363 |
Restricted cash | 2,600 | 8,661 |
Accounts receivable - trade | 0 | 1,029 |
Accounts receivable - partners | 674 | 287 |
Accounts receivable - related party | 1,956 | 1,186 |
Accounts receivable - other | 29 | 28 |
Crude oil inventory | 9,398 | 4,789 |
Prepaids and other current assets | 872 | 684 |
Total current assets | 22,706 | 25,027 |
Property, plant and equipment: | ||
Oil and gas properties (successful efforts method of accounting), net | 265,713 | 368,891 |
Other property, plant and equipment, net | 716 | 1,174 |
Total property, plant and equipment, net | 266,429 | 370,065 |
Other non-current assets | ||
Other non-current assets | 66 | 67 |
Other assets, net | 66 | 67 |
Total assets | 289,201 | 395,159 |
Current liabilities: | ||
Accounts payable and accrued liabilities | 244,963 | 213,120 |
Accounts payable and accrued liabilities - related party | 29,513 | 30,133 |
Current portion of long-term debt, net | 12,627 | 96,558 |
Total current liabilities | 287,103 | 339,811 |
Long-term notes payable - related party | 74,446 | 0 |
Term loan facility | 129,796 | 120,006 |
Asset retirement obligations | 22,476 | 20,609 |
Total liabilities | 513,821 | 480,426 |
Commitments and contingencies (Note 11) | ||
Capital deficiency: | ||
Preferred stock $0.001 par value - 50,000,000 shares authorized; none issued and outstanding as of December 31, 2016 and 2015, respectively | 0 | 0 |
Common stock $0.001 par value - 416,666,667 shares authorized; 212,622,218 and 211,615,773 shares outstanding as of December 31, 2016 and 2015, respectively | 213 | 212 |
Additional paid-in capital | 792,972 | 789,615 |
Accumulated deficit | (1,018,292) | (875,891) |
Treasury stock at cost, 99,932 and -0- shares as of December 31, 2016 and 2015, respectively | (228) | 0 |
Total capital deficiency - Erin Energy Corporation | (225,335) | (86,064) |
Non-controlling interests | 715 | 797 |
Total capital deficiency | (224,620) | (85,267) |
Total liabilities and capital deficiency | $ 289,201 | $ 395,159 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parentheticals) - $ / shares | Dec. 31, 2016 | Dec. 31, 2015 |
Statement of Financial Position [Abstract] | ||
Preferred stock par value (in Dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, authorized shares (in shares) | 50,000,000 | 50,000,000 |
Preferred stock, issued shares (in shares) | 0 | 0 |
Preferred stock, outstanding shares (in shares) | 0 | 0 |
Common stock, par value (in Dollars per share) | $ 0.001 | $ 0.001 |
Common stock, authorized shares (in shares) | 416,666,667 | 416,666,667 |
Common stock, outstanding shares (in shares) | 212,622,218 | 211,615,773 |
Treasury stock, shares (in shares) | 99,932 | 0 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Revenues: | |||
Crude oil sales, net of royalties | $ 77,815 | $ 68,429 | $ 53,844 |
Operating costs and expenses: | |||
Production costs | 94,607 | 90,079 | 80,296 |
Crude oil inventory (increase) decrease | (1,469) | (2,502) | 14,512 |
Workover expenses | 7,860 | 972 | 0 |
Exploratory expenses | 39,269 | 16,437 | 14,283 |
Depreciation, depletion and amortization | 58,051 | 97,179 | 21,590 |
Asset retirement obligation accretion | 1,867 | 1,931 | 2,166 |
Impairment of oil and gas properties | 645 | 261,208 | 0 |
Loss on settlement of asset retirement obligations | 205 | 3,653 | 0 |
General and administrative expenses | 13,772 | 15,905 | 14,322 |
Total operating costs and expenses | 214,807 | 484,862 | 147,169 |
Operating loss | (136,992) | (416,433) | (93,325) |
Other income (expense): | |||
Currency transaction gain | 15,674 | 2,520 | 1,758 |
Interest expense | (21,924) | (17,986) | (4,383) |
Other, net | 0 | 0 | (358) |
Total other expense | (6,250) | (15,466) | (2,983) |
Loss before income taxes | (143,242) | (431,899) | (96,308) |
Income tax expense | 0 | 0 | 0 |
Net loss before non-controlling interest | (143,242) | (431,899) | (96,308) |
Net loss attributable to non-controlling interest | 841 | 962 | 246 |
Net loss attributable to Erin Energy Corporation | $ (142,401) | $ (430,937) | $ (96,062) |
Net loss attributable to Erin Energy Corporation per common share: | |||
Basic (Dollars per share) | $ (0.67) | $ (2.04) | $ (0.49) |
Diluted (Dollars per share) | $ (0.67) | $ (2.04) | $ (0.49) |
Weighted-average common shares outstanding: | |||
Basic (shares) | 212,318 | 211,616 | 194,745 |
Diluted (shares) | 212,318 | 211,616 | 194,745 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Statement of Comprehensive Income [Abstract] | |||
Net loss, before non-controlling interest | $ (143,242) | $ (431,899) | $ (96,308) |
Other comprehensive income (loss): | |||
Foreign currency translation | 0 | 0 | 0 |
Total other comprehensive (loss) income | 0 | 0 | 0 |
Comprehensive loss | (143,242) | (431,899) | (96,308) |
Comprehensive loss attributable to non-controlling interests | 841 | 962 | 246 |
Comprehensive loss attributable to Erin Energy Corporation | $ (142,401) | $ (430,937) | $ (96,062) |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (CAPITAL DEFICIENCY) - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-in Capital | Accumulated Deficit | Treasury Stock | Non-controlling Interest |
Beginning balance (in shares) at Dec. 31, 2013 | 146,637,000 | |||||
Beginning balance at Dec. 31, 2013 | $ 387,946 | $ 146 | $ 736,692 | $ (348,892) | $ 0 | $ 0 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Common stock issued (in shares) | 63,671,000 | |||||
Common stock issued | 270,415 | $ 64 | 270,351 | |||
Stock-based compensation | 3,492 | 3,492 | ||||
Allied acquisition | (220,000) | (220,000) | ||||
Allied Transaction adjustments | (12,440) | (12,440) | ||||
Non-controlling interest | 900 | 900 | ||||
Net loss | (96,308) | (96,062) | (246) | |||
Ending balance at Dec. 31, 2014 | 334,005 | $ 210 | 778,095 | (444,954) | 0 | 654 |
Ending balance (in shares) at Dec. 31, 2014 | 210,308,000 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Common stock issued (in shares) | 1,308,000 | |||||
Common stock issued | 1,980 | $ 2 | 1,978 | |||
Stock-based compensation | 4,631 | 4,631 | ||||
Non-controlling interest | 1,105 | 1,105 | ||||
Net loss | (431,899) | (430,937) | (962) | |||
Warrants issued with debt | 4,911 | 4,911 | ||||
Ending balance at Dec. 31, 2015 | $ (85,267) | $ 212 | 789,615 | (875,891) | 0 | 797 |
Ending balance (in shares) at Dec. 31, 2015 | 211,615,773 | 211,616,000 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Common stock issued (in shares) | 1,106,000 | |||||
Common stock issued | $ 364 | $ 1 | 363 | |||
Stock-based compensation | 2,941 | 2,941 | ||||
Non-controlling interest | 759 | 759 | ||||
Net loss | (143,242) | (142,401) | (841) | |||
Warrants issued with debt | 53 | 53 | ||||
Transfer to treasury upon vesting of restricted stock | (228) | (228) | ||||
Ending balance at Dec. 31, 2016 | $ (224,620) | $ 213 | $ 792,972 | $ (1,018,292) | $ (228) | $ 715 |
Ending balance (in shares) at Dec. 31, 2016 | 212,622,218 | 212,722,000 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Cash flows from operating activities | |||
Net loss, before non-controlling interest | $ (143,242) | $ (431,899) | $ (96,308) |
Adjustments to reconcile net loss to cash provided by (used in) operating activities: | |||
Depreciation, depletion and amortization | 58,051 | 97,179 | 21,590 |
Impairment of oil and gas properties | 645 | 261,208 | 0 |
Write-off of suspended exploratory well costs | 33,031 | 0 | 0 |
Asset retirement obligation accretion | 1,867 | 1,931 | 2,166 |
Amortization of debt issuance costs | 3,615 | 2,766 | 147 |
Loss on settlement of asset retirement obligations | 0 | 3,653 | 0 |
Related party liability offset | 0 | 0 | (32,880) |
Unrealized currency transaction gain | (15,674) | (2,520) | (1,572) |
Share-based compensation | 2,941 | 5,027 | 3,095 |
Payments to settle asset retirement obligations | 0 | (16,640) | 0 |
Other | 0 | 0 | (17) |
Changes in operating assets and liabilities: | |||
(Increase) decrease in accounts receivable | 630 | (804) | 562 |
(Increase) decrease in crude oil inventory | (1,469) | (2,502) | 14,512 |
(Increase) decrease in prepaids and other current assets | (187) | 746 | (1,672) |
Increase in other non-current assets | 0 | 0 | (15) |
Increase in accounts payable and accrued liabilities | 66,147 | 84,000 | 56,845 |
Net cash provided by (used in) operating activities | 6,355 | 2,145 | (33,547) |
Cash flows from investing activities | |||
Capital expenditures | (19,293) | (84,039) | (128,510) |
Allied transaction | 0 | 0 | (170,000) |
Net cash used in investing activities | (19,293) | (84,039) | (298,510) |
Cash flows from financing activities | |||
Proceeds from the issuance of common stock | 0 | 0 | 270,000 |
Proceeds from the exercise of stock options and warrants | 364 | 1,855 | 415 |
Payments for treasury stock arising from withholding taxes upon restricted stock vesting | (228) | 0 | 0 |
Proceeds from (repayments of) term loan facility | (5,968) | (337) | 100,000 |
Proceeds from note payable - related party, net | 6,829 | 61,815 | 10,649 |
Proceeds from short-term note payable | 504 | 0 | 0 |
Repayment of short-term note payable | (449) | 0 | 0 |
Debt issuance costs | (1,040) | 0 | (2,082) |
Funds released from restricted cash, net | 6,061 | 0 | 0 |
Funds restricted for debt service | 0 | 0 | (10,405) |
Allied Transaction adjustments | 0 | 0 | (12,440) |
Funding from non-controlling interest | 0 | 553 | 900 |
Net cash provided by financing activities | 6,073 | 63,886 | 357,037 |
Effect of exchange rate on cash and cash equivalents | 5,679 | 1,228 | 0 |
Net increase (decrease) in cash and cash equivalents | (1,186) | (16,780) | 24,980 |
Cash and cash equivalents at beginning of year | 8,363 | 25,143 | 163 |
Cash and cash equivalents at end of year | 7,177 | 8,363 | 25,143 |
Cash paid for: | |||
Interest, net of amounts capitalized | 10,407 | 11,114 | 8 |
Supplemental disclosure of non-cash investing and financing activities: | |||
Issuance of common shares for settlement of liabilities | 0 | 125 | 0 |
Discount on notes payable pursuant to issuance of warrants | 53 | 4,911 | 0 |
Reduction in oil and gas properties arising from settlement of accounts payable and accrued liabilities | 10,048 | 0 | 0 |
Reduction in accounts payable from settlement of Northern Offshore contingency | 0 | 24,307 | 0 |
Receivable from non-controlling interest | 0 | 552 | 0 |
Related party accounts payable, net, settled with related party notes payable | 0 | 0 | (32,880) |
Change in asset retirement obligation estimate | $ 0 | $ (4,284) | $ 3,766 |
Basis of Presentation and Signi
Basis of Presentation and Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Significant Accounting Policies | BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The accompanying consolidated financial statements include the accounts of the Company and its wholly-owned and majority-owned direct and indirect subsidiaries, and have been prepared in accordance with generally accepted accounting principles in the United States (“U.S. GAAP”) pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). All significant intercompany transactions and balances have been eliminated in consolidation. The consolidated financial statements reflect all adjustments that are, in the opinion of management, necessary for a fair presentation of the consolidated financial position and results of operations for the indicated periods. All such adjustments are of a normal recurring nature. In February 2014, the Company completed the acquisition of the remaining economic interests that it did not already own in the Production Sharing Contract covering Oil Mining Leases 120 and 121 located offshore Nigeria (the “OMLs”), which include the currently producing Oyo field (the “Allied Assets”), from Allied (the “Allied Transaction”). Pursuant to the terms of the Transfer Agreement entered into with Allied, the Company issued approximately 82.9 million shares of common stock to Allied, as partial consideration for the Allied Assets. Allied is a subsidiary of CEHL, the Company’s majority shareholder, and deemed to be under common control. Accordingly, the net assets acquired from Allied were recorded at their respective carrying values as of the acquisition date. The shares issued to Allied and the financial statements presented for all periods included herein are presented as though the transfer of the Allied Assets had occurred in June 2012, the effective date when Allied acquired the Allied Assets from an independent third party. See Note 4. — Acquisitions for further information. Effective April 22, 2015 , the Company implemented a reverse stock split, whereby each six shares of outstanding common stock pre-split was converted into one share of common stock post-split (the “reverse stock split”). All share and per share amounts for all periods presented herein have been adjusted to reflect the reverse stock split as if it had occurred at the beginning of the first period presented. Adoption of Previously Issued ASUs In April 2015, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2015-03, Interest - Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs , which requires that debt issuance costs be presented as a direct deduction from the carrying amount of the related debt liability, consistent with the presentation of debt discounts. Prior to the issuance of ASU 2015-03, the Company recorded and presented debt issuance costs as part of prepaids and other current assets, separate from the related debt liability. ASU 2015-03 does not change the recognition and measurement requirement for debt issuance costs. Other than this reclassification, the adoption of ASU 2015-03 did not have an impact on the Company's consolidated financial statements. Significant Accounting Policies Principles of Consolidation The consolidated financial statements include the accounts and activities of the Company, subsidiaries in which the Company has a controlling financial interest, and entities for which the Company is the primary beneficiary. All material intercompany accounts and transactions have been eliminated in consolidation. Use of Estimates The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates based on assumptions. Estimates affect the reported amounts of assets and liabilities, disclosure of contingent liabilities, and the reported amounts of revenues and expenses during the reporting periods. Accordingly, accounting estimates require the exercise of judgment. While management believes that the estimates and assumptions used in the preparation of the Company’s consolidated financial statements are appropriate, actual results could differ from those estimates. Estimates that may have a significant effect on the Company’s financial position and results from operations include share-based compensation assumptions, oil and natural gas reserve quantities, impairment of oil and gas properties, depletion and amortization relating to oil and gas properties, asset retirement obligation assumptions, and income taxes. The accounting estimates used in the preparation of the consolidated financial statements may change as new events occur, more experience is acquired, additional information is obtained and our operating environment changes. Cash and Cash Equivalents Cash and cash equivalents include cash on hand, demand deposits and short-term investments with initial maturities of three months or less. Restricted Cash Restricted cash consists of cash deposits that are contractually restricted for withdrawal or required to be maintained in a reserve bank account for a specific period of time, as provided for under certain agreements with third parties. Restricted cash as of December 31, 2016 and 2015 , consists of $2.6 million and $8.7 million , respectively, held in a debt service reserve account to secure certain interest and principal repayments pursuant to the Term Loan Facility in Nigeria. Accounts Receivable and Allowance for Doubtful Accounts Accounts receivable are accounted for at cost less allowance for doubtful accounts. The Company establishes provisions for losses on accounts receivable if it is determined that collection of all or a part of an outstanding balance is not probable. Collectability is reviewed regularly and an allowance is established or adjusted, as necessary, using the specific identification method. As of December 31, 2016 and 2015 , no allowance for doubtful accounts was necessary. As of December 31, 2015 , the Company had a $1.0 million trade receivable for the remaining balance owed from its December 2015 crude oil sale. As of December 31, 2016 , its trade receivable balance was nil . Partner accounts receivable consist of balances owed from joint venture (“JV”) partners. As of December 31, 2016 and 2015 , the Company was owed $0.7 million and $0.3 million from its Ghana JV partners for their share of the expenditures incurred in the Shallow Water Tano block, pursuant to the Ghana JV Joint Operating Agreement. Crude Oil Inventory Inventories of crude oil are valued at the lower of cost or market using the first-in, first-out method and include certain costs directly related to the production process and depletion, depreciation and amortization attributable to the underlying oil and gas properties. The Company had crude oil inventory of $9.4 million and $4.8 million as of December 31, 2016 and 2015 , respectively. Successful Efforts Method of Accounting for Oil and Gas Activities The Company follows the successful efforts method of accounting for its costs of acquisition, exploration and development of oil and gas properties. Under this method, oil and gas lease acquisition costs and intangible drilling costs associated with exploration efforts that result in the discovery of proved reserves and costs associated with development drilling, whether or not successful, are capitalized when incurred. Drilling costs of exploratory wells are capitalized pending determination that proved reserves have been found. If the determination is dependent upon the results of planned additional wells and require additional capital expenditures to develop the reserves, the drilling costs will be capitalized as long as sufficient reserves have been found to justify completion of the exploratory well as a producing well, and additional wells are underway or firmly planned to complete the evaluation of the well. Exploratory wells not meeting the criteria for continued capitalization are expensed when such a determination is made. Other exploration costs are expensed as incurred. A portion of the Company’s oil and gas properties include oilfield materials and supplies inventory to be used in connection with the Company’s drilling program. These inventories are stated at the lower of cost or market, which approximates fair value, and they are regularly assessed for obsolescence. Oilfield materials and supplies inventory balances were $34.7 million and $30.0 million at December 31, 2016 and 2015 , respectively. Depreciation, depletion and amortization costs for productive oil and gas properties are recorded on a unit-of-production basis. For other depreciable property, depreciation is recorded on a straight-line basis over the estimated useful life of the assets, which range between three to five years , or the lease term if shorter. Repairs and maintenance charges, including workover costs, are charged to expense as incurred. Impairment of Long-Lived Assets The Company reviews its long-lived assets in property, plant and equipment for impairment each reporting period, or whenever changes in circumstances indicate that the carrying amount of assets may not be fully recoverable. Possible indicators of impairment include lower expected future oil and gas prices, actual or expected future development or operating costs significantly higher than previously anticipated, significant downward oil and gas reserve revisions, or when changes in other circumstances indicate the carrying amount of an asset may not be recoverable. An impairment loss is recognized for proved properties when the estimated undiscounted future cash flows expected to result from the asset are less than its carrying amount. The Company estimates the future undiscounted cash flows of the affected properties to judge the recoverability of carrying amounts. Cash flows are determined on the basis of reasonable and documented assumptions that represent the best estimate of the future economic conditions during the remaining useful life of the asset. The Company’s cash flow projections into the future include assumptions on variables, such as future sales, sales prices, operating costs, economic conditions, market competition and inflation. Prices used to quantify the expected future cash flows are estimated based on forward prices prevailing in the marketplace and management’s long-term planning assumptions. Impairment is measured by the excess of carrying amount over the fair value of the assets. Unevaluated leasehold costs are assessed for impairment at the end of each reporting period and transferred to proved oil and gas properties to the extent they are associated with successful exploration activities. Significant unevaluated leasehold costs are assessed individually for impairment, based on the Company’s current exploration plans, and any indicated impairment is charged to expense. Asset Retirement Obligations The Company accounts for asset retirement obligations in accordance with applicable accounting guidelines , which require that the fair value of a liability for an asset retirement obligation be recognized in the period in which it is incurred. Specifically, the Company records a liability for the present value, using a credit-adjusted risk free interest rate, of the estimated site restoration costs with a corresponding increase to the carrying amount of the related long-lived asset. Revenues Revenues are recognized when crude oil is delivered to a buyer. The recognition criteria are satisfied when there exists a signed contract with defined pricing, delivery, and acceptance, and there is no significant uncertainty of collectability. Crude oil revenues are recorded net of royalties. Income Taxes The Company accounts for income taxes using the asset and liability method of accounting for income taxes in accordance with applicable accounting rules. Under the asset and liability method, deferred tax assets and liabilities are recognized for temporary differences between the tax bases of assets and liabilities and their carrying values for financial reporting purposes and for operating loss and tax credit carry-forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance is established to reduce deferred tax assets to their net realizable amounts if it is more likely than not that the related tax benefits will not be fully realized. The Company routinely evaluates any tax deduction and tax refund position in a two-step process. The first step is to determine whether it is more likely than not that a tax position will be sustained. If that test is met, the second step is to determine the amount of benefit or expense to recognize in the consolidated financial statements. See Note 13. — Income Taxes for further information. Debt Issuance Costs Debt issuance costs consist of certain costs paid to lenders in the process of securing a borrowing facility. Debt issuance costs incurred are capitalized and subsequently charged to interest expense over the term of the related debt, using the effective interest rate method. As a result of the adoption of ASU No. 2015-03, Interest - Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs , the Company reclassified approximately $1.6 million of unamortized debt issuance costs related to its Term Loan Facility (see Note 9 - Debt ) from prepaids and other current assets to current portion of long-term debt within its consolidated balance sheet as of December 31, 2015 . As of December 31, 2016 and 2015 , unamortized debt issuance costs were $2.3 million and $1.6 million , of which $1.6 million and nil was classified as long-term, respectively. The current portion of the debt issuance costs, which was $0.8 million and $1.6 million as of December 31, 2016 and 2015 , respectively, is presented as a reduction to the current portion of long-term debt. Capitalized Interest The Company capitalizes interest costs for qualifying oil and gas properties. The capitalization period begins when expenditures are incurred on qualified properties, activities begin which are necessary to prepare the property for production, and interest costs have been incurred. The capitalization period continues as long as these events occur. Capitalized interest is added to the cost of the underlying assets and is depleted using the unit-of-production method in the same manner as the underlying assets. During the years ended December 31, 2016 and 2015 , the Company capitalized nil and $2.2 million , respectively, in interest cost as additions to property, plant and equipment related to the Oyo field redevelopment campaign. Stock-Based Compensation The Company recognizes all stock-based payments to employees, including grants of employee stock options, in the consolidated financial statements based on their grant-date fair values. The Company values its stock options awarded using the Black-Scholes option pricing model. Restricted stock awards are valued at the grant date closing market price. Stock-based compensation costs are recognized over the vesting period, which is the period during which the employee is required to provide service in exchange for the award. Stock-based compensation paid to non-employees are valued at the fair value of the goods or services provided at the applicable measurement date and charged to expense as services are rendered. Treasury Stock Treasury stock is reported at cost and is included in the accompanying consolidated balance sheets. Pursuant to the Company’s withholding tax policy with respect to vested restricted stock awards, the Company may withhold, on a cashless basis, a number of shares needed to settle statutory withholding tax requirements. During the year ended December 31, 2016, 99,932 shares were withheld for taxes at a total cost of $0.2 million . The Company had no treasury stock withheld for taxes during the year ended December 31, 2015. The following table sets forth information with respect to the withholding and related repurchases of the Company's common stock during the year ended December 31, 2016 . Total Number of Average Price January 1 - January 31, 2016 3,643 $ 4.02 February 1 - February 29, 2016 62,152 $ 2.16 March 1 - March 31, 2016 17,318 $ 2.31 May 1 - May 31, 2016 1,072 $ 2.48 September 1 - September 30, 2016 6,162 $ 2.29 November 1 - November 30, 2016 6,175 $ 2.35 December 1 - December 31, 2016 3,410 $ 2.10 Total 99,932 $ 2.28 (1) All shares repurchased were surrendered by employees to settle tax withholding obligations upon the vesting of restricted stock awards. Reporting and Functional Currency The Company has adopted the U.S. dollar as the functional currency for all of its foreign subsidiaries. Gains and losses on foreign currency transactions are included in results of operations. Net Earnings (Loss) Per Common Share Basic net earnings or loss per common share is computed by dividing net earnings or loss by the weighted average number of shares of common stock outstanding at the end of the reporting period. Diluted net earnings or loss per share is computed by dividing net earnings or loss by the fully dilutive common stock equivalent, which consists of shares outstanding, augmented by potentially dilutive shares issuable upon the exercise of the Company’s stock options, non-vested restricted stock awards, and stock warrants and conversion of the 2014 Convertible Subordinated Note, calculated using the treasury stock method. The table below sets forth the number of stock options, warrants, non-vested restricted stock, and shares issuable upon conversion of Convertible Subordinated Note that were excluded from dilutive shares outstanding during the years ended December 31, 2016 , 2015 and 2014 , as these securities are anti-dilutive because the Company was in a loss position each year. Years Ended December 31, (In thousands) 2016 2015 2014 Stock options 230 1,101 1,038 Stock warrants 3 541 6 Unvested restricted stock awards 1,942 1,275 997 Convertible note — 12,379 10,932 2,175 15,296 12,973 Upon the occurrence of certain events, the Company is also contingently liable to make additional payments to Allied, under the Transfer Agreement, up to an additional amount totaling $50.0 million in cash, or the equivalent in shares of the Company’s common stock, at Allied’s option. See Note 11. — Commitments and Contingencies for further information. Non-Controlling Interests The Company reports its non-controlling interests as a separate component of equity. The Company also presents the consolidated net loss and the portion of the consolidated net loss allocable to the non-controlling interests and to the shareholders of the Company separately in its consolidated statements of operations. Losses attributable to the non-controlling interests are allocated to the non-controlling interests even when those losses are in excess of the non-controlling interests’ investment basis. As of December 31, 2016 and 2015 , the non-controlling interest recorded in equity was $0.7 million and $0.8 million , respectively, attributable to the joint ownership of an affiliate in our Erin Energy Ghana Limited subsidiary. Fair Value Measurements Fair value is defined as the amount at which an asset (or liability) could be bought (or incurred) or sold (or settled) in an orderly transaction between market participants at the measurement date. The established framework for measuring fair value establishes a fair value hierarchy based on the quality of inputs used to measure fair value, and includes certain disclosure requirements. Fair value estimates are based on either (i) actual market data or (ii) assumptions that other market participants would use in pricing an asset or liability, including estimates of risk. There are three levels of valuation hierarchy for disclosure of fair value measurements. The valuation hierarchy categorizes assets and liabilities measured at fair value into one of three different levels depending on the observability of the inputs employed in the measurement. The three levels are defined as follows: Level 1 - Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities. The Company considers active markets as those in which transactions for the assets or liabilities occur in sufficient frequency and volume to provide pricing information on an on-going basis. Level 2 - Quoted prices in markets that are not active, or inputs which are observable, either directly or indirectly, for substantially the full term of the asset or liability. Substantially all of these inputs are observable in the marketplace throughout the term, can be derived from observable data, or supported by observable levels at which transactions are executed in the marketplace. Level 3 - Inputs that are unobservable and significant to the fair value measurement (including the Company’s own assumptions in determining fair value). The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability. Fair Value on a Non-Recurring Basis The Company used discounted cash flow techniques to determine the estimated fair value of its oil and gas properties as part of the Company's analysis for impairment. Accordingly, the Company estimated the present value of expected future net cash flows from the Oyo field, discounted using risk-adjusted cost of capital. Significant Level 3 assumptions used in the calculation include the Company's estimate of future crude oil prices, production costs, development costs, and anticipated production of proved reserves, as well as appropriate risk-adjusted probable and possible reserves. The following table presents information about the Company’s oil and gas properties measured at fair value on a non-recurring basis: Level 3 As of December 31, (in thousands) 2016 2015 Value of oil and gas properties (1) $ — $ 293,408 (1) This represents non-financial assets that are measured at fair value on a non-recurring basis due to impairments. This is the fair value of the asset base that was subjected to impairment and does not reflect the entire asset balance as presented on the accompanying balance sheets. Please see Note 5. — Property, Plant and Equipment for further information. Amounts included here are presented only in years where an impairment has occurred. Other than the write-off of the carrying value of its offshore leases in Kenya (as discussed under Note 5 - Property, Plant and Equipment ), there was no impairment to the Company's oil and gas properties for the year ended December 31, 2016 . Fair Value of Financial Instruments The carrying amounts of the Company’s financial instruments, which include cash and cash equivalents, restricted cash, accounts receivable, inventory, deposits, accounts payable and accrued liabilities, and debts at floating interest rates, approximate their fair values at December 31, 2016 and 2015 , respectively, principally due to the short-term nature, maturities or nature of interest rates of the above listed items. Risks and Uncertainties The Company’s producing properties are located offshore Nigeria. Substantially all of the Company’s crude oil available for sale is sold under spot sales contracts and is delivered Free on Board ("FOB") at the point of transfer from the FPSO, as is customary in the industry. During the years ended December 31, 2016 and 2015 , the Company sold its crude oil under spot sales contracts with one customer and two customers, respectively. The Company believes that the potential loss of one or both of these customers would not prevent it from selling its crude oil, as it will find other buyers for its crude oil. Reclassification Certain reclassifications have been made to the 2015 and 2014 consolidated financial statements to conform to the 2016 presentation. These reclassifications were not material to the accompanying consolidated financial statements. Recently Issued Accounting Standards In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) . ASU 2016-02 is aimed at making leasing activities more transparent and comparable, and requires substantially all leases be recognized by lessees on their balance sheet as a right-of-use asset and corresponding lease liability, including leases currently accounted for as operating leases. ASU 2016-02 is effective for the Company in the fiscal year beginning after December 15, 2018, and interim periods within those fiscal years with early adoption permitted. The Company is still evaluating the impact of this standard. However, due to the nature of its operations, the adoption of this standard could have a material impact on its consolidated financial statements. In March 2016, the FASB issued ASU No. 2016-07, Investments-Equity Method and Joint Ventures (Topic 323): Simplifying the Transition to the Equity Method of Accounting . ASU No. 2016-07 eliminates the requirement to retroactively adopt the equity method of accounting. ASU No. 2016-07 is effective for interim and annual periods beginning after December 15, 2016, and the Company will adopt this standards update, as required, beginning with the first quarter of 2017. The adoption of this standards update is not expected to have a material impact on the Company’s consolidated financial statements. In March 2016, the FASB issued ASU No. 2016-08, Revenue from Contracts with Customers (Topic 606): Principal versus Agent Consideration (Reporting Revenue Gross versus Net) . ASU No. 2016-08 requires that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. ASU No. 2016-08 is effective for interim and annual periods beginning after December 15, 2017, and the Company will adopt this standards update, as required, beginning with the first quarter of 2018. The adoption of this standards update is not expected to have a material impact on the Company’s consolidated financial statements. In March 2016, the FASB issued ASU No. 2016-09, Compensation-Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting . The areas of simplification in ASU No. 2016-09 involve several aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. ASU No. 2016-09 is effective for interim and annual periods beginning after December 15, 2016, and the Company will adopt this standards update, as required, beginning with the first quarter of 2017. The adoption of this standards update is not expected to have a material impact on the Company’s consolidated financial statements. In April 2016, the FASB issued ASU No. 2016-10, Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing . ASU No. 2016-10 clarifies two aspects of Topic 606: identifying performance obligations and the licensing implementation guidance, while retaining the related principles for those areas. ASU No. 2016-10 is effective for interim and annual periods beginning after December 15, 2017, and the Company will adopt this standards update, as required, beginning with the first quarter of 2018. The adoption of this standards update is not expected to have a material impact on the Company’s consolidated financial statements. In May 2016, the FASB issued ASU No. 2016-11, Revenue Recognition (Topic 605) and Derivatives and Hedging (Topic 815): Rescission of SEC Guidance Because of Accounting Standards Updates 2014-09 and 2014-16 Pursuant to Staff Announcements at the March 3, 2016 EITF Meeting . ASU No. 2016-11 rescinds SEC Staff Observer comments that are codified in Topic 605, Revenue Recognition, and Topic 932, Extractive Activities - Oil and Gas, effective upon adoption of Topic 606. ASU No. 2016-11 is effective for interim and annual periods beginning after December 15, 2017, and the Company will adopt this standards update, as required, beginning with the first quarter of 2018. The adoption of this standards update is not expected to have a material impact on the Company’s consolidated financial statements. In May 2016, the FASB issued ASU No. 2016-12, Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients . The core principle of ASU No. 2016-12 is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. ASU No. 2016-12 is effective for interim and annual periods beginning after December 15, 2017, and the Company will adopt this standards update, as required, beginning with the first quarter of 2018. The adoption of this standards update is not expected to have a material impact on the Company’s consolidated financial statements. In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments , which is intended to reduce diversity in practice in reporting certain items in the statement of cash flows. ASU No. 2016-15 is effective for interim and annual periods beginning after December 15, 2017, and the Company will adopt this standards update, as required, beginning with the first quarter of 2018. The Company does not expect adoption of ASU 2016-15 to have a material effect on its consolidated financial statements. In October 2016, the FASB issued ASU 2016-16, Intra-Entity Transfers of Assets Other Than Inventory , which provides guidance on recognition of current income tax consequences for intra-entity asset transfers (other than inventory) at the time of transfer. This represents a change from current GAAP, where the consolidated tax consequences of intra-entity asset transfers are deferred until the transferred asset is sold to a third party or otherwise recovered through use. The guidance is effective for annual reporting periods beginning after December 15, 2017 and interim periods within those annual periods. Early adoption at the beginning of an annual period is permitted. The adoption of this update is not expected to have a material impact on the Company’s consolidated financial statements. In October 2016, the FASB issued ASU 2016-17, Interests Held through Related Parties That Are under Common Control , which modifies existing guidance with respect to how a decision maker that holds an indirect interest in a VIE through a common control party determines whether it is the primary beneficiary of the VIE as part of the analysis of whether the VIE would need to be consolidated. Under this ASU, a decision maker would need to consider only its proportionate indirect interest in the VIE held through a common control party. This ASU is effective for annual reporting periods beginning after December 15, 2016 and interim periods within those annual periods. The adoption of this update is not expected to have a material impact on the Company’s consolidated financial statements. In November 2016, the FASB issued ASU 2016-18, S tatement of Cash Flows (Topic 230): Restricted Cash , which requires amounts generally described as restricted cash and restricted cash equivalents be included with cash and cash equivalents when reconciling the total beginning and ending amounts for the periods shown on the statement of cash flows. ASU 2016-18 is effective for fiscal years beginning after December 15, 2018 (including interim periods within those periods) using a retrospective transition method to each period presented. The adoption of this update is not expected to have a material impact on the Company’s consolidated financial statements. |
Company Description
Company Description | 12 Months Ended |
Dec. 31, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Company Description | COMPANY DESCRIPTION Erin Energy Corporation (NYSE MKT: ERN, JSE: ERN) is an independent exploration and production company engaged in the acquisition and development of energy resources in Africa. The Company’s asset portfolio consists of seven licenses across four countries covering an area of approximately 19,000 square kilometers (approximately 5 million acres). The Company owns producing properties and conducts exploration activities offshore Nigeria, conducts exploration activities offshore Ghana and The Gambia, and onshore Kenya. The Company is headquartered in Houston, Texas and has offices in Lagos, Nigeria, Nairobi, Kenya, Banjul, The Gambia, Accra, Ghana and Johannesburg, South Africa. The Company’s operating subsidiaries include Erin Petroleum Nigeria Limited (“EPNL”), Erin Energy Kenya Limited, Erin Energy Gambia Ltd., and Erin Energy Ghana Limited. The terms “we,” “us,” “our,” “the Company,” and “our Company” refer to Erin Energy Corporation and its subsidiaries. The Company also conducts certain business transactions with its majority shareholder, CAMAC Energy Holdings Limited (“CEHL”), and its affiliates, which include Allied Energy Plc (“Allied”). See Note 10. — Related Party Transactions for further information. In May 2016, Dr. Kase L. Lawal retired from service as a member and Executive Chairman of the Board of Directors and Chief Executive Officer. John Hofmeister, a then current member of the Board of Directors, succeeded Dr. Lawal as the Chairman of the Board of Directors, and Babatunde (Segun) Omidele, the Company's then Chief Operating Officer, succeeded Dr. Lawal as the Chief Executive Officer. On February 16, 2017, Babatunde (Segun) Omidele informed the Company that he will be resigning from service as a member of the Board of Directors and as the Chief Executive Officer of the Company. The Board accepted his resignation effective as of February 22, 2017. The Board has appointed Jean-Michel Malek, the Company’s Senior Vice President, General Counsel and Secretary, to serve as Interim Chief Executive Officer effective February 22, 2017 while the Board conducts a search for a permanent replacement for Mr. Omidele. |
Liquidity Matters and Going Con
Liquidity Matters and Going Concern | 12 Months Ended |
Dec. 31, 2016 | |
Liquidity Matters [Abstract] | |
Liquidity Matters and Going Concern | LIQUIDITY AND GOING CONCERN The Company has incurred losses from operations in each of the years ended December 31, 2016, 2015 and 2014. As of December 31, 2016 , the Company's total current liabilities of $287.1 million exceeded its total current assets of $22.7 million , resulting in a working capital deficit of $264.4 million . As a result of the current low commodity prices and the Company’s low oil production volumes due to the recent mechanical problem associated with well Oyo-8 that was resolved during the earlier part of 2016, the Company has not been able to generate sufficient cash from operations to satisfy certain obligations as they became due. Well Oyo-7 is currently shut-in as a result of an emergency shut-in of the Oyo field production that occurred in early July 2016. This has resulted in a loss of approximately 1,400 BOPD from the field. The Company is currently working on relocating an existing gaslift line to well Oyo-7 to enable continuous gaslift operation. For cost effectiveness, the relocation of the gaslift line to well Oyo-7 is now planned to be combined with the Oyo-9 subsea equipment installation scheduled for the third quarter of 2017. The Company is currently pursuing a number of actions, including i) obtaining additional funds through public or private financing sources, ii) restructuring existing debts from lenders, iii) obtaining forbearance of debt from trade creditors, iv) reducing ongoing operating costs, v) minimizing projected capital costs for the 2017 exploration and development campaign, vi) farming-out a portion of our rights to certain of our oil and gas properties and vii) exploring potential business combination transactions. There can be no assurances that sufficient liquidity can be raised from one or more of these actions or that these actions can be consummated within the period needed to meet certain obligations. The Company's consolidated financial statements have been prepared under the assumption that it will continue as a going concern, which assumes the continuity of operations, the realization of assets and the satisfaction of liabilities as they come due in the normal course of business. Although the Company believes that it will be able to generate sufficient liquidity from the measures described above, its current circumstances raise substantial doubt about its ability to continue to operate as a going concern. The accompanying consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty. |
Acquisitions
Acquisitions | 12 Months Ended |
Dec. 31, 2016 | |
Business Combinations [Abstract] | |
Acquisitions | ACQUISITIONS The Allied Assets In February 2014, the Company completed the Allied Transaction, thereby acquiring the Allied Assets. Pursuant to the terms of the Transfer Agreement, the Company, as partial consideration for the Allied Assets, paid $170.0 million in cash, issued approximately 82.9 million shares of the Company’s common stock and entered into the 2014 Convertible Subordinated Note. To fund the cash portion of the Allied Transaction and a portion of the anticipated capital expenditures for the development of the Oyo field, the Company also entered into a Share Purchase Agreement (the “Share Purchase Agreement”) with the Public Investment Corporation (SOC) Limited, a state-owned company incorporated in the Republic of South Africa (“PIC”), for an aggregate cash investment of $270.0 million through a private placement of 62.8 million shares of common stock (the “Private Placement”). Additional contingent payments are owed to Allied upon the occurrence of certain future events. See Note 11. — Commitments and Contingencies for additional information regarding the contingent payments due to Allied. The table below sets forth a summary of the contractual purchase consideration paid for the Allied Assets ( In thousands ): Cash consideration paid $ 170,000 Erin Energy Corporation common stock (1) — Long-term convertible subordinated note payable - related party 50,000 Total purchase price $ 220,000 Asset acquired and liabilities assumed as of February 21, 2014: Property, plant and equipment, net $ 248,736 Accounts payable (25,429 ) Asset retirement obligations (20,890 ) Net assets acquired 202,417 Excess of consideration paid over carrying value of assets acquired $ 17,583 (1) Because the cash and debt consideration exceeds the carrying value of the assets acquired, no value was assigned to the shares issued Because Allied is a wholly owned subsidiary of CEHL, the Company’s majority shareholder, Allied and the Company are deemed under common control. Accordingly, the net assets acquired from Allied were recorded at their respective carrying values as of the acquisition date. The consolidated financial statements, included herein, are presented as though the Allied Transaction had occurred in June 2012, the date Allied acquired the Allied Assets from an independent third party. For the periods prior to January 1, 2014, the Allied Assets were recorded as if CEHL had acquired the Allied Assets and contributed them to the Company. This includes the cost to acquire the Allied Assets from a third party in June 2012, as well as costs related to the drilling of the Oyo-7 well incurred by Allied in 2013. Award of the Tano Block in Ghana In April 2014, the Company, through an indirect 50% -owned subsidiary, signed a Petroleum Agreement with the Republic of Ghana (the “Petroleum Agreement”) for the Expanded Shallow Water Tano block offshore Ghana ("ESWT"). The contracting parties, which hold 90% of the participating interest in the block, are Erin Energy Ghana Limited as the operator, GNPC Exploration and Production Company Limited, and Base Energy (collectively the "Contracting Parties"), holding 60% , 25% , and 15% share of the participating interest of the Contracting Parties, respectively. The Ghana National Petroleum Company initially has a 10% carried interest through the exploration phase, and will have the option to acquire an additional paying interest of up to 10% following a declaration of commercial discovery. The ESWT block contains three previously discovered fields (the "Fields") and the work program requires the Contracting Parties to determine, within nine months of the effective date of the Petroleum Agreement, the economic viability of developing the Fields. In addition, the Petroleum Agreement provides for an initial exploration period of two years from the effective date of the Petroleum Agreement, with specified work obligations during that period, including the reprocessing of existing 2-D and 3-D seismic data and the drilling of one exploration well on the ESWT block. The Contracting Parties have the right to apply for a first extension period of one and one-half years and a second extension period of up to two and one-half years. Each extension period has specified additional minimum work obligations, including (i) conducting geological and geophysical studies during the first extension period and (ii) drilling one exploration well during the first extension period and, depending on the length of the extension, one or two wells during the second extension period. In January 2015, the Petroleum Agreement became effective, following the signing of a Joint Operating Agreement between the Contracting Parties. In October 2015, at the completion of the initial technical and commercial evaluation of the Fields, the Contracting Parties concluded that certain fiscal terms in the Petroleum Agreement had to be adjusted in order to achieve commerciality of the Fields under current economic conditions. The Contracting Parties have presented this conclusion to the relevant government entities. The Ghanian Government is currently reviewing the requests for adjustment of the fiscal terms, and has granted the Company an extension of the Initial Exploration Period for eighteen months until the end of July 2018. |
Property, Plant and Equipment
Property, Plant and Equipment | 12 Months Ended |
Dec. 31, 2016 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment | PROPERTY, PLANT AND EQUIPMENT Property, plant and equipment were comprised of the following: As of December 31, (In thousands) 2016 2015 Wells and production facilities $ 318,739 $ 329,133 Proved properties 386,196 386,196 Work in progress and exploration inventory 34,712 65,043 Oilfield assets 739,647 780,372 Accumulated depletion (483,754 ) (421,921 ) Oilfield assets, net 255,893 358,451 Unevaluated leaseholds 9,820 10,440 Oil and gas properties, net 265,713 368,891 Other property and equipment 3,040 2,963 Accumulated depreciation (2,324 ) (1,789 ) Other property and equipment, net 716 1,174 Total property, plant and equipment, net $ 266,429 $ 370,065 All of the Company’s oilfield assets are located offshore Nigeria in the OMLs. “Work-in-progress and exploration inventory” includes suspended costs for wells that are not yet completed, as well as warehouse inventory items purchased as part of the redevelopment plan of the Oyo field. During the year ended December 31, 2016 , the Company wrote off $33.0 million of suspended exploratory well costs to exploration expense. See Note 6. — Suspended Exploratory Well Costs for further information The Company’s unevaluated leasehold costs include costs to acquire the rights to the exploration acreage in its various oil and gas properties. The $9.8 million unevaluated leasehold cost as of December 31, 2016 includes the $1.0 million payment during 2015 to extend the initial exploration period for the Gambia Licenses and the $1.2 million payment in 2014 to acquire rights to the Ghana properties. Impairment of Oil and Gas Properties The Company used discounted cash flow techniques to determine the estimated fair value of its oil and gas properties as part of the Company's analysis for impairment. Accordingly, the Company estimated the present value of expected future net cash flows from the Oyo field, discounted using risk-adjusted cost of capital. Significant Level 3 assumptions used in the calculation include the Company's estimate of future crude oil prices, production costs, development costs, and anticipated production of proved reserves, as well as appropriate risk-adjusted probable and possible reserves. In December 2016, the Company recorded a non-cash impairment charge of $0.6 million , mainly to write-off the carrying value of its offshore leases in Kenya because the Company no longer intends to renew or extend its leases on these offshore blocks. In December 2015, the Company concluded that the carrying value of its oilfield assets would not be recoverable under the then current market conditions. Accordingly, the Company recorded a non-cash impairment charge of $228.6 million to reduce the carrying value of its oil and gas properties to their estimated fair values as of December 31, 2015 . In addition, the Company recorded a charge of $32.6 million to write-off the carrying value of well Oyo-5 from work in progress because the Company no longer intends to recomplete it into a water injection well under current plans. |
Suspended Exploratory Well Cost
Suspended Exploratory Well Costs | 12 Months Ended |
Dec. 31, 2016 | |
Extractive Industries [Abstract] | |
Suspended Exploratory Well Costs | SUSPENDED EXPLORATORY WELL COSTS In November 2013, the Company achieved both its primary and secondary drilling objectives for the well Oyo-7. The primary drilling objective was to establish production from the existing Pliocene reservoir. The secondary drilling objective was to confirm the presence of hydrocarbons in the deeper Miocene formation. Hydrocarbons were encountered in three Miocene intervals totaling approximately 65 feet, as interpreted by the logging-while-drilling (“LWD”) data. As of December 31, 2015 , the Company’s suspended exploratory well costs were $26.5 million for the costs related to the Miocene exploratory drilling activities. Plans are underway to secure a rig to drill at least one exploration well in the nearby G-Prospect. However, due to current economics, the primary objective of the G-Prospect is no longer to target the same Miocene formation as the ones found in the Oyo-7 exploratory drilling. As such, during the year ended December 31, 2016 , the Company wrote off the $26.5 million to exploration expense. In August 2014, the Company drilled well Oyo-8 to a total vertical depth of approximately 6,059 feet (approximately 1,847 meters) and successfully encountered four new oil and gas reservoirs in the eastern fault block, with total gross hydrocarbon thickness of 112 feet, based on results from the LWD data, reservoir pressure measurement, and reservoir fluid sampling. Management completed a detailed evaluation of the results and initially capitalized suspended exploratory well costs amounting to $6.5 million at December 31, 2015 for the costs related to the Pliocene exploration drilling activities in the eastern fault block. During the year ended December 31, 2016 , the Company wrote off the $6.5 million to exploration expense as current drilling plans will no longer specifically target such area due to current economics. |
Accounts Payable and Accrued Li
Accounts Payable and Accrued Liabilities | 12 Months Ended |
Dec. 31, 2016 | |
Payables and Accruals [Abstract] | |
Accounts Payable and Accrued Liabilities | ACCOUNTS PAYABLE AND ACCRUED LIABILITIES The table below sets forth a summary of the Company’s accounts payable and accrued liabilities at December 31, 2016 and 2015 : As of December 31, (In thousands) 2016 2015 Accounts payable - vendors $ 173,306 $ 153,085 Amounts due to government entities 66,573 53,119 Accrued interest 3,074 2,510 Accrued payroll and benefits 1,204 629 Other liabilities 806 3,777 $ 244,963 $ 213,120 |
Asset Retirement Obligations
Asset Retirement Obligations | 12 Months Ended |
Dec. 31, 2016 | |
Asset Retirement Obligation Disclosure [Abstract] | |
Asset Retirement Obligations | ASSET RETIREMENT OBLIGATIONS The Company’s asset retirement obligations primarily represent the estimated fair value of the amounts that will be incurred to plug, abandon and remediate its producing properties at the end of their productive lives. Significant inputs used in determining such obligations include, but are not limited to, estimates of plugging and abandonment costs, estimated future inflation rates and changes in property lives. The inputs used in the fair value determination were based on Level 3 inputs, which were essentially management's assumptions. The following table summarizes changes in the Company’s asset retirement obligations during the years ended December 31, 2016 and 2015 : (In thousands) 2016 2015 Asset retirement obligations at January 1 $ 20,609 $ 26,533 Accretion expense 1,867 1,931 Additions — 9,416 Revisions in estimated liabilities — (4,284 ) Loss on settlement of asset retirement obligations — 3,653 Payments to settle asset retirement obligations — (16,640 ) Asset retirement obligations at December 31 $ 22,476 $ 20,609 In April 2015, the Company completed plug and abandonment ("P&A") activities for well Oyo-6 that was previously shut-in. Actual P&A expenditures exceeded estimated P&A liabilities by approximately $3.7 million . Accordingly, the Company recorded a $3.7 million loss on settlement of asset retirement obligations during the year ended December 31, 2015 . Accretion expense is recognized as a component of depreciation, depletion and amortization expense in the accompanying consolidated statements of operations. The table below shows the current and long-term portions of the Company's asset retirement obligations as of the end of December 31, 2016 and 2015 : As of December 31, (In thousands) 2016 2015 Asset retirement obligations, current portion $ — $ — Asset retirement obligations, long-term portion 22,476 20,609 $ 22,476 $ 20,609 |
Debt
Debt | 12 Months Ended |
Dec. 31, 2016 | |
Debt Disclosure [Abstract] | |
Debt | DEBT Short-Term Debt: Short-Term Borrowing - TOTSA Advances In May 2016, the Company received $4.7 million as an advance under a prepayment agreement (the “May Advance”) with TOTSA Total Oil Trading SA ("TOTSA"). Interest accrued on the May Advance at the rate of the 60 -day LIBOR plus 5% per annum. Repayment of the May Advance was made from proceeds received from the June 2016 crude oil lifting. In August 2016, the Company received $6.0 million as an advance under a prepayment agreement with TOTSA (the “August Advance”). Interest accrued on the August Advance at the rate of the 60 -day LIBOR plus 5% per annum. Repayment of the August Advance was made from proceeds received from the August 2016 crude oil lifting. Short-Term Note Payable In June 2016, the Company borrowed approximately $0.5 million under a 30 -day Promissory Note agreement entered into with a Nigerian bank (the “2016 Short-Term Note”), and had a facility flat fee of 2.5% . The 2016 Short-Term Note was renewed for another 30 days in July 2016 at a flat fee facility rate of 2.5% , and was fully repaid in July 2016. Long-Term Debt- Term Loan Facility: Term Loan Facility In September 2014, the Company, through its wholly owned subsidiary EPNL, entered into the Term Loan Facility (as amended or modified, the “Term Loan Facility”) with Zenith for a five -year senior secured term loan providing initial borrowing capacity of up to $100.0 million . Of the total commitment provided, 90% of the Term Loan Facility is available in U.S. dollars, while the remaining 10% is available in Nigerian Naira. U.S. dollar borrowings under the Term Loan Facility currently bear interest at the rate of LIBOR plus 11.1% . The obligations under the Term Loan Facility include a legal charge over the OMLs and an assignment of proceeds from oil sales. The obligations of EPNL have been guaranteed by the Company and rank in priority with all its other obligations. Proceeds from the Term Loan Facility were used for the further expansion and development of the Oyo field in Nigeria. In June 2016, the Term Loan Facility was modified contingent upon the signing of a loan agreement, which was signed in August 2016. The modification put in place a twelve month moratorium on principal payments and extended the term of the Term Loan Facility until February 2021. Additionally, it reduced the funding requirement of the debt service reserve account (“DSRA”) to an amount equal to one quarter of interest until the price of oil exceeds $55 per barrel, at which time an amount equal to two quarters of interest will then be required. Upon executing the Term Loan Facility, the Company paid fees totaling $2.6 million . Upon modification of the Term Loan Facility, additional fees of $ 1.4 million were incurred. These fees were recorded as debt issuance cost and are being amortized over the life of the Term Loan Facility using the effective interest method. As of December 31, 2016 , $2.3 million of the debt issuance costs remained unamortized. Under the Term Loan Facility, the following events, among others, constitute events of default: EPNL failing to pay any amounts due within thirty days of the due date; bankruptcy, insolvency, liquidation or dissolution of EPNL; a material breach of the Term Loan Facility by EPNL that remains unremedied within thirty days of written notice by EPNL; or a representation or warranty of EPNL proves to have been incorrect or materially inaccurate when made. Upon any event of default, all outstanding principal and interest under any loans will become immediately due and payable. Further, Zenith has the right to review the terms and conditions of the Term Loan Facility. During the year ended December 31, 2016 , the Company made payments of $0.4 million and $5.6 million for the principal repayment of the Naira portion of the loan and for the U.S. dollar principal, respectively. As of December 31, 2016 , the Company recognized an unrealized foreign currency gain of $4.3 million on the Naira portion of the loan, reducing the balance under the Term Loan Facility to $87.1 million , net of debt discount. Of this amount, $74.4 million was classified as long-term and $12.6 million as short-term. Accrued interest for the Term Loan Facility was $3.1 million as of December 31, 2016 . Scheduled principal repayments on the outstanding balance on the Term Loan Facility are as follows ( in thousands ): Scheduled payments by year Principal 2017 $ 13,413 2018 19,673 2019 21,460 2020 27,265 2021 and thereafter 7,609 Total principal payments $ 89,420 Less: Unamortized debt issuance costs 2,347 Total Term Loan Facility, net $ 87,073 Long-Term Debt - Related Party: As of December 31, 2016 , the Company’s long-term related party debt was $129.8 million , consisting of $24.9 million owed under the 2011 Promissory Note, $50.0 million owed under the 2014 Convertible Subordinated Note, $48.5 million , net of discount, under the 2015 Convertible Note, and $6.4 million owed under the 2016 Promissory Note. Allied, a related party, is the holder of each of the 2011 Promissory Note, the 2014 Convertible Subordinated Note, and the 2015 Convertible Note (collectively the “Allied Notes”). Each of the Allied Notes contains certain default and cross-default provisions, including failure to pay interest and principal amounts when due, and default under other indebtedness. As of December 31, 2016 , the Company was not in compliance with the default provisions of the Allied Notes with respect to the payment of quarterly interest. Further, the risk of cross-default exists for each of the Allied Notes if the holder of the Term Loan Facility exercises its right to terminate the Term Loan Facility and accelerate its maturity. Allied agreed to waive its rights under all default provisions of each of the Allied Notes through April 2018. 2011 Promissory Note The Company has a $25.0 million borrowing facility under the 2011 Promissory Note with Allied. Interest accrues on the outstanding principal under the 2011 Promissory Note at a rate of the 30 -day LIBOR plus 2% per annum, payable quarterly. In March 2017, the Promissory Note was amended to extend the maturity date to April 2018 . As consideration for the extension, the 2011 Promissory Note became convertible, at the sole option of the holder, into shares of the Company’s common stock at a conversion price of $3.415 per share. The entire $25.0 million facility amount can be utilized for general corporate purposes. The stock of the Company’s subsidiary that holds the exploration licenses in The Gambia and Kenya were pledged as collateral to secure the 2011 Promissory Note, pursuant to an Equitable Share Mortgage arrangement. As of December 31, 2016 , the outstanding principal and accrued interest under the 2011 Promissory Note was $24.9 million and $1.6 million , respectively. 2014 Convertible Subordinated Note As partial consideration in connection with the February 2014 acquisition of the Allied Assets, the Company issued the $50.0 million 2014 Convertible Subordinated Note in favor of Allied. Interest on the 2014 Convertible Subordinated Note accrues at a rate per annum of one-month LIBOR plus 5% , payable quarterly in cash until the maturity of the 2014 Convertible Subordinated Note five years from the closing of the Allied Transaction. At the election of the holder, the 2014 Convertible Subordinated Note is convertible into shares of the Company’s common stock at an initial conversion price of $4.2984 per share, subject to anti-dilution adjustments. The 2014 Convertible Subordinated Note is subordinated to the Company’s existing and future senior indebtedness and is subject to acceleration upon an Event of Default (as defined in the 2014 Convertible Subordinated Note). The following events, among others, constitute an Event of Default under the 2014 Convertible Subordinated Note: the Company failing to pay interest within thirty days of the due date; the Company failing to pay principal when due; bankruptcy, insolvency, liquidation or dissolution of the Company; a material breach of the 2014 Convertible Subordinated Note agreement by the Company that remains unremedied within ten days of such material breach; or a representation or warranty of the Company proves to have been incorrect or materially inaccurate when made. Upon any event of default, all outstanding principal and interest under any loans will become immediately due and payable. As of December 31, 2016 , the Company owed $8.0 million in interest under the 2014 Convertible Subordinated Note. The Company may, at its option, prepay the 2014 Convertible Subordinated Note in whole or in part, at any time, without premium or penalty. Further, the 2014 Convertible Subordinated Note is subject to mandatory prepayment upon (i) the Company’s issuance of capital stock or incurrence of indebtedness, the proceeds of which the Company does not apply to repayment of senior indebtedness or (ii) any capital markets debt issuance to the extent the net proceeds of such issuance exceed $250.0 million . Allied may assign all or any part of its rights and obligations under the 2014 Convertible Subordinated Note to any person upon written notice to the Company. As of December 31, 2016 , the outstanding principal under the 2014 Convertible Subordinated Note was $50.0 million . 2015 Convertible Note In March 2015, the Company entered into a borrowing facility with Allied in the form of the 2015 Convertible Note, allowing the Company to borrow up to $50.0 million for general corporate purposes. In March 2017, the maturity date of the 2015 Convertible Note was extended to April 2018. Interest accrues at the rate of LIBOR plus 5% , and is payable quarterly. The 2015 Convertible Note is convertible into shares of the Company’s common stock upon the occurrence and continuation of an event of default, at the sole option of the holder. The number of shares issuable upon conversion is equal to the sum of the principal amount and the accrued and unpaid interest divided by the conversion price, defined as the volume weighted average of the closing sales prices on the NYSE MKT for a share of common stock for the five complete trading days immediately preceding the conversion date. As of December 31, 2016 , the Company had borrowed $48.5 million under the note and issued to Allied warrants to purchase approximately 2.7 million shares of the Company’s common stock at prices ranging from $2.00 to $7.85 per share. The total fair market value of the warrants amounting to $5.0 million based on the Black-Scholes option pricing model was recorded as a discount from the note, and is being amortized using the effective interest method over the life of the note. As of December 31, 2016 , the unamortized balance of the note discount was nil . Additional warrants are issuable in connection with future borrowings, with the per share price for those warrants determined based on the market price of the Company’s common stock at the time of such future borrowings. As of December 31, 2016 , the outstanding balance of the 2015 Convertible Note, net of discount, was $48.5 million . Accrued interest on the 2015 Convertible Note was $4.9 million as of December 31, 2016 . 2016 Promissory Note In March 2016, the Company borrowed $3.0 million under a short-term Promissory Note agreement entered into with an entity related to the Company's majority shareholder, which accrued interest at a rate of the 30 -day LIBOR plus 7% per annum. In April 2016, the Company borrowed an additional sum of $1.0 million from the same lender, under another short-term Promissory Note, which also accrued interest at a rate of the 30 -day LIBOR plus 7% per annum. In May 2016, the Lender of the two Promissory Notes agreed to combine both notes into a $10.0 million borrowing facility (the "2016 Promissory Note"). Interest accrues at a rate of the 30 -day LIBOR plus 7% per annum. Subsequent to the combination of both notes into the 2016 Promissory Note, the Company had additional drawings under the 2016 Promissory Note totaling $2.4 million . As of December 31, 2016 , the outstanding balance under the 2016 Promissory Note was $6.4 million . Accrued interest on the 2016 Promissory Note was $0.4 million as of December 31, 2016 . In March 2017, the maturity date of the 2016 Promissory Note was extended to April 2018. As consideration for the extension, the 2016 Promissory Note became convertible, at the sole option of the holder, into shares of the Company’s common stock at a conversion price of $3.415 per share. |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2016 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | RELATED PARTY TRANSACTIONS Assets and Liabilities The Company has transactions in the normal course of business with its shareholders, CEHL and their affiliates. The table below sets forth the related party assets and liabilities as of December 31, 2016 and 2015 : As of December 31, (In thousands) 2016 2015 Accounts receivable, CEHL $ 1,956 $ 1,186 Accounts payable and accrued liabilities, CEHL $ 29,513 $ 30,133 Long-term notes payable - related party, CEHL $ 129,796 $ 120,006 As of December 31, 2016 and 2015 , the related party receivable balances of $2.0 million and $1.2 million , respectively, were for advance payments made for certain transactions on behalf of affiliates. As of December 31, 2016 and 2015 , the Company owed $29.5 million and $30.1 million , respectively, to affiliates primarily for logistical and support services in relation to the Company's oilfield operations in Nigeria, as well as accrued interest on the various related party notes payable. As of December 31, 2016 and 2015 , accrued and unpaid interest on the various related party notes payable were $15.2 million and $8.3 million , respectively. As of December 31, 2016 , the Company had a combined note payable balance of $129.8 million owed to affiliates, consisting of $24.9 million in borrowings under the 2011 Promissory Note, $50.0 million in borrowings under the 2014 Convertible Subordinated Note, $48.5 million borrowing under the 2015 Convertible Note, net of discount, and $6.4 million under the 2016 Promissory Note. As of December 31, 2015 , the Company had a long-term note payable balance of $120.0 million owed to an affiliate, consisting of $25.0 million in borrowings under the 2011 Promissory Note, $50.0 million in borrowings under the 2014 Convertible Subordinated Note, and $45.0 million borrowing under the 2015 Convertible Note, net of discount. See Note 9. — Debt for further information relating to the notes payable transactions. Results from Operations The table below sets forth the transactions incurred with affiliates during the years ended December 31, 2016 , 2015 and 2014 : Year Ended December 31, (In thousands) 2016 2015 2014 Total operating expenses, CEHL $ 14,621 $ 15,106 $ 14,449 Interest expense, CEHL $ 6,843 $ 5,490 $ 2,414 Certain affiliates of the Company provide procurement and logistical support services to the Company’s operations. In connection therewith, during the years ended December 31, 2016 , 2015 and 2014, the Company incurred operating costs amounting to approximately $14.6 million , $15.1 million and $14.4 million , respectively. During the years ended December 31, 2016 , 2015 and 2014, the Company incurred interest expense, excluding debt discount amortization, totaling approximately $6.8 million , $5.5 million and $2.4 million , respectively, in relation to related party notes payable. Non-controlling Interests In April 2014, the Company, through its 50% ownership of its Erin Energy Ghana Limited subsidiary, signed a Petroleum Agreement with the Republic of Ghana relating to the Expanded Shallow Water Tano block offshore Ghana. An affiliate of the Company’s majority shareholder owns the remaining 50% non-controlling interest in the Erin Energy Ghana Limited subsidiary. See Note 4. — Acquisitions for further information. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | COMMITMENTS AND CONTINGENCIES Commitments The following table summarizes the Company’s significant future commitments on non-cancellable operating leases and estimated obligations arising from its minimum work obligations for the five years after December 31, 2016 and thereafter: Payments Due By Period (In thousands) Total 2017 2018 2019 2020 2021 Thereafter Operating lease obligations: FPSO and drilling rig leases - Nigeria $ 193,451 $ 48,363 $ 48,362 $ 48,363 $ 48,363 $ — $ — Office leases 1,600 537 493 450 81 39 — Minimum work obligations: Kenya 65,133 65,133 — — — — — The Gambia 1,200 600 600 — — — — Ghana 10,650 10,650 — — — — — Total $ 272,034 $ 125,283 $ 49,455 $ 48,813 $ 48,444 $ 39 $ — In February 2014, a long-term contract was signed for the floating, production, storage, and offloading vessel (“FPSO”) Armada Perdana , which is the vessel currently connected to the Company’s productive wells, Oyo-7 and Oyo-8, offshore Nigeria. The contract provides for an initial term of seven years beginning January 1, 2014, with an automatic extension for an additional term of two years unless terminated by the Company with prior notice. The FPSO can process up to 40,000 barrels of liquid per day, with a storage capacity of approximately one million barrels. In June 2015, the operator of the FPSO agreed to a price reduction for the operating day rates incurred by the Company for the period from July 2014 to April 2015. This resulted in a $26.0 million reduction in previously accrued production costs. The remaining annual minimum commitment per the terms of the agreement is approximately $48.4 million per year through 2020. The Company also has commitments related to four production sharing contracts with the Government of the Republic of Kenya (the “Kenya PSCs”), two Petroleum Exploration, Development & Production Licenses with the Republic of The Gambia (the “Gambia Licenses”), and one Petroleum Agreement with the Republic of Ghana. In all cases, the Company entered into these commitments through a subsidiary. To maintain compliance and ownership, the Company is required to fulfill certain minimum work obligations and to make certain payments as stated in each of the Kenya PSCs, the Gambia Licenses, and the Ghana Petroleum Agreement. The table above sets forth the Company's future contractual obligations with regards to the minimum work obligations in each country. In December 2016, the Company recorded a charge of $0.6 million to write-off the carrying value of certain of its offshore leases in Kenya because the Company no longer intends to renew or extend its leases on these offshore blocks. The Company rents office space and miscellaneous office equipment under non-cancelable operating leases. Office rent expense, net of sublease income, for the years ended December 31, 2016 , 2015 and 2014 , was $1.1 million , $0.9 million and $1.0 million , respectively. At December 31, 2016 , minimum future rental commitments for office leases were a total of $1.6 million . Contingencies Legal Contingencies and Proceedings From time to time, the Company may be involved in various legal proceedings and claims in the ordinary course of business. As of December 31, 2016 , and through the filing date of this report, the Company does not believe the ultimate resolution of such actions or potential actions of which the Company is currently aware will have a material effect on its consolidated financial position or results of operations. On January 22, 2016, a request for arbitration was filed with the London Court of International Arbitration by Transocean Offshore Gulf of Guinea VII Limited and Indigo Drilling Limited, as Claimants, against the Company and its Nigerian subsidiary, EPNL, as Respondents (the “Arbitration”). The Arbitration is in relation to a drilling contract entered into by the Claimants and EPNL, and a parent company guarantee provided by the Company in relation thereto. The Claimants are seeking an order that the Respondents pay the sum of approximately $20.2 million together with interest and costs. The Company filed its Statement of Defense on October 4, 2016. The London Court of International Arbitration has set the arbitration hearing to begin on October 3, 2017 with a possible earlier hearing start date, subject to availability. On February 5, 2016, a class action and derivative complaint was filed in the Delaware Chancery Court purportedly on behalf of the Company and on behalf of a putative class of persons who were stockholders as of the date the Company (1) acquired the Allied Assets pursuant to the Transfer Agreement and (2) issued shares to the PIC in a private placement (collectively the “February 2014 Transactions”). The complaint alleges the February 2014 Transactions were unfair to the Company and purports to assert derivative claims against (1) the seven individuals who served on our Board at the time of the February 2014 Transactions and (2) the Company's majority shareholder, CEHL. The complaint also purports to assert a direct breach of fiduciary duty claim on behalf of the putative class against the seven individuals who served on our Board at the time of the February 2014 Transactions on the grounds that they purportedly caused the Company to disseminate a false and misleading proxy statement in connection with the 2014 Transactions, and a direct claim for aiding and abetting against Dr. Kase Lawal, the former Executive Chairman of the Board of Directors and Chief Executive Officer of the Company. The plaintiff is seeking, on behalf of the Company and the putative class, an undisclosed amount of compensatory damages. The Company is named solely as a nominal defendant against whom the plaintiff seeks no recovery. On March 3, 2016, all of the defendants, including the Company, filed motions to dismiss the complaint, which motions were heard on January 18, 2017. On May 13, 2016, CEONA Contracting (UK) Limited ("Ceona") initiated arbitration proceedings against the Company for $2.9 million , together with costs, expenses and interest, for work done in relation to the Company's ordinary course of business. On August 22, 2016, the parties entered into a settlement agreement, and as a result thereof, the Company decreased its accounts payable and accrued liabilities by $2.7 million with a corresponding decrease to its oil and gas properties as of December 31, 2016 . Also as part of the settlement agreement, the Company paid $1.1 million to Ceona on August 31, 2016. On July 29, 2016, a judgment was entered against the Company in the amount of $2.4 million , including interest, in relation to amounts due to a contractor (Polarcus MC Ltd.) in the ordinary course of business. A further sum of $0.4 million was payable under the relevant contract, and the contractor has made a further claim, which is disputed by the Company, for an additional $0.3 million plus legal costs. Under a further court order dated September 9, 2016, further proceedings in respect of the matter have been stayed pending fulfillment of certain settlement terms. As of the date of this report, the judgment debt has been completely satisfied, with all remaining sums claimed by this contractor discharged in January 2017. Unrecognized Loss Contingency As of December 31, 2016 , the Company has not accrued penalty and interest related to certain outstanding transactional tax obligations in Nigeria, including withholding taxes, value-added taxes, Nigerian Oil and Gas Industry Content Development Act (NCD) tax, Cabotage taxes, and Niger Delta Development Corporation taxes (NDDC). As of the date of this report, the Company believes that, based on its experience with local practices in Nigeria, the likelihood of being assessed penalty and interest is reasonably possible, with an estimated liability up to $17.1 million . Contingency under the Allied Transfer Agreement As provided for under the Transfer Agreement with Allied, the Company is required to make the following additional payments upon the occurrence of certain future events: (i) $25.0 million cash or the equivalent in shares of the Company’s common stock, within fifteen days following the approval of a development plan by the Nigerian Department of Petroleum Resources ("DPR") with respect to a first new discovery of hydrocarbons in a non-Oyo field area; and (ii) $25.0 million cash or the equivalent in shares of the Company’s common stock within fifteen days starting from the commencement of the first hydrocarbon production in commercial quantities in a non-Oyo field area. The number of shares to be issued shall be determined by calculating the average closing price of the Company’s common stock over a period of thirty days , counted back from the first business day immediately prior to the approval of a development plan by DPR or the date of the first hydrocarbon production in commercial quantities, as applicable. Contingency under the 2015 Convertible Note As part of the condition to the extension of the maturity date of the 2015 Convertible Note entered into in March 2016, the Company is required to (i) pay to Allied an amount equal to ten percent ( 10% ) of any successful debt fundraising event completed during the remaining term of the 2015 Convertible Note; and (ii) pay to Allied an amount equal to twenty percent ( 20% ) of any successful equity fundraising event completed during the remaining term of the 2015 Convertible Note. |
Stock Based Compensation
Stock Based Compensation | 12 Months Ended |
Dec. 31, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock Based Compensation | STOCK BASED COMPENSATION Under the Company’s amended 2009 Equity Incentive Plan (“2009 Plan”), the Company may issue restricted stock awards and stock options to result in issuance of a maximum aggregate of 16.7 million shares of common stock. Options awarded expire between five and ten years from the date of the grant, or a shorter term as fixed by the Board of Directors. Stock Options The table below sets forth a summary of stock option activity for the year ended December 31, 2016 . Shares Underlying Options (In Thousands) Weighted-Average Exercise Price Weighted-Average Remaining Contractual Term (Years) Stock Options Outstanding at December 31, 2015 2,532 $2.29 1.6 Granted — $— — Exercised (1,200 ) $1.84 — Forfeited (27 ) $3.42 — Expired (158 ) $3.70 — Outstanding at December 31, 2016 1,147 $2.54 2.0 Expected to vest 908 $2.21 1.6 Exercisable at December 31, 2016 239 $3.79 3.4 During the year ended December 31, 2016 , the Company issued 437,638 shares of common stock as a result of the exercise of stock options, of which 246,838 shares of common stock were issued as a result of the cashless exercise of 1,008,803 options. Also, during the year ended December 31, 2016 , options to purchase 157,768 shares of common stock expired, and options to purchase 27,052 shares were forfeited. The total intrinsic value of options outstanding and options exercisable were $0.9 million and $0.9 million , respectively, at December 31, 2016 . The total intrinsic values realized by recipients on options exercised were $0.7 million , $0.01 million , and $0.9 million in 2016 , 2015 and 2014 , respectively. The Company recorded compensation expense relative to stock options in 2016 , 2015 and 2014 of $0.4 million , $1.3 million and $1.3 million , respectively. As of December 31, 2016 , there were approximately $0.3 million of total unrecognized compensation cost related to stock options, with $0.2 million and $0.1 million to be recognized during the years ended December 31, 2017 and 2018, respectively. The fair values of stock options used in recording compensation expense are computed using the Black-Scholes option pricing model. The table below shows the weighted-average amounts and the assumptions used in the model for options awarded in each year under equity incentive plans. 2016 2015 2014 Expected price volatility —% 77.1% - 83.1% 87.7 % Risk free interest rate (U.S. treasury bonds) —% 1.0 to 1.2 % 1.1 % Expected annual dividend yield — — — Expected option term (years) — 3.0 3.0 Weighted-average grant date fair value per share — $ 2.73 $ 1.92 Stock Warrants The table below sets forth a summary of stock warrant activity for the year ended December 31, 2016 . Shares Underlying Warrants (In Thousands) Weighted-Average Exercise Price Weighted-Average Remaining Contractual Term (Years) Stock warrants Outstanding at December 31, 2015 2,935 $3.61 4.2 Granted 48 $2.07 4.3 Exercised — $— — Forfeited — $— — Expired — $— — Outstanding at December 31, 2016 2,983 $3.59 3.2 Expected to vest — $— — Exercisable at December 31, 2016 2,983 $3.59 3.2 The total intrinsic value of warrants outstanding and exercisable was $1.0 million at December 31, 2016 . During the year ended December 31, 2016 , and in connection with the execution of the 2015 Convertible Note, the Company issued to Allied warrants to purchase 48,291 shares of the Company’s common stock at exercise prices ranging from $2.00 to $2.13 per share. The warrants are exercisable at any time starting from the date of issuance and have a five -year term. See Note 9 – Debt - 2015 Convertible Note . During the year ended December 31, 2014 , as compensation for services received, the Company issued warrants to a service provider to purchase 0.3 million shares of common stock at an exercise price of approximately $3.36 per share. The warrants are exercisable at any time starting from the date of issuance and have a five year term. During the years ended December 31, 2016, 2015 and 2014, the Company recognized stock-based compensation expense of nil , $0.4 million and $0.1 million , respectively, related to these warrants, based on the Black-Scholes option pricing model. The table below shows the weighted-average amounts and the assumptions used in the model for warrants issued during each year. 2016 2015 2014 Expected price volatility 84.7% - 84.8% 76.8% - 83.2% 82.7 % Risk free interest rate (U.S. treasury bonds) 0.8 % 0.8% - 1.1% 1.1 % Expected annual dividend yield — — — Expected option term (years) 3.0 3.0 3.0 Weighted-average grant date fair value per share $ 1.12 $ 1.86 $ 1.80 Restricted Stock Awards (“RSA”) In addition to stock options, the Company’s 2009 Plan allows for the grant of restricted stock awards (“RSAs”). The Company determines the fair value of RSAs based on the market price of its common stock on the date of grant. Compensation cost for RSAs is recognized on a straight-line basis over the vesting or service period and is net of forfeitures. The table below sets forth a summary of RSA activity for the year ended December 31, 2016 . Shares (In Thousands) Weighted-Average Grant Date Fair Value Restricted Stock Non-vested at December 31, 2015 1,114 $3.21 Granted 1,716 $2.16 Vested (669 ) $3.56 Forfeited (89 ) $2.59 Non-vested as of December 31, 2016 2,072 $2.25 During the year ended December 31, 2016 , the Company granted its officers, directors, and employees a total of approximately 1.7 million shares of restricted common stock, including 0.5 million shares of performance-based restricted stock awards ("PBRSAs") to certain officers with vesting periods varying from immediate vesting to 36 months . During the year ended December 31, 2016 , 89,461 shares of restricted common stock were forfeited. With regards to the PBRSA, each grant will vest if the individuals remain employed three years from the date of grant and the Company achieves specific performance objectives at the end of the designated performance period. Up to 50% additional shares may be awarded if performance objectives are exceeded. None of the PBRSAs will vest if certain minimum performance goals are not met. The performance conditions are based on the Company’s total shareholder return over the performance period compared to an industry peer group of companies. Total estimated compensation expense, net of forfeitures, is $0.3 million over three years . The Company recorded compensation expense relative to RSAs, including PBRSAs, in 2016 , 2015 and 2014 of $2.5 million , $3.3 million and $1.7 million , respectively. The total grant date fair value of RSA shares that vested during 2016 and 2015 was approximately $2.1 million and $3.1 million , respectively. As of December 31, 2016 , there were approximately $1.7 million of total unrecognized compensation cost related to non-vested RSAs, with $1.5 million and $0.2 million to be recognized during the years ended December 31, 2017 and 2018, respectively. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | INCOME TAXES Following is a reconciliation of the expected statutory U.S. Federal income tax provision to the actual income tax expense for the respective periods: Years Ended December 31, (In thousands) 2016 2015 2014 Net loss attributable to Erin Energy Corporation before income tax expense $ (142,401 ) $ (430,937 ) $ (96,062 ) Expected income tax provision at statutory rate of 35% (49,840 ) (150,828 ) (33,622 ) Increase (decrease) due to: Foreign rate differential (17,202 ) (59,467 ) (10,083 ) Change in valuation allowance 71,148 256,910 98,376 Investment tax credit - Nigeria 1,991 (35,580 ) (40,765 ) Non-deductible expenses and other (6,097 ) (11,035 ) (13,906 ) Total income tax expense $ — $ — $ — Significant components of our deferred tax assets are as follows: As of December 31, (In thousands) 2016 2015 Basis difference in fixed assets $ (3,249 ) $ 11,893 Unused capital allowances 572,051 506,795 Net operating losses 109,230 88,391 Other 12,421 12,226 690,453 619,305 Valuation allowance (690,453 ) (619,305 ) Net deferred income tax assets $ — $ — The majority of the Company’s basis difference in fixed assets and unused capital allowances were generated from its Nigerian operations. The Company’s foreign net operating losses in Nigeria are not subject to expiration, and can be carried forward indefinitely. The foreign operating losses in The Gambia, Kenya and Ghana are included in the respective subsidiaries cost oil accounts, which will be offset against future taxable revenues. Management assesses the available positive and negative evidence to estimate if existing deferred tax assets will be utilized. Based on current facts and circumstances related to its Nigerian operations, management has determined that it cannot demonstrate that it is more likely than not that the Nigerian losses and unutilized capital allowances will be utilized to reduce the Company’s petroleum profit tax liability within the foreseeable future. Furthermore, because the Company does not currently have any revenue generating activities either in the U.S. or in any of its non-Nigerian subsidiaries, it cannot demonstrate that it is more likely than not that any of the related deferred tax assets will be utilized in the foreseeable future. On the basis of this assessment, valuation allowances of $690.5 million and $619.3 million were recorded as of December 31, 2016 and 2015 , respectively. At December 31, 2016 and 2015 , the Company was subject to foreign and United States federal taxes only, with no allocations made to state and local taxes. The following table summarizes the tax years that remain subject to examination by major tax jurisdictions: United States: 2007 - 2016 Nigeria: 2010 - 2016 Kenya: 2012 - 2016 The Gambia: 2012 - 2016 |
Segment Information
Segment Information | 12 Months Ended |
Dec. 31, 2016 | |
Segment Reporting [Abstract] | |
Segment Information | SEGMENT INFORMATION The Company’s current operations are based in Nigeria, Kenya, The Gambia, and Ghana. Management reviews and evaluates the operations of each geographic segment separately. Segments include exploration for and production of hydrocarbons where commercial reserves have been found and developed. Revenues and expenditures are recognized at the relevant geographical location. The Company evaluates each segment based on operating income (loss). The table below sets forth segment activity for the years ended December 31, 2016 , 2015 , and 2014 . (In thousands) Nigeria Kenya The Gambia Ghana Corporate and Other Total For the Years Ended December 31, 2016 Revenues $ 77,815 $ — $ — $ — $ — $ 77,815 Operating loss $ (119,346 ) $ (2,569 ) $ (1,570 ) $ (1,677 ) $ (11,830 ) $ (136,992 ) 2015 Revenues $ 68,429 $ — $ — $ — $ — $ 68,429 Operating loss $ (387,448 ) $ (8,038 ) $ (5,209 ) $ (1,931 ) $ (13,807 ) $ (416,433 ) 2014 Revenues $ 53,844 $ — $ — $ — $ — $ 53,844 Operating loss $ (64,716 ) $ (12,130 ) $ (1,347 ) $ (492 ) $ (14,640 ) $ (93,325 ) The table below sets forth the total assets by segment as of December 31, 2016 and 2015 . (In thousands) Nigeria Kenya The Gambia Ghana Corporate and Other Total Total Assets December 31, 2016 $ 281,050 $ 698 $ 3,034 $ 3,648 $ 771 $ 289,201 December 31, 2015 $ 387,326 $ 1,399 $ 3,016 $ 2,447 $ 971 $ 395,159 |
Selected Unaudited Quarterly Fi
Selected Unaudited Quarterly Financial Data | 12 Months Ended |
Dec. 31, 2016 | |
Quarterly Financial Information Disclosure [Abstract] | |
Selected Unaudited Quarterly Financial Data | SELECTED UNAUDITED QUARTERLY FINANCIAL DATA (In thousands, except for per share amounts) Three Months Ended, March 31, 2016 June 30, 2016 September 30, 2016 December 31, 2016 Total revenues $ 4,929 $ 23,151 $ 28,619 $ 21,116 Operating loss $ (28,293 ) $ (27,199 ) $ (21,817 ) $ (59,683 ) Net loss attributable to Erin Energy Corporation $ (32,411 ) $ (22,572 ) $ (23,471 ) $ (63,947 ) Net loss per common share attributable to Erin Energy Corporation Basic $ (0.15 ) $ (0.11 ) $ (0.11 ) $ (0.30 ) Diluted $ (0.15 ) $ (0.11 ) $ (0.11 ) $ (0.30 ) Three Months Ended, March 31, 2015 June 30, 2015 September 30, 2015 December 31, 2015 Total revenues $ — $ — $ 28,667 $ 39,762 Operating loss $ (32,031 ) $ (5,821 ) $ (53,423 ) $ (325,158 ) Net loss attributable to Erin Energy Corporation $ (33,059 ) $ (9,162 ) $ (58,682 ) $ (330,034 ) Net loss per common share attributable to Erin Energy Corporation Basic $ (0.16 ) $ (0.04 ) $ (0.28 ) $ (1.56 ) Diluted $ (0.16 ) $ (0.04 ) $ (0.28 ) $ (1.56 ) |
Correction of Immaterial Error
Correction of Immaterial Error in Previously Issued Consolidated Financial Statements | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Changes and Error Corrections [Abstract] | |
Correction of Immaterial Error in Previously Issued Consolidated Financial Statements | CORRECTION OF IMMATERIAL ERROR IN PREVIOUSLY ISSUED CONSOLIDATED FINANCIAL STATEMENTS Prior to the filing of the Company's September 30, 2016 Form 10-Q, the management of the Company determined that the impairment calculation of its oil and gas properties as of December 31, 2015 did not exclude estimated future cash flows related to future abandonment costs. As a result, the Company is revising certain of its consolidated financial statements as of and for the year ended December 31, 2015 to correct this error. This prior year error correction did not change the net cash flows provided by or used in operating, investing or financing activities previously reported. The effect of this correction on capital deficiency as of December 31, 2015 was a reduction of $20.6 million , as reflected in the Statement of Changes in Capital Deficiency as of December 31, 2015. After considering Staff Accounting Bulletin No. 99, Assessing Materiality , management does not deem this revision to be material to its consolidated financial statements due to its consideration of the amount and direction of the error and its impact on the quality of key oil and natural gas industry financial metrics. As a result of the correction, the originally reported net loss for the year ended December 31, 2015 was decreased by $20.6 million , and originally reported basic and diluted loss per share for the year ended December 31, 2015 was decreased by $0.09 per share. The following table reflects the amounts within the consolidated balance sheet, statement of operations, and statement of cash flows as originally reported to amounts as now reflected as of and for the year ended December 31, 2015. (In thousands) December 31, 2015 As Originally Reported Adjustments Corrected Consolidated Balance Sheet Oil and gas properties, net $ 348,331 $ 20,560 $ 368,891 Total property, plant and equipment, net $ 349,505 $ 20,560 $ 370,065 Accumulated deficit $ (896,451 ) $ 20,560 $ (875,891 ) Total capital deficiency $ (105,827 ) $ 20,560 $ (85,267 ) Consolidated Statement of Operations - for the year ended Impairment of oil and gas properties $ 281,768 $ (20,560 ) $ 261,208 Total operating costs and expenses $ 505,422 $ (20,560 ) $ 484,862 Net loss $ (451,497 ) $ 20,560 $ (430,937 ) Basic and diluted loss per share attributable to Erin Energy Corporation $ (2.13 ) $ 0.09 $ (2.04 ) Consolidated Statement of Cash Flows - for the year ended Net loss, including non-controlling interest $ (452,459 ) $ 20,560 $ (431,899 ) Impairment of oil and gas properties $ 281,768 $ (20,560 ) $ 261,208 |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2016 | |
Subsequent Events [Abstract] | |
Subsequent Events | SUBSEQUENT EVENTS Subsequent to December 31, 2016, the Company issued 31,841 shares of common stock upon the cashless exercise of stock options. Subsequent to December 31, 2016, the Company granted to employees approximately 0.4 million shares of restricted stock, and granted performance-based restricted stock awards (PBRSA) to certain officers totaling 0.2 million shares. In February 2017, the Company received $13.6 million as an advance (the “February Advance”) under a stand-alone spot oil sales contract with Glencore Energy UK Ltd. ("Glencore"). Interest accrued on the February Advance at the rate of LIBOR plus 6.5% . Repayment of the February Advance was made from the February 2017 crude oil lifting. MCB Finance Facility and Related Agreements On February 6, 2017, the Company and its subsidiary, EPNL, entered into a Pre-export Finance Facility Agreement (the “MCB Finance Facility”) with The Mauritius Commercial Bank Limited, as mandated lead arranger, agent, security agent, original lender and issuing bank ( “MCB”). The MCB Finance Facility provides for a total commitment of $100.0 million and is supported by a guarantee from The Standard Bank of South Africa Limited (“SBSA”), as named guarantor, which guarantee is facilitated by the South African Public Investment Corporation (SOC) Limited ("PIC"), the Company’s second largest shareholder. The PIC guarantee is made with recourse to the Company pursuant to the Company’s entry into the Financing Support Agreement with PIC (the "Financing Support Agreement"). In connection with the MCB Finance Facility, and as a condition precedent to the initial drawdown thereunder, EPNL entered into an exclusive off-take contract with Glencore dated January 18, 2017 (the “Off-take Contract”) for EPNL’s entire volumes of oil produced from the OMLs located offshore Nigeria. Pursuant to the MCB Finance Facility, EPNL is required to comply with the terms of the Off-take Contract, ensure payments and deliveries of oil and notify MCB of any failures under such contract and ensure that it receives a fair market price for delivered oil. The MCB Finance Facility is supported by the SBSA guarantee as facilitated by PIC, the assignment of the Off-take Contract and the assignment by way of security of certain accounts, including a debt service reserve account, as set forth in the MCB Finance Facility. EPNL is required to deposit $10.0 million at the closing of the MCB Finance Facility into the debt service reserve account with MCB and maintain that balance for so long as borrowings are outstanding under the MCB Finance Facility. The aforementioned guarantee and security agreements must be entered into by the parties thereto as conditions precedent to the initial drawdown on the MCB Finance Facility. EPNL may make drawdowns under the MCB Finance Facility by way of loans and/or letters of credit until June 30, 2017 after which the remaining balance of MCB's commitment may be deposited into a capital expenditure reserve account for payment of invoices expected to be payable within six months after June 30, 2017. Borrowings under the MCB Finance Facility bear interest at three-month LIBOR plus a 6% margin. After a grace period that ends on June 30, 2017, the MCB Finance Facility will be repaid over a period starting from June 30, 2017 and ending on December 31, 2019. The MCB Finance Facility includes customary fees, including a commitment fee, structuring fee, underwriting fee, management fee, fees payable in respect of utilization of the MCB Finance Facility by way of letter of credit and other fees, and subjects EPNL to certain covenants under the terms of the MCB Finance Facility, and is subject to conditions to closing as is customary with such facilities and customary events of default. Also on February 6, 2017, the Company and PIC also entered into the Financing Support Agreement. Pursuant to the Financing Support Agreement, PIC agrees to apply for, request and authorize SBSA, or any other reputable commercial bank acceptable to MCB, to issue a bank guarantee in favor of MCB in the amount of $100.0 million . The issuance of a guarantee in favor of MCB by SBSA or another reputable commercial bank is a condition precedent to the closing of the MCB Finance Facility. In consideration for this undertaking, the Company has agreed to pay PIC an upfront fee equal to 250 basis points on the guarantee amount and issue to PIC warrants to purchase a number of shares of the Company’s common stock in an amount equal to the guarantee amount multiplied by 20% divided by the closing market price of the Company’s common stock on the day that EPNL receives funds under the MCB Finance Facility, with an exercise price equal to such closing market price. The Company also has agreed to indemnify PIC from and against certain claims and losses. The amount of any and all indemnifiable losses suffered by PIC agreed or otherwise required to be paid by the Company will be paid in cash or, at the option of PIC, may be paid in newly issued shares of the Company’s common stock. On February 8, 2017, and in connection with the MCB Finance Facility, the Company, EPNL, MCB and Zenith, the Company’s existing secured lender, also entered into an Override Deed (the “Override Deed”). The Override Deed establishes, inter alia, pro-rata rights of MCB and Zenith in respect of the proceeds from the Off-take Contract, governs the mechanics of any enforcement action by the creditors and sets out pro-rata sharing of enforcement proceeds between MCB and Zenith. The Override Deed also grants the necessary consents to EPNL’s entry into the MCB Finance Facility and related documents. Execution of Drilling Rig Contract In March 2017, the Company entered into a drilling services contract with Pacific Drilling using the Pacific Bora drilling rig. The Company plans to use this rig to drill well Oyo-9 on the Oyo field in the deepwater offshore Nigeria. Under the contract, the Company has the option to drill up to two additional wells. The option to extend the contract, if exercised, would be used to drill two of its offshore Nigeria exploration prospects in the prolific Miocene geological zone. The Pacific Bora is a highly efficient sixth generation double-hulled drillship currently in Nigeria and expected to be mobilized to the Oyo field and on site in June 2017. The contract provides for a base operating rate of $195,000 per day. The rig can be used for both drilling and well completion. |
Basis of Presentation and Sig25
Basis of Presentation and Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying consolidated financial statements include the accounts of the Company and its wholly-owned and majority-owned direct and indirect subsidiaries, and have been prepared in accordance with generally accepted accounting principles in the United States (“U.S. GAAP”) pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). All significant intercompany transactions and balances have been eliminated in consolidation. The consolidated financial statements reflect all adjustments that are, in the opinion of management, necessary for a fair presentation of the consolidated financial position and results of operations for the indicated periods. All such adjustments are of a normal recurring nature. In February 2014, the Company completed the acquisition of the remaining economic interests that it did not already own in the Production Sharing Contract covering Oil Mining Leases 120 and 121 located offshore Nigeria (the “OMLs”), which include the currently producing Oyo field (the “Allied Assets”), from Allied (the “Allied Transaction”). Pursuant to the terms of the Transfer Agreement entered into with Allied, the Company issued approximately 82.9 million shares of common stock to Allied, as partial consideration for the Allied Assets. Allied is a subsidiary of CEHL, the Company’s majority shareholder, and deemed to be under common control. Accordingly, the net assets acquired from Allied were recorded at their respective carrying values as of the acquisition date. The shares issued to Allied and the financial statements presented for all periods included herein are presented as though the transfer of the Allied Assets had occurred in June 2012, the effective date when Allied acquired the Allied Assets from an independent third party. See Note 4. — Acquisitions for further information. Effective April 22, 2015 , the Company implemented a reverse stock split, whereby each six shares of outstanding common stock pre-split was converted into one share of common stock post-split (the “reverse stock split”). All share and per share amounts for all periods presented herein have been adjusted to reflect the reverse stock split as if it had occurred at the beginning of the first period presented. |
Principles of Consolidation | Principles of Consolidation The consolidated financial statements include the accounts and activities of the Company, subsidiaries in which the Company has a controlling financial interest, and entities for which the Company is the primary beneficiary. All material intercompany accounts and transactions have been eliminated in consolidation. |
Use of Estimates | Use of Estimates The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates based on assumptions. Estimates affect the reported amounts of assets and liabilities, disclosure of contingent liabilities, and the reported amounts of revenues and expenses during the reporting periods. Accordingly, accounting estimates require the exercise of judgment. While management believes that the estimates and assumptions used in the preparation of the Company’s consolidated financial statements are appropriate, actual results could differ from those estimates. Estimates that may have a significant effect on the Company’s financial position and results from operations include share-based compensation assumptions, oil and natural gas reserve quantities, impairment of oil and gas properties, depletion and amortization relating to oil and gas properties, asset retirement obligation assumptions, and income taxes. The accounting estimates used in the preparation of the consolidated financial statements may change as new events occur, more experience is acquired, additional information is obtained and our operating environment changes. |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash and cash equivalents include cash on hand, demand deposits and short-term investments with initial maturities of three months or less. |
Restricted Cash | Restricted Cash Restricted cash consists of cash deposits that are contractually restricted for withdrawal or required to be maintained in a reserve bank account for a specific period of time, as provided for under certain agreements with third parties. |
Accounts Receivable and Allowance for Doubtful Accounts | Accounts Receivable and Allowance for Doubtful Accounts Accounts receivable are accounted for at cost less allowance for doubtful accounts. The Company establishes provisions for losses on accounts receivable if it is determined that collection of all or a part of an outstanding balance is not probable. Collectability is reviewed regularly and an allowance is established or adjusted, as necessary, using the specific identification method. As of December 31, 2016 and 2015 , no allowance for doubtful accounts was necessary. |
Crude Oil Inventory | Crude Oil Inventory Inventories of crude oil are valued at the lower of cost or market using the first-in, first-out method and include certain costs directly related to the production process and depletion, depreciation and amortization attributable to the underlying oil and gas properties. |
Successful Efforts Method of Accounting for Oil and Gas Activities | Successful Efforts Method of Accounting for Oil and Gas Activities The Company follows the successful efforts method of accounting for its costs of acquisition, exploration and development of oil and gas properties. Under this method, oil and gas lease acquisition costs and intangible drilling costs associated with exploration efforts that result in the discovery of proved reserves and costs associated with development drilling, whether or not successful, are capitalized when incurred. Drilling costs of exploratory wells are capitalized pending determination that proved reserves have been found. If the determination is dependent upon the results of planned additional wells and require additional capital expenditures to develop the reserves, the drilling costs will be capitalized as long as sufficient reserves have been found to justify completion of the exploratory well as a producing well, and additional wells are underway or firmly planned to complete the evaluation of the well. Exploratory wells not meeting the criteria for continued capitalization are expensed when such a determination is made. Other exploration costs are expensed as incurred. A portion of the Company’s oil and gas properties include oilfield materials and supplies inventory to be used in connection with the Company’s drilling program. These inventories are stated at the lower of cost or market, which approximates fair value, and they are regularly assessed for obsolescence. Oilfield materials and supplies inventory balances were $34.7 million and $30.0 million at December 31, 2016 and 2015 , respectively. Depreciation, depletion and amortization costs for productive oil and gas properties are recorded on a unit-of-production basis. For other depreciable property, depreciation is recorded on a straight-line basis over the estimated useful life of the assets, which range between three to five years , or the lease term if shorter. Repairs and maintenance charges, including workover costs, are charged to expense as incurred. |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets The Company reviews its long-lived assets in property, plant and equipment for impairment each reporting period, or whenever changes in circumstances indicate that the carrying amount of assets may not be fully recoverable. Possible indicators of impairment include lower expected future oil and gas prices, actual or expected future development or operating costs significantly higher than previously anticipated, significant downward oil and gas reserve revisions, or when changes in other circumstances indicate the carrying amount of an asset may not be recoverable. An impairment loss is recognized for proved properties when the estimated undiscounted future cash flows expected to result from the asset are less than its carrying amount. The Company estimates the future undiscounted cash flows of the affected properties to judge the recoverability of carrying amounts. Cash flows are determined on the basis of reasonable and documented assumptions that represent the best estimate of the future economic conditions during the remaining useful life of the asset. The Company’s cash flow projections into the future include assumptions on variables, such as future sales, sales prices, operating costs, economic conditions, market competition and inflation. Prices used to quantify the expected future cash flows are estimated based on forward prices prevailing in the marketplace and management’s long-term planning assumptions. Impairment is measured by the excess of carrying amount over the fair value of the assets. Unevaluated leasehold costs are assessed for impairment at the end of each reporting period and transferred to proved oil and gas properties to the extent they are associated with successful exploration activities. Significant unevaluated leasehold costs are assessed individually for impairment, based on the Company’s current exploration plans, and any indicated impairment is charged to expense. |
Asset Retirement Obligations | Asset Retirement Obligations The Company accounts for asset retirement obligations in accordance with applicable accounting guidelines , which require that the fair value of a liability for an asset retirement obligation be recognized in the period in which it is incurred. Specifically, the Company records a liability for the present value, using a credit-adjusted risk free interest rate, of the estimated site restoration costs with a corresponding increase to the carrying amount of the related long-lived asset. |
Revenues | Revenues Revenues are recognized when crude oil is delivered to a buyer. The recognition criteria are satisfied when there exists a signed contract with defined pricing, delivery, and acceptance, and there is no significant uncertainty of collectability. Crude oil revenues are recorded net of royalties. |
Income Taxes | Income Taxes The Company accounts for income taxes using the asset and liability method of accounting for income taxes in accordance with applicable accounting rules. Under the asset and liability method, deferred tax assets and liabilities are recognized for temporary differences between the tax bases of assets and liabilities and their carrying values for financial reporting purposes and for operating loss and tax credit carry-forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance is established to reduce deferred tax assets to their net realizable amounts if it is more likely than not that the related tax benefits will not be fully realized. The Company routinely evaluates any tax deduction and tax refund position in a two-step process. The first step is to determine whether it is more likely than not that a tax position will be sustained. If that test is met, the second step is to determine the amount of benefit or expense to recognize in the consolidated financial statements. See Note 13. — Income Taxes for further information. |
Debt Issuance Costs | Debt Issuance Costs Debt issuance costs consist of certain costs paid to lenders in the process of securing a borrowing facility. Debt issuance costs incurred are capitalized and subsequently charged to interest expense over the term of the related debt, using the effective interest rate method. |
Capitalized Interest | Capitalized Interest The Company capitalizes interest costs for qualifying oil and gas properties. The capitalization period begins when expenditures are incurred on qualified properties, activities begin which are necessary to prepare the property for production, and interest costs have been incurred. The capitalization period continues as long as these events occur. Capitalized interest is added to the cost of the underlying assets and is depleted using the unit-of-production method in the same manner as the underlying assets. |
Share-Based Compensation | . Stock-Based Compensation The Company recognizes all stock-based payments to employees, including grants of employee stock options, in the consolidated financial statements based on their grant-date fair values. The Company values its stock options awarded using the Black-Scholes option pricing model. Restricted stock awards are valued at the grant date closing market price. Stock-based compensation costs are recognized over the vesting period, which is the period during which the employee is required to provide service in exchange for the award. Stock-based compensation paid to non-employees are valued at the fair value of the goods or services provided at the applicable measurement date and charged to expense as services are rendered. |
Reporting and Functional Currency | Reporting and Functional Currency The Company has adopted the U.S. dollar as the functional currency for all of its foreign subsidiaries. Gains and losses on foreign currency transactions are included in results of operations. |
Net Earnings (Loss) Per Common Share | Net Earnings (Loss) Per Common Share Basic net earnings or loss per common share is computed by dividing net earnings or loss by the weighted average number of shares of common stock outstanding at the end of the reporting period. Diluted net earnings or loss per share is computed by dividing net earnings or loss by the fully dilutive common stock equivalent, which consists of shares outstanding, augmented by potentially dilutive shares issuable upon the exercise of the Company’s stock options, non-vested restricted stock awards, and stock warrants and conversion of the 2014 Convertible Subordinated Note, calculated using the treasury stock method. |
Non-Controlling Interest | Non-Controlling Interests The Company reports its non-controlling interests as a separate component of equity. The Company also presents the consolidated net loss and the portion of the consolidated net loss allocable to the non-controlling interests and to the shareholders of the Company separately in its consolidated statements of operations. Losses attributable to the non-controlling interests are allocated to the non-controlling interests even when those losses are in excess of the non-controlling interests’ investment basis. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The carrying amounts of the Company’s financial instruments, which include cash and cash equivalents, restricted cash, accounts receivable, inventory, deposits, accounts payable and accrued liabilities, and debts at floating interest rates, approximate their fair values at December 31, 2016 and 2015 , respectively, principally due to the short-term nature, maturities or nature of interest rates of the above listed items. Fair Value Measurements Fair value is defined as the amount at which an asset (or liability) could be bought (or incurred) or sold (or settled) in an orderly transaction between market participants at the measurement date. The established framework for measuring fair value establishes a fair value hierarchy based on the quality of inputs used to measure fair value, and includes certain disclosure requirements. Fair value estimates are based on either (i) actual market data or (ii) assumptions that other market participants would use in pricing an asset or liability, including estimates of risk. There are three levels of valuation hierarchy for disclosure of fair value measurements. The valuation hierarchy categorizes assets and liabilities measured at fair value into one of three different levels depending on the observability of the inputs employed in the measurement. The three levels are defined as follows: Level 1 - Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities. The Company considers active markets as those in which transactions for the assets or liabilities occur in sufficient frequency and volume to provide pricing information on an on-going basis. Level 2 - Quoted prices in markets that are not active, or inputs which are observable, either directly or indirectly, for substantially the full term of the asset or liability. Substantially all of these inputs are observable in the marketplace throughout the term, can be derived from observable data, or supported by observable levels at which transactions are executed in the marketplace. Level 3 - Inputs that are unobservable and significant to the fair value measurement (including the Company’s own assumptions in determining fair value). The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability. Fair Value on a Non-Recurring Basis The Company used discounted cash flow techniques to determine the estimated fair value of its oil and gas properties as part of the Company's analysis for impairment. Accordingly, the Company estimated the present value of expected future net cash flows from the Oyo field, discounted using risk-adjusted cost of capital. Significant Level 3 assumptions used in the calculation include the Company's estimate of future crude oil prices, production costs, development costs, and anticipated production of proved reserves, as well as appropriate risk-adjusted probable and possible reserves. |
Reclassification | Reclassification Certain reclassifications have been made to the 2015 and 2014 consolidated financial statements to conform to the 2016 presentation. These reclassifications were not material to the accompanying consolidated financial statements. |
Recently Issued Accounting Standards | Recently Issued Accounting Standards In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) . ASU 2016-02 is aimed at making leasing activities more transparent and comparable, and requires substantially all leases be recognized by lessees on their balance sheet as a right-of-use asset and corresponding lease liability, including leases currently accounted for as operating leases. ASU 2016-02 is effective for the Company in the fiscal year beginning after December 15, 2018, and interim periods within those fiscal years with early adoption permitted. The Company is still evaluating the impact of this standard. However, due to the nature of its operations, the adoption of this standard could have a material impact on its consolidated financial statements. In March 2016, the FASB issued ASU No. 2016-07, Investments-Equity Method and Joint Ventures (Topic 323): Simplifying the Transition to the Equity Method of Accounting . ASU No. 2016-07 eliminates the requirement to retroactively adopt the equity method of accounting. ASU No. 2016-07 is effective for interim and annual periods beginning after December 15, 2016, and the Company will adopt this standards update, as required, beginning with the first quarter of 2017. The adoption of this standards update is not expected to have a material impact on the Company’s consolidated financial statements. In March 2016, the FASB issued ASU No. 2016-08, Revenue from Contracts with Customers (Topic 606): Principal versus Agent Consideration (Reporting Revenue Gross versus Net) . ASU No. 2016-08 requires that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. ASU No. 2016-08 is effective for interim and annual periods beginning after December 15, 2017, and the Company will adopt this standards update, as required, beginning with the first quarter of 2018. The adoption of this standards update is not expected to have a material impact on the Company’s consolidated financial statements. In March 2016, the FASB issued ASU No. 2016-09, Compensation-Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting . The areas of simplification in ASU No. 2016-09 involve several aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. ASU No. 2016-09 is effective for interim and annual periods beginning after December 15, 2016, and the Company will adopt this standards update, as required, beginning with the first quarter of 2017. The adoption of this standards update is not expected to have a material impact on the Company’s consolidated financial statements. In April 2016, the FASB issued ASU No. 2016-10, Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing . ASU No. 2016-10 clarifies two aspects of Topic 606: identifying performance obligations and the licensing implementation guidance, while retaining the related principles for those areas. ASU No. 2016-10 is effective for interim and annual periods beginning after December 15, 2017, and the Company will adopt this standards update, as required, beginning with the first quarter of 2018. The adoption of this standards update is not expected to have a material impact on the Company’s consolidated financial statements. In May 2016, the FASB issued ASU No. 2016-11, Revenue Recognition (Topic 605) and Derivatives and Hedging (Topic 815): Rescission of SEC Guidance Because of Accounting Standards Updates 2014-09 and 2014-16 Pursuant to Staff Announcements at the March 3, 2016 EITF Meeting . ASU No. 2016-11 rescinds SEC Staff Observer comments that are codified in Topic 605, Revenue Recognition, and Topic 932, Extractive Activities - Oil and Gas, effective upon adoption of Topic 606. ASU No. 2016-11 is effective for interim and annual periods beginning after December 15, 2017, and the Company will adopt this standards update, as required, beginning with the first quarter of 2018. The adoption of this standards update is not expected to have a material impact on the Company’s consolidated financial statements. In May 2016, the FASB issued ASU No. 2016-12, Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients . The core principle of ASU No. 2016-12 is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. ASU No. 2016-12 is effective for interim and annual periods beginning after December 15, 2017, and the Company will adopt this standards update, as required, beginning with the first quarter of 2018. The adoption of this standards update is not expected to have a material impact on the Company’s consolidated financial statements. In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments , which is intended to reduce diversity in practice in reporting certain items in the statement of cash flows. ASU No. 2016-15 is effective for interim and annual periods beginning after December 15, 2017, and the Company will adopt this standards update, as required, beginning with the first quarter of 2018. The Company does not expect adoption of ASU 2016-15 to have a material effect on its consolidated financial statements. In October 2016, the FASB issued ASU 2016-16, Intra-Entity Transfers of Assets Other Than Inventory , which provides guidance on recognition of current income tax consequences for intra-entity asset transfers (other than inventory) at the time of transfer. This represents a change from current GAAP, where the consolidated tax consequences of intra-entity asset transfers are deferred until the transferred asset is sold to a third party or otherwise recovered through use. The guidance is effective for annual reporting periods beginning after December 15, 2017 and interim periods within those annual periods. Early adoption at the beginning of an annual period is permitted. The adoption of this update is not expected to have a material impact on the Company’s consolidated financial statements. In October 2016, the FASB issued ASU 2016-17, Interests Held through Related Parties That Are under Common Control , which modifies existing guidance with respect to how a decision maker that holds an indirect interest in a VIE through a common control party determines whether it is the primary beneficiary of the VIE as part of the analysis of whether the VIE would need to be consolidated. Under this ASU, a decision maker would need to consider only its proportionate indirect interest in the VIE held through a common control party. This ASU is effective for annual reporting periods beginning after December 15, 2016 and interim periods within those annual periods. The adoption of this update is not expected to have a material impact on the Company’s consolidated financial statements. In November 2016, the FASB issued ASU 2016-18, S tatement of Cash Flows (Topic 230): Restricted Cash , which requires amounts generally described as restricted cash and restricted cash equivalents be included with cash and cash equivalents when reconciling the total beginning and ending amounts for the periods shown on the statement of cash flows. ASU 2016-18 is effective for fiscal years beginning after December 15, 2018 (including interim periods within those periods) using a retrospective transition method to each period presented. The adoption of this update is not expected to have a material impact on the Company’s consolidated financial statements. |
Basis of Presentation and Sig26
Basis of Presentation and Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Schedule of Shares Withholding and Repurchases of Common Stock | The following table sets forth information with respect to the withholding and related repurchases of the Company's common stock during the year ended December 31, 2016 . Total Number of Average Price January 1 - January 31, 2016 3,643 $ 4.02 February 1 - February 29, 2016 62,152 $ 2.16 March 1 - March 31, 2016 17,318 $ 2.31 May 1 - May 31, 2016 1,072 $ 2.48 September 1 - September 30, 2016 6,162 $ 2.29 November 1 - November 30, 2016 6,175 $ 2.35 December 1 - December 31, 2016 3,410 $ 2.10 Total 99,932 $ 2.28 (1) All shares repurchased were surrendered by employees to settle tax withholding obligations upon the vesting of restricted stock awards. |
Schedule of Anti-dilutive Securities | The table below sets forth the number of stock options, warrants, non-vested restricted stock, and shares issuable upon conversion of Convertible Subordinated Note that were excluded from dilutive shares outstanding during the years ended December 31, 2016 , 2015 and 2014 , as these securities are anti-dilutive because the Company was in a loss position each year. Years Ended December 31, (In thousands) 2016 2015 2014 Stock options 230 1,101 1,038 Stock warrants 3 541 6 Unvested restricted stock awards 1,942 1,275 997 Convertible note — 12,379 10,932 2,175 15,296 12,973 |
Fair Value Measurements, Nonrecurring | The following table presents information about the Company’s oil and gas properties measured at fair value on a non-recurring basis: Level 3 As of December 31, (in thousands) 2016 2015 Value of oil and gas properties (1) $ — $ 293,408 (1) This represents non-financial assets that are measured at fair value on a non-recurring basis due to impairments. This is the fair value of the asset base that was subjected to impairment and does not reflect the entire asset balance as presented on the accompanying balance sheets. Please see Note 5. — Property, Plant and Equipment for further information. Amounts included here are presented only in years where an impairment has occurred. |
Acquisitions (Tables)
Acquisitions (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Contractual Purchase Consideration | |
Schedule of Purchase Consideration Assets Acquired and Liabilities Assumed | The table below sets forth a summary of the contractual purchase consideration paid for the Allied Assets ( In thousands ): Cash consideration paid $ 170,000 Erin Energy Corporation common stock (1) — Long-term convertible subordinated note payable - related party 50,000 Total purchase price $ 220,000 Asset acquired and liabilities assumed as of February 21, 2014: Property, plant and equipment, net $ 248,736 Accounts payable (25,429 ) Asset retirement obligations (20,890 ) Net assets acquired 202,417 Excess of consideration paid over carrying value of assets acquired $ 17,583 (1) Because the cash and debt consideration exceeds the carrying value of the assets acquired, no value was assigned to the shares issued |
Property, Plant and Equipment (
Property, Plant and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment | Property, plant and equipment were comprised of the following: As of December 31, (In thousands) 2016 2015 Wells and production facilities $ 318,739 $ 329,133 Proved properties 386,196 386,196 Work in progress and exploration inventory 34,712 65,043 Oilfield assets 739,647 780,372 Accumulated depletion (483,754 ) (421,921 ) Oilfield assets, net 255,893 358,451 Unevaluated leaseholds 9,820 10,440 Oil and gas properties, net 265,713 368,891 Other property and equipment 3,040 2,963 Accumulated depreciation (2,324 ) (1,789 ) Other property and equipment, net 716 1,174 Total property, plant and equipment, net $ 266,429 $ 370,065 |
Accounts Payable and Accrued 29
Accounts Payable and Accrued Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Payables and Accruals [Abstract] | |
Schedule of Accounts Payable and Accrued Liabilities | The table below sets forth a summary of the Company’s accounts payable and accrued liabilities at December 31, 2016 and 2015 : As of December 31, (In thousands) 2016 2015 Accounts payable - vendors $ 173,306 $ 153,085 Amounts due to government entities 66,573 53,119 Accrued interest 3,074 2,510 Accrued payroll and benefits 1,204 629 Other liabilities 806 3,777 $ 244,963 $ 213,120 |
Asset Retirement Obligations (T
Asset Retirement Obligations (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Asset Retirement Obligation Disclosure [Abstract] | |
Summary of Changes in Asset Retirement Obligations | The following table summarizes changes in the Company’s asset retirement obligations during the years ended December 31, 2016 and 2015 : (In thousands) 2016 2015 Asset retirement obligations at January 1 $ 20,609 $ 26,533 Accretion expense 1,867 1,931 Additions — 9,416 Revisions in estimated liabilities — (4,284 ) Loss on settlement of asset retirement obligations — 3,653 Payments to settle asset retirement obligations — (16,640 ) Asset retirement obligations at December 31 $ 22,476 $ 20,609 |
Summary of Current and Long-term Portions of Asset Retirement Obligations | The table below shows the current and long-term portions of the Company's asset retirement obligations as of the end of December 31, 2016 and 2015 : As of December 31, (In thousands) 2016 2015 Asset retirement obligations, current portion $ — $ — Asset retirement obligations, long-term portion 22,476 20,609 $ 22,476 $ 20,609 |
Debt Debt (Tables)
Debt Debt (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Debt Disclosure [Abstract] | |
Schedule of Principal Repayments of Long-term Debt | Scheduled principal repayments on the outstanding balance on the Term Loan Facility are as follows ( in thousands ): Scheduled payments by year Principal 2017 $ 13,413 2018 19,673 2019 21,460 2020 27,265 2021 and thereafter 7,609 Total principal payments $ 89,420 Less: Unamortized debt issuance costs 2,347 Total Term Loan Facility, net $ 87,073 |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Related Party Transactions [Abstract] | |
Summary of Related Party Transactions and Balances | The table below sets forth the related party assets and liabilities as of December 31, 2016 and 2015 : As of December 31, (In thousands) 2016 2015 Accounts receivable, CEHL $ 1,956 $ 1,186 Accounts payable and accrued liabilities, CEHL $ 29,513 $ 30,133 Long-term notes payable - related party, CEHL $ 129,796 $ 120,006 The table below sets forth the transactions incurred with affiliates during the years ended December 31, 2016 , 2015 and 2014 : Year Ended December 31, (In thousands) 2016 2015 2014 Total operating expenses, CEHL $ 14,621 $ 15,106 $ 14,449 Interest expense, CEHL $ 6,843 $ 5,490 $ 2,414 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Significant Future Commitments on Non-Cancellable Operating Leases and Estimated Obligations Arising from its Minimum Work Obligations | The following table summarizes the Company’s significant future commitments on non-cancellable operating leases and estimated obligations arising from its minimum work obligations for the five years after December 31, 2016 and thereafter: Payments Due By Period (In thousands) Total 2017 2018 2019 2020 2021 Thereafter Operating lease obligations: FPSO and drilling rig leases - Nigeria $ 193,451 $ 48,363 $ 48,362 $ 48,363 $ 48,363 $ — $ — Office leases 1,600 537 493 450 81 39 — Minimum work obligations: Kenya 65,133 65,133 — — — — — The Gambia 1,200 600 600 — — — — Ghana 10,650 10,650 — — — — — Total $ 272,034 $ 125,283 $ 49,455 $ 48,813 $ 48,444 $ 39 $ — |
Stock Based Compensation (Table
Stock Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Summary of Restricted Stock Activity | The table below sets forth a summary of RSA activity for the year ended December 31, 2016 . Shares (In Thousands) Weighted-Average Grant Date Fair Value Restricted Stock Non-vested at December 31, 2015 1,114 $3.21 Granted 1,716 $2.16 Vested (669 ) $3.56 Forfeited (89 ) $2.59 Non-vested as of December 31, 2016 2,072 $2.25 |
Stock warrants | |
Summary of Stock Option Activity | The table below sets forth a summary of stock warrant activity for the year ended December 31, 2016 . Shares Underlying Warrants (In Thousands) Weighted-Average Exercise Price Weighted-Average Remaining Contractual Term (Years) Stock warrants Outstanding at December 31, 2015 2,935 $3.61 4.2 Granted 48 $2.07 4.3 Exercised — $— — Forfeited — $— — Expired — $— — Outstanding at December 31, 2016 2,983 $3.59 3.2 Expected to vest — $— — Exercisable at December 31, 2016 2,983 $3.59 3.2 |
Summary of Weighted-Average Amounts for Assumptions | The table below shows the weighted-average amounts and the assumptions used in the model for warrants issued during each year. 2016 2015 2014 Expected price volatility 84.7% - 84.8% 76.8% - 83.2% 82.7 % Risk free interest rate (U.S. treasury bonds) 0.8 % 0.8% - 1.1% 1.1 % Expected annual dividend yield — — — Expected option term (years) 3.0 3.0 3.0 Weighted-average grant date fair value per share $ 1.12 $ 1.86 $ 1.80 |
Stock Options | |
Summary of Stock Option Activity | The table below sets forth a summary of stock option activity for the year ended December 31, 2016 . Shares Underlying Options (In Thousands) Weighted-Average Exercise Price Weighted-Average Remaining Contractual Term (Years) Stock Options Outstanding at December 31, 2015 2,532 $2.29 1.6 Granted — $— — Exercised (1,200 ) $1.84 — Forfeited (27 ) $3.42 — Expired (158 ) $3.70 — Outstanding at December 31, 2016 1,147 $2.54 2.0 Expected to vest 908 $2.21 1.6 Exercisable at December 31, 2016 239 $3.79 3.4 |
Summary of Weighted-Average Amounts for Assumptions | The table below shows the weighted-average amounts and the assumptions used in the model for options awarded in each year under equity incentive plans. 2016 2015 2014 Expected price volatility —% 77.1% - 83.1% 87.7 % Risk free interest rate (U.S. treasury bonds) —% 1.0 to 1.2 % 1.1 % Expected annual dividend yield — — — Expected option term (years) — 3.0 3.0 Weighted-average grant date fair value per share — $ 2.73 $ 1.92 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
Reconciliation of Expected Statutory U.S. Federal Income Tax Provision | Following is a reconciliation of the expected statutory U.S. Federal income tax provision to the actual income tax expense for the respective periods: Years Ended December 31, (In thousands) 2016 2015 2014 Net loss attributable to Erin Energy Corporation before income tax expense $ (142,401 ) $ (430,937 ) $ (96,062 ) Expected income tax provision at statutory rate of 35% (49,840 ) (150,828 ) (33,622 ) Increase (decrease) due to: Foreign rate differential (17,202 ) (59,467 ) (10,083 ) Change in valuation allowance 71,148 256,910 98,376 Investment tax credit - Nigeria 1,991 (35,580 ) (40,765 ) Non-deductible expenses and other (6,097 ) (11,035 ) (13,906 ) Total income tax expense $ — $ — $ — |
Significant Components of Deferred Tax Assets | Significant components of our deferred tax assets are as follows: As of December 31, (In thousands) 2016 2015 Basis difference in fixed assets $ (3,249 ) $ 11,893 Unused capital allowances 572,051 506,795 Net operating losses 109,230 88,391 Other 12,421 12,226 690,453 619,305 Valuation allowance (690,453 ) (619,305 ) Net deferred income tax assets $ — $ — |
Summary of Tax Years Remain Subject to Examination | The following table summarizes the tax years that remain subject to examination by major tax jurisdictions: United States: 2007 - 2016 Nigeria: 2010 - 2016 Kenya: 2012 - 2016 The Gambia: 2012 - 2016 |
Segment Information (Tables)
Segment Information (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Segment Reporting [Abstract] | |
Schedule of Segment Activity | The table below sets forth segment activity for the years ended December 31, 2016 , 2015 , and 2014 . (In thousands) Nigeria Kenya The Gambia Ghana Corporate and Other Total For the Years Ended December 31, 2016 Revenues $ 77,815 $ — $ — $ — $ — $ 77,815 Operating loss $ (119,346 ) $ (2,569 ) $ (1,570 ) $ (1,677 ) $ (11,830 ) $ (136,992 ) 2015 Revenues $ 68,429 $ — $ — $ — $ — $ 68,429 Operating loss $ (387,448 ) $ (8,038 ) $ (5,209 ) $ (1,931 ) $ (13,807 ) $ (416,433 ) 2014 Revenues $ 53,844 $ — $ — $ — $ — $ 53,844 Operating loss $ (64,716 ) $ (12,130 ) $ (1,347 ) $ (492 ) $ (14,640 ) $ (93,325 ) The table below sets forth the total assets by segment as of December 31, 2016 and 2015 . (In thousands) Nigeria Kenya The Gambia Ghana Corporate and Other Total Total Assets December 31, 2016 $ 281,050 $ 698 $ 3,034 $ 3,648 $ 771 $ 289,201 December 31, 2015 $ 387,326 $ 1,399 $ 3,016 $ 2,447 $ 971 $ 395,159 |
Selected Unaudited Quarterly 37
Selected Unaudited Quarterly Financial Data (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Quarterly Financial Information Disclosure [Abstract] | |
Schedule of Selected Unaudited Quarterly Financial Data | Three Months Ended, March 31, 2016 June 30, 2016 September 30, 2016 December 31, 2016 Total revenues $ 4,929 $ 23,151 $ 28,619 $ 21,116 Operating loss $ (28,293 ) $ (27,199 ) $ (21,817 ) $ (59,683 ) Net loss attributable to Erin Energy Corporation $ (32,411 ) $ (22,572 ) $ (23,471 ) $ (63,947 ) Net loss per common share attributable to Erin Energy Corporation Basic $ (0.15 ) $ (0.11 ) $ (0.11 ) $ (0.30 ) Diluted $ (0.15 ) $ (0.11 ) $ (0.11 ) $ (0.30 ) Three Months Ended, March 31, 2015 June 30, 2015 September 30, 2015 December 31, 2015 Total revenues $ — $ — $ 28,667 $ 39,762 Operating loss $ (32,031 ) $ (5,821 ) $ (53,423 ) $ (325,158 ) Net loss attributable to Erin Energy Corporation $ (33,059 ) $ (9,162 ) $ (58,682 ) $ (330,034 ) Net loss per common share attributable to Erin Energy Corporation Basic $ (0.16 ) $ (0.04 ) $ (0.28 ) $ (1.56 ) Diluted $ (0.16 ) $ (0.04 ) $ (0.28 ) $ (1.56 ) |
Correction of Immaterial Erro38
Correction of Immaterial Error in Previously Issued Consolidated Financial Statements (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Changes and Error Corrections [Abstract] | |
Schedule of Error Corrections and Prior Period Adjustments | The following table reflects the amounts within the consolidated balance sheet, statement of operations, and statement of cash flows as originally reported to amounts as now reflected as of and for the year ended December 31, 2015. (In thousands) December 31, 2015 As Originally Reported Adjustments Corrected Consolidated Balance Sheet Oil and gas properties, net $ 348,331 $ 20,560 $ 368,891 Total property, plant and equipment, net $ 349,505 $ 20,560 $ 370,065 Accumulated deficit $ (896,451 ) $ 20,560 $ (875,891 ) Total capital deficiency $ (105,827 ) $ 20,560 $ (85,267 ) Consolidated Statement of Operations - for the year ended Impairment of oil and gas properties $ 281,768 $ (20,560 ) $ 261,208 Total operating costs and expenses $ 505,422 $ (20,560 ) $ 484,862 Net loss $ (451,497 ) $ 20,560 $ (430,937 ) Basic and diluted loss per share attributable to Erin Energy Corporation $ (2.13 ) $ 0.09 $ (2.04 ) Consolidated Statement of Cash Flows - for the year ended Net loss, including non-controlling interest $ (452,459 ) $ 20,560 $ (431,899 ) Impairment of oil and gas properties $ 281,768 $ (20,560 ) $ 261,208 |
Company Description - Additiona
Company Description - Additional Information (Details) - Dec. 31, 2016 km² in Thousands, a in Millions | a | license | country | km² |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||
Number of exploration and production licenses | license | 7 | |||
Number of countries company operates in Africa | country | 4 | |||
Area of land held for exploration activities | 5 | 19 |
Basis of Presentation and Sig40
Basis of Presentation and Significant Accounting Policies - Additional Information (Details) | Apr. 22, 2015 | Feb. 28, 2014shares | Dec. 31, 2016USD ($)customershares | Dec. 31, 2015USD ($)customershares | Dec. 31, 2014USD ($) |
Basis Of Presentation And Significant Accounting Policies [Line Items] | |||||
Reverse stock split, conversion ratio | 0.1667 | ||||
Restricted cash | $ 2,600,000 | $ 8,700,000 | |||
Allowance for doubtful accounts receivable | 0 | ||||
Accounts receivable - partners | 674,000 | 287,000 | |||
Crude oil inventory | 9,398,000 | 4,789,000 | |||
Oilfield materials and supplies inventory | 34,700,000 | 30,000,000 | |||
Less: Unamortized debt issuance costs | 2,347,000 | 1,600,000 | |||
Capitalized interest cost | $ 0 | $ 2,200,000 | |||
Number of shares withheld (in shares) | shares | 99,932 | 0 | |||
Common stock, issued value | $ 213,000 | $ 212,000 | |||
Noncontrolling interest in joint ventures | 700,000 | 800,000 | |||
Impairment of oil and gas properties | $ 645,000 | $ 261,208,000 | $ 0 | ||
Number of crude oil customers | customer | 1 | 2 | |||
Minimum | |||||
Basis Of Presentation And Significant Accounting Policies [Line Items] | |||||
Productive oil and gas properties, estimated useful life (years) | 3 years | ||||
Maximum | |||||
Basis Of Presentation And Significant Accounting Policies [Line Items] | |||||
Productive oil and gas properties, estimated useful life (years) | 5 years | ||||
Ghana | Joint Venture partners | |||||
Basis Of Presentation And Significant Accounting Policies [Line Items] | |||||
Accounts receivable - partners | $ 700,000 | $ 300,000 | |||
Except Kenya off-shore leases | |||||
Basis Of Presentation And Significant Accounting Policies [Line Items] | |||||
Impairment of oil and gas properties | 0 | ||||
Allied | |||||
Basis Of Presentation And Significant Accounting Policies [Line Items] | |||||
Business acquisition, number of shares issued | shares | 82,900,000 | ||||
Contingent additional payments under transfer agreement | 50,000,000 | ||||
Trade Accounts Receivable | |||||
Basis Of Presentation And Significant Accounting Policies [Line Items] | |||||
Accounts receivable, current | 0 | 1,000,000 | |||
Fair Value, Inputs, Level 1 | Fair Value, Measurements, Nonrecurring | |||||
Basis Of Presentation And Significant Accounting Policies [Line Items] | |||||
Fair value, oil and gas properties | 0 | 293,408,000 | |||
Long-term Debt, Current Maturities | |||||
Basis Of Presentation And Significant Accounting Policies [Line Items] | |||||
Debt issuance costs, current | 800,000 | 1,600,000 | |||
Long-term Debt | |||||
Basis Of Presentation And Significant Accounting Policies [Line Items] | |||||
Deferred finance costs, noncurrent | $ 1,600,000 | 0 | |||
Accounting Standards Update 2015-03 | Long-term Debt, Current Maturities | |||||
Basis Of Presentation And Significant Accounting Policies [Line Items] | |||||
Less: Unamortized debt issuance costs | 1,600,000 | ||||
Accounting Standards Update 2015-03 | Prepaid Expenses and Other Current Assets | |||||
Basis Of Presentation And Significant Accounting Policies [Line Items] | |||||
Less: Unamortized debt issuance costs | $ (1,600,000) |
Basis of Presentation and Sig41
Basis of Presentation and Significant Accounting Policies - Shares Withholding and Repurchases of Common Stock (Details) - $ / shares | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Total Number of Shares Purchased (in shares) | 99,932 | 0 |
Average Price Paid Per Share (in dollars per share) | $ 2.28 | |
January 1 - January 31, 2016 | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Total Number of Shares Purchased (in shares) | 3,643 | |
Average Price Paid Per Share (in dollars per share) | $ 4.02 | |
February 1 - February 29, 2016 | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Total Number of Shares Purchased (in shares) | 62,152 | |
Average Price Paid Per Share (in dollars per share) | $ 2.16 | |
March 1 - March 31, 2016 | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Total Number of Shares Purchased (in shares) | 17,318 | |
Average Price Paid Per Share (in dollars per share) | $ 2.31 | |
May 1 - May 31, 2016 | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Total Number of Shares Purchased (in shares) | 1,072 | |
Average Price Paid Per Share (in dollars per share) | $ 2.48 | |
September 1 - September 30, 2016 | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Total Number of Shares Purchased (in shares) | 6,162 | |
Average Price Paid Per Share (in dollars per share) | $ 2.29 | |
November 1 - November 30, 2016 | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Total Number of Shares Purchased (in shares) | 6,175 | |
Average Price Paid Per Share (in dollars per share) | $ 2.35 | |
December 1 - December 31, 2016 | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Total Number of Shares Purchased (in shares) | 3,410 | |
Average Price Paid Per Share (in dollars per share) | $ 2.10 |
Basis of Presentation and Sig42
Basis of Presentation and Significant Accounting Polices - Schedule of Anti-dilutive Securities (Details) - shares shares in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Anti-dilutive securities (in shares) | 2,175 | 15,296 | 12,973 |
Stock options | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Anti-dilutive securities (in shares) | 230 | 1,101 | 1,038 |
Stock warrants | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Anti-dilutive securities (in shares) | 3 | 541 | 6 |
Unvested restricted stock awards | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Anti-dilutive securities (in shares) | 1,942 | 1,275 | 997 |
Convertible note | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Anti-dilutive securities (in shares) | 0 | 12,379 | 10,932 |
Liquidity Matters and Going C43
Liquidity Matters and Going Concern (Details) $ in Thousands | 9 Months Ended | ||
Sep. 30, 2016bbl | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | |
Liquidity Matters [Abstract] | |||
Current liabilities | $ 287,103 | $ 339,811 | |
Current assets | 22,706 | $ 25,027 | |
Working capital, accumulated deficit, current | $ (264,400) | ||
Production, emergency shut-in, barrels of oil lost per day | bbl | 1,400 |
Acquisitions - Additional infor
Acquisitions - Additional information (Details) $ in Thousands, shares in Millions | 1 Months Ended | 12 Months Ended | |
Apr. 30, 2014wellfield | Feb. 28, 2014USD ($)shares | Dec. 31, 2016 | |
Business Acquisition [Line Items] | |||
Cash consideration | $ | $ 170,000 | ||
Share Purchase Agreement | Private Placement | |||
Business Acquisition [Line Items] | |||
Business acquisition, number of shares issued | shares | 62.8 | ||
Business acquisition, value of shares issued | $ | $ 270,000 | ||
Allied Transaction | Convertible Subordinated Note | |||
Business Acquisition [Line Items] | |||
Cash consideration | $ | $ 170,000 | ||
Business acquisition, number of shares issued | shares | 82.9 | ||
Tano Block in Ghana | |||
Business Acquisition [Line Items] | |||
Additional on exploration (percent) | 10.00% | ||
Number of previously discovered fields | field | 3 | ||
Initial exploration period (years) | 2 years | ||
Initial Exploration extension period | 18 months | ||
Tano Block in Ghana | Ghana | |||
Business Acquisition [Line Items] | |||
Production sharing contracts with governments or authorities (percent) | 50.00% | ||
Tano Block in Ghana | CAMAC Energy | |||
Business Acquisition [Line Items] | |||
Maximum participation (percent) | 90.00% | ||
Tano Block in Ghana | Ghana Limited | |||
Business Acquisition [Line Items] | |||
Maximum participation (percent) | 60.00% | ||
Tano Block in Ghana | GNPC Exploration and Production Company Limited | |||
Business Acquisition [Line Items] | |||
Maximum participation (percent) | 25.00% | ||
Tano Block in Ghana | Base Energy | |||
Business Acquisition [Line Items] | |||
Maximum participation (percent) | 15.00% | ||
First Extension Period | Tano Block in Ghana | |||
Business Acquisition [Line Items] | |||
Maximum number of additional exploration period (years) | 1 year 6 months | ||
Number of exploration wells | well | 1 | ||
Second Extension Period | Tano Block in Ghana | |||
Business Acquisition [Line Items] | |||
Maximum number of additional exploration period (years) | 2 years 6 months | ||
Minimum | Second Extension Period | Tano Block in Ghana | |||
Business Acquisition [Line Items] | |||
Number of exploration wells | well | 1 | ||
Maximum | Second Extension Period | Tano Block in Ghana | |||
Business Acquisition [Line Items] | |||
Number of exploration wells | well | 2 |
Acquisitions - Purchase Conside
Acquisitions - Purchase Consideration Paid and Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Thousands | 1 Months Ended | |
Feb. 28, 2014 | Feb. 21, 2014 | |
Business Combinations [Abstract] | ||
Cash consideration paid | $ 170,000 | |
Erin Energy Corporation common stock | 0 | |
Long-term convertible subordinated note payable - related party | 50,000 | |
Total purchase price | $ 220,000 | |
Asset acquired and liabilities assumed: | ||
Property, plant and equipment, net | $ 248,736 | |
Accounts payable | (25,429) | |
Asset retirement obligations | (20,890) | |
Net assets acquired | 202,417 | |
Excess of consideration paid over carrying value of assets acquired | $ 17,583 |
Property, Plant and Equipment46
Property, Plant and Equipment (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Property, Plant and Equipment [Abstract] | ||
Wells and production facilities | $ 318,739 | $ 329,133 |
Proved properties | 386,196 | 386,196 |
Work in progress and exploration inventory | 34,712 | 65,043 |
Oilfield assets | 739,647 | 780,372 |
Accumulated depletion | (483,754) | (421,921) |
Oilfield assets, net | 255,893 | 358,451 |
Unevaluated leaseholds | 9,820 | 10,440 |
Oil and gas properties, net | 265,713 | 368,891 |
Other property and equipment | 3,040 | 2,963 |
Accumulated depreciation | (2,324) | (1,789) |
Other property and equipment, net | 716 | 1,174 |
Total property, plant and equipment, net | $ 266,429 | $ 370,065 |
Property, Plant and Equipment -
Property, Plant and Equipment - Additional Information (Details) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Property Plant And Equipment [Line Items] | ||||
Exploratory expenses | $ 39,269 | $ 16,437 | $ 14,283 | |
Unevaluated leaseholds | $ 9,820 | 9,820 | 10,440 | |
Impairment of oil and gas properties | 645 | 261,208 | $ 0 | |
Noncash Impairment of oil and gas properties | 228,600 | |||
The Gambia | ||||
Property Plant And Equipment [Line Items] | ||||
Payments to acquire rights to the properties | 1,000 | |||
Ghana | ||||
Property Plant And Equipment [Line Items] | ||||
Payments to acquire rights to the properties | $ 1,200 | |||
Kenya | ||||
Property Plant And Equipment [Line Items] | ||||
Impairment of oil and gas properties | $ 600 | |||
Uncompleted Wells Equipment and Facilities | ||||
Property Plant And Equipment [Line Items] | ||||
Impairment of oil and gas properties | 32,600 | |||
Miocene and Pilocene Exploratory Drilling Activities | ||||
Property Plant And Equipment [Line Items] | ||||
Exploratory expenses | $ 33,000 |
Suspended Exploratory Well Co48
Suspended Exploratory Well Costs - Additional Information (Details) $ in Thousands | 1 Months Ended | 12 Months Ended | |||
Aug. 31, 2014reservoirftm | Nov. 30, 2013intervalft | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | |
Costs Incurred Oil And Gas Property Acquisition Exploration And Development Activities [Line Items] | |||||
Number of hydrocarbons Miocene formation intervals | interval | 3 | ||||
Number of feet encountered by Hydrocarbons in three intervals, as interpreted by “LWD” data | ft | 65 | ||||
Exploration expense | $ 39,269 | $ 16,437 | $ 14,283 | ||
Pliocene formation Eastern fault block vertical depth, feet | ft | 6,059 | ||||
Pliocene formation Eastern fault block vertical depth, meters | m | 1,847 | ||||
Number of Pliocene formation Eastern fault block new oil and gas reservoirs | reservoir | 4 | ||||
Hydrocarbons Pliocene formation Eastern fault block gross thickness | ft | 112 | ||||
Miocene Exploratory Drilling Activities | |||||
Costs Incurred Oil And Gas Property Acquisition Exploration And Development Activities [Line Items] | |||||
Suspended exploratory well cost | 26,500 | ||||
Exploration expense | 26,500 | ||||
Pliocene Exploratory Drilling Activity | |||||
Costs Incurred Oil And Gas Property Acquisition Exploration And Development Activities [Line Items] | |||||
Suspended exploratory well cost | $ 6,500 | ||||
Exploration expense | $ 6,500 |
Accounts Payable and Accrued 49
Accounts Payable and Accrued Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Payables and Accruals [Abstract] | ||
Accounts payable - vendors | $ 173,306 | $ 153,085 |
Amounts due to government entities | 66,573 | 53,119 |
Accrued interest | 3,074 | 2,510 |
Accrued payroll and benefits | 1,204 | 629 |
Other liabilities | 806 | 3,777 |
Total accounts payable and accrued liabilities | $ 244,963 | $ 213,120 |
Asset Retirement Obligations -
Asset Retirement Obligations - Summary of Change in Asset Retirement Obligations (Details) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | ||
Apr. 30, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Asset Retirement Obligation, Roll Forward Analysis [Roll Forward] | ||||
Beginning balance, asset retirement obligation | $ 20,609 | $ 26,533 | ||
Accretion expense | 1,867 | 1,931 | $ 2,166 | |
Additions | 0 | 9,416 | ||
Revisions in estimated liabilities | 0 | (4,284) | 3,766 | |
Loss on settlement of asset retirement obligations | 0 | 3,653 | 0 | |
Payments to settle asset retirement obligations | 0 | (16,640) | 0 | |
Ending balance, asset retirement obligation | 22,476 | 20,609 | 26,533 | |
Loss on settlement of asset retirement obligations | $ 3,700 | $ 205 | $ 3,653 | $ 0 |
Asset Retirement Obligations 51
Asset Retirement Obligations - Summary of Current and Long-term Portions of Asset Retirement Obligations (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 |
Asset Retirement Obligation [Abstract] | |||
Asset retirement obligations, current portion | $ 0 | $ 0 | |
Asset retirement obligations, long-term portion | 22,476 | 20,609 | |
Asset retirement obligations | $ 22,476 | $ 20,609 | $ 26,533 |
Debt - Additional Information (
Debt - Additional Information (Details) | Aug. 08, 2016$ / bbl | Aug. 31, 2016USD ($) | Jul. 31, 2016 | Jun. 30, 2016USD ($) | May 31, 2016USD ($) | Apr. 30, 2016USD ($) | Mar. 31, 2016USD ($) | Sep. 30, 2014USD ($) | Feb. 28, 2014USD ($)$ / shares | Mar. 15, 2017$ / shares | Dec. 31, 2016USD ($)$ / sharesshares | Dec. 31, 2016USD ($)$ / sharesshares | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | Mar. 31, 2015USD ($) |
Debt Instrument [Line Items] | |||||||||||||||
Foreign currency transaction gain unrealized | $ 15,674,000 | $ 2,520,000 | $ 1,572,000 | ||||||||||||
Total Term Loan Facility, net | $ 87,073,000 | 87,073,000 | |||||||||||||
Current portion of long-term debt, net | 12,627,000 | 12,627,000 | 96,558,000 | ||||||||||||
Term loan facility | 129,796,000 | 129,796,000 | 120,006,000 | ||||||||||||
Promissory note | 129,800,000 | 129,800,000 | |||||||||||||
Notes payable - related party | 50,000,000 | 50,000,000 | |||||||||||||
Long-term debt, gross | $ 89,420,000 | 89,420,000 | |||||||||||||
Warrants issued with debt | 53,000 | 4,911,000 | |||||||||||||
Proceeds from short-term note payable | $ 504,000 | 0 | $ 0 | ||||||||||||
Promissory Note To Allied | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Promissory note | 25,000,000 | ||||||||||||||
2015 Convertible Note | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Number of securities called by warrants (shares) | shares | 48,291 | 48,291 | |||||||||||||
Notes Payable, Other Payables | Prepayment Agreement with Total Oil Trading SA | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Proceeds from short-term debt | $ 6,000,000 | $ 4,700,000 | |||||||||||||
Notes Payable to Banks | 2016 Short-Term Note | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Proceeds from short-term debt | $ 500,000 | ||||||||||||||
Line of credit facility, commitment fee (percent) | 2.50% | 2.50% | |||||||||||||
Debt instrument, term (years) | 30 years | 30 years | |||||||||||||
Allied | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Notes payable - related party | $ 50,000,000 | $ 50,000,000 | |||||||||||||
Number of securities called by warrants (shares) | shares | 2,700,000 | 2,700,000 | |||||||||||||
Allied | Promissory Note To Allied | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Debt instrument, term (years) | 30 days | ||||||||||||||
Maximum borrowing capacity | $ 25,000,000 | $ 25,000,000 | |||||||||||||
Promissory note | 24,900,000 | 24,900,000 | |||||||||||||
Majority Shareholder | Line of Credit | Promissory Note to Majority Shareholder Related Party | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Interest payable | 400,000 | 400,000 | |||||||||||||
Term loan facility | 6,400,000 | $ 6,400,000 | |||||||||||||
Promissory note | $ 1,000,000 | $ 3,000,000 | |||||||||||||
60-Day London Interbank Offered Rate (LIBOR) | Notes Payable, Other Payables | Prepayment Agreement with Total Oil Trading SA | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Debt instrument, basis spread on variable rate (percent) | 5.00% | 5.00% | |||||||||||||
1-Month LIBOR | Majority Shareholder | Line of Credit | Promissory Note to Majority Shareholder Related Party | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Debt instrument, basis spread on variable rate (percent) | 7.00% | 7.00% | |||||||||||||
London Interbank Offered Rate (LIBOR) | Allied | Promissory Note To Allied | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Debt instrument, basis spread on variable rate (percent) | 2.00% | ||||||||||||||
Line of Credit | Allied | Promissory Note To Allied | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Interest payable | 1,600,000 | $ 1,600,000 | |||||||||||||
Line of Credit | Majority Shareholder | Promissory Note to Majority Shareholder Related Party | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Maximum borrowing capacity | $ 10,000,000 | ||||||||||||||
Proceeds from short-term note payable | 2,400,000 | ||||||||||||||
Line of Credit | 1-Month LIBOR | Majority Shareholder | Promissory Note to Majority Shareholder Related Party | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Debt instrument, basis spread on variable rate (percent) | 7.00% | ||||||||||||||
Convertible Subordinated Debt | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Term loan facility | 50,000,000 | ||||||||||||||
Convertible Subordinated Debt | Allied | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Debt instrument, term (years) | 5 years | ||||||||||||||
Debt instrument, convertible, conversion price (dollars per share) | $ / shares | $ 4.2984 | ||||||||||||||
Debt instrument, default, maximum time period (days) | 30 days | ||||||||||||||
Unremedied material breach, maximum time period (days) | 10 days | ||||||||||||||
Interest payable | 8,000,000 | $ 8,000,000 | |||||||||||||
Minimum threshold proceeds from capital market debt issuance for mandatory prepayment option | $ 250,000,000 | ||||||||||||||
Convertible Subordinated Debt | London Interbank Offered Rate (LIBOR) | Allied | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Debt instrument, basis spread on variable rate (percent) | 5.00% | ||||||||||||||
Convertible Debt | 2015 Convertible Note | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Long-term debt, excluding current maturities | $ 45,000,000 | ||||||||||||||
Convertible Debt | Allied | 2015 Convertible Note | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Maximum borrowing capacity | $ 50,000,000 | ||||||||||||||
Long-term debt, excluding current maturities | 48,500,000 | $ 48,500,000 | |||||||||||||
Interest payable | 4,900,000 | 4,900,000 | |||||||||||||
Long-term debt, gross | 48,500,000 | 48,500,000 | |||||||||||||
Warrants issued with debt | 5,000,000 | ||||||||||||||
Unamortized debt issuance costs | 0 | 0 | |||||||||||||
Term Loan Facility | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Debt instrument, term (years) | 5 years | ||||||||||||||
Maximum borrowing capacity | $ 100,000,000 | ||||||||||||||
Line of credit facility, maximum borrowing capacity available in USD (percent) | 90.00% | ||||||||||||||
Line of credit facility, maximum borrowing capacity available in Nigerian Naira (percent) | 10.00% | ||||||||||||||
Line of credit facility, principal payment moratorium period | 12 months | ||||||||||||||
Line of credit facility, reduction of funding of debt service reserve account, price of oil per barrel initial threshold | $ / bbl | 55 | ||||||||||||||
Line of credit facility, commitment fee amount | $ 1,400,000 | 2,600,000 | |||||||||||||
Unamortized debt issuance costs | 2,300,000 | $ 2,300,000 | |||||||||||||
Debt instrument, default, maximum time period (days) | 30 days | ||||||||||||||
Unremedied material breach, maximum time period (days) | 30 days | ||||||||||||||
Foreign currency transaction gain unrealized | $ 4,300,000 | ||||||||||||||
Total Term Loan Facility, net | 87,073,000 | 87,073,000 | |||||||||||||
Long-term debt, excluding current maturities | 74,446,000 | 74,446,000 | |||||||||||||
Current portion of long-term debt, net | 12,627,000 | 12,627,000 | |||||||||||||
Interest payable | $ 3,100,000 | 3,100,000 | |||||||||||||
Term Loan Facility | London Interbank Offered Rate (LIBOR) | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Debt instrument, basis spread on variable rate (percent) | 11.10% | ||||||||||||||
Term Loan Facility, Naira Portion | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Annual principal payment | 400,000 | ||||||||||||||
Term Loan Facility, U.S. Dollar Portion | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Annual principal payment | $ 5,600,000 | ||||||||||||||
Minimum | 2015 Convertible Note | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Exercise price of warrants (dollars per share) | $ / shares | $ 2 | $ 2 | |||||||||||||
Minimum | Allied | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Exercise price of warrants (dollars per share) | $ / shares | 2 | 2 | |||||||||||||
Maximum | 2015 Convertible Note | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Exercise price of warrants (dollars per share) | $ / shares | 2.13 | 2.13 | |||||||||||||
Maximum | Allied | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Exercise price of warrants (dollars per share) | $ / shares | $ 7.85 | $ 7.85 | |||||||||||||
Subsequent Event | Allied | Promissory Note To Allied | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Debt instrument, convertible, conversion price (dollars per share) | $ / shares | $ 3.415 | ||||||||||||||
Subsequent Event | Majority Shareholder | Line of Credit | Promissory Note to Majority Shareholder Related Party | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Debt instrument, convertible, conversion price (dollars per share) | $ / shares | $ 3.415 | ||||||||||||||
Subsequent Event | Convertible Debt | London Interbank Offered Rate (LIBOR) | Allied | 2015 Convertible Note | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Debt instrument, basis spread on variable rate (percent) | 5.00% |
Debt - Schedule of Principal Re
Debt - Schedule of Principal Repayments of Long-term Debt (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Debt Disclosure [Abstract] | ||
2,017 | $ 13,413 | |
2,018 | 19,673 | |
2,019 | 21,460 | |
2,020 | 27,265 | |
2021 and thereafter | 7,609 | |
Total principal payments | 89,420 | |
Less: Unamortized debt issuance costs | 2,347 | $ 1,600 |
Total Term Loan Facility, net | $ 87,073 |
Related Party Transactions Summ
Related Party Transactions Summary of Related Party Transactions and Balances (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Related Party Transactions [Abstract] | |||
Accounts receivable, CEHL | $ 1,956 | $ 1,186 | |
Accounts payable and accrued liabilities, CEHL | 29,513 | 30,133 | |
Long-term notes payable - related party, CEHL | 129,796 | 120,006 | |
Total operating expenses, CEHL | 14,621 | 15,106 | $ 14,449 |
Interest expense, CEHL | $ 6,843 | $ 5,490 | $ 2,414 |
Related Party Transactions - Ad
Related Party Transactions - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | |||||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Apr. 30, 2016 | Mar. 31, 2016 | Apr. 30, 2014 | |
Related Party Transaction [Line Items] | ||||||
Accounts receivable, CEHL | $ 1,956 | $ 1,186 | ||||
Accounts payable and accrued expenses | 29,500 | 30,100 | ||||
Related party, accrued interest on notes payable | 15,200 | 8,300 | ||||
Promissory note | 129,800 | |||||
Convertible subordinate note issued | 50,000 | |||||
Term loan facility | 129,796 | 120,006 | ||||
Compensation incurred with affiliate | 14,621 | 15,106 | $ 14,449 | |||
Interest expense, related party | 6,843 | 5,490 | $ 2,414 | |||
Non-controlling interest, ownership percentage | 50.00% | |||||
Affiliate | ||||||
Related Party Transaction [Line Items] | ||||||
Non-controlling interest, ownership percentage | 50.00% | |||||
Promissory Note To Allied | ||||||
Related Party Transaction [Line Items] | ||||||
Promissory note | 25,000 | |||||
Majority Shareholder | Line of Credit | Promissory Note to Majority Shareholder Related Party | ||||||
Related Party Transaction [Line Items] | ||||||
Promissory note | $ 1,000 | $ 3,000 | ||||
Term loan facility | $ 6,400 | |||||
Convertible Debt | 2015 Convertible Note | ||||||
Related Party Transaction [Line Items] | ||||||
Long-term debt, excluding current maturities | 45,000 | |||||
Convertible Subordinated Debt | ||||||
Related Party Transaction [Line Items] | ||||||
Term loan facility | $ 50,000 |
Commitments and Contingencies -
Commitments and Contingencies - Summary of the Company Significant Future Commitments on Non-cancellable Operating Leases and Estimated Obligations Arising from its Minimum Work Obligations (Details) $ in Thousands | Dec. 31, 2016USD ($) |
Commitments And Contingencies [Line Items] | |
Total | $ 272,034 |
2,017 | 125,283 |
2,018 | 49,455 |
2,019 | 48,813 |
2,020 | 48,444 |
2,021 | 39 |
Thereafter | 0 |
Operating lease obligation - FPSO and drilling rig leases - Nigeria | |
Commitments And Contingencies [Line Items] | |
Total | 193,451 |
2,017 | 48,363 |
2,018 | 48,362 |
2,019 | 48,363 |
2,020 | 48,363 |
2,021 | 0 |
Thereafter | 0 |
Operating lease obligation - Office leases | |
Commitments And Contingencies [Line Items] | |
Total | 1,600 |
2,017 | 537 |
2,018 | 493 |
2,019 | 450 |
2,020 | 81 |
2,021 | 39 |
Thereafter | 0 |
Minimum work obligations | Kenya | |
Commitments And Contingencies [Line Items] | |
Total | 65,133 |
2,017 | 65,133 |
2,018 | 0 |
2,019 | 0 |
2,020 | 0 |
2,021 | 0 |
Thereafter | 0 |
Minimum work obligations | The Gambia | |
Commitments And Contingencies [Line Items] | |
Total | 1,200 |
2,017 | 600 |
2,018 | 600 |
2,019 | 0 |
2,020 | 0 |
2,021 | 0 |
Thereafter | 0 |
Minimum work obligations | Ghana | |
Commitments And Contingencies [Line Items] | |
Total | 10,650 |
2,017 | 10,650 |
2,018 | 0 |
2,019 | 0 |
2,020 | 0 |
2,021 | 0 |
Thereafter | $ 0 |
Commitments and Contingencies57
Commitments and Contingencies - Additional Information (Details) $ in Thousands | Aug. 31, 2016USD ($) | Aug. 22, 2016USD ($) | Jul. 29, 2016USD ($) | Mar. 15, 2016 | Feb. 05, 2016people | Dec. 31, 2016USD ($) | Jun. 30, 2015USD ($) | Feb. 28, 2014bbl | Dec. 31, 2016USD ($)contract | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | May 13, 2016USD ($) | Jan. 22, 2016USD ($) |
Commitments And Contingencies Disclosure [Line Items] | |||||||||||||
Rent expense | $ 1,100 | $ 900 | $ 1,000 | ||||||||||
Future minimum payments due | $ 1,600 | 1,600 | |||||||||||
Increase (decrease) in accounts payable and accrued liabilities | 66,147 | 84,000 | $ 56,845 | ||||||||||
Decrease in oil and gas properties | (265,713) | (265,713) | $ (368,891) | ||||||||||
Nigerian Department of Petroleum Resources | |||||||||||||
Commitments And Contingencies Disclosure [Line Items] | |||||||||||||
Payment of cash or the equivalent in shares | 25,000 | $ 25,000 | |||||||||||
Payment of cash or the equivalent of shares in period | 15 days | ||||||||||||
Number of shares to be issued in period | 30 days | ||||||||||||
Kenya | |||||||||||||
Commitments And Contingencies Disclosure [Line Items] | |||||||||||||
Minimum work obligation in mineral property | contract | 4 | ||||||||||||
Write-off of offshore leases | 600 | ||||||||||||
The Gambia | |||||||||||||
Commitments And Contingencies Disclosure [Line Items] | |||||||||||||
Minimum work obligation in mineral property | contract | 2 | ||||||||||||
NIGERIA | |||||||||||||
Commitments And Contingencies Disclosure [Line Items] | |||||||||||||
Estimate of possible loss | 17,100 | $ 17,100 | |||||||||||
Long-term Floating Production Storage and Offloading System Contract | |||||||||||||
Commitments And Contingencies Disclosure [Line Items] | |||||||||||||
Initial term of contract (years) | 7 years | ||||||||||||
Additional term of contract (years) | 2 years | ||||||||||||
Barrels processing capacity (bbl) | bbl | 40,000 | ||||||||||||
Maximum storage capacity for the FPSO (bbl) | bbl | 1,000,000 | ||||||||||||
Reduction of accrued production costs | $ 26,000 | ||||||||||||
Other minimum commitment, due in first year | $ 48,400 | $ 48,400 | |||||||||||
TransOcean Offshore Gulf of Guinea VII Limited and Indigo Drilling Limited [Member] | |||||||||||||
Commitments And Contingencies Disclosure [Line Items] | |||||||||||||
Estimate of possible loss | $ 20,200 | ||||||||||||
February 2014 Transactions | |||||||||||||
Commitments And Contingencies Disclosure [Line Items] | |||||||||||||
Number of plaintiffs | people | 7 | ||||||||||||
Settlement with CEONA Contracting (UK) Limited [Member] | |||||||||||||
Commitments And Contingencies Disclosure [Line Items] | |||||||||||||
Estimate of possible loss | $ 2,900 | ||||||||||||
Increase (decrease) in accounts payable and accrued liabilities | $ (2,700) | ||||||||||||
Decrease in oil and gas properties | $ 2,700 | ||||||||||||
Loss contingency accrual, payments | $ 1,100 | ||||||||||||
Settlement with Contractor Polarcus MC Ltd. [Member] | |||||||||||||
Commitments And Contingencies Disclosure [Line Items] | |||||||||||||
Estimate of possible loss | $ 300 | ||||||||||||
Litigation settlement, amount | 2,400 | ||||||||||||
Loss contingency accrual | $ 400 | ||||||||||||
Convertible Debt | 2015 Convertible Note | |||||||||||||
Commitments And Contingencies Disclosure [Line Items] | |||||||||||||
Percent owed on debt fundraising event | 10.00% | ||||||||||||
Percent owed on equity fundraising event | 20.00% |
Stock Based Compensation - Addi
Stock Based Compensation - Additional Information (Details) - USD ($) | 12 Months Ended | ||||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2018 | Dec. 31, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Common stock expired in period (in shares) | 157,768 | ||||
Common stock forfeited in period (in shares) | 27,052 | ||||
Warrants exercisable from date of issuance, term period (years) | 5 years | ||||
Stock warrants | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Options outstanding intrinsic value | $ 1,000,000 | ||||
Options exercisable intrinsic value | 1,000,000 | ||||
Allocated share-based compensation expense | $ 0 | $ 400,000 | $ 100,000 | ||
Warrants exercisable from date of issuance, term period (years) | 5 years | ||||
Issued warrants to third parties (in shares) | 300,000 | ||||
Issued warrants to third parties at exercise price (in dollars per share) | $ 3.36 | ||||
Granted (shares) | 48,000 | ||||
Restricted common stock forfeited in period (in shares) | 0 | ||||
Expected option term (years) | 3 years | 3 years | 3 years | ||
2009 Equity Incentive Plan | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Number of shares authorized (in shares) | 16,700,000 | ||||
Options outstanding intrinsic value | $ 900,000 | ||||
Options exercisable intrinsic value | 900,000 | ||||
Options exercised in period intrinsic value | $ 700,000 | $ 10,000 | $ 900,000 | ||
Employee Stock Option | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Common stock issued during period (in shares) | 437,638 | ||||
Common stock exercised in period (in shares) | 1,200,000 | ||||
Common stock expired in period (in shares) | 158,000 | ||||
Common stock forfeited in period (in shares) | 27,000 | ||||
Allocated share-based compensation expense | $ 400,000 | $ 1,300,000 | $ 1,300,000 | ||
Compensation cost not yet recognized | $ 300,000 | ||||
Expected option term (years) | 0 years | 3 years | 3 years | ||
Employee Stock Option | Scenario, Forecast | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Compensation cost not yet recognized | $ 100,000 | $ 200,000 | |||
Employee Stock Option | 2009 Equity Incentive Plan | Minimum | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Expiration period (years) | 5 years | ||||
Employee Stock Option | 2009 Equity Incentive Plan | Maximum | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Expiration period (years) | 10 years | ||||
Cashless Stock Option | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Common stock issued during period (in shares) | 246,838 | ||||
Common stock exercised in period (in shares) | 1,008,803 | ||||
Unvested restricted stock awards | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Allocated share-based compensation expense | $ 2,500,000 | $ 3,300,000 | $ 1,700,000 | ||
Compensation cost not yet recognized | $ 1,700,000 | ||||
Granted (shares) | 1,716,000 | ||||
Restricted common stock forfeited in period (in shares) | 89,461 | ||||
Unvested restricted stock awards | Maximum | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Award vesting period (years) | 36 months | ||||
Unvested restricted stock awards | 2009 Equity Incentive Plan | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Grant date fair value vested in period | $ 2,100,000 | $ 3,100,000 | |||
Unvested restricted stock awards | 2009 Equity Incentive Plan | Scenario, Forecast | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Compensation cost not yet recognized | $ 200,000 | $ 1,500,000 | |||
Officer | Performance-Based Restricted Stock | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Granted (shares) | 500,000 | ||||
Award vesting period (years) | 3 years | ||||
Percentage of additional shares awarded | 50.00% | ||||
Compensation not yet recognized, shared-based awards other than options | $ 300,000 | ||||
Cost not yet recognized, period for recognition (years) | 3 years | ||||
2015 Convertible Note | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Number of securities called by warrants (shares) | 48,291 | ||||
2015 Convertible Note | Minimum | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Exercise price of warrants (dollars per share) | $ 2 | ||||
2015 Convertible Note | Maximum | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Exercise price of warrants (dollars per share) | $ 2.13 |
Stock Based Compensation - Summ
Stock Based Compensation - Summary of Stock Option Activity (Details) - $ / shares | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | ||
Forfeited (shares) | (27,052) | |
Expired (shares) | (157,768) | |
Stock Options | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | ||
Options, Outstanding (shares) | 2,532,000 | |
Granted (shares) | 0 | |
Exercised (shares) | (1,200,000) | |
Forfeited (shares) | (27,000) | |
Expired (shares) | (158,000) | |
Options, Outstanding (shares) | 1,147,000 | 2,532,000 |
Expected to vest (shares) | 908,000 | |
Exercisable at end of period (shares) | 239,000 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Abstract] | ||
Options Outstanding, Weighted-Average Exercise Price (dollars per share) | $ 2.29 | |
Granted (dollars per share) | 0 | |
Exercised (dollars per share) | 1.84 | |
Forfeited (dollars per share) | 3.42 | |
Expired (dollars per share) | 3.70 | |
Options Outstanding, Weighted-Average Exercise Price (dollars per share) | 2.54 | $ 2.29 |
Expected to vest (dollars per share) | 2.21 | |
Exercisable at end of period (dollars per share) | $ 3.79 | |
Options Outstanding, Weighted-Average Remaining Contractual Term (Years) | 2 years | 1 year 7 months 6 days |
Expected to vest, Weighted-Average Remaining Contractual Term (Years) | 1 year 7 months 6 days | |
Exercisable at end of period, Weighted-Average Remaining Contractual Term (Years) | 3 years 4 months 24 days |
Stock Based Compensation - Su60
Stock Based Compensation - Summary of Weighted-Average Amounts for Assumptions (Details) - $ / shares | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Stock warrants | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected price volatility (percent) | 82.70% | ||
Expected price volatility, minimum | 84.70% | 76.80% | |
Expected price volatility, maximum | 84.80% | 83.20% | |
Risk free interest rate (U.S. Treasury bonds) (percent) | 0.80% | 1.10% | |
Risk free interest rate (U.S. Treasury bonds), minimum | 0.80% | ||
Risk free interest rate (U.S. Treasury bonds), maximum | 1.10% | ||
Expected annual dividend yield (percent) | 0.00% | 0.00% | 0.00% |
Expected option term (years) | 3 years | 3 years | 3 years |
Weighted-average grant date fair value per share (dollars per share) | $ 1.12 | $ 1.86 | $ 1.80 |
Stock Options | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected price volatility (percent) | 0.00% | 87.70% | |
Expected price volatility, minimum | 77.10% | ||
Expected price volatility, maximum | 83.10% | ||
Risk free interest rate (U.S. Treasury bonds) (percent) | 0.00% | 1.10% | |
Risk free interest rate (U.S. Treasury bonds), minimum | 1.00% | ||
Risk free interest rate (U.S. Treasury bonds), maximum | 1.20% | ||
Expected annual dividend yield (percent) | 0.00% | 0.00% | 0.00% |
Expected option term (years) | 0 years | 3 years | 3 years |
Weighted-average grant date fair value per share (dollars per share) | $ 0 | $ 2.73 | $ 1.92 |
Stock Based Compensation - Su61
Stock Based Compensation - Summary of Stock Warrants Activity (Details) - Stock warrants - $ / shares | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | ||
Outstanding (shares) | 2,935,000 | |
Granted (shares) | 48,000 | |
Exercised (shares) | 0 | |
Forfeited (shares) | 0 | |
Expired (shares) | 0 | |
Outstanding (shares) | 2,983,000 | 2,935,000 |
Expected to vest (shares) | 0 | |
Exercisable at period end (shares) | 2,983,000 | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract] | ||
Outstanding (dollars per share) | $ 3.61 | |
Granted (dollars per share) | 2.07 | |
Exercised (dollars per share) | 0 | |
Forfeited (dollars per share) | 0 | |
Expired (dollars per share) | 0 | |
Outstanding (dollars per share) | 3.59 | $ 3.61 |
Expected to vest (dollars per share) | 0 | |
Exercisable at period end (dollars per share) | $ 3.59 | |
Weighted-Average Remaining Contractual Term (Years) | 3 years 2 months 12 days | 4 years 2 months 12 days |
Granted, Weighted-Average Remaining Contractual Term (Years) | 4 years 4 months 2 days | |
Exercisable at period end, Weighted-Average Remaining Contractual Term (Years) | 3 years 2 months 12 days |
Stock Based Compensation - Su62
Stock Based Compensation - Summary of Restricted Stock Activity (Details) - Unvested restricted stock awards | 12 Months Ended |
Dec. 31, 2016$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | |
Outstanding (shares) | shares | 1,114,000 |
Granted (shares) | shares | 1,716,000 |
Vested (shares) | shares | (669,000) |
Forfeited (shares) | shares | (89,461) |
Outstanding (shares) | shares | 2,072,000 |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract] | |
Outstanding (dollars per share) | $ / shares | $ 3.21 |
Granted (dollars per share) | $ / shares | 2.16 |
Vested (dollars per share) | $ / shares | 3.56 |
Forfeited (dollars per share) | $ / shares | 2.59 |
Outstanding (dollars per share) | $ / shares | $ 2.25 |
Income Taxes - Reconciliation o
Income Taxes - Reconciliation of Expected Statutory U.S. Federal Income Tax Provision (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Income Tax [Line Items] | |||||||||||
Net loss attributable to Erin Energy Corporation before income tax expense | $ (63,947) | $ (23,471) | $ (22,572) | $ (32,411) | $ (330,034) | $ (58,682) | $ (9,162) | $ (33,059) | $ (142,401) | $ (430,937) | $ (96,062) |
Expected income tax provision at statutory rate of 35% | (49,840) | (150,828) | (33,622) | ||||||||
Increase (decrease) due to: | |||||||||||
Foreign rate differential | (17,202) | (59,467) | (10,083) | ||||||||
Change in valuation allowance | 71,148 | 256,910 | 98,376 | ||||||||
Non-deductible expenses and other | (6,097) | (11,035) | (13,906) | ||||||||
Total income tax expense | $ 0 | $ 0 | $ 0 | ||||||||
Expected income tax provision at statutory rate | 35.00% | 35.00% | 35.00% | ||||||||
NIGERIA | |||||||||||
Increase (decrease) due to: | |||||||||||
Investment tax credit - Nigeria | $ 1,991 | $ (35,580) | $ (40,765) |
Income Taxes - Significant Comp
Income Taxes - Significant Components of Deferred Tax Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Income Tax Disclosure [Abstract] | ||
Basis difference in fixed assets | $ (3,249) | $ 11,893 |
Unused capital allowances | 572,051 | 506,795 |
Net operating losses | 109,230 | 88,391 |
Other | 12,421 | 12,226 |
Gross deferred income tax assets | 690,453 | 619,305 |
Valuation allowance | (690,453) | (619,305) |
Net deferred income tax assets | $ 0 | $ 0 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Income Tax Disclosure [Abstract] | ||
Valuation allowance | $ 690,453 | $ 619,305 |
Income Taxes - Summary of Tax Y
Income Taxes - Summary of Tax Years Remain Subject to Examination (Details) | 12 Months Ended |
Dec. 31, 2016 | |
United States | Minimum | |
Income Tax Examination [Line Items] | |
Tax years subject to examination | 2,007 |
United States | Maximum | |
Income Tax Examination [Line Items] | |
Tax years subject to examination | 2,016 |
NIGERIA | Minimum | |
Income Tax Examination [Line Items] | |
Tax years subject to examination | 2,010 |
NIGERIA | Maximum | |
Income Tax Examination [Line Items] | |
Tax years subject to examination | 2,016 |
Kenya | Minimum | |
Income Tax Examination [Line Items] | |
Tax years subject to examination | 2,012 |
Kenya | Maximum | |
Income Tax Examination [Line Items] | |
Tax years subject to examination | 2,016 |
The Gambia | Minimum | |
Income Tax Examination [Line Items] | |
Tax years subject to examination | 2,012 |
The Gambia | Maximum | |
Income Tax Examination [Line Items] | |
Tax years subject to examination | 2,016 |
Segment Information - Segment A
Segment Information - Segment Activity (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Segment Reporting Information [Line Items] | |||||||||||
Revenues | $ 21,116 | $ 28,619 | $ 23,151 | $ 4,929 | $ 39,762 | $ 28,667 | $ 0 | $ 0 | $ 77,815 | $ 68,429 | $ 53,844 |
Operating loss | (59,683) | $ (21,817) | $ (27,199) | $ (28,293) | (325,158) | $ (53,423) | $ (5,821) | $ (32,031) | (136,992) | (416,433) | (93,325) |
Total Assets | 289,201 | 395,159 | 289,201 | 395,159 | |||||||
Operating Segments | Nigeria Segment | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenues | 77,815 | 68,429 | 53,844 | ||||||||
Operating loss | (119,346) | (387,448) | (64,716) | ||||||||
Total Assets | 281,050 | 387,326 | 281,050 | 387,326 | |||||||
Operating Segments | Kenya Segment | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenues | 0 | 0 | 0 | ||||||||
Operating loss | (2,569) | (8,038) | (12,130) | ||||||||
Total Assets | 698 | 1,399 | 698 | 1,399 | |||||||
Operating Segments | The Gambia Segment | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenues | 0 | 0 | 0 | ||||||||
Operating loss | (1,570) | (5,209) | (1,347) | ||||||||
Total Assets | 3,034 | 3,016 | 3,034 | 3,016 | |||||||
Operating Segments | Ghana Segment | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Operating loss | (1,677) | (1,931) | (492) | ||||||||
Total Assets | 3,648 | 2,447 | 3,648 | 2,447 | |||||||
Corporate and Other | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenues | 0 | 0 | 0 | ||||||||
Operating loss | (11,830) | (13,807) | $ (14,640) | ||||||||
Total Assets | $ 771 | $ 971 | $ 771 | $ 971 |
Selected Unaudited Quarterly 68
Selected Unaudited Quarterly Financial Data - Schedule of Selected Unaudited Quarterly Financial Data (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Quarterly Financial Information Disclosure [Abstract] | |||||||||||
Revenues | $ 21,116 | $ 28,619 | $ 23,151 | $ 4,929 | $ 39,762 | $ 28,667 | $ 0 | $ 0 | $ 77,815 | $ 68,429 | $ 53,844 |
Operating loss | (59,683) | (21,817) | (27,199) | (28,293) | (325,158) | (53,423) | (5,821) | (32,031) | (136,992) | (416,433) | (93,325) |
Net loss attributable to Erin Energy Corporation | $ (63,947) | $ (23,471) | $ (22,572) | $ (32,411) | $ (330,034) | $ (58,682) | $ (9,162) | $ (33,059) | $ (142,401) | $ (430,937) | $ (96,062) |
Net loss per common share attributable to Erin Energy Corporation | |||||||||||
Basic (Dollars per share) | $ (0.30) | $ (0.11) | $ (0.11) | $ (0.15) | $ (1.56) | $ (0.28) | $ (0.04) | $ (0.16) | |||
Diluted (Dollars per share) | $ (0.30) | $ (0.11) | $ (0.11) | $ (0.15) | $ (1.56) | $ (0.28) | $ (0.04) | $ (0.16) |
Correction of Immaterial Erro69
Correction of Immaterial Error in Previously Issued Consolidated Financial Statements (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||||||||||
Oil and gas properties, net | $ 265,713 | $ 368,891 | $ 265,713 | $ 368,891 | ||||||||
Total property, plant and equipment, net | 266,429 | 370,065 | 266,429 | 370,065 | ||||||||
Accumulated deficit | (1,018,292) | (875,891) | (1,018,292) | (875,891) | ||||||||
Total capital deficiency | (224,620) | (85,267) | (224,620) | (85,267) | $ 334,005 | $ 387,946 | ||||||
Impairment of oil and gas properties | 645 | 261,208 | 0 | |||||||||
Total operating costs and expenses | 214,807 | 484,862 | 147,169 | |||||||||
Net loss attributable to Erin Energy Corporation | (63,947) | $ (23,471) | $ (22,572) | $ (32,411) | (330,034) | $ (58,682) | $ (9,162) | $ (33,059) | (142,401) | $ (430,937) | (96,062) | |
Basic and diluted loss per share attributable to Erin Energy Corporation (USD per share) | $ (2.04) | |||||||||||
Net loss | (143,242) | $ (431,899) | (96,308) | |||||||||
Scenario, Previously Reported | ||||||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||||||||||
Oil and gas properties, net | 348,331 | 348,331 | ||||||||||
Total property, plant and equipment, net | 349,505 | 349,505 | ||||||||||
Accumulated deficit | (896,451) | (896,451) | ||||||||||
Total capital deficiency | (105,827) | (105,827) | ||||||||||
Impairment of oil and gas properties | 281,768 | |||||||||||
Total operating costs and expenses | 505,422 | |||||||||||
Net loss attributable to Erin Energy Corporation | $ (451,497) | |||||||||||
Basic and diluted loss per share attributable to Erin Energy Corporation (USD per share) | $ (2.13) | |||||||||||
Net loss | $ (452,459) | |||||||||||
Restatement Adjustment | ||||||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||||||||||
Oil and gas properties, net | 20,560 | 20,560 | ||||||||||
Total property, plant and equipment, net | 20,560 | 20,560 | ||||||||||
Accumulated deficit | 20,560 | 20,560 | ||||||||||
Total capital deficiency | 20,560 | 20,560 | ||||||||||
Impairment of oil and gas properties | (20,560) | |||||||||||
Total operating costs and expenses | (20,560) | |||||||||||
Net loss attributable to Erin Energy Corporation | $ 20,560 | |||||||||||
Basic and diluted loss per share attributable to Erin Energy Corporation (USD per share) | $ 0.09 | |||||||||||
Net loss | $ 20,560 | |||||||||||
Accumulated Deficit | ||||||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||||||||||
Total capital deficiency | $ (1,018,292) | (875,891) | (1,018,292) | (875,891) | (444,954) | $ (348,892) | ||||||
Net loss | $ (142,401) | (430,937) | $ (96,062) | |||||||||
Accumulated Deficit | Restatement Adjustment | ||||||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||||||||||
Total capital deficiency | $ 20,600 | $ 20,600 |
Subsequent Events - Additional
Subsequent Events - Additional Information (Details) | Mar. 15, 2017USD ($)well | Feb. 06, 2017USD ($) | Mar. 06, 2017 | Feb. 28, 2017USD ($) | Mar. 15, 2017USD ($)shares | Dec. 31, 2016shares |
Cashless Stock Option | ||||||
Subsequent Event [Line Items] | ||||||
Common stock issued during period (in shares) | 246,838 | |||||
Unvested restricted stock awards | ||||||
Subsequent Event [Line Items] | ||||||
Equity instrument other than options, grants in the period (shares) | 1,716,000 | |||||
Officer | Performance-Based Restricted Stock | ||||||
Subsequent Event [Line Items] | ||||||
Equity instrument other than options, grants in the period (shares) | 500,000 | |||||
Subsequent Event | Cashless Stock Option | ||||||
Subsequent Event [Line Items] | ||||||
Common stock issued during period (in shares) | 31,841 | |||||
Subsequent Event | Unvested restricted stock awards | ||||||
Subsequent Event [Line Items] | ||||||
Equity instrument other than options, grants in the period (shares) | 400,000 | |||||
Subsequent Event | Glencore Energy UK Ltd. | ||||||
Subsequent Event [Line Items] | ||||||
Proceeds from advance | $ | $ 13,600,000 | |||||
Subsequent Event | Glencore Energy UK Ltd. | London Interbank Offered Rate (LIBOR) | ||||||
Subsequent Event [Line Items] | ||||||
Advance interest rate spread | 6.50% | |||||
Subsequent Event | Officer | Performance-Based Restricted Stock | ||||||
Subsequent Event [Line Items] | ||||||
Equity instrument other than options, grants in the period (shares) | 200,000 | |||||
Line of Credit | MCB Finance Facility | Subsequent Event | ||||||
Subsequent Event [Line Items] | ||||||
Maximum borrowing capacity | $ | $ 100,000,000 | |||||
Debt instrument, fee, dividend multiplier percentage for warrants issued | 20.00% | |||||
Upfront fee | 2.50% | |||||
Line of Credit | MCB Finance Facility | Subsequent Event | 3-month London Interbank Offered Rate (LIBOR) | ||||||
Subsequent Event [Line Items] | ||||||
Debt instrument, basis spread on variable rate (percent) | 6.00% | |||||
Line of Credit | MCB Finance Facility | EPNL | Subsequent Event | ||||||
Subsequent Event [Line Items] | ||||||
Deposit requirement | $ | $ 10,000,000 | |||||
Line of Credit | MCB Finance Facility | Bank Guarantee | South African Public Investment Corporation | Subsequent Event | ||||||
Subsequent Event [Line Items] | ||||||
Bank guarantee amount | $ | $ 100,000,000 | |||||
Pacific Bora Drilling Rig | Subsequent Event | ||||||
Subsequent Event [Line Items] | ||||||
Number of wells with option to drill | well | 2 | |||||
Base operating rate per day | $ | $ 195,000 | $ 195,000 | ||||
Pacific Bora Drilling Rig | Nigeria | Subsequent Event | ||||||
Subsequent Event [Line Items] | ||||||
Number of wells with option to drill | well | 2 |