Document_And_Entity_Informatio
Document And Entity Information | 3 Months Ended | |
Mar. 31, 2014 | 6-May-14 | |
Document and Entity Information [Abstract] | ' | ' |
Entity Registrant Name | 'CAMAC Energy Inc. | ' |
Document Type | '10-Q | ' |
Current Fiscal Year End Date | '--12-31 | ' |
Entity Common Stock, Shares Outstanding | ' | 1,259,844,291 |
Amendment Flag | 'false | ' |
Entity Central Index Key | '0001402281 | ' |
Entity Filer Category | 'Accelerated Filer | ' |
Document Period End Date | 31-Mar-14 | ' |
Document Fiscal Year Focus | '2014 | ' |
Document Fiscal Period Focus | 'Q1 | ' |
CONSOLIDATED_BALANCE_SHEETS
CONSOLIDATED BALANCE SHEETS (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Current assets: | ' | ' |
Cash and cash equivalents | $36,235 | $163 |
Accounts receivable | 4,154 | 1,112 |
Crude oil inventory | 8,927 | 6,787 |
Prepaids and other current assets | 7,031 | 856 |
Total current assets | 56,347 | 8,918 |
Property, plant and equipment: | ' | ' |
Oil and gas properties (successful efforts method of accounting), net | 433,721 | 436,471 |
Other property, plant and equipment, net | 955 | 752 |
Total property, plant and equipment, net | 434,676 | 437,223 |
Other assets | 52 | 52 |
Total Assets | 491,075 | 446,193 |
Current liabilities: | ' | ' |
Accounts payable | 35,475 | 31,668 |
Accrued expenses | 10,999 | 7,446 |
Asset retirement obligations | 12,751 | 12,479 |
Note payable - related party | 92,147 | 6,496 |
Total current liabilities | 151,372 | 58,089 |
Asset retirement obligations | 8,291 | 8,122 |
Long-term note payable - related party | 50,000 | ' |
Other long-term liabilities | 68 | 67 |
Total liabilities | 209,731 | 66,278 |
Equity: | ' | ' |
Preferred stock $0.001 par value - 50,000,000 shares authorized; zero issued and outstanding at March 31, 2014 and December 31, 2013 | ' | ' |
Common stock $0.001 par value - 2,500,000,000 shares authorized; 1,070,430,276 and 382,362,236 shares issued and outstanding as of March 31, 2014 and December 31, 2013 | 1,070 | 382 |
Paid-in capital | 638,365 | 732,985 |
Accumulated deficit | -358,091 | -353,452 |
Total equity | 281,344 | 379,915 |
Total liabilities and equity | $491,075 | $446,193 |
CONSOLIDATED_BALANCE_SHEETS_Pa
CONSOLIDATED BALANCE SHEETS (Parentheticals) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
Preferred stock par value (in Dollars per share) | $0.00 | $0.00 |
Preferred stock, authorized shares | 50,000,000 | 50,000,000 |
Preferred stock, issued shares | 0 | 0 |
Preferred stock, outstanding shares | 0 | 0 |
Common stock, par value (in Dollars per share) | $0.00 | $0.00 |
Common stock, authorized shares | 2,500,000,000 | 2,500,000,000 |
Common stock, issued shares | 1,070,430,276 | 382,362,236 |
Common stock, outstanding shares | 1,070,430,276 | 382,362,236 |
CONSOLIDATED_STATEMENTS_OF_OPE
CONSOLIDATED STATEMENTS OF OPERATIONS (USD $) | 3 Months Ended | |
In Thousands, except Per Share data, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Revenues: | ' | ' |
Oil and gas revenue | $19,894 | $22,006 |
Operating costs and expenses: | ' | ' |
Production costs | 12,678 | 19,658 |
Exploratory expenses | 2,276 | 1,198 |
Depreciation, depletion and amortization | 4,971 | 5,467 |
General and administrative expenses | 4,433 | 3,712 |
Total operating costs and expenses | 24,358 | 30,035 |
Operating loss | -4,464 | -8,029 |
Other income (expense): | ' | ' |
Interest expense | -185 | -4 |
Other, net | 10 | ' |
Total other income (expense) | -175 | -4 |
Loss before income taxes | -4,639 | -8,033 |
Income tax expense | ' | ' |
Net loss | ($4,639) | ($8,033) |
Net (loss) income per common share: | ' | ' |
Basic | ($0.01) | ($0.02) |
Diluted | ($0.01) | ($0.02) |
Weighted average common shares outstanding: | ' | ' |
Basic | 676,927 | 379,880 |
Diluted | 676,927 | 379,880 |
CONSOLIDATED_STATEMENTS_OF_EQU
CONSOLIDATED STATEMENTS OF EQUITY (USD $) | Total | Common Stock | Additional Paid-in Capital | Accumulated Deficit |
In Thousands | ||||
Balance at Dec. 31, 2013 | $379,915 | $382 | $732,985 | ($353,452) |
Common stock issued | 135,416 | 688 | 134,728 | ' |
Stock-based employee compensation | 507 | ' | 507 | ' |
Net loss | -4,639 | ' | ' | -4,639 |
Allied acquisition | -229,855 | ' | -229,855 | ' |
Balance at Mar. 31, 2014 | $281,344 | $1,070 | $638,365 | ($358,091) |
CONSOLIDATED_STATEMENTS_OF_CAS
CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Cash flows from operating activities | ' | ' |
Net loss | ($4,639) | ($8,033) |
Adjustments to reconcile net loss to cash used in operating activities: | ' | ' |
Depreciation, depletion and amortization | 4,531 | 4,926 |
Asset retirement obligation accretion | 440 | 541 |
Stock-based compensation | 507 | 338 |
Acquisition adjustments | -9,855 | 1,591 |
Other | ' | 1 |
Changes in operating assets and liabilities: | ' | ' |
(Increase) decrease in accounts receivable | -3,042 | -348 |
(Increase) decrease in inventories | -2,098 | -1,422 |
(Increase) decrease in other current assets | -6,175 | 39 |
Increase (decrease) in accounts payable and accrued liabilities | 7,388 | 1,245 |
Net cash used in operating activities | -12,943 | -1,122 |
Cash flows from investing activities | ' | ' |
Capital expenditures | -2,050 | -352 |
Acquisition - related party | -85,000 | ' |
Net cash used in investing activities | -87,050 | -352 |
Cash flows from financing activities | ' | ' |
Proceeds from issuance of common stock | 135,000 | ' |
Proceeds from note payable - related party | 650 | ' |
Proceeds from exercise of stock options | 415 | ' |
Net cash provided by financing activities | 136,065 | ' |
Net increase (decrease) in cash and cash equivalents | 36,072 | -1,474 |
Cash and cash equivalents at beginning of period | 163 | 3,806 |
Cash and cash equivalents at end of period | 36,235 | 2,332 |
Cash paid for: | ' | ' |
Interest, net | $8 | $4 |
Company_Description
Company Description | 3 Months Ended |
Mar. 31, 2014 | |
Company Description | ' |
1. Company Description | |
CAMAC Energy, Inc. (NYSE MKT: CAK, JSE: CME) 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 nine licenses in four countries covering an area of approximately 43,000 square kilometers (approximately 10 million acres). The Company has producing properties and conducts exploration activities in Nigeria, as well as explorations licenses with significant hydrocarbon potential onshore and offshore Kenya, offshore The Gambia and offshore Ghana. | |
The Company’s corporate headquarters is located in Houston, Texas. In addition, the Company has offices in Nairobi, Kenya, Banjul, The Gambia and Lagos, Nigeria. | |
The Company’s operating subsidiaries are CAMAC Energy Limited, CAMAC Petroleum Limited (“CPL”), CAMAC Energy International Limited, CAMAC Energy Ghana Limited, CAMAC Energy Kenya Limited, CAMAC Energy Gambia A5 Limited and CAMAC Energy Gambia A2 Limited. The terms “we,” “us,” “our,” “Company,” and “our Company” refer to CAMAC and its subsidiaries and affiliates. | |
The Company’s related parties include CAMAC Energy Holdings Limited (“CEHL”), CAMAC International Nigeria Limited, CAMAC International Limited and Allied Energy Plc. (“Allied”). |
Basis_of_Presentation_and_Rece
Basis of Presentation and Recently Issued Accounting Standards | 3 Months Ended |
Mar. 31, 2014 | |
Basis of Presentation and Recently Issued Accounting Standards | ' |
2. Basis of Presentation and Recently Issued Accounting Standards | |
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”) and 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 which 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. This Form 10-Q should be read in conjunction with our audited consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2013. | |
In February 2014, the Company completed the acquisition of the remaining economic interests that it did not already own in the Production Sharing Contract (“PSC”) covering Oil Mining Leases 120 and 121 (“OMLs 120 and 121”) offshore Nigeria, which include the currently producing Oyo Field (the “Allied Assets”), from Allied (the “Allied Transaction”). Allied is a subsidiary of CEHL, the Company’s majority shareholder and deemed to be under common control (transactions between subsidiaries of the same parent). Accordingly, the net assets acquired from Allied were recorded at their respective carrying values as of the acquisition date. The financial statements presented for all periods included herein are presented as though the transfer of the Allied assets had occurred at the beginning of the first period presented. | |
Recently Issued Accounting Standards | |
In April 2014, the Financial Accounting Standards Board (“FASB”) issued updated guidance that changes the criteria for reporting discontinued operations including enhanced disclosure requirements. Under the new guidance, only disposals representing a strategic shift in operations should be presented as discontinued operations. Those strategic shifts should have a major effect on the organization´s operations and financial results. The standards update is effective for fiscal years beginning after December 15, 2014. We will adopt this standards update, as required, beginning with the first quarter of 2015. The adoption of this standards update affects presentation only and, as such, is not expected to have a material impact on our consolidated financial statements. | |
Acquisitions
Acquisitions | 3 Months Ended | ||||
Mar. 31, 2014 | |||||
Acquisitions | ' | ||||
3. Acquisitions | |||||
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 $85.0 million in cash to Allied, issued 497,454,857 shares of the Company’s common stock to Allied and delivered a $50.0 million Convertible Subordinated Note (the “Convertible Subordinated Note”) to Allied under which $25.0 million was deemed to be advanced. | |||||
To fund the cash portion of the Allied Transaction and a portion of the anticipated capital expenditures for 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 registered and duly incorporated in the Republic of South Africa (“PIC”), for an aggregate cash investment of $270.0 million through a private placement of 376,884,422 shares of common stock (the “Private Placement”). The Share Purchase Agreement provides that the Private Placement will be completed in two installments. The first installment of $135.0 million (the “First Closing”) in exchange for 188,442,211 shares of the Company’s common stock was completed at the closing of the Allied Transaction. The second installment (the “Second Closing”) of $135.0 million in exchange for 188,442,211 shares of the Company’s common stock was completed in May 2014. | |||||
Following the Second Closing with the PIC, the Company was required to pay to Allied the additional $85.0 million in cash, and the additional $25.0 million was deemed to be advanced to Allied under the Convertible Subordinated Note. | |||||
The contractual purchase consideration to be paid and the assets acquired and liabilities assumed are as follows (In thousands): | |||||
Cash consideration paid upon First Closing | $ | 85,000 | |||
Cash consideration to be paid upon Second Closing | 85,000 | ||||
CAMAC common stock | - | ||||
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 | 249,739 | ||||
Accounts payable | (25,429 | ) | |||
Asset retirement obligations | (20,890 | ) | |||
Net assets acquired | 203,420 | ||||
Consideration in excess of carrying value acquired | $ | 16,580 | |||
The Allied Transaction is being accounted for as a transfer of entities under common control, whereby the net assets acquired are combined with the Company’s assets at their historical amounts. Since the cash and debt consideration exceeds the carrying cost of the assets acquired, no value was assigned to the shares issued. | |||||
Property_and_Equipment
Property and Equipment | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Property, Plant and Equipment | ' | |||||||
4. Property and Equipment | ||||||||
Property, plant and equipment is comprised of the following: | ||||||||
March 31, | December 31, | |||||||
2014 | 2013 | |||||||
(In thousands) | ||||||||
Wells and production facilities | $ | 28,874 | $ | 28,874 | ||||
Proved properties | 386,196 | 386,196 | ||||||
Warehouse inventory | 25,429 | 25,429 | ||||||
Work in progress | 63,958 | 62,208 | ||||||
Oilfield assets | 504,457 | 502,707 | ||||||
Accumulated depletion | (78,976 | ) | (74,476 | ) | ||||
Oilfield assets, net | 425,481 | 428,231 | ||||||
Unevaluated leaseholds | 8,240 | 8,240 | ||||||
Oil and gas properties, net | 433,721 | 436,471 | ||||||
Other property and equipment | 1,866 | 1,590 | ||||||
Accumulated depreciation | (911 | ) | (838 | ) | ||||
Other property and equipment, net | 955 | 752 | ||||||
Total property, plant and equipment, net | $ | 434,676 | $ | 437,223 | ||||
Suspended_Exploratory_Well_Cos
Suspended Exploratory Well Costs | 3 Months Ended |
Mar. 31, 2014 | |
Suspended Exploratory Well Costs | ' |
5. Suspended Exploratory Well Costs | |
In November 2013, the Company achieved both its primary and secondary drilling objectives for the Oyo-7 well. The primary drilling objective was to establish production from the existing Pliocene reservoir. The secondary drilling objective confirmed the presence of hydrocarbons in the Miocene formation. Hydrocarbons were encountered in three intervals totaling approximately 65 feet, as interpreted by the logging while drilling (“LWD”) data. Management is making plans to further explore the Miocene formation. As of March 31, 2014, the Company has capitalized $26.9 million for the costs related to the Miocene exploratory drilling activities. | |
Asset_Retirement_Obligations
Asset Retirement Obligations | 3 Months Ended | |||
Mar. 31, 2014 | ||||
Asset Retirement Obligations | ' | |||
6. 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 our 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 are calculated based on historical data as well as current estimated costs. The following summarizes changes in the Company’s asset retirement obligations during the three months ended March 31, 2014: | ||||
2014 | ||||
(In thousands) | ||||
Carrying amount at January 1 | $ | 20,601 | ||
Accretion expense | 440 | |||
Carrying amount at March 31 | $ | 21,041 | ||
Accretion expense is recognized as a component of depreciation, depletion and amortization expense in the accompanying statements of operations. |
Debt
Debt | 3 Months Ended |
Mar. 31, 2014 | |
Debt | ' |
7. Debt | |
Note Payable – Related Party | |
Promissory Note | |
In June 2011, CPL, a wholly owned subsidiary of the Company, executed a $25.0 million Promissory Note (the “Promissory Note”) in favor of Allied. Interest accrues on the outstanding principal under the Promissory Note at a rate of the 30 day London Interstate Bank Offered Rate (“LIBOR”) plus 2% per annum. The Promissory Note is set to mature and become due July 2014. In January 2014, Allied agreed to amend the Promissory Note and extend the maturity date to July 2015 in the event the Company is not successful in obtaining external financing by June 2014. The Company has guaranteed all of CPL’s obligations under the Promissory Note. As of March 31, 2014, $7.1 million was outstanding under the Promissory Note. | |
Allied Transaction | |
Included in the note payable – related party is $85.0 million due to Allied for the remaining cash consideration upon the Second Closing of the Private Placement with PIC. See Note 3 – Acquisitions, for details relating to the Allied Transaction. | |
Long-Term Note Payable – Related Party | |
As partial consideration in connection with the February 2014 closing of the Allied Transaction, the Company issued the $50.0 million Convertible Subordinated Note in favor of Allied. The principal of the Convertible Subordinated Note was deemed advanced in two equal $25.0 million tranches at each of the First Closing and the Second Closing of the Private Placement. Interest on the Convertible Subordinated Note accrues at a rate per annum of one-month LIBOR plus 5%, payable quarterly in cash until the maturity of the Convertible Subordinated Note five years from the closing of the Allied Transaction. At the election of the holder, the Convertible Subordinated Note will be convertible into shares of the Company’s common stock at an initial conversion price of $0.7164 per share, subject to customary anti-dilution adjustments. The 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 Convertible Subordinated Note). The Company may, at its option prepay the note, in whole or in part, at any time, without premium or penalty. The 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 Convertible Subordinated Note to any person upon written notice to the Company. |
ShareBased_Compensation
Share-Based Compensation | 3 Months Ended |
Mar. 31, 2014 | |
Share-Based Compensation | ' |
8. Share-Based Compensation | |
During the three months ended March 31, 2014, the Company issued 710,196 shares of common stock as a result of the vesting of restricted stock awards. During the three months ended March 31, 2014, the Company granted employees a total of 3,670,735 shares of restricted stock and options to purchase a total of 2,023,914 shares of common stock, with vesting periods from 24 months to 36 months. | |
Earnings_Loss_Per_Common_Share
Earnings (Loss) Per Common Share | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Earnings (Loss) Per Common Share | ' | ||||||||
9. Earnings (Loss) Per Common Share | |||||||||
Basic earnings (loss) per common share are computed by dividing net income (loss) available to common stockholders by the weighted-average number of common shares outstanding for the period. The weighted average number of common shares outstanding for computing basic and diluted earnings (loss) per common share for the three months ended March 31, 2014 and 2013 were as follows: | |||||||||
Three Months Ended March 31, | |||||||||
2014 | 2013 | ||||||||
(In thousands) | |||||||||
Basic | 676,927 | 379,880 | |||||||
Diluted | 676,927 | 379,880 | |||||||
The number of stock options and restricted stock awards that were excluded from dilutive shares outstanding as these potentially dilutive securities are anti-dilutive because the Company was in a loss position for the three months ended March 31, 2014 and 2013 were as follows: | |||||||||
Three Months Ended March 31, | |||||||||
2014 | 2013 | ||||||||
(In thousands) | |||||||||
Stock options | 7,433 | 353 | |||||||
Nonvested restricted stock awards | 7,500 | 1,561 | |||||||
14,933 | 1,914 | ||||||||
Financial_Instruments_and_Fair
Financial Instruments and Fair Value Measurements | 3 Months Ended |
Mar. 31, 2014 | |
Financial Instruments and Fair Value Measurements | ' |
10. Financial Instruments and Fair Value Measurements | |
The carrying amounts of the Company’s financial instruments, which include cash and cash equivalents, trade receivables, inventory, accounts payable, accrued expenses, other long-term liabilities and debt at floating interest rates approximate their fair values at March 31, 2014, principally due to the short-term nature, maturities or nature of interest rates of the above listed items. |
Commitments_and_Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2014 | |
Commitments and Contingencies | ' |
11. Commitments and Contingencies | |
Commitments | |
In January 2014, a long-term drilling contract was signed for the drillship Energy Searcher. The rig is expected to be delivered to the Oyo Field in OML 120 in May 2014 to commence the planned Oyo Field development campaign. The agreement covers an initial term of one year, with an option to extend the contract for an additional one year. The minimum commitment pursuant to the initial term of the agreement is approximately $86.0 million. | |
In February 2014, a long-term contract was signed for the floating, production, storage, and offloading system (“FPSO”) Armada Perdana, the vessel that is currently connected to the Company’s producing wells Oyo-5 and Oyo-6 in OML 120. 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. The annual minimum commitment per the terms of the agreement is approximately $35.0 million in the first year and approximately $48.0 million thereafter. | |
The Company has substantial commitments related to four production sharing contracts with the Government of the Republic of Kenya (the “Kenya PSCs”) and two Petroleum Exploration, Development & Production Licenses with the Republic of The Gambia (the “Gambia Licenses”), in each case entered into by the Company through a wholly owned subsidiary. To maintain compliance and ownership, the Company is and will be required to fulfill minimum work obligations and to make certain payments as stated in each of the Kenya PSCs and The Gambia Licenses. | |
Legal Proceedings | |
From time to time we may be involved in various legal proceedings and claims in the ordinary course of our business. As of March 31, 2014, and through the filing date of this report, we do not believe the ultimate resolution of such actions or potential actions of which we are currently aware will have a material effect on our consolidated financial position or our results of operations. |
Related_Party_Transactions
Related Party Transactions | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Related Party Transactions | ' | |||||||
12. Related Party Transactions | ||||||||
The Company has transactions in the normal course of business with its shareholders, CEHL and their affiliates. The following table summarizes related party transactions for the respective periods: | ||||||||
March 31, | December 31, | |||||||
2014 | 2013 | |||||||
(In thousands) | ||||||||
Accounts receivable | $ | 4,154 | $ | 1,026 | ||||
Other current assets | $ | 624 | $ | 624 | ||||
Accounts payable and accrued expenses | $ | 27,047 | $ | 25,721 | ||||
Note payable-related party | $ | 92,147 | $ | 6,496 | ||||
Long-term note payable-related party | $ | 50,000 | $ | - | ||||
The Company was owed $4.2 million and $1.0 million as of March 31, 2014 and December 31, 2013, respectively, for both crude oil lifting receivables and billings under the Technical Services Agreement (“TSA”) signed with Allied in January 2013. Under the TSA, the Company agreed to provide certain services related to the Oyo Field within OMLs 120 and 121, in exchange for payments from Allied of $150,000 per month with effect from September 2012. The TSA was terminated as of the closing of the Allied Acquisition in February, 2014 pursuant to the Transfer Agreement. | ||||||||
The company was owed $0.6 million as of March 31, 2014 and December 31, 2013, respectively, as a result of a prepayment made for royalty and petroleum profit taxes in Nigeria under the PSC. | ||||||||
As of March 31, 2014 and December 31, 2013, the Company owed $27.0 million and $25.7 million, respectively, to Allied as reimbursement for costs incurred for the benefit of the Company. | ||||||||
As of March 31, 2014 and December 31, 2013, the Company had outstanding notes payable balances of $92.1 million and $6.5 million, respectively, owed to Allied. Included in the note payable balance at March 31, 2014 is an amount of $85.0 million due to Allied for the remaining cash consideration upon the Second Closing of the Private Placement with PIC and the remaining principal balance of the Promissory Note with Allied. See Note 3 – Acquisitions, for details relating to the Allied Transaction, and Note 7 – Debt, for details relating to the Promissory Note. | ||||||||
As partial consideration in connection with the February 2014 closing of the Allied Acquisition, the Company issued a $50.0 million Convertible Subordinated Note in favor of Allied. See Note 7, Debt for details relating to the Convertible Subordinated Note. | ||||||||
Segment_Information
Segment Information | 3 Months Ended | ||||||||||||||||||||
Mar. 31, 2014 | |||||||||||||||||||||
Segment Information | ' | ||||||||||||||||||||
13. Segment Information | |||||||||||||||||||||
The Company’s operations are based in Nigeria, Kenya and The Gambia. 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 Company did not previously report separate segment information because management reviewed and evaluated the operations of the company as a whole. However, beginning in the first quarter 2014, pursuant to the Allied Transaction and the significant exploration activities undertaken in several of our subsidiaries, management began to evaluate the operations of each geographic segment separately. | |||||||||||||||||||||
Segment activity for the three months ended March 31, 2014 and 2013 are as follows: | |||||||||||||||||||||
Nigeria | Kenya | The Gambia | Corporate and Other | Total | |||||||||||||||||
Three months ended March 31, | (In thousands) | ||||||||||||||||||||
2014 | |||||||||||||||||||||
Revenues | $ | 19,894 | - | - | - | $ | 19,894 | ||||||||||||||
Operating income (loss) | $ | 2,313 | (1,992 | ) | (268 | ) | (4,517 | ) | $ | (4,464 | ) | ||||||||||
2013 | |||||||||||||||||||||
Revenues | $ | 22,006 | - | - | - | $ | 22,006 | ||||||||||||||
Operating income (loss) | $ | (3,088 | ) | (654 | ) | (236 | ) | (4,051 | ) | $ | (8,029 | ) | |||||||||
Nigeria | Kenya | The Gambia | Corporate and Other | Total | |||||||||||||||||
Total Assets | (In thousands) | ||||||||||||||||||||
As of March 31, 2014 | $ | 450,693 | 1,549 | 2,045 | 36,788 | $ | 491,075 | ||||||||||||||
As of December 31, 2013 | $ | 441,826 | 1,484 | 2,025 | 858 | $ | 446,193 | ||||||||||||||
Subsequent_Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2014 | |
Subsequent Events | ' |
14. Subsequent Events | |
In April 2014, the Company signed a Petroleum Agreement relating to the Expanded Shallow Water Tano block in Ghana. The Company has been named technical operator and will hold a 30% interest in the block. The block contains three discovered fields, and the work program requires the partners to determine, within nine months, the economic viability of developing the discovered fields |
Basis_of_Presentation_and_Rece1
Basis of Presentation and Recently Issued Accounting Standards (Policies) | 3 Months Ended |
Mar. 31, 2014 | |
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”) and 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 which 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. This Form 10-Q should be read in conjunction with our audited consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2013. | |
In February 2014, the Company completed the acquisition of the remaining economic interests that it did not already own in the Production Sharing Contract (“PSC”) covering Oil Mining Leases 120 and 121 (“OMLs 120 and 121”) offshore Nigeria, which include the currently producing Oyo Field (the “Allied Assets”), from Allied (the “Allied Transaction”). Allied is a subsidiary of CEHL, the Company’s majority shareholder and deemed to be under common control (transactions between subsidiaries of the same parent). Accordingly, the net assets acquired from Allied were recorded at their respective carrying values as of the acquisition date. The financial statements presented for all periods included herein are presented as though the transfer of the Allied assets had occurred at the beginning of the first period presented. | |
Recently Issued Accounting Standards | ' |
Recently Issued Accounting Standards | |
In April 2014, the Financial Accounting Standards Board (“FASB”) issued updated guidance that changes the criteria for reporting discontinued operations including enhanced disclosure requirements. Under the new guidance, only disposals representing a strategic shift in operations should be presented as discontinued operations. Those strategic shifts should have a major effect on the organization´s operations and financial results. The standards update is effective for fiscal years beginning after December 15, 2014. We will adopt this standards update, as required, beginning with the first quarter of 2015. The adoption of this standards update affects presentation only and, as such, is not expected to have a material impact on our consolidated financial statements. | |
Acquisitions_Tables
Acquisitions (Tables) | 3 Months Ended | ||||
Mar. 31, 2014 | |||||
Schedule of Purchase Consideration Assets Acquired and Liabilities Assumed | ' | ||||
The contractual purchase consideration to be paid and the assets acquired and liabilities assumed are as follows (In thousands): | |||||
Cash consideration paid upon First Closing | $ | 85,000 | |||
Cash consideration to be paid upon Second Closing | 85,000 | ||||
CAMAC common stock | - | ||||
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 | 249,739 | ||||
Accounts payable | (25,429 | ) | |||
Asset retirement obligations | (20,890 | ) | |||
Net assets acquired | 203,420 | ||||
Consideration in excess of carrying value acquired | $ | 16,580 | |||
Property_Plant_and_Equipment_T
Property, Plant and Equipment (Tables) | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Property, Plant and Equipment | ' | |||||||
Property, plant and equipment is comprised of the following: | ||||||||
March 31, | December 31, | |||||||
2014 | 2013 | |||||||
(In thousands) | ||||||||
Wells and production facilities | $ | 28,874 | $ | 28,874 | ||||
Proved properties | 386,196 | 386,196 | ||||||
Warehouse inventory | 25,429 | 25,429 | ||||||
Work in progress | 63,958 | 62,208 | ||||||
Oilfield assets | 504,457 | 502,707 | ||||||
Accumulated depletion | (78,976 | ) | (74,476 | ) | ||||
Oilfield assets, net | 425,481 | 428,231 | ||||||
Unevaluated leaseholds | 8,240 | 8,240 | ||||||
Oil and gas properties, net | 433,721 | 436,471 | ||||||
Other property and equipment | 1,866 | 1,590 | ||||||
Accumulated depreciation | (911 | ) | (838 | ) | ||||
Other property and equipment, net | 955 | 752 | ||||||
Total property, plant and equipment, net | $ | 434,676 | $ | 437,223 | ||||
Asset_Retirement_Obligations_T
Asset Retirement Obligations (Tables) | 3 Months Ended | |||
Mar. 31, 2014 | ||||
Summary of Changes in Asset Retirement Obligations | ' | |||
The following summarizes changes in the Company’s asset retirement obligations during the three months ended March 31, 2014: | ||||
2014 | ||||
(In thousands) | ||||
Carrying amount at January 1 | $ | 20,601 | ||
Accretion expense | 440 | |||
Carrying amount at March 31 | $ | 21,041 | ||
Earnings_Loss_Per_Common_Share1
Earnings (Loss) Per Common Share (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Weighted Average Number of Common Shares Outstanding for Computing Basic and Diluted Earnings (Loss) Per Common Share | ' | ||||||||
Basic earnings (loss) per common share are computed by dividing net income (loss) available to common stockholders by the weighted-average number of common shares outstanding for the period. The weighted average number of common shares outstanding for computing basic and diluted earnings (loss) per common share for the three months ended March 31, 2014 and 2013 were as follows: | |||||||||
Three Months Ended March 31, | |||||||||
2014 | 2013 | ||||||||
(In thousands) | |||||||||
Basic | 676,927 | 379,880 | |||||||
Diluted | 676,927 | 379,880 | |||||||
Antidilutive Securities Excluded from Computation of Earnings Per Share | ' | ||||||||
The number of stock options and restricted stock awards that were excluded from dilutive shares outstanding as these potentially dilutive securities are anti-dilutive because the Company was in a loss position for the three months ended March 31, 2014 and 2013 were as follows: | |||||||||
Three Months Ended March 31, | |||||||||
2014 | 2013 | ||||||||
(In thousands) | |||||||||
Stock options | 7,433 | 353 | |||||||
Nonvested restricted stock awards | 7,500 | 1,561 | |||||||
14,933 | 1,914 | ||||||||
Related_Party_Transactions_Tab
Related Party Transactions (Tables) | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Summary of Related Party Transactions and Balances | ' | |||||||
The Company has transactions in the normal course of business with its shareholders, CEHL and their affiliates. The following table summarizes related party transactions for the respective periods: | ||||||||
March 31, | December 31, | |||||||
2014 | 2013 | |||||||
(In thousands) | ||||||||
Accounts receivable | $ | 4,154 | $ | 1,026 | ||||
Other current assets | $ | 624 | $ | 624 | ||||
Accounts payable and accrued expenses | $ | 27,047 | $ | 25,721 | ||||
Note payable-related party | $ | 92,147 | $ | 6,496 | ||||
Long-term note payable-related party | $ | 50,000 | $ | - | ||||
Segment_Information_Tables
Segment Information (Tables) | 3 Months Ended | ||||||||||||||||||||
Mar. 31, 2014 | |||||||||||||||||||||
Schedule of Segment Activity | ' | ||||||||||||||||||||
Segment activity for the three months ended March 31, 2014 and 2013 are as follows: | |||||||||||||||||||||
Nigeria | Kenya | The Gambia | Corporate and Other | Total | |||||||||||||||||
Three months ended March 31, | (In thousands) | ||||||||||||||||||||
2014 | |||||||||||||||||||||
Revenues | $ | 19,894 | - | - | - | $ | 19,894 | ||||||||||||||
Operating income (loss) | $ | 2,313 | (1,992 | ) | (268 | ) | (4,517 | ) | $ | (4,464 | ) | ||||||||||
2013 | |||||||||||||||||||||
Revenues | $ | 22,006 | - | - | - | $ | 22,006 | ||||||||||||||
Operating income (loss) | $ | (3,088 | ) | (654 | ) | (236 | ) | (4,051 | ) | $ | (8,029 | ) | |||||||||
Nigeria | Kenya | The Gambia | Corporate and Other | Total | |||||||||||||||||
Total Assets | (In thousands) | ||||||||||||||||||||
As of March 31, 2014 | $ | 450,693 | 1,549 | 2,045 | 36,788 | $ | 491,075 | ||||||||||||||
As of December 31, 2013 | $ | 441,826 | 1,484 | 2,025 | 858 | $ | 446,193 | ||||||||||||||
Company_Description_Additional
Company Description - Additional Information (Details) | Mar. 31, 2014 |
License | |
Country | |
acre | |
Company description [Abstract] | ' |
Area of land held for exploration activities | 10,000,000 |
Number of countries company operates in Africa | ' |
Number of licenses | ' |
Acquisitions_Additional_inform
Acquisitions - Additional information (Details) (USD $) | 1 Months Ended | ||||
Feb. 28, 2014 | Feb. 28, 2014 | Feb. 28, 2014 | 31-May-14 | 31-May-14 | |
Allied Transaction | Share Purchase Agreement | Share Purchase Agreement | Subsequent Event | Subsequent Event | |
Convertible Subordinated Note | Private Placement | Installment One | Allied Transaction | Share Purchase Agreement | |
Installment | Private Placement | Convertible Subordinated Note | Installment Two | ||
Private Placement | |||||
Business Acquisition [Line Items] | ' | ' | ' | ' | ' |
Business Acquisition, value of shares issued | ' | $270,000,000 | $135,000,000 | ' | $135,000,000 |
Business acquisition, number of shares issued | 497,454,857 | 376,884,422 | 188,442,211 | ' | 188,442,211 |
Number of installments | ' | 2 | ' | ' | ' |
Convertible subordinate note issued | 50,000,000 | ' | ' | ' | ' |
Business combination, notes payable advanced | 25,000,000 | ' | ' | 25,000,000 | ' |
Cash consideration | $85,000,000 | ' | ' | $85,000,000 | ' |
Purchase_Consideration_Paid_an
Purchase Consideration Paid and Assets Acquired and Liabilities Assumed (Details) (USD $) | 1 Months Ended | ||
In Thousands, unless otherwise specified | Feb. 28, 2014 | Feb. 28, 2014 | 31-May-14 |
Cash consideration paid upon First Closing | Subsequent Event | ||
Cash consideration to be paid upon Second Closing | |||
Business Acquisition [Line Items] | ' | ' | ' |
Cash consideration | ' | $85,000 | $85,000 |
CAMAC common stock | ' | ' | ' |
Long-term convertible subordinated note payable - related party | 50,000 | ' | ' |
Total purchase price | 220,000 | ' | ' |
Property, plant and equipment, net | 249,739 | ' | ' |
Accounts payable | -25,429 | ' | ' |
Asset retirement obligations | -20,890 | ' | ' |
Net assets acquired | 203,420 | ' | ' |
Consideration in excess of carrying value acquired | $16,580 | ' | ' |
Property_Plant_and_Equipment_D
Property, Plant and Equipment (Details) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Property Plant And Equipment [Line Items] | ' | ' |
Wells and production facilities | $28,874 | $28,874 |
Proved properties | 386,196 | 386,196 |
Warehouse inventory | 25,429 | 25,429 |
Work in progress | 63,958 | 62,208 |
Oilfield assets | 504,457 | 502,707 |
Accumulated depletion | -78,976 | -74,476 |
Oilfield assets, net | 425,481 | 428,231 |
Unproved Oil and Gas Property, Successful Effort Method | 8,240 | 8,240 |
Oil and gas properties, net | 433,721 | 436,471 |
Other property and equipment | 1,866 | 1,590 |
Accumulated depreciation | -911 | -838 |
Other property and equipment, net | 955 | 752 |
Total property, plant and equipment, net | $434,676 | $437,223 |
Suspended_Exploratory_Well_Cos1
Suspended Exploratory Well Costs - Additional Information (Details) (USD $) | 1 Months Ended | |
In Millions, unless otherwise specified | Nov. 30, 2013 | Mar. 31, 2014 |
ft | ||
Costs Incurred Oil And Gas Property Acquisition Exploration And Development Activities [Line Items] | ' | ' |
Hydrocarbons Miocene formation intervals as interpreted by the Logging while drilling | 65 | ' |
Capitalized exploratory drilling cost | ' | $26.90 |
Asset_Retirement_Obligations_S
Asset Retirement Obligations - Summary of Change in Asset Retirement Obligations (Details) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Long Lived Assets To Be Abandoned [Line Items] | ' | ' |
Carrying amount | $20,601 | ' |
Accretion expense | 440 | 541 |
Carrying amount | $21,041 | ' |
Debt_Additional_Information_De
Debt - Additional Information (Details) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2014 | Jun. 30, 2011 | Feb. 28, 2014 | Jun. 30, 2011 | Feb. 28, 2014 |
Promissory Note to Allied | Promissory Note to Allied | Convertible Subordinated Note to Allied | London Interbank Offered Rate (LIBOR) | London Interbank Offered Rate (LIBOR) | |||
Tranches | Promissory Note to Allied | Convertible Subordinated Note to Allied | |||||
Disclosure - Debt - Additional Information (Details) [Line Items] | ' | ' | ' | ' | ' | ' | ' |
Executed subsidiary Promissory Note | $92,100,000 | $6,500,000 | ' | $25,000,000 | ' | ' | ' |
Debt Instrument, Basis Spread on Variable Rate | ' | ' | ' | ' | ' | 2.00% | 5.00% |
Note payable - related party | 92,147,000 | 6,496,000 | 7,100,000 | ' | ' | ' | ' |
Due to Related Parties | 85,000,000 | ' | ' | ' | ' | ' | ' |
Convertible subordinate note issued | ' | ' | ' | ' | 50,000,000 | ' | ' |
Number of tranches | ' | ' | ' | ' | 2 | ' | ' |
Business combination, notes payable advanced | ' | ' | ' | ' | 25,000,000 | ' | ' |
Debt instrument, convertible, conversion price | ' | ' | ' | ' | $0.72 | ' | ' |
Long-term Debt, Description | ' | ' | ' | ' | 'The note is subject to mandatory prepayment upon (i) the Companybs 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. | ' | ' |
Minimum threshold proceeds from capital market debt issuance for mandatory prepayment option | ' | ' | ' | ' | $250,000,000 | ' | ' |
ShareBased_Compensation_Additi
Share-Based Compensation - Additional Information (Details) | 3 Months Ended |
Mar. 31, 2014 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ' |
Stock Issued During Period, Shares, Restricted Stock Award, Gross | 710,196 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 2,023,914 |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period | 3,670,735 |
Minimum | ' |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | '24 months |
Maximum | ' |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | '36 months |
Weighted_Average_Number_of_Com
Weighted Average Number of Common Shares Outstanding for Computing Basic and Diluted Earnings (Loss) Per Common Share (Details) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Weighted Average Number of Common Shares Outstanding [Abstract] | ' | ' |
Basic | 676,927 | 379,880 |
Diluted | 676,927 | 379,880 |
Antidilutive_Securities_Exclud
Antidilutive Securities Excluded from Computation of Earnings Per Share (Details) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ' | ' |
Antidilutive securities | 14,933 | 1,914 |
Stock options | ' | ' |
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ' | ' |
Antidilutive securities | 7,433 | 353 |
Nonvested restricted stock awards | ' | ' |
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ' | ' |
Antidilutive securities | 7,500 | 1,561 |
Commitments_and_Contingencies_
Commitments and Contingencies - Additional Information (Details) (USD $) | 3 Months Ended |
In Millions, unless otherwise specified | Mar. 31, 2014 |
Boe | |
Other Commitments [Line Items] | ' |
Minimum commitment | $86 |
Barrels processing capacity | 40,000 |
Production, barrels of oil equivalents | 1,000,000 |
Minimum commitment, due in first year | 35 |
Minimum commitment, due thereafter | $48 |
the bKenya PSCsb | ' |
Other Commitments [Line Items] | ' |
Production sharing contracts with the Government of the Republic of Kenya | 4 |
the bGambia Licensesb | ' |
Other Commitments [Line Items] | ' |
Petroleum Exploration, Development & Production Licenses with the Republic of the Gambia | 2 |
Summary_of_Related_Party_Trans
Summary of Related Party Transactions and Balances (Details) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Related Party Transaction [Line Items] | ' | ' |
Accounts receivable | $4,154 | $1,026 |
Other current assets | 624 | 624 |
Accounts payable and accrued expenses | 27,047 | 25,721 |
Note payable - related party | 92,147 | 6,496 |
Long-term note payable - related party | $50,000 | ' |
Related_Party_Transactions_Add
Related Party Transactions - Additional Information (Details) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 | Feb. 28, 2014 | Mar. 31, 2014 |
Convertible Subordinated Note to Allied | Monthly Revenue From Allied | |||
Related Party Transaction [Line Items] | ' | ' | ' | ' |
Crude oil lifting receivables and billings | $4,154,000 | $1,026,000 | ' | ' |
Revenue from Related Parties | ' | ' | ' | 150,000 |
Other current assets | 624,000 | 624,000 | ' | ' |
Accounts payable and accrued expenses | 27,047,000 | 25,721,000 | ' | ' |
Executed subsidiary Promissory Note | 92,100,000 | 6,500,000 | ' | ' |
Notes payable due to 'Allied' for remaining cash consideration | 85,000,000 | ' | ' | ' |
Convertible subordinate note issued | ' | ' | $50,000,000 | ' |
Segment_Activity_Details
Segment Activity (Details) (USD $) | 3 Months Ended | ||
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 | Dec. 31, 2013 |
Segment Reporting Information [Line Items] | ' | ' | ' |
Revenues | $19,894 | $22,006 | ' |
Operating income (loss) | -4,464 | -8,029 | ' |
Total Assets | 491,075 | ' | 446,193 |
Corporate and Other | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' |
Operating income (loss) | -4,517 | -4,051 | ' |
Total Assets | 36,788 | ' | 858 |
Nigeria | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' |
Revenues | 19,894 | 22,006 | ' |
Operating income (loss) | 2,313 | -3,088 | ' |
Total Assets | 450,693 | ' | 441,826 |
Kenya | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' |
Operating income (loss) | -1,992 | -654 | ' |
Total Assets | 1,549 | ' | 1,484 |
Gambia | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' |
Operating income (loss) | -268 | -236 | ' |
Total Assets | $2,045 | ' | $2,025 |
Subsequent_Events_Details
Subsequent Events (Details) (Subsequent Event) | Apr. 01, 2014 |
block | |
Subsequent Event | ' |
Subsequent Event [Line Items] | ' |
Percentage of interest in Expanded Shallow Water Tano block | 30.00% |
Number of disolved fields | 3 |