Document And Entity Information
Document And Entity Information - shares | 9 Months Ended | |
Sep. 30, 2016 | Nov. 01, 2016 | |
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2016 | |
Document Fiscal Year Focus | 2,016 | |
Document Fiscal Period Focus | Q3 | |
Entity Registrant Name | Gastar Exploration Inc. | |
Trading Symbol | GST | |
Entity Central Index Key | 1,431,372 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 131,723,116 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2016 | Dec. 31, 2015 |
CURRENT ASSETS: | ||
Cash and cash equivalents | $ 46,739 | $ 50,074 |
Accounts receivable, net of allowance for doubtful accounts of $1,953 and $0, respectively | 8,476 | 14,302 |
Commodity derivative contracts | 5,240 | 15,534 |
Prepaid expenses | 4,694 | 5,056 |
Total current assets | 65,149 | 84,966 |
Oil and natural gas properties, full cost method of accounting: | ||
Unproved properties, excluded from amortization | 109,267 | 92,609 |
Proved properties | 1,242,667 | 1,286,373 |
Total oil and natural gas properties | 1,351,934 | 1,378,982 |
Furniture and equipment | 2,615 | 3,068 |
Total property, plant and equipment | 1,354,549 | 1,382,050 |
Accumulated depreciation, depletion and amortization | (1,125,881) | (1,053,116) |
Total property, plant and equipment, net | 228,668 | 328,934 |
OTHER ASSETS: | ||
Commodity derivative contracts | 3,915 | 9,335 |
Deferred charges, net | 616 | 985 |
Advances to operators and other assets | 498 | 331 |
Other | 1,121 | 4,944 |
Total other assets | 6,150 | 15,595 |
TOTAL ASSETS | 299,967 | 429,495 |
CURRENT LIABILITIES: | ||
Accounts payable | 4,585 | 2,029 |
Revenue payable | 5,667 | 5,985 |
Accrued interest | 10,517 | 3,730 |
Accrued drilling and operating costs | 5,250 | 2,010 |
Advances from non-operators | 110 | 167 |
Commodity derivative contracts | 102 | 0 |
Commodity derivative premium payable | 1,750 | 3,194 |
Asset retirement obligation | 89 | 89 |
Other accrued liabilities | 7,296 | 6,764 |
Total current liabilities | 35,366 | 23,968 |
LONG-TERM LIABILITIES: | ||
Long-term debt | 418,620 | 516,476 |
Commodity derivative contracts | 0 | 451 |
Commodity derivative premium payable | 1,427 | 2,788 |
Asset retirement obligation | 5,626 | 5,997 |
Total long-term liabilities | 425,673 | 525,712 |
Commitments and contingencies (Note 11) | ||
STOCKHOLDERS’ DEFICIT: | ||
Common stock, par value $0.001 per share; 550,000,000 and 275,000,000 shares authorized at September 30, 2016 and December 31, 2015, respectively; 131,725,215 and 80,024,218 shares issued and outstanding at September 30, 2016 and December 31, 2015, respectively | 132 | 80 |
Additional paid-in capital | 626,379 | 571,947 |
Accumulated deficit | (787,645) | (692,274) |
Total stockholders’ deficit | (161,072) | (120,185) |
TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT | 299,967 | 429,495 |
Series A Preferred Stock | ||
STOCKHOLDERS’ DEFICIT: | ||
Preferred stock | 41 | 41 |
Series B Preferred Stock | ||
STOCKHOLDERS’ DEFICIT: | ||
Preferred stock | $ 21 | $ 21 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Sep. 30, 2016 | Dec. 31, 2015 |
Accounts receivable, net of allowance for doubtful accounts | $ 1,953 | $ 0 |
Preferred stock, shares authorized | 40,000,000 | 40,000,000 |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 550,000,000 | 275,000,000 |
Common stock, shares issued | 131,725,215 | 80,024,218 |
Common stock, shares outstanding | 131,725,215 | 80,024,218 |
Series A Preferred Stock | ||
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred stock, par value | $ 0.01 | $ 0.01 |
Preferred stock, shares issued | 4,045,000 | 4,045,000 |
Preferred stock, shares outstanding | 4,045,000 | 4,045,000 |
Liquidation Preference | $ 25 | $ 25 |
Series B Preferred Stock | ||
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred stock, par value | $ 0.01 | $ 0.01 |
Preferred stock, shares issued | 2,140,000 | 2,140,000 |
Preferred stock, shares outstanding | 2,140,000 | 2,140,000 |
Liquidation Preference | $ 25 | $ 25 |
Condensed Consolidated Statemen
Condensed Consolidated Statements Of Operations - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
REVENUES: | ||||
Oil and condensate | $ 10,306 | $ 12,835 | $ 30,464 | $ 45,772 |
Natural gas | 2,500 | 3,459 | 8,394 | 14,109 |
NGLs | 1,695 | 791 | 5,100 | 5,071 |
Total oil, condensate, natural gas and NGLs revenues | 14,501 | 17,085 | 43,958 | 64,952 |
(Loss) gain on commodity derivatives contracts | (1,498) | 11,301 | (3,991) | 19,734 |
Total revenues | 13,003 | 28,386 | 39,967 | 84,686 |
EXPENSES (BENEFIT): | ||||
Production taxes | 400 | 655 | 1,469 | 2,317 |
Lease operating expenses | 5,166 | 5,214 | 15,829 | 18,475 |
Transportation, treating and gathering | 338 | 615 | 1,346 | 1,654 |
Depreciation, depletion and amortization | 5,223 | 15,394 | 24,543 | 45,945 |
Impairment of oil and natural gas properties | 0 | 181,966 | 48,497 | 282,118 |
Accretion of asset retirement obligation | 92 | 131 | 286 | 387 |
General and administrative expense | 3,925 | 4,683 | 15,872 | 13,352 |
Litigation settlement benefit | (10,100) | 0 | (10,100) | 0 |
Total expenses | 5,044 | 208,658 | 97,742 | 364,248 |
INCOME (LOSS) FROM OPERATIONS | 7,959 | (180,272) | (57,775) | (279,562) |
OTHER INCOME (EXPENSE): | ||||
Interest expense | (8,178) | (7,933) | (26,739) | (22,430) |
Investment income and other (expense) | 41 | 4 | (2) | 10 |
LOSS BEFORE PROVISION FOR INCOME TAXES | (178) | (188,201) | (84,516) | (301,982) |
Provision for income taxes | 0 | 0 | 0 | 0 |
NET LOSS | (178) | (188,201) | (84,516) | (301,982) |
Dividends on preferred stock | (3,618) | (3,618) | (10,855) | (10,855) |
NET LOSS ATTRIBUTABLE TO COMMON STOCKHOLDERS | $ (3,796) | $ (191,819) | $ (95,371) | $ (312,837) |
NET LOSS PER SHARE OF COMMON STOCK ATTRIBUTABLE TO COMMON STOCKHOLDERS: | ||||
Basic (in dollars per share) | $ (0.03) | $ (2.47) | $ (0.92) | $ (4.04) |
Diluted (in dollars per share) | $ (0.03) | $ (2.47) | $ (0.92) | $ (4.04) |
WEIGHTED AVERAGE SHARES OF COMMON STOCK OUTSTANDING: | ||||
Basic (shares) | 129,301,817 | 77,628,120 | 104,125,317 | 77,453,251 |
Diluted (shares) | 129,301,817 | 77,628,120 | 104,125,317 | 77,453,251 |
Condensed Consolidated Stateme5
Condensed Consolidated Statements Of Cash Flows - USD ($) $ in Thousands | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | ||
CASH FLOWS FROM OPERATING ACTIVITIES: | |||
Net loss | $ (84,516) | $ (301,982) | |
Adjustments to reconcile net loss to net cash provided by operating activities: | |||
Depreciation, depletion and amortization | 24,543 | 45,945 | |
Impairment of oil and natural gas properties | 48,497 | 282,118 | |
Stock-based compensation | 3,145 | 3,927 | |
Total loss (gain) on commodity derivatives contracts | 3,991 | (19,734) | |
Cash settlements of matured commodity derivatives contracts, net | 10,690 | 17,913 | |
Cash premiums paid for commodity derivatives contracts | (565) | (45) | |
Amortization of deferred financing costs | [1] | 3,812 | 2,652 |
Accretion of asset retirement obligation | 286 | 387 | |
Settlement of asset retirement obligation | (87) | (80) | |
Loss on sale of furniture and equipment | 97 | 0 | |
Changes in operating assets and liabilities: | |||
Accounts receivable | 3,861 | 22,552 | |
Prepaid expenses | 362 | 1,472 | |
Accounts payable and accrued liabilities | 7,656 | (289) | |
Net cash provided by operating activities | 21,772 | 54,836 | |
CASH FLOWS FROM INVESTING ACTIVITIES: | |||
Development and purchase of oil and natural gas properties | (43,175) | (121,074) | |
Reimbursements from (advances to) operators | 211 | (2,325) | |
Acquisition of oil and natural gas properties - refund | 1,149 | 0 | |
Proceeds from sale of oil and natural gas properties | 77,499 | 47,866 | |
Payments to non-operators | (57) | (1,820) | |
Proceeds from sale (purchase) of furniture and equipment | 80 | (51) | |
Net cash provided by (used in) investing activities | 35,707 | (77,404) | |
CASH FLOWS FROM FINANCING ACTIVITIES: | |||
Proceeds from revolving credit facility | 0 | 75,000 | |
Repayment of revolving credit facility | (100,370) | (40,000) | |
Proceeds from issuance of common stock, net of issuance costs | 44,815 | 0 | |
Dividends on preferred stock | (3,618) | (10,855) | |
Deferred financing charges | (930) | (804) | |
Tax withholding related to restricted stock and performance based unit award vestings | (711) | (1,430) | |
Net cash (used in) provided by financing activities | (60,814) | 21,911 | |
NET DECREASE IN CASH AND CASH EQUIVALENTS | (3,335) | (657) | |
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD | 50,074 | 11,008 | |
CASH AND CASH EQUIVALENTS, END OF PERIOD | $ 46,739 | $ 10,351 | |
[1] | The three months ended September 30, 2016 and 2015 includes $711,000 and $644,000, respectively, of debt discount accretion related to the Notes. The nine months ended September 30, 2016 and 2015 includes $2.1 million and $1.9 million, respectively, of debt discount accretion related to the Notes. |
Description of Business
Description of Business | 9 Months Ended |
Sep. 30, 2016 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Description of Business | 1. Description of Business Gastar Exploration Inc. (the “Company” or “Gastar”) is a pure play Mid-Continent independent energy company engaged in the exploration, development and production of oil, condensate, natural gas and NGLs. Gastar’s principal business activities include the identification, acquisition, and subsequent exploration and development of oil and natural gas properties with an emphasis on unconventional reserves, such as shale resource plays. Gastar holds a concentrated acreage position in what is believed to be the core of the STACK Play, an area of central Oklahoma which is home to multiple oil and natural gas-rich reservoirs including the Oswego limestone, Meramec and Osage bench formations within the Mississippi Lime, the Woodford shale and Hunton limestone formations. On April 8, 2016, Gastar sold substantially all of its producing assets and proved reserves and a significant portion of its undeveloped acreage in the Appalachian Basin for an adjusted sales price of $75.7 million, net of $3.5 million of suspense liability transferred to buyer, with an effective date of January 1, 2016 (the “Appalachian Basin Sale”). For any date or period prior to January 31, 2014, “Gastar,” the “Company,” “we,” “us,” “our” and similar terms refer collectively to Gastar Exploration, Inc. (formerly known as Gastar Exploration Ltd.) and its subsidiaries, including Gastar Exploration Inc. (formerly known as Gastar Exploration USA, Inc.), and for any date or period after January 31, 2014, such terms refer collectively to Gastar Exploration Inc. and its subsidiaries. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2016 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies The accounting policies followed by the Company are set forth in the notes to the Company’s audited consolidated financial statements included in its Annual Report on Form 10-K for the year ended December 31, 2015 (the “2015 Form 10-K”) filed with the SEC. Please refer to the notes to the consolidated financial statements included in the 2015 Form 10-K for additional details of the Company’s financial condition, results of operations and cash flows. No material item included in those notes has changed except as a result of normal transactions in the interim or as disclosed within this report. The unaudited interim condensed consolidated financial statements of the Company included herein are stated in U.S. dollars and were prepared from the records of the Company by management in accordance with U.S. GAAP applicable to interim financial statements and reflect all normal and recurring adjustments, which are, in the opinion of management, necessary to provide a fair presentation of the results of operations and financial position for the interim periods. Such financial statements conform to the presentation reflected in the 2015 Form 10-K. The current interim period reported herein should be read in conjunction with the financial statements and accompanying notes, including Item 8. “Financial Statements and Supplementary Data, Note 2 – Summary of Significant Accounting Policies,” included in the 2015 Form 10-K. The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates with regard to these financial statements include the estimate of proved oil and natural gas reserve quantities and the related present value of estimated future net cash flows. The unaudited interim condensed consolidated financial statements of the Company include the consolidated accounts of all of its subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation. Certain reclassifications of prior year balances have been made to conform to the current year presentation; these reclassifications have no impact on net income (loss). The results of operations for the three and nine months ended September 30, 2016 are not necessarily indicative of the results that may be expected for the year ending December 31, 2016. Subsequent Events In preparing these financial statements, the Company has evaluated events and transactions for potential recognition or disclosure through the date the financial statements were issued and has disclosed certain subsequent events in these condensed consolidated financial statements, as appropriate. Revolving Credit Facility On October 14, 2016, the Company, together with the parties thereto, entered into Amendment No. 9 to Second Amended and Restated Credit Agreement (“Amendment No. 9”), which amended the Revolving Credit Facility to, among other things: (i) reaffirm the borrowing base at $100.0 million with next redetermination scheduled for November 2016; (ii) add a mandatory prepayment provision that requires prepayment of the Revolving Credit Facility (as defined below) by an amount equal to 20% of any future net sales proceeds from the sale of the Company’s South STACK Play acreage primarily located in Canadian County, Oklahoma; (iii) to adjust the minimum interest coverage ratio to: (i) 0.8 to 1.0 for fourth quarter 2016 and first quarter 2017, (ii) 1.0 to 1.0 for second quarter 2017 and (iii) 2.50 to 1.0 thereafter, each as determined using adjusted EBITDA for previous four quarters; and (iv) to accommodate the Drilling Program (as defined below). Development Agreement On October 14, 2016, the Company executed a definitive agreement with STACK Exploration LLC, a Delaware limited liability company, (the “Investor”) to jointly develop up to 60 Gastar operated wells in the STACK Play in Kingfisher County, Oklahoma (the “Development Agreement”). The drilling program (the “Drilling Program”) will target the Meramec and Osage formations within the Mississippi Lime on a contract area within three townships covering approximately 18,000 undeveloped net mineral acres under leases held by the Company. The Company will be the operator of all wells jointly developed under the Development Agreement. Under the Development Agreement, the Investor will fund 90% of Gastar’s working interest portion of drilling and completion costs to initially earn 80% of Gastar’s working interest in each new well (in each case, proportionately reduced by other participating working interests in the well). As a result, Gastar will pay 10% of its working interest portion of such costs for 20% of its original working interest. The proposed Drilling Program wells will be mutually developed in three tranches of 20 wells each. The locations of the first 20 wells, comprised of 18 Meramec formation wells and two Osage formation wells, have been mutually agreed upon by the Company and the Investor. Participation in the second tranche of 20 Drilling Program wells will be at the election of the Investor and the third tranche of 20 wells will require mutual consent. With respect to each 20 well tranche, when the Investor has achieved an aggregate 15% internal rate of return (“IRR”) for its investment in the tranche, its interest will be reduced from 80% to 40% of Gastar’s original working interest and Gastar’s working interest increases from 20% to 60% of Gastar’s original working interest. When a tranche IRR of 20% is achieved by the Investor, its working interest decreases to 10% and Gastar’s working interest increases to 90% of the working interest originally owned by Gastar. Canadian County Property Sale On October 19, 2016, the Company entered into a purchase and sale agreement to sell certain non-core leasehold interests in approximately 25,300 net acres of which only 19,100 net acres was ascribed allocated value and interests in 25 gross (11.2 net) wells primarily in northeast Canadian County and also in southeast Kingfisher County, Oklahoma to Red Bluff Resources Operating, LLC, a Delaware limited liability company, (“Red Bluff”) for approximately $71.0 million (of which up to $10.0 million is contingent upon the satisfaction of certain conditions), subject to certain adjustments. The transaction is expected to close on or before November 18, 2016, with a property sale effective date of August 1, 2016. Accounts Receivable Accounts receivable are reported net of the allowance for doubtful accounts. The allowance for doubtful accounts is determined based on a review of the Company’s receivables. Receivable accounts are charged off when collection efforts have failed or the account is deemed uncollectible. During the quarter ended June 30, 2016, the Company determined that a receivable account from a third-party natural gas and NGLs purchaser would no longer be collectible as a result of the third-party purchaser filing for bankruptcy. A summary of the activity related to the allowance for doubtful accounts is as follows: September 30, 2016 December 31, 2015 (in thousands) Allowance for doubtful accounts, beginning of period $ — $ — Expense — — Reductions/write-offs 1,953 — Allowance for doubtful accounts, end of period $ 1,953 $ — Recent Accounting Developments The following recently issued accounting pronouncements may impact the Company in future periods: Statement of Cash Flows. In August 2016, the FASB issued updated guidance associated with the classification of certain cash receipts and cash payments on the statement of cash flows. The amended guidance addresses specific cash flow issues with the objective of reducing existing diversity in practice. The amendments in this update apply to all entities required to present a statement of cash flows. The amendments in this update are effective for public business entities for fiscal years beginning after December 15, 2017 and interim periods within those fiscal years. Early adoption is permitted, including adoption in an interim period. If an entity early adopts the amendments in an interim period, any adjustments should be reflected as of the beginning of the fiscal year that includes that interim period. An entity that elects early adoption must adopt all of the amendments in the same period. Amendments should be applied using a retrospective transition method to each period presented. If it is impracticable to apply the amendments retrospectively for some of the issues, the amendments for those issues would be applied prospectively as of the earliest date practicable. The Company has not yet determined what the effects of adopting this updated guidance will be on its statement of cash flows. Compensation – Stock Compensation. In March 2016, the FASB issued updated guidance as part of its simplification initiative which is intended to simplify several aspects of the accounting for stock-based compensation transactions, including the income tax consequences, classification of awards as either equity or liabilities and classification on the statement of cash flows. For public business entities, the amendments in this update are effective for annual periods beginning after December 15, 2016, and interim periods within those annual periods. Early adoption is permitted for any entity in any interim or annual period. If an entity early adopts the amendments in an interim period, any adjustments should be reflected as of the beginning of the fiscal year that includes that interim period. An entity that elects early adoption must adopt all of the amendments in the same period. Amendments related to the timing of when excess tax benefits are recognized, minimum statutory withholding requirements, forfeitures, and intrinsic value should be applied using a modified retrospective transition method by means of a cumulative-effect adjustment to equity as of the beginning of the period in which the guidance is adopted. Amendments related to the presentation of employee taxes paid on the statement of cash flows when an employer withholds shares to meet the minimum statutory withholding requirement should be applied retrospectively. Amendments requiring recognition of excess tax benefits and tax deficiencies in the income statement and the practical expedient for estimating expected term should be applied prospectively. An entity may elect to apply the amendments related to the presentation of excess tax benefits on the statement of cash flows using either a prospective transition method or a retrospective transition method. The Company has not yet determined what the effects of adopting this updated guidance will be on its consolidated financial statements. Leases. In February 2016, the FASB issued updated guidance to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and enhance disclosures regarding key information about leasing arrangements. Under the new guidance, lessees will be required to recognize a lease liability and a right-of-use asset for all leases. The new lease guidance also simplified the accounting for sale and leaseback transactions primarily because lessees must recognize lease assets and lease liabilities. The amendments in this update are effective beginning on January 1, 2019 and should be applied through a modified retrospective transition approach for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. Early adoption is permitted. The Company has not yet determined what the effects of adopting this updated guidance will be on its consolidated financial statements. Income Taxes. In November 2015, the FASB issued updated guidance as part of its simplification initiative for the presentation of deferred taxes. Current U.S. GAAP requires an entity to separate deferred income tax liabilities and assets into current and noncurrent amounts in a classified statement of financial position where such classification generally does not align with the time period in which the recognized deferred tax amounts are expected to be recovered or settled. To simplify the presentation of deferred income taxes, the amendments in this update require that deferred tax liabilities and assets be classified as noncurrent in a classified statement of financial position and apply to all entities that present a classified statement of financial position, resulting in the alignment of the U.S. GAAP presentation of deferred income tax assets and liabilities with International Financial Reporting Standards (IFRS). IAS 1, Presentation of Financial Statements. This guidance is effective for public business entities for financial statements issued for annual periods beginning after December 15, 2016, and interim periods within those annual periods. Earlier application is permitted as of the beginning of an interim or annual reporting period and can be applied either prospectively or retrospectively to all periods presented. The Company does not expect the adoption of this guidance to materially impact its consolidated financial statements. Going Concern. In August 2014, the FASB issued updated guidance related to determining whether substantial doubt exists about an entity's ability to continue as a going concern. The amendment provides guidance for determining whether conditions or events give rise to substantial doubt that an entity has the ability to continue as a going concern within one year following the date of issuance of annual and interim financial statements, and requires specific disclosures regarding the conditions or events leading to substantial doubt. The updated guidance is effective for annual reporting periods ending after December 15, 2016 and for annual periods and interim periods thereafter. Earlier adoption is permitted, but the Company has not elected to adopt the updated guidance early. The Company does not expect the adoption of this guidance to have a material impact on its consolidated financial statements. Revenue Recognition. In May 2014, the FASB issued an amendment to previously issued guidance regarding the recognition of revenue, which supersedes the revenue recognition requirements in Accounting Standards Codification (“ASC”) Topic 605, “Revenue Recognition,” and most industry-specific guidance. The FASB and the International Accounting Standards Board initiated a joint project to clarify the principles for recognizing revenue and to develop a common standard that would (i) remove inconsistencies and weaknesses in revenue requirements, (ii) provide a more robust framework for addressing revenue issues, (iii) improve comparability of revenue recognition practices across entities, industries, jurisdictions and capital markets, (iv) provide more useful information to users of financial statements through improved disclosure requirements and (v) simplify the preparation of financial statements by reducing the number of requirements to which an entity must refer. The core principle of the guidance 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. To achieve this core principle, an entity should apply the following steps: (1) identify the contract(s) with the customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to the performance obligations in the contract; and (5) recognize revenue when (or as) the entity satisfies a performance obligation. This guidance supersedes prior revenue recognition requirements and most industry-specific guidance throughout the FASB Accounting Standards Codification. This guidance is effective for annual reporting periods beginning after December 15, 2016, including interim periods within that reporting period. In April 2015, the FASB proposed to delay the effective date one year, beginning in fiscal year 2018 and such proposal was subsequently adopted by the FASB in August 2015. The Company is evaluating the new guidance and has not yet determined the impact this new standard may have on its consolidated financial statements or decided upon its method of adoption. |
Property, Plant and Equipment
Property, Plant and Equipment | 9 Months Ended |
Sep. 30, 2016 | |
Property Plant And Equipment [Abstract] | |
Property, Plant and Equipment | 3. Property, Plant and Equipment The amount capitalized as oil and natural gas properties was incurred for the purchase and development of various properties in the U.S., located in the states of Oklahoma, Pennsylvania and West Virginia. On April 8, 2016, the Company sold substantially all of its producing assets and proved reserves and a significant portion of its undeveloped acreage in Pennsylvania and West Virginia comprising the Company’s Appalachian Basin assets. The following table summarizes the components of unproved properties excluded from amortization at the dates indicated: September 30, 2016 December 31, 2015 (in thousands) Unproved properties, excluded from amortization: Drilling in progress costs $ 10,346 $ 1,533 Acreage acquisition costs 92,299 82,560 Capitalized interest 6,622 8,516 Total unproved properties excluded from amortization $ 109,267 $ 92,609 The full cost method of accounting for oil and natural gas properties requires a quarterly calculation of a limitation on capitalized costs, often referred to as a full cost ceiling calculation. The ceiling is the present value (discounted at 10% per annum) of estimated future cash flow from proved oil, condensate, natural gas and NGLs reserves reduced by future operating expenses, development expenditures, abandonment costs (net of salvage) to the extent not included in oil and natural gas properties pursuant to authoritative guidance and estimated future income taxes thereon. To the extent that the Company's capitalized costs (net of accumulated depletion and deferred taxes) exceed the ceiling at the end of the reported period, the excess must be written off to expense for such period. Once incurred, this impairment of oil and natural gas properties is not reversible at a later date even if oil and natural gas prices increase. The ceiling calculation is determined using a mandatory trailing 12-month unweighted arithmetic average of the first-day-of-the-month commodities pricing and costs in effect at the end of the period, each of which are held constant indefinitely (absent specific contracts with respect to future prices and costs) with respect to valuing future net cash flows from proved reserves for this purpose. The 12-month unweighted arithmetic average of the first-day-of-the-month commodities prices are adjusted for basis and quality differentials in determining the present value of the proved reserves. The table below sets forth relevant pricing assumptions utilized in the quarterly ceiling test computations for the respective periods noted before adjustment for basis and quality differentials: 2016 Total Year to Date Impairment September 30 June 30 March 31 Henry Hub natural gas price (per MMBtu) (1) $ 2.28 $ 2.24 $ 2.40 West Texas Intermediate oil price (per Bbl) (1) $ 41.68 $ 43.12 $ 46.26 Impairment recorded (pre-tax) (in thousands) $ 48,497 $ — $ — $ 48,497 2015 Total Year to Date Impairment September 30 June 30 March 31 Henry Hub natural gas price (per MMBtu) (1) $ 3.06 $ 3.39 $ 3.88 West Texas Intermediate oil price (per Bbl) (1) $ 59.21 $ 71.68 $ 82.72 Impairment recorded (pre-tax) (in thousands) $ 282,118 $ 181,966 $ 100,152 $ — (1) For the respective periods, oil and natural gas prices are calculated using the trailing 12-month unweighted arithmetic average of the first-day-of-the-month prices based on Henry Hub spot natural gas prices and West Texas Intermediate spot oil prices. The Company could potentially incur further ceiling test impairments in 2016 should commodities prices decline. However, it is difficult to project future impairment charges in light of numerous variables involved. The Company’s proved reserves estimates and their estimated discounted value and standardized measure will also be impacted by changes in lease operating costs, future development costs, production, exploration and development activities. The ceiling limitation calculation is not intended to be indicative of the fair market value of the Company’s proved reserves or future results. Development Agreement On October 14, 2016, the Company executed the Development Agreement with the Investor to jointly develop up to 60 Gastar operated wells in the STACK Play in Kingfisher County, Oklahoma. The Drilling Program will target the Meramec and Osage formations within the Mississippi Lime in a contract area within three townships covering approximately 18,000 undeveloped net mineral acres under leases held by the Company. The Company will be the operator of all wells jointly developed under the Development Agreement. Under the Development Agreement, the Investor will fund 90% of Gastar’s working interest portion of drilling and completion costs to initially earn 80% of Gastar’s working interest in each new well (in each case, proportionately reduced by other participating working interests in the well). As a result, Gastar will pay 10% of its working interest portion of such costs for 20% of its original working interest. The proposed Drilling Program wells will be mutually developed in three tranches of 20 wells each. The locations of the first 20 wells, comprised of 18 Meramec formation wells and two Osage formation wells, have been mutually agreed upon by the Company and the Investor. Participation in the second tranche of 20 Drilling Program wells will be at the election of the Investor and the third tranche of 20 wells will require mutual consent. With respect to each 20 well tranche, when the Investor has achieved an aggregate 15% IRR for its investment in the tranche, its interest will be reduced from 80% to 40% of Gastar’s original working interest and Gastar’s working interest increases from 20% to 60% of Gastar’s original working interest. When a tranche IRR of 20% is achieved by the Investor, its working interest decreases to 10% and Gastar’s working interest increases to 90% of the working interest originally owned by Gastar. Canadian County Property Sale On October 19, 2016, the Company entered into a purchase and sale agreement to sell certain non-core leasehold interests in approximately 25,300 net acres of which only 19,100 net acres was ascribed allocated value and interests in 25 gross (11.2 net) wells primarily in northeast Canadian County and also in southeast Kingfisher County, Oklahoma to Red Bluff for approximately $71.0 million (of which up to $10.0 million is contingent upon the satisfaction of certain conditions), subject to certain adjustments. The transaction is expected to close on or before November 18, 2016, with a property sale effective date of August 1, 2016. Appalachian Basin Sale On February 19, 2016, the Company entered into an agreement to sell substantially all of its producing assets and proved reserves and a significant portion of its undeveloped acreage in the Appalachian Basin for $80.0 million, subject to customary closing adjustments. Pursuant to the agreement, on April 8, 2016, the Company completed the Appalachian Basin Sale for an adjusted sales price of $75.7 million, net of $3.5 million of suspense liability transferred to buyer. The Appalachian Basin Sale is reflected as a reduction to the full cost pool and the Company did not record a gain or loss related to the divestiture as it was not determined to be significant to the full cost pool and did not result in a significant change to the depletion rate. Appalachian Basin Sale Pro Forma Operating Results The following unaudited pro forma results for the three months ended September 30, 2015 and the nine months ended September 30, 2016 and 2015 show the effect on the Company's consolidated results of operations as if the Appalachian Basin Sale had occurred at the beginning of the periods presented. The pro forma results are the result of excluding from the statement of operations of the Company the revenues and direct operating expenses for the properties divested adjusted for (1) the reduction in ARO liabilities and accretion expense for the properties divested, (2) the reduction in depreciation, depletion and amortization expense as a result of the divestiture and (3) the reduction in interest expense as a result of the pay down of debt under the Revolving Credit Facility in conjunction with the closing of the Appalachian Basin Sale. As a result, certain estimates and judgments were made in preparing the pro forma adjustments. For the Three Months Ended September 30, 2015 (in thousands, except (Unaudited) Revenues $ 26,847 Net Loss $ (188,685 ) Loss per share: Basic $ (2.43 ) Diluted $ (2.43 ) For the Nine Months Ended September 30, 2016 2015 (in thousands, except (Unaudited) Revenues $ 36,892 $ 73,515 Net Loss $ (90,336 ) $ (310,148 ) Loss per share: Basic $ (0.87 ) $ (4.00 ) Diluted $ (0.87 ) $ (4.00 ) The pro forma information above includes numerous assumptions, is presented for illustrative purposes only and may not be indicative of the future results or results of operations that would have actually occurred had the Appalachian Basin Sale occurred as presented. In addition, future results may vary significantly from the results reflected in such pro forma information. Husky Acquisition On December 16, 2015, the Company completed the acquisition of additional working and net revenue interests in 103 gross (10.2 net) producing wells and certain undeveloped acreage in the STACK Play and Hunton limestone formations in its existing AMI from its AMI co-participant Husky Ventures, Inc. (“Husky”), Silverstar of Nevada, Inc., Maximus Exploration, LLC and Atwood Acquisitions, LLC for an adjusted purchase price of approximately $42.7 million, net of $358,000 of revenue suspense liability assumed by the Company, reflecting adjustment for an acquisition effective date of July 1, 2015 and which includes a $715,000 deposit into escrow pending the resolution of title defects by the seller recorded to other assets at September 30, 2016, and the conveyance of approximately 11,000 net non-core, non-producing acres in Blaine, Major and Kingfisher Counties, Oklahoma to the sellers, subject to certain adjustments and customary closing conditions (the “Husky Acquisition”). In connection with the acquisition, the AMI participation agreements with the Company’s AMI co-participant were dissolved. The Company accounted for the acquisition as a business combination and therefore, recorded the assets acquired at their estimated acquisition date fair values. The Company incurred a total of $1.5 million of transaction and integration costs associated with the acquisition since closing and expensed these costs as incurred as general and administrative expenses. The Company utilized relevant market assumptions to determine fair value and allocate the purchase price, such as future commodity prices, projections of estimated natural gas and oil reserves, expectations for future development and operating costs, projections of future rates of production, expected recovery rates and market multiples for similar transactions. Many of the assumptions used are unobservable and as such, represent Level 3 inputs under the fair value hierarchy as described in Note 5, “Fair Value Measurements.” The Company's preliminary assessment of the fair value of the Husky Acquisition assets resulted in a fair market valuation of $44.6 million. As the fair market valuation varied less than 6% from the purchase price allocation recorded, no adjustment was made to the purchase price allocation. Husky Acquisition Pro Forma Operating Results The following unaudited pro forma results for the three and nine months ended September 30, 2015 show the effect on the Company’s consolidated results of operations as if the Husky Acquisition had occurred at the beginning of the period presented. The pro forma results are the result of combining the statement of operations of the Company with the statements of revenues and direct operating expenses for the properties acquired from Husky adjusted for (1) assumption of ARO liabilities and accretion expense for the properties acquired and (2) additional depreciation, depletion and amortization expense as a result of the Company’s increased ownership in the acquired properties. The statements of revenues and direct operating expenses for the Husky Acquisition assets exclude all other historical expenses of Husky. As a result, certain estimates and judgments were made in preparing the pro forma adjustments. For the Three Months Ended September 30, 2015 For the Nine Months Ended September 30, 2015 (in thousands, except (Unaudited) Revenues $ 30,087 $ 91,493 Net Loss $ (191,256 ) $ (309,921 ) Loss per share: Basic $ (2.46 ) $ (4.00 ) Diluted $ (2.46 ) $ (4.00 ) The pro forma information above includes numerous assumptions, is presented for illustrative purposes only and may not be indicative of the future results or results of operations that would have actually occurred had the Husky Acquisition occurred as presented. Further, the above pro forma amounts do not consider any potential synergies or integration costs that may result from the transaction. In addition, future results may vary significantly from the results reflected in such pro forma information. |
Long-Term Debt
Long-Term Debt | 9 Months Ended |
Sep. 30, 2016 | |
Debt Disclosure [Abstract] | |
Long-Term Debt | 4. Long-Term Debt Second Amended and Restated Revolving Credit Facility On June 7, 2013, the Company entered into the Second Amended and Restated Credit Agreement among the Company, Wells Fargo Bank, National Association, as Administrative Agent, Collateral Agent, Swing Line Lender and Issuing Lender and the lenders named therein (the “Revolving Credit Facility”). At the Company's election, borrowings bear interest at the reference rate or the Eurodollar rate plus an applicable margin. The reference rate is the greater of (i) the rate of interest publicly announced by the administrative agent, (ii) the federal funds rate plus 50 basis points and (iii) LIBOR plus 1.0%. The applicable interest rate margin varies from 1.0% to 2.0% in the case of borrowings based on the reference rate and from 2.0% to 3.0% in the case of borrowings based on the Eurodollar rate, depending on the utilization percentage in relation to the borrowing base and subject to adjustments based on the Company's leverage ratio. An annual commitment fee of 0.5% is payable quarterly on the unutilized balance of the borrowing base. The Revolving Credit Facility has a scheduled maturity of November 14, 2017. The Revolving Credit Facility will be guaranteed by all of the Company's future domestic subsidiaries formed during the term of the Revolving Credit Facility. Borrowings and related guarantees are secured by a first priority lien on certain domestic oil and natural gas properties currently owned by or later acquired by the Company and its subsidiaries, excluding de minimis value properties as determined by the lender. The Revolving Credit Facility is secured by a first priority pledge of the capital stock of each domestic subsidiary, a first priority interest on all accounts receivable, notes receivable, inventory, contract rights, general intangibles and material property of the issuer and 65% of the stock of any foreign subsidiary of the Company. The Revolving Credit Facility contains various covenants, including, among others: • Restrictions on liens, incurrence of other indebtedness without lenders' consent and common stock dividends and other restricted payments; • Maintenance of a minimum consolidated current ratio as of the end of each quarter of not less than 1.0 to 1.0, as adjusted; • Maintenance of a maximum ratio of net indebtedness to EBITDA of not greater than 4.0 to 1.0, subject to the modifications in Amendment No. 8 set forth below; and • Maintenance of an interest coverage ratio on a rolling four quarters basis, as adjusted, of EBITDA to interest expense, as of the end of each quarter, to be less than 2.5 to 1.0, subject to the modifications in Amendment No. 8 set forth below. All outstanding amounts owed become due and payable upon the occurrence of certain usual and customary events of default, including, among others: • Failure to make payments; • Non-performance of covenants and obligations continuing beyond any applicable grace period; and • The occurrence of a change in control of the Company, as defined under the Revolving Credit Facility. On December 22, 2015, the Company, together with the parties thereto, entered into Amendment No. 6 to Second Amended and Restated Credit Agreement (“Amendment No. 6”). Amendment No. 6 amended the Revolving Credit Facility to permit the Company to exchange its outstanding Notes constituting Second Lien Debt under the Revolving Credit Facility for equity interests in the Company. On January 29, 2016, the Company, together with the parties thereto, entered into Limited Waiver and Amendment No. 7 to Second Amended and Restated Credit Agreement (“Amendment No. 7”). Pursuant to Amendment No. 7, the Company obtained (i) a waiver until March 10, 2016 of any potential defaults at December 31, 2015 of its leverage ratio and senior secured leverage ratio under the Revolving Credit Facility and (ii) a permanent waiver of any defaults of the restricted payment covenant under the Revolving Credit Facility resulting from (a) cash distributions paid on December 31, 2015 in respect of its Series A Preferred Stock and its Series B Preferred Stock and (b) the issuance on January 28, 2016, as a dividend on the Company’ common stock, of the right to purchase Series C Junior Participating Preferred Stock pursuant to the Company’s Rights Agreement dated as of January 18, 2016 (the “Rights Agreement”) as part of the Company’s previously disclosed tax benefits preservation plan. The Revolving Credit Facility was also amended to permit the Company to make dividends and distributions of preferred equity interests or rights to purchase certain preferred equity interests. The entry into Amendment No. 7 permitted the Company to pay monthly cash dividends on its Series A Preferred Stock and its Series B Preferred Stock on February 1, 2016. On March 9, 2016, the Company, together with the parties thereto, entered into Waiver and Amendment No. 8 to Second Amended and Restated Credit Agreement (“Amendment No. 8”). Pursuant to Amendment No. 8, the Company obtained the following relief with respect to its financial covenant compliance: (i) a permanent waiver of the defaults at December 31, 2015 of its leverage ratio and senior secured leverage ratio under the Revolving Credit Facility; (ii) relief from compliance with its leverage ratio through the fiscal quarter ending March 31, 2017, but the Company must maintain a maximum leverage ratio of not greater than 4.0 to 1.0 for each fiscal quarter ending on or after June 30, 2017; (iii) an adjustment to the interest coverage ratio for each fiscal quarter ending on or after June 30, 2016 but prior to June 30, 2017, to 1.10 to 1.00 and for each fiscal quarter ending on or after June 30, 2017 to 2.50 to 1.00; and (iv) an adjustment to its senior secured leverage ratio for each fiscal quarter ending on or after June 30, 2016 but prior to June 30, 2017, to 2.50 to 1.00 provided that during such period the Company may subtract all cash on hand in calculating the senior secured leverage ratio for such periods and for each fiscal quarter ending on or after June 30, 2017, to 2.00 to 1.00 provided that during such period the Company may only subtract up to $5 million of cash on hand in calculating the senior secured leverage ratio for such periods. As consideration for the financial covenant relief provided for in Amendment No. 8, the Revolving Credit Facility was also amended to, among other things: (i) set the interest margin at (a) 4.0% per annum for Eurodollar rate borrowings and (b) 3.0% per annum for borrowings based on the reference rate; (ii) reduce the borrowing base from $200.0 million to $180.0 million until the earlier of the closing of the Appalachian Basin Sale or April 10, 2016, at which point the borrowing base would automatically be reduced to $100.0 million and require borrowings in excess of such amount be repaid immediately; (iii) require additional automatic reductions of the borrowing base in connection with asset sales in excess of $5.0 million or the termination of any hedge agreements governing hedges with a settlement date on or after July 1, 2016; (iv) provide for an additional interim borrowing base redetermination in August 2016; (v) require the consent of the lenders to any asset sales in excess of $5.0 million; and (vi) restrict the Company after March 2016 from making any distributions or paying any cash dividends to the holders of its preferred equity, including its outstanding shares of Series A Preferred Stock and Series B Preferred Stock. On October 14, 2016, the Company, together with the parties thereto, entered into Amendment No. 9, which amended the Revolving Credit Facility to, among other things: (i) reaffirm the borrowing base at $100.0 million with next redetermination scheduled for November 2016; (ii) add a mandatory prepayment provision that requires prepayment of the Revolving Credit Facility by an amount equal to 20% of any future net sales proceeds from the sale of the Company’s South STACK Play acreage primarily located in Canadian County, Oklahoma; (iii) to adjust the minimum interest coverage ratio to: (i) 0.8 to 1.0 for fourth quarter 2016 and first quarter 2017, (ii) 1.0 to 1.0 for second quarter 2017 and (iii) 2.50 to 1.0 thereafter, each as determined using adjusted EBITDA for previous four quarters; and (iv) to accommodate the Drilling Program. Borrowing base redeterminations are scheduled semi-annually in May and November of each calendar year. The Company and its lenders may each request one additional unscheduled redetermination during any six-month period between scheduled redeterminations. The next borrowing base redetermination is scheduled for November 2016. In connection with Amendment No. 8 and in conjunction with the closing of the Appalachian Basin Sale, the borrowing base was reduced from $180.0 million to $100.0 million on April 8, 2016. The borrowing base was reaffirmed at $100.0 million on October 14, 2016 in connection with Amendment No. 9. At September 30, 2016, the Revolving Credit Facility had a borrowing base of $100.0 million, with $99.6 million borrowings outstanding and $370,000 of letters of credit issued under the Revolving Credit Facility. As of November 1, 2016, there were $99.6 million borrowings outstanding and $370,000 of letters of credit issued under the Revolving Credit Facility. Future increases in the borrowing base in excess of the original $50.0 million are limited to 17.5% of the increase in adjusted consolidated net tangible assets as defined in the indenture pursuant to which the Company's senior secured notes are issued (as discussed below in “Senior Secured Notes”). On May 10, 2016, the requisite lenders under the Second Amended and Restated Credit Agreement permanently waived an unintended technical default under the Revolving Credit Facility resulting from the timing of the last monthly cash dividend payments made by the Company in March 2016 on the Company’s two outstanding classes of preferred stock. At September 30, 2016, the Company was in compliance with all financial covenants under the Revolving Credit Facility. Senior Secured Notes The Company has $325.0 million aggregate principal amount of 8.625% Senior Secured Notes due May 15, 2018 (the “Notes”) outstanding under an indenture (the “Indenture”) by and among the Company, the Guarantors named therein (the “Guarantors”), Wells Fargo Bank, National Association, as Trustee (in such capacity, the “Trustee”) and Collateral Agent (in such capacity, the “Collateral Agent”). The Notes bear interest at a rate of 8.625% per year, payable semi-annually in arrears on May 15 and November 15 of each year. The Notes mature on May 15, 2018. Effective May 17, 2016, Wells Fargo Bank, National Association resigned as Trustee and Collateral Agent and Wilmington Trust was appointed Trustee and Collateral Agent pursuant to the Indenture. In the event of a change of control, as defined in the Indenture, each holder of the Notes have the right to require the Company to repurchase all or any part of their notes at an offer price in cash equal to 101% of the aggregate principal amount thereof, plus accrued and unpaid interest, if any, to the date of purchase. The Notes are guaranteed, jointly and severally, on a senior secured basis by certain future domestic subsidiaries (the “Guarantees”). The Notes and Guarantees rank senior in right of payment to all of the Company’s and the Guarantors’ future subordinated indebtedness and equal in right of payment to all of the Company’s and the Guarantors’ existing and future senior indebtedness. The Notes and Guarantees also are effectively senior to the Company’s unsecured indebtedness and effectively subordinated to the Company’s and Guarantors’ under the Revolving Credit Facility, any other indebtedness secured by a first-priority lien on the same collateral and any other indebtedness secured by assets other than the collateral, in each case to the extent of the value of the assets securing such obligation. The Indenture contains covenants that, among other things, limit the Company’s ability and the ability of its subsidiaries to: • Transfer or sell assets or use asset sale proceeds; • Pay dividends or make distributions, redeem subordinated debt or make other restricted payments; • Make certain investments; incur or guarantee additional debt or issue preferred equity securities; • Create or incur certain liens on the Company’s assets; • Incur dividend or other payment restrictions affecting future restricted subsidiaries; • Merge, consolidate or transfer all or substantially all of the Company’s assets; • Enter into certain transactions with affiliates; and • Enter into certain sale and leaseback transactions. Covenants in the Indenture also limit the Company’s ability to borrow on a first priority lien secured basis, including its ability to refinance the full amount of currently outstanding borrowings under its Revolving Credit Facility or to re-borrow on such facility in the event current borrowings thereunder are paid down. These and other covenants that are contained in the Indenture are subject to important limitations and qualifications that are described in the Indenture. A summary of the Notes balance for the periods indicated is as follows: September 30, 2016 December 31, 2015 (in thousands) Notes, principal balance $ 325,000 $ 325,000 Less: Unamortized discounts (5,070 ) (7,151 ) Deferred financing costs (940 ) (1,373 ) Notes, net $ 318,990 $ 316,476 |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 30, 2016 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | 5. Fair Value Measurements The Company’s financial assets and liabilities are measured at fair value on a recurring basis. The Company discloses its recognized non-financial assets and liabilities, such as asset retirement obligations, unproved properties and other property and equipment, at fair value on a non-recurring basis. For non-financial assets and liabilities, the Company is required to disclose information that enables users of its financial statements to assess the inputs used to develop these measurements. The Company assesses its unproved properties for impairment whenever events or circumstances indicate the carrying value of those properties may not be recoverable. The fair value of the unproved properties is measured using an income approach based upon internal estimates of future production levels, current and future prices, drilling and operating costs, discount rates, current drilling plans and favorable and unfavorable drilling activity on the properties being evaluated and/or adjacent properties or estimated market data based on area transactions, which are Level 3 inputs. There was no impairment of unproved properties for the three months ended September 30, 2016 and 2015. For the nine months ended September 30, 2016 and 2015, respectively, due to continued lower natural gas prices for dry gas and no current plans to drill or extend leases in Marcellus East, management’s evaluation of unproved properties resulted in impairment and the Company reclassified an immaterial amount of costs from unproved to proved properties for each period. As no other fair value measurements are required to be recognized on a non-recurring basis at September 30, 2016, no additional disclosures are provided at September 30, 2016. As defined in the guidance, fair value is the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (an exit price). To estimate fair value, the Company utilizes market data or assumptions that market participants would use in pricing the asset or liability, including assumptions about risk and the risks inherent in the inputs to the valuation technique. These inputs can be readily observable, market corroborated or generally unobservable. The guidance establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted market prices in active markets for identical assets or liabilities (“Level 1”) and the lowest priority to unobservable inputs (“Level 3”). The three levels of the fair value hierarchy are as follows: • Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities. The Company’s cash equivalents consist of short-term, highly liquid investments, which have maturities of 90 days or less, including sweep investments and money market funds. • Level 2 inputs are quoted prices for similar assets and liabilities in active markets or inputs that are observable for the asset or liability, either directly or indirectly through market corroboration, for substantially the full term of the financial instrument. • Level 3 inputs are measured based on prices or valuation models that require inputs that are both significant to the fair value measurement and less observable from objective sources. These inputs may be used with internally developed methodologies or third party broker quotes that result in management’s best estimate of fair value. The Company’s valuation models consider various inputs including (a) quoted forward prices for commodities, (b) time value, (c) volatility factors and (d) current market and contractual prices for the underlying instruments. Significant increases or decreases in any of these inputs in isolation would result in a significantly higher or lower fair value measurement. Level 3 instruments are commodity costless collars, index swaps, basis and fixed price swaps and put and call options to hedge natural gas, oil and NGLs price risk. At each balance sheet date, the Company performs an analysis of all applicable instruments and includes in Level 3 all of those whose fair value is based on significant unobservable inputs. The fair values derived from counterparties and third-party brokers are verified by the Company using publicly available values for relevant NYMEX futures contracts and exchange traded contracts for each derivative settlement location. Although such counterparty and third-party broker quotes are used to assess the fair value of its commodity derivative instruments, the Company does not have access to the specific assumptions used in its counterparties valuation models. Consequently, additional disclosures regarding significant Level 3 unobservable inputs were not provided and the Company does not currently have sufficient corroborating market evidence to support classifying these contracts as Level 2 instruments. As required, financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. The Company’s assessment of the significance of a particular input to the fair value measurement requires judgment and may affect the valuation of fair value assets and liabilities and their placement within the fair value hierarchy levels. The determination of the fair values below incorporates various factors, including the impact of the counterparty’s non-performance risk with respect to the Company’s financial assets and the Company’s non-performance risk with respect to the Company’s financial liabilities. The Company has not elected to offset the fair value amounts recognized for multiple derivative instruments executed with the same counterparty, but reports them gross on its consolidated balance sheets. Transfers between levels are recognized at the end of the reporting period. There were no transfers between levels during the 2016 and 2015 periods. The following tables set forth by level within the fair value hierarchy the Company’s financial assets and liabilities that were accounted for at fair value on a recurring basis as of September 30, 2016 and December 31, 2015: Fair value as of September 30, 2016 Level 1 Level 2 Level 3 Total (in thousands) Assets: Cash and cash equivalents $ 46,739 $ — $ — $ 46,739 Commodity derivative contracts — — 9,155 9,155 Liabilities: Commodity derivative contracts — — (102 ) (102 ) Total $ 46,739 $ — $ 9,053 $ 55,792 Fair value as of December 31, 2015 Level 1 Level 2 Level 3 Total (in thousands) Assets: Cash and cash equivalents $ 50,074 $ — $ — $ 50,074 Commodity derivative contracts — — 24,869 24,869 Liabilities: Commodity derivative contracts — — (451 ) (451 ) Total $ 50,074 $ — $ 24,418 $ 74,492 The table below presents a reconciliation of the assets and liabilities classified as Level 3 in the fair value hierarchy for the three and nine months ended September 30, 2016 and 2015. Level 3 instruments presented in the table consist of net derivatives that, in management’s opinion, reflect the assumptions a marketplace participant would have used at September 30, 2016 and 2015. Three Months Ended September 30, Nine Months Ended September 30, 2016 2015 2016 2015 (in thousands) Balance at beginning of period $ 12,782 $ 22,373 $ 24,418 $ 27,502 Total (losses) gains included in earnings (1,498 ) 11,301 (3,991 ) 19,734 Purchases — 415 565 1,326 Issuances — — (165 ) (1,313 ) Settlements (1) (2,231 ) (6,793 ) (11,774 ) (19,953 ) Balance at end of period $ 9,053 $ 27,296 $ 9,053 $ 27,296 The amount of total (losses) gains for the period included in earnings attributable to the change in mark to market of commodity derivatives contracts still held at September 30, 2016 and 2015 $ (3,134 ) $ 4,511 $ (12,974 ) $ 986 (1) Included in gain (loss) on commodity derivatives contracts on the condensed consolidated statements of operations. At September 30, 2016, the estimated fair value of accounts receivable, prepaid expenses, accounts and revenue payables and accrued liabilities approximates their carrying value due to their short-term nature. The estimated fair value of the Company’s long-term debt at September 30, 2016 was $366.3 million based on quoted market prices of the Notes (Level 1) and the respective carrying value of the Revolving Credit Facility because the interest rate approximates the current market rate (Level 2). The Company has consistently applied the valuation techniques discussed above in all periods presented. The fair value guidance, as amended, establishes that every derivative instrument is to be recorded on the balance sheet as either an asset or liability measured at fair value. See Note 6, “Derivative Instruments and Hedging Activity.” |
Derivative Instruments and Hedg
Derivative Instruments and Hedging Activity | 9 Months Ended |
Sep. 30, 2016 | |
Derivative Instruments And Hedging Activities Disclosure [Abstract] | |
Derivative Instruments and Hedging Activity | 6. Derivative Instruments and Hedging Activity The Company maintains a commodity price risk management strategy that uses derivative instruments to minimize significant, unanticipated earnings fluctuations that may arise from volatility in commodity prices. The Company uses costless collars, index, basis and fixed price swaps and put and call options to hedge oil, condensate, natural gas and NGLs price risk. All derivative contracts are carried at their fair value on the balance sheet and all changes in value are recorded in the condensed consolidated statements of operations in (loss) gain on commodity derivatives contracts. For the three months ended September 30, 2016 and 2015, the Company reported a loss of $3.1 million and a gain of $4.5 million, respectively, in the condensed consolidated statements of operations related to the change in the fair value of its commodity derivative contracts still held at September 30, 2016 and 2015. For the nine months ended September 30, 2016 and 2015, the Company reported a loss of $13.0 million and a gain of $986,000, respectively, in the condensed consolidated statements of operations related to the change in the fair value of its commodity derivative contracts still held at September 30, 2016 and 2015. As of September 30, 2016, the following crude derivative transactions were outstanding with the associated notional volumes and weighted average underlying hedge prices: Settlement Period Derivative Instrument Average Daily Volume (1) Total of Notional Volume Base Fixed Price Floor (Long) Short Put Ceiling (Short) (in Bbls) 2016 Costless three-way collar 250 30,500 $ — $ 85.00 $ 65.00 $ 95.10 2016 Costless three-way collar 330 40,260 $ — $ 80.00 $ 65.00 $ 97.35 2016 Costless three-way collar 450 54,900 $ — $ 57.50 $ 42.50 $ 80.00 2016 Put spread 550 67,100 $ — $ 85.00 $ 65.00 $ — 2016 Fixed price swap 300 36,600 $ 56.30 $ — $ — $ — 2016 Fixed price swap 200 24,400 $ 50.00 $ — $ — $ — 2017 Costless three-way collar 280 102,200 $ — $ 80.00 $ 65.00 $ 97.25 2017 Costless three-way collar 250 91,250 $ — $ 80.00 $ 60.00 $ 98.70 2017 (2) Protective spread 200 36,200 $ 60.00 $ — $ 42.50 $ — 2017 Put spread 500 182,500 $ — $ 82.00 $ 62.00 $ — 2017 (2) Protective spread 200 36,200 $ 57.50 $ — $ 42.50 $ — 2017 (2) Fixed price swap 300 54,300 $ 50.10 $ — $ — $ — 2017 (3) Costless three-way collar 200 36,800 $ — $ 60.00 $ 42.50 $ 85.00 2017 (3) Costless three-way collar 200 36,800 $ — $ 57.50 $ 42.50 $ 76.13 2017 (4) Fixed price swap 200 18,000 $ 50.05 $ — $ — $ — 2018 (5) Put spread 425 103,275 $ — $ 80.00 $ 60.00 $ — (1) Crude volumes hedged include oil, condensate and certain components of our NGLs production. (2) For the period January to June 2017. (3) For the period July to December 2017. (4) For the period January to March 2017. (5) For the period January to August 2018. As of September 30, 2016, the following natural gas derivative transactions were outstanding with the associated notional volumes and weighted average underlying hedge prices: Settlement Period Derivative Instrument Average Daily Volume Total of Notional Volume Floor (Long) Short Put Ceiling (Short) (in MMBtus) 2016 (1) Costless three-way collar 2,500 77,500 $ 3.00 $ 2.25 $ 3.65 2016 Costless three-way collar 2,000 184,000 $ 4.00 $ 3.25 $ 4.58 2016 Costless three-way collar 5,000 460,000 $ 3.40 $ 2.65 $ 4.10 2017 Costless three-way collar 5,000 1,825,000 $ 3.00 $ 2.35 $ 4.00 2017 (2) Costless collar 2,000 180,000 $ 3.10 $ — $ 3.78 2018 Costless three-way collar 5,000 1,825,000 $ 3.00 $ 2.35 $ 4.00 (1) For the month of October 2016. (2) For the period January to March 2017. As of September 30, 2016, the following NGLs derivative transactions were outstanding with the associated notional volumes and weighted average underlying hedge prices: Settlement Period Derivative Instrument Average Daily Volume Total of Notional Volume Base Fixed Price (in Bbls) 2016 Fixed price swap 500 61,000 $ 20.79 As of September 30, 2016, all of the Company’s economic derivative hedge positions were with large financial institutions, which are not known to the Company to be in default on their derivative positions. The Company is exposed to credit risk to the extent of non-performance by the counterparties in the derivative contracts discussed above; however, the Company does not anticipate non-performance by such counterparties. None of the Company’s derivative instruments contain credit-risk related contingent features. In conjunction with certain derivative hedging activity, the Company has deferred the payment of certain put premiums for the production month period October 2016 through December 2018. The put premium liabilities become payable monthly as the hedge production month becomes the prompt production month. The Company amortizes the deferred put premium liabilities as they become payable. The following table provides information regarding the deferred put premium liabilities for the periods indicated: September 30, 2016 December 31, 2015 (in thousands) Current commodity derivative put premium payable $ 1,750 $ 3,194 Long-term commodity derivative put premium payable 1,427 2,788 Total unamortized put premium liabilities $ 3,177 $ 5,982 For the Three Months Ended September 30, 2016 For the Nine Months Ended September 30, 2016 (in thousands) Put premium liabilities, beginning balance $ 3,546 $ 5,982 Settlement of put premium liabilities (369 ) (2,640 ) Additional put premium liabilities — (165 ) Put premium liabilities, ending balance $ 3,177 $ 3,177 The following table provides information regarding the amortization of the deferred put premium liabilities by year as of September 30, 2016: Amortization (in thousands) October to December 2016 $ 554 January to December 2017 1,654 January to August 2018 969 Total unamortized put premium liabilities $ 3,177 Additional Disclosures about Derivative Instruments and Hedging Activities The tables below provide information on the location and amounts of derivative fair values in the condensed consolidated statement of financial position and derivative gains and losses in the condensed consolidated statement of operations for derivative instruments that are not designated as hedging instruments: Fair Values of Derivative Instruments Derivative Assets (Liabilities) Fair Value Balance Sheet Location September 30, 2016 December 31, 2015 (in thousands) Derivatives not designated as hedging instruments Commodity derivative contracts Current assets $ 5,240 $ 15,534 Commodity derivative contracts Other assets 3,915 9,335 Commodity derivative contracts Current liabilities (102 ) — Commodity derivative contracts Long-term liabilities — (451 ) Total derivatives not designated as hedging instruments $ 9,053 $ 24,418 Amount of Gain (Loss) Recognized in Income on Derivatives For the Three Months Ended September 30, Location of Gain (Loss) Recognized in Income on Derivatives 2016 2015 (in thousands) Derivatives not designated as hedging instruments Commodity derivative contracts (Loss) gain on commodity derivatives contracts $ (1,498 ) $ 11,301 Total $ (1,498 ) $ 11,301 Amount of Gain (Loss) Recognized in Income on Derivatives For the Nine Months Ended September 30, Location of (Gain) Loss Recognized in Income on Derivatives 2016 2015 (in thousands) Derivatives not designated as hedging instruments Commodity derivative contracts (Loss) gain on commodity derivatives contracts $ (3,991 ) $ 19,734 Total $ (3,991 ) $ 19,734 |
Capital Stock
Capital Stock | 9 Months Ended |
Sep. 30, 2016 | |
Stockholders Equity Note [Abstract] | |
Capital Stock | 7. Capital Stock Common Stock On May 7, 2015, the Company entered into an at-the-market issuance sales agreement with MLV & Co. LLC (the “Sales Agent”) to sell, from time to time through the Sales Agent, shares of the Company's common stock (the “ATM Program”). The shares will be issued pursuant to the Company's existing effective shelf registration statement on Form S-3, as amended (Registration No. 333-193832). The Company registered shares having an aggregate offering price of up to $50.0 million. To date, no shares have been sold through the ATM Program. On May 12, 2016, the Company sold 50,000,000 shares of its common stock in an underwritten public offering at a price of $0.95 per share, or $47.5 million before offering costs and expenses (the “Equity Offering”). The Company received approximately $44.8 million of proceeds from the offering, net of offering costs and expenses of approximately $2.7 million. On June 14, 2016, the Company’s stockholders approved an amendment to the Company’s certificate of incorporation to increase the number of authorized shares of common stock from 275,000,000 to 550,000,000, which amendment became effective on July 5, 2016. Stockholder Rights Agreement On January 18, 2016, the Company’s Board of Directors adopted the Rights Agreement pursuant to which the Company declared a dividend of one right (a “Right”) for each of the Company’s issued and outstanding shares of common stock. The dividend was paid to stockholders of record on January 28, 2016. Each Right entitles the holder, subject to the terms of the Rights Agreement, to purchase one one-thousandth of a share of the Company’s Series C Junior Participating Preferred Stock (the “Series C Preferred Stock”) at a price of $6.96, subject to certain adjustments. The purpose of the Rights Agreement is to diminish the risk that the Company’s ability to reduce potential future federal income tax obligations would become subject to limitations by reason of an “ownership change,” as defined in Section 382 of the Internal Revenue Code of 1986, as amended. The Rights generally become exercisable on the earlier of (i) ten business days after any person or group obtains beneficial ownership of 4.9% of the Company’s outstanding common stock (an “Acquiring Person”) or (ii) ten business days after commencement of a tender or exchange offer resulting in any person or group becoming an Acquiring Person. The exercise price payable, and the number of shares of Series C Preferred Stock or other securities or property issuable, upon exercise of the Rights are subject to adjustment from time to time to prevent dilution. In the event that, after a person or a group has become an Acquiring Person, the Company is acquired in a merger or other business combination transaction (or 50% or more of the Company’s assets or earning power are sold), proper provision will be made so that each holder of a Right will thereafter have the right to receive, upon the exercise thereof at the then-current exercise price of the Right, that number of shares of common stock of the acquiring company having a market value at the time of that transaction equal to two times the exercise price. The Company may redeem the Rights in whole, but not in part, at any time before a person or group becomes an Acquiring Person at a price of $0.001 per Right, subject to adjustment. At any time after any person or group becomes an Acquiring Person, the Company may generally exchange each Right in whole or in part at an exchange ratio of two shares of common stock per outstanding Right, subject to adjustment. The Rights will expire on January 18, 2019 unless terminated on an earlier date pursuant to the terms of the Rights Agreement. The Series C Preferred Stock is not redeemable by the Company and has certain voting rights and dividend and liquidation privileges. The Rights Agreement was amended on May 11, 2016 to make certain provisions inapplicable to purchasers of the Equity Offering who are approved by the board of directors of the Company, or a committee thereof, so that no such purchaser will be deemed an “Acquiring Person” under the Rights Agreement by virtue of their purchase of common stock in the Equity Offering. Preferred Stock Pursuant to the Company’s certificate of incorporation, the Company has 40,000,000 shares of preferred stock authorized. The Company has designated 10,000,000 of such shares to constitute its 8.625% Series A Cumulative Preferred Stock (the “Series A Preferred Stock”) and 10,000,000 of such shares to constitute its 10.75% Series B Cumulative Preferred Stock (the “Series B Preferred Stock”). The Series A Preferred Stock and the Series B Preferred Stock each have a par value of $0.01 per share and a liquidation preference of $25.00 per share. Series A Preferred Stock At September 30, 2016, there were 4,045,000 shares of the Series A Preferred Stock issued and outstanding with a $25.00 per share liquidation preference. The Series A Preferred Stock ranks senior (to the extent of its stated liquidation preference and any accumulated and unpaid dividends) to the Company's common stock and on parity with the Series B Preferred Stock with respect to the payment of dividends and distribution of assets upon liquidation, dissolution or winding up. The Series A Preferred Stock is subordinated to all of the Company’s existing and future debt and all future capital stock designated as senior to the Series A Preferred Stock. The Series A Preferred Stock cannot be converted into common stock, but may be redeemed, at the Company’s option for $25.00 per share plus any accrued and unpaid dividends whether declared or not. There is no mandatory redemption of the Series A Preferred Stock. The Company paid monthly dividends on the Series A Preferred Stock at a fixed rate of 8.625% per annum of the $25.00 per share liquidation preference through March 2016. Effective March 9, 2016, the Revolving Credit Facility prohibited the payment of cash dividends on the Company’s preferred stock commencing April 2016. Accordingly, the Company did not declare or pay dividends on the Series A Preferred Stock in April 2016 or any subsequent month. Dividends on the Series A Preferred Stock accumulate regardless of whether any such dividends are declared. If the Company fails to pay full cash dividends in four calendar quarters, whether consecutive or non-consecutive, then commencing in the calendar month following the first month in such fourth calendar quarter in which cash dividends are not paid in full, and until accumulated dividends are paid in full for four calendar quarters with the last two calendar quarters’ dividends paid in cash, (i) the fixed dividend rate of Series A Preferred Stock each increases by 2.00% per annum, (ii) the Company may be required to issue a dividend of common stock to pay accrued and unpaid dividends, if such dividends are not paid in cash, provided it has sufficient surplus to pay such a dividend under state law, and (iii) the holders of Series A Preferred Stock and Series B Preferred Stock, voting as a single class, will have the right to elect up to two additional directors to the board of directors of the Company. Under certain circumstances, “pay in kind” dividends of additional shares of Series A Preferred Stock may be payable in lieu of cash or common stock dividends. For the three and nine months ended September 30, 2016, the Company recognized dividends of $2.2 million and $6.6 million, respectively, for the Series A Preferred Stock. Accumulated and unpaid dividends on the outstanding Series A Preferred Stock, which as of September 30, 2016 aggregated $4.4 million, is added to the stated liquidation preference with respect to any preferred distribution of assets upon liquidation, dissolution or winding up. Series B Preferred Stock At September 30, 2016, there were 2,140,000 shares of the Series B Preferred Stock issued and outstanding with a $25.00 per share liquidation preference. The Series B Preferred Stock ranks senior (to the extent of its stated liquidation preference and any accumulated and unpaid dividends) to the Company’s common stock and on parity with the Series A Preferred Stock with respect to the payment of dividends and distribution of assets upon liquidation, dissolution or winding up. The Series B Preferred Stock are subordinated to all of the Company’s existing and future debt and all future capital stock designated as senior to the Series B Preferred Stock. Except upon a change in ownership or control, as defined in the Series B Preferred Stock certificate of designations of rights and preferences, the Series B Preferred Stock may not be redeemed before November 15, 2018, at or after which time it may be redeemed at the Company’s option for $25.00 per share in cash. Following a change in ownership or control, the Company will have the option to redeem the Series B Preferred Stock within 90 days of the occurrence of the change in control, in whole but not in part for $25.00 per share in cash, plus accrued and unpaid dividends (whether or not declared), up to, but not including the redemption date. If the Company does not exercise its option to redeem the Series B Preferred Stock upon a change of ownership or control, the holders of the Series B Preferred Stock have the option to convert the shares of Series B Preferred Stock into the Company's common stock based upon on an average common stock trading price then in effect but limited to an aggregate of 11.5207 shares of the Company’s common stock per share of Series B Preferred Stock, subject to certain adjustments. If the Company exercises any of its redemption rights relating to shares of Series B Preferred Stock, the holders of Series B Preferred Stock will not have the conversion right described above with respect to the shares of Series B Preferred Stock called for redemption. There is no mandatory redemption of the Series B Preferred Stock. The Company paid monthly dividends on the Series B Preferred Stock at a fixed rate of 10.75% per annum of the $25.00 per share liquidation preference through March 2016. Effective March 9, 2016, the Revolving Credit Facility prohibited the payment of cash dividends on the Company’s preferred stock commencing April 2016. Accordingly, the Company did not declare or pay dividends on the Series B Preferred Stock in April 2016 or any subsequent month. Dividends on the Series B Preferred Stock will accumulate regardless of whether any such dividends are declared. If the Company fails to pay full cash dividends in four calendar quarters, whether consecutive or non-consecutive, then commencing in the calendar month following the first month in such fourth calendar quarter in which cash dividends are not paid in full, and until accumulated dividends are paid in full for four calendar quarters with the last two calendar quarters’ dividends paid in cash, (i) the fixed dividend rate of Series B Preferred Stock each increases by 2.00% per annum, (ii) the Company may be required to issue a dividend of common stock to pay accrued and unpaid dividends, if such dividends are not paid in cash, provided it has sufficient surplus to pay such a dividend under state law, and (iii) the holders of Series A Preferred Stock and Series B Preferred Stock, voting as a single class, will have the right to elect up to two additional directors to the board of directors of the Company. Under certain circumstances, “pay in kind” dividends of additional shares of Series B Preferred Stock may be payable in lieu of cash or common stock dividends. For the three and nine months ended September 30, 2016, the Company recognized dividends of $1.4 million and $4.3 million, respectively, for the Series B Preferred Stock. Accumulated and unpaid dividends on the outstanding Series B Preferred Stock, which as of September 30, 2016 aggregated $2.9 million, is added to the stated liquidation preference with respect to any preferred distribution of assets upon liquidation, dissolution or winding up. No shares of Series C Preferred Stock have been issued by the Company pursuant to the Rights Agreement described above or otherwise. Other Share Issuances The following table provides information regarding the issuances and forfeitures of common stock pursuant to the Company's long-term incentive plan for the periods indicated: For the Three Months Ended September 30, 2016 For the Nine Months Ended September 30, 2016 Other share issuances: Shares of restricted common stock granted — 1,714,645 Shares of restricted common stock vested 33,075 1,472,915 Shares of common stock issued pursuant to PBUs vested, net of forfeitures — 502,593 Shares of restricted common stock surrendered upon vesting/exercise (1) 3,664 389,905 Shares of restricted common stock forfeited — 126,336 (1) Represents shares of common stock forfeited in connection with the payment of estimated withholding taxes on shares of restricted common stock that vested during the period. On June 12, 2014, the Company's stockholders approved an amendment and restatement to the Gastar Exploration Inc. Long-Term Incentive Plan (the “LTIP”), effective April 24, 2014, to, among other things, increase the number of shares of common stock reserved for issuance under the LTIP by 3,000,000 shares of common stock. There were 1,636,039 shares of common stock available for issuance under the LTIP at September 30, 2016. Shares Reserved At September 30, 2016, the Company had 214,600 common shares reserved for the exercise of stock options. |
Interest Expense
Interest Expense | 9 Months Ended |
Sep. 30, 2016 | |
Interest Expense [Abstract] | |
Interest Expense | 8. Interest Expense The following table summarizes the components of interest expense for the periods indicated: For the Three Months Ended September 30, For the Nine Months Ended September 30, 2016 2015 2016 2015 (in thousands) Interest expense: Cash and accrued $ 8,158 $ 7,703 $ 25,275 $ 22,872 Amortization of deferred financing costs (1) 986 916 3,812 2,652 Capitalized interest (966 ) (686 ) (2,348 ) (3,094 ) Total interest expense $ 8,178 $ 7,933 $ 26,739 $ 22,430 (1) The three months ended September 30, 2016 and 2015 includes $711,000 and $644,000, respectively, of debt discount accretion related to the Notes. The nine months ended September 30, 2016 and 2015 includes $2.1 million and $1.9 million, respectively, of debt discount accretion related to the Notes. |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2016 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 9. Income Taxes For the three and nine months ended September 30, 2016 and 2015, respectively, the Company did not recognize a current income tax benefit or provision as the Company has a full valuation allowance against assets created by net operating losses generated. The Company believes it more likely than not that the assets will not be utilized. |
Earnings per Share
Earnings per Share | 9 Months Ended |
Sep. 30, 2016 | |
Earnings Per Share [Abstract] | |
Earnings per Share | 10. Earnings per Share In accordance with the provisions of current authoritative guidance, basic earnings or loss per share is computed on the basis of the weighted average number of common shares outstanding during the periods. Diluted earnings or loss per share is computed based upon the weighted average number of common shares outstanding plus the assumed issuance of common shares for all potentially dilutive securities. For the Three Months Ended September 30, For the Nine Months Ended September 30, 2016 2015 2016 2015 (in thousands, except per share and share data) Net loss attributable to common stockholders $ (3,796 ) $ (191,819 ) $ (95,371 ) $ (312,837 ) Weighted average common shares outstanding - basic 129,301,817 77,628,120 104,125,317 77,453,251 Incremental shares from unvested restricted shares — — — — Incremental shares from outstanding stock options — — — — Incremental shares from outstanding PBUs — — — — Weighted average common shares outstanding - diluted 129,301,817 77,628,120 104,125,317 77,453,251 Net loss per share of common stock attributable to common stockholders: Basic $ (0.03 ) $ (2.47 ) $ (0.92 ) $ (4.04 ) Diluted $ (0.03 ) $ (2.47 ) $ (0.92 ) $ (4.04 ) Common shares excluded from denominator as anti-dilutive: Unvested restricted shares 170,362 239,161 540,994 146,253 Unvested PBUs 1,041,493 503,271 837,199 84,179 Total 1,211,855 742,432 1,378,193 230,432 |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2016 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 11. Commitments and Contingencies Litigation Gastar Exploration Ltd vs. U.S. Specialty Ins. Co. and Axis Ins. Co. (Cause No.2010-11236) District Court of Harris County, Texas 190th Judicial District. On February 19, 2010, the Company filed a lawsuit claiming that the Company was due reimbursement of qualifying claims related to the settlement and associated legal defense costs under the Company's directors and officers liability insurance policies related to the ClassicStar Mare Lease Litigation settled on December 17, 2010 for $21.2 million. The combined coverage limits under the directors and officers liability coverage was $20.0 million. The District Court granted the underwriters' summary judgment request by a ruling dated January 4, 2012. The Company appealed the District Court ruling and on July 15, 2013. The Fourteenth Court of Appeals of Texas reversed the summary judgment ruling granted against the Company on the basis of the policies' prior-and-pending litigation endorsement and remanded the case for further proceedings in the District Court. The insurers filed a motion for reconsideration in the Fourteenth Court of Appeals, which that court denied. The insurers then sought discretionary review from the Texas Supreme Court, which that court denied on February 27, 2015. The insurers then filed in the Texas Supreme Court a motion for rehearing of their denied petition for review, which the court denied. The case was remanded to the District Court for trial. In October 2015, the Insurers sought a summary judgment based on one of the exclusions in the policy. The trial court denied their motion. After denying the insurers’ motion for summary judgment, the trial court, on February 17, 2016, entered a docket control order establishing the week of November 29, 2016 as the tentative week for the case to go to trial. The parties engaged in coverage-related discovery for approximately nine months. On August 10, 2016, Gastar and the insurers settled their coverage dispute for $10.1 million. Insurers’ settlement payments to Gastar were paid in September 2016 and were recorded as litigation settlement benefit in the statement of operations at September 30, 2016. Gastar Exploration Inc. v. Christopher McArthur (Cause No.: 2015-77605) 157th Judicial District Court, Harris County, Texas. On December 29, 2015, Gastar filed suit against Christopher McArthur (“McArthur”) in the District Court of Harris County, Texas. The lawsuit arises from a demand letter sent by McArthur to Gastar in which he claimed to be party to an agreement with Gastar that entitled him to be paid $2.75 million for services rendered. In August 2016, McArthur filed an amended answer admitting he had no agreement with the Company. As a result, Gastar believes McArthur’s claim has been effectively resolved. Gastar has continued to pursue a counterclaim in this action against McArthur for tortious interference with an existing contract. McArthur has filed a general denial. Torchlight Energy Resources, Inc., Torchlight Energy, Inc. v. Husky Ventures, Inc., et al., (Cause No. 429-01961-2016) 429th Judicial District Court in Collin County, Texas. Torchlight Energy Resources, Inc. and Torchlight Energy, Inc. (collectively “Torchlight”) brought a lawsuit against the Company, two of its executive officers, its chairman of the board of directors and a former director of the Company on May 3, 2016 in Collin County, Texas (the “Torchlight Lawsuit”). The Torchlight Lawsuit arises primarily out of Torchlight’s business dealings with Husky in Oklahoma. Husky and several of its employees and affiliates are also defendants in the Torchlight Lawsuit. As part of settlement negotiations between Husky and the Company in a separate lawsuit, Husky informed the Company that it had agreed to repurchase assets from Torchlight that Husky had previously sold to Torchlight (the “Torchlight Assets”). Husky offered to sell those Torchlight Assets to the Company. In the Purchase and Sale Agreement between Torchlight and Husky, Torchlight expressly acknowledged that the Torchlight Assets were to be sold to the Company and released the Company from any claims arising out of the sale of the Torchlight Assets. Despite this release, Torchlight has alleged multiple causes of action against the Company and its officers and directors arising out of the sale of the Torchlight Assets and Torchlight’s other business dealings it had with Husky. The Company has filed a counterclaim against Torchlight for breach of the release in the Purchase and Sale Agreement. Torchlight has dropped their claims, without prejudice, against the former director of the Company, but continues to assert claims against the remaining Gastar defendants. The Company believes the plaintiffs’ claims are without merit and are merely an attempt to induce the Company into settling disputes that are primarily between Torchlight and Husky. The Company intends to defend this case vigorously. The Company has been expensing legal costs on these proceedings as they are incurred. The Company is party to various legal proceedings arising in the normal course of business. The ultimate outcome of each of these matters cannot be absolutely determined, and the liability the Company may ultimately incur with respect to any one of these matters in the event of a negative outcome may be in excess of amounts currently accrued for with respect to such matters. Net of available insurance and performance of contractual defense and indemnity obligations, where applicable, management does not believe any such matters will have a material adverse effect on the Company’s financial position, results of operations or cash flows. |
Statement of Cash Flows - Suppl
Statement of Cash Flows - Supplemental Information | 9 Months Ended |
Sep. 30, 2016 | |
Supplemental Cash Flow Information [Abstract] | |
Statement of Cash Flows - Supplemental Information | 12. Statement of Cash Flows – Supplemental Information The following is a summary of the supplemental cash paid and non-cash transactions for the periods indicated: For the Nine Months Ended September 30, 2016 2015 (in thousands) Cash paid for interest, net of capitalized amounts $ 16,140 $ 12,699 Non-cash transactions: Capital expenditures included in (excluded from) accounts payable and accrued drilling costs $ 4,913 $ (12,396 ) Capital expenditures included in accounts receivable $ 409 $ — Asset retirement obligation included in oil and natural gas properties $ 128 $ 276 Asset retirement obligation sold $ (694 ) $ — Preferred dividends accrued but not declared $ 7,237 $ — Application of advances to operators $ (378 ) $ 11,113 Expenses accrued for the issuance of common stock $ 2 $ — |
Summary of Significant Accoun18
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2016 | |
Accounting Policies [Abstract] | |
Basis of Accounting | The unaudited interim condensed consolidated financial statements of the Company included herein are stated in U.S. dollars and were prepared from the records of the Company by management in accordance with U.S. GAAP applicable to interim financial statements and reflect all normal and recurring adjustments, which are, in the opinion of management, necessary to provide a fair presentation of the results of operations and financial position for the interim periods. Such financial statements conform to the presentation reflected in the 2015 Form 10-K. The current interim period reported herein should be read in conjunction with the financial statements and accompanying notes, including Item 8. “Financial Statements and Supplementary Data, Note 2 – Summary of Significant Accounting Policies,” included in the 2015 Form 10-K. |
Subsequent Events | Subsequent Events In preparing these financial statements, the Company has evaluated events and transactions for potential recognition or disclosure through the date the financial statements were issued and has disclosed certain subsequent events in these condensed consolidated financial statements, as appropriate. Revolving Credit Facility On October 14, 2016, the Company, together with the parties thereto, entered into Amendment No. 9 to Second Amended and Restated Credit Agreement (“Amendment No. 9”), which amended the Revolving Credit Facility to, among other things: (i) reaffirm the borrowing base at $100.0 million with next redetermination scheduled for November 2016; (ii) add a mandatory prepayment provision that requires prepayment of the Revolving Credit Facility (as defined below) by an amount equal to 20% of any future net sales proceeds from the sale of the Company’s South STACK Play acreage primarily located in Canadian County, Oklahoma; (iii) to adjust the minimum interest coverage ratio to: (i) 0.8 to 1.0 for fourth quarter 2016 and first quarter 2017, (ii) 1.0 to 1.0 for second quarter 2017 and (iii) 2.50 to 1.0 thereafter, each as determined using adjusted EBITDA for previous four quarters; and (iv) to accommodate the Drilling Program (as defined below). Development Agreement On October 14, 2016, the Company executed a definitive agreement with STACK Exploration LLC, a Delaware limited liability company, (the “Investor”) to jointly develop up to 60 Gastar operated wells in the STACK Play in Kingfisher County, Oklahoma (the “Development Agreement”). The drilling program (the “Drilling Program”) will target the Meramec and Osage formations within the Mississippi Lime on a contract area within three townships covering approximately 18,000 undeveloped net mineral acres under leases held by the Company. The Company will be the operator of all wells jointly developed under the Development Agreement. Under the Development Agreement, the Investor will fund 90% of Gastar’s working interest portion of drilling and completion costs to initially earn 80% of Gastar’s working interest in each new well (in each case, proportionately reduced by other participating working interests in the well). As a result, Gastar will pay 10% of its working interest portion of such costs for 20% of its original working interest. The proposed Drilling Program wells will be mutually developed in three tranches of 20 wells each. The locations of the first 20 wells, comprised of 18 Meramec formation wells and two Osage formation wells, have been mutually agreed upon by the Company and the Investor. Participation in the second tranche of 20 Drilling Program wells will be at the election of the Investor and the third tranche of 20 wells will require mutual consent. With respect to each 20 well tranche, when the Investor has achieved an aggregate 15% internal rate of return (“IRR”) for its investment in the tranche, its interest will be reduced from 80% to 40% of Gastar’s original working interest and Gastar’s working interest increases from 20% to 60% of Gastar’s original working interest. When a tranche IRR of 20% is achieved by the Investor, its working interest decreases to 10% and Gastar’s working interest increases to 90% of the working interest originally owned by Gastar. Canadian County Property Sale On October 19, 2016, the Company entered into a purchase and sale agreement to sell certain non-core leasehold interests in approximately 25,300 net acres of which only 19,100 net acres was ascribed allocated value and interests in 25 gross (11.2 net) wells primarily in northeast Canadian County and also in southeast Kingfisher County, Oklahoma to Red Bluff Resources Operating, LLC, a Delaware limited liability company, (“Red Bluff”) for approximately $71.0 million (of which up to $10.0 million is contingent upon the satisfaction of certain conditions), subject to certain adjustments. The transaction is expected to close on or before November 18, 2016, with a property sale effective date of August 1, 2016. |
Accounts Receivable | Accounts Receivable Accounts receivable are reported net of the allowance for doubtful accounts. The allowance for doubtful accounts is determined based on a review of the Company’s receivables. Receivable accounts are charged off when collection efforts have failed or the account is deemed uncollectible. During the quarter ended June 30, 2016, the Company determined that a receivable account from a third-party natural gas and NGLs purchaser would no longer be collectible as a result of the third-party purchaser filing for bankruptcy. A summary of the activity related to the allowance for doubtful accounts is as follows: September 30, 2016 December 31, 2015 (in thousands) Allowance for doubtful accounts, beginning of period $ — $ — Expense — — Reductions/write-offs 1,953 — Allowance for doubtful accounts, end of period $ 1,953 $ — |
Recent Accounting Developments | Recent Accounting Developments The following recently issued accounting pronouncements may impact the Company in future periods: Statement of Cash Flows. In August 2016, the FASB issued updated guidance associated with the classification of certain cash receipts and cash payments on the statement of cash flows. The amended guidance addresses specific cash flow issues with the objective of reducing existing diversity in practice. The amendments in this update apply to all entities required to present a statement of cash flows. The amendments in this update are effective for public business entities for fiscal years beginning after December 15, 2017 and interim periods within those fiscal years. Early adoption is permitted, including adoption in an interim period. If an entity early adopts the amendments in an interim period, any adjustments should be reflected as of the beginning of the fiscal year that includes that interim period. An entity that elects early adoption must adopt all of the amendments in the same period. Amendments should be applied using a retrospective transition method to each period presented. If it is impracticable to apply the amendments retrospectively for some of the issues, the amendments for those issues would be applied prospectively as of the earliest date practicable. The Company has not yet determined what the effects of adopting this updated guidance will be on its statement of cash flows. Compensation – Stock Compensation. In March 2016, the FASB issued updated guidance as part of its simplification initiative which is intended to simplify several aspects of the accounting for stock-based compensation transactions, including the income tax consequences, classification of awards as either equity or liabilities and classification on the statement of cash flows. For public business entities, the amendments in this update are effective for annual periods beginning after December 15, 2016, and interim periods within those annual periods. Early adoption is permitted for any entity in any interim or annual period. If an entity early adopts the amendments in an interim period, any adjustments should be reflected as of the beginning of the fiscal year that includes that interim period. An entity that elects early adoption must adopt all of the amendments in the same period. Amendments related to the timing of when excess tax benefits are recognized, minimum statutory withholding requirements, forfeitures, and intrinsic value should be applied using a modified retrospective transition method by means of a cumulative-effect adjustment to equity as of the beginning of the period in which the guidance is adopted. Amendments related to the presentation of employee taxes paid on the statement of cash flows when an employer withholds shares to meet the minimum statutory withholding requirement should be applied retrospectively. Amendments requiring recognition of excess tax benefits and tax deficiencies in the income statement and the practical expedient for estimating expected term should be applied prospectively. An entity may elect to apply the amendments related to the presentation of excess tax benefits on the statement of cash flows using either a prospective transition method or a retrospective transition method. The Company has not yet determined what the effects of adopting this updated guidance will be on its consolidated financial statements. Leases. In February 2016, the FASB issued updated guidance to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and enhance disclosures regarding key information about leasing arrangements. Under the new guidance, lessees will be required to recognize a lease liability and a right-of-use asset for all leases. The new lease guidance also simplified the accounting for sale and leaseback transactions primarily because lessees must recognize lease assets and lease liabilities. The amendments in this update are effective beginning on January 1, 2019 and should be applied through a modified retrospective transition approach for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. Early adoption is permitted. The Company has not yet determined what the effects of adopting this updated guidance will be on its consolidated financial statements. Income Taxes. In November 2015, the FASB issued updated guidance as part of its simplification initiative for the presentation of deferred taxes. Current U.S. GAAP requires an entity to separate deferred income tax liabilities and assets into current and noncurrent amounts in a classified statement of financial position where such classification generally does not align with the time period in which the recognized deferred tax amounts are expected to be recovered or settled. To simplify the presentation of deferred income taxes, the amendments in this update require that deferred tax liabilities and assets be classified as noncurrent in a classified statement of financial position and apply to all entities that present a classified statement of financial position, resulting in the alignment of the U.S. GAAP presentation of deferred income tax assets and liabilities with International Financial Reporting Standards (IFRS). IAS 1, Presentation of Financial Statements. This guidance is effective for public business entities for financial statements issued for annual periods beginning after December 15, 2016, and interim periods within those annual periods. Earlier application is permitted as of the beginning of an interim or annual reporting period and can be applied either prospectively or retrospectively to all periods presented. The Company does not expect the adoption of this guidance to materially impact its consolidated financial statements. Going Concern. In August 2014, the FASB issued updated guidance related to determining whether substantial doubt exists about an entity's ability to continue as a going concern. The amendment provides guidance for determining whether conditions or events give rise to substantial doubt that an entity has the ability to continue as a going concern within one year following the date of issuance of annual and interim financial statements, and requires specific disclosures regarding the conditions or events leading to substantial doubt. The updated guidance is effective for annual reporting periods ending after December 15, 2016 and for annual periods and interim periods thereafter. Earlier adoption is permitted, but the Company has not elected to adopt the updated guidance early. The Company does not expect the adoption of this guidance to have a material impact on its consolidated financial statements. Revenue Recognition. In May 2014, the FASB issued an amendment to previously issued guidance regarding the recognition of revenue, which supersedes the revenue recognition requirements in Accounting Standards Codification (“ASC”) Topic 605, “Revenue Recognition,” and most industry-specific guidance. The FASB and the International Accounting Standards Board initiated a joint project to clarify the principles for recognizing revenue and to develop a common standard that would (i) remove inconsistencies and weaknesses in revenue requirements, (ii) provide a more robust framework for addressing revenue issues, (iii) improve comparability of revenue recognition practices across entities, industries, jurisdictions and capital markets, (iv) provide more useful information to users of financial statements through improved disclosure requirements and (v) simplify the preparation of financial statements by reducing the number of requirements to which an entity must refer. The core principle of the guidance 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. To achieve this core principle, an entity should apply the following steps: (1) identify the contract(s) with the customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to the performance obligations in the contract; and (5) recognize revenue when (or as) the entity satisfies a performance obligation. This guidance supersedes prior revenue recognition requirements and most industry-specific guidance throughout the FASB Accounting Standards Codification. This guidance is effective for annual reporting periods beginning after December 15, 2016, including interim periods within that reporting period. In April 2015, the FASB proposed to delay the effective date one year, beginning in fiscal year 2018 and such proposal was subsequently adopted by the FASB in August 2015. The Company is evaluating the new guidance and has not yet determined the impact this new standard may have on its consolidated financial statements or decided upon its method of adoption. |
Summary of Significant Accoun19
Summary of Significant Accounting Policies (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Accounting Policies [Abstract] | |
Summary of the activity related to the allowance for doubtful accounts | A summary of the activity related to the allowance for doubtful accounts is as follows: September 30, 2016 December 31, 2015 (in thousands) Allowance for doubtful accounts, beginning of period $ — $ — Expense — — Reductions/write-offs 1,953 — Allowance for doubtful accounts, end of period $ 1,953 $ — |
Property, Plant And Equipment (
Property, Plant And Equipment (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Business Acquisition [Line Items] | |
Schedule of Capitalized Costs of Unproved Properties Excluded from Amortization | The following table summarizes the components of unproved properties excluded from amortization at the dates indicated: September 30, 2016 December 31, 2015 (in thousands) Unproved properties, excluded from amortization: Drilling in progress costs $ 10,346 $ 1,533 Acreage acquisition costs 92,299 82,560 Capitalized interest 6,622 8,516 Total unproved properties excluded from amortization $ 109,267 $ 92,609 |
Schedule Of Relevant Assumptions Used In Ceiling Test Computations | The table below sets forth relevant pricing assumptions utilized in the quarterly ceiling test computations for the respective periods noted before adjustment for basis and quality differentials: 2016 Total Year to Date Impairment September 30 June 30 March 31 Henry Hub natural gas price (per MMBtu) (1) $ 2.28 $ 2.24 $ 2.40 West Texas Intermediate oil price (per Bbl) (1) $ 41.68 $ 43.12 $ 46.26 Impairment recorded (pre-tax) (in thousands) $ 48,497 $ — $ — $ 48,497 2015 Total Year to Date Impairment September 30 June 30 March 31 Henry Hub natural gas price (per MMBtu) (1) $ 3.06 $ 3.39 $ 3.88 West Texas Intermediate oil price (per Bbl) (1) $ 59.21 $ 71.68 $ 82.72 Impairment recorded (pre-tax) (in thousands) $ 282,118 $ 181,966 $ 100,152 $ — (1) For the respective periods, oil and natural gas prices are calculated using the trailing 12-month unweighted arithmetic average of the first-day-of-the-month prices based on Henry Hub spot natural gas prices and West Texas Intermediate spot oil prices. |
Husky Acquisition | |
Business Acquisition [Line Items] | |
Business Acquisition, Pro Forma Information | The following unaudited pro forma results for the three and nine months ended September 30, 2015 show the effect on the Company’s consolidated results of operations as if the Husky Acquisition had occurred at the beginning of the period presented. The pro forma results are the result of combining the statement of operations of the Company with the statements of revenues and direct operating expenses for the properties acquired from Husky adjusted for (1) assumption of ARO liabilities and accretion expense for the properties acquired and (2) additional depreciation, depletion and amortization expense as a result of the Company’s increased ownership in the acquired properties. The statements of revenues and direct operating expenses for the Husky Acquisition assets exclude all other historical expenses of Husky. As a result, certain estimates and judgments were made in preparing the pro forma adjustments. For the Three Months Ended September 30, 2015 For the Nine Months Ended September 30, 2015 (in thousands, except (Unaudited) Revenues $ 30,087 $ 91,493 Net Loss $ (191,256 ) $ (309,921 ) Loss per share: Basic $ (2.46 ) $ (4.00 ) Diluted $ (2.46 ) $ (4.00 ) |
Appalachian Basin | |
Business Acquisition [Line Items] | |
Business Acquisition, Pro Forma Information | The following unaudited pro forma results for the three months ended September 30, 2015 and the nine months ended September 30, 2016 and 2015 show the effect on the Company's consolidated results of operations as if the Appalachian Basin Sale had occurred at the beginning of the periods presented. The pro forma results are the result of excluding from the statement of operations of the Company the revenues and direct operating expenses for the properties divested adjusted for (1) the reduction in ARO liabilities and accretion expense for the properties divested, (2) the reduction in depreciation, depletion and amortization expense as a result of the divestiture and (3) the reduction in interest expense as a result of the pay down of debt under the Revolving Credit Facility in conjunction with the closing of the Appalachian Basin Sale. As a result, certain estimates and judgments were made in preparing the pro forma adjustments. For the Three Months Ended September 30, 2015 (in thousands, except (Unaudited) Revenues $ 26,847 Net Loss $ (188,685 ) Loss per share: Basic $ (2.43 ) Diluted $ (2.43 ) For the Nine Months Ended September 30, 2016 2015 (in thousands, except (Unaudited) Revenues $ 36,892 $ 73,515 Net Loss $ (90,336 ) $ (310,148 ) Loss per share: Basic $ (0.87 ) $ (4.00 ) Diluted $ (0.87 ) $ (4.00 ) |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Debt Disclosure [Abstract] | |
Summary of Notes Balance | A summary of the Notes balance for the periods indicated is as follows: September 30, 2016 December 31, 2015 (in thousands) Notes, principal balance $ 325,000 $ 325,000 Less: Unamortized discounts (5,070 ) (7,151 ) Deferred financing costs (940 ) (1,373 ) Notes, net $ 318,990 $ 316,476 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements, Recurring and Nonrecurring | The following tables set forth by level within the fair value hierarchy the Company’s financial assets and liabilities that were accounted for at fair value on a recurring basis as of September 30, 2016 and December 31, 2015: Fair value as of September 30, 2016 Level 1 Level 2 Level 3 Total (in thousands) Assets: Cash and cash equivalents $ 46,739 $ — $ — $ 46,739 Commodity derivative contracts — — 9,155 9,155 Liabilities: Commodity derivative contracts — — (102 ) (102 ) Total $ 46,739 $ — $ 9,053 $ 55,792 Fair value as of December 31, 2015 Level 1 Level 2 Level 3 Total (in thousands) Assets: Cash and cash equivalents $ 50,074 $ — $ — $ 50,074 Commodity derivative contracts — — 24,869 24,869 Liabilities: Commodity derivative contracts — — (451 ) (451 ) Total $ 50,074 $ — $ 24,418 $ 74,492 |
Fair Value Assets and Liabilities Measured on Recurring Basis Unobservable Input Reconciliation | The table below presents a reconciliation of the assets and liabilities classified as Level 3 in the fair value hierarchy for the three and nine months ended September 30, 2016 and 2015. Level 3 instruments presented in the table consist of net derivatives that, in management’s opinion, reflect the assumptions a marketplace participant would have used at September 30, 2016 and 2015. Three Months Ended September 30, Nine Months Ended September 30, 2016 2015 2016 2015 (in thousands) Balance at beginning of period $ 12,782 $ 22,373 $ 24,418 $ 27,502 Total (losses) gains included in earnings (1,498 ) 11,301 (3,991 ) 19,734 Purchases — 415 565 1,326 Issuances — — (165 ) (1,313 ) Settlements (1) (2,231 ) (6,793 ) (11,774 ) (19,953 ) Balance at end of period $ 9,053 $ 27,296 $ 9,053 $ 27,296 The amount of total (losses) gains for the period included in earnings attributable to the change in mark to market of commodity derivatives contracts still held at September 30, 2016 and 2015 $ (3,134 ) $ 4,511 $ (12,974 ) $ 986 (1) Included in gain (loss) on commodity derivatives contracts on the condensed consolidated statements of operations. |
Derivative Instruments and He23
Derivative Instruments and Hedging Activity (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Derivative [Line Items] | |
Summary of Information Regarding Deferred Put Premium Liabilities | The following table provides information regarding the deferred put premium liabilities for the periods indicated: September 30, 2016 December 31, 2015 (in thousands) Current commodity derivative put premium payable $ 1,750 $ 3,194 Long-term commodity derivative put premium payable 1,427 2,788 Total unamortized put premium liabilities $ 3,177 $ 5,982 For the Three Months Ended September 30, 2016 For the Nine Months Ended September 30, 2016 (in thousands) Put premium liabilities, beginning balance $ 3,546 $ 5,982 Settlement of put premium liabilities (369 ) (2,640 ) Additional put premium liabilities — (165 ) Put premium liabilities, ending balance $ 3,177 $ 3,177 |
Summary of Amortization of Deferred Put Premium Liabilities | The following table provides information regarding the amortization of the deferred put premium liabilities by year as of September 30, 2016: Amortization (in thousands) October to December 2016 $ 554 January to December 2017 1,654 January to August 2018 969 Total unamortized put premium liabilities $ 3,177 |
Summary of Information on the Location and Amounts of Derivative Fair Values and Derivative Gains and Losses | The tables below provide information on the location and amounts of derivative fair values in the condensed consolidated statement of financial position and derivative gains and losses in the condensed consolidated statement of operations for derivative instruments that are not designated as hedging instruments: Fair Values of Derivative Instruments Derivative Assets (Liabilities) Fair Value Balance Sheet Location September 30, 2016 December 31, 2015 (in thousands) Derivatives not designated as hedging instruments Commodity derivative contracts Current assets $ 5,240 $ 15,534 Commodity derivative contracts Other assets 3,915 9,335 Commodity derivative contracts Current liabilities (102 ) — Commodity derivative contracts Long-term liabilities — (451 ) Total derivatives not designated as hedging instruments $ 9,053 $ 24,418 Amount of Gain (Loss) Recognized in Income on Derivatives For the Three Months Ended September 30, Location of Gain (Loss) Recognized in Income on Derivatives 2016 2015 (in thousands) Derivatives not designated as hedging instruments Commodity derivative contracts (Loss) gain on commodity derivatives contracts $ (1,498 ) $ 11,301 Total $ (1,498 ) $ 11,301 Amount of Gain (Loss) Recognized in Income on Derivatives For the Nine Months Ended September 30, Location of (Gain) Loss Recognized in Income on Derivatives 2016 2015 (in thousands) Derivatives not designated as hedging instruments Commodity derivative contracts (Loss) gain on commodity derivatives contracts $ (3,991 ) $ 19,734 Total $ (3,991 ) $ 19,734 |
Natural Gas | |
Derivative [Line Items] | |
Schedule of Notional Amounts and Weighted Average Underlying Hedge Prices of Outstanding Derivative Positions | As of September 30, 2016, the following natural gas derivative transactions were outstanding with the associated notional volumes and weighted average underlying hedge prices: Settlement Period Derivative Instrument Average Daily Volume Total of Notional Volume Floor (Long) Short Put Ceiling (Short) (in MMBtus) 2016 (1) Costless three-way collar 2,500 77,500 $ 3.00 $ 2.25 $ 3.65 2016 Costless three-way collar 2,000 184,000 $ 4.00 $ 3.25 $ 4.58 2016 Costless three-way collar 5,000 460,000 $ 3.40 $ 2.65 $ 4.10 2017 Costless three-way collar 5,000 1,825,000 $ 3.00 $ 2.35 $ 4.00 2017 (2) Costless collar 2,000 180,000 $ 3.10 $ — $ 3.78 2018 Costless three-way collar 5,000 1,825,000 $ 3.00 $ 2.35 $ 4.00 (1) For the month of October 2016. (2) For the period January to March 2017. |
Natural Gas Liquids | |
Derivative [Line Items] | |
Schedule of Notional Amounts and Weighted Average Underlying Hedge Prices of Outstanding Derivative Positions | As of September 30, 2016, the following NGLs derivative transactions were outstanding with the associated notional volumes and weighted average underlying hedge prices: Settlement Period Derivative Instrument Average Daily Volume Total of Notional Volume Base Fixed Price (in Bbls) 2016 Fixed price swap 500 61,000 $ 20.79 |
Crude Oil | |
Derivative [Line Items] | |
Schedule of Notional Amounts and Weighted Average Underlying Hedge Prices of Outstanding Derivative Positions | As of September 30, 2016, the following crude derivative transactions were outstanding with the associated notional volumes and weighted average underlying hedge prices: Settlement Period Derivative Instrument Average Daily Volume (1) Total of Notional Volume Base Fixed Price Floor (Long) Short Put Ceiling (Short) (in Bbls) 2016 Costless three-way collar 250 30,500 $ — $ 85.00 $ 65.00 $ 95.10 2016 Costless three-way collar 330 40,260 $ — $ 80.00 $ 65.00 $ 97.35 2016 Costless three-way collar 450 54,900 $ — $ 57.50 $ 42.50 $ 80.00 2016 Put spread 550 67,100 $ — $ 85.00 $ 65.00 $ — 2016 Fixed price swap 300 36,600 $ 56.30 $ — $ — $ — 2016 Fixed price swap 200 24,400 $ 50.00 $ — $ — $ — 2017 Costless three-way collar 280 102,200 $ — $ 80.00 $ 65.00 $ 97.25 2017 Costless three-way collar 250 91,250 $ — $ 80.00 $ 60.00 $ 98.70 2017 (2) Protective spread 200 36,200 $ 60.00 $ — $ 42.50 $ — 2017 Put spread 500 182,500 $ — $ 82.00 $ 62.00 $ — 2017 (2) Protective spread 200 36,200 $ 57.50 $ — $ 42.50 $ — 2017 (2) Fixed price swap 300 54,300 $ 50.10 $ — $ — $ — 2017 (3) Costless three-way collar 200 36,800 $ — $ 60.00 $ 42.50 $ 85.00 2017 (3) Costless three-way collar 200 36,800 $ — $ 57.50 $ 42.50 $ 76.13 2017 (4) Fixed price swap 200 18,000 $ 50.05 $ — $ — $ — 2018 (5) Put spread 425 103,275 $ — $ 80.00 $ 60.00 $ — (1) Crude volumes hedged include oil, condensate and certain components of our NGLs production. (2) For the period January to June 2017. (3) For the period July to December 2017. (4) For the period January to March 2017. (5) For the period January to August 2018. |
Capital Stock (Tables)
Capital Stock (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Stockholders Equity Note [Abstract] | |
Schedule of Issuances And Forfeitures Of Common Shares | The following table provides information regarding the issuances and forfeitures of common stock pursuant to the Company's long-term incentive plan for the periods indicated: For the Three Months Ended September 30, 2016 For the Nine Months Ended September 30, 2016 Other share issuances: Shares of restricted common stock granted — 1,714,645 Shares of restricted common stock vested 33,075 1,472,915 Shares of common stock issued pursuant to PBUs vested, net of forfeitures — 502,593 Shares of restricted common stock surrendered upon vesting/exercise (1) 3,664 389,905 Shares of restricted common stock forfeited — 126,336 (1) Represents shares of common stock forfeited in connection with the payment of estimated withholding taxes on shares of restricted common stock that vested during the period. |
Interest Expense (Tables)
Interest Expense (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Interest Expense [Abstract] | |
Schedule Of Components Of Interest Expense | The following table summarizes the components of interest expense for the periods indicated: For the Three Months Ended September 30, For the Nine Months Ended September 30, 2016 2015 2016 2015 (in thousands) Interest expense: Cash and accrued $ 8,158 $ 7,703 $ 25,275 $ 22,872 Amortization of deferred financing costs (1) 986 916 3,812 2,652 Capitalized interest (966 ) (686 ) (2,348 ) (3,094 ) Total interest expense $ 8,178 $ 7,933 $ 26,739 $ 22,430 (1) The three months ended September 30, 2016 and 2015 includes $711,000 and $644,000, respectively, of debt discount accretion related to the Notes. The nine months ended September 30, 2016 and 2015 includes $2.1 million and $1.9 million, respectively, of debt discount accretion related to the Notes. |
Earnings per Share (Tables)
Earnings per Share (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted | For the Three Months Ended September 30, For the Nine Months Ended September 30, 2016 2015 2016 2015 (in thousands, except per share and share data) Net loss attributable to common stockholders $ (3,796 ) $ (191,819 ) $ (95,371 ) $ (312,837 ) Weighted average common shares outstanding - basic 129,301,817 77,628,120 104,125,317 77,453,251 Incremental shares from unvested restricted shares — — — — Incremental shares from outstanding stock options — — — — Incremental shares from outstanding PBUs — — — — Weighted average common shares outstanding - diluted 129,301,817 77,628,120 104,125,317 77,453,251 Net loss per share of common stock attributable to common stockholders: Basic $ (0.03 ) $ (2.47 ) $ (0.92 ) $ (4.04 ) Diluted $ (0.03 ) $ (2.47 ) $ (0.92 ) $ (4.04 ) Common shares excluded from denominator as anti-dilutive: Unvested restricted shares 170,362 239,161 540,994 146,253 Unvested PBUs 1,041,493 503,271 837,199 84,179 Total 1,211,855 742,432 1,378,193 230,432 |
Statement of Cash Flows - Sup27
Statement of Cash Flows - Supplemental Information (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Supplemental Cash Flow Information [Abstract] | |
Statement of Cash Flows Supplemental Information | The following is a summary of the supplemental cash paid and non-cash transactions for the periods indicated: For the Nine Months Ended September 30, 2016 2015 (in thousands) Cash paid for interest, net of capitalized amounts $ 16,140 $ 12,699 Non-cash transactions: Capital expenditures included in (excluded from) accounts payable and accrued drilling costs $ 4,913 $ (12,396 ) Capital expenditures included in accounts receivable $ 409 $ — Asset retirement obligation included in oil and natural gas properties $ 128 $ 276 Asset retirement obligation sold $ (694 ) $ — Preferred dividends accrued but not declared $ 7,237 $ — Application of advances to operators $ (378 ) $ 11,113 Expenses accrued for the issuance of common stock $ 2 $ — |
Description of Business (Narrat
Description of Business (Narrative) (Details) - USD ($) $ in Thousands | Apr. 08, 2016 | Feb. 19, 2016 | Sep. 30, 2016 | Sep. 30, 2015 |
Exploratory Wells Drilled [Line Items] | ||||
Proceeds from sale of oil and natural gas properties | $ 77,499 | $ 47,866 | ||
Appalachian Basin | ||||
Exploratory Wells Drilled [Line Items] | ||||
Proceeds from sale of oil and natural gas properties | $ 75,700 | $ 80,000 | ||
Suspense liability transferred to buyer | $ 3,500 |
Summary of Significant Accoun29
Summary of Significant Accounting Policies (Narrative) (Details) | Oct. 19, 2016USD ($)awell | Oct. 14, 2016USD ($)awellTownshipTranche | Jul. 01, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 |
Subsequent Event | Oklahoma | Red Bluff | Canadian County Property | ||||||
Accounting Policies [Line Items] | ||||||
Net acres to be sold | a | 25,300 | |||||
Net acres allocated | a | 19,100 | |||||
Gross wells to be sold | 25 | |||||
Net wells to be sold | 11.2 | |||||
Consideration on sale of property | $ | $ 71,000,000 | |||||
Contingent consideration on sale of property | $ | $ 10,000,000 | |||||
Subsequent Event | Oklahoma | Development Agreement | ||||||
Accounting Policies [Line Items] | ||||||
Investor funding percentage on working interest portion of drilling and completion cost | 90.00% | |||||
Investors percentage of Gastar's working interest in each new well | 80.00% | |||||
Percentage of costs to pay to obtain 20% working interest | 10.00% | |||||
Percentage on working interest in each new well | 20.00% | |||||
Number of tranches | Tranche | 3 | |||||
Number of wells in each tranche | 20 | |||||
Number of wells in Meramec formation | 18 | |||||
Number of wells in Osage formation | 2 | |||||
Percentage of internal rate of return one | 15.00% | |||||
Percentage of working interest on achievement of 15% internal rate of return | 60.00% | |||||
Percentage of internal rate of return two | 20.00% | |||||
Percentage of working interest on achievement of 20% internal rate of return | 90.00% | |||||
Description of working interest on achievement of internal rate of returns | With respect to each 20 well tranche, when the Investor has achieved an aggregate 15% IRR for its investment in the tranche, its interest will be reduced from 80% to 40% of Gastar’s original working interest and Gastar’s working interest increases from 20% to 60% of Gastar’s original working interest. When a tranche IRR of 20% is achieved by the Investor, its working interest decreases to 10% and Gastar’s working interest increases to 90% of the working interest originally owned by Gastar. | |||||
Subsequent Event | Oklahoma | Development Agreement | STACK Exploration LLC | ||||||
Accounting Policies [Line Items] | ||||||
Number of townships covered | Township | 3 | |||||
Net acres | a | 18,000 | |||||
Percentage of working interest on achievement of 15% internal rate of return | 40.00% | |||||
Percentage of working interest on achievement of 20% internal rate of return | 10.00% | |||||
Subsequent Event | Oklahoma | Maximum | Development Agreement | STACK Exploration LLC | ||||||
Accounting Policies [Line Items] | ||||||
Number of operated wells | 60 | |||||
Revolving Credit Facility | Amendment No. 9 | Scenario Forecast | Minimum | ||||||
Accounting Policies [Line Items] | ||||||
Interest coverage ratio | 250.00% | 100.00% | 80.00% | 80.00% | ||
Revolving Credit Facility | Amendment No. 9 | Subsequent Event | ||||||
Accounting Policies [Line Items] | ||||||
Revolving credit facility borrowing base | $ | $ 100,000,000 | |||||
Revolving Credit Facility | Amendment No. 9 | Subsequent Event | Oklahoma | ||||||
Accounting Policies [Line Items] | ||||||
Percentage of loan balance to be pre-paid based on future net sales | 20.00% |
Summary of Significant Accoun30
Summary of Significant Accounting Policies (Schedule of Allowance for Doubtful Accounts) (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2016 | Dec. 31, 2015 | |
Allowance for Doubtful Accounts Receivable [Roll Forward] | ||
Allowance for doubtful accounts, beginning of period | $ 0 | $ 0 |
Expense | 0 | 0 |
Reductions/write-offs | 1,953 | 0 |
Allowance for doubtful accounts, end of period | $ 1,953 | $ 0 |
Property, Plant and Equipment31
Property, Plant and Equipment (Schedule of Capitalized Costs of Unproved Properties Excluded from Amortization) (Details) - USD ($) $ in Thousands | Sep. 30, 2016 | Dec. 31, 2015 |
Unproved properties, excluded from amortization: | ||
Drilling in progress costs | $ 10,346 | $ 1,533 |
Acreage acquisition costs | 92,299 | 82,560 |
Capitalized interest | 6,622 | 8,516 |
Total unproved properties excluded from amortization | $ 109,267 | $ 92,609 |
Property, Plant and Equipment32
Property, Plant and Equipment (Narrative) (Details) | Oct. 19, 2016USD ($)awell | Oct. 14, 2016awellTownshipTranche | Apr. 08, 2016USD ($) | Feb. 19, 2016USD ($) | Dec. 16, 2015USD ($)awell | Sep. 30, 2016USD ($) | Sep. 30, 2015USD ($) |
Property, Plant and Equipment [Line Items] | |||||||
Discount rate for estimated future cash flows | 10.00% | ||||||
Proceeds from sale of natural gas and oil properties | $ 77,499,000 | $ 47,866,000 | |||||
Percentage difference of fair value to purchase price | 6.00% | ||||||
Assets, fair value adjustment | $ 0 | ||||||
Husky Acquisition | |||||||
Property, Plant and Equipment [Line Items] | |||||||
Net acres | a | 11,000 | ||||||
Gross wells | well | 103 | ||||||
Net wells | well | 10.2 | ||||||
Acquisition of oil and natural gas properties | $ 42,700,000 | ||||||
Revenue suspense liability assumed | 358,000 | ||||||
Escrow for pending resolution of title defects and purchase of overrides recorded in other assets | 715,000 | ||||||
Fair market valuation amount | 44,600,000 | ||||||
Husky Acquisition | General and Administrative Expense | |||||||
Property, Plant and Equipment [Line Items] | |||||||
Transaction and integration costs | $ 1,500,000 | ||||||
Appalachian Basin | |||||||
Property, Plant and Equipment [Line Items] | |||||||
Proceeds from sale of natural gas and oil properties | $ 75,700,000 | $ 80,000,000 | |||||
Suspense liability transferred to buyer | $ 3,500,000 | ||||||
Gain or loss of assets | $ 0 | ||||||
Subsequent Event | Oklahoma | Red Bluff | Canadian County Property | |||||||
Property, Plant and Equipment [Line Items] | |||||||
Net acres to be sold | a | 25,300 | ||||||
Net acres allocated | a | 19,100 | ||||||
Gross wells to be sold | well | 25 | ||||||
Net wells to be sold | well | 11.2 | ||||||
Consideration on sale of property | $ 71,000,000 | ||||||
Contingent consideration on sale of property | $ 10,000,000 | ||||||
Subsequent Event | Development Agreement | Oklahoma | |||||||
Property, Plant and Equipment [Line Items] | |||||||
Investor funding percentage on working interest portion of drilling and completion cost | 90.00% | ||||||
Investors percentage of Gastar's working interest in each new well | 80.00% | ||||||
Percentage of costs to pay to obtain 20% working interest | 10.00% | ||||||
Percentage on working interest in each new well | 20.00% | ||||||
Number of tranches | Tranche | 3 | ||||||
Number of wells in each tranche | well | 20 | ||||||
Number of wells in Meramec formation | well | 18 | ||||||
Number of wells in Osage formation | well | 2 | ||||||
Percentage of internal rate of return one | 15.00% | ||||||
Percentage of working interest on achievement of 15% internal rate of return | 60.00% | ||||||
Percentage of internal rate of return two | 20.00% | ||||||
Percentage of working interest on achievement of 20% internal rate of return | 90.00% | ||||||
Description of working interest on achievement of internal rate of returns | With respect to each 20 well tranche, when the Investor has achieved an aggregate 15% IRR for its investment in the tranche, its interest will be reduced from 80% to 40% of Gastar’s original working interest and Gastar’s working interest increases from 20% to 60% of Gastar’s original working interest. When a tranche IRR of 20% is achieved by the Investor, its working interest decreases to 10% and Gastar’s working interest increases to 90% of the working interest originally owned by Gastar. | ||||||
Subsequent Event | Development Agreement | Oklahoma | Investor | |||||||
Property, Plant and Equipment [Line Items] | |||||||
Number of townships covered | Township | 3 | ||||||
Net acres | a | 18,000 | ||||||
Percentage of working interest on achievement of 15% internal rate of return | 40.00% | ||||||
Percentage of working interest on achievement of 20% internal rate of return | 10.00% | ||||||
Subsequent Event | Development Agreement | Oklahoma | Investor | Maximum | |||||||
Property, Plant and Equipment [Line Items] | |||||||
Number of operated wells | well | 60 |
Property, Plant and Equipment33
Property, Plant and Equipment (Average Sales Price and Production Costs Per Unit of Production) (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | |||||||
Sep. 30, 2016USD ($)$ / MMBTU$ / bbl | Jun. 30, 2016USD ($)$ / MMBTU$ / bbl | Mar. 31, 2016USD ($)$ / MMBTU$ / bbl | Sep. 30, 2015USD ($)$ / MMBTU$ / bbl | Jun. 30, 2015USD ($)$ / MMBTU$ / bbl | Mar. 31, 2015USD ($)$ / MMBTU$ / bbl | Sep. 30, 2016USD ($) | Sep. 30, 2015USD ($) | ||
Average Sales Price and Production Costs Per Unit of Production [Line Items] | |||||||||
Impairment recorded (pre-tax) (in thousands) | $ | $ 0 | $ 0 | $ 48,497 | $ 181,966 | $ 100,152 | $ 0 | $ 48,497 | $ 282,118 | |
Natural Gas Per Thousand Cubic Feet | |||||||||
Average Sales Price and Production Costs Per Unit of Production [Line Items] | |||||||||
Average price per Mcfe | $ / MMBTU | [1] | 2.28 | 2.24 | 2.40 | 3.06 | 3.39 | 3.88 | ||
Crude Oil And N G L Per Barrel | |||||||||
Average Sales Price and Production Costs Per Unit of Production [Line Items] | |||||||||
Average price per Mcfe | $ / bbl | [1] | 41.68 | 43.12 | 46.26 | 59.21 | 71.68 | 82.72 | ||
[1] | For the respective periods, oil and natural gas prices are calculated using the trailing 12-month unweighted arithmetic average of the first-day-of-the-month prices based on Henry Hub spot natural gas prices and West Texas Intermediate spot oil prices. |
Property, Plant And Equipment34
Property, Plant And Equipment (Schedule of Pro Forma Information) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | |
Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Husky Acquisition | |||
Business Acquisition [Line Items] | |||
Revenues | $ 30,087 | $ 91,493 | |
Net Loss | $ (191,256) | $ (309,921) | |
Loss per share, Basic | $ (2.46) | $ (4) | |
Loss per share, Diluted | $ (2.46) | $ (4) | |
Appalachian Basin | |||
Business Acquisition [Line Items] | |||
Revenues | $ 26,847 | $ 36,892 | $ 73,515 |
Net Loss | $ (188,685) | $ (90,336) | $ (310,148) |
Loss per share, Basic | $ (2.43) | $ (0.87) | $ (4) |
Loss per share, Diluted | $ (2.43) | $ (0.87) | $ (4) |
Long-Term Debt (Narrative) (Det
Long-Term Debt (Narrative) (Details) | Mar. 09, 2016USD ($) | Jun. 07, 2013 | May 15, 2013USD ($) | Sep. 30, 2016USD ($) | Jul. 01, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Nov. 01, 2016USD ($) | Oct. 14, 2016USD ($) | Jun. 30, 2016 | Apr. 10, 2016USD ($) | Apr. 08, 2016USD ($) | Dec. 31, 2015USD ($) | Nov. 15, 2013 |
Line of Credit Facility [Line Items] | |||||||||||||||
Waiver expiration date | Mar. 10, 2016 | ||||||||||||||
Aggregate principal amount | $ 325,000,000 | $ 325,000,000 | |||||||||||||
Second Amended and Restated Revolving Credit Facility | |||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||
Interest rate description | borrowings bear interest at the reference rate or the Eurodollar rate plus an applicable margin. The reference rate is the greater of (i) the rate of interest publicly announced by the administrative agent, (ii) the federal funds rate plus 50 basis points and (iii) LIBOR plus 1.0%. | ||||||||||||||
Annual commitment fee (percentage) | 0.50% | ||||||||||||||
Revolving credit facility scheduled maturity date | Nov. 14, 2017 | ||||||||||||||
Percentage of stock foreign subsidiary pledged as collateral for credit facility (percentage) | 65.00% | ||||||||||||||
Revolving credit facility borrowing base | $ 100,000,000 | ||||||||||||||
Borrowings outstanding | 99,600,000 | ||||||||||||||
Letters of credit issued | 370,000 | ||||||||||||||
Increase in current borrowing base | $ 50,000,000 | ||||||||||||||
Increase in adjusted consolidated net tangibles assets | 17.50% | ||||||||||||||
Second Amended and Restated Revolving Credit Facility | Subsequent Event | |||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||
Borrowings outstanding | $ 99,600,000 | ||||||||||||||
Letters of credit issued | $ 370,000 | ||||||||||||||
Second Amended and Restated Revolving Credit Facility | Minimum | |||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||
Line of credit facility covenant compliance Current Ratio | 100.00% | ||||||||||||||
Second Amended and Restated Revolving Credit Facility | Federal Funds Rate | |||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||
Applicable interest margin (percentage) | 0.50% | ||||||||||||||
Second Amended and Restated Revolving Credit Facility | LIBOR | |||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||
Applicable interest margin (percentage) | 1.00% | ||||||||||||||
Second Amended and Restated Revolving Credit Facility | Prime Rate | Minimum | |||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||
Applicable interest margin (percentage) | 1.00% | ||||||||||||||
Second Amended and Restated Revolving Credit Facility | Prime Rate | Maximum | |||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||
Applicable interest margin (percentage) | 2.00% | ||||||||||||||
Second Amended and Restated Revolving Credit Facility | Eurodollar Rate | Minimum | |||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||
Applicable interest margin (percentage) | 2.00% | ||||||||||||||
Second Amended and Restated Revolving Credit Facility | Eurodollar Rate | Maximum | |||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||
Applicable interest margin (percentage) | 3.00% | ||||||||||||||
Amendment No. 8 | |||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||
Line of credit facility covenant compliance EBITDA to Interest Expense Ratio on a four quarter rolling basis | 250.00% | ||||||||||||||
Revolving credit facility borrowing base | $ 180,000,000 | $ 200,000,000 | $ 100,000,000 | $ 100,000,000 | |||||||||||
Leverage ratio | 2.50 | ||||||||||||||
Interest coverage ratio | 110.00% | ||||||||||||||
Threshold for automatic reductions of the borrowing base in connection with asset sales | 5,000,000 | ||||||||||||||
Threshold for lenders consent requirement in connection with asset sales | $ 5,000,000 | ||||||||||||||
Amendment No. 8 | Scenario Forecast | |||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||
Leverage ratio | 2 | ||||||||||||||
Interest coverage ratio | 250.00% | ||||||||||||||
Amendment No. 8 | Maximum | |||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||
Line of credit facility covenant compliance indebtedness to EBITDA Ratio | 400.00% | ||||||||||||||
Amendment No. 8 | Maximum | Scenario Forecast | |||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||
Leverage ratio | 4 | ||||||||||||||
Amendment No. 8 | Eurodollar Rate | |||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||
Applicable interest margin (percentage) | 4.00% | ||||||||||||||
Amendment No. 8 | Reference Rate | |||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||
Applicable interest margin (percentage) | 3.00% | ||||||||||||||
Amendment No. 9 | Revolving Credit Facility | Subsequent Event | |||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||
Revolving credit facility borrowing base | $ 100,000,000 | ||||||||||||||
Amendment No. 9 | Revolving Credit Facility | Subsequent Event | Oklahoma | |||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||
Percentage of loan balance to be pre-paid based on future net sales | 20.00% | ||||||||||||||
Amendment No. 9 | Minimum | Scenario Forecast | Revolving Credit Facility | |||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||
Interest coverage ratio | 250.00% | 100.00% | 80.00% | 80.00% | |||||||||||
Senior Secured Notes Due 2018 | |||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||
Aggregate principal amount | $ 325,000,000 | ||||||||||||||
Debt instrument interest rate description | The Notes bear interest at a rate of 8.625% per year, payable semi-annually in arrears on May 15 and November 15 of each year. | ||||||||||||||
Interest rate | 8.625% | 8.625% | |||||||||||||
Debt instrument maturity date | May 15, 2018 | ||||||||||||||
Debt instrument effective date | May 17, 2016 | ||||||||||||||
Percentage of aggregate principal amount | 101.00% |
Long-Term Debt - Summary of Not
Long-Term Debt - Summary of Notes Balance (Details) - USD ($) | Sep. 30, 2016 | Dec. 31, 2015 |
Debt Disclosure [Abstract] | ||
Notes, principal balance | $ 325,000,000 | $ 325,000,000 |
Unamortized discounts | (5,070,000) | (7,151,000) |
Deferred financing costs | (940,000) | (1,373,000) |
Notes, net | $ 318,990,000 | $ 316,476,000 |
Fair Value Measurements (Narrat
Fair Value Measurements (Narrative) (Details) - USD ($) | 3 Months Ended | |
Sep. 30, 2016 | Sep. 30, 2015 | |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Impairment of unproved properties | $ 0 | $ 0 |
Level 1 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Fair value of long-term debt | $ 366,300,000 |
Fair Value Measurements (Fair V
Fair Value Measurements (Fair Value Measurements, Recurring and Nonrecurring) (Details) - Fair Value, Measurements, Recurring - USD ($) $ in Thousands | Sep. 30, 2016 | Dec. 31, 2015 |
Assets: | ||
Cash and cash equivalents | $ 46,739 | $ 50,074 |
Assets, Commodity derivative contracts | 9,155 | 24,869 |
Liabilities: | ||
Liabilities, Commodity derivative contracts | (102) | (451) |
Total | 55,792 | 74,492 |
Level 1 | ||
Assets: | ||
Cash and cash equivalents | 46,739 | 50,074 |
Liabilities: | ||
Total | 46,739 | 50,074 |
Level 3 | ||
Assets: | ||
Assets, Commodity derivative contracts | 9,155 | 24,869 |
Liabilities: | ||
Liabilities, Commodity derivative contracts | (102) | (451) |
Total | $ 9,053 | $ 24,418 |
Fair Value Measurements (Net Ch
Fair Value Measurements (Net Change in Assets and Liabilities Measured at Fair Value on a Recurring Basis and Included in the Level 3 Fair Value Category) (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||||
The amount of total (losses) gains for the period included in earnings attributable to the change in mark to market of commodity derivatives contracts still held at September 30, 2016 and 2015 | $ (3,100,000) | $ 4,500,000 | $ (13,000,000) | $ 986,000 | |
Fair Value, Measurements, Recurring | |||||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||||
Balance at beginning of period | 12,782,000 | 22,373,000 | 24,418,000 | 27,502,000 | |
Total (losses) gains included in earnings | (1,498,000) | 11,301,000 | (3,991,000) | 19,734,000 | |
Purchases | 0 | 415,000 | 565,000 | 1,326,000 | |
Issuances | 0 | 0 | (165,000) | (1,313,000) | |
Settlements | [1] | (2,231,000) | (6,793,000) | (11,774,000) | (19,953,000) |
Balance at end of period | 9,053,000 | 27,296,000 | 9,053,000 | 27,296,000 | |
The amount of total (losses) gains for the period included in earnings attributable to the change in mark to market of commodity derivatives contracts still held at September 30, 2016 and 2015 | $ (3,134,000) | $ 4,511,000 | $ (12,974,000) | $ 986,000 | |
[1] | Included in gain (loss) on commodity derivatives contracts on the condensed consolidated statements of operations. |
Derivative Instruments and He40
Derivative Instruments and Hedging Activity (Narrative) (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Derivative Instruments And Hedging Activities Disclosure [Abstract] | ||||
Change in fair value of commodity derivative contracts | $ (3,100,000) | $ 4,500,000 | $ (13,000,000) | $ 986,000 |
Derivative Instruments and He41
Derivative Instruments and Hedging Activity (Schedule of Notional Amounts and Weighted Average Underlying Hedge Prices of Outstanding Derivative Positions) (Details) | 9 Months Ended | |
Sep. 30, 2016MMBTU$ / MMBTU$ / bblbbl | ||
Natural Gas | ||
Derivative [Line Items] | ||
Average Daily Volume (MMBtus or Bbls) | MMBTU | 5,000 | |
Total of Notional Volume (MMBtus) | MMBTU | 1,825,000 | |
Long | Natural Gas | ||
Derivative [Line Items] | ||
Floor (Long) (Price per MMBtu or Bbl) | $ / MMBTU | 3 | |
Short | Natural Gas | ||
Derivative [Line Items] | ||
Put (Short) (Price per MMBtu or Bbl) | $ / MMBTU | 2.35 | |
Ceiling (Short) (Price per MMBtu or Bbl) | $ / MMBTU | 4 | |
Costless Three-way Collar 1 - 2016 | Natural Gas | ||
Derivative [Line Items] | ||
Average Daily Volume (MMBtus or Bbls) | MMBTU | 2,500 | [1] |
Total of Notional Volume (MMBtus) | MMBTU | 77,500 | [1] |
Costless Three-way Collar 1 - 2016 | Long | Natural Gas | ||
Derivative [Line Items] | ||
Floor (Long) (Price per MMBtu or Bbl) | $ / MMBTU | 3 | [1] |
Costless Three-way Collar 1 - 2016 | Short | Natural Gas | ||
Derivative [Line Items] | ||
Put (Short) (Price per MMBtu or Bbl) | $ / MMBTU | 2.25 | [1] |
Ceiling (Short) (Price per MMBtu or Bbl) | $ / MMBTU | 3.65 | [1] |
Costless Three-way Collar 2 - 2016 | Natural Gas | ||
Derivative [Line Items] | ||
Average Daily Volume (MMBtus or Bbls) | MMBTU | 2,000 | |
Total of Notional Volume (MMBtus) | MMBTU | 184,000 | |
Costless Three-way Collar 2 - 2016 | Long | Natural Gas | ||
Derivative [Line Items] | ||
Floor (Long) (Price per MMBtu or Bbl) | $ / MMBTU | 4 | |
Costless Three-way Collar 2 - 2016 | Short | Natural Gas | ||
Derivative [Line Items] | ||
Put (Short) (Price per MMBtu or Bbl) | $ / MMBTU | 3.25 | |
Ceiling (Short) (Price per MMBtu or Bbl) | $ / MMBTU | 4.58 | |
Costless Three-way Collar 3 - 2016 | Natural Gas | ||
Derivative [Line Items] | ||
Average Daily Volume (MMBtus or Bbls) | MMBTU | 5,000 | |
Total of Notional Volume (MMBtus) | MMBTU | 460,000 | |
Costless Three-way Collar 3 - 2016 | Long | Natural Gas | ||
Derivative [Line Items] | ||
Floor (Long) (Price per MMBtu or Bbl) | $ / MMBTU | 3.40 | |
Costless Three-way Collar 3 - 2016 | Short | Natural Gas | ||
Derivative [Line Items] | ||
Put (Short) (Price per MMBtu or Bbl) | $ / MMBTU | 2.65 | |
Ceiling (Short) (Price per MMBtu or Bbl) | $ / MMBTU | 4.10 | |
Costless Three-way Collar 1 - 2017 | Natural Gas | ||
Derivative [Line Items] | ||
Average Daily Volume (MMBtus or Bbls) | MMBTU | 5,000 | |
Total of Notional Volume (MMBtus) | MMBTU | 1,825,000 | |
Costless Three-way Collar 1 - 2017 | Long | Natural Gas | ||
Derivative [Line Items] | ||
Floor (Long) (Price per MMBtu or Bbl) | $ / MMBTU | 3 | |
Costless Three-way Collar 1 - 2017 | Short | Natural Gas | ||
Derivative [Line Items] | ||
Put (Short) (Price per MMBtu or Bbl) | $ / MMBTU | 2.35 | |
Ceiling (Short) (Price per MMBtu or Bbl) | $ / MMBTU | 4 | |
Costless Collar 1 - 2017 | Natural Gas | ||
Derivative [Line Items] | ||
Average Daily Volume (MMBtus or Bbls) | MMBTU | 2,000 | [2] |
Total of Notional Volume (MMBtus) | MMBTU | 180,000 | [2] |
Costless Collar 1 - 2017 | Long | Natural Gas | ||
Derivative [Line Items] | ||
Floor (Long) (Price per MMBtu or Bbl) | $ / MMBTU | 3.10 | [2] |
Costless Collar 1 - 2017 | Short | Natural Gas | ||
Derivative [Line Items] | ||
Ceiling (Short) (Price per MMBtu or Bbl) | $ / MMBTU | 3.78 | [2] |
Fixed Price Swap - Natural Gas Liquids 2016 | ||
Derivative [Line Items] | ||
Average Daily Volume (MMBtus or Bbls) | bbl | 500 | |
Total of Notional Volume (Bbls) | bbl | 61,000 | |
Base Fixed Price (Price per MMBtu or Bbl) | 20.79 | |
Crude Oil | Costless Three-way Collar 1 - 2016 | ||
Derivative [Line Items] | ||
Average Daily Volume (MMBtus or Bbls) | bbl | 250 | [3] |
Total of Notional Volume (Bbls) | bbl | 30,500 | |
Crude Oil | Costless Three-way Collar 1 - 2016 | Long | ||
Derivative [Line Items] | ||
Floor (Long) (Price per MMBtu or Bbl) | 85 | |
Crude Oil | Costless Three-way Collar 1 - 2016 | Short | ||
Derivative [Line Items] | ||
Put (Short) (Price per MMBtu or Bbl) | 65 | |
Ceiling (Short) (Price per MMBtu or Bbl) | 95.10 | |
Crude Oil | Costless Three-way Collar 2 - 2016 | ||
Derivative [Line Items] | ||
Average Daily Volume (MMBtus or Bbls) | bbl | 330 | [3] |
Total of Notional Volume (Bbls) | bbl | 40,260 | |
Crude Oil | Costless Three-way Collar 2 - 2016 | Long | ||
Derivative [Line Items] | ||
Floor (Long) (Price per MMBtu or Bbl) | 80 | |
Crude Oil | Costless Three-way Collar 2 - 2016 | Short | ||
Derivative [Line Items] | ||
Put (Short) (Price per MMBtu or Bbl) | 65 | |
Ceiling (Short) (Price per MMBtu or Bbl) | 97.35 | |
Crude Oil | Costless Three-way Collar 3 - 2016 | ||
Derivative [Line Items] | ||
Average Daily Volume (MMBtus or Bbls) | bbl | 450 | [3] |
Total of Notional Volume (Bbls) | bbl | 54,900 | |
Crude Oil | Costless Three-way Collar 3 - 2016 | Long | ||
Derivative [Line Items] | ||
Floor (Long) (Price per MMBtu or Bbl) | 57.50 | |
Crude Oil | Costless Three-way Collar 3 - 2016 | Short | ||
Derivative [Line Items] | ||
Put (Short) (Price per MMBtu or Bbl) | 42.50 | |
Ceiling (Short) (Price per MMBtu or Bbl) | 80 | |
Crude Oil | Put Spread - 2016 | ||
Derivative [Line Items] | ||
Average Daily Volume (MMBtus or Bbls) | bbl | 550 | [3] |
Total of Notional Volume (Bbls) | bbl | 67,100 | |
Crude Oil | Put Spread - 2016 | Long | ||
Derivative [Line Items] | ||
Floor (Long) (Price per MMBtu or Bbl) | 85 | |
Crude Oil | Put Spread - 2016 | Short | ||
Derivative [Line Items] | ||
Put (Short) (Price per MMBtu or Bbl) | 65 | |
Crude Oil | Fixed Price Swap 1 - 2016 | ||
Derivative [Line Items] | ||
Average Daily Volume (MMBtus or Bbls) | bbl | 300 | [3] |
Total of Notional Volume (Bbls) | bbl | 36,600 | |
Base Fixed Price (Price per MMBtu or Bbl) | 56.30 | |
Crude Oil | Fixed Price Swap 2 - 2016 | ||
Derivative [Line Items] | ||
Average Daily Volume (MMBtus or Bbls) | bbl | 200 | [3] |
Total of Notional Volume (Bbls) | bbl | 24,400 | |
Base Fixed Price (Price per MMBtu or Bbl) | 50 | |
Crude Oil | Costless Three-way Collar 1 - 2017 | ||
Derivative [Line Items] | ||
Average Daily Volume (MMBtus or Bbls) | bbl | 280 | [3] |
Total of Notional Volume (Bbls) | bbl | 102,200 | |
Crude Oil | Costless Three-way Collar 1 - 2017 | Long | ||
Derivative [Line Items] | ||
Floor (Long) (Price per MMBtu or Bbl) | 80 | |
Crude Oil | Costless Three-way Collar 1 - 2017 | Short | ||
Derivative [Line Items] | ||
Put (Short) (Price per MMBtu or Bbl) | 65 | |
Ceiling (Short) (Price per MMBtu or Bbl) | 97.25 | |
Crude Oil | Costless Three-way Collar 2 - 2017 | ||
Derivative [Line Items] | ||
Average Daily Volume (MMBtus or Bbls) | bbl | 250 | [3] |
Total of Notional Volume (Bbls) | bbl | 91,250 | |
Crude Oil | Costless Three-way Collar 2 - 2017 | Long | ||
Derivative [Line Items] | ||
Floor (Long) (Price per MMBtu or Bbl) | 80 | |
Crude Oil | Costless Three-way Collar 2 - 2017 | Short | ||
Derivative [Line Items] | ||
Put (Short) (Price per MMBtu or Bbl) | 60 | |
Ceiling (Short) (Price per MMBtu or Bbl) | 98.70 | |
Crude Oil | Protective Spread 1 - 2017 | ||
Derivative [Line Items] | ||
Average Daily Volume (MMBtus or Bbls) | bbl | 200 | [3],[4] |
Total of Notional Volume (Bbls) | bbl | 36,200 | [4] |
Base Fixed Price (Price per MMBtu or Bbl) | 60 | [4] |
Crude Oil | Protective Spread 1 - 2017 | Short | ||
Derivative [Line Items] | ||
Put (Short) (Price per MMBtu or Bbl) | 42.50 | [4] |
Crude Oil | Put Spread - 2017 | ||
Derivative [Line Items] | ||
Average Daily Volume (MMBtus or Bbls) | bbl | 500 | [3] |
Total of Notional Volume (Bbls) | bbl | 182,500 | |
Crude Oil | Put Spread - 2017 | Long | ||
Derivative [Line Items] | ||
Floor (Long) (Price per MMBtu or Bbl) | 82 | |
Crude Oil | Put Spread - 2017 | Short | ||
Derivative [Line Items] | ||
Put (Short) (Price per MMBtu or Bbl) | 62 | |
Crude Oil | Protective Spread 2 - 2017 | ||
Derivative [Line Items] | ||
Average Daily Volume (MMBtus or Bbls) | bbl | 200 | [3],[4] |
Total of Notional Volume (Bbls) | bbl | 36,200 | [4] |
Base Fixed Price (Price per MMBtu or Bbl) | 57.50 | [4] |
Crude Oil | Protective Spread 2 - 2017 | Short | ||
Derivative [Line Items] | ||
Put (Short) (Price per MMBtu or Bbl) | 42.50 | [4] |
Crude Oil | Fixed Price Swap 1 - 2017 | ||
Derivative [Line Items] | ||
Average Daily Volume (MMBtus or Bbls) | bbl | 300 | [3],[4] |
Total of Notional Volume (Bbls) | bbl | 54,300 | [4] |
Base Fixed Price (Price per MMBtu or Bbl) | 50.10 | [4] |
Crude Oil | Costless Three-way Collar 3 - 2017 | ||
Derivative [Line Items] | ||
Average Daily Volume (MMBtus or Bbls) | bbl | 200 | [3],[5] |
Total of Notional Volume (Bbls) | bbl | 36,800 | [5] |
Crude Oil | Costless Three-way Collar 3 - 2017 | Long | ||
Derivative [Line Items] | ||
Floor (Long) (Price per MMBtu or Bbl) | 60 | [5] |
Crude Oil | Costless Three-way Collar 3 - 2017 | Short | ||
Derivative [Line Items] | ||
Put (Short) (Price per MMBtu or Bbl) | 42.50 | [5] |
Ceiling (Short) (Price per MMBtu or Bbl) | 85 | [5] |
Crude Oil | Costless Three-way Collar 4 - 2017 | ||
Derivative [Line Items] | ||
Average Daily Volume (MMBtus or Bbls) | bbl | 200 | [3],[5] |
Total of Notional Volume (Bbls) | bbl | 36,800 | [5] |
Crude Oil | Costless Three-way Collar 4 - 2017 | Long | ||
Derivative [Line Items] | ||
Floor (Long) (Price per MMBtu or Bbl) | 57.50 | [5] |
Crude Oil | Costless Three-way Collar 4 - 2017 | Short | ||
Derivative [Line Items] | ||
Put (Short) (Price per MMBtu or Bbl) | 42.50 | [5] |
Ceiling (Short) (Price per MMBtu or Bbl) | 76.13 | [5] |
Crude Oil | Fixed Price Swap 2 - 2017 | ||
Derivative [Line Items] | ||
Average Daily Volume (MMBtus or Bbls) | bbl | 200 | [2],[3] |
Total of Notional Volume (Bbls) | bbl | 18,000 | [2] |
Base Fixed Price (Price per MMBtu or Bbl) | 50.05 | [2] |
Crude Oil | Put Spread - 2018 | ||
Derivative [Line Items] | ||
Average Daily Volume (MMBtus or Bbls) | bbl | 425 | [3],[6] |
Total of Notional Volume (Bbls) | bbl | 103,275 | [6] |
Crude Oil | Put Spread - 2018 | Long | ||
Derivative [Line Items] | ||
Floor (Long) (Price per MMBtu or Bbl) | 80 | [6] |
Crude Oil | Put Spread - 2018 | Short | ||
Derivative [Line Items] | ||
Put (Short) (Price per MMBtu or Bbl) | 60 | [6] |
[1] | For the month of October 2016. | |
[2] | For the period January to March 2017. | |
[3] | Crude volumes hedged include oil, condensate and certain components of our NGLs production. | |
[4] | For the period January to June 2017. | |
[5] | For the period July to December 2017. | |
[6] | For the period January to August 2018. |
Derivative Instruments and He42
Derivative Instruments and Hedging Activity (Summary of Information Regarding Deferred Put Premium Liabilities) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2016 | Sep. 30, 2016 | Dec. 31, 2015 | |
Derivative Instruments And Hedging Activities Disclosure [Abstract] | ||||
Current commodity derivative put premium payable | $ 1,750 | $ 3,194 | ||
Long-term commodity derivative put premium payable | 1,427 | 2,788 | ||
Total unamortized put premium liabilities | $ 3,177 | $ 3,177 | $ 3,177 | $ 5,982 |
Put Premium Liabilities [Roll Forward] | ||||
Put premium liabilities, beginning balance | 3,546 | 5,982 | ||
Settlement of put premium liabilities | (369) | (2,640) | ||
Additional put premium liabilities | (165) | |||
Put premium liabilities, ending balance | $ 3,177 | $ 3,177 |
Derivative Instruments and He43
Derivative Instruments and Hedging Activity (Summary of Amortization of Deferred Put Premium Liabilities) (Details) - USD ($) $ in Thousands | Sep. 30, 2016 | Jun. 30, 2016 | Dec. 31, 2015 |
Derivative Instruments And Hedging Activities Disclosure [Abstract] | |||
October to December 2016 | $ 554 | ||
January to December 2017 | 1,654 | ||
January to August 2018 | 969 | ||
Total unamortized put premium liabilities | $ 3,177 | $ 3,546 | $ 5,982 |
Derivative Instruments and He44
Derivative Instruments and Hedging Activity (Summary of Information on the Location and Amounts of Derivative Fair Values and Derivative Gains and Losses) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | Dec. 31, 2015 | |
Derivatives, Fair Value [Line Items] | |||||
(Loss) gain on commodity derivatives contracts | $ (1,498) | $ 11,301 | $ (3,991) | $ 19,734 | |
Commodity Contract | |||||
Derivatives, Fair Value [Line Items] | |||||
(Loss) gain on commodity derivatives contracts | (1,498) | 11,301 | (3,991) | 19,734 | |
Commodity Contract | Gain (loss) on commodity derivatives contracts | |||||
Derivatives, Fair Value [Line Items] | |||||
(Loss) gain on commodity derivatives contracts | (1,498) | $ 11,301 | (3,991) | $ 19,734 | |
Commodity Contract | Derivatives not designated as hedging instruments | |||||
Derivatives, Fair Value [Line Items] | |||||
Total derivatives not designated as hedging instruments | 9,053 | 9,053 | $ 24,418 | ||
Commodity Contract | Current assets | Derivatives not designated as hedging instruments | |||||
Derivatives, Fair Value [Line Items] | |||||
Commodity derivative contracts, Assets | 5,240 | 5,240 | 15,534 | ||
Commodity Contract | Other assets | Derivatives not designated as hedging instruments | |||||
Derivatives, Fair Value [Line Items] | |||||
Commodity derivative contracts, Assets | 3,915 | 3,915 | 9,335 | ||
Commodity Contract | Current liabilities | Derivatives not designated as hedging instruments | |||||
Derivatives, Fair Value [Line Items] | |||||
Commodity derivative contracts, Liabilities | (102) | (102) | 0 | ||
Commodity Contract | Long-term liabilities | Derivatives not designated as hedging instruments | |||||
Derivatives, Fair Value [Line Items] | |||||
Commodity derivative contracts, Liabilities | $ 0 | $ 0 | $ (451) |
Capital Stock (Narrative) (Deta
Capital Stock (Narrative) (Details) | May 12, 2016USD ($)$ / sharesshares | Mar. 09, 2016 | Jan. 18, 2016Right$ / shares | Apr. 24, 2014shares | Apr. 30, 2016USD ($) | Sep. 30, 2016USD ($)$ / sharesshares | Sep. 30, 2015USD ($) | Sep. 30, 2016USD ($)$ / sharesshares | Sep. 30, 2015USD ($) | Jun. 14, 2016shares | Dec. 31, 2015$ / sharesshares | May 07, 2015USD ($) |
Class Of Stock [Line Items] | ||||||||||||
Aggregate offering price | $ | $ 50,000,000 | |||||||||||
Issuance of shares - cash, net of offering costs (shares) | 0 | |||||||||||
Proceeds from issuance of common stock, net of issuance costs | $ | $ 44,815,000 | $ 0 | ||||||||||
Common stock, shares authorized | 550,000,000 | 550,000,000 | 275,000,000 | |||||||||
Number of rights issued on dividend declared | Right | 1 | |||||||||||
Dividend rights description | The Rights generally become exercisable on the earlier of (i) ten business days after any person or group obtains beneficial ownership of 4.9% of the Company’s outstanding common stock (an “Acquiring Person”) or (ii) ten business days after commencement of a tender or exchange offer resulting in any person or group becoming an Acquiring Person. | |||||||||||
Exercise price description | In the event that, after a person or a group has become an Acquiring Person, the Company is acquired in a merger or other business combination transaction (or 50% or more of the Company’s assets or earning power are sold), proper provision will be made so that each holder of a Right will thereafter have the right to receive, upon the exercise thereof at the then-current exercise price of the Right, that number of shares of common stock of the acquiring company having a market value at the time of that transaction equal to two times the exercise price. | |||||||||||
Percent of ownership in outstanding common stock | 4.90% | |||||||||||
Rights redemption price per right | $ / shares | $ 0.001 | |||||||||||
Rights exchange description | At any time after any person or group becomes an Acquiring Person, the Company may generally exchange each Right in whole or in part at an exchange ratio of two shares of common stock per outstanding Right, subject to adjustment. | |||||||||||
Expiration date of rights | Jan. 18, 2019 | |||||||||||
Preferred stock, shares authorized | 40,000,000 | 40,000,000 | 40,000,000 | |||||||||
Dividends on preferred stock | $ | $ 3,618,000 | $ 3,618,000 | $ 10,855,000 | $ 10,855,000 | ||||||||
Preferred stock dividends payment conditions applied commencement period | 2016-04 | |||||||||||
Common shares reserved for the exercise of stock options | 214,600 | 214,600 | ||||||||||
2006 Long-Term Stock Incentive Plan | ||||||||||||
Class Of Stock [Line Items] | ||||||||||||
Shares reserved for issuance under LTIP | 3,000,000 | |||||||||||
Shares available for future issuance (no more than) (shares) | 1,636,039 | 1,636,039 | ||||||||||
Series C Preferred Stock | ||||||||||||
Class Of Stock [Line Items] | ||||||||||||
Dividend payment terms | The dividend was paid to stockholders of record on January 28, 2016. Each Right entitles the holder, subject to the terms of the Rights Agreement, to purchase one one-thousandth of a share of the Company’s Series C Junior Participating Preferred Stock (the “Series C Preferred Stock”) at a price of $6.96, subject to certain adjustments. | |||||||||||
Preferred stock, dividend rate, per share | $ / shares | $ 6.96 | |||||||||||
Dividends payable record date | Jan. 28, 2016 | |||||||||||
Preferred stock, shares issued | 0 | 0 | ||||||||||
Series A Preferred Stock | ||||||||||||
Class Of Stock [Line Items] | ||||||||||||
Preferred stock, shares authorized | 10,000,000 | 10,000,000 | 10,000,000 | |||||||||
Preferred stock, dividend rate, percentage (percentage) | 8.625% | |||||||||||
Preferred stock, par value | $ / shares | $ 0.01 | $ 0.01 | $ 0.01 | |||||||||
Redemption price | $ / shares | $ 25 | $ 25 | $ 25 | |||||||||
Preferred stock, shares issued | 4,045,000 | 4,045,000 | 4,045,000 | |||||||||
Preferred stock, shares outstanding | 4,045,000 | 4,045,000 | 4,045,000 | |||||||||
Dividends declared or paid | $ | $ 0 | |||||||||||
Fixed rate preferred dividend increases percentage if suspension more than one year | 2.00% | |||||||||||
Dividends on preferred stock | $ | $ 2,200,000 | $ 6,600,000 | ||||||||||
Accumulated and unpaid dividends on preferred stock transferred to liquidation preference | $ | $ 4,400,000 | $ 4,400,000 | ||||||||||
Series B Preferred Stock | ||||||||||||
Class Of Stock [Line Items] | ||||||||||||
Preferred stock, shares authorized | 10,000,000 | 10,000,000 | 10,000,000 | |||||||||
Preferred stock, dividend rate, percentage (percentage) | 10.75% | |||||||||||
Preferred stock, par value | $ / shares | $ 0.01 | $ 0.01 | $ 0.01 | |||||||||
Redemption price | $ / shares | $ 25 | $ 25 | $ 25 | |||||||||
Preferred stock, shares issued | 2,140,000 | 2,140,000 | 2,140,000 | |||||||||
Preferred stock, shares outstanding | 2,140,000 | 2,140,000 | 2,140,000 | |||||||||
Dividends declared or paid | $ | $ 0 | |||||||||||
Fixed rate preferred dividend increases percentage if suspension more than one year | 2.00% | |||||||||||
Dividends on preferred stock | $ | $ 1,400,000 | $ 4,300,000 | ||||||||||
Accumulated and unpaid dividends on preferred stock transferred to liquidation preference | $ | $ 2,900,000 | $ 2,900,000 | ||||||||||
Preferred stock redemption price per share | $ / shares | $ 25 | $ 25 | ||||||||||
Period after change in control to redeem preferred stock | 90 days | |||||||||||
Option to convert shares of Series B Preferred Stock | $ / shares | $ 11.5207 | $ 11.5207 | ||||||||||
Gastar Exploration U S A | ||||||||||||
Class Of Stock [Line Items] | ||||||||||||
Shares of common stock in underwritten public offering | 50,000,000 | |||||||||||
Price per share of underwritten public offering | $ / shares | $ 0.95 | |||||||||||
Sales price of underwritten public offering before offering costs and expenses | $ | $ 47,500,000 | |||||||||||
Proceeds from issuance of common stock, net of issuance costs | $ | 44,800,000 | |||||||||||
Estimated offering costs and expenses | $ | $ 2,700,000 | |||||||||||
Common stock, shares authorized | 550,000,000 | 275,000,000 |
Capital Stock (Schedule of Issu
Capital Stock (Schedule of Issuances and Forfeitures of Common Shares) (Details) - shares | 3 Months Ended | 9 Months Ended | |
Sep. 30, 2016 | Sep. 30, 2016 | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Shares of common stock issued pursuant to PBUs vested, net of forfeitures | 0 | 502,593 | |
Restricted shares | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Shares of restricted common stock granted | 0 | 1,714,645 | |
Shares of restricted common stock vested | 33,075 | 1,472,915 | |
Shares of restricted common stock surrendered upon vesting/exercise | [1] | 3,664 | 389,905 |
Shares of restricted common stock forfeited | 0 | 126,336 | |
[1] | Represents shares of common stock forfeited in connection with the payment of estimated withholding taxes on shares of restricted common stock that vested during the period. |
Interest Expense (Schedule of C
Interest Expense (Schedule of Components of Interest Expense) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | ||
Interest Expense [Abstract] | |||||
Cash and accrued | $ 8,158 | $ 7,703 | $ 25,275 | $ 22,872 | |
Amortization of deferred financing costs | [1] | 986 | 916 | 3,812 | 2,652 |
Capitalized interest | (966) | (686) | (2,348) | (3,094) | |
Total interest expense | $ 8,178 | $ 7,933 | $ 26,739 | $ 22,430 | |
[1] | The three months ended September 30, 2016 and 2015 includes $711,000 and $644,000, respectively, of debt discount accretion related to the Notes. The nine months ended September 30, 2016 and 2015 includes $2.1 million and $1.9 million, respectively, of debt discount accretion related to the Notes. |
Interest Expense (Schedule of48
Interest Expense (Schedule of Components of Interest Expense) (Parenthetical) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Interest Expense [Abstract] | ||||
Accretion of debt discount | $ 711 | $ 644 | $ 2,100 | $ 1,900 |
Income Taxes (Narrative) (Detai
Income Taxes (Narrative) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Income Tax Disclosure [Abstract] | ||||
Current income tax benefit or provision | $ 0 | $ 0 | $ 0 | $ 0 |
Earnings per Share (Schedule of
Earnings per Share (Schedule of Earnings per Share, Basic and Diluted, by Common Class, Including Two Class Method) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Schedule of Earnings Per Share, Basic and Diluted, by Common Class, Including Two Class Method [Line Items] | ||||
Net loss attributable to common stockholders | $ (3,796) | $ (191,819) | $ (95,371) | $ (312,837) |
Weighted average common shares outstanding basic (shares) | 129,301,817 | 77,628,120 | 104,125,317 | 77,453,251 |
Incremental shares from unvested restricted shares | 0 | 0 | 0 | 0 |
Incremental shares from outstanding stock options | 0 | 0 | 0 | 0 |
Incremental shares from outstanding PBUs | 0 | 0 | 0 | 0 |
Weighted average common shares outstanding diluted (shares) | 129,301,817 | 77,628,120 | 104,125,317 | 77,453,251 |
Basic (dollars per share) | $ (0.03) | $ (2.47) | $ (0.92) | $ (4.04) |
Diluted (dollars per share) | $ (0.03) | $ (2.47) | $ (0.92) | $ (4.04) |
Common shares excluded from denominator as anti-dilutive (shares) | 1,211,855 | 742,432 | 1,378,193 | 230,432 |
Unvested restricted shares | ||||
Schedule of Earnings Per Share, Basic and Diluted, by Common Class, Including Two Class Method [Line Items] | ||||
Common shares excluded from denominator as anti-dilutive (shares) | 170,362 | 239,161 | 540,994 | 146,253 |
Unvested PBUs | ||||
Schedule of Earnings Per Share, Basic and Diluted, by Common Class, Including Two Class Method [Line Items] | ||||
Common shares excluded from denominator as anti-dilutive (shares) | 1,041,493 | 503,271 | 837,199 | 84,179 |
Commitments and Contingencies (
Commitments and Contingencies (Narrative) (Details) | Aug. 10, 2016USD ($) | May 03, 2016Officer | Dec. 17, 2010USD ($) | Dec. 29, 2015USD ($) |
Gastar Exploration Ltd vs US Specialty Ins Co and Axis Ins Co | ||||
Loss Contingencies [Line Items] | ||||
Settlement aggregate amount | $ 10,100,000 | $ 21,200,000 | ||
Directors and officers liability coverage limit | $ 20,000,000 | |||
Gastar Exploration Inc V Christopher Mc Arthur | Maximum | ||||
Loss Contingencies [Line Items] | ||||
Damages sought in arbitration matter | $ 2,750,000 | |||
Torchlight Energy Resources, Inc., Torchlight Energy, Inc. v. Husky Ventures, Inc. | ||||
Loss Contingencies [Line Items] | ||||
Number of executive officers filed lawsuit | Officer | 2 |
Statement of Cash Flows - Sup52
Statement of Cash Flows - Supplemental Information (Schedule of Supplemental Cash Paid and Non-cash Transactions) (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2016 | Sep. 30, 2015 | |
Supplemental Cash Flow Information [Abstract] | ||
Cash paid for interest, net of capitalized amounts | $ 16,140 | $ 12,699 |
Non-cash transactions: | ||
Capital expenditures included in (excluded from) accounts payable and accrued drilling costs | 4,913 | (12,396) |
Capital expenditures included in accounts receivable | 409 | |
Asset retirement obligation included in oil and natural gas properties | 128 | 276 |
Asset retirement obligation sold | (694) | |
Preferred dividends accrued but not declared | 7,237 | |
Application of advances to operators | (378) | $ 11,113 |
Expenses accrued for the issuance of common stock | $ 2 |