Document_and_Entity_Informatio
Document and Entity Information (USD $) | 12 Months Ended | ||
In Millions, except Share data, unless otherwise specified | Dec. 31, 2014 | Jun. 30, 2014 | Feb. 27, 2015 |
Entity Registrant Name | Jones Energy, Inc. | ||
Entity Central Index Key | 1573166 | ||
Document Type | 10-K | ||
Document Period End Date | 31-Dec-14 | ||
Amendment Flag | FALSE | ||
Current Fiscal Year End Date | -19 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Accelerated Filer | ||
Entity Public Float | $256 | ||
Document Fiscal Year Focus | 2014 | ||
Document Fiscal Period Focus | FY | ||
Class A common stock | |||
Entity Common Stock, Shares Outstanding | 25,208,402 | ||
Class B common stock | |||
Entity Common Stock, Shares Outstanding | 36,422,660 |
Consolidated_Balance_Sheets
Consolidated Balance Sheets (USD $) | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
In Thousands, unless otherwise specified | ||||
Current assets | ||||
Cash | $13,566 | $23,820 | ||
Restricted Cash | 149 | 45 | ||
Accounts receivable, net | ||||
Oil and gas sales | 49,861 | 51,233 | ||
Joint interest owners | 41,761 | 42,481 | ||
Other | 12,512 | 16,782 | ||
Commodity derivative assets | 121,519 | 8,837 | ||
Other current assets | 3,374 | 2,392 | ||
Deferred tax assets | 12 | |||
Total current assets | 242,742 | 145,602 | ||
Oil and gas properties, net, at cost under the successful efforts method | 1,638,860 | 1,297,228 | ||
Other property, plant and equipment, net | 4,048 | 3,444 | ||
Commodity derivative assets | 87,055 | 25,398 | ||
Other assets | 20,352 | 15,006 | ||
Deferred tax assets | 171 | 1,301 | ||
Total assets | 1,993,228 | 1,487,979 | ||
Current liabilities | ||||
Trade accounts payable | 136,337 | 89,430 | ||
Oil and gas sales payable | 70,469 | 66,179 | ||
Accrued liabilities | 19,401 | 10,805 | ||
Commodity derivative liabilities | 10,664 | |||
Deferred tax liabilities | 718 | |||
Asset retirement obligations | 3,074 | 2,590 | ||
Total current liabilities | 229,999 | 179,668 | ||
Long-term debt | 360,000 | 658,000 | ||
Senior notes | 500,000 | |||
Deferred revenue | 13,377 | 14,531 | ||
Commodity derivative liabilities | 28 | 190 | ||
Asset retirement obligations | 10,536 | 8,373 | ||
Liability under tax receivable agreement | 803 | |||
Deferred tax liabilities | 26,612 | 3,093 | ||
Total liabilities | 1,141,355 | 863,855 | ||
Commitments and contingencies (Note 10) | ||||
Stockholders' equity | ||||
Treasury stock, at cost; 22,602 shares at December 31, 2014 and 0 shares at December 31, 2013 | -358 | |||
Additional paid-in-capital | 177,133 | 173,169 | ||
Retained earnings (deficit) | 38,682 | -2,186 | ||
Stockholders' equity | 215,507 | 171,033 | ||
Non-controlling interest | 636,366 | 453,091 | ||
Total stockholders' equity | 851,873 | 624,124 | 428,400 | 345,909 |
Total liabilities and stockholders' equity | 1,993,228 | 1,487,979 | ||
Class A common stock | ||||
Stockholders' equity | ||||
Common Stock | 13 | 13 | ||
Class B common stock | ||||
Stockholders' equity | ||||
Common Stock | $37 | $37 |
Consolidated_Balance_Sheets_Pa
Consolidated Balance Sheets (Parenthetical) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Treasury stock, shares | 22,602 | 0 |
Class A common stock | ||
Common Stock, par value (in dollars per share) | 0.001 | 0.001 |
Common Stock, shares issued | 12,672,260 | 12,526,580 |
Common Stock, shares outstanding | 12,649,658 | 12,526,580 |
Class B common stock | ||
Common Stock, par value (in dollars per share) | 0.001 | 0.001 |
Common Stock, shares issued | 36,719,499 | 36,836,333 |
Common Stock, shares outstanding | 36,719,499 | 36,836,333 |
Consolidated_Statements_of_Ope
Consolidated Statements of Operations (USD $) | 12 Months Ended | ||
In Thousands, except Share data, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Operating revenues | |||
Oil and gas sales | $378,401 | $258,063 | $148,967 |
Other revenues | 2,196 | 1,106 | 847 |
Total operating revenues | 380,597 | 259,169 | 149,814 |
Operating costs and expenses | |||
Lease operating | 43,843 | 27,781 | 23,097 |
Production taxes | 18,094 | 12,865 | 5,583 |
Exploration | 3,453 | 1,710 | 356 |
Depletion, depreciation and amortization | 181,669 | 114,136 | 80,709 |
Impairment of oil and gas properties | 14,415 | 18,821 | |
Accretion of discount | 770 | 608 | 533 |
General and administrative (including non-cash compensation expense) | 25,763 | 31,902 | 15,875 |
Total operating expenses | 273,592 | 203,417 | 144,974 |
Operating income | 107,005 | 55,752 | 4,840 |
Other income (expense) | |||
Interest expense | -46,726 | -30,774 | -25,292 |
Net gain (loss) on commodity derivatives | 189,641 | -2,566 | 16,684 |
Gain (loss) on sales of assets | 297 | -78 | 1,162 |
Other income (expense), net | 143,212 | -33,418 | -7,446 |
Income (loss) before income tax | 250,217 | 22,334 | -2,606 |
Income tax provision (benefit) | |||
Current | 53 | 85 | |
Deferred | 26,021 | -156 | 473 |
Total income tax provision | 26,074 | -71 | 473 |
Net income (loss) | 224,143 | 22,405 | -3,079 |
Net income attributable to non-controlling interests | 183,275 | 24,591 | |
Net income (loss) attributable to controlling interests | $40,868 | ($2,186) | ($3,079) |
Earnings per share: | |||
Basic | $3.26 | ($0.17) | |
Diluted | $3.26 | ($0.17) | |
Weighted average shares outstanding: | |||
Basic | 12,526 | 12,500 | |
Diluted | 12,535 | 12,500 |
Consolidated_Statement_of_Chan
Consolidated Statement of Changes In Stockholders' / Members' Equity (USD $) | Common Stock | Common Stock | Treasury Stock | Members' Equity | Additional Paid-in-Capital | Retained (Deficit) Earnings | Non-controlling Interest | Total |
In Thousands, except Share data, unless otherwise specified | Class A common stock | Class B common stock | Class A common stock | |||||
Balance - Members' Equity at Dec. 31, 2011 | $345,909 | |||||||
Balance - Total Stockholders' / Members' Equity at Dec. 31, 2011 | 345,909 | |||||||
Increase (Decrease) Stockholders' equity | ||||||||
Issuance of Class C Preferred Units | 85,000 | 85,000 | ||||||
Stock-compensation expense | 570 | 570 | ||||||
Net income (loss) | -3,079 | -3,079 | ||||||
Balance - Members' Equity at Dec. 31, 2012 | 428,400 | |||||||
Balance - Total Stockholders' / Members' Equity at Dec. 31, 2012 | 428,400 | |||||||
Increase (Decrease) Stockholders' equity | ||||||||
Issuance of common stock | 13 | 37 | ||||||
Issuance of common stock (in shares) | 12,500 | 36,836 | ||||||
Issuance of Class C Preferred Units | 50 | |||||||
Proceeds from the sale of common stock | 172,431 | 172,431 | ||||||
Reclassification of members' contributions | -464,037 | 464,037 | ||||||
Stock-compensation expense | 10,100 | 738 | 10,838 | |||||
Distribution to members | -10,000 | -10,000 | ||||||
Net income (loss) | 35,537 | -2,186 | -10,946 | 22,405 | ||||
Balance (in shares) at Dec. 31, 2013 | 12,500 | 36,836 | ||||||
Balance - Total Stockholders' / Members' Equity at Dec. 31, 2013 | 13 | 37 | 173,169 | -2,186 | 453,091 | 624,124 | ||
Increase (Decrease) Stockholders' equity | ||||||||
Vested restricted shares | 28 | |||||||
Stock-compensation expense | 4,040 | 4,040 | ||||||
Exchange of Class B Shares for Class A Shares (in dollars) | -76 | -76 | ||||||
Exchange of Class B shares for Class A shares (in shares) | 117 | -117 | ||||||
Treasury Stock | -358 | -358 | ||||||
Treasury Stock (in shares) | -23 | 23 | ||||||
Net income (loss) | 40,868 | 183,275 | 224,143 | |||||
Balance (in shares) at Dec. 31, 2014 | 12,622 | 36,719 | 23 | |||||
Balance - Total Stockholders' / Members' Equity at Dec. 31, 2014 | $13 | $37 | ($358) | $177,133 | $38,682 | $636,366 | $851,873 |
Consolidated_Statements_of_Cas
Consolidated Statements of Cash Flows (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Cash flows from operating activities | |||
Net income (loss) | $224,143 | $22,405 | ($3,079) |
Adjustments to reconcile net income (loss) to net cash provided by operating activities | |||
Depletion, depreciation, and amortization | 181,669 | 114,136 | 80,709 |
Exploration expense | 2,952 | ||
Impairment of oil and gas properties | 14,415 | 18,821 | |
Accretion of discount | 770 | 608 | 533 |
Amortization of debt issuance costs | 6,878 | 2,677 | 3,544 |
Accrued interest expense | 7,823 | 1,891 | 456 |
Stock compensation expense | 4,040 | 10,838 | 570 |
Other non-cash compensation expense (Note 9) | 758 | 2,719 | |
Amortization of deferred revenue | -1,154 | -469 | |
(Gain) loss on commodity derivatives | -189,641 | 2,566 | -16,684 |
(Gain) loss on sales of assets | -297 | 78 | -1,162 |
Deferred income tax provision | 26,021 | -156 | 473 |
Other - net | 376 | 79 | 129 |
Changes in assets and liabilities | |||
Accounts receivable | -832 | -56,804 | 11,568 |
Other assets | -565 | 163 | 1,873 |
Accounts payable and accrued liabilities | 2,482 | 33,427 | -13,201 |
Net cash provided by operations | 265,423 | 148,573 | 84,550 |
Cash flows from investing activities | |||
Additions to oil and gas properties | -474,619 | -197,618 | -125,493 |
Acquisition of properties | -178,173 | -249,007 | |
Net adjustments to purchase price of properties acquired | 15,709 | ||
Proceeds from sales of assets | 448 | 1,607 | 9,158 |
Acquisition of other property, plant and equipment | -1,683 | -1,634 | -969 |
Current period settlements of matured derivative contracts | -3,654 | 7,586 | 28,675 |
Change in restricted cash | -104 | -45 | |
Net cash (used in) investing | -463,903 | -368,277 | -337,636 |
Cash flows from financing activities | |||
Proceeds from issuance of long-term debt | 170,000 | 220,000 | 233,243 |
Repayment under long-term debt | -468,000 | -172,000 | -38,243 |
Proceeds from senior notes | 500,000 | ||
Payment of debt issuance costs | -13,416 | -683 | -9,324 |
Issuance of preferred units | 85,000 | ||
Proceeds from sale of common stock, net of expenses of $15.1 million | 172,481 | ||
Purchases of treasury stock | -358 | ||
Net cash provided by financing | 188,226 | 219,798 | 270,676 |
Net increase (decrease) in cash | -10,254 | 94 | 17,590 |
Cash | |||
Beginning of period | 23,820 | 23,726 | 6,136 |
End of period | 13,566 | 23,820 | 23,726 |
Supplemental disclosure of cash flow information | |||
Cash paid for interest | 29,560 | 25,414 | 20,759 |
Cash paid for income taxes | 155 | ||
Change in accrued additions to oil and gas properties | 49,025 | 41,945 | 3,355 |
Noncash acquisition of oil and gas properties | 2,918 | ||
Current additions to ARO | 1,995 | 1,516 | 662 |
Noncash distributions to members (Note 9) | $10,000 |
Consolidated_Statements_of_Cas1
Consolidated Statements of Cash Flows (Parenthetical) (USD $) | 12 Months Ended |
In Millions, unless otherwise specified | Dec. 31, 2013 |
Consolidated Statements of Cash Flows | |
Payment of stock issuance expenses | $15.10 |
Organization_and_Description_o
Organization and Description of Business | 12 Months Ended |
Dec. 31, 2014 | |
Organization and Description of Business | |
Organization and Description of Business | |
1. Organization and Description of Business | |
Organization | |
Jones Energy, Inc. (the "Company") was formed in March 2013 as a Delaware corporation to become a publicly-traded entity and the holding company of Jones Energy Holdings, LLC ("JEH"). As the sole managing member of JEH, the Company is responsible for all operational, management and administrative decisions relating to JEH's business and consolidates the financial results of JEH and its subsidiaries. | |
JEH was formed as a Delaware limited liability company on December 16, 2009 through investments made by the Jones family and through private equity funds managed by Metalmark Capital and Wells Fargo Energy Capital. JEH acts as a holding company of operating subsidiaries that own and operate assets that are used in the exploration, development, production and acquisition of oil and natural gas properties. | |
The Company's certificate of incorporation authorizes two classes of common stock, Class A common stock and Class B common stock. The Class B common stock is held by the owners of JEH prior to the Company's initial public offering ("IPO") and can be exchanged (together with a corresponding number of units representing membership interests in JEH ("JEH Units")) for shares of Class A common stock on a one-for-one basis, subject to customary conversion rate adjustments for stock splits, stock dividends and reclassifications and other similar transactions. The Class B common stock has no economic rights but entitles its holder to one vote on all matters to be voted on by the Company's stockholders generally. As a result of the IPO, the pre-IPO owners retained 74.7% of the total economic interest in JEH, but with no voting rights or management power over JEH, resulting in the Company reporting this ownership interest as a non-controlling interest. Prior to the IPO, JEH owned the controlling interest in the Company; hence all of the net income earned prior to the IPO date is reflected in the net income attributable to non-controlling interests on the Consolidated Statement of Operations for the year ended December 31, 2013. | |
Description of Business | |
The Company is engaged in the acquisition, exploration, and production of oil and natural gas properties in the mid-continent United States. The Company's assets are located within two distinct basins in the Texas Panhandle and Oklahoma, the Anadarko Basin and the Arkoma Basin, and are owned by JEH and its operating subsidiaries. The Company is headquartered in Austin, Texas. | |
Significant_Accounting_Policie
Significant Accounting Policies | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Significant Accounting Policies | ||||||||
Significant Accounting Policies | ||||||||
2. Significant Accounting Policies | ||||||||
Basis of Presentation | ||||||||
The accompanying financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP"). All significant intercompany transactions and balances have been eliminated in consolidation. The financial statements reported for December 31, 2014 and 2013 and the results of the operations and the cash flows for each of the three years in the period ended December 31, 2014 include the Company and all of its subsidiaries. | ||||||||
Segment Information | ||||||||
The Company operates in one industry segment, which is the exploration, development and production of oil and natural gas, and all of its operations are conducted in one geographic area of the United States. | ||||||||
Use of Estimates | ||||||||
In preparing the accompanying financial statements, management has made certain estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent liabilities, and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from these estimates. Changes in estimates are recorded prospectively. | ||||||||
Significant assumptions are required in the valuation of proved oil and natural gas reserves, which affect the Company's estimates of depletion expense, impairment, and the allocation of value in our business combinations. Significant assumptions are also required in the Company's estimates of the net gain or loss on commodity derivative assets and liabilities, fair value associated with business combinations, and asset retirement obligations ("ARO"). | ||||||||
Financial Instruments | ||||||||
Cash, accounts receivable and accounts payable are recorded at cost. The fair value of accounts receivable and accounts payable are not materially different from their carrying amounts because of the short-term nature of these instruments. The carrying value of the outstanding balance under the Company's Revolver (as defined in Note 6) represents fair value because the Revolver has variable interest rates, which are reflective of the Company's credit risk. The Company's senior notes have a fixed interest rate and are reported at historical value as of the initial measurement date when issued and their fair value is discussed in Note 4. Derivative instruments are recorded at fair value, as discussed below. | ||||||||
Cash | ||||||||
Cash and cash equivalents include highly liquid investments with a maturity of three months or less. At times, the amount of cash on deposit in financial institutions exceeds federally insured limits. Management monitors the soundness of the financial institutions and believes the Company's risk is not significant. | ||||||||
Accounts Receivable | ||||||||
Accounts receivable—Oil and gas sales consist of uncollateralized accrued revenues due under normal trade terms, generally requiring payment within 30 to 60 days of production. Accounts receivable—Joint interest owners consist of uncollateralized joint interest owner obligations due within 30 days of the invoice date. Accounts receivable—Other consists at December 31, 2014 of derivative positions not settled as of the balance sheet date and severance tax refunds due from state agencies and at December 31, 2013 of the adjustments to the purchase price of the Sabine properties purchased in December 2013 and severance tax refunds due from state agencies. No interest is charged on past-due balances. The Company routinely assesses the recoverability of all material trade, joint interest and other receivables to determine their collectability, and reduces the carrying amounts by a valuation allowance that reflects management's best estimate of the amounts that may not be collected. As of December 31, 2014 and 2013, the Company did not have significant allowances for doubtful accounts. | ||||||||
Concentration of Risk | ||||||||
Substantially all of the Company's accounts receivable are related to the oil and gas industry. This concentration of entities may affect the Company's overall credit risk in that these entities may be affected similarly by changes in economic and other conditions, including declines in commodity prices. As of December 31, 2014, 70% of Accounts receivable—Oil and gas sales are due from 5 purchasers and 67% of Accounts receivable—Joint interest owners are due from 5 working interest owners. As of December 31, 2013, 79% of Accounts receivable—Oil and gas sales were due from 8 purchasers, and 77% of 2013 Accounts receivable—Joint interest owners were due from 5 working interest owners. If any or all of these significant counterparties were to fail to pay amounts due to the Company, the Company's financial position and results of operations could be materially and adversely affected. | ||||||||
Dependence on Major Customers | ||||||||
The Company maintains a portfolio of crude oil and natural gas marketing contracts with large, established refiners and oil and gas purchasers. During the year ended December 31, 2014, the largest purchasers were Valero Energy Corp. ("Valero"), NGL Energy Partners LP, PVR Midstream LLC ("PVR Midstream"), Plains Marketing LP ("Plains Marketing"), and Monarch Natural Gas LLC which accounted for approximately 22%, 12%, 12%, 10% and 10% of consolidated oil and gas sales, respectively. During the year ended December 31, 2013, the largest purchasers were PVR Midstream, Unimark LLC, Mercuria Energy Group Ltd. ("Mercuria"), Valero, and Plains Marketing, which accounted for approximately 15%, 13%, 13%, 13% and 6% of consolidated oil and gas sales, respectively. During the year ended December 31, 2012, the largest purchasers were Unimark LLC, Mercuria, PVR Midstream, and Plains Marketing, which accounted for approximately 24%, 18%, 18% and 15% of consolidated oil and gas sales, respectively. | ||||||||
Management believes that there are alternative purchasers and that it may be necessary to establish relationships with such new purchasers. However, there can be no assurance that the Company can establish such relationships and that those relationships will result in an increased number of purchasers. Although the Company is exposed to a concentration of credit risk, management believes that all of the Company's purchasers are credit worthy. | ||||||||
Dependence on Suppliers | ||||||||
The Company's industry is cyclical, and from time to time, there can be an imbalance between the supply of and demand for drilling rigs, equipment, services, supplies and qualified personnel. During periods of oversupply, there can be financial pressure on suppliers. If the financial pressure leads to work interruptions or stoppages, the Company could be materially and adversely affected. Management believes that there are adequate alternative providers of drilling and completion services although it may become necessary to establish relationships with new contractors. However, there can be no assurance that the Company can establish such relationships and that those relationships will result in increased availability of drilling rigs or other services, or that they could be obtained on the same terms. | ||||||||
Oil and Gas Properties | ||||||||
The Company accounts for its oil and natural gas exploration and production activities under the successful efforts method of accounting. Oil and gas properties consisted of the following at December 31, 2014 and 2013: | ||||||||
(in thousands of dollars) | 2014 | 2013 | ||||||
Mineral interests in properties | ||||||||
Unproved | $ | 94,526 | $ | 99,134 | ||||
Proved | 1,001,194 | 958,816 | ||||||
Wells and equipment and related facilities | 1,094,202 | 609,748 | ||||||
| | | | | | | | |
2,189,922 | 1,667,698 | |||||||
Less: Accumulated depletion and impairment | (551,062 | ) | (370,470 | ) | ||||
| | | | | | | | |
Net oil and gas properties | $ | 1,638,860 | $ | 1,297,228 | ||||
| | | | | | | | |
| | | | | | | | |
Costs to acquire mineral interests in oil and natural gas properties are capitalized. Costs to drill and equip development wells and the related asset retirement costs are capitalized. The costs to drill and equip exploratory wells are capitalized pending determination of whether the Company has discovered proved commercial reserves. If proved commercial reserves are not discovered, such drilling costs are charged to expense. In some circumstances, it may be uncertain whether proved commercial reserves have been found when drilling has been completed. Such exploratory well drilling costs may continue to be capitalized if the anticipated reserve quantity is sufficient to justify its completion as a producing well and sufficient progress in assessing the reserves and the economic and operating viability of the project is being made. As of December 31, 2014 and 2013, we had no material capitalized costs associated with exploratory wells. | ||||||||
The Company capitalizes interest on expenditures for significant exploration and development projects that last more than six months while activities are in progress to bring the assets to their intended use. The Company capitalized less than $0.1 million in interest costs during 2014 for one project. No interest costs were capitalized in 2013. Costs incurred to maintain wells and related equipment are charged to expense as incurred. | ||||||||
On the sale or retirement of a proved field, the cost and related accumulated depletion, depreciation and amortization are eliminated from the field accounts, and the resultant gain or loss is recognized. | ||||||||
Capitalized amounts attributable to proved oil and gas properties are depleted by the unit-of-production method over proved reserves, using the unit conversion ratio of six thousand cubic feet of gas to one barrel of oil equivalent. Depletion of the costs of wells and related equipment and facilities, including capitalized asset retirement costs, net of salvage values, is computed using proved developed reserves. The reserve base used to calculate depreciation, depletion, and amortization for leasehold acquisition costs and the cost to acquire proved properties is the sum of proved developed reserves and proved undeveloped reserves. Depletion of oil and gas properties amounted to $180.6 million, $113.3 million and $79.9 million for the years ended December 31, 2014, 2013 and 2012, respectively. | ||||||||
The Company reviews its proved oil and natural gas properties, including related wells and equipment, for impairment by comparing expected undiscounted future cash flows at a producing field level to the net capitalized cost of the asset. If the future undiscounted cash flows, based on the Company's estimate of future commodity prices, operating costs, and production, are lower than the net capitalized cost, the capitalized cost is reduced to fair value. Fair value is calculated by discounting the future cash flows at an appropriate risk-adjusted discount rate. Due to the significant assumptions associated with the inputs and calculations described, the fair value of oil and gas properties used in estimating impairment represents a nonrecurring Level 3 measurement. No impairments of proved properties were recorded in 2014 or 2013. The Company incurred impairment charges of $18.8 million related to its proved oil and natural gas properties and equipment in 2012. | ||||||||
The Company evaluates its unproved properties for impairment on a property-by-property basis. The Company's unproved property consists of acquisition costs related to its undeveloped acreage. The Company reviews the unproved property for indicators of impairment based on the Company's current exploration plans with consideration given to results of any drilling and seismic activity during the period and known information regarding exploration and development activity by other companies on adjacent blocks. The Company incurred no impairment charges related to its unproved properties in 2014 or 2012. In the fourth quarter of 2013, the Company recorded an impairment charge of $14.4 million related to its unproved Southridge properties in the Arkoma basin. As the Company did not drill the required number of wells by October 31, 2013 necessary to keep its joint development agreement with Southridge in effect, the Company lost its right to the undeveloped acreage. Impairment of oil and gas properties charges are recorded on the Consolidated Statement of Operations. | ||||||||
On the sale of an entire interest in an unproved property, gain or loss on the sale is recognized, taking into consideration the amount of any recorded impairment if the property had been assessed individually. If a partial interest in an unproved property is sold, the amount received is treated as a reduction of the cost of the interest retained. | ||||||||
Other Property, Plant and Equipment | ||||||||
Other property, plant and equipment consisted of the following at December 31, 2014 and 2013: | ||||||||
(in thousands of dollars) | 2014 | 2013 | ||||||
Leasehold improvements | $ | 1,218 | $ | 1,060 | ||||
Furniture, fixtures, computers and software | 3,727 | 2,491 | ||||||
Vehicles | 988 | 835 | ||||||
Aircraft | 910 | 910 | ||||||
Other | 219 | 134 | ||||||
| | | | | | | | |
7,062 | 5,430 | |||||||
Less: Accumulated depreciation and amortization | (3,014 | ) | (1,986 | ) | ||||
| | | | | | | | |
Net other property, plant and equipment | $ | 4,048 | $ | 3,444 | ||||
| | | | | | | | |
| | | | | | | | |
Other property, plant and equipment is depreciated on a straight-line basis over the estimated useful lives of the property, plant and equipment, which range from three years to ten years. Depreciation and amortization of other property, plant and equipment amounted to $1.1 million, $0.8 million and $0.8 million during the years ended December 31, 2014, 2013 and 2012, respectively. | ||||||||
Oil and Gas Sales Payable | ||||||||
Oil and gas sales payable represents amounts collected from purchasers for oil and gas sales, which are due to other revenue interest owners. Generally, the Company is required to remit amounts due under these liabilities within 60 days of receipt. | ||||||||
Commodity Derivatives | ||||||||
The Company records its commodity derivative instruments on the Consolidated Balance Sheet as either an asset or liability measured at its fair value. Changes in the derivative's fair value are recognized currently in earnings, unless specific hedge accounting criteria are met. During the years ended December 31, 2014, 2013 and 2012, the Company elected not to designate any of its commodity price risk management activities as cash flow or fair value hedges. The changes in the fair values of outstanding financial instruments are recognized as gains or losses in the period of change. | ||||||||
Although the Company does not designate its commodity derivative instruments as cash-flow hedges, management uses those instruments to reduce the Company's exposure to fluctuations in commodity prices related to its natural gas and oil production. Net gains and losses, at fair value, are included on the Consolidated Balance Sheet as current or noncurrent assets or liabilities based on the anticipated timing of cash settlements under the related contracts. Changes in the fair value of commodity derivative contracts are recorded in earnings as they occur and are included in other income (expense) on the Consolidated Statement of Operations. See Note 4, "Fair Value Measurement," for disclosure about the fair values of commodity derivative instruments. | ||||||||
Asset Retirement Obligations | ||||||||
The Company's asset retirement obligations ("ARO") consist of future plugging and abandonment expenses on oil and natural gas properties. The Company estimates an ARO for each well in the period in which it is incurred based on estimated present value of plugging and abandonment costs, increased by an inflation factor to the estimated date that the well would be plugged. The resulting liability is recorded by increasing the carrying amount of the related long- lived asset. The liability is then accreted to its then-present value each period and the capitalized cost is depleted over the useful life of the related asset. If the liability is settled for an amount other than the recorded amount, a gain or loss is recognized. The ARO is classified as current or noncurrent based on the expect timing of payments. A summary of the Company's ARO for the years ended December 31, 2014 and 2013 is as follows: | ||||||||
(in thousands of dollars) | 2014 | 2013 | ||||||
ARO liability at beginning of year | $ | 10,963 | $ | 9,506 | ||||
Liabilities incurred(1) | 1,995 | 1,515 | ||||||
Accretion of discount | 770 | 608 | ||||||
Liabilities settled due to sale of related properties | (109 | ) | (271 | ) | ||||
Liabilities settled due to plugging and abandonment | (55 | ) | (702 | ) | ||||
Change in estimate | 46 | 307 | ||||||
| | | | | | | | |
ARO liability at end of year | 13,610 | 10,963 | ||||||
Less: Current portion of ARO at end of year | (3,074 | (2,590 | ||||||
) | ) | |||||||
| | | | | | | | |
Total long-term ARO at end of year | $ | 10,536 | $ | 8,373 | ||||
| | | | | | | | |
| | | | | | | | |
-1 | Includes $824 related to wells acquired in 2013 (see Note 3, "Acquisition of Properties"). | |||||||
Revenue Recognition | ||||||||
Revenues from the sale of crude oil, natural gas, and natural gas liquids are recognized when the product is delivered at a fixed or determinable price, title has transferred, collectability is reasonably assured and evidenced by a contract. The Company follows the "sales method" of accounting for its oil and natural gas revenue, so it recognizes revenue on all crude oil, natural gas, and natural gas liquids sold to purchasers. A receivable or liability is recognized only to the extent that the Company has an imbalance on a specific property greater than the expected remaining proved reserves. | ||||||||
Production Costs | ||||||||
Production costs, including compressor rental, pumpers' salaries, saltwater disposal, ad valorem taxes, insurance, repairs and maintenance, expensed workovers and other operating expenses are expensed as incurred and included in lease operating expense on the Consolidated Statement of Operations. | ||||||||
Exploration Expenses | ||||||||
Exploration expenses include dry hole costs, lease extensions, delay rentals and geological and geophysical costs. | ||||||||
Income Taxes | ||||||||
Following its IPO on July 29, 2013, the Company began recording a federal and state income tax liability associated with its status as a corporation. No provision for federal income taxes was recorded prior to the IPO because the taxable income or loss was includable in the income tax returns of the individual partners and members. The Company is also subject to state income taxes. The State of Texas includes in its tax system a franchise tax applicable to the Company and an accrual for franchise taxes is included in the financial statements when appropriate. | ||||||||
Income taxes are accounted for under the asset and liability method, which requires recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements. Under this method, deferred tax assets and liabilities are determined based on the differences between the financial statements and tax basis of assets and liabilities using enacted tax rates in effect for the year in which differences are expected to be recovered or settled pursuant to the provisions of ASC 740—Income Taxes. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period that includes the enactment date. | ||||||||
The Company records a valuation allowance if it is deemed more likely than not that all or a portion of its deferred income tax assets will not be realized. In addition, income tax rules and regulations are subject to interpretation and the application of those rules and regulations require judgment by the Company and may be challenged by the taxation authorities. The Company follows ASC 740-10-25, which requires the use of a two-step approach for recognizing and measuring tax benefits taken or expected to be taken in a tax return and disclosures regarding uncertainties in income tax positions. Only tax positions that meet the more likely than not recognition threshold are recognized. The Company's policy is to include any interest and penalties recorded on uncertain tax positions as a component of income tax expense. The Company's unrecognized tax benefits or related interest and penalties are immaterial. | ||||||||
Liability under Tax Receivable Agreement | ||||||||
In connection with the IPO, the Company entered into a Tax Receivable Agreement (the "TRA") which obligated the Company to make payments to certain current and former owners equal to 85% of the applicable cash savings that the Company realizes as a result of tax attributes arising from exchanges of JEH Units and JEI Class B shares held by those owners for Class A shares of JEI common stock. The Company will retain the benefit of the remaining 15% of these tax savings. | ||||||||
As a result of exchanges made through December 31, 2014, the Company has accrued future tax benefits of $0.9 million and has recorded this amount as a deferred tax asset on its consolidated balance sheet. As of December 31, 2014, the Company has recorded a liability of $0.8 million associated with its future TRA obligation. The actual amount and timing of payments made under the TRA will depend upon a number of factors, including the amount and timing of taxable income generated in the future, changes in future tax rates, the use of loss carryovers, and the portion of the Company's payments under the TRA constituting imputed interest. To the extent the Company does not realize all of the tax benefits in future years or in the event of a change in future tax rates, this liability may change. | ||||||||
As of December 31, 2014, the Company has made no payments under the TRA and does not anticipate making a material payment under the TRA in 2015. | ||||||||
Comprehensive Income | ||||||||
The Company has no elements of comprehensive income other than net income. | ||||||||
Statement of Cash Flows | ||||||||
The Company presents its cash flows using the indirect method. | ||||||||
Related Party Transactions | ||||||||
In the years ended December 31, 2013 and 2012, the Company paid an annual administration fee to Metalmark of $0.7 million. This amount was charged to expense. As a result of the IPO, this fee is no longer payable to Metalmark. | ||||||||
On May 7, 2013, the Company entered into a natural gas sale and purchase agreement with Monarch Natural Gas, LLC, ("Monarch"), under which Monarch has the first right to gather the natural gas the Company produces from dedicated properties, process the NGLs from this natural gas production and market the processed natural gas and extracted NGLs. Under the Monarch agreement, the Company is paid a specified percentage of the value of the NGLs extracted and sold by Monarch, based on a set liquids recovery percentage, and the amount received from the sale of the residue gas, after deducting a fixed volume for fuel, lost and unaccounted for gas. The Company produced approximately 1.4 MMBoe of natural gas and NGLs for the year ended December 31, 2014 and 0.8 MMBoe of natural gas and NGLs for the year ended December 31, 2013, from the properties that became subject to the Monarch agreement. The initial term of the agreement runs for 10 years from the effective date of September 1, 2013. | ||||||||
At the time the Company entered into the agreement, Metalmark Capital owned approximately 81% of the outstanding equity interests of Monarch. In addition, Metalmark Capital beneficially owns in excess of five percent of the Company's outstanding equity interests and two of our directors, Howard I. Hoffen and Gregory D. Myers, are managing directors of Metalmark Capital. In connection with the Company's entering into the Monarch agreement, Monarch issued to JEH equity interests in Monarch having a deemed value of $15 million. JEH assigned $2.4 million of the Monarch equity interests to Jonny Jones, the Company's chief executive officer and chairman of the board, and reserved $2.6 million of the Monarch equity interests to a benefit plan established for certain of the Company's officers, including Mike McConnell, Robert Brooks and Eric Niccum. The remaining $10 million of Monarch equity was distributed to certain of the pre-IPO owners, which include Metalmark Capital, Wells Fargo, the Jones family entities, and certain of the Company's officers and directors, including Jonny Jones, Mike McConnell and Eric Niccum. | ||||||||
In September 2014, the Company signed a 10-year oil gathering and transportation agreement with Monarch Oil Pipeline LLC, pursuant to which Monarch Oil Pipeline, LLC will build, at its expense, a new oil gathering system and connect to dedicated Company leases in Texas. At the time the Company entered into the agreement, Metalmark Capital owned the majority of the outstanding equity interests of Monarch Oil Pipeline, LLC and/or its parent. The system is expected to begin service during the second quarter of 2015 and provide connectivity to both a regional refinery market as well as the Cushing market hub. The Company has reserved capacity of up to 12,000 barrels per day on the system with the potential to increase throughput at a future date. | ||||||||
Stock Compensation | ||||||||
JEH implemented a management incentive plan effective January 1, 2010, that provided awards of membership interests in JEH to members of senior management ("management units"). The management unit grants awarded prior to the initial filing of the IPO registration statement in March 2013 had a dual vesting schedule and were fully vested as of December 31, 2014. Grants awarded after the initial IPO registration statement generally have a single vesting structure of five equal annual installments and were valued at the IPO price, adjusted for equivalent shares. Both the vested and unvested management units were converted into JEH Units and shares of Class B common stock at the IPO date. At December 31, 2014, there were 274,385 unvested JEH Units and shares of Class B common stock that will become convertible into a like number of shares of Class A common stock upon vesting. | ||||||||
Under the Jones Energy, Inc. 2013 Omnibus Incentive Plan, established in conjunction with the Company's IPO, the Company reserved 3,850,000 shares of Class A common stock for director and employee stock-based compensation awards. | ||||||||
During 2014, the Company granted performance unit and restricted stock unit awards to certain officers and employees under the Jones Energy, Inc. 2013 Omnibus Incentive Plan. The fair value of the performance units was based on the grant date fair value (using a Monte Carlo simulation model) and is expensed on a straight-line basis over the applicable three-year performance period. The number of shares of Class A common stock issuable upon vesting of the performance unit awards ranges from zero to 200% based on the Company's total shareholder return relative to an industry peer group over the applicable three-year performance period. The fair value of the restricted stock unit awards was based on the value of the Company's Class A common stock on the date of grant and is expensed on a straight-line basis over the applicable three-year vesting period. | ||||||||
In September 2014 and 2013, the Company granted each of the outside members of the Board of Directors 5,486 and 6,645 shares, respectively, of restricted Class A common stock under the Jones Energy, Inc. 2013 Omnibus Incentive Plan. The fair value of the restricted stock grants was based on the value of the Company's Class A common stock on the date of grant and is expensed on a straight-line basis over the one-year vesting period. | ||||||||
Refer to Note 7, "Stock-based Compensation," for additional information regarding director and employee stock-based compensation awards | ||||||||
Business Combinations | ||||||||
For acquisitions of working interests that are accounted for as business combinations, the results of operations are included in the Consolidated Statement of Operations from the date of acquisition. Purchase prices are allocated to assets acquired based on their estimated fair values at the time of acquisition. Fair value is the price that would be received to sell an asset or would be paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value measurement is based on the assumptions of market participants and not those of the reporting entity. Therefore, entity-specific intentions do not impact the measurement of fair value. The fair value of oil and natural gas properties is determined using a risk-adjusted after-tax discounted cash flow analysis based upon significant inputs including: 1) oil and gas prices, 2) projections of estimated quantities of oil and natural gas reserves, including those classified as proved, probable and possible, 3) projections of future rates of production, 4) timing and amount of future development and operating costs, 5) projected reserve recovery factors, and 6) weighted average cost of capital. | ||||||||
Recent Accounting Pronouncements | ||||||||
In May 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2014-09, "Revenue from Contracts with Customers," which creates a new topic in the Accounting Standards Codification ("ASC"), topic 606, "Revenue from Contracts with Customers." This ASU sets forth a five-step model for determining when and how revenue is recognized. Under the model, an entity will be required to recognize revenue to depict the transfer of goods or services to a customer at an amount reflecting the consideration it expects to receive in exchange for those goods or services. Additional disclosures will be required to describe the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts. The amendments are effective for fiscal years, and interim periods within those years, beginning after December 15, 2016 and may be applied on either a full or modified retrospective basis. Early adoption is not permitted. We do not expect the adoption of these provisions to have a significant impact on the Company's consolidated financial statements. However, we will continue to assess the anticipated impact as further implementation guidance is released from the FASB. | ||||||||
In August 2014, the FASB issued ASU No. 2014-15, "Presentation of Financial Statements—Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity's Ability to Continue as a Going Concern." This ASU requires management to evaluate whether there are conditions or events that raise substantial doubt about an entity's ability to continue as a "going concern" and to provide disclosures when certain criteria are met. Substantial doubt exists when relevant conditions and events, considered in the aggregate, indicate that it is probable that the entity will be unable to meet its obligations as they become due within one year after the date that the financial statements are issued (or available to be issued). The amendments are effective for fiscal years, and interim periods within those years, beginning after December 15, 2016. Early adoption is permitted. We do not expect the adoption of these disclosures to have a significant impact on the Company's consolidated financial statements. | ||||||||
In January 2015, the FASB issued Accounting Standards Update No. 2015-01, Income Statement—Extraordinary and Unusual Items ("ASU 2015-01"). ASU 2015-01 removes the concept of extraordinary items from GAAP. Under existing guidance, an entity is required to separately disclose extraordinary items, net of tax, in the income statement after income from continuing operations if an event or transaction is of an unusual nature and occurs infrequently. This separate, net-of-tax presentation will no longer be allowed. ASU 2015-01 is effective for interim and annual reporting periods beginning after December 15, 2015. The Company does not expect the adoption of this guidance to have a material impact on its financial position, cash flows or results of operations. | ||||||||
Acquisition_of_Properties
Acquisition of Properties | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Acquisition of Properties | ||||||||
Acquisition of Properties | ||||||||
3. Acquisition of Properties | ||||||||
No property acquisitions that would qualify as a business combination occurred during the twelve months ended December 31, 2014. | ||||||||
On December 18, 2013, JEH closed on the purchase of certain oil and natural gas properties located in Texas and western Oklahoma from Sabine Mid-Continent, LLC, for a purchase price of $193.5 million (referred to herein as the "Sabine acquisition" or "Sabine"), subject to customary closing adjustments. The acquired assets included both producing properties and undeveloped acreage. The purchase was financed with borrowings under the Revolver. In the second quarter of 2014, the Company made a final determination with the sellers as to the purchase price resulting in a final purchase price of $179.2 million. The amount of the total purchase price allocated to undeveloped oil and gas properties was reduced by these adjustments. The adjustments were retroactively applied to our December 31, 2013 Consolidated Balance Sheet as a reduction to oil and gas properties and an increase in receivables. The adjusted purchase price was allocated as follows: | ||||||||
(in thousands of dollars) | ||||||||
Oil and gas properties | ||||||||
Unproved | $ | 32,964 | ||||||
Proved | 147,024 | |||||||
Asset retirement obligations | (824 | ) | ||||||
| | | | | ||||
Total purchase price | $ | 179,164 | ||||||
| | | | | ||||
| | | | | ||||
The unaudited pro forma results presented below have been prepared to include the effect of the Sabine acquisition on our results of operations for the year ended December 31, 2013. The unaudited pro forma results do not purport to represent what our actual results of operations would have been if the acquisition had been completed on January 1, 2013 or to project our results of operations for any future date or period. | ||||||||
Year Ended | ||||||||
December 31, | ||||||||
Post | 2013 | |||||||
(in thousands of dollars) | Acquisition(1) | Pro Forma | ||||||
(unaudited) | (unaudited) | |||||||
Total operating revenue | $ | 1,365 | $ | 308,773 | ||||
Total operating expenses | 291 | 229,648 | ||||||
Operating income | 1,074 | 79,125 | ||||||
Net income | 1,074 | 45,778 | ||||||
-1 | Represents revenues and expenses for the post acquisition period of December 18, 2013 to December 31, 2013 included in the Consolidated Statement of Operations. | |||||||
On December 20, 2012, JEH acquired certain oil and natural gas properties located in Texas for a purchase price of $251.9 million (referred to herein as the "Chalker acquisition" or "Chalker"). The acquired assets included both producing properties and undeveloped acreage. The purchase was financed with additional equity capital and borrowings under the Revolver. In the second quarter of 2013, the Company made a final determination with the sellers as to the purchase price adjustments resulting in a final purchase price of $253.5 million. The final purchase price was allocated as follows: | ||||||||
(in thousands of dollars) | ||||||||
Oil and gas properties | ||||||||
Unproved | $ | 71,264 | ||||||
Proved | 182,493 | |||||||
Asset retirement obligations | (293 | ) | ||||||
| | | | | ||||
Total purchase price | $ | 253,464 | ||||||
| | | | | ||||
| | | | | ||||
The unaudited pro forma results presented below have been prepared to include the effect of the Chalker acquisition on our results of operations for the year ended December 31, 2012. The unaudited pro forma results do not purport to represent what our actual results of operations would have been if the acquisition had been completed on January 1, 2012 or to project our results of operations for any future date or period. | ||||||||
Year Ended | ||||||||
December 31, | ||||||||
2012 | ||||||||
(in thousands of dollars) | Pro Forma | |||||||
(unaudited) | ||||||||
Total operating revenue | $ | 194,685 | ||||||
Total operating expenses | 161,053 | |||||||
Operating income | 33,632 | |||||||
Net income | 25,713 | |||||||
Both acquisitions qualified as a business combination under ASC 805. The valuation to determine the fair values were principally based on the discounted cash flows of the producing and undeveloped properties, including projected drilling and equipment costs, recoverable reserves, production streams, future prices and operating costs, and risk-adjusted discount rates reflective of the market at the time of acquisition. | ||||||||
Fair_Value_Measurement
Fair Value Measurement | 12 Months Ended | |||||||||||||
Dec. 31, 2014 | ||||||||||||||
Fair Value Measurement | ||||||||||||||
Fair Value Measurement | ||||||||||||||
4. Fair Value Measurement | ||||||||||||||
Fair Value of Financial Instruments | ||||||||||||||
The Company determines fair value amounts using available market information and appropriate valuation methodologies. Fair value is the price that would be received to sell an asset or would be paid to transfer a liability in an orderly transaction between market participants at the measurement date. Considerable judgment is required in interpreting market data to develop the estimates of fair value. The use of different market assumptions and/or estimation methods may have a material effect on the estimated fair value amounts. | ||||||||||||||
The Company enters into a variety of derivative financial instruments, which may include over-the-counter instruments, such as natural gas, crude oil, and natural gas liquid contracts. The Company utilizes valuation techniques that maximize the use of observable inputs, where available. If listed market prices or quotes are not published, fair value is determined based upon a market quote, adjusted by other market-based or independently sourced market data, such as trading volume, historical commodity volatility, and counterparty-specific considerations. These adjustments may include amounts to reflect counterparty credit quality, the time value of money, and the liquidity of the market. | ||||||||||||||
Counterparty credit valuation adjustments are necessary when the market price of an instrument is not indicative of the fair value as a result of the credit quality of the counterparty. Generally, market quotes assume that all counterparties have low default rates and equal credit quality. Therefore, an adjustment may be necessary to reflect the quality of a specific counterparty to determine the fair value of the instrument. The Company currently has all derivative positions placed and held by members of its lending group, which have strong credit quality. | ||||||||||||||
Liquidity valuation adjustments are necessary when the Company is not able to observe a recent market price for financial instruments that trade in less active markets. Exchange traded contracts are valued at market value without making any additional valuation adjustments; therefore, no liquidity reserve is applied. | ||||||||||||||
Valuation Hierarchy | ||||||||||||||
Fair value measurements are grouped into a three-level valuation hierarchy. The valuation hierarchy is based upon the transparency of inputs to the valuation of an asset or liability as of the measurement date. A financial instrument's categorization within the hierarchy is based upon the input that requires the highest degree of judgment in the determination of the instrument's fair value. The three levels are defined as follows: | ||||||||||||||
Level 1 | Pricing inputs are based on published prices in active markets for identical assets or liabilities as of the reporting date. The Company does not classify any of its financial instruments in Level 1. | |||||||||||||
Level 2 | Pricing inputs include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the asset or liability, either directly or indirectly, as of the reporting date. Contracts that are not traded on a recognized exchange or are tied to pricing transactions for which forward curve pricing is readily available are classified as Level 2 instruments. These include natural gas, crude oil and some natural gas liquids price swaps and natural gas basis swaps. | |||||||||||||
Level 3 | Pricing inputs include significant inputs that are generally unobservable from objective sources. The Company classifies natural gas liquid swaps and basis swaps for which future pricing is not readily available as Level 3. The Company obtains estimates from independent third parties for its open positions and subjects those to the credit adjustment criteria described above. | |||||||||||||
The financial instruments carried at fair value as of December 31, 2014 and 2013, by consolidated balance sheet caption and by valuation hierarchy, as described above are as follows: | ||||||||||||||
December 31, 2014 | ||||||||||||||
Fair Value Measurements Using | ||||||||||||||
(in thousands of dollars) | (Level 1) | (Level 2) | (Level 3) | Total | ||||||||||
Commodity Price Hedges | ||||||||||||||
Current assets | $ | — | $ | 120,604 | $ | 915 | $ | 121,519 | ||||||
Long-term assets | — | 85,162 | 1,893 | 87,055 | ||||||||||
Current liabilities | — | — | — | — | ||||||||||
Long-term liabilities | — | — | 28 | 28 | ||||||||||
December 31, 2013 | ||||||||||||||
Fair Value Measurements Using | ||||||||||||||
(in thousands of dollars) | (Level 1) | (Level 2) | (Level 3) | Total | ||||||||||
Commodity Price Hedges | ||||||||||||||
Current assets | $ | — | $ | 8,837 | $ | — | $ | 8,837 | ||||||
Long-term assets | — | 25,967 | (569 | ) | 25,398 | |||||||||
Current liabilities | — | 10,188 | 476 | 10,664 | ||||||||||
Long-term liabilities | — | — | 190 | 190 | ||||||||||
The following table represents quantitative information about Level 3 inputs used in the fair value measurement of the Company's commodity derivative contracts as of December 31, 2014. | ||||||||||||||
Quantitative Information About Level 3 Fair Value Measurements | ||||||||||||||
Commodity Price Hedges | Fair Value | Valuation Technique | Unobservable | Range | ||||||||||
(000's) | Input | |||||||||||||
Natural gas liquid swaps | $ | 3,045 | Use a discounted cash flow approach using inputs including forward price statements from counterparties | Natural gas liquid futures | $8.09 - $75.52 per barrel | |||||||||
Natural gas basis swaps | $ | (265 | ) | Use a discounted cash flow approach using inputs including forward price statements from counterparties | Natural gas basis swaps | $(0.11) - $(0.17) per barrel | ||||||||
Significant increases/decreases in natural gas liquid prices in isolation would result in a significantly lower/higher fair value measurement. The following table presents the changes in the Level 3 financial instruments for the years ended December 31, 2014 and 2013. Changes in fair value of Level 3 instruments represent changes in gains and losses for the periods that are reported in other income (expense). New contracts entered into during the year are generally entered into at no cost with changes in fair value from the date of agreement representing the entire fair value of the instrument. Transfers between levels are evaluated at the end of the reporting period. | ||||||||||||||
(in thousands of dollars) | ||||||||||||||
Balance at December 31, 2012, net | $ | (1,519 | ) | |||||||||||
Purchases | (1,095 | ) | ||||||||||||
Settlements | (210 | ) | ||||||||||||
Transfers to Level 2 | (753 | ) | ||||||||||||
Changes in fair value | 2,342 | |||||||||||||
| | | | | ||||||||||
Balance at December 31, 2013, net | (1,235 | ) | ||||||||||||
Purchases | 668 | |||||||||||||
Settlements | 476 | |||||||||||||
Transfers into Level 3 | (265 | ) | ||||||||||||
Transfers to Level 2 | 332 | |||||||||||||
Changes in fair value | 2,804 | |||||||||||||
| | | | | ||||||||||
Balance at December 31, 2014, net | $ | 2,780 | ||||||||||||
| | | | | ||||||||||
| | | | | ||||||||||
Transfers from Level 3 to Level 2 represent the Company's natural gas basis swaps for which observable forward curve pricing information has become readily available. Purchases represent natural gas liquid swaps that the Company entered into that do not have observable forward curve pricing information. There were no transfers into Level 3 for the years ended December 31, 2014 and 2013. | ||||||||||||||
Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis | ||||||||||||||
The following table provides the fair value of financial instruments that are not recorded at fair value in the consolidated financial statements: | ||||||||||||||
December 31, 2014 | December 31, 2013 | |||||||||||||
(in thousands of dollars) | Carrying | Fair Value | Carrying | Fair Value | ||||||||||
Amount | Amount | |||||||||||||
Debt: | ||||||||||||||
Revolver | $ | 360,000 | $ | 360,000 | $ | 498,000 | $ | 498,000 | ||||||
Term loan | — | — | 160,000 | 160,000 | ||||||||||
2022 Notes | 500,000 | 384,375 | — | — | ||||||||||
The Revolver is categorized as Level 3 in the valuation hierarchy as the debt is not publicly traded and no observable market exists to determine the fair value; however, the carrying value of the Revolver approximates fair value, as it is subject to short-term floating interest rates that approximate the rates available to the Company for those periods. | ||||||||||||||
The fair value of the 2022 Notes (as defined in Note 6) is based on pricing that is readily available in the public market. Accordingly, the 2022 Notes are classified as Level 2 in the valuation hierarchy as the pricing is based on quoted market prices for the debt securities. | ||||||||||||||
Assets and liabilities acquired in business combinations are recorded at their fair value on the date of acquisition. Significant Level 3 assumptions associated with the calculation of future cash flows used in the analysis of fair value of the oil and gas property acquired include the Company's estimate of future commodity prices, production costs, development expenditures, production, risk-adjusted discount rates, and other relevant data. Additionally, fair value is used to determine the inception value of the Company's AROs. The inputs used to determine such fair value are primarily based upon costs incurred historically for similar work, as well as estimates from independent third parties for costs that would be incurred to restore leased property to the contractually stipulated condition. Additions to the Company's ARO represent a nonrecurring Level 3 measurement. | ||||||||||||||
The Company reviews its proved oil and gas properties for impairment purposes by comparing the expected undiscounted future cash flows at a producing field level to the unamortized capitalized cost of the asset. No impairment charges on the Company's proved properties were recorded during the years ended December 31, 2014 and 2013. During 2012, unamortized capitalized costs of certain properties were higher than their expected undiscounted future cash flows due primarily to downward reserve revisions, drilling of marginal or uneconomic wells, or development dry holes in certain producing fields. As a result, the Company recorded charges of $18.8 million during the year ended December 31, 2012. | ||||||||||||||
Additionally, the Company reviews its unproved properties for indicators of impairment based on the Company's current exploration plans. In the fourth quarter of 2013, the Company recorded an impairment charge of $14.4 million related to the Southridge properties. As the Company did not drill the required number of wells by October 31, 2013 necessary to keep its joint development agreement with Southridge in effect, the Company lost its right to the undeveloped acreage and associated reserves. The Company incurred no impairment charges related to its unproved properties in 2014 or 2012. | ||||||||||||||
Impairment charges are recorded on the Consolidated Statement of Operations. Significant assumptions associated with the calculation of future cash flows used in the impairment analysis include the Company's estimate of future commodity prices, production costs, development expenditures, production, risk-adjusted discount rates, and other relevant data. As such, the fair value of oil and gas properties used in estimating impairment represents a nonrecurring Level 3 measurement. | ||||||||||||||
Derivative_Instruments_and_Hed
Derivative Instruments and Hedging Activities | 12 Months Ended | ||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||
Derivative Instruments and Hedging Activities | |||||||||||||||||
Derivative Instruments and Hedging Activities | |||||||||||||||||
5. Derivative Instruments and Hedging Activities | |||||||||||||||||
The Company had various commodity derivatives in place that could affect its future operations as of December 31, 2014 and 2013, as follows: | |||||||||||||||||
Hedging Positions | |||||||||||||||||
December 31, 2014 | |||||||||||||||||
Low | High | Weighted | Final | ||||||||||||||
Average | Expiration | ||||||||||||||||
Oil swaps | Exercise price | $ | 75.05 | $ | 100.95 | $ | 84.2 | ||||||||||
Barrels per month | 45,000 | 184,054 | 113,852 | Dec-18 | |||||||||||||
Natural gas swaps | Exercise price | $ | 3.37 | $ | 6.45 | $ | 4.4 | ||||||||||
mmbtu per month | 710,000 | 1,772,584 | 1,175,275 | Dec-18 | |||||||||||||
Basis swaps | Contract differential | $ | (0.39 | ) | $ | (0.11 | ) | $ | (0.21 | ) | |||||||
mmbtu per month | 320,000 | 980,000 | 716,667 | Mar-16 | |||||||||||||
Natural gas liquids swaps | Exercise price | $ | 8.09 | $ | 95.24 | $ | 42.46 | ||||||||||
Barrels per month | 2,000 | 143,000 | 50,444 | Dec-17 | |||||||||||||
December 31, 2013 | |||||||||||||||||
Low | High | Weighted | Final | ||||||||||||||
Average | Expiration | ||||||||||||||||
Oil swaps | Exercise price | $ | 81.7 | $ | 102.84 | $ | 89.03 | ||||||||||
Barrels per month | 29,000 | 161,613 | 96,149 | Dec-17 | |||||||||||||
Natural gas swaps | Exercise price | $ | 3.88 | $ | 6.9 | $ | 4.26 | ||||||||||
mmbtu per month | 510,000 | 1,290,000 | 830,275 | Dec-17 | |||||||||||||
Basis swaps | Contract differential | $ | (0.43 | ) | $ | (0.11 | ) | $ | (0.34 | ) | |||||||
mmbtu per month | 320,000 | 690,000 | 467,037 | Mar-16 | |||||||||||||
Natural gas liquids swaps | Exercise price | $ | 6.72 | $ | 95.24 | $ | 32.98 | ||||||||||
Barrels per month | 2,000 | 118,000 | 46,646 | Dec-17 | |||||||||||||
The Company recognized a net gain on derivative instruments of $189.6 million for the year ended December 31, 2014, a net loss of $2.6 million for the year ended December 31, 2013, and a net gain of $16.7 million for the year ended December 31, 2012. | |||||||||||||||||
Offsetting Assets and Liabilities | |||||||||||||||||
As of December 31, 2014, the counterparties to our commodity derivative contracts consisted of seven financial institutions. Substantially, all of our counterparties or their affiliates are also lenders under the Revolver. We are not generally required to post additional collateral under our derivative agreements. | |||||||||||||||||
Our derivative agreements contain set-off provisions that state that in the event of default or early termination, any obligation owed by the defaulting party may be offset against any obligation owed to the defaulting party. | |||||||||||||||||
We adopted the guidance requiring disclosure of both gross and net information about financial instruments eligible for netting in the balance sheet under our derivative agreements. The following table presents information about our commodity derivative contracts that are netted on our Consolidated Balance Sheet as of December 31, 2014 and December 31, 2013: | |||||||||||||||||
(in thousands of dollars) | Gross Amounts | Gross | Net Amounts | Gross | Net Amount | ||||||||||||
of Recognized | Amounts | of Assets / | Amounts | ||||||||||||||
Assets / | Offset in the | Liabilities | Not | ||||||||||||||
Liabilities | Balance | Presented in | Offset in the | ||||||||||||||
Sheet | the Balance | Balance | |||||||||||||||
Sheet | Sheet | ||||||||||||||||
December 31, 2014 | |||||||||||||||||
Commodity derivative contracts | |||||||||||||||||
Assets | $ | 208,646 | $ | (72 | ) | $ | 208,574 | $ | — | $ | 208,574 | ||||||
Liabilities | (100 | ) | 72 | (28 | ) | — | (28 | ) | |||||||||
December 31, 2013 | |||||||||||||||||
Commodity derivative contracts | |||||||||||||||||
Assets | $ | 38,071 | $ | (6,035 | ) | $ | 32,036 | $ | 2,199 | $ | 34,235 | ||||||
Liabilities | (14,347 | ) | 6,035 | (8,312 | ) | (2,542 | ) | (10,854 | ) | ||||||||
LongTerm_Debt
Long-Term Debt | 12 Months Ended |
Dec. 31, 2014 | |
Long-Term Debt | |
Long-Term Debt | |
6. Long-Term Debt | |
Senior Notes | |
On April 1, 2014, JEH and its wholly-owned subsidiary, Jones Energy Finance Corp. (together the "Issuers"), sold $500.0 million in aggregate principal amount of the Issuers' 6.75% Senior Notes due 2022 (the "2022 Notes"). The Company used the net proceeds from the issuance of the 2022 Notes to repay all outstanding borrowings under the Term Loan ($160.0 million), a portion of the outstanding borrowings under the Revolver ($308.0 million) and for working capital and general corporate purposes. The Company subsequently terminated the Term Loan in accordance with its terms. The 2022 Notes bear interest at a rate of 6.75% per year, payable semi-annually on April 1 and October 1 of each year beginning October 1, 2014. As of December 31, 2014, the Company had $8.4 million in interest accrued related to the 2022 Notes. Total interest expense related to the 2022 Notes amounted to $25.3 million for the year ended December 31, 2014. | |
The 2022 Notes are guaranteed on a senior unsecured basis by the Company and by all of its significant subsidiaries. The 2022 Notes will be senior in right of payment to any future subordinated indebtedness of the Issuers. | |
The Company may redeem the 2022 Notes at any time on or after April 1, 2017 at a declining redemption price set forth in the indenture, plus accrued and unpaid interest. | |
The indenture governing the 2022 Notes contains covenants that, among other things, limit the ability of the Company to incur additional indebtedness or issue certain preferred stock, pay dividends on capital stock, transfer or sell assets, make investments, create certain liens, enter into agreements that restrict dividends or other payments from the Company's restricted subsidiaries to the Company, consolidate, merge or transfer all of the Company's assets, engage in transactions with affiliates or create unrestricted subsidiaries. However, many of these covenants will be suspended if the Notes are rated investment grade by Standard & Poor's or Moody's. | |
Other Long-Term Debt | |
The Company entered into two credit agreements dated December 31, 2009, with Wells Fargo Bank N.A, the Senior Secured Revolving Credit Facility (the "Revolver") and the Second Lien Term Loan (the "Term Loan"), each of which have been amended periodically. On April 1, 2014, the Term Loan was repaid in full and terminated in connection with the issuance of the 2022 Notes. On November 6, 2014, the Company amended the Revolver to, among other things, increase the borrowing base under the Revolver from $550.0 million to $625.0 million until the next redetermination thereof, and extend the maturity date of the Revolver to November 6, 2019. The Company's oil and gas properties are pledged as collateral to secure its obligations under the Revolver. The borrowing base on the Revolver was subsequently adjusted to $562.5 million in accordance with its terms as a result of the issuance of the 2023 Notes in February 2015. | |
The terms of the Revolver require the Company to make periodic payments of interest on the loans outstanding thereunder, with all outstanding principal and interest under the Revolver due on the maturity date thereof. The Revolver is subject to a borrowing base which limits the amount of borrowings which may be drawn thereunder. The borrowing base will be redetermined by the lenders at least semi-annually on or about April 1 and October 1 of each year. Interest on the Revolver is calculated, at the Company's option, at either (a) the LIBO rate for the applicable interest period plus a margin of 1.50% to 2.50% based on the level of borrowing base utilization at such time or (b) the greatest of the federal funds rate plus 0.50%, the one-month adjusted LIBO rate plus 1.00%, or the prime rate announced by Wells Fargo Bank, N.A. in effect on such day, in each case plus a margin of 0.50% to 1.50% based on the level of borrowing base utilization at such time. For the year ended December 31, 2014, the average interest rate under the Revolver was 2.51% on an average outstanding balance of $333.8 million. For the year ended December 31, 2013, the average interest rate under the Revolver was 3.01% on an average outstanding balance of $384.9 million. | |
Total interest and commitment fees under the Revolver and Term Loan were $13.0 million, $27.0 million, and $21.2 million for the years ended December 31, 2014, 2013 and 2012, respectively. $3.8 million in unamortized deferred financing costs were charged to interest expense during 2014 in connection with repayment of the Term Loan. | |
The Revolver is categorized as Level 3 in the valuation hierarchy as the debt is not publicly traded and no observable market exists to determine the fair value; however, the carrying value approximates fair value, as it is subject to short-term floating interest rates that approximate the rates available to the Company for those periods. | |
We are subject to certain covenants under the Revolver which include, but are not limited to, restrictions on asset sales, distributions to members, and incurrence of additional indebtedness, and financial covenants which require the maintenance of certain financial ratios, including a maximum leverage ratio, and a minimum current ratio. The Company was in compliance with these covenants at December 31, 2014. | |
Stockbased_Compensation
Stock-based Compensation | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Stock-based Compensation | ||||||||
Stock-based Compensation | ||||||||
7. Stock-based Compensation | ||||||||
Management Units | ||||||||
Prior to the IPO, JEH granted management units under a previously existing management incentive plan. These awards had various vesting schedules, and a portion of the management units vested in a lump sum at the IPO date. Both the vested and unvested management units were converted into JEH Units and shares of Class B common stock at the IPO date. As of December 31, 2014, there were 274,385 unvested JEH Units and shares of Class B common stock under this plan. No new JEH Units and Class B shares are created upon a vesting event. The JEH Units (together with a corresponding number of shares of Class B common stock) will become exchangeable into a like number of shares of Class A common stock upon vesting or forfeiture. The following table summarizes information related to the vesting of JEH Units: | ||||||||
JEH Units | Weighted Average | |||||||
Grant Date Fair | ||||||||
Value | ||||||||
per Share | ||||||||
Unvested at January 1, 2013 | 710,767 | $ | 3.62 | |||||
Granted | 911,654 | $ | 15 | |||||
Forfeited | (167,239 | ) | $ | 3.62 | ||||
Vested | (998,032 | ) | $ | 9.96 | ||||
| | | | | | | | |
Unvested at December 31, 2013 | 457,150 | $ | 12.46 | |||||
Granted | 21,405 | $ | 6.66 | |||||
Forfeited | (21,405 | ) | $ | 6.66 | ||||
Vested | (182,765 | ) | $ | 8.65 | ||||
| | | | | | | | |
Unvested at December 31, 2014 | 274,385 | $ | 15 | |||||
| | | | | | | | |
| | | | | | | | |
Stock compensation expense associated with the management units and JEH Units for the years ended December 31, 2014, 2013 and 2012 was $1.6 million, $10.7 million, and $0.6 million, respectively, and is included in general and administrative expenses on the Company's Consolidated Statement of Operations. | ||||||||
Restricted Stock Awards | ||||||||
On September 23, 2014, the Company granted restricted stock awards to non-employee members of the Board of Directors. Each of the five directors was awarded 5,486 restricted shares of Class A common stock, contingent on the director serving as a director of the Company for a one-year service period in accordance with the terms of the award. The fair value of the awards was based on the value of the Company's Class A common stock on the date of grant. | ||||||||
On September 4, 2013, the Company granted restricted stock awards to non-employee members of the Board of Directors. Each of the four directors was awarded 6,645 restricted shares of Class A common stock, contingent on the director serving as a director of the Company for a one-year service period from the date of grant. The fair value of the awards was based on the value of the Company's Class A common stock on the date of grant. These awards are fully vested as of December 31, 2014. The total number of shares awarded to the directors is as follows: | ||||||||
Director Restricted Stock Awards | ||||||||
Restricted | Weighted Average | |||||||
Stock Awards | Grant Date Fair | |||||||
Value per Share | ||||||||
Unvested at January 1, 2013 | — | — | ||||||
Granted | 26,580 | $ | 15.05 | |||||
Forfeited | — | — | ||||||
Vested | — | — | ||||||
| | | | | | | | |
Unvested at December 31, 2013 | 26,580 | $ | 15.05 | |||||
Granted | 27,430 | $ | 18.77 | |||||
Forfeited | — | — | ||||||
Vested | (26,580 | ) | $ | 15.05 | ||||
| | | | | | | | |
Unvested at December 31, 2014 | 27,430 | $ | 18.77 | |||||
| | | | | | | | |
| | | | | | | | |
Stock compensation expense associated with the Board of Directors awards for the year ended December 31, 2014 was $0.4 million and for the year ended December 31, 2013 was $0.1 million and is included in general and administrative expenses on the Company's Consolidated Statement of Operations. | ||||||||
Restricted Stock Unit Awards | ||||||||
During the year ended December 31, 2014, the Company granted 340,001 restricted stock unit awards to certain officers and employees of the Company. The fair value of the restricted stock unit awards was based on the value of the Company's Class A common stock on the date of grant and is expensed on a straight-line basis over the applicable three-year vesting period. The total number of units awarded to the officers and employees is as follows: | ||||||||
Employee Restricted Stock Unit Awards | ||||||||
Restricted | Weighted Average | |||||||
Stock Unit | Grant Date Fair | |||||||
Awards | Value per Share | |||||||
Unvested at January 1, 2014 | — | — | ||||||
Granted | 340,001 | $ | 17.31 | |||||
Forfeited | (13,688 | ) | $ | 17.07 | ||||
Vested | (1,416 | ) | $ | 17.07 | ||||
| | | | | | | | |
Unvested at December 31, 2014 | 324,897 | $ | 17.33 | |||||
| | | | | | | | |
| | | | | | | | |
Stock compensation expense associated with the employee restricted stock unit awards for the twelve months ended December 31, 2014 was $1.1 million, and is included in general and administrative expenses on the Company's Consolidated Statement of Operations. | ||||||||
Performance Unit Awards | ||||||||
During the twelve months ended December 31, 2014, the Company granted 201,318 performance unit awards to certain officers of the Company. Upon the completion of the applicable three-year performance period, each officer will vest in a number of performance units. The number of performance units in which each officer vests at such time will range from 0% to 200% based on the Company's total shareholder return relative to an industry peer group over the applicable three-year performance period. Each vested performance unit is exchangeable for one share of the Company's Class A common stock. The grant date fair value of the performance units was determined using a Monte Carlo simulation model, which results in an expected percentage of performance units earned. The fair value of the performance units is expensed on a straight-line basis over the applicable three-year performance period. | ||||||||
The total number of units awarded to the officers is as follows: | ||||||||
Employee Performance Unit Awards | ||||||||
Performance | Weighted Average | |||||||
Unit Awards | Grant Date Fair | |||||||
Value per Share | ||||||||
Unvested at January 1, 2014 | — | — | ||||||
Granted | 201,318 | $ | 21.65 | |||||
Forfeited | (8,320 | ) | $ | 21.65 | ||||
Vested | — | — | ||||||
| | | | | | | | |
Unvested at December 31, 2014 | 192,998 | $ | 21.65 | |||||
| | | | | | | | |
| | | | | | | | |
Stock compensation expense associated with the performance unit awards for the twelve months ended December 31, 2014 was $0.9 million, and is included in general and administrative expenses on the Company's Consolidated Statement of Operations. | ||||||||
The Monte Carlo simulation process is a generally accepted statistical technique used, in this instance, to simulate future stock prices for the Company and the components of the peer group. The simulation uses a risk-neutral framework along with the risk-free rate of return, the volatility of each entity, and the correlations of each entity with the other entities in the peer group. A stock price path has been simulated for the Company and each peer company and is used to determine the payout percentages and the stock price of the Company's common stock as of the vesting date. The ending stock price is multiplied by the payout percentage to determine the projected payout, which is then discounted with the risk-free rate of return to the grant date to determine the grant date fair value for that simulation. When enough simulations are generated, the resulting distribution gives a reasonable estimate of the range of future expected stock prices. | ||||||||
The following assumptions were used for the Monte Carlo simulation model to determine the grant date fair value and associated compensation expense during the twelve months ended December 31, 2014: | ||||||||
Stock Price(1) | $ | 17.07 | ||||||
Beginning Average Stock Price(2) | $ | 14.78 | ||||||
Expected Volatility(3) | 46.95 | % | ||||||
Risk-Free Rate of Return(4) | 0.61 | % | ||||||
-1 | Based on the closing price of Jones Energy, Inc. Class A common stock on May 20, 2014. | |||||||
-2 | Based on the 10 trading days immediately prior to the beginning of the performance period. | |||||||
-3 | Based on the average historical volatilities over the most recent 2.62-year period for the Company and each peer company using daily stock prices through May 20, 2014. The measurement period reflects the 2.62 years remaining in the performance period as of the grant date. | |||||||
-4 | Based on the yield curve of U.S. Treasury rates as of May 20, 2014. | |||||||
Based on these assumptions, the Monte Carlo simulation model resulted in a simulated fair value of $21.65 based on an expected percentage of performance units earned of 126.80%. | ||||||||
Earnings_per_Share
Earnings per Share | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Earnings per Share | ||||||||
Earnings per Share | ||||||||
8. Earnings per Share | ||||||||
Basic earnings per share ("EPS") is computed by dividing net income (loss) attributable to controlling interests by the weighted-average number of shares of Class A common stock outstanding during the period. Shares of Class B common stock are not included in the calculation of earnings per share because they are not participating securities and have no economic interest in the Company. Diluted earnings per share takes into account the potential dilutive effect of shares that could be issued by the Company in conjunction with stock awards that have been granted to directors and employees. In accordance with ASC 260, Earnings Per Share, awards of nonvested shares shall be considered outstanding as of the respective grant dates for purposes of computing diluted EPS even though the award is contingent upon vesting. For the twelve months ended December 31, 2014, 27,430 restricted stock shares, 54,656 restricted stock units and 192,998 performance units were excluded from the calculation as they would have had an anti-dilutive effect. The following is a calculation of the basic and diluted weighted-average number of shares of Class A common stock outstanding and EPS. 2014 is calculated using the twelve months ended December 31, 2014. 2013 is calculated for the period from July 29, 2013, the closing date of the IPO, to December 31, 2013. | ||||||||
Basic Earnings per Share | ||||||||
(in thousands, except per share data) | 2014 | 2013 | ||||||
Income (numerator): | ||||||||
Net income (loss) attributable to controlling interests | $ | 40,868 | $ | (2,186 | ) | |||
Weighted-average shares (denominator): | ||||||||
Weighted-average number of shares of Class A common stock | 12,526 | 12,500 | ||||||
| | | | | | | | |
Earnings (loss) per share: | ||||||||
Basic earnings per share | $ | 3.26 | $ | (0.17 | ) | |||
| | | | | | | | |
| | | | | | | | |
Diluted Earnings per Share | ||||||||
(in thousands, except per share data) | 2014 | 2013 | ||||||
Income (numerator): | ||||||||
Net income (loss) attributable to controlling interests | $ | 40,868 | $ | (2,186 | ) | |||
Weighted-average shares (denominator): | ||||||||
Weighted-average number of shares of Class A common stock | 12,535 | 12,500 | ||||||
| | | | | | | | |
Earnings (loss) per share: | ||||||||
Diluted earnings per share | $ | 3.26 | $ | (0.17 | ) | |||
| | | | | | | | |
| | | | | | | | |
Anti-dilutive shares of Class A common stock | 275 | 27 | ||||||
Monarch_Investment
Monarch Investment | 12 Months Ended |
Dec. 31, 2014 | |
Monarch Investment | |
Monarch Investment | |
9. Monarch Investment | |
On May 7, 2013, the Company entered into a marketing agreement with Monarch, a company related through common ownership, for the sale to Monarch of natural gas produced from certain properties. In connection with that agreement, Monarch issued to the Company equity interests in its parent, Monarch Natural Gas Holdings, LLC, having an estimated fair value of $15.0 million. Contemporaneous with the execution of the marketing agreement and the issuance of the equity interests, the Company distributed 67%, or $10 million, of the Monarch equity interests to the Company's owners pro rata based on equity contributions and approximately 16% of the interests to a member of management. The remaining approximately 17% of the equity interests were reserved for distribution to management through an incentive plan. During the year ended December 31, 2014, $0.5 million of the equity interests were distributed to management under the incentive plan. The Company recognized expense of $0.8 million during the year ended December 31, 2014 and $0.3 million during the year ended December 31, 2013 in connection with the incentive plan. In addition, the Company recorded deferred revenue of $15.0 million related to the marketing agreement which is being amortized on an estimated units-of-production basis commencing in September 2013, the first month of production sales to Monarch. The Company amortized $1.2 million of the deferred revenue balance during the year ended December 31, 2014, and $0.5 million of deferred revenue during the year ended December 31, 2013. This revenue is recorded in other revenues on the Company's Consolidated Statement of Operations. | |
Commitments_and_Contingencies
Commitments and Contingencies | 12 Months Ended | ||||
Dec. 31, 2014 | |||||
Commitments and Contingencies | |||||
Commitments and Contingencies | |||||
10. Commitments and Contingencies | |||||
Lease obligations | |||||
The Company leases approximately 43,000 square feet of office space in Austin, TX under an operating lease arrangement. Future minimum payments for all noncancellable operating leases extending beyond one year at December 31, 2014 are as follows: | |||||
(in thousands of dollars) | |||||
Years Ending December 31, | |||||
2015 | $ | 944 | |||
2016 | 954 | ||||
2017 | 1,038 | ||||
2018 | 1,101 | ||||
2019 | 1,122 | ||||
Thereafter | 377 | ||||
| | | | | |
$ | 5,536 | ||||
| | | | | |
| | | | | |
Rent expense under operating leases was $0.9 million, $0.8 million and $0.8 million for the years ended December 31, 2014, 2013 and 2012, respectively. | |||||
Litigation | |||||
The Company is subject to legal proceedings and claims that arise in the ordinary course of its business. The Company believes that the final disposition of such current matters will not have a material adverse effect on its financial position, results of operations, or liquidity. | |||||
Benefit_Plans
Benefit Plans | 12 Months Ended |
Dec. 31, 2014 | |
Benefit Plans | |
Benefit Plans | |
11. Benefit Plans | |
The Company established a 401(k) tax-deferred savings plan (the "Plan") for the benefit of employees. The Plan is a defined contribution plan and the Company may match a portion of employee contributions. For each of the years ended December 31, 2014 and 2013, $0.3 million was contributed to the Plan. | |
In 2013, the Company established a 409A tax-deferred savings plan for the benefit of key employees. This plan is a defined contribution plan, and the Company may match a portion of employee contributions. For each of the years ended December 31, 2014 and 2013, the Company made no contributions to this plan. | |
Income_Taxes
Income Taxes | 12 Months Ended | ||||||||||
Dec. 31, 2014 | |||||||||||
Income Taxes | |||||||||||
Income Taxes | |||||||||||
12. Income Taxes | |||||||||||
Following its IPO, the Company began recording a federal and state income tax liability associated with its status as a corporation. Prior to the IPO, the Company only recorded a provision for Texas franchise tax as the Company's taxable income or loss was includable in the income tax returns of the individual partners and members. | |||||||||||
The Company will recognize a tax liability on its share of pre-tax book income, exclusive of the non-controlling interest. JEH is not subject to income tax at the federal level and only recognizes Texas franchise tax expense. The following table summarizes the tax provision for the years ended December 31, 2014, 2013 and 2012: | |||||||||||
Year Ended December 31, | |||||||||||
(in thousands of dollars) | 2014 | 2013 | 2012 | ||||||||
Current tax expense: | |||||||||||
Federal | $ | 53 | $ | 85 | $ | — | |||||
State | — | — | — | ||||||||
| | | | | | | | | | | |
Total current expense | 53 | 85 | — | ||||||||
| | | | | | | | | | | |
Deferred tax expense (benefit): | |||||||||||
Federal | 21,996 | (1,260 | ) | — | |||||||
State | 4,025 | 1,104 | 473 | ||||||||
| | | | | | | | | | | |
Total deferred expense (benefit) | 26,021 | (156 | ) | 473 | |||||||
| | | | | | | | | | | |
Total tax expense (benefit) | $ | 26,074 | $ | (71 | ) | $ | 473 | ||||
| | | | | | | | | | | |
| | | | | | | | | | | |
Tax expense (benefit) attributable to controlling interests | $ | 22,675 | $ | (1,223 | ) | $ | 473 | ||||
Tax expense attributable to non-controlling interests | 3,399 | 1,152 | — | ||||||||
| | | | | | | | | | | |
Total income tax expense (benefit) | $ | 26,074 | $ | (71 | ) | $ | 473 | ||||
| | | | | | | | | | | |
| | | | | | | | | | | |
For the pre-IPO period of the year ended December 31, 2013 and for the entire year ended December 31, 2012, the reported taxes in the table above relate solely to the Texas franchise tax liability of JEH. | |||||||||||
A reconciliation of the Company's provision for income taxes as reported and the amount computed by multiplying income before taxes, less non-controlling interest, by the U.S. federal statutory rate of 35%: | |||||||||||
(in thousands of dollars) | 2014 | 2013 | |||||||||
Provision calculated at federal statutory income tax rate: | |||||||||||
Net income before taxes | $ | 250,217 | $ | 22,334 | |||||||
Statutory rate | 35 | % | 35 | % | |||||||
| | | | | | | | ||||
Income tax expense computed at statutory rate | $ | 87,577 | $ | 7,817 | |||||||
Less: Non-controlling interests | (65,336 | ) | (9,009 | ) | |||||||
| | | | | | | | ||||
Income tax expense (benefit) attributable to controlling interests | 22,241 | (1,192 | ) | ||||||||
State and local income taxes, net of federal benefit | 626 | (49 | ) | ||||||||
Other | (192 | ) | 18 | ||||||||
| | | | | | | | ||||
Tax expense (benefit) attributable to controlling interests | 22,675 | (1,223 | ) | ||||||||
Tax expense attributable to non-controlling interests | 3,399 | 1,152 | |||||||||
| | | | | | | | ||||
Total income tax expense (benefit) | $ | 26,074 | $ | (71 | ) | ||||||
| | | | | | | | ||||
| | | | | | | | ||||
For the year ended December 31, 2012, the calculation is not applicable as the Company was not subject to federal income taxes prior to the IPO. | |||||||||||
The Company is subject to federal, state, and local income and franchise taxes. As such, deferred income taxes result from temporary differences between the carrying amounts of assets and liabilities of the Company for financial reporting purposes and the amounts used for income tax purposes. Deferred tax assets and liabilities are measured using enacted tax rates in effect in the years in which those temporary differences are expected to reverse. | |||||||||||
Significant components of the Company's deferred tax assets and deferred tax liabilities consisted of the following: | |||||||||||
As of December 31, | |||||||||||
(in thousands of dollars) | 2014 | 2013 | |||||||||
Deferred tax assets | |||||||||||
Investment in consolidated subsidiary JEH | $ | — | $ | 526 | |||||||
Net operating loss | 8,223 | 649 | |||||||||
Section 754 election tax basis adjustment | 945 | — | |||||||||
Alternative minimum tax credits | 53 | 86 | |||||||||
Other deferred tax asset | 232 | 52 | |||||||||
| | | | | | | | ||||
Total deferred tax assets | 9,453 | 1,313 | |||||||||
| | | | | | | | ||||
Deferred tax liabilities | |||||||||||
Current state deferred tax liability | 718 | — | |||||||||
Investment in consolidated subsidiary JEH | 29,163 | — | |||||||||
Noncurrent state deferred tax liability | 6,731 | 3,093 | |||||||||
| | | | | | | | ||||
Total deferred tax liabilities | 36,612 | 3,093 | |||||||||
| | | | | | | | ||||
Net deferred tax assets (liabilities) | (27,159 | ) | (1,780 | ) | |||||||
Valuation allowance | — | — | |||||||||
| | | | | | | | ||||
Net deferred tax assets (liabilities) | $ | (27,159 | ) | $ | (1,780 | ) | |||||
| | | | | | | | ||||
| | | | | | | | ||||
The Company has a federal net operating loss carry-forward totaling $22.4 million and state net operating loss carry-forward of $9.6 million, both of which expire between 2033 and 2034. No valuation allowance has been recorded as management believes that there is sufficient future taxable income to fully utilize its deferred tax assets. This future taxable income will arise from reversing temporary differences due to the excess of the book carrying value of oil and gas properties over their corresponding tax basis. In addition, the Company may elect to capitalize intangible drilling costs, rather than expensing these costs, in order to prevent an operating loss carryforward from expiring unused. | |||||||||||
Separate federal and state income tax returns are filed for Jones Energy, Inc. and Jones Energy Holdings, LLC. JEH's Texas franchise tax returns are subject to audit for 2010 through 2014. The tax years 2011 through 2014 remain open to examination by the major taxing jurisdictions to which the Company is subject. The Company is not currently under audit by the IRS or any state jurisdiction. | |||||||||||
Accounting for uncertainty in income taxes prescribes a recognition threshold and measurement methodology for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. As of December 31, 2014 and December 31, 2013 there was no material liability or expense for the periods then ended recorded for payments of interest and penalties associated with uncertain tax positions or material unrecognized tax positions and the Company's unrecognized tax benefits were not material. | |||||||||||
Tax Receivable Agreement | |||||||||||
JEH intends to make an election under Section 754 of the Internal Revenue Code (the "Code") effective for 2014 and future tax years. As a result, JEH will be required to adjust the tax basis of the assets of JEH at the time of an exchange of JEH units and Class B common stock held by the non-controlling interest members of the Company for Class A common stock. The tax basis adjustments are expected to result in increases in the tax basis of the assets of JEH that would otherwise have not been available. This increase in tax basis allows the Company to reduce the amount of future tax payments to the extent that the Company has future taxable income. | |||||||||||
As a result of the increase in tax basis generated in exchanges made as of December 31, 2014, the Company is entitled to future tax benefits of $0.9 million and has recorded this amount as a deferred tax asset on its consolidated balance sheet. Under the terms of the TRA entered into prior to the IPO, JEI will pay 85% of the amount of cash savings, if any, in U.S. federal, state and local income tax that the Company actually realizes as a result of these increases in tax basis to the exchanging member who generated the increased tax basis. For purposes of making payments under the TRA, actual cash savings in income tax in a given year will be computed by comparing the Company's actual income tax liability to the amount of such taxes the Company would have been required to pay had there been no increase to the tax basis of the assets of JEH as a result of the exchanges. | |||||||||||
While the actual amount and timing of payments under the TRA will depend upon a number of factors, including the amount and timing of taxable income generated in the future, changes in future tax rates, the value of individual assets, and the portion of the Company's payments under the TRA constituting imputed interest, the Company has estimated that the payments that will be made to the pre-IPO members who have exchanged shares as of December 31, 2014 will be $0.8 million and has recorded this obligation as a liability on the consolidated balance sheet. To the extent the Company does not realize all of the tax benefits in future years or in the event of a change in future tax rates, this liability may change. | |||||||||||
As of December 31, 2014, the Company has not made any payments under the TRA to pre-IPO members who have exchanged JEH units and Class B common stock for Class A common stock. The Company does not anticipate making a material payment under the TRA in 2015. | |||||||||||
Subsequent_Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2014 | |
Subsequent Events | |
Subsequent Events | |
13. Subsequent Events | |
Public Offering of Class A Common Stock | |
On February 17, 2015, the Company completed the issuance and sale of 7,500,000 shares of Class A common stock to the public at a price of $10.25 per share under the Company's registration statement on Form S-3 (the "Public Equity Offering"). The shares of Class A common stock were issued pursuant to an underwriting agreement, dated February 11, 2015, in which the Company granted the underwriters a 30-day option to purchase up to an additional 1,125,000 shares of Class A common stock. | |
Private Placement of Class A Common Stock | |
On February 23, 2015, the Company completed the sale of an aggregate of $50.0 million of its Class A common stock to certain affiliates of GSO Capital Partners LP and Magnetar Capital LLC in a direct placement of registered shares under the Company's registration statement on Form S-3 (the "Private Equity Offering"). Under the terms of the Private Equity Offering, the Company sold 4,761,905 shares of Class A common stock at a purchase price of $10.50 per share. | |
Private Placement of Senior Unsecured Notes | |
On February 23, 2015, JEH and Jones Energy Finance Corp., a wholly-owned subsidiary of JEH formed for the sole purpose of co-issuing certain of JEH's debt, completed the sale of $250.0 million in aggregate principal amount of 9.25% senior unsecured notes due 2023 (the "2023 Notes") to certain affiliates of GSO Capital Partners LP and Magnetar Capital LLC in a private placement (the "Notes Offering"). The 2023 Notes rank equally with all of the Company's other senior unsecured indebtedness and are effectively subordinated in right of payment to all of the Company's secured indebtedness (to the extent of the collateral securing such indebtedness). The 2023 Notes are fully and unconditionally guaranteed on a senior unsecured basis by the Company and by all of JEH's existing subsidiaries (other than the co-issuer and two immaterial subsidiaries) and any future subsidiaries that guarantee indebtedness under the Revolver or other debt securities. | |
The Company used the net proceeds from the Public Equity Offering, the Private Equity Offering and the Notes Offering for working capital and to repay outstanding borrowings under the Revolver. | |
Subsidiary_Guarantors
Subsidiary Guarantors | 12 Months Ended | |||||||||||||||||||
Dec. 31, 2014 | ||||||||||||||||||||
Subsidiary Guarantors | ||||||||||||||||||||
Subsidiary Guarantors | ||||||||||||||||||||
14. Subsidiary Guarantors | ||||||||||||||||||||
On April 1, 2014, JEH and its wholly-owned subsidiary, Jones Energy Finance Corp. (the "Issuers"), sold $500.0 million in aggregate principal amount of the Issuers' 6.75% Senior Notes due 2022 (the "2022 Notes"). | ||||||||||||||||||||
The 2022 Notes are guaranteed on a senior unsecured basis by the Company and by all of JEH's current subsidiaries (except Jones Energy Finance Corp. and two immaterial subsidiaries) and certain future subsidiaries, including any future subsidiaries that guarantee any indebtedness under the Company's Revolver. Each subsidiary guarantor is 100% owned by JEH, and all guarantees are full, unconditional, and joint and several with all other subsidiary guarantees and the parent guarantee. Any subsidiaries of JEH other than the subsidiary guarantors and Jones Energy Finance Corp. are minor. | ||||||||||||||||||||
The Company is a holding company and has no independent assets or operations of its own. The Company is the sole managing member of JEH and is responsible for all operational, management and administrative decisions related to JEH's business. In accordance with JEH's limited liability company agreement, the Company may not be removed as the sole managing member of JEH. | ||||||||||||||||||||
As of December 31, 2014, the Company held approximately 25.6% of the economic interest in JEH, with the remaining 74.4% economic interest held by a group of investors that owned interests in JEH prior to the Company's IPO (the "Existing Owners"). The Existing Owners have no voting rights with respect to their economic interest in JEH. | ||||||||||||||||||||
The Company has two classes of common stock, Class A common stock, which was sold to investors in the IPO, and Class B common stock. Pursuant to the Company's certificate of incorporation, each share of Class A common stock is entitled to one vote per share, and the shares of Class A common stock are entitled to 100% of the economic interests in the Company. Each share of Class B common stock has no economic rights in the Company, but entitles its holder to one vote on all matters to be voted on by the Company's stockholders generally. | ||||||||||||||||||||
In connection with a reorganization that occurred immediately prior to the IPO, each Existing Owner was issued a number of shares of Class B common stock that is equal to the number of JEH Units that such Existing Owner holds. Holders of the Company's Class A common stock and Class B common stock generally vote together as a single class on all matters presented to the Company's stockholders for their vote or approval. Accordingly, the Existing Owners collectively have a number of votes in the Company equal to the aggregate number of JEH Units that they hold. | ||||||||||||||||||||
The Existing Owners have the right, pursuant to the terms of an Exchange Agreement by and among the Company, JEH and each of the Existing Owners, to exchange their JEH Units (together with a corresponding number of shares of Class B common stock) for shares of Class A common stock on a one-for-one basis, subject to customary conversion rate adjustments for stock splits, stock dividends and reclassifications and other similar transactions. As a result, the Company expects that over time the Company will have an increasing economic interest in JEH as Class B common stock and JEH Units are exchanged for Class A common stock. Moreover, any transfers of JEH Units outside of the Exchange Agreement (other than permitted transfers to affiliates) must be approved by the Company. The Company intends to retain full voting and management control over JEH. | ||||||||||||||||||||
Jones Energy, Inc. | ||||||||||||||||||||
Condensed Consolidating Balance Sheet | ||||||||||||||||||||
December 31, 2014 | ||||||||||||||||||||
(in thousands of dollars) | JEI (Parent) | Issuers | Guarantor | Non- | Eliminations | Consolidated | ||||||||||||||
Subsidiaries | Guarantor | |||||||||||||||||||
Subsidiaries | ||||||||||||||||||||
Assets | ||||||||||||||||||||
Current assets | ||||||||||||||||||||
Cash | $ | 100 | $ | 1,000 | $ | 12,436 | $ | 30 | $ | — | $ | 13,566 | ||||||||
Restricted cash | — | — | 149 | — | — | 149 | ||||||||||||||
Accounts receivable, net | ||||||||||||||||||||
Oil and gas sales | — | — | 49,861 | — | — | 49,861 | ||||||||||||||
Joint interest owners | — | — | 41,761 | — | — | 41,761 | ||||||||||||||
Other | 102 | 8,788 | 3,622 | — | — | 12,512 | ||||||||||||||
Commodity derivative assets | — | 121,519 | — | — | — | 121,519 | ||||||||||||||
Other current assets | — | 451 | 2,923 | — | — | 3,374 | ||||||||||||||
Intercompany receivable | 4,164 | 1,205,608 | — | (2,328 | ) | (1,207,444 | ) | — | ||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Total current assets | 4,366 | 1,337,366 | 110,752 | (2,298 | ) | (1,207,444 | ) | 242,742 | ||||||||||||
Oil and gas properties, net, at cost under the successful efforts method | — | — | 1,638,860 | — | — | 1,638,860 | ||||||||||||||
Other property, plant and equipment, net | — | — | 3,252 | 796 | — | 4,048 | ||||||||||||||
Commodity derivative assets | — | 87,055 | — | — | — | 87,055 | ||||||||||||||
Other assets | — | 20,098 | 254 | — | — | 20,352 | ||||||||||||||
Deferred tax assets | 171 | — | — | — | — | 171 | ||||||||||||||
Investment in subsidiaries | 231,866 | — | — | — | (231,866 | ) | — | |||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Total assets | $ | 236,403 | $ | 1,444,519 | $ | 1,753,118 | $ | (1,502 | ) | $ | (1,439,310 | ) | $ | 1,993,228 | ||||||
| | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
Liabilities and Stockholders' Equity | ||||||||||||||||||||
Current liabilities | ||||||||||||||||||||
Trade accounts payable | $ | — | $ | 288 | $ | 136,049 | $ | — | $ | — | $ | 136,337 | ||||||||
Oil and gas sales payable | — | — | 70,469 | — | — | 70,469 | ||||||||||||||
Accrued liabilities | — | 8,914 | 10,487 | — | — | 19,401 | ||||||||||||||
Deferred tax liabilities | — | 718 | — | — | — | 718 | ||||||||||||||
Asset retirement obligations | — | — | 3,074 | — | — | 3,074 | ||||||||||||||
Intercompany payable | — | — | 1,209,630 | — | (1,209,630 | ) | — | |||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Total current liabilities | — | 9,920 | 1,429,709 | — | (1,290,630 | ) | 229,999 | |||||||||||||
Long-term debt | — | 360,000 | — | — | — | 360,000 | ||||||||||||||
Senior notes | — | 500,000 | — | — | — | 500,000 | ||||||||||||||
Deferred revenue | — | 13,377 | — | — | — | 13,377 | ||||||||||||||
Commodity derivative liabilities | — | 28 | — | — | — | 28 | ||||||||||||||
Asset retirement obligations | — | — | 10,536 | — | — | 10,536 | ||||||||||||||
Liability under tax receivable agreement | 803 | — | — | — | — | 803 | ||||||||||||||
Deferred tax liabilities | 20,093 | 6,519 | — | — | — | 26,612 | ||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Total liabilities | 20,896 | 889,844 | 1,440,245 | — | (1,209,630 | ) | 1,141,355 | |||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Stockholders' / members' equity | ||||||||||||||||||||
Members' equity | — | 554,675 | 312,873 | (1,502 | ) | (866,046 | ) | — | ||||||||||||
Class A common stock, $0.001 par value; 12,672,260 shares issued and 12,649,658 shares outstanding | 13 | — | — | — | — | 13 | ||||||||||||||
Class B common stock, $0.001 par value; 36,719,499 shares issued and outstanding | 37 | — | — | — | — | 37 | ||||||||||||||
Treasury stock, at cost; 22,602 shares | (358 | ) | — | — | — | — | (358 | ) | ||||||||||||
Additional paid-in-capital | 177,133 | — | — | — | — | 177,133 | ||||||||||||||
Retained earnings | 38,682 | — | — | — | — | 38,682 | ||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Stockholders' equity | 215,507 | 554,675 | 312,873 | (1,502 | ) | (866,046 | ) | 215,507 | ||||||||||||
Non-controlling interest | — | — | — | — | 636,366 | 636,366 | ||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Total stockholders' equity | 215,507 | 554,675 | 312,873 | (1,502 | ) | (229,680 | ) | 851,873 | ||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Total liabilities and stockholders' equity | $ | 236,403 | $ | 1,444,519 | $ | 1,753,118 | $ | (1,502 | ) | $ | (1,439,310 | ) | $ | 1,993,228 | ||||||
| | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
Jones Energy, Inc. | ||||||||||||||||||||
Condensed Consolidating Balance Sheet | ||||||||||||||||||||
December 31, 2013 | ||||||||||||||||||||
(in thousands of dollars) | JEI (Parent) | Issuers | Guarantor | Non-Guarantor | Eliminations | Consolidated | ||||||||||||||
Subsidiaries | Subsidiaries | |||||||||||||||||||
Assets | ||||||||||||||||||||
Current assets | ||||||||||||||||||||
Cash | $ | 100 | $ | 6,000 | $ | 17,650 | $ | 70 | $ | — | $ | 23,820 | ||||||||
Restricted cash | — | — | 45 | — | — | 45 | ||||||||||||||
Accounts receivable, net | ||||||||||||||||||||
Oil and gas sales | — | — | 51,233 | — | — | 51,233 | ||||||||||||||
Joint interest owners | — | — | 42,481 | — | — | 42,481 | ||||||||||||||
Other | — | — | 16,782 | — | — | 16,782 | ||||||||||||||
Commodity derivative assets | — | 8,837 | — | — | — | 8,837 | ||||||||||||||
Other current assets | — | 387 | 2,005 | — | — | 2,392 | ||||||||||||||
Deferred tax assets | — | 12 | — | — | — | 12 | ||||||||||||||
Intercompany receivable | 638 | 1,051,389 | — | (1,052,027 | ) | — | ||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Total current assets | 738 | 1,066,625 | 130,196 | 70 | (1,052,027 | ) | 145,602 | |||||||||||||
Oil and gas properties, net, at cost under the successful efforts method | — | — | 1,297,228 | — | — | 1,297,228 | ||||||||||||||
Other property, plant and equipment, net | — | — | 2,557 | 887 | — | 3,444 | ||||||||||||||
Commodity derivative assets | — | 25,398 | — | — | — | 25,398 | ||||||||||||||
Other assets | — | 14,072 | 934 | — | — | 15,006 | ||||||||||||||
Investment in subsidiaries | 169,081 | — | — | — | (169,081 | ) | — | |||||||||||||
Deferred tax assets | 1,301 | — | — | — | — | 1,301 | ||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Total assets | $ | 171,120 | $ | 1,106,095 | $ | 1,430,915 | $ | 957 | $ | (1,221,108 | ) | $ | 1,487,979 | |||||||
| | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
Liabilities and Stockholders' Equity | ||||||||||||||||||||
Current liabilities | ||||||||||||||||||||
Trade accounts payable | $ | — | $ | 230 | $ | 89,200 | $ | — | $ | — | $ | 89,430 | ||||||||
Oil and gas sales payable | — | — | 66,179 | — | — | 66,179 | ||||||||||||||
Accrued liabilities | 87 | 1,642 | 9,076 | — | — | 10,805 | ||||||||||||||
Commodity derivative liabilities | — | 10,664 | — | — | — | 10,664 | ||||||||||||||
Asset retirement obligations | — | — | 2,590 | — | — | 2,590 | ||||||||||||||
Intercompany payable | — | — | 1,051,935 | 2,279 | (1,054,214 | ) | — | |||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Total current liabilities | 87 | 12,536 | 1,218,980 | 2,279 | (1,054,214 | ) | 179,668 | |||||||||||||
Long-term debt | — | 658,000 | — | — | — | 658,000 | ||||||||||||||
Deferred revenue | — | 14,531 | — | — | — | 14,531 | ||||||||||||||
Commodity derivative liabilities | — | 190 | — | — | — | 190 | ||||||||||||||
Asset retirement obligations | — | — | 8,373 | — | — | 8,373 | ||||||||||||||
Deferred tax liabilities | — | 3,093 | — | — | — | 3,093 | ||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Total liabilities | 87 | 688,350 | 1,227,353 | 2,279 | (1,054,214 | ) | 863,855 | |||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Stockholders' / members' equity | ||||||||||||||||||||
Members' equity | — | 417,745 | 203,562 | (1,322 | ) | (619,985 | ) | — | ||||||||||||
Class A common stock, $0.001 par value; 12,526,580 shares issued and outstanding | 13 | — | — | — | — | 13 | ||||||||||||||
Class B common stock, $0.001 par value; 36,836,333 shares issued and outstanding | 37 | — | — | — | — | 37 | ||||||||||||||
Additional paid-in-capital | 173,169 | — | — | — | — | 173,169 | ||||||||||||||
Retained earnings (deficit) | (2,186 | ) | — | — | — | — | (2,186 | ) | ||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Stockholders' equity | 171,033 | 417,745 | 203,562 | (1,322 | ) | (619,985 | ) | 171,033 | ||||||||||||
Non-controlling interest | — | — | — | — | 453,091 | 453,091 | ||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Total stockholders' equity | 171,033 | 417,745 | 203,562 | (1,322 | ) | (166,894 | ) | 624,124 | ||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Total liabilities and stockholders' equity | $ | 171,120 | $ | 1,106,095 | $ | 1,430,915 | $ | 957 | $ | (1,221,108 | ) | $ | 1,487,979 | |||||||
| | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
Jones Energy, Inc. | ||||||||||||||||||||
Condensed Consolidating Statement of Operations and Comprehensive Income | ||||||||||||||||||||
Year Ended December 31, 2014 | ||||||||||||||||||||
(in thousands) | JEI (Parent) | Issuers | Guarantor | Non- | Eliminations | Consolidated | ||||||||||||||
Subsidiaries | Guarantor | |||||||||||||||||||
Subsidiaries | ||||||||||||||||||||
Operating revenues | ||||||||||||||||||||
Oil and gas sales | $ | — | $ | — | $ | 378,401 | $ | — | $ | — | $ | 378,401 | ||||||||
Other revenues | — | 1,154 | 1,042 | — | — | 2,196 | ||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Total operating revenues | — | 1,154 | 379,443 | — | — | 380,597 | ||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Operating costs and expenses | ||||||||||||||||||||
Lease operating | — | — | 43,843 | — | — | 43,843 | ||||||||||||||
Production taxes | — | — | 18,094 | — | — | 18,094 | ||||||||||||||
Exploration | — | — | 3,453 | — | — | 3,453 | ||||||||||||||
Depletion, depreciation and amortization | — | — | 181,578 | 91 | — | 181,669 | ||||||||||||||
Accretion of discount | — | — | 770 | — | — | 770 | ||||||||||||||
General and administrative (including non-cash compensation expense) | — | 4,494 | 21,180 | 89 | — | 25,763 | ||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Total operating expenses | — | 4,494 | 268,918 | 180 | — | 273,592 | ||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Operating income | — | (3,340 | ) | 110,525 | (180 | ) | — | 107,005 | ||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Other income (expense) | ||||||||||||||||||||
Interest expense | — | (45,215 | ) | (1,511 | ) | — | — | (46,726 | ) | |||||||||||
Net gain on commodity derivatives | — | 189,641 | — | — | — | 189,641 | ||||||||||||||
Gain on sales of assets | — | — | 297 | — | — | 297 | ||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Other income (expense), net | — | 144,426 | (1,214 | ) | — | — | 143,212 | |||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Income (loss) before income tax | — | 141,086 | 109,311 | (180 | ) | — | 250,217 | |||||||||||||
Equity interest in income | 62,785 | (62,785 | ||||||||||||||||||
— | — | — | ) | — | ||||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Income tax provision | ||||||||||||||||||||
Current | 53 | 53 | ||||||||||||||||||
Deferred | 21,864 | 4,157 | 26,021 | |||||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Total income tax provision | 21,917 | 4,157 | — | — | — | 26,074 | ||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Net income (loss) | 40,868 | 136,929 | 109,311 | (180 | ) | (62,785 | ) | 224,143 | ||||||||||||
Net income attributable to non-controlling interests | — | — | — | — | 183,275 | 183,275 | ||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Net income attributable to controlling interests | $ | 40,868 | — | — | — | — | $ | 40,868 | ||||||||||||
| | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
Jones Energy, Inc. | ||||||||||||||||||||
Condensed Consolidating Statement of Operations and Comprehensive Income | ||||||||||||||||||||
Year Ended December 31, 2013 | ||||||||||||||||||||
(in thousands) | JEI (Parent) | Issuers | Guarantor | Non- | Eliminations | Consolidated | ||||||||||||||
Subsidiaries | Guarantor | |||||||||||||||||||
Subsidiaries | ||||||||||||||||||||
Operating revenues | ||||||||||||||||||||
Oil and gas sales | $ | — | $ | — | $ | 258,063 | $ | — | $ | — | $ | 258,063 | ||||||||
Other revenues | — | 469 | 637 | — | — | 1,106 | ||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Total operating revenues | — | 469 | 258,700 | — | — | 259,169 | ||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Operating costs and expenses | ||||||||||||||||||||
Lease operating | — | — | 27,781 | — | — | 27,781 | ||||||||||||||
Production taxes | — | — | 12,865 | — | — | 12,865 | ||||||||||||||
Exploration | — | — | 1,710 | — | — | 1,710 | ||||||||||||||
Depletion, depreciation and amortization | — | — | 114,046 | 90 | — | 114,136 | ||||||||||||||
Impairment of oil and gas properties | — | — | 14,415 | — | — | 14,415 | ||||||||||||||
Accretion of discount | — | — | 608 | — | — | 608 | ||||||||||||||
General and administrative (including non-cash compensation expense) | — | 4,154 | 27,490 | 258 | — | 31,902 | ||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Total operating expenses | — | 4,154 | 198,915 | 348 | — | 203,417 | ||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Operating income | — | (3,685 | ) | 59,785 | (348 | ) | — | 55,752 | ||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Other income (expense) | ||||||||||||||||||||
Interest expense | — | (29,653 | ) | (1,121 | ) | — | — | (30,774 | ) | |||||||||||
Net gain (loss) on commodity derivatives | — | (2,566 | ) | — | — | — | (2,566 | ) | ||||||||||||
Gain (loss) on sales of assets | — | — | 41 | (119 | ) | — | (78 | ) | ||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Other income (expense), net | — | (32,219 | ) | (1,080 | ) | (119 | ) | — | (33,418 | ) | ||||||||||
| | | | | | | | | | | | | | | | | | | | |
Income (loss) before income tax | — | (35,904 | ) | 58,705 | (467 | ) | — | 22,334 | ||||||||||||
Equity interest in income | (3,400 | 3,400 | ||||||||||||||||||
) | — | — | — | — | ||||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Income tax provision (benefit) | ||||||||||||||||||||
Current | 85 | — | — | — | 85 | |||||||||||||||
Deferred | (1,299 | ) | 1,143 | — | — | — | (156 | ) | ||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Total income tax provision (benefit) | (1,214 | ) | 1,143 | — | — | — | (71 | ) | ||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Net income (loss) | (2,186 | ) | (37,047 | ) | 58,705 | (467 | ) | 3,400 | 22,405 | |||||||||||
Net income attributable to non-controlling interests | — | — | — | — | 24,591 | 24,591 | ||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Net income (loss) attributable to controlling interests | $ | (2,186 | ) | — | — | — | — | $ | (2,186 | ) | ||||||||||
| | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
Jones Energy, Inc. | ||||||||||||||||||||
Condensed Consolidating Statement of Cash Flows | ||||||||||||||||||||
Year Ended December 31, 2014 | ||||||||||||||||||||
(in thousands of dollars) | JEI (Parent) | Issuers | Guarantor | Non- | Eliminations | Consolidated | ||||||||||||||
Subsidiaries | Guarantor | |||||||||||||||||||
Subsidiaries | ||||||||||||||||||||
Cash flows from operating activities | ||||||||||||||||||||
Net income (loss) | $ | 40,868 | $ | 136,929 | $ | 109,311 | $ | (180 | ) | $ | (62,785 | ) | $ | 224,143 | ||||||
Adjustments to reconcile net income (loss) to net cash provided by operating activities | (40,510 | ) | (326,859 | ) | 345,724 | 140 | 62,785 | 41,280 | ||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Net cash (used in) / provided by operations | 358 | (189,930 | ) | 455,035 | (40 | ) | — | 265,423 | ||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Cash flows from investing activities | ||||||||||||||||||||
Additions to oil and gas properties | — | — | (474,619 | ) | — | — | (474,619 | ) | ||||||||||||
Net adjustments to purchase price of properties acquired | — | — | 15,709 | — | — | 15,709 | ||||||||||||||
Proceeds from sales of assets | — | — | 448 | — | — | 448 | ||||||||||||||
Acquisition of other property, plant and equipment | — | — | (1,683 | ) | — | — | (1,683 | ) | ||||||||||||
Current period settlements of matured derivative contracts | — | (3,654 | ) | — | — | — | (3,654 | ) | ||||||||||||
Change in restricted cash | — | — | (104 | ) | — | — | (104 | ) | ||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Net cash (used in) / provided by investing | — | (3,654 | ) | (460,249 | ) | — | — | (463,903 | ) | |||||||||||
| | | | | | | | | | | | | | | | | | | | |
Cash flows from financing activities | ||||||||||||||||||||
Proceeds from issuance of long-term debt | — | 170,000 | — | — | — | 170,000 | ||||||||||||||
Repayment under long-term debt | — | (468,000 | ) | — | — | — | (468,000 | ) | ||||||||||||
Proceeds from senior notes | — | 500,000 | — | — | — | 500,000 | ||||||||||||||
Payment of debt issuance costs | — | (13,416 | ) | — | — | — | (13,416 | ) | ||||||||||||
Purchase of treasury stock | (358 | ) | — | — | — | — | (358 | ) | ||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Net cash (used in) / provided by financing | (358 | ) | 188,584 | — | — | — | 188,226 | |||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Net increase (decrease) in cash | — | (5,000 | ) | (5,214 | ) | (40 | ) | — | (10,254 | ) | ||||||||||
Cash | ||||||||||||||||||||
Beginning of period | 100 | 6,000 | 17,650 | 70 | — | 23,820 | ||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
End of period | $ | 100 | $ | 1,000 | $ | 12,436 | $ | 30 | $ | — | $ | 13,566 | ||||||||
| | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
Jones Energy, Inc. | ||||||||||||||||||||
Condensed Consolidating Statement of Cash Flows | ||||||||||||||||||||
Year Ended December 31, 2013 | ||||||||||||||||||||
(in thousands of dollars) | JEI (Parent) | Issuers | Guarantor | Non- | Eliminations | Consolidated | ||||||||||||||
Subsidiaries | Guarantor | |||||||||||||||||||
Subsidiaries | ||||||||||||||||||||
Cash flows from operating activities | ||||||||||||||||||||
Net income (loss) | $ | (2,186 | ) | $ | (37,047 | ) | $ | 58,705 | $ | (467 | ) | $ | 3,400 | $ | 22,405 | |||||
Adjustments to reconcile net income (loss) to net cash provided by operating activities | 2,286 | (189,393 | ) | 315,942 | 733 | (3,400 | ) | 126,168 | ||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Net cash (used in) / provided by operations | 100 | (226,440 | ) | 374,647 | 266 | — | 148,573 | |||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Cash flows from investing activities | ||||||||||||||||||||
Investment in subsidiary | (172,481 | ) | — | — | — | 172,481 | — | |||||||||||||
Additions to oil and gas properties | — | — | (197,618 | ) | — | — | (197,618 | ) | ||||||||||||
Acquisition of properties | — | — | (178,173 | ) | — | — | (178,173 | ) | ||||||||||||
Proceeds from sales of assets | — | — | 963 | 644 | — | 1,607 | ||||||||||||||
Acquisition of other property, plant and equipment | — | — | (724 | ) | (910 | ) | — | (1,634 | ) | |||||||||||
Current period settlements of matured derivative contracts | — | 7,586 | — | — | — | 7,586 | ||||||||||||||
Change in restricted cash | — | — | (45 | ) | — | — | (45 | ) | ||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Net cash (used in) / provided by investing | (172,481 | ) | 7,586 | (375,597 | ) | (266 | ) | 172,481 | (368,277 | ) | ||||||||||
| | | | | | | | | | | | | | | | | | | | |
Cash flows from financing activities | ||||||||||||||||||||
Proceeds from investment in JEI | — | 172,481 | — | — | (172,481 | ) | — | |||||||||||||
Proceeds from issuance of long-term debt | — | 220,000 | — | — | 220,000 | |||||||||||||||
Repayment under long-term debt | — | (172,000 | ) | — | — | (172,000 | ) | |||||||||||||
Payment of debt issuance costs | — | (683 | ) | — | — | (683 | ) | |||||||||||||
Proceeds from sale of common stock, net of expenses of $15.1 million | 172,481 | — | — | — | 172,481 | |||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Net cash (used in) / provided by financing | 172,481 | 219,798 | — | — | (172,481 | ) | 219,798 | |||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Net increase (decrease) in cash | 100 | 944 | (950 | ) | — | — | 94 | |||||||||||||
Cash | ||||||||||||||||||||
Beginning of period | — | 5,056 | 18,600 | 70 | — | 23,726 | ||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
End of period | $ | 100 | $ | 6,000 | $ | 17,650 | $ | 70 | $ | — | $ | 23,820 | ||||||||
| | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
Significant_Accounting_Policie1
Significant Accounting Policies (Policies) | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Significant Accounting Policies | ||||||||
Basis of Presentation | ||||||||
Basis of Presentation | ||||||||
The accompanying financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP"). All significant intercompany transactions and balances have been eliminated in consolidation. The financial statements reported for December 31, 2014 and 2013 and the results of the operations and the cash flows for each of the three years in the period ended December 31, 2014 include the Company and all of its subsidiaries. | ||||||||
Segment Information | ||||||||
Segment Information | ||||||||
The Company operates in one industry segment, which is the exploration, development and production of oil and natural gas, and all of its operations are conducted in one geographic area of the United States. | ||||||||
Use of Estimates | ||||||||
Use of Estimates | ||||||||
In preparing the accompanying financial statements, management has made certain estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent liabilities, and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from these estimates. Changes in estimates are recorded prospectively. | ||||||||
Significant assumptions are required in the valuation of proved oil and natural gas reserves, which affect the Company's estimates of depletion expense, impairment, and the allocation of value in our business combinations. Significant assumptions are also required in the Company's estimates of the net gain or loss on commodity derivative assets and liabilities, fair value associated with business combinations, and asset retirement obligations ("ARO"). | ||||||||
Financial Instruments | ||||||||
Financial Instruments | ||||||||
Cash, accounts receivable and accounts payable are recorded at cost. The fair value of accounts receivable and accounts payable are not materially different from their carrying amounts because of the short-term nature of these instruments. The carrying value of the outstanding balance under the Company's Revolver (as defined in Note 6) represents fair value because the Revolver has variable interest rates, which are reflective of the Company's credit risk. The Company's senior notes have a fixed interest rate and are reported at historical value as of the initial measurement date when issued and their fair value is discussed in Note 4. Derivative instruments are recorded at fair value, as discussed below. | ||||||||
Cash | ||||||||
Cash | ||||||||
Cash and cash equivalents include highly liquid investments with a maturity of three months or less. At times, the amount of cash on deposit in financial institutions exceeds federally insured limits. Management monitors the soundness of the financial institutions and believes the Company's risk is not significant. | ||||||||
Accounts Receivable | ||||||||
Accounts Receivable | ||||||||
Accounts receivable—Oil and gas sales consist of uncollateralized accrued revenues due under normal trade terms, generally requiring payment within 30 to 60 days of production. Accounts receivable—Joint interest owners consist of uncollateralized joint interest owner obligations due within 30 days of the invoice date. Accounts receivable—Other consists at December 31, 2014 of derivative positions not settled as of the balance sheet date and severance tax refunds due from state agencies and at December 31, 2013 of the adjustments to the purchase price of the Sabine properties purchased in December 2013 and severance tax refunds due from state agencies. No interest is charged on past-due balances. The Company routinely assesses the recoverability of all material trade, joint interest and other receivables to determine their collectability, and reduces the carrying amounts by a valuation allowance that reflects management's best estimate of the amounts that may not be collected. As of December 31, 2014 and 2013, the Company did not have significant allowances for doubtful accounts. | ||||||||
Concentration of Risk | ||||||||
Concentration of Risk | ||||||||
Substantially all of the Company's accounts receivable are related to the oil and gas industry. This concentration of entities may affect the Company's overall credit risk in that these entities may be affected similarly by changes in economic and other conditions, including declines in commodity prices. As of December 31, 2014, 70% of Accounts receivable—Oil and gas sales are due from 5 purchasers and 67% of Accounts receivable—Joint interest owners are due from 5 working interest owners. As of December 31, 2013, 79% of Accounts receivable—Oil and gas sales were due from 8 purchasers, and 77% of 2013 Accounts receivable—Joint interest owners were due from 5 working interest owners. If any or all of these significant counterparties were to fail to pay amounts due to the Company, the Company's financial position and results of operations could be materially and adversely affected. | ||||||||
Dependence on Major Customers | ||||||||
Dependence on Major Customers | ||||||||
The Company maintains a portfolio of crude oil and natural gas marketing contracts with large, established refiners and oil and gas purchasers. During the year ended December 31, 2014, the largest purchasers were Valero Energy Corp. ("Valero"), NGL Energy Partners LP, PVR Midstream LLC ("PVR Midstream"), Plains Marketing LP ("Plains Marketing"), and Monarch Natural Gas LLC which accounted for approximately 22%, 12%, 12%, 10% and 10% of consolidated oil and gas sales, respectively. During the year ended December 31, 2013, the largest purchasers were PVR Midstream, Unimark LLC, Mercuria Energy Group Ltd. ("Mercuria"), Valero, and Plains Marketing, which accounted for approximately 15%, 13%, 13%, 13% and 6% of consolidated oil and gas sales, respectively. During the year ended December 31, 2012, the largest purchasers were Unimark LLC, Mercuria, PVR Midstream, and Plains Marketing, which accounted for approximately 24%, 18%, 18% and 15% of consolidated oil and gas sales, respectively. | ||||||||
Management believes that there are alternative purchasers and that it may be necessary to establish relationships with such new purchasers. However, there can be no assurance that the Company can establish such relationships and that those relationships will result in an increased number of purchasers. Although the Company is exposed to a concentration of credit risk, management believes that all of the Company's purchasers are credit worthy. | ||||||||
Dependence on Suppliers | ||||||||
Dependence on Suppliers | ||||||||
The Company's industry is cyclical, and from time to time, there can be an imbalance between the supply of and demand for drilling rigs, equipment, services, supplies and qualified personnel. During periods of oversupply, there can be financial pressure on suppliers. If the financial pressure leads to work interruptions or stoppages, the Company could be materially and adversely affected. Management believes that there are adequate alternative providers of drilling and completion services although it may become necessary to establish relationships with new contractors. However, there can be no assurance that the Company can establish such relationships and that those relationships will result in increased availability of drilling rigs or other services, or that they could be obtained on the same terms. | ||||||||
Oil and Gas Properties | ||||||||
Oil and Gas Properties | ||||||||
The Company accounts for its oil and natural gas exploration and production activities under the successful efforts method of accounting. Oil and gas properties consisted of the following at December 31, 2014 and 2013: | ||||||||
(in thousands of dollars) | 2014 | 2013 | ||||||
Mineral interests in properties | ||||||||
Unproved | $ | 94,526 | $ | 99,134 | ||||
Proved | 1,001,194 | 958,816 | ||||||
Wells and equipment and related facilities | 1,094,202 | 609,748 | ||||||
| | | | | | | | |
2,189,922 | 1,667,698 | |||||||
Less: Accumulated depletion and impairment | (551,062 | ) | (370,470 | ) | ||||
| | | | | | | | |
Net oil and gas properties | $ | 1,638,860 | $ | 1,297,228 | ||||
| | | | | | | | |
| | | | | | | | |
Costs to acquire mineral interests in oil and natural gas properties are capitalized. Costs to drill and equip development wells and the related asset retirement costs are capitalized. The costs to drill and equip exploratory wells are capitalized pending determination of whether the Company has discovered proved commercial reserves. If proved commercial reserves are not discovered, such drilling costs are charged to expense. In some circumstances, it may be uncertain whether proved commercial reserves have been found when drilling has been completed. Such exploratory well drilling costs may continue to be capitalized if the anticipated reserve quantity is sufficient to justify its completion as a producing well and sufficient progress in assessing the reserves and the economic and operating viability of the project is being made. As of December 31, 2014 and 2013, we had no material capitalized costs associated with exploratory wells. | ||||||||
The Company capitalizes interest on expenditures for significant exploration and development projects that last more than six months while activities are in progress to bring the assets to their intended use. The Company capitalized less than $0.1 million in interest costs during 2014 for one project. No interest costs were capitalized in 2013. Costs incurred to maintain wells and related equipment are charged to expense as incurred. | ||||||||
On the sale or retirement of a proved field, the cost and related accumulated depletion, depreciation and amortization are eliminated from the field accounts, and the resultant gain or loss is recognized. | ||||||||
Capitalized amounts attributable to proved oil and gas properties are depleted by the unit-of-production method over proved reserves, using the unit conversion ratio of six thousand cubic feet of gas to one barrel of oil equivalent. Depletion of the costs of wells and related equipment and facilities, including capitalized asset retirement costs, net of salvage values, is computed using proved developed reserves. The reserve base used to calculate depreciation, depletion, and amortization for leasehold acquisition costs and the cost to acquire proved properties is the sum of proved developed reserves and proved undeveloped reserves. Depletion of oil and gas properties amounted to $180.6 million, $113.3 million and $79.9 million for the years ended December 31, 2014, 2013 and 2012, respectively. | ||||||||
The Company reviews its proved oil and natural gas properties, including related wells and equipment, for impairment by comparing expected undiscounted future cash flows at a producing field level to the net capitalized cost of the asset. If the future undiscounted cash flows, based on the Company's estimate of future commodity prices, operating costs, and production, are lower than the net capitalized cost, the capitalized cost is reduced to fair value. Fair value is calculated by discounting the future cash flows at an appropriate risk-adjusted discount rate. Due to the significant assumptions associated with the inputs and calculations described, the fair value of oil and gas properties used in estimating impairment represents a nonrecurring Level 3 measurement. No impairments of proved properties were recorded in 2014 or 2013. The Company incurred impairment charges of $18.8 million related to its proved oil and natural gas properties and equipment in 2012. | ||||||||
The Company evaluates its unproved properties for impairment on a property-by-property basis. The Company's unproved property consists of acquisition costs related to its undeveloped acreage. The Company reviews the unproved property for indicators of impairment based on the Company's current exploration plans with consideration given to results of any drilling and seismic activity during the period and known information regarding exploration and development activity by other companies on adjacent blocks. The Company incurred no impairment charges related to its unproved properties in 2014 or 2012. In the fourth quarter of 2013, the Company recorded an impairment charge of $14.4 million related to its unproved Southridge properties in the Arkoma basin. As the Company did not drill the required number of wells by October 31, 2013 necessary to keep its joint development agreement with Southridge in effect, the Company lost its right to the undeveloped acreage. Impairment of oil and gas properties charges are recorded on the Consolidated Statement of Operations. | ||||||||
On the sale of an entire interest in an unproved property, gain or loss on the sale is recognized, taking into consideration the amount of any recorded impairment if the property had been assessed individually. If a partial interest in an unproved property is sold, the amount received is treated as a reduction of the cost of the interest retained. | ||||||||
Other Property, Plant and Equipment | ||||||||
Other Property, Plant and Equipment | ||||||||
Other property, plant and equipment consisted of the following at December 31, 2014 and 2013: | ||||||||
(in thousands of dollars) | 2014 | 2013 | ||||||
Leasehold improvements | $ | 1,218 | $ | 1,060 | ||||
Furniture, fixtures, computers and software | 3,727 | 2,491 | ||||||
Vehicles | 988 | 835 | ||||||
Aircraft | 910 | 910 | ||||||
Other | 219 | 134 | ||||||
| | | | | | | | |
7,062 | 5,430 | |||||||
Less: Accumulated depreciation and amortization | (3,014 | ) | (1,986 | ) | ||||
| | | | | | | | |
Net other property, plant and equipment | $ | 4,048 | $ | 3,444 | ||||
| | | | | | | | |
| | | | | | | | |
Other property, plant and equipment is depreciated on a straight-line basis over the estimated useful lives of the property, plant and equipment, which range from three years to ten years. Depreciation and amortization of other property, plant and equipment amounted to $1.1 million, $0.8 million and $0.8 million during the years ended December 31, 2014, 2013 and 2012, respectively. | ||||||||
Oil and Gas Sales Payable | ||||||||
Oil and Gas Sales Payable | ||||||||
Oil and gas sales payable represents amounts collected from purchasers for oil and gas sales, which are due to other revenue interest owners. Generally, the Company is required to remit amounts due under these liabilities within 60 days of receipt. | ||||||||
Commodity Derivatives | ||||||||
Commodity Derivatives | ||||||||
The Company records its commodity derivative instruments on the Consolidated Balance Sheet as either an asset or liability measured at its fair value. Changes in the derivative's fair value are recognized currently in earnings, unless specific hedge accounting criteria are met. During the years ended December 31, 2014, 2013 and 2012, the Company elected not to designate any of its commodity price risk management activities as cash flow or fair value hedges. The changes in the fair values of outstanding financial instruments are recognized as gains or losses in the period of change. | ||||||||
Although the Company does not designate its commodity derivative instruments as cash-flow hedges, management uses those instruments to reduce the Company's exposure to fluctuations in commodity prices related to its natural gas and oil production. Net gains and losses, at fair value, are included on the Consolidated Balance Sheet as current or noncurrent assets or liabilities based on the anticipated timing of cash settlements under the related contracts. Changes in the fair value of commodity derivative contracts are recorded in earnings as they occur and are included in other income (expense) on the Consolidated Statement of Operations. See Note 4, "Fair Value Measurement," for disclosure about the fair values of commodity derivative instruments. | ||||||||
Asset Retirement Obligations | ||||||||
Asset Retirement Obligations | ||||||||
The Company's asset retirement obligations ("ARO") consist of future plugging and abandonment expenses on oil and natural gas properties. The Company estimates an ARO for each well in the period in which it is incurred based on estimated present value of plugging and abandonment costs, increased by an inflation factor to the estimated date that the well would be plugged. The resulting liability is recorded by increasing the carrying amount of the related long- lived asset. The liability is then accreted to its then-present value each period and the capitalized cost is depleted over the useful life of the related asset. If the liability is settled for an amount other than the recorded amount, a gain or loss is recognized. The ARO is classified as current or noncurrent based on the expect timing of payments. A summary of the Company's ARO for the years ended December 31, 2014 and 2013 is as follows: | ||||||||
(in thousands of dollars) | 2014 | 2013 | ||||||
ARO liability at beginning of year | $ | 10,963 | $ | 9,506 | ||||
Liabilities incurred(1) | 1,995 | 1,515 | ||||||
Accretion of discount | 770 | 608 | ||||||
Liabilities settled due to sale of related properties | (109 | ) | (271 | ) | ||||
Liabilities settled due to plugging and abandonment | (55 | ) | (702 | ) | ||||
Change in estimate | 46 | 307 | ||||||
| | | | | | | | |
ARO liability at end of year | 13,610 | 10,963 | ||||||
Less: Current portion of ARO at end of year | (3,074 | (2,590 | ||||||
) | ) | |||||||
| | | | | | | | |
Total long-term ARO at end of year | $ | 10,536 | $ | 8,373 | ||||
| | | | | | | | |
| | | | | | | | |
-1 | Includes $824 related to wells acquired in 2013 (see Note 3, "Acquisition of Properties"). | |||||||
Revenue Recognition | Revenue Recognition | |||||||
Revenues from the sale of crude oil, natural gas, and natural gas liquids are recognized when the product is delivered at a fixed or determinable price, title has transferred, collectability is reasonably assured and evidenced by a contract. The Company follows the "sales method" of accounting for its oil and natural gas revenue, so it recognizes revenue on all crude oil, natural gas, and natural gas liquids sold to purchasers. A receivable or liability is recognized only to the extent that the Company has an imbalance on a specific property greater than the expected remaining proved reserves. | ||||||||
Production Costs | ||||||||
Production Costs | ||||||||
Production costs, including compressor rental, pumpers' salaries, saltwater disposal, ad valorem taxes, insurance, repairs and maintenance, expensed workovers and other operating expenses are expensed as incurred and included in lease operating expense on the Consolidated Statement of Operations. | ||||||||
Exploration Expenses | ||||||||
Exploration Expenses | ||||||||
Exploration expenses include dry hole costs, lease extensions, delay rentals and geological and geophysical costs. | ||||||||
Income Taxes | ||||||||
Income Taxes | ||||||||
Following its IPO on July 29, 2013, the Company began recording a federal and state income tax liability associated with its status as a corporation. No provision for federal income taxes was recorded prior to the IPO because the taxable income or loss was includable in the income tax returns of the individual partners and members. The Company is also subject to state income taxes. The State of Texas includes in its tax system a franchise tax applicable to the Company and an accrual for franchise taxes is included in the financial statements when appropriate. | ||||||||
Income taxes are accounted for under the asset and liability method, which requires recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements. Under this method, deferred tax assets and liabilities are determined based on the differences between the financial statements and tax basis of assets and liabilities using enacted tax rates in effect for the year in which differences are expected to be recovered or settled pursuant to the provisions of ASC 740—Income Taxes. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period that includes the enactment date. | ||||||||
The Company records a valuation allowance if it is deemed more likely than not that all or a portion of its deferred income tax assets will not be realized. In addition, income tax rules and regulations are subject to interpretation and the application of those rules and regulations require judgment by the Company and may be challenged by the taxation authorities. The Company follows ASC 740-10-25, which requires the use of a two-step approach for recognizing and measuring tax benefits taken or expected to be taken in a tax return and disclosures regarding uncertainties in income tax positions. Only tax positions that meet the more likely than not recognition threshold are recognized. The Company's policy is to include any interest and penalties recorded on uncertain tax positions as a component of income tax expense. The Company's unrecognized tax benefits or related interest and penalties are immaterial. | ||||||||
Liability under Tax Receivable Agreement | ||||||||
Liability under Tax Receivable Agreement | ||||||||
In connection with the IPO, the Company entered into a Tax Receivable Agreement (the "TRA") which obligated the Company to make payments to certain current and former owners equal to 85% of the applicable cash savings that the Company realizes as a result of tax attributes arising from exchanges of JEH Units and JEI Class B shares held by those owners for Class A shares of JEI common stock. The Company will retain the benefit of the remaining 15% of these tax savings. | ||||||||
As a result of exchanges made through December 31, 2014, the Company has accrued future tax benefits of $0.9 million and has recorded this amount as a deferred tax asset on its consolidated balance sheet. As of December 31, 2014, the Company has recorded a liability of $0.8 million associated with its future TRA obligation. The actual amount and timing of payments made under the TRA will depend upon a number of factors, including the amount and timing of taxable income generated in the future, changes in future tax rates, the use of loss carryovers, and the portion of the Company's payments under the TRA constituting imputed interest. To the extent the Company does not realize all of the tax benefits in future years or in the event of a change in future tax rates, this liability may change. | ||||||||
As of December 31, 2014, the Company has made no payments under the TRA and does not anticipate making a material payment under the TRA in 2015. | ||||||||
Comprehensive Income | ||||||||
Comprehensive Income | ||||||||
The Company has no elements of comprehensive income other than net income. | ||||||||
Statement of Cash Flows | ||||||||
Statement of Cash Flows | ||||||||
The Company presents its cash flows using the indirect method. | ||||||||
Related Party Transactions | ||||||||
Related Party Transactions | ||||||||
In the years ended December 31, 2013 and 2012, the Company paid an annual administration fee to Metalmark of $0.7 million. This amount was charged to expense. As a result of the IPO, this fee is no longer payable to Metalmark. | ||||||||
On May 7, 2013, the Company entered into a natural gas sale and purchase agreement with Monarch Natural Gas, LLC, ("Monarch"), under which Monarch has the first right to gather the natural gas the Company produces from dedicated properties, process the NGLs from this natural gas production and market the processed natural gas and extracted NGLs. Under the Monarch agreement, the Company is paid a specified percentage of the value of the NGLs extracted and sold by Monarch, based on a set liquids recovery percentage, and the amount received from the sale of the residue gas, after deducting a fixed volume for fuel, lost and unaccounted for gas. The Company produced approximately 1.4 MMBoe of natural gas and NGLs for the year ended December 31, 2014 and 0.8 MMBoe of natural gas and NGLs for the year ended December 31, 2013, from the properties that became subject to the Monarch agreement. The initial term of the agreement runs for 10 years from the effective date of September 1, 2013. | ||||||||
At the time the Company entered into the agreement, Metalmark Capital owned approximately 81% of the outstanding equity interests of Monarch. In addition, Metalmark Capital beneficially owns in excess of five percent of the Company's outstanding equity interests and two of our directors, Howard I. Hoffen and Gregory D. Myers, are managing directors of Metalmark Capital. In connection with the Company's entering into the Monarch agreement, Monarch issued to JEH equity interests in Monarch having a deemed value of $15 million. JEH assigned $2.4 million of the Monarch equity interests to Jonny Jones, the Company's chief executive officer and chairman of the board, and reserved $2.6 million of the Monarch equity interests to a benefit plan established for certain of the Company's officers, including Mike McConnell, Robert Brooks and Eric Niccum. The remaining $10 million of Monarch equity was distributed to certain of the pre-IPO owners, which include Metalmark Capital, Wells Fargo, the Jones family entities, and certain of the Company's officers and directors, including Jonny Jones, Mike McConnell and Eric Niccum. | ||||||||
In September 2014, the Company signed a 10-year oil gathering and transportation agreement with Monarch Oil Pipeline LLC, pursuant to which Monarch Oil Pipeline, LLC will build, at its expense, a new oil gathering system and connect to dedicated Company leases in Texas. At the time the Company entered into the agreement, Metalmark Capital owned the majority of the outstanding equity interests of Monarch Oil Pipeline, LLC and/or its parent. The system is expected to begin service during the second quarter of 2015 and provide connectivity to both a regional refinery market as well as the Cushing market hub. The Company has reserved capacity of up to 12,000 barrels per day on the system with the potential to increase throughput at a future date. | ||||||||
Stock Compensation | ||||||||
Stock Compensation | ||||||||
JEH implemented a management incentive plan effective January 1, 2010, that provided awards of membership interests in JEH to members of senior management ("management units"). The management unit grants awarded prior to the initial filing of the IPO registration statement in March 2013 had a dual vesting schedule and were fully vested as of December 31, 2014. Grants awarded after the initial IPO registration statement generally have a single vesting structure of five equal annual installments and were valued at the IPO price, adjusted for equivalent shares. Both the vested and unvested management units were converted into JEH Units and shares of Class B common stock at the IPO date. At December 31, 2014, there were 274,385 unvested JEH Units and shares of Class B common stock that will become convertible into a like number of shares of Class A common stock upon vesting. | ||||||||
Under the Jones Energy, Inc. 2013 Omnibus Incentive Plan, established in conjunction with the Company's IPO, the Company reserved 3,850,000 shares of Class A common stock for director and employee stock-based compensation awards. | ||||||||
During 2014, the Company granted performance unit and restricted stock unit awards to certain officers and employees under the Jones Energy, Inc. 2013 Omnibus Incentive Plan. The fair value of the performance units was based on the grant date fair value (using a Monte Carlo simulation model) and is expensed on a straight-line basis over the applicable three-year performance period. The number of shares of Class A common stock issuable upon vesting of the performance unit awards ranges from zero to 200% based on the Company's total shareholder return relative to an industry peer group over the applicable three-year performance period. The fair value of the restricted stock unit awards was based on the value of the Company's Class A common stock on the date of grant and is expensed on a straight-line basis over the applicable three-year vesting period. | ||||||||
In September 2014 and 2013, the Company granted each of the outside members of the Board of Directors 5,486 and 6,645 shares, respectively, of restricted Class A common stock under the Jones Energy, Inc. 2013 Omnibus Incentive Plan. The fair value of the restricted stock grants was based on the value of the Company's Class A common stock on the date of grant and is expensed on a straight-line basis over the one-year vesting period. | ||||||||
Refer to Note 7, "Stock-based Compensation," for additional information regarding director and employee stock-based compensation awards | ||||||||
Business Combinations | ||||||||
Business Combinations | ||||||||
For acquisitions of working interests that are accounted for as business combinations, the results of operations are included in the Consolidated Statement of Operations from the date of acquisition. Purchase prices are allocated to assets acquired based on their estimated fair values at the time of acquisition. Fair value is the price that would be received to sell an asset or would be paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value measurement is based on the assumptions of market participants and not those of the reporting entity. Therefore, entity-specific intentions do not impact the measurement of fair value. The fair value of oil and natural gas properties is determined using a risk-adjusted after-tax discounted cash flow analysis based upon significant inputs including: 1) oil and gas prices, 2) projections of estimated quantities of oil and natural gas reserves, including those classified as proved, probable and possible, 3) projections of future rates of production, 4) timing and amount of future development and operating costs, 5) projected reserve recovery factors, and 6) weighted average cost of capital. | ||||||||
Recent Accounting Pronouncements | ||||||||
Recent Accounting Pronouncements | ||||||||
In May 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2014-09, "Revenue from Contracts with Customers," which creates a new topic in the Accounting Standards Codification ("ASC"), topic 606, "Revenue from Contracts with Customers." This ASU sets forth a five-step model for determining when and how revenue is recognized. Under the model, an entity will be required to recognize revenue to depict the transfer of goods or services to a customer at an amount reflecting the consideration it expects to receive in exchange for those goods or services. Additional disclosures will be required to describe the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts. The amendments are effective for fiscal years, and interim periods within those years, beginning after December 15, 2016 and may be applied on either a full or modified retrospective basis. Early adoption is not permitted. We do not expect the adoption of these provisions to have a significant impact on the Company's consolidated financial statements. However, we will continue to assess the anticipated impact as further implementation guidance is released from the FASB. | ||||||||
In August 2014, the FASB issued ASU No. 2014-15, "Presentation of Financial Statements—Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity's Ability to Continue as a Going Concern." This ASU requires management to evaluate whether there are conditions or events that raise substantial doubt about an entity's ability to continue as a "going concern" and to provide disclosures when certain criteria are met. Substantial doubt exists when relevant conditions and events, considered in the aggregate, indicate that it is probable that the entity will be unable to meet its obligations as they become due within one year after the date that the financial statements are issued (or available to be issued). The amendments are effective for fiscal years, and interim periods within those years, beginning after December 15, 2016. Early adoption is permitted. We do not expect the adoption of these disclosures to have a significant impact on the Company's consolidated financial statements. | ||||||||
In January 2015, the FASB issued Accounting Standards Update No. 2015-01, Income Statement—Extraordinary and Unusual Items ("ASU 2015-01"). ASU 2015-01 removes the concept of extraordinary items from GAAP. Under existing guidance, an entity is required to separately disclose extraordinary items, net of tax, in the income statement after income from continuing operations if an event or transaction is of an unusual nature and occurs infrequently. This separate, net-of-tax presentation will no longer be allowed. ASU 2015-01 is effective for interim and annual reporting periods beginning after December 15, 2015. The Company does not expect the adoption of this guidance to have a material impact on its financial position, cash flows or results of operations. | ||||||||
Significant_Accounting_Policie2
Significant Accounting Policies (Tables) | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Significant Accounting Policies | ||||||||
Schedule of oil and gas properties | ||||||||
(in thousands of dollars) | 2014 | 2013 | ||||||
Mineral interests in properties | ||||||||
Unproved | $ | 94,526 | $ | 99,134 | ||||
Proved | 1,001,194 | 958,816 | ||||||
Wells and equipment and related facilities | 1,094,202 | 609,748 | ||||||
| | | | | | | | |
2,189,922 | 1,667,698 | |||||||
Less: Accumulated depletion and impairment | (551,062 | ) | (370,470 | ) | ||||
| | | | | | | | |
Net oil and gas properties | $ | 1,638,860 | $ | 1,297,228 | ||||
| | | | | | | | |
| | | | | | | | |
Schedule of other property, plant and equipment | ||||||||
(in thousands of dollars) | 2014 | 2013 | ||||||
Leasehold improvements | $ | 1,218 | $ | 1,060 | ||||
Furniture, fixtures, computers and software | 3,727 | 2,491 | ||||||
Vehicles | 988 | 835 | ||||||
Aircraft | 910 | 910 | ||||||
Other | 219 | 134 | ||||||
| | | | | | | | |
7,062 | 5,430 | |||||||
Less: Accumulated depreciation and amortization | (3,014 | ) | (1,986 | ) | ||||
| | | | | | | | |
Net other property, plant and equipment | $ | 4,048 | $ | 3,444 | ||||
| | | | | | | | |
| | | | | | | | |
Summary of the Company's ARO | ||||||||
(in thousands of dollars) | 2014 | 2013 | ||||||
ARO liability at beginning of year | $ | 10,963 | $ | 9,506 | ||||
Liabilities incurred(1) | 1,995 | 1,515 | ||||||
Accretion of discount | 770 | 608 | ||||||
Liabilities settled due to sale of related properties | (109 | ) | (271 | ) | ||||
Liabilities settled due to plugging and abandonment | (55 | ) | (702 | ) | ||||
Change in estimate | 46 | 307 | ||||||
| | | | | | | | |
ARO liability at end of year | 13,610 | 10,963 | ||||||
Less: Current portion of ARO at end of year | (3,074 | (2,590 | ||||||
) | ) | |||||||
| | | | | | | | |
Total long-term ARO at end of year | $ | 10,536 | $ | 8,373 | ||||
| | | | | | | | |
| | | | | | | | |
-1 | Includes $824 related to wells acquired in 2013 (see Note 3, "Acquisition of Properties"). | |||||||
Acquisition_of_Properties_Tabl
Acquisition of Properties (Tables) | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Sabine acquisition | ||||||||
Acquisition of Properties | ||||||||
Schedule of purchase price allocation | ||||||||
(in thousands of dollars) | ||||||||
Oil and gas properties | ||||||||
Unproved | $ | 32,964 | ||||||
Proved | 147,024 | |||||||
Asset retirement obligations | (824 | ) | ||||||
| | | | | ||||
Total purchase price | $ | 179,164 | ||||||
| | | | | ||||
| | | | | ||||
Schedule of unaudited pro forma results of operations | ||||||||
Year Ended | ||||||||
December 31, | ||||||||
Post | 2013 | |||||||
(in thousands of dollars) | Acquisition(1) | Pro Forma | ||||||
(unaudited) | (unaudited) | |||||||
Total operating revenue | $ | 1,365 | $ | 308,773 | ||||
Total operating expenses | 291 | 229,648 | ||||||
Operating income | 1,074 | 79,125 | ||||||
Net income | 1,074 | 45,778 | ||||||
-1 | Represents revenues and expenses for the post acquisition period of December 18, 2013 to December 31, 2013 included in the Consolidated Statement of Operations. | |||||||
Chalker acquisition | ||||||||
Acquisition of Properties | ||||||||
Schedule of purchase price allocation | ||||||||
(in thousands of dollars) | ||||||||
Oil and gas properties | ||||||||
Unproved | $ | 71,264 | ||||||
Proved | 182,493 | |||||||
Asset retirement obligations | (293 | ) | ||||||
| | | | | ||||
Total purchase price | $ | 253,464 | ||||||
| | | | | ||||
| | | | | ||||
Schedule of unaudited pro forma results of operations | ||||||||
Year Ended | ||||||||
December 31, | ||||||||
2012 | ||||||||
(in thousands of dollars) | Pro Forma | |||||||
(unaudited) | ||||||||
Total operating revenue | $ | 194,685 | ||||||
Total operating expenses | 161,053 | |||||||
Operating income | 33,632 | |||||||
Net income | 25,713 | |||||||
Fair_Value_Measurement_Tables
Fair Value Measurement (Tables) | 12 Months Ended | |||||||||||||
Dec. 31, 2014 | ||||||||||||||
Fair Value Measurement | ||||||||||||||
Schedule of financial instruments carried at fair value | ||||||||||||||
December 31, 2014 | ||||||||||||||
Fair Value Measurements Using | ||||||||||||||
(in thousands of dollars) | (Level 1) | (Level 2) | (Level 3) | Total | ||||||||||
Commodity Price Hedges | ||||||||||||||
Current assets | $ | — | $ | 120,604 | $ | 915 | $ | 121,519 | ||||||
Long-term assets | — | 85,162 | 1,893 | 87,055 | ||||||||||
Current liabilities | — | — | — | — | ||||||||||
Long-term liabilities | — | — | 28 | 28 | ||||||||||
December 31, 2013 | ||||||||||||||
Fair Value Measurements Using | ||||||||||||||
(in thousands of dollars) | (Level 1) | (Level 2) | (Level 3) | Total | ||||||||||
Commodity Price Hedges | ||||||||||||||
Current assets | $ | — | $ | 8,837 | $ | — | $ | 8,837 | ||||||
Long-term assets | — | 25,967 | (569 | ) | 25,398 | |||||||||
Current liabilities | — | 10,188 | 476 | 10,664 | ||||||||||
Long-term liabilities | — | — | 190 | 190 | ||||||||||
Schedule of quantitative information about Level 3 inputs used in the fair value measurement | The following table represents quantitative information about Level 3 inputs used in the fair value measurement of the Company's commodity derivative contracts as of December 31, 2014. | |||||||||||||
Quantitative Information About Level 3 Fair Value Measurements | ||||||||||||||
Commodity Price Hedges | Fair Value | Valuation Technique | Unobservable | Range | ||||||||||
(000's) | Input | |||||||||||||
Natural gas liquid swaps | $ | 3,045 | Use a discounted cash flow approach using inputs including forward price statements from counterparties | Natural gas liquid futures | $8.09 - $75.52 per barrel | |||||||||
Natural gas basis swaps | $ | (265 | ) | Use a discounted cash flow approach using inputs including forward price statements from counterparties | Natural gas basis swaps | $(0.11) - $(0.17) per barrel | ||||||||
Schedule of changes in fair value of Level 3 financial instruments | ||||||||||||||
(in thousands of dollars) | ||||||||||||||
Balance at December 31, 2012, net | $ | (1,519 | ) | |||||||||||
Purchases | (1,095 | ) | ||||||||||||
Settlements | (210 | ) | ||||||||||||
Transfers to Level 2 | (753 | ) | ||||||||||||
Changes in fair value | 2,342 | |||||||||||||
| | | | | ||||||||||
Balance at December 31, 2013, net | (1,235 | ) | ||||||||||||
Purchases | 668 | |||||||||||||
Settlements | 476 | |||||||||||||
Transfers into Level 3 | (265 | ) | ||||||||||||
Transfers to Level 2 | 332 | |||||||||||||
Changes in fair value | 2,804 | |||||||||||||
| | | | | ||||||||||
Balance at December 31, 2014, net | $ | 2,780 | ||||||||||||
| | | | | ||||||||||
| | | | | ||||||||||
Schedule of fair value of financial instruments that are not recorded at fair value in the consolidated financial statements | ||||||||||||||
December 31, 2014 | December 31, 2013 | |||||||||||||
(in thousands of dollars) | Carrying | Fair Value | Carrying | Fair Value | ||||||||||
Amount | Amount | |||||||||||||
Debt: | ||||||||||||||
Revolver | $ | 360,000 | $ | 360,000 | $ | 498,000 | $ | 498,000 | ||||||
Term loan | — | — | 160,000 | 160,000 | ||||||||||
2022 Notes | 500,000 | 384,375 | — | — | ||||||||||
Derivative_Instruments_and_Hed1
Derivative Instruments and Hedging Activities (Tables) | 12 Months Ended | ||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||
Derivative Instruments and Hedging Activities | |||||||||||||||||
Schedule of various commodity derivatives in place to offset uncertain price fluctuations that could affect the entity's future operations | |||||||||||||||||
December 31, 2014 | |||||||||||||||||
Low | High | Weighted | Final | ||||||||||||||
Average | Expiration | ||||||||||||||||
Oil swaps | Exercise price | $ | 75.05 | $ | 100.95 | $ | 84.2 | ||||||||||
Barrels per month | 45,000 | 184,054 | 113,852 | Dec-18 | |||||||||||||
Natural gas swaps | Exercise price | $ | 3.37 | $ | 6.45 | $ | 4.4 | ||||||||||
mmbtu per month | 710,000 | 1,772,584 | 1,175,275 | Dec-18 | |||||||||||||
Basis swaps | Contract differential | $ | (0.39 | ) | $ | (0.11 | ) | $ | (0.21 | ) | |||||||
mmbtu per month | 320,000 | 980,000 | 716,667 | Mar-16 | |||||||||||||
Natural gas liquids swaps | Exercise price | $ | 8.09 | $ | 95.24 | $ | 42.46 | ||||||||||
Barrels per month | 2,000 | 143,000 | 50,444 | Dec-17 | |||||||||||||
December 31, 2013 | |||||||||||||||||
Low | High | Weighted | Final | ||||||||||||||
Average | Expiration | ||||||||||||||||
Oil swaps | Exercise price | $ | 81.7 | $ | 102.84 | $ | 89.03 | ||||||||||
Barrels per month | 29,000 | 161,613 | 96,149 | Dec-17 | |||||||||||||
Natural gas swaps | Exercise price | $ | 3.88 | $ | 6.9 | $ | 4.26 | ||||||||||
mmbtu per month | 510,000 | 1,290,000 | 830,275 | Dec-17 | |||||||||||||
Basis swaps | Contract differential | $ | (0.43 | ) | $ | (0.11 | ) | $ | (0.34 | ) | |||||||
mmbtu per month | 320,000 | 690,000 | 467,037 | Mar-16 | |||||||||||||
Natural gas liquids swaps | Exercise price | $ | 6.72 | $ | 95.24 | $ | 32.98 | ||||||||||
Barrels per month | 2,000 | 118,000 | 46,646 | Dec-17 | |||||||||||||
Schedule of commodity derivative contracts that are netted on Consolidated Balance Sheet | |||||||||||||||||
(in thousands of dollars) | Gross Amounts | Gross | Net Amounts | Gross | Net Amount | ||||||||||||
of Recognized | Amounts | of Assets / | Amounts | ||||||||||||||
Assets / | Offset in the | Liabilities | Not | ||||||||||||||
Liabilities | Balance | Presented in | Offset in the | ||||||||||||||
Sheet | the Balance | Balance | |||||||||||||||
Sheet | Sheet | ||||||||||||||||
December 31, 2014 | |||||||||||||||||
Commodity derivative contracts | |||||||||||||||||
Assets | $ | 208,646 | $ | (72 | ) | $ | 208,574 | $ | — | $ | 208,574 | ||||||
Liabilities | (100 | ) | 72 | (28 | ) | — | (28 | ) | |||||||||
December 31, 2013 | |||||||||||||||||
Commodity derivative contracts | |||||||||||||||||
Assets | $ | 38,071 | $ | (6,035 | ) | $ | 32,036 | $ | 2,199 | $ | 34,235 | ||||||
Liabilities | (14,347 | ) | 6,035 | (8,312 | ) | (2,542 | ) | (10,854 | ) | ||||||||
Stockbased_Compensation_Tables
Stock-based Compensation (Tables) | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Performance Units Awards | ||||||||
Stock-based Compensation | ||||||||
Schedule of assumptions used for the Monte Carlo simulation model to determine the grant date fair value and associated compensation expense | ||||||||
The following assumptions were used for the Monte Carlo simulation model to determine the grant date fair value and associated compensation expense during the twelve months ended December 31, 2014: | ||||||||
Stock Price(1) | $ | 17.07 | ||||||
Beginning Average Stock Price(2) | $ | 14.78 | ||||||
Expected Volatility(3) | 46.95 | % | ||||||
Risk-Free Rate of Return(4) | 0.61 | % | ||||||
-1 | Based on the closing price of Jones Energy, Inc. Class A common stock on May 20, 2014. | |||||||
-2 | Based on the 10 trading days immediately prior to the beginning of the performance period. | |||||||
-3 | Based on the average historical volatilities over the most recent 2.62-year period for the Company and each peer company using daily stock prices through May 20, 2014. The measurement period reflects the 2.62 years remaining in the performance period as of the grant date. | |||||||
-4 | Based on the yield curve of U.S. Treasury rates as of May 20, 2014. | |||||||
Non-employee members of Board Of Directors | Restricted stock | ||||||||
Stock-based Compensation | ||||||||
Summary of information related to the Units/shares or awards | ||||||||
Restricted | Weighted Average | |||||||
Stock Awards | Grant Date Fair | |||||||
Value per Share | ||||||||
Unvested at January 1, 2013 | — | — | ||||||
Granted | 26,580 | $ | 15.05 | |||||
Forfeited | — | — | ||||||
Vested | — | — | ||||||
| | | | | | | | |
Unvested at December 31, 2013 | 26,580 | $ | 15.05 | |||||
Granted | 27,430 | $ | 18.77 | |||||
Forfeited | — | — | ||||||
Vested | (26,580 | ) | $ | 15.05 | ||||
| | | | | | | | |
Unvested at December 31, 2014 | 27,430 | $ | 18.77 | |||||
| | | | | | | | |
| | | | | | | | |
Officers and employees | Restricted stock | ||||||||
Stock-based Compensation | ||||||||
Summary of information related to the Units/shares or awards | ||||||||
Restricted | Weighted Average | |||||||
Stock Unit | Grant Date Fair | |||||||
Awards | Value per Share | |||||||
Unvested at January 1, 2014 | — | — | ||||||
Granted | 340,001 | $ | 17.31 | |||||
Forfeited | (13,688 | ) | $ | 17.07 | ||||
Vested | (1,416 | ) | $ | 17.07 | ||||
| | | | | | | | |
Unvested at December 31, 2014 | 324,897 | $ | 17.33 | |||||
| | | | | | | | |
| | | | | | | | |
Officers and employees | Performance Units Awards | ||||||||
Stock-based Compensation | ||||||||
Summary of information related to the Units/shares or awards | ||||||||
Performance | Weighted Average | |||||||
Unit Awards | Grant Date Fair | |||||||
Value per Share | ||||||||
Unvested at January 1, 2014 | — | — | ||||||
Granted | 201,318 | $ | 21.65 | |||||
Forfeited | (8,320 | ) | $ | 21.65 | ||||
Vested | — | — | ||||||
| | | | | | | | |
Unvested at December 31, 2014 | 192,998 | $ | 21.65 | |||||
| | | | | | | | |
| | | | | | | | |
Management incentive plan | Management units | Management | ||||||||
Stock-based Compensation | ||||||||
Summary of information related to the Units/shares or awards | ||||||||
JEH Units | Weighted Average | |||||||
Grant Date Fair | ||||||||
Value | ||||||||
per Share | ||||||||
Unvested at January 1, 2013 | 710,767 | $ | 3.62 | |||||
Granted | 911,654 | $ | 15 | |||||
Forfeited | (167,239 | ) | $ | 3.62 | ||||
Vested | (998,032 | ) | $ | 9.96 | ||||
| | | | | | | | |
Unvested at December 31, 2013 | 457,150 | $ | 12.46 | |||||
Granted | 21,405 | $ | 6.66 | |||||
Forfeited | (21,405 | ) | $ | 6.66 | ||||
Vested | (182,765 | ) | $ | 8.65 | ||||
| | | | | | | | |
Unvested at December 31, 2014 | 274,385 | $ | 15 | |||||
| | | | | | | | |
| | | | | | | | |
Earnings_per_Share_Tables
Earnings per Share (Tables) | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Earnings per Share | ||||||||
Schedule of calculation of the basic and diluted weighted-average shares and EPS | ||||||||
(in thousands, except per share data) | 2014 | 2013 | ||||||
Income (numerator): | ||||||||
Net income (loss) attributable to controlling interests | $ | 40,868 | $ | (2,186 | ) | |||
Weighted-average shares (denominator): | ||||||||
Weighted-average number of shares of Class A common stock | 12,526 | 12,500 | ||||||
| | | | | | | | |
Earnings (loss) per share: | ||||||||
Basic earnings per share | $ | 3.26 | $ | (0.17 | ) | |||
| | | | | | | | |
| | | | | | | | |
(in thousands, except per share data) | 2014 | 2013 | ||||||
Income (numerator): | ||||||||
Net income (loss) attributable to controlling interests | $ | 40,868 | $ | (2,186 | ) | |||
Weighted-average shares (denominator): | ||||||||
Weighted-average number of shares of Class A common stock | 12,535 | 12,500 | ||||||
| | | | | | | | |
Earnings (loss) per share: | ||||||||
Diluted earnings per share | $ | 3.26 | $ | (0.17 | ) | |||
| | | | | | | | |
| | | | | | | | |
Anti-dilutive shares of Class A common stock | 275 | 27 | ||||||
Commitments_and_Contingencies_
Commitments and Contingencies (Tables) | 12 Months Ended | ||||
Dec. 31, 2014 | |||||
Commitments and Contingencies | |||||
Schedule of future minimum payments for noncancellable operating leases extending beyond one year | |||||
(in thousands of dollars) | |||||
Years Ending December 31, | |||||
2015 | $ | 944 | |||
2016 | 954 | ||||
2017 | 1,038 | ||||
2018 | 1,101 | ||||
2019 | 1,122 | ||||
Thereafter | 377 | ||||
| | | | | |
$ | 5,536 | ||||
| | | | | |
| | | | | |
Income_Taxes_Tables
Income Taxes (Tables) | 12 Months Ended | ||||||||||
Dec. 31, 2014 | |||||||||||
Income Taxes | |||||||||||
Schedule of income tax provision | |||||||||||
Year Ended December 31, | |||||||||||
(in thousands of dollars) | 2014 | 2013 | 2012 | ||||||||
Current tax expense: | |||||||||||
Federal | $ | 53 | $ | 85 | $ | — | |||||
State | — | — | — | ||||||||
| | | | | | | | | | | |
Total current expense | 53 | 85 | — | ||||||||
| | | | | | | | | | | |
Deferred tax expense (benefit): | |||||||||||
Federal | 21,996 | (1,260 | ) | — | |||||||
State | 4,025 | 1,104 | 473 | ||||||||
| | | | | | | | | | | |
Total deferred expense (benefit) | 26,021 | (156 | ) | 473 | |||||||
| | | | | | | | | | | |
Total tax expense (benefit) | $ | 26,074 | $ | (71 | ) | $ | 473 | ||||
| | | | | | | | | | | |
| | | | | | | | | | | |
Tax expense (benefit) attributable to controlling interests | $ | 22,675 | $ | (1,223 | ) | $ | 473 | ||||
Tax expense attributable to non-controlling interests | 3,399 | 1,152 | — | ||||||||
| | | | | | | | | | | |
Total income tax expense (benefit) | $ | 26,074 | $ | (71 | ) | $ | 473 | ||||
| | | | | | | | | | | |
| | | | | | | | | | | |
Schedule of reconciliation of the Company's provision for income taxes as reported and the amount computed by multiplying income before taxes, less non-controlling interest, by the U.S. federal statutory rate | |||||||||||
(in thousands of dollars) | 2014 | 2013 | |||||||||
Provision calculated at federal statutory income tax rate: | |||||||||||
Net income before taxes | $ | 250,217 | $ | 22,334 | |||||||
Statutory rate | 35 | % | 35 | % | |||||||
| | | | | | | | ||||
Income tax expense computed at statutory rate | $ | 87,577 | $ | 7,817 | |||||||
Less: Non-controlling interests | (65,336 | ) | (9,009 | ) | |||||||
| | | | | | | | ||||
Income tax expense (benefit) attributable to controlling interests | 22,241 | (1,192 | ) | ||||||||
State and local income taxes, net of federal benefit | 626 | (49 | ) | ||||||||
Other | (192 | ) | 18 | ||||||||
| | | | | | | | ||||
Tax expense (benefit) attributable to controlling interests | 22,675 | (1,223 | ) | ||||||||
Tax expense attributable to non-controlling interests | 3,399 | 1,152 | |||||||||
| | | | | | | | ||||
Total income tax expense (benefit) | $ | 26,074 | $ | (71 | ) | ||||||
| | | | | | | | ||||
| | | | | | | | ||||
Schedule of significant components of the Company's deferred tax assets and deferred tax liability | |||||||||||
As of December 31, | |||||||||||
(in thousands of dollars) | 2014 | 2013 | |||||||||
Deferred tax assets | |||||||||||
Investment in consolidated subsidiary JEH | $ | — | $ | 526 | |||||||
Net operating loss | 8,223 | 649 | |||||||||
Section 754 election tax basis adjustment | 945 | — | |||||||||
Alternative minimum tax credits | 53 | 86 | |||||||||
Other deferred tax asset | 232 | 52 | |||||||||
| | | | | | | | ||||
Total deferred tax assets | 9,453 | 1,313 | |||||||||
| | | | | | | | ||||
Deferred tax liabilities | |||||||||||
Current state deferred tax liability | 718 | — | |||||||||
Investment in consolidated subsidiary JEH | 29,163 | — | |||||||||
Noncurrent state deferred tax liability | 6,731 | 3,093 | |||||||||
| | | | | | | | ||||
Total deferred tax liabilities | 36,612 | 3,093 | |||||||||
| | | | | | | | ||||
Net deferred tax assets (liabilities) | (27,159 | ) | (1,780 | ) | |||||||
Valuation allowance | — | — | |||||||||
| | | | | | | | ||||
Net deferred tax assets (liabilities) | $ | (27,159 | ) | $ | (1,780 | ) | |||||
| | | | | | | | ||||
| | | | | | | | ||||
Condensed_Consolidating_Financ
Condensed Consolidating Financial Statements (Tables) | 12 Months Ended | |||||||||||||||||||
Dec. 31, 2014 | ||||||||||||||||||||
Subsidiary Guarantors | ||||||||||||||||||||
Condensed Consolidating Balance Sheet | ||||||||||||||||||||
Condensed Consolidating Balance Sheet | ||||||||||||||||||||
December 31, 2014 | ||||||||||||||||||||
(in thousands of dollars) | JEI (Parent) | Issuers | Guarantor | Non- | Eliminations | Consolidated | ||||||||||||||
Subsidiaries | Guarantor | |||||||||||||||||||
Subsidiaries | ||||||||||||||||||||
Assets | ||||||||||||||||||||
Current assets | ||||||||||||||||||||
Cash | $ | 100 | $ | 1,000 | $ | 12,436 | $ | 30 | $ | — | $ | 13,566 | ||||||||
Restricted cash | — | — | 149 | — | — | 149 | ||||||||||||||
Accounts receivable, net | ||||||||||||||||||||
Oil and gas sales | — | — | 49,861 | — | — | 49,861 | ||||||||||||||
Joint interest owners | — | — | 41,761 | — | — | 41,761 | ||||||||||||||
Other | 102 | 8,788 | 3,622 | — | — | 12,512 | ||||||||||||||
Commodity derivative assets | — | 121,519 | — | — | — | 121,519 | ||||||||||||||
Other current assets | — | 451 | 2,923 | — | — | 3,374 | ||||||||||||||
Intercompany receivable | 4,164 | 1,205,608 | — | (2,328 | ) | (1,207,444 | ) | — | ||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Total current assets | 4,366 | 1,337,366 | 110,752 | (2,298 | ) | (1,207,444 | ) | 242,742 | ||||||||||||
Oil and gas properties, net, at cost under the successful efforts method | — | — | 1,638,860 | — | — | 1,638,860 | ||||||||||||||
Other property, plant and equipment, net | — | — | 3,252 | 796 | — | 4,048 | ||||||||||||||
Commodity derivative assets | — | 87,055 | — | — | — | 87,055 | ||||||||||||||
Other assets | — | 20,098 | 254 | — | — | 20,352 | ||||||||||||||
Deferred tax assets | 171 | — | — | — | — | 171 | ||||||||||||||
Investment in subsidiaries | 231,866 | — | — | — | (231,866 | ) | — | |||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Total assets | $ | 236,403 | $ | 1,444,519 | $ | 1,753,118 | $ | (1,502 | ) | $ | (1,439,310 | ) | $ | 1,993,228 | ||||||
| | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
Liabilities and Stockholders' Equity | ||||||||||||||||||||
Current liabilities | ||||||||||||||||||||
Trade accounts payable | $ | — | $ | 288 | $ | 136,049 | $ | — | $ | — | $ | 136,337 | ||||||||
Oil and gas sales payable | — | — | 70,469 | — | — | 70,469 | ||||||||||||||
Accrued liabilities | — | 8,914 | 10,487 | — | — | 19,401 | ||||||||||||||
Deferred tax liabilities | — | 718 | — | — | — | 718 | ||||||||||||||
Asset retirement obligations | — | — | 3,074 | — | — | 3,074 | ||||||||||||||
Intercompany payable | — | — | 1,209,630 | — | (1,209,630 | ) | — | |||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Total current liabilities | — | 9,920 | 1,429,709 | — | (1,290,630 | ) | 229,999 | |||||||||||||
Long-term debt | — | 360,000 | — | — | — | 360,000 | ||||||||||||||
Senior notes | — | 500,000 | — | — | — | 500,000 | ||||||||||||||
Deferred revenue | — | 13,377 | — | — | — | 13,377 | ||||||||||||||
Commodity derivative liabilities | — | 28 | — | — | — | 28 | ||||||||||||||
Asset retirement obligations | — | — | 10,536 | — | — | 10,536 | ||||||||||||||
Liability under tax receivable agreement | 803 | — | — | — | — | 803 | ||||||||||||||
Deferred tax liabilities | 20,093 | 6,519 | — | — | — | 26,612 | ||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Total liabilities | 20,896 | 889,844 | 1,440,245 | — | (1,209,630 | ) | 1,141,355 | |||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Stockholders' / members' equity | ||||||||||||||||||||
Members' equity | — | 554,675 | 312,873 | (1,502 | ) | (866,046 | ) | — | ||||||||||||
Class A common stock, $0.001 par value; 12,672,260 shares issued and 12,649,658 shares outstanding | 13 | — | — | — | — | 13 | ||||||||||||||
Class B common stock, $0.001 par value; 36,719,499 shares issued and outstanding | 37 | — | — | — | — | 37 | ||||||||||||||
Treasury stock, at cost; 22,602 shares | (358 | ) | — | — | — | — | (358 | ) | ||||||||||||
Additional paid-in-capital | 177,133 | — | — | — | — | 177,133 | ||||||||||||||
Retained earnings | 38,682 | — | — | — | — | 38,682 | ||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Stockholders' equity | 215,507 | 554,675 | 312,873 | (1,502 | ) | (866,046 | ) | 215,507 | ||||||||||||
Non-controlling interest | — | — | — | — | 636,366 | 636,366 | ||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Total stockholders' equity | 215,507 | 554,675 | 312,873 | (1,502 | ) | (229,680 | ) | 851,873 | ||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Total liabilities and stockholders' equity | $ | 236,403 | $ | 1,444,519 | $ | 1,753,118 | $ | (1,502 | ) | $ | (1,439,310 | ) | $ | 1,993,228 | ||||||
| | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
Condensed Consolidating Balance Sheet | ||||||||||||||||||||
December 31, 2013 | ||||||||||||||||||||
(in thousands of dollars) | JEI (Parent) | Issuers | Guarantor | Non-Guarantor | Eliminations | Consolidated | ||||||||||||||
Subsidiaries | Subsidiaries | |||||||||||||||||||
Assets | ||||||||||||||||||||
Current assets | ||||||||||||||||||||
Cash | $ | 100 | $ | 6,000 | $ | 17,650 | $ | 70 | $ | — | $ | 23,820 | ||||||||
Restricted cash | — | — | 45 | — | — | 45 | ||||||||||||||
Accounts receivable, net | ||||||||||||||||||||
Oil and gas sales | — | — | 51,233 | — | — | 51,233 | ||||||||||||||
Joint interest owners | — | — | 42,481 | — | — | 42,481 | ||||||||||||||
Other | — | — | 16,782 | — | — | 16,782 | ||||||||||||||
Commodity derivative assets | — | 8,837 | — | — | — | 8,837 | ||||||||||||||
Other current assets | — | 387 | 2,005 | — | — | 2,392 | ||||||||||||||
Deferred tax assets | — | 12 | — | — | — | 12 | ||||||||||||||
Intercompany receivable | 638 | 1,051,389 | — | (1,052,027 | ) | — | ||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Total current assets | 738 | 1,066,625 | 130,196 | 70 | (1,052,027 | ) | 145,602 | |||||||||||||
Oil and gas properties, net, at cost under the successful efforts method | — | — | 1,297,228 | — | — | 1,297,228 | ||||||||||||||
Other property, plant and equipment, net | — | — | 2,557 | 887 | — | 3,444 | ||||||||||||||
Commodity derivative assets | — | 25,398 | — | — | — | 25,398 | ||||||||||||||
Other assets | — | 14,072 | 934 | — | — | 15,006 | ||||||||||||||
Investment in subsidiaries | 169,081 | — | — | — | (169,081 | ) | — | |||||||||||||
Deferred tax assets | 1,301 | — | — | — | — | 1,301 | ||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Total assets | $ | 171,120 | $ | 1,106,095 | $ | 1,430,915 | $ | 957 | $ | (1,221,108 | ) | $ | 1,487,979 | |||||||
| | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
Liabilities and Stockholders' Equity | ||||||||||||||||||||
Current liabilities | ||||||||||||||||||||
Trade accounts payable | $ | — | $ | 230 | $ | 89,200 | $ | — | $ | — | $ | 89,430 | ||||||||
Oil and gas sales payable | — | — | 66,179 | — | — | 66,179 | ||||||||||||||
Accrued liabilities | 87 | 1,642 | 9,076 | — | — | 10,805 | ||||||||||||||
Commodity derivative liabilities | — | 10,664 | — | — | — | 10,664 | ||||||||||||||
Asset retirement obligations | — | — | 2,590 | — | — | 2,590 | ||||||||||||||
Intercompany payable | — | — | 1,051,935 | 2,279 | (1,054,214 | ) | — | |||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Total current liabilities | 87 | 12,536 | 1,218,980 | 2,279 | (1,054,214 | ) | 179,668 | |||||||||||||
Long-term debt | — | 658,000 | — | — | — | 658,000 | ||||||||||||||
Deferred revenue | — | 14,531 | — | — | — | 14,531 | ||||||||||||||
Commodity derivative liabilities | — | 190 | — | — | — | 190 | ||||||||||||||
Asset retirement obligations | — | — | 8,373 | — | — | 8,373 | ||||||||||||||
Deferred tax liabilities | — | 3,093 | — | — | — | 3,093 | ||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Total liabilities | 87 | 688,350 | 1,227,353 | 2,279 | (1,054,214 | ) | 863,855 | |||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Stockholders' / members' equity | ||||||||||||||||||||
Members' equity | — | 417,745 | 203,562 | (1,322 | ) | (619,985 | ) | — | ||||||||||||
Class A common stock, $0.001 par value; 12,526,580 shares issued and outstanding | 13 | — | — | — | — | 13 | ||||||||||||||
Class B common stock, $0.001 par value; 36,836,333 shares issued and outstanding | 37 | — | — | — | — | 37 | ||||||||||||||
Additional paid-in-capital | 173,169 | — | — | — | — | 173,169 | ||||||||||||||
Retained earnings (deficit) | (2,186 | ) | — | — | — | — | (2,186 | ) | ||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Stockholders' equity | 171,033 | 417,745 | 203,562 | (1,322 | ) | (619,985 | ) | 171,033 | ||||||||||||
Non-controlling interest | — | — | — | — | 453,091 | 453,091 | ||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Total stockholders' equity | 171,033 | 417,745 | 203,562 | (1,322 | ) | (166,894 | ) | 624,124 | ||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Total liabilities and stockholders' equity | $ | 171,120 | $ | 1,106,095 | $ | 1,430,915 | $ | 957 | $ | (1,221,108 | ) | $ | 1,487,979 | |||||||
| | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
Condensed Consolidating Statements of Operations | ||||||||||||||||||||
Condensed Consolidating Statement of Operations and Comprehensive Income | ||||||||||||||||||||
Year Ended December 31, 2014 | ||||||||||||||||||||
(in thousands) | JEI (Parent) | Issuers | Guarantor | Non- | Eliminations | Consolidated | ||||||||||||||
Subsidiaries | Guarantor | |||||||||||||||||||
Subsidiaries | ||||||||||||||||||||
Operating revenues | ||||||||||||||||||||
Oil and gas sales | $ | — | $ | — | $ | 378,401 | $ | — | $ | — | $ | 378,401 | ||||||||
Other revenues | — | 1,154 | 1,042 | — | — | 2,196 | ||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Total operating revenues | — | 1,154 | 379,443 | — | — | 380,597 | ||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Operating costs and expenses | ||||||||||||||||||||
Lease operating | — | — | 43,843 | — | — | 43,843 | ||||||||||||||
Production taxes | — | — | 18,094 | — | — | 18,094 | ||||||||||||||
Exploration | — | — | 3,453 | — | — | 3,453 | ||||||||||||||
Depletion, depreciation and amortization | — | — | 181,578 | 91 | — | 181,669 | ||||||||||||||
Accretion of discount | — | — | 770 | — | — | 770 | ||||||||||||||
General and administrative (including non-cash compensation expense) | — | 4,494 | 21,180 | 89 | — | 25,763 | ||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Total operating expenses | — | 4,494 | 268,918 | 180 | — | 273,592 | ||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Operating income | — | (3,340 | ) | 110,525 | (180 | ) | — | 107,005 | ||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Other income (expense) | ||||||||||||||||||||
Interest expense | — | (45,215 | ) | (1,511 | ) | — | — | (46,726 | ) | |||||||||||
Net gain on commodity derivatives | — | 189,641 | — | — | — | 189,641 | ||||||||||||||
Gain on sales of assets | — | — | 297 | — | — | 297 | ||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Other income (expense), net | — | 144,426 | (1,214 | ) | — | — | 143,212 | |||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Income (loss) before income tax | — | 141,086 | 109,311 | (180 | ) | — | 250,217 | |||||||||||||
Equity interest in income | 62,785 | (62,785 | ||||||||||||||||||
— | — | — | ) | — | ||||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Income tax provision | ||||||||||||||||||||
Current | 53 | 53 | ||||||||||||||||||
Deferred | 21,864 | 4,157 | 26,021 | |||||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Total income tax provision | 21,917 | 4,157 | — | — | — | 26,074 | ||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Net income (loss) | 40,868 | 136,929 | 109,311 | (180 | ) | (62,785 | ) | 224,143 | ||||||||||||
Net income attributable to non-controlling interests | — | — | — | — | 183,275 | 183,275 | ||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Net income attributable to controlling interests | $ | 40,868 | — | — | — | — | $ | 40,868 | ||||||||||||
| | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
Condensed Consolidating Statement of Operations and Comprehensive Income | ||||||||||||||||||||
Year Ended December 31, 2013 | ||||||||||||||||||||
(in thousands) | JEI (Parent) | Issuers | Guarantor | Non- | Eliminations | Consolidated | ||||||||||||||
Subsidiaries | Guarantor | |||||||||||||||||||
Subsidiaries | ||||||||||||||||||||
Operating revenues | ||||||||||||||||||||
Oil and gas sales | $ | — | $ | — | $ | 258,063 | $ | — | $ | — | $ | 258,063 | ||||||||
Other revenues | — | 469 | 637 | — | — | 1,106 | ||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Total operating revenues | — | 469 | 258,700 | — | — | 259,169 | ||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Operating costs and expenses | ||||||||||||||||||||
Lease operating | — | — | 27,781 | — | — | 27,781 | ||||||||||||||
Production taxes | — | — | 12,865 | — | — | 12,865 | ||||||||||||||
Exploration | — | — | 1,710 | — | — | 1,710 | ||||||||||||||
Depletion, depreciation and amortization | — | — | 114,046 | 90 | — | 114,136 | ||||||||||||||
Impairment of oil and gas properties | — | — | 14,415 | — | — | 14,415 | ||||||||||||||
Accretion of discount | — | — | 608 | — | — | 608 | ||||||||||||||
General and administrative (including non-cash compensation expense) | — | 4,154 | 27,490 | 258 | — | 31,902 | ||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Total operating expenses | — | 4,154 | 198,915 | 348 | — | 203,417 | ||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Operating income | — | (3,685 | ) | 59,785 | (348 | ) | — | 55,752 | ||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Other income (expense) | ||||||||||||||||||||
Interest expense | — | (29,653 | ) | (1,121 | ) | — | — | (30,774 | ) | |||||||||||
Net gain (loss) on commodity derivatives | — | (2,566 | ) | — | — | — | (2,566 | ) | ||||||||||||
Gain (loss) on sales of assets | — | — | 41 | (119 | ) | — | (78 | ) | ||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Other income (expense), net | — | (32,219 | ) | (1,080 | ) | (119 | ) | — | (33,418 | ) | ||||||||||
| | | | | | | | | | | | | | | | | | | | |
Income (loss) before income tax | — | (35,904 | ) | 58,705 | (467 | ) | — | 22,334 | ||||||||||||
Equity interest in income | (3,400 | 3,400 | ||||||||||||||||||
) | — | — | — | — | ||||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Income tax provision (benefit) | ||||||||||||||||||||
Current | 85 | — | — | — | 85 | |||||||||||||||
Deferred | (1,299 | ) | 1,143 | — | — | — | (156 | ) | ||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Total income tax provision (benefit) | (1,214 | ) | 1,143 | — | — | — | (71 | ) | ||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Net income (loss) | (2,186 | ) | (37,047 | ) | 58,705 | (467 | ) | 3,400 | 22,405 | |||||||||||
Net income attributable to non-controlling interests | — | — | — | — | 24,591 | 24,591 | ||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Net income (loss) attributable to controlling interests | $ | (2,186 | ) | — | — | — | — | $ | (2,186 | ) | ||||||||||
| | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
Condensed Statements of Cash Flows | ||||||||||||||||||||
Condensed Consolidating Statement of Cash Flows | ||||||||||||||||||||
Year Ended December 31, 2014 | ||||||||||||||||||||
(in thousands of dollars) | JEI (Parent) | Issuers | Guarantor | Non- | Eliminations | Consolidated | ||||||||||||||
Subsidiaries | Guarantor | |||||||||||||||||||
Subsidiaries | ||||||||||||||||||||
Cash flows from operating activities | ||||||||||||||||||||
Net income (loss) | $ | 40,868 | $ | 136,929 | $ | 109,311 | $ | (180 | ) | $ | (62,785 | ) | $ | 224,143 | ||||||
Adjustments to reconcile net income (loss) to net cash provided by operating activities | (40,510 | ) | (326,859 | ) | 345,724 | 140 | 62,785 | 41,280 | ||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Net cash (used in) / provided by operations | 358 | (189,930 | ) | 455,035 | (40 | ) | — | 265,423 | ||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Cash flows from investing activities | ||||||||||||||||||||
Additions to oil and gas properties | — | — | (474,619 | ) | — | — | (474,619 | ) | ||||||||||||
Net adjustments to purchase price of properties acquired | — | — | 15,709 | — | — | 15,709 | ||||||||||||||
Proceeds from sales of assets | — | — | 448 | — | — | 448 | ||||||||||||||
Acquisition of other property, plant and equipment | — | — | (1,683 | ) | — | — | (1,683 | ) | ||||||||||||
Current period settlements of matured derivative contracts | — | (3,654 | ) | — | — | — | (3,654 | ) | ||||||||||||
Change in restricted cash | — | — | (104 | ) | — | — | (104 | ) | ||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Net cash (used in) / provided by investing | — | (3,654 | ) | (460,249 | ) | — | — | (463,903 | ) | |||||||||||
| | | | | | | | | | | | | | | | | | | | |
Cash flows from financing activities | ||||||||||||||||||||
Proceeds from issuance of long-term debt | — | 170,000 | — | — | — | 170,000 | ||||||||||||||
Repayment under long-term debt | — | (468,000 | ) | — | — | — | (468,000 | ) | ||||||||||||
Proceeds from senior notes | — | 500,000 | — | — | — | 500,000 | ||||||||||||||
Payment of debt issuance costs | — | (13,416 | ) | — | — | — | (13,416 | ) | ||||||||||||
Purchase of treasury stock | (358 | ) | — | — | — | — | (358 | ) | ||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Net cash (used in) / provided by financing | (358 | ) | 188,584 | — | — | — | 188,226 | |||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Net increase (decrease) in cash | — | (5,000 | ) | (5,214 | ) | (40 | ) | — | (10,254 | ) | ||||||||||
Cash | ||||||||||||||||||||
Beginning of period | 100 | 6,000 | 17,650 | 70 | — | 23,820 | ||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
End of period | $ | 100 | $ | 1,000 | $ | 12,436 | $ | 30 | $ | — | $ | 13,566 | ||||||||
| | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
Condensed Consolidating Statement of Cash Flows | ||||||||||||||||||||
Year Ended December 31, 2013 | ||||||||||||||||||||
(in thousands of dollars) | JEI (Parent) | Issuers | Guarantor | Non- | Eliminations | Consolidated | ||||||||||||||
Subsidiaries | Guarantor | |||||||||||||||||||
Subsidiaries | ||||||||||||||||||||
Cash flows from operating activities | ||||||||||||||||||||
Net income (loss) | $ | (2,186 | ) | $ | (37,047 | ) | $ | 58,705 | $ | (467 | ) | $ | 3,400 | $ | 22,405 | |||||
Adjustments to reconcile net income (loss) to net cash provided by operating activities | 2,286 | (189,393 | ) | 315,942 | 733 | (3,400 | ) | 126,168 | ||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Net cash (used in) / provided by operations | 100 | (226,440 | ) | 374,647 | 266 | — | 148,573 | |||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Cash flows from investing activities | ||||||||||||||||||||
Investment in subsidiary | (172,481 | ) | — | — | — | 172,481 | — | |||||||||||||
Additions to oil and gas properties | — | — | (197,618 | ) | — | — | (197,618 | ) | ||||||||||||
Acquisition of properties | — | — | (178,173 | ) | — | — | (178,173 | ) | ||||||||||||
Proceeds from sales of assets | — | — | 963 | 644 | — | 1,607 | ||||||||||||||
Acquisition of other property, plant and equipment | — | — | (724 | ) | (910 | ) | — | (1,634 | ) | |||||||||||
Current period settlements of matured derivative contracts | — | 7,586 | — | — | — | 7,586 | ||||||||||||||
Change in restricted cash | — | — | (45 | ) | — | — | (45 | ) | ||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Net cash (used in) / provided by investing | (172,481 | ) | 7,586 | (375,597 | ) | (266 | ) | 172,481 | (368,277 | ) | ||||||||||
| | | | | | | | | | | | | | | | | | | | |
Cash flows from financing activities | ||||||||||||||||||||
Proceeds from investment in JEI | — | 172,481 | — | — | (172,481 | ) | — | |||||||||||||
Proceeds from issuance of long-term debt | — | 220,000 | — | — | 220,000 | |||||||||||||||
Repayment under long-term debt | — | (172,000 | ) | — | — | (172,000 | ) | |||||||||||||
Payment of debt issuance costs | — | (683 | ) | — | — | (683 | ) | |||||||||||||
Proceeds from sale of common stock, net of expenses of $15.1 million | 172,481 | — | — | — | 172,481 | |||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Net cash (used in) / provided by financing | 172,481 | 219,798 | — | — | (172,481 | ) | 219,798 | |||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Net increase (decrease) in cash | 100 | 944 | (950 | ) | — | — | 94 | |||||||||||||
Cash | ||||||||||||||||||||
Beginning of period | — | 5,056 | 18,600 | 70 | — | 23,726 | ||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
End of period | $ | 100 | $ | 6,000 | $ | 17,650 | $ | 70 | $ | — | $ | 23,820 | ||||||||
| | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
Organization_and_Description_o1
Organization and Description of Business (Details) | 12 Months Ended | 0 Months Ended | |
Dec. 31, 2014 | Jul. 29, 2013 | Jul. 29, 2014 | |
item | item | ||
Organization and description of business | |||
Number of classes of common stock | 2 | ||
Number of distinct basins where entity's assets are located | 2 | ||
Number of industry segments | 1 | ||
Number of geographic areas in which the entity operates | 1 | ||
Existing Owners | |||
Organization and description of business | |||
Exchange ratio | 1 | 1 | |
Number of votes for each holder of common stock | 1 | ||
JEH | |||
Organization and description of business | |||
Economic interest (as a percent) | 74.70% |
Significant_Accounting_Policie3
Significant Accounting Policies (Details) (USD $) | 12 Months Ended |
Dec. 31, 2014 | |
item | |
Segment Information | |
Number of Operating Segments | 1 |
Number of Geographic Areas in which Entity Operates | 1 |
Accounts Receivable | |
Payment period of oil and gas sales, Minimum | 30 days |
Payment period of oil and gas sales, Maximum | 60 days |
Period within which joint interest owner obligations becomes due | 30 days |
Interest charged on past-due balances | $0 |
Significant_Accounting_Policie4
Significant Accounting Policies (Details 2) (Credit risk) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
item | item | |
Accounts receivable - Oil and gas sales | ||
Concentration of Risk | ||
Concentration risk (as a percent) | 70.00% | 79.00% |
Number of customers | 5 | 8 |
Accounts receivable - Joint interest owners | ||
Concentration of Risk | ||
Concentration risk (as a percent) | 67.00% | 77.00% |
Number of customers | 5 | 5 |
Significant_Accounting_Policie5
Significant Accounting Policies (Details 3) (Oil and gas sales) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
PVR Midstream | |||
Dependence on Major Customers | |||
Concentration risk (as a percent) | 22.00% | 15.00% | 18.00% |
Unimark LLC | |||
Dependence on Major Customers | |||
Concentration risk (as a percent) | 12.00% | 13.00% | 24.00% |
Mercuria | |||
Dependence on Major Customers | |||
Concentration risk (as a percent) | 12.00% | 13.00% | 18.00% |
Valero Marketing | |||
Dependence on Major Customers | |||
Concentration risk (as a percent) | 10.00% | 13.00% | |
Plains Marketing | |||
Dependence on Major Customers | |||
Concentration risk (as a percent) | 10.00% | 6.00% | 15.00% |
Significant_Accounting_Policie6
Significant Accounting Policies (Details 4) (USD $) | 3 Months Ended | 12 Months Ended | |||
Dec. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
item | MMBoe | MMBoe | |||
Boe | |||||
Mineral interests in properties | |||||
Unproved | $99,134,000 | $94,526,000 | $94,526,000 | $99,134,000 | |
Proved | 958,816,000 | 1,001,194,000 | 1,001,194,000 | 958,816,000 | |
Wells and equipment and related facilities | 609,748,000 | 1,094,202,000 | 1,094,202,000 | 609,748,000 | |
Gross oil and gas properties | 1,667,698,000 | 2,189,922,000 | 2,189,922,000 | 1,667,698,000 | |
Less: Accumulated depletion and impairment | -370,470,000 | -551,062,000 | -551,062,000 | -370,470,000 | |
Net oil and gas properties | 1,297,228,000 | 1,638,860,000 | 1,638,860,000 | 1,297,228,000 | |
Costs capitalized in connection with exploratory wells | 0 | 0 | |||
Minimum project period for capitalization of interest on expenditures | 6 months | 6 months | |||
Number of projects for which interest on expenditure is capitalized | 0 | 0 | |||
Amount of capitalized interest on expenditures | 100,000 | ||||
Number of cubic feet of gas considered as numerator in calculation of unit conversion ratio | 6,000 | 1.4 | 0.8 | ||
Depletion of oil and gas properties | 180,600,000 | 113,300,000 | 79,900,000 | ||
Impairment of proved properties | 0 | 0 | 18,800,000 | ||
Impairment of unproved properties | $14,400,000 | $0 | $0 |
Significant_Accounting_Policie7
Significant Accounting Policies (Details 5) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Other Property, Plant and Equipment | |||
Gross other property, plant and equipment | $7,062,000 | $5,430,000 | |
Less: Accumulated depreciation and amortization | -3,014,000 | -1,986,000 | |
Net other property, plant and equipment | 4,048,000 | 3,444,000 | |
Depreciation and amortization of other property, plant and equipment | 1,100,000 | 800,000 | 800,000 |
Minimum | |||
Other Property, Plant and Equipment | |||
Estimated useful lives | 3 years | ||
Maximum | |||
Other Property, Plant and Equipment | |||
Estimated useful lives | 10 years | ||
Leasehold improvements | |||
Other Property, Plant and Equipment | |||
Gross other property, plant and equipment | 1,218,000 | 1,060,000 | |
Furniture, fixtures, computers and software | |||
Other Property, Plant and Equipment | |||
Gross other property, plant and equipment | 3,727,000 | 2,491,000 | |
Vehicles | |||
Other Property, Plant and Equipment | |||
Gross other property, plant and equipment | 988,000 | 835,000 | |
Aircraft | |||
Other Property, Plant and Equipment | |||
Gross other property, plant and equipment | 910,000 | 910,000 | |
Other | |||
Other Property, Plant and Equipment | |||
Gross other property, plant and equipment | $219,000 | $134,000 |
Significant_Accounting_Policie8
Significant Accounting Policies (Detail 6) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Oil and Gas Sales Payable | |||
Period of remittance for oil and gas sales payable | 60 days | ||
Asset Retirement Obligations | |||
ARO liability at beginning of year | $10,963,000 | $10,963,000 | $9,506,000 |
Liabilities incurred | 1,995,000 | 1,516,000 | 662,000 |
Accretion of discount | 770,000 | 608,000 | |
Liabilities settled due to sale of related properties | -109,000 | -271,000 | |
Liabilities settled due to plugging and abandonment | -55,000 | -702,000 | |
Change in estimate | 46,000 | 307,000 | |
ARO liability at end of year | 13,610,000 | 10,963,000 | 10,963,000 |
Less: Current portion of ARO at end of year | -3,074,000 | -2,590,000 | |
Total long-term ARO at end of year | 10,536,000 | 8,373,000 | |
Liabilities incurred related to wells acquired | 824,000 | ||
Liability under Tax Receivable Agreement | |||
Cash savings to be paid under tax receivable agreement with JEH and the pre-IPO owners (as a percent) | 85.00% | ||
Benefits of cash savings retained under tax receivable agreement (as a percent) | 15.00% | ||
Liabilities recorded | 0 | ||
Future Tax Benefits | 900,000 | ||
Liability under tax receivable agreement | $800,000 |
Significant_Accounting_Policie9
Significant Accounting Policies (Details 7) (USD $) | 1 Months Ended | 12 Months Ended | 0 Months Ended | |||
In Millions, unless otherwise specified | Sep. 30, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Sep. 01, 2013 | 7-May-13 |
Boe | MMBoe | |||||
Related Party Transactions | ||||||
Production of natural gas and NGLs from the Chalker properties (in MMBoe) | 6,000 | 0.8 | ||||
Reserved capacity (in barrels per day) | 12,000 | |||||
Metalmark | ||||||
Related Party Transactions | ||||||
Annual administration fee | 0.7 | $0.70 | ||||
Number of directors who are managing directors of the related party | 2 | |||||
Metalmark | Minimum | ||||||
Related Party Transactions | ||||||
Outstanding equity interests held by the related party (as a percent) | 5.00% | |||||
Monarch | ||||||
Related Party Transactions | ||||||
Initial term of the agreement | 10 years | |||||
Term of Oil Gathering and Transportation Agreement | 10 years | |||||
Monarch | Metalmark | ||||||
Related Party Transactions | ||||||
Outstanding equity interests held (as a percent) | 81.00% | |||||
JEH | ||||||
Related Party Transactions | ||||||
Value of equity interests assigned to Jonny Jones | 2.4 | |||||
Value of equity interests reserved to a benefit plan established for certain of the entity's officers | 2.6 | |||||
Value of remaining equity interests distributed to certain of the pre-IPO owners | 10 | |||||
JEH | Monarch | ||||||
Related Party Transactions | ||||||
Deemed value of equity interests issued | $15 |
Recovered_Sheet1
Significant Accounting Policies (Details 8) | 1 Months Ended | 12 Months Ended | 0 Months Ended | 12 Months Ended |
31-May-14 | Dec. 31, 2014 | Sep. 23, 2014 | Dec. 31, 2013 | |
Performance Units Awards | ||||
Stock Compensation | ||||
Performance period of shareholder return | 3 years | |||
Stock-based Compensation expensed recognition period | 3 years | |||
Performance Units Awards | Minimum | ||||
Stock Compensation | ||||
Number of shares of common stock issuable upon vesting of the performance share awards (as a percent) | 0.00% | 0.00% | ||
Performance Units Awards | Maximum | ||||
Stock Compensation | ||||
Number of shares of common stock issuable upon vesting of the performance share awards (as a percent) | 200.00% | 200.00% | ||
Management incentive plan | JEH | Management units | Single vesting | ||||
Stock Compensation | ||||
Vesting term | 5 years | |||
2013 Omnibus Incentive Plan | Class A common stock | ||||
Stock Compensation | ||||
Shares reserved (in shares) | 3,850,000 | |||
2013 Omnibus Incentive Plan | Restricted stock | ||||
Stock Compensation | ||||
Vesting term | 1 year | |||
Awards granted, per outside member of the Board of Directors (in shares) | 5,486 | 6,645 |
Acquisition_of_Properties_Deta
Acquisition of Properties (Details) (USD $) | 12 Months Ended | 0 Months Ended | 3 Months Ended | ||||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 20, 2012 | Dec. 18, 2013 | Jun. 30, 2014 | |
item | |||||||
Acquisition of Properties | |||||||
Number of property acquisitions | 0 | ||||||
Post Acquisition | |||||||
Total operating revenues | $380,597,000 | $259,169,000 | $149,814,000 | ||||
Total operating expenses | 273,592,000 | 203,417,000 | 144,974,000 | ||||
Operating income | 107,005,000 | 55,752,000 | 4,840,000 | ||||
Net income | 40,868,000 | -2,186,000 | -3,079,000 | ||||
Earnings per share, basic (in dollars per share) | $3.26 | ($0.17) | |||||
Earnings per share, diluted (in dollars per share) | $3.26 | ($0.17) | |||||
Sabine acquisition | |||||||
Oil and gas properties | |||||||
Unproved | 32,964,000 | ||||||
Proved | 147,024,000 | ||||||
Asset retirement obligations | -824,000 | ||||||
Total purchase price | 179,164,000 | ||||||
Post Acquisition | |||||||
Total operating revenues | 1,365,000 | ||||||
Total operating expenses | 291,000 | ||||||
Operating income | 1,074,000 | ||||||
Net income | 45,778,000 | 1,074,000 | |||||
Pro Forma | |||||||
Total operating revenue | 308,773,000 | ||||||
Total operating expenses | 229,648,000 | ||||||
Operating income | 79,125,000 | ||||||
Chalker acquisition | |||||||
Acquisition of Properties | |||||||
Purchase price | 251,900,000 | ||||||
Oil and gas properties | |||||||
Unproved | 71,264,000 | ||||||
Proved | 182,493,000 | ||||||
Asset retirement obligations | -293,000 | ||||||
Total purchase price | 253,464,000 | ||||||
Pro Forma | |||||||
Total operating revenue | 194,685,000 | ||||||
Total operating expenses | 161,053,000 | ||||||
Operating income | 33,632,000 | ||||||
Net income | 25,713,000 | ||||||
Oil and natural gas properties located in Oklahoma | |||||||
Acquisition of Properties | |||||||
Purchase price | 193,500,000 | 179,200,000 | |||||
JEI (Parent) | |||||||
Post Acquisition | |||||||
Net income | $40,868,000 | ($2,186,000) |
Fair_Value_Measurement_Details
Fair Value Measurement (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Fair Value Measurements | ||
Current assets | $121,519 | $8,837 |
Long-term assets | 87,055 | 25,398 |
Current liabilities | 10,664 | |
Long-term liabilities | 28 | 190 |
Level 2 | Commodity Price Hedges | ||
Fair Value Measurements | ||
Current assets | 120,604 | 8,837 |
Long-term assets | 85,162 | 25,967 |
Current liabilities | 10,188 | |
Level 3 | Commodity Price Hedges | ||
Fair Value Measurements | ||
Current assets | 915 | |
Long-term assets | 1,893 | -569 |
Current liabilities | 476 | |
Long-term liabilities | 28 | 190 |
Fair Value | Commodity Price Hedges | ||
Fair Value Measurements | ||
Current assets | 121,519 | 8,837 |
Long-term assets | 87,055 | 25,398 |
Current liabilities | 10,664 | |
Long-term liabilities | $28 | $190 |
Fair_Value_Measurement_Details1
Fair Value Measurement (Details 2) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Natural gas liquids | Swaps | Minimum | ||
Quantitative Information About Level 3 Fair Value Measurements | ||
Swap price (in dollars per barrel/mmbtu) | 8.09 | 6.72 |
Natural gas liquids | Swaps | Maximum | ||
Quantitative Information About Level 3 Fair Value Measurements | ||
Swap price (in dollars per barrel/mmbtu) | 95.24 | 95.24 |
Commodity Price Hedges | ||
Quantitative Information About Level 3 Fair Value Measurements | ||
Fair Value | $100 | $14,347 |
Discounted cash flow approach | Level 3 | Commodity Price Hedges | Natural gas liquids | Swaps | ||
Quantitative Information About Level 3 Fair Value Measurements | ||
Fair Value | 3,045 | |
Discounted cash flow approach | Level 3 | Commodity Price Hedges | Natural gas liquids | Swaps | Minimum | ||
Quantitative Information About Level 3 Fair Value Measurements | ||
Swap price (in dollars per barrel/mmbtu) | 8.09 | |
Discounted cash flow approach | Level 3 | Commodity Price Hedges | Natural gas liquids | Swaps | Maximum | ||
Quantitative Information About Level 3 Fair Value Measurements | ||
Swap price (in dollars per barrel/mmbtu) | 75.52 | |
Discounted cash flow approach | Level 3 | Commodity Price Hedges | Natural gas | Basis swaps | ||
Quantitative Information About Level 3 Fair Value Measurements | ||
Fair Value | ($265) | |
Discounted cash flow approach | Level 3 | Commodity Price Hedges | Natural gas | Basis swaps | Minimum | ||
Quantitative Information About Level 3 Fair Value Measurements | ||
Swap price (in dollars per barrel/mmbtu) | -0.11 | |
Discounted cash flow approach | Level 3 | Commodity Price Hedges | Natural gas | Basis swaps | Maximum | ||
Quantitative Information About Level 3 Fair Value Measurements | ||
Swap price (in dollars per barrel/mmbtu) | -0.17 |
Fair_Value_Measurement_Details2
Fair Value Measurement (Details 3) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Nonrecurring | Carrying Amount | 2022 Notes | Senior notes | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt | $500,000 | |
Nonrecurring | Carrying Amount | Revolver | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt | 360,000 | 498,000 |
Nonrecurring | Carrying Amount | Term Loan | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt | 160,000 | |
Nonrecurring | Fair Value | 2022 Notes | Senior notes | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt | 384,375 | |
Nonrecurring | Fair Value | Revolver | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt | 360,000 | 498,000 |
Nonrecurring | Fair Value | Term Loan | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt | 160,000 | |
Level 3 | ||
Changes in fair value of Level 3 instruments | ||
Balance at the beginning of the period | -1,235 | -1,519 |
Purchases | 668 | -1,095 |
Settlements | 476 | -210 |
Transfer to Level 2 | 332 | -753 |
Transfers to Level 3 | 0 | 0 |
Changes in fair value | 2,804 | 2,342 |
Balance at the end of the period | $2,780 | ($1,235) |
Fair_Value_Measurement_Details3
Fair Value Measurement (Details 4) (USD $) | 3 Months Ended | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Nonfinancial Assets and Liabilities | ||||
Impairment of unproved properties | $14.40 | $0 | $0 | |
Impairment of proved properties | $0 | $0 | $18.80 |
Derivative_Instruments_and_Hed2
Derivative Instruments and Hedging Activities (Details) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Basis swaps | Minimum | |||
Derivative instruments and hedging activities | |||
Contract differential (in dollars per mmbtu) | -0.39 | -0.43 | |
Nonmonetary notional amount | 320,000 | 320,000 | |
Basis swaps | Maximum | |||
Derivative instruments and hedging activities | |||
Contract differential (in dollars per mmbtu) | -0.11 | -0.11 | |
Nonmonetary notional amount | 980,000 | 690,000 | |
Basis swaps | Weighted Average | |||
Derivative instruments and hedging activities | |||
Contract differential (in dollars per mmbtu) | -0.21 | -0.34 | |
Nonmonetary notional amount | 716,667 | 467,037 | |
Oil | Swaps | Minimum | |||
Derivative instruments and hedging activities | |||
Exercise price (in dollars per barrels) | 75.05 | 81.7 | |
Nonmonetary notional amount | 45,000 | 29,000 | |
Oil | Swaps | Maximum | |||
Derivative instruments and hedging activities | |||
Exercise price (in dollars per barrels) | 100.95 | 102.84 | |
Nonmonetary notional amount | 184,054 | 161,613 | |
Oil | Swaps | Weighted Average | |||
Derivative instruments and hedging activities | |||
Exercise price (in dollars per barrels) | 84.2 | 89.03 | |
Nonmonetary notional amount | 113,852 | 96,149 | |
Natural gas | Swaps | Minimum | |||
Derivative instruments and hedging activities | |||
Exercise price (in dollars per mmbtu) | 3.37 | 3.88 | |
Nonmonetary notional amount | 710,000 | 510,000 | |
Natural gas | Swaps | Maximum | |||
Derivative instruments and hedging activities | |||
Exercise price (in dollars per mmbtu) | 6.45 | 6.9 | |
Nonmonetary notional amount | 1,772,584 | 1,290,000 | |
Natural gas | Swaps | Weighted Average | |||
Derivative instruments and hedging activities | |||
Exercise price (in dollars per mmbtu) | 4.4 | 4.26 | |
Nonmonetary notional amount | 1,175,275 | 830,275 | |
Natural gas liquids | Swaps | Minimum | |||
Derivative instruments and hedging activities | |||
Exercise price (in dollars per barrels) | 8.09 | 6.72 | |
Nonmonetary notional amount | 2,000 | 2,000 | |
Natural gas liquids | Swaps | Maximum | |||
Derivative instruments and hedging activities | |||
Exercise price (in dollars per barrels) | 95.24 | 95.24 | |
Nonmonetary notional amount | 143,000 | 118,000 | |
Natural gas liquids | Swaps | Weighted Average | |||
Derivative instruments and hedging activities | |||
Exercise price (in dollars per barrels) | 42.46 | 32.98 | |
Nonmonetary notional amount | 50,444 | 46,646 | |
Commodity Price Hedges | |||
Derivative instruments and hedging activities | |||
Net gains (Losses) recognized on derivative instruments | $189.60 | ($2.60) | $16.70 |
Derivative_Instruments_and_Hed3
Derivative Instruments and Hedging Activities (Details 2) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Offsetting Assets and Liabilities | ||
Number of counterparties to commodity derivative contracts | 7 | |
Commodity Price Hedges | ||
Assets | ||
Gross Amounts of Recognized Assets | $208,646 | $38,071 |
Gross Amounts Offset in the Balance Sheet | -72 | -6,035 |
Net Amounts of Assets Presented in the Balance Sheet | 208,574 | 32,036 |
Gross Amounts Not Offset in the Balance Sheet | 2,199 | |
Net Amount | 208,574 | 34,235 |
Liabilities | ||
Gross Amounts of Recognized Liabilities | -100 | -14,347 |
Gross Amounts Offset in the Balance Sheet | 72 | 6,035 |
Net Amounts of Liabilities Presented in the Balance Sheet | -28 | -8,312 |
Gross Amounts Not Offset in the Balance Sheet | -2,542 | |
Net Amount | ($28) | ($10,854) |
LongTerm_Debt_Details
Long-Term Debt (Details) (USD $) | 12 Months Ended | 0 Months Ended | |||||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Apr. 01, 2014 | Dec. 31, 2009 | Nov. 06, 2014 | Nov. 05, 2014 | |
item | item | ||||||
Credit agreements | |||||||
Total interest expense | $46,726,000 | $30,774,000 | $25,292,000 | ||||
Number of credit agreements | 2 | 2 | |||||
Total interest and commitment fees | 13,000,000 | 27,000,000 | 21,200,000 | ||||
2022 Notes | Senior notes | |||||||
Credit agreements | |||||||
Issuance of debt | 500,000,000 | ||||||
Stated interest rate (as a percent) | 6.75% | ||||||
Accrued interest | 8,400,000 | ||||||
Total interest expense | 25,300,000 | ||||||
Revolver | |||||||
Credit agreements | |||||||
Repayment of borrowings | 3,800,000 | 308,000,000 | |||||
Borrowing base | 562,500,000 | 625,000,000 | 550,000,000 | ||||
Average interest rates (as a percent) | 333.80% | 3.01% | |||||
Average outstanding balance | 384,900,000 | ||||||
Average interest rate (as a percent) | 2.51% | ||||||
Revolver | London Interbank Offered Rate (LIBOR) | Minimum | |||||||
Credit agreements | |||||||
Margin interest rate (as a percent) | 1.50% | ||||||
Revolver | London Interbank Offered Rate (LIBOR) | Maximum | |||||||
Credit agreements | |||||||
Margin interest rate (as a percent) | 2.50% | ||||||
Revolver | Federal Funds Effective Swap Rate | |||||||
Credit agreements | |||||||
Margin interest rate (as a percent) | 0.50% | ||||||
Revolver | Base rate | Minimum | |||||||
Credit agreements | |||||||
Margin interest rate (as a percent) | 0.50% | ||||||
Revolver | Base rate | Maximum | |||||||
Credit agreements | |||||||
Margin interest rate (as a percent) | 1.50% | ||||||
Revolver | One Month Adjust LIBO Rate | |||||||
Credit agreements | |||||||
Margin interest rate (as a percent) | 1.00% | ||||||
Term Loan | |||||||
Credit agreements | |||||||
Repayment of borrowings | $160,000,000 |
Stockbased_Compensation_Detail
Stock-based Compensation (Details) (USD $) | 1 Months Ended | 12 Months Ended | 0 Months Ended | 12 Months Ended | ||
In Millions, except Share data, unless otherwise specified | 31-May-14 | Dec. 31, 2014 | Dec. 31, 2013 | Sep. 23, 2014 | Sep. 04, 2013 | Dec. 31, 2012 |
Performance Units Awards | ||||||
Weighted Average Grant Date Fair Value per Share | ||||||
Stock-based Compensation expensed recognition period | 3 years | |||||
Performance period of shareholder return | 3 years | |||||
Assumptions used to determine the grant date fair value and associated compensation expense | ||||||
Stock Price | $17.07 | |||||
Beginning Average Stock Price | $14.78 | |||||
Expected Volatility (as a percent) | 46.95% | |||||
Risk-Free Rate of Return (as a percent) | 0.61% | |||||
Number of trading days | 10 days | |||||
Remaining in the performance period | 2 years 7 months 13 days | |||||
Simulated fair value | $21.65 | |||||
Expected percentage of performance units earned | 126.80% | |||||
Performance Units Awards | Minimum | ||||||
Weighted Average Grant Date Fair Value per Share | ||||||
Number of shares of common stock issuable upon vesting of the performance unit awards (as a percent) | 0.00% | 0.00% | ||||
Performance Units Awards | Maximum | ||||||
Weighted Average Grant Date Fair Value per Share | ||||||
Number of shares of common stock issuable upon vesting of the performance unit awards (as a percent) | 200.00% | 200.00% | ||||
Restricted Stock Unit Awards | ||||||
Weighted Average Grant Date Fair Value per Share | ||||||
Stock-based Compensation expensed recognition period | 3 years | |||||
Class A common stock | Performance Units Awards | ||||||
Weighted Average Grant Date Fair Value per Share | ||||||
Exchangeable ratio of vested performance unit (as a percent) | 1.00% | |||||
General and administrative expenses | Performance Units Awards | ||||||
Weighted Average Grant Date Fair Value per Share | ||||||
Stock compensation expense | $0.90 | |||||
General and administrative expenses | Restricted Stock Unit Awards | ||||||
Weighted Average Grant Date Fair Value per Share | ||||||
Stock compensation expense | 1.1 | |||||
Officers and employees | Performance Units Awards | ||||||
Units/ Awards | ||||||
Granted (in shares) | 201,318 | |||||
Forfeited (in shares) | -8,320 | |||||
Unvested at the end of the period (in shares) | 192,998 | |||||
Weighted Average Grant Date Fair Value per Share | ||||||
Granted (in dollars per share) | $21.65 | |||||
Forfeited (in dollars per share) | $21.65 | |||||
Unvested at the end of the period (in dollars per share) | $21.65 | |||||
Performance period of shareholder return | 3 years | |||||
Officers and employees | Restricted Stock Unit Awards | ||||||
Units/ Awards | ||||||
Granted (in shares) | 340,001 | |||||
Forfeited (in shares) | -13,688 | |||||
Vested (in shares) | -1,416 | |||||
Unvested at the end of the period (in shares) | 324,897 | |||||
Weighted Average Grant Date Fair Value per Share | ||||||
Granted (in dollars per share) | $17.31 | |||||
Forfeited (in dollars per share) | $17.07 | |||||
Vested (in dollars per share) | $17.07 | |||||
Unvested at the end of the period (in dollars per share) | $17.33 | |||||
Non-employee members of Board Of Directors | Restricted stock | ||||||
Units/ Awards | ||||||
Unvested at the beginning of the period (in shares) | 26,580 | |||||
Granted (in shares) | 27,430 | 26,580 | ||||
Vested (in shares) | -26,580 | |||||
Unvested at the end of the period (in shares) | 27,430 | 26,580 | ||||
Weighted Average Grant Date Fair Value per Share | ||||||
Unvested at the beginning of the period (in dollars per share) | $15.05 | |||||
Granted (in dollars per share) | $18.77 | $15.05 | ||||
Vested (in dollars per share) | $15.05 | |||||
Unvested at the end of the period (in dollars per share) | $18.77 | $15.05 | ||||
Stock compensation expense | 0.4 | |||||
Non-employee members of Board Of Directors | Class A common stock | Restricted stock | ||||||
Weighted Average Grant Date Fair Value per Share | ||||||
Number of non-employee members of the Board of Directors to whom awards were granted | 5 | 4 | ||||
Awards granted to each non-employee director (in shares) | 5,486 | 6,645 | ||||
Service period from date of grant | 1 year | 1 year | ||||
Non-employee members of Board Of Directors | General and administrative expenses | Restricted stock | ||||||
Weighted Average Grant Date Fair Value per Share | ||||||
Stock compensation expense | 0.1 | |||||
Management incentive plan | Management units | JEH | Class B common stock | ||||||
Units/ Awards | ||||||
Unvested at the end of the period (in shares) | 274,385 | |||||
Management incentive plan | Management units | JEH | General and administrative expenses | ||||||
Weighted Average Grant Date Fair Value per Share | ||||||
Stock compensation expense | $1.60 | $10.70 | $0.60 | |||
Management incentive plan | Management units | JEH | Management | ||||||
Units/ Awards | ||||||
Unvested at the beginning of the period (in shares) | 457,150 | 710,767 | ||||
Granted (in shares) | 21,405 | 911,654 | ||||
Forfeited (in shares) | -21,405 | -167,239 | ||||
Vested (in shares) | -182,765 | -998,032 | ||||
Unvested at the end of the period (in shares) | 274,385 | 457,150 | ||||
Weighted Average Grant Date Fair Value per Share | ||||||
Unvested at the beginning of the period (in dollars per share) | $12.46 | $3.62 | ||||
Granted (in dollars per share) | $6.66 | $15 | ||||
Forfeited (in dollars per share) | $6.66 | $3.62 | ||||
Vested (in dollars per share) | $8.65 | $9.96 | ||||
Unvested at the end of the period (in dollars per share) | $15 | $12.46 |
Earnings_per_Share_Details
Earnings per Share (Details) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 275 | 27 |
Restricted stock | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 27,430 | |
Restricted Stock Unit Awards | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 54,656 | |
Performance Units Awards | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 192,998 |
Earnings_per_Share_Details_2
Earnings per Share (Details 2) (USD $) | 12 Months Ended | ||
In Thousands, except Share data, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Income (numerator): | |||
Net income attributable to controlling interests | $40,868 | ($2,186) | ($3,079) |
Weighted-average shares (denominator): | |||
Weighted-average number of shares of Class A common stock - basic | 12,526 | 12,500 | |
Weighted-average number of shares of Class A common stock - diluted | 12,535 | 12,500 | |
Earnings per share: | |||
Basic | $3.26 | ($0.17) | |
Diluted | $3.26 | ($0.17) | |
JEI (Parent) | |||
Income (numerator): | |||
Net income attributable to controlling interests | $40,868 | ($2,186) |
Monarch_Investment_Details
Monarch Investment (Details) (USD $) | 12 Months Ended | 0 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | 7-May-13 | |
Monarch Investment | |||
Deferred revenue recorded | $13,377,000 | $14,531,000 | |
Equity interests issued to the Company in connection with the marketing agreement | |||
Monarch Investment | |||
Compensation expense recognized under management distributions and incentive plan | 800,000 | 300,000 | |
Deferred revenue recorded | 15,000,000 | ||
Equity interests issued to the Company in connection with the marketing agreement | Equity interests | Monarch Natural Gas Holdings, LLC | |||
Monarch Investment | |||
Equity interests distributed to the entity's owners (as a percent) | 67.00% | ||
Equity interests distributed to the entity's owners | 10,000,000 | ||
Equity interests distributed to a member of management (as a percent) | 16.00% | ||
Equity Interests Distributed Management | 500,000 | ||
Equity interests reserved for distribution to management through incentive plan (as a percent) | 17.00% | ||
Monarch | |||
Monarch Investment | |||
Amortization of deferred revenue | 1,200,000 | 500,000 | |
Monarch | Equity interests issued to the Company in connection with the marketing agreement | Equity interests | Monarch Natural Gas Holdings, LLC | |||
Monarch Investment | |||
Estimated fair value of equity interests issued to the entity | $15,000,000 |
Commitments_and_Contingencies_1
Commitments and Contingencies (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
sqft | |||
Commitments and Contingencies | |||
Leased area of office space in Austin, TX (in square feet) | 43,000 | ||
Future minimum payments for noncancellable operating leases | |||
2015 | $944,000 | ||
2016 | 954,000 | ||
2017 | 1,038,000 | ||
2018 | 1,101,000 | ||
2019 | 1,122,000 | ||
Thereafter | 377,000 | ||
Total | 5,536,000 | ||
Rent expense under operating leases | $900,000 | $800,000 | $800,000 |
Benefit_Plans_Details
Benefit Plans (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
401(k) | ||
Benefit Plans | ||
Amount contributed to the Plan | $300,000 | $300,000 |
409A | ||
Benefit Plans | ||
Amount contributed to the Plan | $0 | $0 |
Income_Taxes_Details
Income Taxes (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Current tax expense | |||
Federal | $53 | $85 | |
Total current expense | 53 | 85 | |
Deferred tax expense (benefit) | |||
Federal | 21,996 | -1,260 | |
State | 4,025 | 1,104 | 473 |
Total deferred expense (benefit) | 26,021 | -156 | 473 |
Total income tax provision | 26,074 | -71 | 473 |
Tax benefit attributable to controlling interests | 22,675 | -1,223 | 473 |
Tax expense attributable to non-controlling interests | 3,399 | 1,152 | |
Provision calculated at federal statutory income tax rate: | |||
Net income before taxes | 250,217 | 22,334 | -2,606 |
Statutory rate (as a percent) | 35.00% | 35.00% | |
Income tax expense computed at statutory rate | 87,577 | 7,817 | |
Less: Noncontrolling interests | -65,336 | -9,009 | |
Income tax benefit attributable to Jones Energy, Inc. | 22,241 | -1,192 | |
State and local income taxes, net of federal benefit | 626 | -49 | |
Other | -192 | 18 | |
Tax benefit attributable to Jones Energy, Inc. | 22,675 | -1,223 | 473 |
Tax expense attributable to non-controlling interests | 3,399 | 1,152 | |
Total income tax provision | 26,074 | -71 | 473 |
Deferred tax assets | |||
Investment in consolidated Subsidiary JEH | 526 | ||
Net operating loss | 8,223 | 649 | |
Section 754 election tax basis adjustment | 945 | ||
Alternative minimum tax credits | 53 | 86 | |
State deferred tax asset | 232 | 52 | |
Total deferred tax assets | 9,453 | 1,313 | |
Deferred tax liabilities | |||
State deferred tax liability | 718 | ||
Investment in consolidated subsidiary JEH | 29,163 | ||
Noncurrent state deferred tax liability | 6,731 | 3,093 | |
Total deferred tax liabilities | 36,612 | 3,093 | |
Net deferred tax assets (liabilities) | -27,159 | -1,780 | |
Net deferred tax assets (liabilities) | -27,159 | -1,780 | |
JEI (Parent) | |||
Current tax expense | |||
Total current expense | 53 | 85 | |
Deferred tax expense (benefit) | |||
Total deferred expense (benefit) | 21,864 | -1,299 | |
Total income tax provision | 21,917 | -1,214 | |
Provision calculated at federal statutory income tax rate: | |||
Total income tax provision | $21,917 | ($1,214) |
Income_Taxes_Details_2
Income Taxes (Details 2) (USD $) | Dec. 31, 2014 |
In Millions, unless otherwise specified | |
Federal | |
Operating loss carry-forward | |
Net operating loss carry-forward | $22.40 |
State | |
Operating loss carry-forward | |
Net operating loss carry-forward | $9.60 |
Income_Taxes_Details_3
Income Taxes (Details 3) (USD $) | Dec. 31, 2014 |
In Millions, unless otherwise specified | |
Income Taxes | |
Future Tax Benefits | $0.90 |
Tax Savings Receivable in Connection with Tax Receivable Agreement (as a percent) | 85.00% |
Liability under tax receivable agreement | $0.80 |
Subsequent_Events_Details
Subsequent Events (Details) (Subsequent event, USD $) | 0 Months Ended | |
Feb. 17, 2015 | Feb. 23, 2015 | |
Class A common stock | Follow-on offering | ||
Subsequent events | ||
Issuance of common stock (in shares) | 7,500,000 | |
Price (in dollars per shares) | $10.25 | |
Underwriter option period | 30 days | |
Underwriter option (in shares) | 1,125,000 | |
Class A common stock | Private placement | ||
Subsequent events | ||
Issuance of common stock | $50,000,000 | |
Issuance of common stock (in shares) | 4,761,905 | |
Price (in dollars per shares) | $10.50 | |
2023 Notes | Senior notes | ||
Subsequent events | ||
Issuance of debt | $250,000,000 | |
Stated interest rate (as a percent) | 9.25% |
Subsidiary_Guarantors_Details
Subsidiary Guarantors (Details) (Senior notes, 2022 Notes, USD $) | Apr. 01, 2014 |
In Millions, unless otherwise specified | |
Senior notes | 2022 Notes | |
Subsidiary Guarantors | |
Issuance of debt | $500 |
Stated interest rate (as a percent) | 6.75% |
Subsidiary_Guarantors_Details_
Subsidiary Guarantors (Details 2) | 12 Months Ended |
Dec. 31, 2014 | |
item | |
Subsidiary Guarantors | |
Classes of stock, number | 2 |
Class A common stock | |
Subsidiary Guarantors | |
Economic interests | 100.00% |
Votes per share entitled to stockholders | 1 |
Class B common stock | |
Subsidiary Guarantors | |
Economic interests | 0.00% |
Votes per share entitled to stockholders | 1 |
Issuers | |
Subsidiary Guarantors | |
Economic interest | 25.60% |
Existing Owners | Class A common stock | |
Subsidiary Guarantors | |
Ratio in which JEH Units and Class B common stock is exchanged for Class A common stock | 1 |
Issuers | Guarantor Subsidiaries | |
Subsidiary Guarantors | |
Ownership percentage in subsidiary guarantors | 100.00% |
Existing Owners | Issuers | |
Subsidiary Guarantors | |
Economic interest (as a percent) | 74.40% |
Subsidiary_Guarantors_Details_1
Subsidiary Guarantors (Details 3) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
In Thousands, except Share data, unless otherwise specified | ||||
Current assets | ||||
Cash | $13,566 | $23,820 | ||
Restricted Cash | 149 | 45 | ||
Accounts receivable, net | ||||
Oil and gas sales | 49,861 | 51,233 | ||
Joint interest owners | 41,761 | 42,481 | ||
Other | 12,512 | 16,782 | ||
Commodity derivative assets | 121,519 | 8,837 | ||
Other current assets | 3,374 | 2,392 | ||
Deferred tax assets | 12 | |||
Total current assets | 242,742 | 145,602 | ||
Oil and gas properties, net, at cost under the successful efforts method | 1,638,860 | 1,297,228 | ||
Other property, plant and equipment, net | 4,048 | 3,444 | ||
Commodity derivative assets | 87,055 | 25,398 | ||
Other assets | 20,352 | 15,006 | ||
Deferred tax assets | 171 | 1,301 | ||
Total assets | 1,993,228 | 1,487,979 | ||
Current liabilities | ||||
Trade accounts payable | 136,337 | 89,430 | ||
Oil and gas sales payable | 70,469 | 66,179 | ||
Accrued liabilities | 19,401 | 10,805 | ||
Commodity derivative liabilities | 10,664 | |||
Deferred tax liabilities | 718 | |||
Asset retirement obligations | 3,074 | 2,590 | ||
Total current liabilities | 229,999 | 179,668 | ||
Long-term debt | 360,000 | 658,000 | ||
Senior notes | 500,000 | |||
Deferred revenue | 13,377 | 14,531 | ||
Commodity derivative liabilities | 28 | 190 | ||
Asset retirement obligations | 10,536 | 8,373 | ||
Liability under tax receivable agreement | 803 | |||
Deferred tax liabilities | 26,612 | 3,093 | ||
Total liabilities | 1,141,355 | 863,855 | ||
Commitments and contingencies (Note 10) | ||||
Stockholders' / members' equity | ||||
Treasury stock, at cost; 22,602 shares at December 31, 2014 and 0 shares at December 31, 2013 | -358 | |||
Additional paid-in-capital | 177,133 | 173,169 | ||
Retained earnings (deficit) | 38,682 | -2,186 | ||
Stockholders' equity | 215,507 | 171,033 | ||
Non-controlling interest | 636,366 | 453,091 | ||
Total stockholders' equity | 851,873 | 624,124 | 428,400 | 345,909 |
Total liabilities and stockholders' equity | 1,993,228 | 1,487,979 | ||
Treasury stock, shares | 22,602 | 0 | ||
Class A common stock | ||||
Stockholders' / members' equity | ||||
Common Stock | 13 | 13 | ||
Common Stock, par value (in dollars per share) | $0.00 | $0.00 | ||
Common Stock, shares issued | 12,672,260 | 12,526,580 | ||
Common Stock, shares outstanding | 12,649,658 | 12,526,580 | ||
Class B common stock | ||||
Stockholders' / members' equity | ||||
Common Stock | 37 | 37 | ||
Common Stock, par value (in dollars per share) | $0.00 | $0.00 | ||
Common Stock, shares issued | 36,719,499 | 36,836,333 | ||
Common Stock, shares outstanding | 36,719,499 | 36,836,333 | ||
Eliminations | ||||
Accounts receivable, net | ||||
Intercompany receivable | -1,207,444 | -1,052,027 | ||
Total current assets | -1,207,444 | -1,052,027 | ||
Investment in Subsidiaries | -231,866 | -169,081 | ||
Total assets | -1,439,310 | -1,221,108 | ||
Current liabilities | ||||
Intercompany payable | -1,209,630 | -1,054,214 | ||
Total current liabilities | -1,209,630 | -1,054,214 | ||
Total liabilities | -1,209,630 | -1,054,214 | ||
Stockholders' / members' equity | ||||
Members' equity | -866,046 | -619,985 | ||
Stockholders' equity | -866,046 | -619,985 | ||
Non-controlling interest | 636,366 | 453,091 | ||
Total stockholders' equity | -229,680 | -166,894 | ||
Total liabilities and stockholders' equity | -1,439,310 | -1,221,108 | ||
JEI (Parent) | ||||
Current assets | ||||
Cash | 100 | 100 | ||
Accounts receivable, net | ||||
Other | 102 | |||
Intercompany receivable | 4,164 | 638 | ||
Total current assets | 4,366 | 738 | ||
Investment in Subsidiaries | 231,866 | 169,081 | ||
Deferred tax assets | 171 | 1,301 | ||
Total assets | 236,403 | 171,120 | ||
Current liabilities | ||||
Accrued liabilities | 87 | |||
Total current liabilities | 87 | |||
Liability under tax receivable agreement | 803 | |||
Deferred tax liabilities | 20,093 | |||
Total liabilities | 20,896 | 87 | ||
Stockholders' / members' equity | ||||
Treasury stock, at cost; 22,602 shares at December 31, 2014 and 0 shares at December 31, 2013 | -358 | |||
Additional paid-in-capital | 177,133 | 173,169 | ||
Retained earnings (deficit) | 38,682 | -2,186 | ||
Stockholders' equity | 215,507 | 171,033 | ||
Total stockholders' equity | 215,507 | 171,033 | ||
Total liabilities and stockholders' equity | 236,403 | 171,120 | ||
Treasury stock, shares | 22,602 | |||
JEI (Parent) | Class A common stock | ||||
Stockholders' / members' equity | ||||
Common Stock | 13 | 13 | ||
Common Stock, par value (in dollars per share) | $0.00 | $0.00 | ||
Common Stock, shares issued | 12,672,260 | 12,526,580 | ||
Common Stock, shares outstanding | 12,649,658 | 12,526,580 | ||
JEI (Parent) | Class B common stock | ||||
Stockholders' / members' equity | ||||
Common Stock | 37 | 37 | ||
Common Stock, par value (in dollars per share) | $0.00 | $0.00 | ||
Common Stock, shares issued | 36,719,499 | 36,836,333 | ||
Common Stock, shares outstanding | 36,719,499 | 36,836,333 | ||
Issuers | ||||
Current assets | ||||
Cash | 1,000 | 6,000 | ||
Accounts receivable, net | ||||
Other | 8,788 | |||
Commodity derivative assets | 121,519 | 8,837 | ||
Other current assets | 451 | 387 | ||
Deferred tax assets | 12 | |||
Intercompany receivable | 1,205,608 | 1,051,389 | ||
Total current assets | 1,337,366 | 1,066,625 | ||
Commodity derivative assets | 87,055 | 25,398 | ||
Other assets | 20,098 | 14,072 | ||
Total assets | 1,444,519 | 1,106,095 | ||
Current liabilities | ||||
Trade accounts payable | 288 | 230 | ||
Accrued liabilities | 8,914 | 1,642 | ||
Commodity derivative liabilities | 10,664 | |||
Deferred tax liabilities | 718 | |||
Total current liabilities | 9,920 | 12,536 | ||
Long-term debt | 360,000 | 658,000 | ||
Senior notes | 500,000 | |||
Deferred revenue | 13,377 | 14,531 | ||
Commodity derivative liabilities | 28 | 190 | ||
Deferred tax liabilities | 6,519 | 3,093 | ||
Total liabilities | 889,844 | 688,350 | ||
Stockholders' / members' equity | ||||
Members' equity | 554,675 | 417,745 | ||
Stockholders' equity | 554,675 | 417,745 | ||
Total stockholders' equity | 554,675 | 417,745 | ||
Total liabilities and stockholders' equity | 1,444,519 | 1,106,095 | ||
Guarantor Subsidiaries | ||||
Current assets | ||||
Cash | 12,436 | 17,650 | ||
Restricted Cash | 149 | 45 | ||
Accounts receivable, net | ||||
Oil and gas sales | 49,861 | 51,233 | ||
Joint interest owners | 41,761 | 42,481 | ||
Other | 3,622 | 16,782 | ||
Other current assets | 2,923 | 2,005 | ||
Total current assets | 110,752 | 130,196 | ||
Oil and gas properties, net, at cost under the successful efforts method | 1,638,860 | 1,297,228 | ||
Other property, plant and equipment, net | 3,252 | 2,557 | ||
Other assets | 254 | 934 | ||
Total assets | 1,753,118 | 1,430,915 | ||
Current liabilities | ||||
Trade accounts payable | 136,049 | 89,200 | ||
Oil and gas sales payable | 70,469 | 66,179 | ||
Accrued liabilities | 10,487 | 9,076 | ||
Asset retirement obligations | 3,074 | 2,590 | ||
Intercompany payable | 1,209,630 | 1,051,935 | ||
Total current liabilities | 1,429,709 | 1,218,980 | ||
Asset retirement obligations | 10,536 | 8,373 | ||
Total liabilities | 1,440,245 | 1,227,353 | ||
Stockholders' / members' equity | ||||
Members' equity | 312,873 | 203,562 | ||
Stockholders' equity | 312,873 | 203,562 | ||
Total stockholders' equity | 312,873 | 203,562 | ||
Total liabilities and stockholders' equity | 1,753,118 | 1,430,915 | ||
Non-Guarantor Subsidiaries | ||||
Current assets | ||||
Cash | 30 | 70 | ||
Accounts receivable, net | ||||
Intercompany receivable | -2,328 | |||
Total current assets | -2,298 | 70 | ||
Other property, plant and equipment, net | 796 | 887 | ||
Total assets | -1,502 | 957 | ||
Current liabilities | ||||
Intercompany payable | 2,279 | |||
Total current liabilities | 2,279 | |||
Total liabilities | 2,279 | |||
Stockholders' / members' equity | ||||
Members' equity | -1,502 | -1,322 | ||
Stockholders' equity | -1,502 | -1,322 | ||
Total stockholders' equity | -1,502 | -1,322 | ||
Total liabilities and stockholders' equity | ($1,502) | $957 |
Subsidiary_Guarantors_Details_2
Subsidiary Guarantors (Details 4) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Operating revenues | |||
Oil and gas sales | $378,401 | $258,063 | $148,967 |
Other revenues | 2,196 | 1,106 | 847 |
Total operating revenues | 380,597 | 259,169 | 149,814 |
Operating costs and expenses | |||
Lease operating | 43,843 | 27,781 | 23,097 |
Production taxes | 18,094 | 12,865 | 5,583 |
Exploration | 3,453 | 1,710 | 356 |
Depletion, depreciation and amortization | 181,669 | 114,136 | 80,709 |
Impairment of oil and gas properties | 14,415 | 18,821 | |
Accretion of discount | 770 | 608 | 533 |
General and administrative (including non-cash compensation expense) | 25,763 | 31,902 | 15,875 |
Total operating expenses | 273,592 | 203,417 | 144,974 |
Operating income | 107,005 | 55,752 | 4,840 |
Other income (expense) | |||
Interest expense | -46,726 | -30,774 | -25,292 |
Net gain (loss) on commodity derivatives | 189,641 | -2,566 | 16,684 |
Gain (loss) on sales of assets | 297 | -78 | 1,162 |
Other income (expense), net | 143,212 | -33,418 | -7,446 |
Income (loss) before income tax | 250,217 | 22,334 | -2,606 |
Income tax provision (benefit) | |||
Current | 53 | 85 | |
Deferred | 26,021 | -156 | 473 |
Total income tax provision | 26,074 | -71 | 473 |
Net income (loss) | 224,143 | 22,405 | -3,079 |
Net income attributable to non-controlling interests | 183,275 | 24,591 | |
Net income (loss) attributable to controlling interests | 40,868 | -2,186 | -3,079 |
Eliminations | |||
Other income (expense) | |||
Equity interest in income | -62,785 | 3,400 | |
Income tax provision (benefit) | |||
Net income (loss) | -62,785 | 3,400 | |
Net income attributable to non-controlling interests | 183,275 | 24,591 | |
JEI (Parent) | |||
Other income (expense) | |||
Equity interest in income | 62,785 | -3,400 | |
Income tax provision (benefit) | |||
Current | 53 | 85 | |
Deferred | 21,864 | -1,299 | |
Total income tax provision | 21,917 | -1,214 | |
Net income (loss) | 40,868 | -2,186 | |
Net income (loss) attributable to controlling interests | 40,868 | -2,186 | |
Issuers | |||
Operating revenues | |||
Other revenues | 1,154 | 469 | |
Total operating revenues | 1,154 | 469 | |
Operating costs and expenses | |||
General and administrative (including non-cash compensation expense) | 4,494 | 4,154 | |
Total operating expenses | 4,494 | 4,154 | |
Operating income | -3,340 | -3,685 | |
Other income (expense) | |||
Interest expense | -45,215 | -29,653 | |
Net gain (loss) on commodity derivatives | 189,641 | -2,566 | |
Other income (expense), net | 144,426 | -32,219 | |
Income (loss) before income tax | 141,086 | -35,904 | |
Income tax provision (benefit) | |||
Deferred | 4,157 | 1,143 | |
Total income tax provision | 4,157 | 1,143 | |
Net income (loss) | 136,929 | -37,047 | |
Guarantor Subsidiaries | |||
Operating revenues | |||
Oil and gas sales | 378,401 | 258,063 | |
Other revenues | 1,042 | 637 | |
Total operating revenues | 379,443 | 258,700 | |
Operating costs and expenses | |||
Lease operating | 43,843 | 27,781 | |
Production taxes | 18,094 | 12,865 | |
Exploration | 3,453 | 1,710 | |
Depletion, depreciation and amortization | 181,578 | 114,046 | |
Impairment of oil and gas properties | 14,415 | ||
Accretion of discount | 770 | 608 | |
General and administrative (including non-cash compensation expense) | 21,180 | 27,490 | |
Total operating expenses | 268,918 | 198,915 | |
Operating income | 110,525 | 59,785 | |
Other income (expense) | |||
Interest expense | -1,511 | -1,121 | |
Gain (loss) on sales of assets | 297 | 41 | |
Other income (expense), net | -1,214 | -1,080 | |
Income (loss) before income tax | 109,311 | 58,705 | |
Income tax provision (benefit) | |||
Net income (loss) | 109,311 | 58,705 | |
Non-Guarantor Subsidiaries | |||
Operating costs and expenses | |||
Depletion, depreciation and amortization | 91 | 90 | |
General and administrative (including non-cash compensation expense) | 89 | 258 | |
Total operating expenses | 180 | 348 | |
Operating income | -180 | -348 | |
Other income (expense) | |||
Gain (loss) on sales of assets | -119 | ||
Other income (expense), net | -119 | ||
Income (loss) before income tax | -180 | -467 | |
Income tax provision (benefit) | |||
Net income (loss) | ($180) | ($467) |
Subsidiary_Guarantors_Details_3
Subsidiary Guarantors (Details 5) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Cash flows from operating activities | |||
Net income (loss) | $224,143,000 | $22,405,000 | ($3,079,000) |
Adjustments to reconcile net income (loss) to net cash provided by operating activities | 41,280,000 | 126,168,000 | |
Net cash provided by operations | 265,423,000 | 148,573,000 | 84,550,000 |
Cash flows from investing activities | |||
Additions to oil and gas properties | -474,619,000 | -197,618,000 | -125,493,000 |
Acquisition of properties | -178,173,000 | -249,007,000 | |
Net adjustments to purchase price of properties acquired | 15,709,000 | ||
Proceeds from sales of assets | 448,000 | 1,607,000 | 9,158,000 |
Acquisition of other property, plant and equipment | -1,683,000 | -1,634,000 | -969,000 |
Current period settlements of matured derivative contracts | -3,654,000 | 7,586,000 | 28,675,000 |
Change in restricted cash | -104,000 | -45,000 | |
Net cash (used in) investing | -463,903,000 | -368,277,000 | -337,636,000 |
Cash flows from financing activities | |||
Proceeds from issuance of long-term debt | 170,000,000 | 220,000,000 | 233,243,000 |
Repayment under long-term debt | -468,000,000 | -172,000,000 | -38,243,000 |
Proceeds from senior notes | 500,000,000 | ||
Payment of debt issuance costs | -13,416,000 | -683,000 | -9,324,000 |
Proceeds from sale of common stock, net of expenses of $15.1 million | 172,481,000 | ||
Purchases of treasury stock | 358,000 | ||
Net cash provided by financing | 188,226,000 | 219,798,000 | 270,676,000 |
Net increase (decrease) in cash | -10,254,000 | 94,000 | 17,590,000 |
Cash | |||
Beginning of period | 23,820,000 | 23,726,000 | 6,136,000 |
End of period | 13,566,000 | 23,820,000 | 23,726,000 |
Payments of Stock Issuance Costs | 15,100,000 | ||
Eliminations | |||
Cash flows from operating activities | |||
Net income (loss) | -62,785,000 | 3,400,000 | |
Adjustments to reconcile net income (loss) to net cash provided by operating activities | 62,785,000 | -3,400,000 | |
Cash flows from investing activities | |||
Investment in subsidiary | 172,481,000 | ||
Net cash (used in) investing | 172,481,000 | ||
Cash flows from financing activities | |||
Proceeds from investment by JEI | 172,481,000 | ||
Net cash provided by financing | -172,481,000 | ||
JEI (Parent) | |||
Cash flows from operating activities | |||
Net income (loss) | 40,868,000 | -2,186,000 | |
Adjustments to reconcile net income (loss) to net cash provided by operating activities | -40,510,000 | 2,286,000 | |
Net cash provided by operations | 358,000 | 100,000 | |
Cash flows from investing activities | |||
Investment in subsidiary | -172,481,000 | ||
Net cash (used in) investing | -172,481,000 | ||
Cash flows from financing activities | |||
Proceeds from sale of common stock, net of expenses of $15.1 million | 172,481,000 | ||
Purchases of treasury stock | 358,000 | ||
Net cash provided by financing | -358,000 | 172,481,000 | |
Net increase (decrease) in cash | 100,000 | ||
Cash | |||
Beginning of period | 100,000 | ||
End of period | 100,000 | 100,000 | |
Payments of Stock Issuance Costs | 15,100,000 | ||
Issuers | |||
Cash flows from operating activities | |||
Net income (loss) | 136,929,000 | -37,047,000 | |
Adjustments to reconcile net income (loss) to net cash provided by operating activities | -326,859,000 | -189,393,000 | |
Net cash provided by operations | -189,930,000 | -226,440,000 | |
Cash flows from investing activities | |||
Current period settlements of matured derivative contracts | -3,654,000 | 7,586,000 | |
Net cash (used in) investing | -3,654,000 | 7,586,000 | |
Cash flows from financing activities | |||
Proceeds from investment by JEI | -172,481,000 | ||
Proceeds from issuance of long-term debt | 170,000,000 | 220,000,000 | |
Repayment under long-term debt | -468,000,000 | -172,000,000 | |
Proceeds from senior notes | 500,000,000 | ||
Payment of debt issuance costs | -13,416,000 | -683,000 | |
Net cash provided by financing | 188,584,000 | 219,798,000 | |
Net increase (decrease) in cash | -5,000,000 | 944,000 | |
Cash | |||
Beginning of period | 6,000,000 | 5,056,000 | |
End of period | 1,000,000 | 6,000,000 | |
Guarantor Subsidiaries | |||
Cash flows from operating activities | |||
Net income (loss) | 109,311,000 | 58,705,000 | |
Adjustments to reconcile net income (loss) to net cash provided by operating activities | 345,724,000 | 315,942,000 | |
Net cash provided by operations | 455,035,000 | 374,647,000 | |
Cash flows from investing activities | |||
Additions to oil and gas properties | -474,619,000 | -197,618,000 | |
Acquisition of properties | -178,173,000 | ||
Net adjustments to purchase price of properties acquired | 15,709,000 | ||
Proceeds from sales of assets | 448,000 | 963,000 | |
Acquisition of other property, plant and equipment | -1,683,000 | -724,000 | |
Change in restricted cash | -104,000 | -45,000 | |
Net cash (used in) investing | -460,249,000 | -375,597,000 | |
Cash flows from financing activities | |||
Net increase (decrease) in cash | -5,214,000 | -950,000 | |
Cash | |||
Beginning of period | 17,650,000 | 18,600,000 | |
End of period | 12,436,000 | 17,650,000 | |
Non-Guarantor Subsidiaries | |||
Cash flows from operating activities | |||
Net income (loss) | -180,000 | -467,000 | |
Adjustments to reconcile net income (loss) to net cash provided by operating activities | 140,000 | 733,000 | |
Net cash provided by operations | -40,000 | 266,000 | |
Cash flows from investing activities | |||
Proceeds from sales of assets | 644,000 | ||
Acquisition of other property, plant and equipment | -910,000 | ||
Net cash (used in) investing | -266,000 | ||
Cash flows from financing activities | |||
Net increase (decrease) in cash | -40,000 | ||
Cash | |||
Beginning of period | 70,000 | 70,000 | |
End of period | $30,000 | $70,000 |