Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2020 | Apr. 29, 2020 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Mar. 31, 2020 | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q1 | |
Trading Symbol | TALO | |
Title of 12(b) Security | Common Stock | |
Security Exchange Name | NYSE | |
Entity Registrant Name | Talos Energy Inc. | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Shell Company | false | |
Entity Incorporation, State or Country Code | DE | |
Entity File Number | 001-38497 | |
Entity Tax Identification Number | 82-3532642 | |
Entity Address, Address Line One | 333 Clay Street | |
Entity Address, Address Line Two | Suite 3300 | |
Entity Address, City or Town | Houston | |
Entity Address, State or Province | TX | |
Entity Address, Postal Zip Code | 77002 | |
City Area Code | 713 | |
Local Phone Number | 328-3000 | |
Entity Central Index Key | 0001724965 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 65,342,273 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Current assets: | ||
Cash and cash equivalents | $ 106,952 | $ 87,022 |
Accounts receivable | ||
Trade, net | 81,027 | 107,842 |
Joint interest, net | 32,894 | 16,552 |
Other | 36,556 | 6,346 |
Assets from price risk management activities | 192,553 | 8,393 |
Prepaid assets | 50,273 | 65,877 |
Other current assets | 2,046 | 1,952 |
Total current assets | 502,301 | 293,984 |
Property and equipment: | ||
Proved properties | 4,538,100 | 4,066,260 |
Unproved properties, not subject to amortization | 277,050 | 194,532 |
Other property and equipment | 31,966 | 29,843 |
Total property and equipment | 4,847,116 | 4,290,635 |
Accumulated depreciation, depletion and amortization | (2,158,566) | (2,065,023) |
Total property and equipment, net | 2,688,550 | 2,225,612 |
Other long-term assets: | ||
Assets from price risk management activities | 8,794 | |
Other well equipment inventory | 9,178 | 7,732 |
Operating lease assets | 7,590 | 7,779 |
Other assets | 21,774 | 54,375 |
Total assets | 3,238,187 | 2,589,482 |
Current liabilities: | ||
Accounts payable | 58,750 | 71,357 |
Accrued liabilities | 138,271 | 154,816 |
Accrued royalties | 24,631 | 31,729 |
Current portion of asset retirement obligations | 38,028 | 61,051 |
Liabilities from price risk management activities | 4,286 | 19,476 |
Accrued interest payable | 22,257 | 10,249 |
Current portion of operating lease liabilities | 1,613 | 1,594 |
Other current liabilities | 20,918 | 20,180 |
Total current liabilities | 308,754 | 370,452 |
Long-term liabilities: | ||
Long-term debt, net of discount and deferred financing costs | 1,033,162 | 732,981 |
Asset retirement obligations | 387,868 | 308,427 |
Liabilities from price risk management activities | 1,898 | 511 |
Operating lease liabilities | 19,138 | 17,239 |
Other long-term liabilities | 92,470 | 81,595 |
Total liabilities | 1,843,290 | 1,511,205 |
Commitments and contingencies (Note 11) | ||
Stockholders' Equity: | ||
Preferred stock, $0.01 par value; 30,000,000 shares authorized and no shares issued or outstanding as of March 31, 2020 and December 31, 2019 | ||
Common stock $0.01 par value; 270,000,000 shares authorized; 65,342,273 and 54,197,004 shares issued and outstanding as of March 31, 2020 and December 31, 2019, respectively | 652 | 542 |
Additional paid-in capital | 1,504,903 | 1,346,142 |
Accumulated deficit | (110,658) | (268,407) |
Total stockholders' equity | 1,394,897 | 1,078,277 |
Total liabilities and stockholders' equity | $ 3,238,187 | $ 2,589,482 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Mar. 31, 2020 | Dec. 31, 2019 |
Statement Of Financial Position [Abstract] | ||
Preferred stock, par value | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 30,000,000 | 30,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 270,000,000 | 270,000,000 |
Common stock, shares issued | 65,342,273 | 54,197,004 |
Common stock, shares outstanding | 65,342,273 | 54,197,004 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Revenues: | ||
Total revenue | $ 187,764 | $ 178,713 |
Operating expenses: | ||
Depreciation, depletion and amortization | 93,543 | 64,587 |
Write-down of oil and natural gas properties | 57 | |
Accretion expense | 12,417 | 9,607 |
General and administrative expense | 27,469 | 17,609 |
Total operating expenses | 191,976 | 160,344 |
Operating income (expense) | (4,212) | 18,369 |
Interest expense | (25,850) | (25,218) |
Price risk management activities income (expense) | 243,217 | (109,579) |
Other income (expense) | (146) | 433 |
Net income (loss) before income taxes | 213,009 | (115,995) |
Income tax benefit (expense) | (55,260) | 6,359 |
Net income (loss) | $ 157,749 | $ (109,636) |
Net income (loss) per common share: | ||
Basic | $ 2.71 | $ (2.02) |
Diluted | $ 2.69 | $ (2.02) |
Weighted average common shares outstanding: | ||
Basic | 58,240 | 54,156 |
Diluted | 58,572 | 54,156 |
Oil and Gas Properties | ||
Operating expenses: | ||
Lease operating expense | $ 58,241 | $ 67,959 |
Production taxes | 249 | 582 |
Oil Revenue | ||
Revenues: | ||
Revenue | 166,624 | 155,679 |
Natural Gas Revenue | ||
Revenues: | ||
Revenue | 11,898 | 14,447 |
NGL Revenue | ||
Revenues: | ||
Revenue | 4,301 | 5,066 |
Other | ||
Revenues: | ||
Revenue | $ 4,941 | $ 3,521 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY - USD ($) $ in Thousands | Total | Common Stock | Preferred Stock | Additional Paid-in Capital | Accumulated Deficit |
Balance at Dec. 31, 2018 | $ 1,007,496 | $ 542 | $ 1,334,090 | $ (327,136) | |
Balance, shares at Dec. 31, 2018 | 54,155,768 | ||||
Equity based compensation | 2,126 | 2,126 | |||
Equity based compensation, Shares | 37 | ||||
Net income (loss) | (109,636) | (109,636) | |||
Balance at Mar. 31, 2019 | 899,986 | $ 542 | 1,336,216 | (436,772) | |
Balance, shares at Mar. 31, 2019 | 54,155,805 | ||||
Balance at Dec. 31, 2019 | $ 1,078,277 | $ 542 | 1,346,142 | (268,407) | |
Balance, shares at Dec. 31, 2019 | 54,197,004 | 54,197,004 | |||
Equity based compensation | $ 3,381 | 3,381 | |||
Equity based compensation, Shares | 200,077 | ||||
Shares withheld for taxes on equity transactions | (710) | (710) | |||
Shares withheld for taxes on equity transactions, Shares | (54,808) | ||||
Issuances of preferred shares | 156,200 | $ 1 | 156,199 | ||
Issuances of preferred shares, Shares | 110,000 | ||||
Conversion of preferred shares into common shares | $ 110 | $ (1) | (109) | ||
Conversion of preferred shares into common shares, Shares | 11,000,000 | (110,000) | |||
Net income (loss) | 157,749 | 157,749 | |||
Balance at Mar. 31, 2020 | $ 1,394,897 | $ 652 | $ 1,504,903 | $ (110,658) | |
Balance, shares at Mar. 31, 2020 | 65,342,273 | 65,342,273 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Cash flows from operating activities: | ||
Net income (loss) | $ 157,749 | $ (109,636) |
Adjustments to reconcile net income (loss) to net cash provided by operating activities | ||
Depreciation, depletion, amortization and accretion expense | 105,960 | 74,194 |
Write-down of oil and natural gas properties and other well inventory | 190 | |
Amortization of deferred financing costs and original issue discount | 1,466 | 1,188 |
Equity based compensation, net of amounts capitalized | 1,627 | 1,259 |
Price risk management activities expense (income) | (243,217) | 109,579 |
Net cash received (paid) on settled derivative instruments | 36,460 | (3,019) |
Settlement of asset retirement obligations | (6,302) | (3,945) |
Changes in operating assets and liabilities: | ||
Accounts receivable | (11,578) | 2,305 |
Other current assets | 18,318 | 11,370 |
Accounts payable | (18,547) | (8,284) |
Other current liabilities | 13,337 | (25,933) |
Other non-current assets and liabilities, net | 54,769 | (7,956) |
Net cash provided by operating activities | 110,232 | 41,122 |
Cash flows from investing activities: | ||
Exploration, development and other capital expenditures | (83,588) | (102,396) |
Cash paid for acquisitions, net of cash acquired | (293,095) | (32,916) |
Net cash provided by (used in) investing activities | (376,683) | (135,312) |
Cash flows from financing activities: | ||
Redemption of Senior Notes and other long-term debt | (109) | |
Proceeds from Bank Credit Facility | 300,000 | 35,000 |
Repayment of Bank Credit Facility | (25,000) | |
Deferred financing costs | (1,285) | |
Other deferred payments | (7,575) | (6,575) |
Payments of finance lease | (4,049) | (3,311) |
Employee stock transactions | (710) | |
Net cash provided by (used in) financing activities | 286,381 | 5 |
Net increase (decrease) in cash, cash equivalents and restricted cash | 19,930 | (94,185) |
Cash, cash equivalents and restricted cash: | ||
Balance, beginning of period | 87,022 | 141,162 |
Balance, end of period | 106,952 | 46,977 |
Supplemental Non-Cash Transactions: | ||
Capital expenditures included in accounts payable and accrued liabilities | 66,712 | 134,722 |
Supplemental Cash Flow Information: | ||
Interest paid, net of amounts capitalized | $ 4,906 | $ 4,614 |
Formation and Basis of Presenta
Formation and Basis of Presentation | 3 Months Ended |
Mar. 31, 2020 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Formation and Basis of Presentation | Note 1 — Formation and Basis of Presentation Formation and Nature of Business Talos Energy Inc. (“Talos” or the “Company”) is a technically driven independent exploration and production company focused on safely and efficiently maximizing value through it’s operations, currently in the United States (“U.S.”) Gulf of Mexico and offshore Mexico. The Company leverages decades of geology, geophysics and offshore operations expertise towards the acquisition, exploration, exploitation and development of assets in key geological trends that are present in many offshore basins around the world. Talos was formed in connection with the previously disclosed business combination between Talos Energy LLC and Stone Energy Corporation (“Stone”) that occurred on May 10, 2018, pursuant to which Talos Energy LLC and Stone became indirect wholly owned subsidiaries of Talos (the “Stone Combination”). Talos Energy LLC was formed in 2011 and commenced commercial operations on February 6, 2013. Prior to February 6, 2013, Talos Energy LLC had incurred certain general and administrative expenses associated with the start-up of its operations. On February 3, 2012, Talos Energy LLC completed a transaction with funds and other alternative investment vehicles managed by Apollo Management VII, L.P. and Apollo Commodities Management, L.P., with respect to Series I (“Apollo Funds”), and entities controlled by or affiliated with Riverstone Energy Partners V, L.P. (“Riverstone Funds” and, together with the Apollo Funds, the “Sponsors”) and members of management pursuant to which the Company received a private equity capital commitment. Basis of Presentation and Consolidation The condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the SEC regarding interim financial reporting. Accordingly, certain information and disclosures normally included in complete financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) have been condensed or omitted pursuant to such rules and regulations. In the opinion of management, these financial statements include all adjustments, which unless otherwise disclosed, are of a normal recurring nature, necessary for a fair presentation of the financial position, results of operations, cash flows and changes in equity for the periods presented. The results for interim periods are not necessarily indicative of results for the entire year. The Company has evaluated subsequent events through the date the condensed consolidated financial statements were issued. The unaudited financial statements and related notes included in this Quarterly Report on Form 10-Q should be read in conjunction with the Company’s audited Consolidated Financial Statements and related notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements, the reported amounts of revenues and expenses during the reporting periods and the reported amounts of proved oil and natural gas reserves. Actual results could differ from those estimates. As discussed in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019, operating expenses previously presented as “Direct lease operating expense,” “Insurance” and “Workover and maintenance expense” have been combined and presented as “Lease operating expense” on the Company’s Condensed Consolidated Statements of Operations. Such reclassification had no effect on the Company’s results of operations, financial position or cash flows. The Company has one reportable segment, which is the exploration and production of oil and natural gas. Substantially all the Company’s long-lived assets, proved reserves and production sales are related to the Company’s operations in the United States. Recently Adopted Accounting Standards Credit Risk Losses — In June 2016, the Financial Accounting Standards Board issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, which changes accounting requirements for the recognition of credit losses from an incurred or probable impairment methodology to a current expected credit losses (“CECL”) methodology. The CECL model is applicable to the measurement of credit losses on financial assets measured at amortized cost, including but not limited to trade receivables. The guidance was adopted on January 1, 2020 using a modified retrospective approach. The adoption of this guidance did not have a material effect on the Company’s condensed consolidated financial statements or related disclosures. Accounts receivable resulting from the sale of crude oil, NGL and natural gas production and joint interest billings to our partners for their share of expenses on joint venture projects for which we are the operator are the primary financial assets within the scope of the standard. Although these receivables are from a diverse group of companies, including major energy companies, pipeline companies and joint interest owners they are concentrated in the oil and gas industry. This concertation has the potential to impact our overall exposure to credit risk in that these companies may be similarly affected by changes in economic and financial conditions, commodity prices, or other conditions. A loss-rate methodology is used to estimate the allowance for expected credit losses to be accrued on material receivables to reflect the net amount to be collected. At each reporting period the loss-rate is determined utilizing historical data, current market conditions and reasonable and supported forecast of future economic conditions. Our allowance for uncollectable receivables was $9.9 million at March 31, 2020 and $9.9 million at December 31, 2019. |
Acquisitions
Acquisitions | 3 Months Ended |
Mar. 31, 2020 | |
Business Combinations [Abstract] | |
Acquisitions | Note 2 — Acquisitions Asset Acquisitions Acquisitions qualifying as an asset acquisition that requires, among other items that the cost of the assets acquired and liabilities assumed be recognized on the condensed consolidated balance sheet by allocating the asset cost on a relative fair value basis. The fair value measurements of the oil and natural gas properties acquired and asset retirement obligations assumed were derived utilizing an income approach and based, in part, on significant inputs not observable in the market. These inputs represent Level 3 measurements in the fair value hierarchy and include, but are not limited to, estimates of reserves, future operating and development costs, future commodity prices, estimated future cash flows and appropriate discount rates. These inputs required significant judgments and estimates by the Company’s management at the time of the valuation. Transaction costs incurred on an asset acquisition are capitalized as a component of the assets acquired and any contingent consideration is recognized as the contingency is resolved. Acquisition of Gunflint Field — On January 11, 2019, the Company completed the acquisition of an approximate 9.6% non-operated working interest in the Gunflint Field located in the Mississippi Canyon area (the “Gunflint Acquisition”) from Samson Offshore Mapleleaf, LLC for $29.6 million ($27.9 million after customary purchase price adjustments). The following table presents the allocation of the purchase price to the assets acquired and liabilities assumed, based on their relative fair values, on January 11, 2019 (in thousands): Property and equipment $ 28,912 Asset retirement obligations (996 ) Allocated purchase price $ 27,916 Business Combination Acquisitions qualifying as business combinations are accounted for under the acquisition method of accounting, which requires, among other items, that assets acquired and liabilities assumed be recognized on the condensed consolidated balance sheet at their fair values as of the acquisition date. The fair value measurements of the oil and natural gas properties acquired and asset retirement obligations assumed were derived utilizing an income approach and based, in part, on significant inputs not observable in the market. These inputs represent Level 3 measurements in the fair value hierarchy and include, but are not limited to, estimates of reserves, future operating and development costs, future commodity prices, estimated future cash flows and appropriate discount rates. These inputs required significant judgments and estimates at the time of the valuation. ILX and Castex Acquisition — On February 28, 2020, the Company acquired the outstanding limited liability interests in certain wholly owned subsidiaries of ILX Holdings, LLC, ILX Holdings II, LLC, ILX Holdings III LLC and Castex Energy 2014, LLC, each a related party and an affiliate of the Riverstone Funds (the “Riverstone Sellers”), and Castex Energy 2016, LP (together with the Riverstone Sellers, the “Sellers”) with an effective date of July 1, 2019 (collectively, the “ILX and Castex Acquisition ” ). The ILX and Castex Acquisition was consummated pursuant to separate Purchase and Sale Agreements, dated December 10, 2019 (as amended from time to time, the “Purchase Agreements”) for aggregate consideration consisting of (i) $ 385.0 million in cash subject to customary closing adjustments and (ii) an aggregate shares (the “Preferred Shares”) of a series of the Company’s preferred stock designated as “Series A Convertible Preferred Stock” which subsequently converted to 11.0 million shares of the Company’s common stock on March 30, 2020 (such common stock, the “Conversion Stock ” ). The cash payment and escrow deposit were funded with borrowings under the Bank Credit Facility (as defined below) . The following table summarizes the purchase price, subject to customary post-closing adjustments (in thousands except per share data): Talos Conversion Stock 11,000 Talos common stock price per share (1) $ 14.20 Conversion Stock value $ 156,200 Cash consideration $ 385,000 Customary closing adjustments (91,905 ) Net cash consideration paid at closing $ 293,095 Total purchase price $ 449,295 (1) Represents the closing price of the Company’s common stock on February 28, 2020, the date of the closing of the ILX and Castex Acquisition. The purchase price was based on the value of the Conversion Stock as the value approximates the value of the Preferred Shares as a result of the automatic conversion and dividend rights described in that certain Certificate of Designation, Preferences, Rights and Limitations. While the Company has substantially completed the determination of the fair values of the assets acquired and liabilities assumed, the Company is still finalizing the fair value analysis related to the oil and natural gas properties acquired and asset retirement obligations assumed. The Company anticipates finalizing the determination of fair values by December 31, 2020. The following table presents the preliminary allocation of the purchase price to the assets acquired and liabilities assumed, based on their fair values on February 28, 2020 (in thousands): February 28, 2020 Current assets (1) $ 10,969 Property and equipment 489,796 Other long-term assets 148 Current liabilities (7,129 ) Long-term debt - Other long-term liabilities (44,489 ) Allocated purchase price $ 449,295 (1) The Company incurred approximately $10.9 million of transaction related costs, of which $7.5 million was recognized in the first quarter of 2020 and $3.4 million was recognized in the fourth quarter of 2019 and reflected in general and administrative expense on the condensed consolidated statements of operations. The follow ing table presents revenue and net income attributable to the assets acquired in the ILX and Castex Acquisition for th e three months ended March 31, 2020 : Three Months Ended March 31, 2020 Revenue $ 13,892 Net income $ 3,209 Pro Forma Financial Information (Unaudited) — The following supplemental pro forma financial information (in thousands, except per common share amounts), presents the condensed consolidated results of operations for the three months ended March 31, 2020 and 2019 as if the ILX and Castex Acquisition had occurred on January 1, 2019. The unaudited pro forma information was derived from historical statements of operations of the Company and the Sellers adjusted to (i) include depletion expense applied to the adjusted basis of the oil and natural gas properties acquired, (ii) include interest expense to reflect borrowings under the Bank Credit Facility, (iii) eliminate the write-down of oil and natural gas properties on the assets acquired to reflect the pro-forma ceiling test calculation and (iv) include weighted average basic and diluted shares of common stock outstanding, which was calculated assuming the 11.0 million shares of Conversion Stock were issued to the Sellers. This information does not purport to be indicative of results of operations that would have occurred had the ILX and Castex Acquisition occurred on January 1, 2019, nor is such information indicative of any expected future results of operations. Three Months Ended March 31, 2020 2019 Revenue $ 235,199 $ 260,971 Net income (loss) $ 167,566 $ (79,448 ) Basic net income (loss) per common share $ 2.56 $ (1.22 ) Diluted net income (loss) per common share $ 2.55 $ (1.22 ) |
Property, Plant and Equipment
Property, Plant and Equipment | 3 Months Ended |
Mar. 31, 2020 | |
Oil And Gas Property [Abstract] | |
Property, Plant and Equipment | Note 3 — Property, Plant and Equipment Proved Properties The Company’s interests in oil and natural gas proved properties are located in the United States, primarily in the Gulf of Mexico deep and shallow waters. The Company follows the full cost method of accounting for its oil and natural gas exploration and development activities. During the three months ended March 31, 2020 and 2019, the Company’s ceiling test computation did not result in a write-down of its U.S. oil and natural gas properties. At March 31, 2020, the Company’s ceiling test computation was based on SEC pricing of $60.10 per Bbl of oil, $2.36 per Mcf of natural gas and $15.62 per Bbl of NGLs. Unproved Properties Unproved capitalized costs of oil and natural gas properties excluded from amortization relate to unevaluated properties associated with acquisitions, leases awarded in the U.S. Gulf of Mexico federal lease sales, certain geological and geophysical costs, expenditures associated with certain exploratory wells in progress and capitalized interest. Unproved properties also include expenditures associated with exploration and appraisal activities in Block 7 and Block 31 located in the shallow waters off the coast of Mexico’s Veracruz and Tabasco states. Capitalized Overhead General and administrative expense in the Company’s financial statements is reflected net of capitalized overhead. The Company capitalizes overhead costs directly related to exploration, acquisition and development activities. Capitalized overhead for the three months ended March 31, 2020 and 2019 was $7.0 million and $6.6 million, respectively. Asset Retirement Obligations The discounted asset retirement obligations included in the condensed consolidated balance sheets in current and non-current liabilities, and the changes in that liability during the three months ended March 31, 2020 were as follows (in thousands): Asset retirement obligations at January 1 $ 369,478 Fair value of asset retirement obligations acquired (1) 44,489 Obligations settled (6,302 ) Accretion expense 12,417 Changes in estimate 5,814 Asset retirement obligations at March 31 $ 425,896 Less: Current portion (38,028 ) Long-term portion $ 387,868 (1) Three months ended March 31, 2020 includes $44.5 million of asset retirement obligations assumed in the ILX and Castex Acquisition. |
Leases
Leases | 3 Months Ended |
Mar. 31, 2020 | |
Leases [Abstract] | |
Leases | Note 4 — Leases The Company enters into service contracts and other contractual arrangements for the use of office space, drilling, completion and abandonment equipment (e.g., drilling rigs), production related equipment (e.g., compressors) and other equipment from third-party lessors to support its operations. The Company’s leasing activities as a lessor are negligible. At inception, contracts are reviewed to determine whether the agreement contains a lease. To the extent an arrangement is determined to include a lease, it is classified as either an operating or a finance lease, which dictates the pattern of expense recognition in the income statement. The amounts disclosed herein primarily represent costs associated with properties operated by the Company that are presented on a gross basis and do not reflect the Company’s net proportionate share of such amounts. A portion of these costs have been or will be billed to other working interest owners. The Company’s share of these costs is included in property and equipment, lease operating expense or general and administrative expense depending on how the leased asset is utilized. The components of lease costs were as follows (in thousands): Three Months Ended March 31, 2020 2019 Finance lease cost - interest on lease liabilities (1) $ 4,265 $ 4,994 Operating lease cost, excluding short-term leases (2) 866 763 Short-term lease cost (3) 3,535 36,609 Variable lease cost (4) 3 2 Total lease cost $ 8,669 $ 42,368 (1) The Helix Producer I (the “HP-I”) is utilized in the Company’s oil and natural gas development activities and the right-of-use asset was capitalized and included in proved property and depleted as part of the full cost pool. Once items are included in the full cost pool, they are indistinguishable from other proved properties. The capitalized costs within the full cost pool are amortized over the life of the total proved reserved using the unit-of-production method, computed quarterly. (2) Operating lease cost reflect a single lease cost, calculated so that the cost of the lease is allocated over the lease term on a straight-line basis. (3) Short-term lease costs are reported at gross amounts and primarily represent costs incurred for drilling rigs, most of which are short-term contracts not recognized as a right-of-use asset and lease liability on the balance sheet. (4) Variable lease costs primarily represent differences between minimum payment obligations and actual operating charges incurred by the Company related to its long-term leases. The present value of the fixed lease payments recorded as the Company’s right-of-use asset and liability, adjusted for initial direct costs and incentives, are as follows (in thousands): March 31, 2020 December 31, 2019 Operating leases: Operating lease assets $ 7,590 $ 7,779 Current portion of operating lease liabilities $ 1,613 $ 1,594 Operating lease liabilities 19,138 17,239 Total operating lease liabilities $ 20,751 $ 18,833 Finance leases: Proved property (1) $ 124,299 $ 124,299 Other current liabilities $ 18,519 $ 17,509 Other long-term liabilities 56,967 62,026 Total finance lease liabilities $ 75,486 $ 79,535 (1) The HP-I is utilized in the Company’s oil and natural gas development activities and the right-of-use asset was capitalized and included in proved property and depleted as part of the full cost pool. Once items are included in the full cost pool, they are indistinguishable from other proved properties. The capitalized costs within the full cost pool are amortized over the life of the total proved reserves using the unit-of-production method, computed quarterly. The table below presents the lease maturity by year as of March 31, 2020 (in thousands). Such commitments are reflected at undiscounted values and are reconciled to the discounted present value recognized on the condensed consolidated balance sheet. Operating Leases Finance Leases 2020 (excluding the three months ended March 31, 2020) $ 2,289 $ 24,943 2021 4,079 33,257 2022 4,302 33,257 2023 4,239 13,857 2024 3,314 — Thereafter 15,790 — Total lease payments $ 34,013 $ 105,314 Imputed interest (13,262 ) (29,828 ) Total $ 20,751 $ 75,486 The table below presents the weighted average remaining lease term and discount rate related to leases for the three months ended March 31, 2020 and 2019: Three Months Ended March 31, 2020 2019 Weighted average remaining lease term: Operating leases 8.3 years 6.0 years Finance leases 3.2 years 4.0 years Weighted average discount rate: Operating leases 10.3 % 11.6 % Finance leases 21.9 % 21.9 % The table below presents the supplemental cash flow information related to leases for the three months ended March 31, 2020 and 2019 (in thousands): Three Months Ended March 31, 2020 2019 Operating cash outflow from finance leases $ 4,265 $ 4,994 Financing cash outflow from finance leases $ 4,049 $ 3,311 Operating cash outflow from operating leases $ 455 $ 453 Right-of-use assets obtained in exchange for new finance lease liabilities $ — $ — Right-of-use assets obtained in exchange for new operating lease liabilities $ — $ 613 |
Financial Instruments
Financial Instruments | 3 Months Ended |
Mar. 31, 2020 | |
Financial Instruments [Abstract] | |
Financial Instruments | Note 5 — Financial Instruments The following table presents the carrying amounts and estimated fair values of the Company’s financial instruments (in thousands): March 31, 2020 December 31, 2019 Carrying Amount Fair Value Carrying Amount Fair Value 11.00% Second-Priority Senior Secured Notes – due April 2022 (1) $ 384,571 $ 240,384 $ 383,871 $ 401,128 7.50% Senior Notes – due May 2022 $ 6,060 $ 3,030 $ 6,060 $ 5,030 Bank Credit Facility – matures May 2022 (1) $ 642,531 $ 650,000 $ 343,050 $ 350,000 Oil and Natural Gas Derivatives $ 195,163 $ 195,163 $ (11,594 ) $ (11,594 ) (1) As of March 31, 2020 and December 31, 2019, the carrying amounts of cash and cash equivalents, accounts receivable and accounts payable approximate their fair values because of the short-term nature of these instruments. 11.00% Second-Priority Senior Secured Notes – due April 2022 The $390.9 million aggregate principal amount of 11.00% Second-Priority Senior Secured Notes (the “11.00% Notes”) is reported on the condensed consolidated balance sheet at its carrying value, net of original issue discount and deferred financing costs, see Note 6 — Debt 7.50% Senior Notes – due May 2022 The $6.1 million aggregate principal amount of 7.50% Senior Notes (the “7.50% Notes”) is reported on the condensed consolidated balance sheet as of March 31, 2020 at its carrying value, see Note 6 — Debt Bank Credit Facility – matures May 2022 The Company and Talos Production Inc., a wholly-owned subsidiary that was formerly known as Talos Production LLC, maintains a bank credit facility with a borrowing base of $1.15 billion at March 31, 2020 (the “Bank Credit Facility”), which is reported on the condensed consolidated balance sheet at its carrying value net of deferred financing costs (see Note 6 – Debt Oil and natural gas derivatives The Company attempts to mitigate a portion of its commodity price risk and stabilize cash flows associated with sales of oil and natural gas production through the use of oil and natural gas swaps and costless collars. Swaps are contracts where the Company either receives or pays depending on whether the oil or natural gas floating market price is above or below the contracted fixed price. Costless collars consist of a purchased put option and a sold call option with no net premiums paid to or received from counterparties. Collar contracts typically require payments by the Company if the NYMEX average closing price is above the ceiling price or payments to the Company if the NYMEX average closing price is below the floor price. The Company has elected not to designate any of its derivative contracts for hedge accounting. Accordingly, commodity derivatives are recorded on the condensed consolidated balance sheet at fair value with settlements of such contracts, and changes in the unrealized fair value, recorded as price risk management activities income (expense) on the condensed consolidated statements of operations in each period. The following table presents the impact that derivatives, not qualifying as hedging instruments, had on its condensed consolidated statements of operations (in thousands): Three Months Ended March 31, 2020 2019 Net cash received (paid) on settled derivative instruments $ 36,460 $ (3,019 ) Unrealized gain (loss) 206,757 (106,560 ) Price risk management activities income (expense) $ 243,217 $ (109,579 ) The following table reflects the contracted volumes and weighted average prices the Company will receive under the terms of its derivative contracts as of March 31, 2020: Production Period Instrument Type Average Daily Volumes Weighted Average Swap Price Weighted Average Put Price Weighted Average Call Price Crude Oil – WTI: (Bbls) (per Bbl) (per Bbl) (per Bbl) April 2020 – December 2020 Swap 30,320 $ 47.94 $ — $ — January 2021 – December 2021 Swap 4,230 $ 45.90 $ — $ — April 2020 – December 2020 Collar 5,000 $ — $ 50.00 $ 57.09 January 2021 – December 2021 Collar 1,000 $ — $ 30.00 $ 40.00 Natural Gas – NYMEX Henry Hub: (MMBtu) (per MMBtu) (per MMBtu) (per MMBtu) April 2020 – December 2020 Swaps 26,000 $ 2.23 $ — $ — January 2021 – December 2021 Swaps 30,000 $ 2.40 $ — $ — The following tables provide additional information related to financial instruments measured at fair value on a recurring basis (in thousands): March 31, 2020 Level 1 Level 2 Level 3 Total Assets: Oil and natural gas swaps and costless collars $ — $ 201,347 $ — $ 201,347 Liabilities: Oil and natural gas swaps and costless collars — (6,184 ) — (6,184 ) Total net asset $ — $ 195,163 $ — $ 195,163 December 31, 2019 Level 1 Level 2 Level 3 Total Assets: Oil and natural gas swaps and costless collars $ — $ 8,393 $ — $ 8,393 Liabilities: Oil and natural gas swaps and costless collars — (19,987 ) — (19,987 ) Total net liability $ — $ (11,594 ) $ — $ (11,594 ) Financial Statement Presentation Derivatives are classified as either current or non-current assets or liabilities based on their anticipated settlement dates. Although the Company has master netting arrangements with its counterparties, the Company presents its derivative financial instruments on a gross basis in its condensed consolidated balance sheets. On derivative contracts recorded as assets in the table below, the Company is exposed to the risk the counterparties may not perform. The following table presents the fair value of derivative financial instruments at March 31, 2020 and December 31, 2019 (in thousands): March 31, 2020 December 31, 2019 Assets Liabilities Assets Liabilities Oil and natural gas derivatives: Current $ 192,553 $ 4,286 $ 8,393 $ 19,476 Non-current 8,794 1,898 — 511 Total $ 201,347 $ 6,184 $ 8,393 $ 19,987 Credit Risk The Company is subject to the risk of loss on its financial instruments as a result of nonperformance by counterparties pursuant to the terms of their contractual obligations. The Company entered into International Swaps and Derivative Association agreements with counterparties to mitigate this risk. The Company also maintains credit policies with regard to its counterparties to minimize overall credit risk. These policies require (i) the evaluation of potential counterparties’ financial condition to determine their credit worthiness; (ii) the regular monitoring of counterparties’ credit exposures; (iii) the use of contract language that affords the Company netting or set off opportunities to mitigate exposure risk; and (iv) potentially requiring counterparties to post cash collateral, parent guarantees, or letters of credit to minimize credit risk. The Company’s assets and liabilities from commodity price risk management activities at March 31, 2020 represent derivative instruments from ten counterparties; all of which are registered swap dealers that have an “investment grade” (minimum Standard & Poor’s rating of BBB- or better) credit rating, and all of which are parties under the Company’s Bank Credit Facility. The Company enters into derivatives directly with these counterparties and, subject to the terms of the Company’s Bank Credit Facility, is not required to post collateral or other securities for credit risk in relation to the derivative activities. |
Debt
Debt | 3 Months Ended |
Mar. 31, 2020 | |
Debt Disclosure [Abstract] | |
Debt | Note 6 — Debt A summary of the detail comprising the Company’s debt and the related book values for the respective periods presented is as follows (in thousands): March 31, 2020 December 31, 2019 11.00% Second-Priority Senior Secured Notes – due April 2022 $ 390,868 $ 390,868 7.50% Senior Notes – due May 2022 6,060 6,060 Bank Credit Facility – matures May 2022 650,000 350,000 Total debt, before discount and deferred financing cost 1,046,928 746,928 Discount and deferred financing cost (13,766 ) (13,947 ) Total debt, net of discount and deferred financing costs $ 1,033,162 $ 732,981 11.00% Second-Priority Senior Secured Notes – due April 2022 The 11.00% Notes were issued pursuant to an indenture dated May 10, 2018, between Talos Production Inc. (formerly Talos Production LLC) and Talos Production Finance Inc., the subsidiary guarantors party thereto and Wilmington Trust, National Association, as trustee and collateral agent. The 11.00% Notes mature April 3, 2022 and have interest payable semi-annually each April 15 and October 15. Prior to May 10, 2020, the Company may, at its option, redeem all or a portion of the 11.00% Notes at 105.5% of the principal amount plus accrued and unpaid interest and a make-whole premium. Thereafter, the Company may redeem all or a portion of the 11.00% Notes at redemption prices decreasing annually at May 10 from 102.75% to 100.0% plus accrued and unpaid interest. The indenture governing the 11.00% Notes applies certain limitations on the Company’s ability and the ability of its subsidiaries to, among other things, (i) incur additional indebtedness or issue certain preferred shares; (ii) pay dividends and make certain other restricted payments; (iii) create restrictions on the payment of dividends or other distributions to the Company from its restricted subsidiaries; (iv) create liens on certain assets to secure debt; (v) make certain investments; (vi) engage in sales of assets and subsidiary stock; (vii) transfer all or substantially all of its assets or enter into merger or consolidation transactions; and (viii) engage in transactions with affiliates. The 11.00% Notes contain customary quarterly and annual reporting, financial and administrative covenants. The Company was in compliance with all debt covenants at March 31, 2020. 7.50% Senior Notes – due May 2022 The 7.50% Notes represent the remaining $6.1 million of long-term debt assumed in the Stone Combination that were not exchanged for 11.00% Notes pursuant to the exchange offer and consent solicitation, and thus remain outstanding. As a result of the exchange offer and consent solicitation, substantially all of the restrictive covenants relating to the 7.50% Notes have been removed and collateral securing the 7.50% Notes has been released. The 7.50% Notes mature May 31, 2022 and have interest payable semi-annually each May 31 and November 30. Prior to May 31, 2020, the Company may, at its option, redeem up to 35% of the 7.50% Notes at 107.5% of the principal amount plus accrued and unpaid interest and a make-whole premium. Thereafter, the Company may redeem all or a portion of the 7.50% Notes at redemption prices decreasing annually at May 31 from 105.625% to 100.0% plus accrued and unpaid interest. Bank Credit Facility – matures May 2022 The Company and Talos Production Inc. maintain a Bank Credit Facility with a syndicate of financial institutions, with a borrowing base of $1.15 billion as of March 31, 2020. The Bank Credit Facility matures on May 10, 2022, provided that the Bank Credit Facility mandates a springing maturity that is 120 days prior to May 10, 2022, if greater than $25.0 million of the 11.00% Notes or any permitted refinancing indebtedness in respect thereof is outstanding on such date. The Bank Credit Facility bears interest based on the borrowing base usage, at the applicable London InterBank Offered Rate, plus applicable margins ranging from 2.75% to 3.75% or an alternate base rate, based on the federal funds effective rate plus applicable margins ranging from 1.75% to 2.75%. In addition, the Company is obligated to pay a commitment fee of 0.50% on the unutilized portion of the commitments. The Bank Credit Facility has certain debt covenants, the most restrictive of which is that the Company must maintain a total debt to EBITDAX Ratio (as defined in the Bank Credit Facility) of no greater than 3.00 to 1.00 each quarter. The Company must also maintain a current ratio no less than 1.00 to 1.00 each quarter. According to the Bank Credit Facility, unutilized commitments are included in current assets in the current ratio calculation. The Bank Credit Facility is secured by substantially all of the oil and natural gas assets of the Company. The Bank Credit Facility is fully and unconditionally guaranteed by the Company and certain of its wholly-owned subsidiaries. The Bank Credit Facility provides for determination of the borrowing base based on the Company’s proved producing reserves and a portion of its proved undeveloped reserves. The borrowing base is redetermined by the lenders at least semi-annually during the second quarter and fourth quarter. Upon closing of the ILX and Castex Acquisition on February 28, 2020, As of March 31, 2020, the Company’s maximum borrowing base and commitments were $1.15 billion |
Employee Benefits Plans and Sha
Employee Benefits Plans and Share-Based Compensation | 3 Months Ended |
Mar. 31, 2020 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Employee Benefits Plans and Share-Based Compensation | Note 7 — Employee Benefits Plans and Share-Based Compensation Talos Energy Inc. Long Term Incentive Plan Under the Talos Energy Inc. Long Term Incentive Plan (the “LTIP”), the Company may issue, subject to approval by the Talos board of directors, grants of options, stock appreciation rights, restricted stock, restricted stock units, stock awards, dividend equivalents, other stock-based awards, cash awards, substitute awards or any combination of the foregoing to employees, directors and consultants. The LTIP authorizes the Company to grant awards of up to 5,415,576 shares of the Company’s common stock. Restricted Stock Units (“RSUs”) — The following table summarizes RSU activity for the three months ended March 31, 2020 : Restricted Stock Units Weighted Average Grant Date Fair Value Unvested RSUs at December 31, 2019 733,777 $ 25.20 Granted 1,278,095 $ 10.04 Vested (225,507 ) $ 24.36 Forfeited (36,677 ) $ 24.72 Unvested RSUs at March 31, 2020 1,749,688 $ 14.24 Performance Share Units (“PSUs”) — The following table summarizes PSU activity for the three months ended March 31, 2020: Restricted Stock Units Weighted Average Grant Date Fair Value Unvested PSUs at December 31, 2019 417,831 $ 39.31 Granted 441,642 $ 13.05 Vested — $ — Forfeited (18,533 ) $ 35.74 Unvested PSUs at March 31, 2020 840,940 $ 25.60 The grant date fair value of the PSUs granted during the three months ended March 31, 2020, calculated using a Monte Carlo simulation, was $5.8 million. The following table summarizes the assumptions used to calculate the grant date fair value of the PSUs granted for the three months ended March 31, 2020: 2020 Grant Date March 5, 2020 Number of simulations 100,000 Expected term (in years) 2.8 Expected volatility 48.8 % Risk-free interest rate 0.6 % Dividend yield — % Share-based Compensation Expense, net Share-based compensation expense associated with RSUs, PSUs and Series B Units are reflected as general and administrative expense, net amounts capitalized to oil and gas properties, in the condensed consolidated statement of operations. Because of the non-cash nature of share-based compensation, the expensed portion of share-based compensation is added back to net income in arriving at net cash used in or provided by operating activities in the consolidated statement of cash flows. For the three months ended March 31, 2020 , share-based compensation expense did not have any associated income tax benefit. The Company recognized the following share-based compensation e xpense, net for the three months ended March 31, 2020 and 2019 (in thousands): Three Months Ended March 31, 2020 2019 Share-based compensation expense $ 3,212 $ 2,275 Less: amounts capitalized to oil and gas properties (1,585 ) (1,016 ) Total share-based compensation expense, net $ 1,627 $ 1,259 |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Note 8 — Income Taxes The Company is a corporation that is subject to U.S. federal, state and foreign income taxes. For the three months ended March 31, 2020, the Company recognized income tax expense of $55.3 million for an effective tax rate of 25.9%. The difference between the Company’s effective tax rate of 25.9% and the U.S. federal statutory income tax rate of 21% is primarily due to state income taxes. For the three months ended March 31, 2019, the Company recognized income tax benefit of $6.4 million for an effective tax rate of 5.5%. The difference between the Company’s effective tax rate of 5.5% and U.S. federal statutory income tax rate of 21% is primarily due to a reduction to the Company’s valuation allowance. The Company evaluates and updates the estimated annual effective income tax rate on a quarterly basis based on current and forecasted operating results and tax laws. Consequently, based upon the mix and timing of the Company’s actual earnings compared to annual projections, the effective tax rate may vary quarterly and may make quarterly comparisons not meaningful. The quarterly income tax provision is generally comprised of tax expense on income or benefit on loss at the most recent estimated annual effective tax rate. The tax effect of discrete items is recognized in the period in which they occur at the applicable statutory rate. Deferred income tax assets and liabilities are recorded related to net operating losses and temporary differences between the book and tax basis of assets and liabilities expected to produce deductions and income in the future. The Company reduces deferred tax assets by a valuation allowance when, based on estimates, it is more likely than not that a portion of those assets will not be realized in a future period. The deferred tax asset estimates are subject to revision, either up or down, in future periods based on new facts or circumstances. In evaluating the Company’s valuation allowance, the Company considers cumulative losses, the reversal of existing temporary differences, the existence of taxable income in carryback years, tax optimization planning and future taxable income for each of its taxable jurisdictions. Changes to the Company’s assessment of its valuation allowance could materially impact its results of operations. As March 31, 2020, the Company had a valuation allowance related to state and foreign deferred tax assets. |
Income (Loss) Per Share
Income (Loss) Per Share | 3 Months Ended |
Mar. 31, 2020 | |
Earnings Per Share [Abstract] | |
Income (Loss) Per Share | Note 9 — Income (Loss) Per Share Basic earnings per common share is computed by dividing net income (loss) attributable to common stockholders by the weighted average number of shares of common stock outstanding during the period. Except when the effect would be antidilutive, diluted earnings per common share includes the impact of RSUs, PSUs and outstanding warrants. The following table presents the computation of the Company’s basic and diluted income (loss) per share were as follows (in thousands, except for the per share amounts): Three Months Ended March 31, 2020 2019 Net income (loss) $ 157,749 $ (109,636 ) Weighted average common shares outstanding — basic 58,240 54,156 Dilutive effect of securities 332 — Weighted average common shares outstanding — diluted 58,572 54,156 Net income (loss) per common share: Basic $ 2.71 $ (2.02 ) Diluted $ 2.69 $ (2.02 ) Anti-dilutive potentially issuable securities excluded from diluted common shares 4,358 4,762 |
Related Party Transactions
Related Party Transactions | 3 Months Ended |
Mar. 31, 2020 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Note 10 — Related Party Transactions ILX and Castex Acquisition On February 28, 2020 the Company acquired assets and liabilities at fair value from the Riverstone Sellers, affiliates of the Riverstone Funds, for $449.3 million (comprised of $293.1 million in net cash paid and $156.2 million in Conversion Stock). See additional details in Note 2 — Acquisitions Whistler Acquisition On August 31, 2018, the Company acquired certain properties from Whistler Energy II Holdco, LLC, an affiliate of the Apollo Funds, for $52.6 million ($14.8 million net of $37.8 million of cash acquired). Included in current assets acquired as of March 31, 2020 is $1.1 million in receivables from an affiliate of the Apollo Funds to reimburse the Company for certain payments made post-closing. Equity Registration Rights Agreement On May 10, 2018, the Company entered into a Registration Rights Agreement (the “Original Equity Registration Rights Agreement”) with certain of the Apollo Funds and the Riverstone Funds, certain funds controlled by Franklin Advisers, Inc. (“Franklin”) and certain clients of MacKay Shields LLC (“MacKay Shields”), The Company and the Riverstone Sellers (and their designated affiliates) agreed under the Purchase Agreements to enter into an amendment to the Original Equity Registration Rights Agreement (such amendment, the “Registration Rights Agreement Amendment,” and the Original Equity Registration Rights Agreement, as amended by the Registration Rights Agreement Amendment, the “Registration Rights Agreement”). The Registration Rights Agreement Amendment will add each of the Riverstone Sellers (or one or more of its designated affiliates) as parties to the Registration Rights Agreement and provide such parties with customary registration rights with respect to the Series A Convertible Preferred Stock (and Conversion Stock) that the Riverstone Sellers received at the closing of the ILX and Castex Acquisition (the “New Registrable Securities” and together with the Original Registrable Securities, the “Registrable Securities”). Under the Registration Rights Agreement, the Company is required to file a shelf registration statement within 30 days of the Company’s receipt of written request by a holder of Registrable Securities (a “Holder”). Each Holder will be limited to two demand registrations in any twelve-month period. The Holders have the right to request that we initiate underwritten offerings of the Company’s common stock; provided, that the Apollo Funds and the Riverstone Funds will have the right to demand three underwritten offerings in any twelve-month period, and Franklin and MacKay Shields will only have the collective right to demand one underwritten offering. The Holders have customary piggyback rights with respect to any underwritten offering that we conduct for as long as the Holders and their respective affiliates own 5% of the Registrable Securities. Each Holder will agree to a lock up with underwriters in the event of an underwritten offering, provided that the lock up will not apply to any Holder who does not have a right to participate in such underwritten offering. The Registration Rights Agreement has terminated with respect to Franklin and will terminate with respect to MacKay Shields in the event that MacKay Shields ceases to beneficially own 5% or more of the then outstanding shares of the Company’s common stock. The Registration Rights Agreement will otherwise terminate at such time as there are no Registrable Securities outstanding. In connection with the closing of the ILX and Castex Acquisition, and pursuant to the Purchase Agreements, as amended, the Company and ILX Holdings, LLC, ILX Holdings II, LLC, ILX Holdings III LLC and Riverstone V Castex 2014 Holdings, L.P., a Delaware limited partnership and designee of Castex Energy 2014, LLC, entered into the Registration Rights Agreement Amendment to the Registration Rights Agreement to, among other things, add each of the Riverstone Sellers (or one or more of its designated affiliates) as parties to the Registration Rights Agreement and provide such parties with customary registration rights with respect to the Company’s Series A Convertible Preferred Stock issued to the Riverstone Sellers at the closing of the ILX and Castex Acquisition. The Company will bear all of the expenses incurred in connection with the offer and sale, while the Apollo Funds, the Riverstone Funds, Franklin and MacKay Shields will be responsible for paying underwriting fees, discounts and selling commissions. Fees incurred by the Company in conjunction with the Original Equity Registration Rights Agreement were $0.2 million and $0.6 million for the three months ended March 31, 2020 and 2019, respectively. Stockholders’ Agreement Amendment On May 10, 2018, the Company entered into a Stockholders’ Agreement (the “Stockholders’ Agreement”) by and among the Company and the other parties thereto. On February 24, 2020, the Company and the other parties thereto amended the Stockholders’ Agreement (the “Stockholders’ Agreement Amendment”) to, among other things, add each of the Riverstone Sellers (or one or more of its designated affiliates) as parties to the Stockholders’ Agreement and provide that for purposes of determining whether the Riverstone Sellers and their affiliates continue to satisfy certain stock ownership requirements necessary to retain their rights to nominate directors to the board of directors, the Series A Convertible Preferred Stock owned by the Riverstone Sellers was, prior to the conversion thereof, counted towards such ownership requirements on an as converted basis at the closing of the ILX and Castex Acquisition. On March 30, 2020, all 110,000 shares of Series A Convertible Preferred Stock were converted into an aggregate 11.0 million shares of the Company’s common stock. Legal Fees The Company has engaged the law firm Vinson & Elkins L.L.P. to provide legal services. An immediate family member of William S. Moss III, the Company’s Executive Vice President and General Counsel and one of its executive officers, is a partner at Vinson & Elkins L.L.P. For the three months ended March 31, 2020 and 2019 approximately |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2020 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 11 — Commitments and Contingencies Performance Obligations Regulations with respect to offshore operations govern, among other things, engineering and construction specifications for production facilities, safety procedures, plugging and abandonment of wells, removal of facilities and to guarantee the execution of the minimum work program under the Mexico production sharing contracts. As of March 31, 2020, the Company had secured performance bonds totaling approximately $669.3 million. As of March 31, 2020, the Company had $13.6 million in letters of credit issued under its Bank Credit Facility. Legal Proceedings and Other Contingencies The Company is named as a party in certain lawsuits and regulatory proceedings arising in the ordinary course of business. The Company does not expect that these matters, individually or in the aggregate, will have a material adverse effect on its financial condition. |
Condensed Consolidating Financi
Condensed Consolidating Financial Information | 3 Months Ended |
Mar. 31, 2020 | |
Condensed Financial Information Of Parent Company Only Disclosure [Abstract] | |
Condensed Consolidating Financial Information | Note 12 — Condensed Consolidating Financial Information Talos Energy Inc. owns no operating assets and has no operations independent of its subsidiaries. Talos Production Inc. (formerly Talos Production LLC) and Talos Production Finance Inc. issued 11.00% Notes on May 10, 2018, which are fully and unconditionally guaranteed, jointly and severally, by Talos Energy Inc. and certain 100% owned subsidiaries on a senior unsecured basis. The following condensed consolidating financial information presents the financial information of the Company on an unconsolidated stand-alone basis and its combined guarantor and combined non-guarantor subsidiaries as of and for the period indicated. Such financial information may not necessarily be indicative of the Company’s results of operations, cash flows or financial position had these subsidiaries operated as independent entities. TALOS ENERGY INC. CONDENSED CONSOLIDATING BALANCE SHEET AS OF March 31, 2020 (In thousands) (Unaudited) Parent Subsidiary Issuers Guarantors Non- Guarantors Elimination Consolidated ASSETS Current assets: Cash and cash equivalents $ — $ 88,453 $ 5,231 $ 13,268 $ — $ 106,952 Accounts receivable Trade, net — — 81,027 — — 81,027 Joint interest, net — — 26,906 5,988 — 32,894 Other — 28,153 8,097 306 — 36,556 Assets from price risk management activities — 192,553 — — — 192,553 Prepaid assets — 2,809 47,442 22 — 50,273 Other current assets 53 — 1,993 — — 2,046 Total current assets 53 311,968 170,696 19,584 — 502,301 Property and equipment: Proved properties — — 4,538,100 — — 4,538,100 Unproved properties, not subject to amortization — — 166,450 110,600 — 277,050 Other property and equipment — 24,920 6,829 217 — 31,966 Total property and equipment — 24,920 4,711,379 110,817 — 4,847,116 Accumulated depreciation, depletion and amortization — (11,728 ) (2,146,773 ) (65 ) — (2,158,566 ) Total property and equipment, net — 13,192 2,564,606 110,752 — 2,688,550 Other long-term assets: Assets from price risk management activities — 8,794 — — — 8,794 Other well equipment inventory — — 9,178 — — 9,178 Operating lease assets — 3,314 3,030 1,246 — 7,590 Investments in subsidiaries 1,417,909 2,167,746 — — (3,585,655 ) — Other assets 1 364 2,396 19,013 — 21,774 1,417,963 2,505,378 2,749,906 150,595 (3,585,655 ) 3,238,187 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable 564 5,151 50,073 2,962 — 58,750 Accrued liabilities — 10,501 117,001 10,769 — 138,271 Accrued royalties — — 24,631 — — 24,631 Current portion of asset retirement obligations — — 38,028 — — 38,028 Liabilities from price risk management activities — 4,286 — — — 4,286 Accrued interest payable — 22,105 152 — — 22,257 Current portion of operating lease liabilities — 378 773 462 — 1,613 Other current liabilities 255 — 20,663 — — 20,918 Total current liabilities 819 42,421 251,321 14,193 — 308,754 Long-term liabilities: Long-term debt, net of discount and deferred financing costs — 1,027,102 6,060 — — 1,033,162 Asset retirement obligations — — 387,868 — — 387,868 Liabilities from price risk management activities — 1,898 — — — 1,898 Operating lease liabilities — 16,048 2,268 822 — 19,138 Other long-term liabilities 22,247 — 70,223 — — 92,470 Total liabilities 23,066 1,087,469 717,740 15,015 — 1,843,290 Commitments and Contingencies (Note 11) Stockholders' equity 1,394,897 1,417,909 2,032,166 135,580 (3,585,655 ) 1,394,897 $ 1,417,963 $ 2,505,378 $ 2,749,906 $ 150,595 $ (3,585,655 ) $ 3,238,187 TALOS ENERGY INC. CONDENSED CONSOLIDATING BALANCE SHEET AS OF December 31, 2019 (In thousands) Parent Subsidiary Issuers Guarantors Non- Guarantors Elimination Consolidated ASSETS Current assets: Cash and cash equivalents $ — $ 78,780 $ 593 $ 7,649 $ — $ 87,022 Accounts receivable Trade, net — — 107,842 — — 107,842 Joint interest, net — — 11,567 4,985 — 16,552 Other — 474 5,555 317 — 6,346 Assets from price risk management activities — 8,393 — — — 8,393 Prepaid assets — 33,323 32,529 25 — 65,877 Other current assets — — 1,952 — — 1,952 Total current assets — 120,970 160,038 12,976 — 293,984 Property and equipment: Proved properties — — 4,066,260 — — 4,066,260 Unproved properties, not subject to amortization — — 87,618 106,914 — 194,532 Other property and equipment — 23,142 6,484 217 — 29,843 Total property and equipment — 23,142 4,160,362 107,131 — 4,290,635 Accumulated depreciation, depletion and amortization — (11,001 ) (2,053,971 ) (51 ) — (2,065,023 ) Total property and equipment, net — 12,141 2,106,391 107,080 — 2,225,612 Other long-term assets: Other well equipment inventory — — 7,732 — — 7,732 Operating lease assets — 3,178 3,224 1,377 — 7,779 Investments in subsidiaries 1,045,886 1,690,362 — — (2,736,248 ) — Other assets 33,371 364 2,136 18,504 — 54,375 1,079,257 1,827,015 2,279,521 139,937 (2,736,248 ) 2,589,482 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable 428 5,145 58,827 6,957 — 71,357 Accrued liabilities — 4,740 145,051 5,025 — 154,816 Accrued royalties — — 31,729 — — 31,729 Current portion of asset retirement obligations — — 61,051 — — 61,051 Liabilities from price risk management activities — 19,476 — — — 19,476 Accrued interest payable — 10,211 38 — — 10,249 Current portion of operating lease liabilities — 196 821 577 — 1,594 Other current liabilities 255 — 19,925 — — 20,180 Total current liabilities 683 39,768 317,442 12,559 — 370,452 Long-term liabilities: Long-term debt, net of discount and deferred financing costs — 726,921 6,060 — — 732,981 Asset retirement obligations — — 308,427 — — 308,427 Liabilities from price risk management activities — 511 — — — 511 Operating lease liabilities — 13,929 2,416 894 — 17,239 Other long-term liabilities 297 — 81,298 — — 81,595 Total liabilities 980 781,129 715,643 13,453 — 1,511,205 Commitments and Contingencies (Note 11) Stockholders' equity 1,078,277 1,045,886 1,563,878 126,484 (2,736,248 ) 1,078,277 $ 1,079,257 $ 1,827,015 $ 2,279,521 $ 139,937 $ (2,736,248 ) $ 2,589,482 TALOS ENERGY INC. CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS FOR THE THREE MONTHS ENDED March 31, 2020 (In thousands) (Unaudited) Parent Subsidiary Issuers Guarantors Non- Guarantors Elimination Consolidated Revenues: Oil revenue $ — $ — $ 166,617 $ 7 $ — $ 166,624 Natural gas revenue — — 11,898 — — 11,898 NGL revenue — — 4,301 — — 4,301 Other — — 4,941 — — 4,941 Total revenue — — 187,757 7 — 187,764 Operating expenses: Lease operating expense — — 58,241 — — 58,241 Production taxes — — 249 — — 249 Depreciation, depletion and amortization — 727 92,803 13 — 93,543 Write-down of oil and natural gas properties — — — 57 — 57 Accretion expense — — 12,417 — — 12,417 General and administrative expense 222 16,741 9,828 678 — 27,469 Total operating expenses 222 17,468 173,538 748 — 191,976 Operating income (loss) (222 ) (17,468 ) 14,219 (741 ) — (4,212 ) Interest expense 7 (18,622 ) (7,233 ) (2 ) — (25,850 ) Price risk management activities expenses — 243,217 — — — 243,217 Other income (loss) — 166 184 (496 ) — (146 ) Income tax (expense) (55,259 ) — (1 ) — — (55,260 ) Equity earnings from subsidiaries 213,223 5,930 — — (219,153 ) — Net income (loss) $ 157,749 $ 213,223 $ 7,169 $ (1,239 ) $ (219,153 ) $ 157,749 TALOS ENERGY INC. CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS FOR THE THREE MONTHS ENDED March 31, 2019 (In thousands) (Unaudited) Parent Subsidiary Issuers Guarantors Non- Guarantors Elimination Consolidated Revenues: Oil revenue $ — $ — $ 155,679 $ — $ — $ 155,679 Natural gas revenue — — 14,447 — — 14,447 NGL revenue — — 5,066 — — 5,066 Other — — 3,521 — — 3,521 Total revenue — — 178,713 — — 178,713 Operating expenses: Lease operating expense — — 67,959 — — 67,959 Production taxes — — 582 — — 582 Depreciation, depletion and amortization — 72 64,510 5 — 64,587 Accretion expense — — 9,607 — — 9,607 General and administrative expense 337 8,606 8,775 (109 ) — 17,609 Total operating expenses 337 8,678 151,433 (104 ) — 160,344 Operating income (loss) (337 ) (8,678 ) 27,280 104 — 18,369 Interest expense — (16,572 ) (8,518 ) (128 ) — (25,218 ) Price risk management activities income — (109,579 ) — — — (109,579 ) Other income (loss) — 81 471 (119 ) — 433 Income tax expense 6,837 — (2 ) (476 ) — 6,359 Equity earnings from subsidiaries (116,136 ) 18,612 — — 97,524 — Net income (loss) $ (109,636 ) $ (116,136 ) $ 19,231 $ (619 ) $ 97,524 $ (109,636 ) TALOS ENERGY INC. CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS FOR THE THREE MONTHS ENDED March 31, 2020 (In thousands) (Unaudited) Parent Subsidiary Issuers Guarantors Non- Guarantors Elimination Consolidated Cash flows from operating activities: Net cash provided by (used in) operating activities $ 3 $ (6,781 ) $ 117,271 $ (261 ) $ — $ 110,232 Cash flows from investing activities: Exploration, development, and other capital expenditures — (1,604 ) (79,194 ) (2,790 ) — (83,588 ) Cash paid for acquisitions, net of cash acquired — — (293,095 ) — — (293,095 ) Investments in subsidiaries — (570,118 ) — — 570,118 — Distributions from subsidiaries — 289,461 — — (289,461 ) — Net cash provided by (used in) investing activities — (282,261 ) (372,289 ) (2,790 ) 280,657 (376,683 ) Cash flows from financing activities: Proceeds from Bank Credit Facility — 300,000 — — — 300,000 Deferred financing costs — (1,285 ) — — — (1,285 ) Other deferred payments — — (7,575 ) — — (7,575 ) Payment of capital lease — — (4,049 ) — — (4,049 ) Employee stock transactions — — (710 ) — — (710 ) Capital contributions — — 560,618 9,500 (570,118 ) — Distributions to Subsidiary Issuer (3 ) — (288,628 ) (830 ) 289,461 — Net cash provided by (used in) financing activities (3 ) 298,715 259,656 8,670 (280,657 ) 286,381 Net increase in cash, cash equivalents and restricted cash — 9,673 4,638 5,619 — 19,930 Cash, cash equivalents and restricted cash Balance, beginning of period — 78,780 593 7,649 — 87,022 Balance, end of period $ — $ 88,453 $ 5,231 $ 13,268 $ — $ 106,952 TALOS ENERGY INC. CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS FOR THE THREE MONTHS ENDED March 31, 2019 (In thousands) (Unaudited) Parent Subsidiary Issuers Guarantors Non- Guarantors Elimination Consolidated Cash flows from operating activities: Net cash provided by (used in) operating activities $ (207 ) $ (9,279 ) $ 72,999 $ (22,391 ) $ — $ 41,122 Cash flows from investing activities: Exploration, development, and other capital expenditures — (1,036 ) (94,144 ) (7,216 ) — (102,396 ) Cash paid for acquisitions, net of cash acquired — — (32,916 ) — — (32,916 ) Investments in subsidiaries — (441,484 ) — — 441,484 — Distributions from subsidiaries — 451,174 — — (451,174 ) — Net cash provided by (used in) investing activities — 8,654 (127,060 ) (7,216 ) (9,690 ) (135,312 ) Cash flows from financing activities: Redemption of Senior Notes and other long-term debt — — (109 ) — — (109 ) Proceeds from Bank Credit Facility — 35,000 — — — 35,000 Repayment of Bank Credit Facility — (25,000 ) — — — (25,000 ) Other deferred payments — — (6,575 ) — — (6,575 ) Payment of capital lease — — (3,311 ) — — (3,311 ) Capital contributions 207 — 421,277 20,000 (441,484 ) — Distributions to Subsidiary Issuer — — (450,912 ) (262 ) 451,174 — Net cash provided by (used in) financing activities 207 10,000 (39,630 ) 19,738 9,690 5 Net increase (decrease) in cash, cash equivalents and restricted cash — 9,375 (93,691 ) (9,869 ) — (94,185 ) Cash, cash equivalents and restricted cash Balance, beginning of period — 13,541 102,049 25,572 — 141,162 Balance, end of period $ — $ 22,916 $ 8,358 $ 15,703 $ — $ 46,977 |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2020 | |
Subsequent Events [Abstract] | |
Subsequent Events | Note 13 —Subsequent Events Economic Environment Due to a combination of the COVID-19 pandemic and related pressures on the global supply-demand balance for crude oil and related products, commodity prices have significantly declined in recent months, and oil and gas operators have reduced development budgets and activity. The Company has evaluated the effect of these factors on the business and reduced the capital expenditure budget for the remainder of 2020, accelerated planned downtime maintenance projects, experienced production shut-ins from non-operated oil and gas properties and shut-in limited operated oil and gas properties. The Company continues to monitor the economic environment and evaluate the impact on the business. |
Formation and Basis of Presen_2
Formation and Basis of Presentation (Policies) | 3 Months Ended |
Mar. 31, 2020 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Formation and Nature of Business | Formation and Nature of Business Talos Energy Inc. (“Talos” or the “Company”) is a technically driven independent exploration and production company focused on safely and efficiently maximizing value through it’s operations, currently in the United States (“U.S.”) Gulf of Mexico and offshore Mexico. The Company leverages decades of geology, geophysics and offshore operations expertise towards the acquisition, exploration, exploitation and development of assets in key geological trends that are present in many offshore basins around the world. Talos was formed in connection with the previously disclosed business combination between Talos Energy LLC and Stone Energy Corporation (“Stone”) that occurred on May 10, 2018, pursuant to which Talos Energy LLC and Stone became indirect wholly owned subsidiaries of Talos (the “Stone Combination”). Talos Energy LLC was formed in 2011 and commenced commercial operations on February 6, 2013. Prior to February 6, 2013, Talos Energy LLC had incurred certain general and administrative expenses associated with the start-up of its operations. On February 3, 2012, Talos Energy LLC completed a transaction with funds and other alternative investment vehicles managed by Apollo Management VII, L.P. and Apollo Commodities Management, L.P., with respect to Series I (“Apollo Funds”), and entities controlled by or affiliated with Riverstone Energy Partners V, L.P. (“Riverstone Funds” and, together with the Apollo Funds, the “Sponsors”) and members of management pursuant to which the Company received a private equity capital commitment. |
Basis of Presentation and Consolidation | Basis of Presentation and Consolidation The condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the SEC regarding interim financial reporting. Accordingly, certain information and disclosures normally included in complete financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) have been condensed or omitted pursuant to such rules and regulations. In the opinion of management, these financial statements include all adjustments, which unless otherwise disclosed, are of a normal recurring nature, necessary for a fair presentation of the financial position, results of operations, cash flows and changes in equity for the periods presented. The results for interim periods are not necessarily indicative of results for the entire year. The Company has evaluated subsequent events through the date the condensed consolidated financial statements were issued. The unaudited financial statements and related notes included in this Quarterly Report on Form 10-Q should be read in conjunction with the Company’s audited Consolidated Financial Statements and related notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements, the reported amounts of revenues and expenses during the reporting periods and the reported amounts of proved oil and natural gas reserves. Actual results could differ from those estimates. As discussed in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019, operating expenses previously presented as “Direct lease operating expense,” “Insurance” and “Workover and maintenance expense” have been combined and presented as “Lease operating expense” on the Company’s Condensed Consolidated Statements of Operations. Such reclassification had no effect on the Company’s results of operations, financial position or cash flows. The Company has one reportable segment, which is the exploration and production of oil and natural gas. Substantially all the Company’s long-lived assets, proved reserves and production sales are related to the Company’s operations in the United States. |
Recently Adopted Or Issued Accounting Standards | Recently Adopted Accounting Standards Credit Risk Losses — In June 2016, the Financial Accounting Standards Board issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, which changes accounting requirements for the recognition of credit losses from an incurred or probable impairment methodology to a current expected credit losses (“CECL”) methodology. The CECL model is applicable to the measurement of credit losses on financial assets measured at amortized cost, including but not limited to trade receivables. The guidance was adopted on January 1, 2020 using a modified retrospective approach. The adoption of this guidance did not have a material effect on the Company’s condensed consolidated financial statements or related disclosures. Accounts receivable resulting from the sale of crude oil, NGL and natural gas production and joint interest billings to our partners for their share of expenses on joint venture projects for which we are the operator are the primary financial assets within the scope of the standard. Although these receivables are from a diverse group of companies, including major energy companies, pipeline companies and joint interest owners they are concentrated in the oil and gas industry. This concertation has the potential to impact our overall exposure to credit risk in that these companies may be similarly affected by changes in economic and financial conditions, commodity prices, or other conditions. A loss-rate methodology is used to estimate the allowance for expected credit losses to be accrued on material receivables to reflect the net amount to be collected. At each reporting period the loss-rate is determined utilizing historical data, current market conditions and reasonable and supported forecast of future economic conditions. Our allowance for uncollectable receivables was $9.9 million at March 31, 2020 and $9.9 million at December 31, 2019. |
Acquisitions (Tables)
Acquisitions (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
ILX and Castex | |
Business Acquisition [Line Items] | |
Summary of Purchase Price, Subject to Customary Post-Closing Adjustments | The following table summarizes the purchase price, subject to customary post-closing adjustments (in thousands except per share data): Talos Conversion Stock 11,000 Talos common stock price per share (1) $ 14.20 Conversion Stock value $ 156,200 Cash consideration $ 385,000 Customary closing adjustments (91,905 ) Net cash consideration paid at closing $ 293,095 Total purchase price $ 449,295 (1) Represents the closing price of the Company’s common stock on February 28, 2020, the date of the closing of the ILX and Castex Acquisition. The purchase price was based on the value of the Conversion Stock as the value approximates the value of the Preferred Shares as a result of the automatic conversion and dividend rights described in that certain Certificate of Designation, Preferences, Rights and Limitations. |
Summary of Allocation of Purchase Price to Assets Acquired and Liabilities Assumed | The following table presents the preliminary allocation of the purchase price to the assets acquired and liabilities assumed, based on their fair values on February 28, 2020 (in thousands): February 28, 2020 Current assets (1) $ 10,969 Property and equipment 489,796 Other long-term assets 148 Current liabilities (7,129 ) Long-term debt - Other long-term liabilities (44,489 ) Allocated purchase price $ 449,295 (1) The Company incurred approximately $10.9 million of transaction related costs, of which $7.5 million was recognized in the first quarter of 2020 and $3.4 million was recognized in the fourth quarter of 2019 and reflected in general and administrative expense on the condensed consolidated statements of operations. The follow ing table presents revenue and net income attributable to the assets acquired in the ILX and Castex Acquisition for th e three months ended March 31, 2020 : Three Months Ended March 31, 2020 Revenue $ 13,892 Net income $ 3,209 |
Supplemental Proforma Information | The following supplemental pro forma financial information (in thousands, except per common share amounts), presents the condensed consolidated results of operations for the three months ended March 31, 2020 and 2019 as if the ILX and Castex Acquisition had occurred on January 1, 2019. The unaudited pro forma information was derived from historical statements of operations of the Company and the Sellers adjusted to (i) include depletion expense applied to the adjusted basis of the oil and natural gas properties acquired, (ii) include interest expense to reflect borrowings under the Bank Credit Facility, (iii) eliminate the write-down of oil and natural gas properties on the assets acquired to reflect the pro-forma ceiling test calculation and (iv) include weighted average basic and diluted shares of common stock outstanding, which was calculated assuming the 11.0 million shares of Conversion Stock were issued to the Sellers. This information does not purport to be indicative of results of operations that would have occurred had the ILX and Castex Acquisition occurred on January 1, 2019, nor is such information indicative of any expected future results of operations. Three Months Ended March 31, 2020 2019 Revenue $ 235,199 $ 260,971 Net income (loss) $ 167,566 $ (79,448 ) Basic net income (loss) per common share $ 2.56 $ (1.22 ) Diluted net income (loss) per common share $ 2.55 $ (1.22 ) |
Gunflint Acquisition | |
Business Acquisition [Line Items] | |
Summary of Allocation of Purchase Price to Assets Acquired and Liabilities Assumed | The following table presents the allocation of the purchase price to the assets acquired and liabilities assumed, based on their relative fair values, on January 11, 2019 (in thousands): Property and equipment $ 28,912 Asset retirement obligations (996 ) Allocated purchase price $ 27,916 |
Property, Plant and Equipment (
Property, Plant and Equipment (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Oil And Gas Property [Abstract] | |
Schedule of Asset Retirement Obligations | Asset Retirement Obligations The discounted asset retirement obligations included in the condensed consolidated balance sheets in current and non-current liabilities, and the changes in that liability during the three months ended March 31, 2020 were as follows (in thousands): Asset retirement obligations at January 1 $ 369,478 Fair value of asset retirement obligations acquired (1) 44,489 Obligations settled (6,302 ) Accretion expense 12,417 Changes in estimate 5,814 Asset retirement obligations at March 31 $ 425,896 Less: Current portion (38,028 ) Long-term portion $ 387,868 (1) Three months ended March 31, 2020 includes $44.5 million of asset retirement obligations assumed in the ILX and Castex Acquisition. |
Leases (Tables)
Leases (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Leases [Abstract] | |
Components of Lease Costs | The components of lease costs were as follows (in thousands): Three Months Ended March 31, 2020 2019 Finance lease cost - interest on lease liabilities (1) $ 4,265 $ 4,994 Operating lease cost, excluding short-term leases (2) 866 763 Short-term lease cost (3) 3,535 36,609 Variable lease cost (4) 3 2 Total lease cost $ 8,669 $ 42,368 (1) The Helix Producer I (the “HP-I”) is utilized in the Company’s oil and natural gas development activities and the right-of-use asset was capitalized and included in proved property and depleted as part of the full cost pool. Once items are included in the full cost pool, they are indistinguishable from other proved properties. The capitalized costs within the full cost pool are amortized over the life of the total proved reserved using the unit-of-production method, computed quarterly. (2) Operating lease cost reflect a single lease cost, calculated so that the cost of the lease is allocated over the lease term on a straight-line basis. (3) Short-term lease costs are reported at gross amounts and primarily represent costs incurred for drilling rigs, most of which are short-term contracts not recognized as a right-of-use asset and lease liability on the balance sheet. (4) Variable lease costs primarily represent differences between minimum payment obligations and actual operating charges incurred by the Company related to its long-term leases. |
Schedule of Right-of-Use Asset and Liability, Adjusted for Initial Direct Costs and Incentives | The present value of the fixed lease payments recorded as the Company’s right-of-use asset and liability, adjusted for initial direct costs and incentives, are as follows (in thousands): March 31, 2020 December 31, 2019 Operating leases: Operating lease assets $ 7,590 $ 7,779 Current portion of operating lease liabilities $ 1,613 $ 1,594 Operating lease liabilities 19,138 17,239 Total operating lease liabilities $ 20,751 $ 18,833 Finance leases: Proved property (1) $ 124,299 $ 124,299 Other current liabilities $ 18,519 $ 17,509 Other long-term liabilities 56,967 62,026 Total finance lease liabilities $ 75,486 $ 79,535 (1) The HP-I is utilized in the Company’s oil and natural gas development activities and the right-of-use asset was capitalized and included in proved property and depleted as part of the full cost pool. Once items are included in the full cost pool, they are indistinguishable from other proved properties. The capitalized costs within the full cost pool are amortized over the life of the total proved reserves using the unit-of-production method, computed quarterly. |
Schedule of Lease Maturity | The table below presents the lease maturity by year as of March 31, 2020 (in thousands). Such commitments are reflected at undiscounted values and are reconciled to the discounted present value recognized on the condensed consolidated balance sheet. Operating Leases Finance Leases 2020 (excluding the three months ended March 31, 2020) $ 2,289 $ 24,943 2021 4,079 33,257 2022 4,302 33,257 2023 4,239 13,857 2024 3,314 — Thereafter 15,790 — Total lease payments $ 34,013 $ 105,314 Imputed interest (13,262 ) (29,828 ) Total $ 20,751 $ 75,486 |
Schedule of Weighted Average Remaining Lease Term and Discount Rate | The table below presents the weighted average remaining lease term and discount rate related to leases for the three months ended March 31, 2020 and 2019: Three Months Ended March 31, 2020 2019 Weighted average remaining lease term: Operating leases 8.3 years 6.0 years Finance leases 3.2 years 4.0 years Weighted average discount rate: Operating leases 10.3 % 11.6 % Finance leases 21.9 % 21.9 % |
Supplemental Cash Flow Information Related to Leases | The table below presents the supplemental cash flow information related to leases for the three months ended March 31, 2020 and 2019 (in thousands): Three Months Ended March 31, 2020 2019 Operating cash outflow from finance leases $ 4,265 $ 4,994 Financing cash outflow from finance leases $ 4,049 $ 3,311 Operating cash outflow from operating leases $ 455 $ 453 Right-of-use assets obtained in exchange for new finance lease liabilities $ — $ — Right-of-use assets obtained in exchange for new operating lease liabilities $ — $ 613 |
Financial Instruments (Tables)
Financial Instruments (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Financial Instruments [Abstract] | |
Schedule of Carrying Amounts and Estimated Fair Values of Financial Instruments | The following table presents the carrying amounts and estimated fair values of the Company’s financial instruments (in thousands): March 31, 2020 December 31, 2019 Carrying Amount Fair Value Carrying Amount Fair Value 11.00% Second-Priority Senior Secured Notes – due April 2022 (1) $ 384,571 $ 240,384 $ 383,871 $ 401,128 7.50% Senior Notes – due May 2022 $ 6,060 $ 3,030 $ 6,060 $ 5,030 Bank Credit Facility – matures May 2022 (1) $ 642,531 $ 650,000 $ 343,050 $ 350,000 Oil and Natural Gas Derivatives $ 195,163 $ 195,163 $ (11,594 ) $ (11,594 ) (1) |
Schedule of Impact that Derivatives not Qualifying as Hedging Instruments in Condensed Consolidated Statements of Operations | The following table presents the impact that derivatives, not qualifying as hedging instruments, had on its condensed consolidated statements of operations (in thousands): Three Months Ended March 31, 2020 2019 Net cash received (paid) on settled derivative instruments $ 36,460 $ (3,019 ) Unrealized gain (loss) 206,757 (106,560 ) Price risk management activities income (expense) $ 243,217 $ (109,579 ) |
Schedule of Contracted Volumes and Weighted Average Prices and will Receive Under the Terms of Derivative Contracts | The following table reflects the contracted volumes and weighted average prices the Company will receive under the terms of its derivative contracts as of March 31, 2020: Production Period Instrument Type Average Daily Volumes Weighted Average Swap Price Weighted Average Put Price Weighted Average Call Price Crude Oil – WTI: (Bbls) (per Bbl) (per Bbl) (per Bbl) April 2020 – December 2020 Swap 30,320 $ 47.94 $ — $ — January 2021 – December 2021 Swap 4,230 $ 45.90 $ — $ — April 2020 – December 2020 Collar 5,000 $ — $ 50.00 $ 57.09 January 2021 – December 2021 Collar 1,000 $ — $ 30.00 $ 40.00 Natural Gas – NYMEX Henry Hub: (MMBtu) (per MMBtu) (per MMBtu) (per MMBtu) April 2020 – December 2020 Swaps 26,000 $ 2.23 $ — $ — January 2021 – December 2021 Swaps 30,000 $ 2.40 $ — $ — |
Summary of Additional Information Related to Financial Instruments Measured at Fair Value on Recurring Basis | The following tables provide additional information related to financial instruments measured at fair value on a recurring basis (in thousands): March 31, 2020 Level 1 Level 2 Level 3 Total Assets: Oil and natural gas swaps and costless collars $ — $ 201,347 $ — $ 201,347 Liabilities: Oil and natural gas swaps and costless collars — (6,184 ) — (6,184 ) Total net asset $ — $ 195,163 $ — $ 195,163 December 31, 2019 Level 1 Level 2 Level 3 Total Assets: Oil and natural gas swaps and costless collars $ — $ 8,393 $ — $ 8,393 Liabilities: Oil and natural gas swaps and costless collars — (19,987 ) — (19,987 ) Total net liability $ — $ (11,594 ) $ — $ (11,594 ) |
Schedule of Fair Value of Derivative Financial Instruments | The following table presents the fair value of derivative financial instruments at March 31, 2020 and December 31, 2019 (in thousands): March 31, 2020 December 31, 2019 Assets Liabilities Assets Liabilities Oil and natural gas derivatives: Current $ 192,553 $ 4,286 $ 8,393 $ 19,476 Non-current 8,794 1,898 — 511 Total $ 201,347 $ 6,184 $ 8,393 $ 19,987 |
Debt (Tables)
Debt (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Debt Disclosure [Abstract] | |
Summary of Detail Comprising Debt and Related Book Values | A summary of the detail comprising the Company’s debt and the related book values for the respective periods presented is as follows (in thousands): March 31, 2020 December 31, 2019 11.00% Second-Priority Senior Secured Notes – due April 2022 $ 390,868 $ 390,868 7.50% Senior Notes – due May 2022 6,060 6,060 Bank Credit Facility – matures May 2022 650,000 350,000 Total debt, before discount and deferred financing cost 1,046,928 746,928 Discount and deferred financing cost (13,766 ) (13,947 ) Total debt, net of discount and deferred financing costs $ 1,033,162 $ 732,981 |
Employee Benefits Plans and S_2
Employee Benefits Plans and Share-Based Compensation (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Summary of Restricted Stock Units Activity | The following table summarizes RSU activity for the three months ended March 31, 2020 : Restricted Stock Units Weighted Average Grant Date Fair Value Unvested RSUs at December 31, 2019 733,777 $ 25.20 Granted 1,278,095 $ 10.04 Vested (225,507 ) $ 24.36 Forfeited (36,677 ) $ 24.72 Unvested RSUs at March 31, 2020 1,749,688 $ 14.24 |
Summary of Performance Share Units Activity | The following table summarizes PSU activity for the three months ended March 31, 2020: Restricted Stock Units Weighted Average Grant Date Fair Value Unvested PSUs at December 31, 2019 417,831 $ 39.31 Granted 441,642 $ 13.05 Vested — $ — Forfeited (18,533 ) $ 35.74 Unvested PSUs at March 31, 2020 840,940 $ 25.60 |
Summary of Assumptions Used to Calculate the Grant Date Fair Value of PSUs Granted | The following table summarizes the assumptions used to calculate the grant date fair value of the PSUs granted for the three months ended March 31, 2020 2020 Grant Date March 5, 2020 Number of simulations 100,000 Expected term (in years) 2.8 Expected volatility 48.8 % Risk-free interest rate 0.6 % Dividend yield — % |
Schedule of Recognized Share Based Compensation Expense, Net | The Company recognized the following share-based compensation e xpense, net for the three months ended March 31, 2020 and 2019 (in thousands): Three Months Ended March 31, 2020 2019 Share-based compensation expense $ 3,212 $ 2,275 Less: amounts capitalized to oil and gas properties (1,585 ) (1,016 ) Total share-based compensation expense, net $ 1,627 $ 1,259 |
Income (Loss) Per Share (Tables
Income (Loss) Per Share (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Earnings Per Share [Abstract] | |
Summary of Computation of Basic and Diluted Income (Loss) Per Share | The following table presents the computation of the Company’s basic and diluted income (loss) per share were as follows (in thousands, except for the per share amounts): Three Months Ended March 31, 2020 2019 Net income (loss) $ 157,749 $ (109,636 ) Weighted average common shares outstanding — basic 58,240 54,156 Dilutive effect of securities 332 — Weighted average common shares outstanding — diluted 58,572 54,156 Net income (loss) per common share: Basic $ 2.71 $ (2.02 ) Diluted $ 2.69 $ (2.02 ) Anti-dilutive potentially issuable securities excluded from diluted common shares 4,358 4,762 |
Condensed Consolidating Finan_2
Condensed Consolidating Financial Information (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Condensed Financial Information Of Parent Company Only Disclosure [Abstract] | |
Summary of Condensed Consolidating Financial Information | The following condensed consolidating financial information presents the financial information of the Company on an unconsolidated stand-alone basis and its combined guarantor and combined non-guarantor subsidiaries as of and for the period indicated. Such financial information may not necessarily be indicative of the Company’s results of operations, cash flows or financial position had these subsidiaries operated as independent entities. TALOS ENERGY INC. CONDENSED CONSOLIDATING BALANCE SHEET AS OF March 31, 2020 (In thousands) (Unaudited) Parent Subsidiary Issuers Guarantors Non- Guarantors Elimination Consolidated ASSETS Current assets: Cash and cash equivalents $ — $ 88,453 $ 5,231 $ 13,268 $ — $ 106,952 Accounts receivable Trade, net — — 81,027 — — 81,027 Joint interest, net — — 26,906 5,988 — 32,894 Other — 28,153 8,097 306 — 36,556 Assets from price risk management activities — 192,553 — — — 192,553 Prepaid assets — 2,809 47,442 22 — 50,273 Other current assets 53 — 1,993 — — 2,046 Total current assets 53 311,968 170,696 19,584 — 502,301 Property and equipment: Proved properties — — 4,538,100 — — 4,538,100 Unproved properties, not subject to amortization — — 166,450 110,600 — 277,050 Other property and equipment — 24,920 6,829 217 — 31,966 Total property and equipment — 24,920 4,711,379 110,817 — 4,847,116 Accumulated depreciation, depletion and amortization — (11,728 ) (2,146,773 ) (65 ) — (2,158,566 ) Total property and equipment, net — 13,192 2,564,606 110,752 — 2,688,550 Other long-term assets: Assets from price risk management activities — 8,794 — — — 8,794 Other well equipment inventory — — 9,178 — — 9,178 Operating lease assets — 3,314 3,030 1,246 — 7,590 Investments in subsidiaries 1,417,909 2,167,746 — — (3,585,655 ) — Other assets 1 364 2,396 19,013 — 21,774 1,417,963 2,505,378 2,749,906 150,595 (3,585,655 ) 3,238,187 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable 564 5,151 50,073 2,962 — 58,750 Accrued liabilities — 10,501 117,001 10,769 — 138,271 Accrued royalties — — 24,631 — — 24,631 Current portion of asset retirement obligations — — 38,028 — — 38,028 Liabilities from price risk management activities — 4,286 — — — 4,286 Accrued interest payable — 22,105 152 — — 22,257 Current portion of operating lease liabilities — 378 773 462 — 1,613 Other current liabilities 255 — 20,663 — — 20,918 Total current liabilities 819 42,421 251,321 14,193 — 308,754 Long-term liabilities: Long-term debt, net of discount and deferred financing costs — 1,027,102 6,060 — — 1,033,162 Asset retirement obligations — — 387,868 — — 387,868 Liabilities from price risk management activities — 1,898 — — — 1,898 Operating lease liabilities — 16,048 2,268 822 — 19,138 Other long-term liabilities 22,247 — 70,223 — — 92,470 Total liabilities 23,066 1,087,469 717,740 15,015 — 1,843,290 Commitments and Contingencies (Note 11) Stockholders' equity 1,394,897 1,417,909 2,032,166 135,580 (3,585,655 ) 1,394,897 $ 1,417,963 $ 2,505,378 $ 2,749,906 $ 150,595 $ (3,585,655 ) $ 3,238,187 TALOS ENERGY INC. CONDENSED CONSOLIDATING BALANCE SHEET AS OF December 31, 2019 (In thousands) Parent Subsidiary Issuers Guarantors Non- Guarantors Elimination Consolidated ASSETS Current assets: Cash and cash equivalents $ — $ 78,780 $ 593 $ 7,649 $ — $ 87,022 Accounts receivable Trade, net — — 107,842 — — 107,842 Joint interest, net — — 11,567 4,985 — 16,552 Other — 474 5,555 317 — 6,346 Assets from price risk management activities — 8,393 — — — 8,393 Prepaid assets — 33,323 32,529 25 — 65,877 Other current assets — — 1,952 — — 1,952 Total current assets — 120,970 160,038 12,976 — 293,984 Property and equipment: Proved properties — — 4,066,260 — — 4,066,260 Unproved properties, not subject to amortization — — 87,618 106,914 — 194,532 Other property and equipment — 23,142 6,484 217 — 29,843 Total property and equipment — 23,142 4,160,362 107,131 — 4,290,635 Accumulated depreciation, depletion and amortization — (11,001 ) (2,053,971 ) (51 ) — (2,065,023 ) Total property and equipment, net — 12,141 2,106,391 107,080 — 2,225,612 Other long-term assets: Other well equipment inventory — — 7,732 — — 7,732 Operating lease assets — 3,178 3,224 1,377 — 7,779 Investments in subsidiaries 1,045,886 1,690,362 — — (2,736,248 ) — Other assets 33,371 364 2,136 18,504 — 54,375 1,079,257 1,827,015 2,279,521 139,937 (2,736,248 ) 2,589,482 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable 428 5,145 58,827 6,957 — 71,357 Accrued liabilities — 4,740 145,051 5,025 — 154,816 Accrued royalties — — 31,729 — — 31,729 Current portion of asset retirement obligations — — 61,051 — — 61,051 Liabilities from price risk management activities — 19,476 — — — 19,476 Accrued interest payable — 10,211 38 — — 10,249 Current portion of operating lease liabilities — 196 821 577 — 1,594 Other current liabilities 255 — 19,925 — — 20,180 Total current liabilities 683 39,768 317,442 12,559 — 370,452 Long-term liabilities: Long-term debt, net of discount and deferred financing costs — 726,921 6,060 — — 732,981 Asset retirement obligations — — 308,427 — — 308,427 Liabilities from price risk management activities — 511 — — — 511 Operating lease liabilities — 13,929 2,416 894 — 17,239 Other long-term liabilities 297 — 81,298 — — 81,595 Total liabilities 980 781,129 715,643 13,453 — 1,511,205 Commitments and Contingencies (Note 11) Stockholders' equity 1,078,277 1,045,886 1,563,878 126,484 (2,736,248 ) 1,078,277 $ 1,079,257 $ 1,827,015 $ 2,279,521 $ 139,937 $ (2,736,248 ) $ 2,589,482 TALOS ENERGY INC. CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS FOR THE THREE MONTHS ENDED March 31, 2020 (In thousands) (Unaudited) Parent Subsidiary Issuers Guarantors Non- Guarantors Elimination Consolidated Revenues: Oil revenue $ — $ — $ 166,617 $ 7 $ — $ 166,624 Natural gas revenue — — 11,898 — — 11,898 NGL revenue — — 4,301 — — 4,301 Other — — 4,941 — — 4,941 Total revenue — — 187,757 7 — 187,764 Operating expenses: Lease operating expense — — 58,241 — — 58,241 Production taxes — — 249 — — 249 Depreciation, depletion and amortization — 727 92,803 13 — 93,543 Write-down of oil and natural gas properties — — — 57 — 57 Accretion expense — — 12,417 — — 12,417 General and administrative expense 222 16,741 9,828 678 — 27,469 Total operating expenses 222 17,468 173,538 748 — 191,976 Operating income (loss) (222 ) (17,468 ) 14,219 (741 ) — (4,212 ) Interest expense 7 (18,622 ) (7,233 ) (2 ) — (25,850 ) Price risk management activities expenses — 243,217 — — — 243,217 Other income (loss) — 166 184 (496 ) — (146 ) Income tax (expense) (55,259 ) — (1 ) — — (55,260 ) Equity earnings from subsidiaries 213,223 5,930 — — (219,153 ) — Net income (loss) $ 157,749 $ 213,223 $ 7,169 $ (1,239 ) $ (219,153 ) $ 157,749 TALOS ENERGY INC. CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS FOR THE THREE MONTHS ENDED March 31, 2019 (In thousands) (Unaudited) Parent Subsidiary Issuers Guarantors Non- Guarantors Elimination Consolidated Revenues: Oil revenue $ — $ — $ 155,679 $ — $ — $ 155,679 Natural gas revenue — — 14,447 — — 14,447 NGL revenue — — 5,066 — — 5,066 Other — — 3,521 — — 3,521 Total revenue — — 178,713 — — 178,713 Operating expenses: Lease operating expense — — 67,959 — — 67,959 Production taxes — — 582 — — 582 Depreciation, depletion and amortization — 72 64,510 5 — 64,587 Accretion expense — — 9,607 — — 9,607 General and administrative expense 337 8,606 8,775 (109 ) — 17,609 Total operating expenses 337 8,678 151,433 (104 ) — 160,344 Operating income (loss) (337 ) (8,678 ) 27,280 104 — 18,369 Interest expense — (16,572 ) (8,518 ) (128 ) — (25,218 ) Price risk management activities income — (109,579 ) — — — (109,579 ) Other income (loss) — 81 471 (119 ) — 433 Income tax expense 6,837 — (2 ) (476 ) — 6,359 Equity earnings from subsidiaries (116,136 ) 18,612 — — 97,524 — Net income (loss) $ (109,636 ) $ (116,136 ) $ 19,231 $ (619 ) $ 97,524 $ (109,636 ) TALOS ENERGY INC. CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS FOR THE THREE MONTHS ENDED March 31, 2020 (In thousands) (Unaudited) Parent Subsidiary Issuers Guarantors Non- Guarantors Elimination Consolidated Cash flows from operating activities: Net cash provided by (used in) operating activities $ 3 $ (6,781 ) $ 117,271 $ (261 ) $ — $ 110,232 Cash flows from investing activities: Exploration, development, and other capital expenditures — (1,604 ) (79,194 ) (2,790 ) — (83,588 ) Cash paid for acquisitions, net of cash acquired — — (293,095 ) — — (293,095 ) Investments in subsidiaries — (570,118 ) — — 570,118 — Distributions from subsidiaries — 289,461 — — (289,461 ) — Net cash provided by (used in) investing activities — (282,261 ) (372,289 ) (2,790 ) 280,657 (376,683 ) Cash flows from financing activities: Proceeds from Bank Credit Facility — 300,000 — — — 300,000 Deferred financing costs — (1,285 ) — — — (1,285 ) Other deferred payments — — (7,575 ) — — (7,575 ) Payment of capital lease — — (4,049 ) — — (4,049 ) Employee stock transactions — — (710 ) — — (710 ) Capital contributions — — 560,618 9,500 (570,118 ) — Distributions to Subsidiary Issuer (3 ) — (288,628 ) (830 ) 289,461 — Net cash provided by (used in) financing activities (3 ) 298,715 259,656 8,670 (280,657 ) 286,381 Net increase in cash, cash equivalents and restricted cash — 9,673 4,638 5,619 — 19,930 Cash, cash equivalents and restricted cash Balance, beginning of period — 78,780 593 7,649 — 87,022 Balance, end of period $ — $ 88,453 $ 5,231 $ 13,268 $ — $ 106,952 TALOS ENERGY INC. CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS FOR THE THREE MONTHS ENDED March 31, 2019 (In thousands) (Unaudited) Parent Subsidiary Issuers Guarantors Non- Guarantors Elimination Consolidated Cash flows from operating activities: Net cash provided by (used in) operating activities $ (207 ) $ (9,279 ) $ 72,999 $ (22,391 ) $ — $ 41,122 Cash flows from investing activities: Exploration, development, and other capital expenditures — (1,036 ) (94,144 ) (7,216 ) — (102,396 ) Cash paid for acquisitions, net of cash acquired — — (32,916 ) — — (32,916 ) Investments in subsidiaries — (441,484 ) — — 441,484 — Distributions from subsidiaries — 451,174 — — (451,174 ) — Net cash provided by (used in) investing activities — 8,654 (127,060 ) (7,216 ) (9,690 ) (135,312 ) Cash flows from financing activities: Redemption of Senior Notes and other long-term debt — — (109 ) — — (109 ) Proceeds from Bank Credit Facility — 35,000 — — — 35,000 Repayment of Bank Credit Facility — (25,000 ) — — — (25,000 ) Other deferred payments — — (6,575 ) — — (6,575 ) Payment of capital lease — — (3,311 ) — — (3,311 ) Capital contributions 207 — 421,277 20,000 (441,484 ) — Distributions to Subsidiary Issuer — — (450,912 ) (262 ) 451,174 — Net cash provided by (used in) financing activities 207 10,000 (39,630 ) 19,738 9,690 5 Net increase (decrease) in cash, cash equivalents and restricted cash — 9,375 (93,691 ) (9,869 ) — (94,185 ) Cash, cash equivalents and restricted cash Balance, beginning of period — 13,541 102,049 25,572 — 141,162 Balance, end of period $ — $ 22,916 $ 8,358 $ 15,703 $ — $ 46,977 |
Formation and Basis of Presen_3
Formation and Basis of Presentation - Additional Information (Details) $ in Millions | 3 Months Ended | |
Mar. 31, 2020USD ($)Segment | Mar. 31, 2019USD ($) | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | ||
Number of reportable segment | Segment | 1 | |
Allowance for uncollectable receivables | $ | $ 9.9 | $ 9.9 |
Acquisitions - Asset Acquisitio
Acquisitions - Asset Acquisitions - Additional Information (Details) - Gunflint Acquisition $ in Millions | Jan. 11, 2019USD ($) |
Business Acquisition [Line Items] | |
Percentage of voting interest acquired | 9.60% |
Purchase price | $ 29.6 |
Customary purchase price adjustments | $ 27.9 |
Acquisitions - Asset Acquisit_2
Acquisitions - Asset Acquisitions - Summary of Allocation of Purchase Price to Assets Acquired and Liabilities Assumed (Details) - Gunflint Acquisition $ in Thousands | Jan. 11, 2019USD ($) |
Business Acquisition [Line Items] | |
Property and equipment | $ 28,912 |
Asset retirement obligations | (996) |
Allocated purchase price | $ 27,916 |
Acquisitions - Business Combina
Acquisitions - Business Combination - Additional Information (Details) - ILX and Castex - USD ($) $ in Thousands | Mar. 30, 2020 | Feb. 28, 2020 | Dec. 10, 2019 | Mar. 31, 2020 | Dec. 31, 2019 |
Business Acquisition [Line Items] | |||||
Aggregate consideration of cash | $ 385,000 | ||||
Acquisition, transaction related cost | 10,900 | ||||
General and Administrative Expense | |||||
Business Acquisition [Line Items] | |||||
Acquisition, transaction related cost | $ 7,500 | $ 3,400 | |||
Contingent Convertible Preferred Stock | |||||
Business Acquisition [Line Items] | |||||
Conversion stock issued to sellers | 11,000,000 | ||||
Talos Energy L L C Stakeholders | |||||
Business Acquisition [Line Items] | |||||
Business acquisition, effective date | Jul. 1, 2019 | ||||
Aggregate consideration of cash | $ 385,000 | ||||
Talos Energy L L C Stakeholders | Series A Convertible Preferred Stock | |||||
Business Acquisition [Line Items] | |||||
Aggregate shares issued | 110,000 | 110,000 | |||
Conversion of stock, new issuance | 11,000,000 |
Acquisitions - Summary of Purch
Acquisitions - Summary of Purchase Price, Subject to Customary Post-Closing Adjustments (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Business Acquisition [Line Items] | ||
Net cash consideration paid at closing | $ 293,095 | $ 32,916 |
ILX and Castex | ||
Business Acquisition [Line Items] | ||
Talos Conversion Stock | 11,000,000 | |
Talos common stock price per share | $ 14.20 | |
Conversion Stock value | $ 156,200 | |
Cash consideration | 385,000 | |
Customary closing adjustments | (91,905) | |
Net cash consideration paid at closing | 293,095 | |
Total purchase price | $ 449,295 |
Acquisitions - Business Combi_2
Acquisitions - Business Combination - Summary of Allocation of Purchase Price to Assets Acquired and Liabilities Assumed (Details) - ILX and Castex $ in Thousands | Feb. 28, 2020USD ($) |
Business Acquisition [Line Items] | |
Current assets | $ 10,969 |
Property and equipment | 489,796 |
Other long-term assets | 148 |
Current liabilities | (7,129) |
Other long-term liabilities | (44,489) |
Allocated purchase price | $ 449,295 |
Acquisitions - Business Combi_3
Acquisitions - Business Combination - Summary of Allocation of Purchase Price to Assets Acquired and Liabilities Assumed (Parenthetical) (Details) $ in Millions | Feb. 28, 2020USD ($) |
ILX and Castex | Trade and Other Receivables | |
Business Acquisition [Line Items] | |
Primary fair values of receivables acquired | $ 8.2 |
Acquisitions - Business Combi_4
Acquisitions - Business Combination - Summary of Revenue and Net Income Attributable to Assets Acquired (Details) - ILX and Castex $ in Thousands | 3 Months Ended |
Mar. 31, 2020USD ($) | |
Business Acquisition [Line Items] | |
Revenue | $ 13,892 |
Net income | $ 3,209 |
Acquisitions - Business Combi_5
Acquisitions - Business Combination - Summary of Supplemental Proforma Information (Details) - ILX and Castex - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Business Acquisition [Line Items] | ||
Revenue | $ 235,199 | $ 260,971 |
Net income (loss) | $ 167,566 | $ (79,448) |
Basic net income (loss) per common share | $ 2.56 | $ (1.22) |
Diluted net income (loss) per common share | $ 2.55 | $ (1.22) |
Property, Plant and Equipment -
Property, Plant and Equipment - Additional Information (Details) | 3 Months Ended | |
Mar. 31, 2020USD ($)$ / bbl$ / Mcf | Mar. 31, 2019USD ($) | |
Property, Plant and Equipment [Line Items] | ||
Write-down of oil and natural gas properties | $ 190,000 | |
Capitalized overhead costs | 7,000,000 | $ 6,600,000 |
US | ||
Property, Plant and Equipment [Line Items] | ||
Write-down of oil and natural gas properties | $ 0 | $ 0 |
Unweighted average first day of month commodity price for crude oil for prior twelve months | $ / bbl | 60.10 | |
Unweighted average first day of month commodity price for natural gas for prior twelve months | $ / Mcf | 2.36 | |
Unweighted average first day of month commodity price for natural gas liquids for prior twelve months | $ / bbl | 15.62 |
Property, Plant and Equipment_2
Property, Plant and Equipment - Schedule of Asset Retirement Obligations (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Oil And Gas Property [Abstract] | |||
Asset retirement obligations | $ 369,478 | ||
Fair value of asset retirement obligations acquired | 44,489 | ||
Obligations settled | (6,302) | ||
Accretion expense | 12,417 | $ 9,607 | |
Changes in estimate | 5,814 | ||
Asset retirement obligations | 425,896 | ||
Less: Current portion | (38,028) | $ (61,051) | |
Long-term portion | $ 387,868 | $ 308,427 |
Property, Plant and Equipment_3
Property, Plant and Equipment - Schedule of Asset Retirement Obligations (Parenthetical) (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2020USD ($) | |
ILX and Castex | |
Property, Plant and Equipment [Line Items] | |
Fair value of asset retirement obligations assumed | $ 44.5 |
Leases - Components of Lease Co
Leases - Components of Lease Costs (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | ||
Leases [Abstract] | |||
Finance lease cost - interest on lease liabilities | [1] | $ 4,265 | $ 4,994 |
Operating lease cost, excluding short-term leases | [2] | 866 | 763 |
Short-term lease cost | [3] | 3,535 | 36,609 |
Variable lease cost | [4] | 3 | 2 |
Total lease cost | $ 8,669 | $ 42,368 | |
[1] | The Helix Producer I (the “HP-I”) is utilized in the Company’s oil and natural gas development activities and the right-of-use asset was capitalized and included in proved property and depleted as part of the full cost pool. Once items are included in the full cost pool, they are indistinguishable from other proved properties. The capitalized costs within the full cost pool are amortized over the life of the total proved reserved using the unit-of-production method, computed quarterly. | ||
[2] | Operating lease cost reflect a single lease cost, calculated so that the cost of the lease is allocated over the lease term on a straight-line basis. | ||
[3] | Short-term lease costs are reported at gross amounts and primarily represent costs incurred for drilling rigs, most of which are short-term contracts not recognized as a right-of-use asset and lease liability on the balance sheet. | ||
[4] | Variable lease costs primarily represent differences between minimum payment obligations and actual operating charges incurred by the Company related to its long-term leases. |
Leases - Schedule of Right-of-U
Leases - Schedule of Right-of-Use Asset and Liability, Adjusted for Initial Direct Costs and Incentives (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 | |
Operating leases: | |||
Operating lease assets | $ 7,590 | $ 7,779 | |
Current portion of operating lease liabilities | $ 1,613 | $ 1,594 | |
Operating Lease, Liability, Current, Statement of Financial Position [Extensible List] | us-gaap:OperatingLeaseLiabilityCurrent | us-gaap:OperatingLeaseLiabilityCurrent | |
Operating lease liabilities | $ 19,138 | $ 17,239 | |
Total operating lease liabilities | 20,751 | 18,833 | |
Finance leases: | |||
Proved property | [1] | 124,299 | 124,299 |
Other current liabilities | $ 18,519 | $ 17,509 | |
Finance Lease, Liability, Current, Statement of Financial Position [Extensible List] | us-gaap:OtherLiabilitiesCurrent | us-gaap:OtherLiabilitiesCurrent | |
Other long-term liabilities | $ 56,967 | $ 62,026 | |
Finance Lease, Liability, Noncurrent, Statement of Financial Position [Extensible List] | us-gaap:OtherLiabilitiesNoncurrent | us-gaap:OtherLiabilitiesNoncurrent | |
Total finance lease liabilities | $ 75,486 | $ 79,535 | |
[1] | The HP-I is utilized in the Company’s oil and natural gas development activities and the right-of-use asset was capitalized and included in proved property and depleted as part of the full cost pool. Once items are included in the full cost pool, they are indistinguishable from other proved properties. The capitalized costs within the full cost pool are amortized over the life of the total proved reserves using the unit-of-production method, computed quarterly. |
Leases - Schedule of Lease Matu
Leases - Schedule of Lease Maturity (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Leases [Abstract] | ||
Operating Leases, 2020 (excluding the three months ended March 31, 2020) | $ 2,289 | |
Operating Leases, 2021 | 4,079 | |
Operating Leases, 2022 | 4,302 | |
Operating Leases, 2023 | 4,239 | |
Operating Leases, 2024 | 3,314 | |
Operating Leases, Thereafter | 15,790 | |
Operating Leases, Total lease payments | 34,013 | |
Operating Leases, Imputed interest | (13,262) | |
Operating Leases | 20,751 | $ 18,833 |
Finance Leases, 2020 (excluding the three months ended March 31, 2020) | 24,943 | |
Finance Leases, 2021 | 33,257 | |
Finance Leases, 2022 | 33,257 | |
Finance Leases, 2023 | 13,857 | |
Finance Leases, Total lease payments | 105,314 | |
Finance Leases, Imputed interest | (29,828) | |
Finance Leases | $ 75,486 | $ 79,535 |
Leases - Schedule of Weighted A
Leases - Schedule of Weighted Average Remaining Lease Term and Discount Rate (Details) | Mar. 31, 2020 | Mar. 31, 2019 |
Weighted average remaining lease term: | ||
Operating leases | 8 years 3 months 18 days | 6 years |
Finance leases | 3 years 2 months 12 days | 4 years |
Weighted average discount rate: | ||
Operating leases | 10.30% | 11.60% |
Finance leases | 21.90% | 21.90% |
Leases - Supplemental Cash Flow
Leases - Supplemental Cash Flow Information Related to Leases (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Cash Paid For Amounts Included In Measurement Of Lease Liabilities [Abstract] | ||
Operating cash outflow from finance leases | $ 4,265 | $ 4,994 |
Financing cash outflow from finance leases | 4,049 | 3,311 |
Operating cash outflow from operating leases | $ 455 | 453 |
Right-of-use assets obtained in exchange for new operating lease liabilities | $ 613 |
Financial Instruments - Schedul
Financial Instruments - Schedule of Carrying Amounts and Estimated Fair Values of Financial Instruments (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 | |
Oil and Natural Gas Derivatives | |||
Debt Instrument [Line Items] | |||
Carrying Amount | $ 195,163 | $ (11,594) | |
Fair Value | 195,163 | (11,594) | |
11.00% Second-Priority Senior Secured Notes – due April 2022 | |||
Debt Instrument [Line Items] | |||
Carrying Amount | [1] | 384,571 | 383,871 |
Fair Value | [1] | 240,384 | 401,128 |
7.50% Senior Notes – due May 2022 | |||
Debt Instrument [Line Items] | |||
Carrying Amount | 6,060 | 6,060 | |
Fair Value | 3,030 | 5,030 | |
Bank Credit Facility – matures May 2022 | |||
Debt Instrument [Line Items] | |||
Carrying Amount | 642,531 | 343,050 | |
Fair Value | $ 650,000 | $ 350,000 | |
[1] |
Financial Instruments - Sched_2
Financial Instruments - Schedule of Carrying Amounts and Estimated Fair Values of Financial Instruments (Parenthetical) (Details) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2020 | Dec. 31, 2019 | |
Bank Credit Facility – matures May 2022 | ||
Debt Instrument [Line Items] | ||
Senior notes, maturity date | May 10, 2022 | May 10, 2022 |
11.00% Second-Priority Senior Secured Notes – due April 2022 | ||
Debt Instrument [Line Items] | ||
Debt instrument interest rate | 11.00% | 11.00% |
Senior notes, maturity date | Apr. 3, 2022 | Apr. 3, 2022 |
7.50% Senior Notes – due May 2022 | ||
Debt Instrument [Line Items] | ||
Debt instrument interest rate | 7.50% | 7.50% |
Senior notes, maturity date | May 31, 2022 | May 31, 2022 |
Financial Instruments - Additio
Financial Instruments - Additional Information (Details) | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2020USD ($)counterparty | Dec. 31, 2019 | May 10, 2018USD ($) | |
Investment Grade Credit Rating | |||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | |||
Number of counterparties | counterparty | 10 | ||
11.00% Second-Priority Senior Secured Notes – due April 2022 | |||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | |||
Debt instrument interest rate | 11.00% | 11.00% | |
Senior notes, maturity date | Apr. 3, 2022 | Apr. 3, 2022 | |
7.50% Senior Notes – due May 2022 | |||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | |||
Debt instrument interest rate | 7.50% | 7.50% | |
Senior notes, maturity date | May 31, 2022 | May 31, 2022 | |
Senior notes, principal amount | $ 6,100,000 | ||
New Bank Credit Facility | |||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | |||
Senior notes, maturity date | May 10, 2022 | ||
Credit facility, maximum borrowing capacity | $ 1,150,000,000 | ||
Stone Energy Corporation | 11.00% Second-Priority Senior Secured Notes – due April 2022 | |||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | |||
Debt instrument interest rate | 11.00% | ||
Senior notes, maturity date | Apr. 3, 2022 | ||
Senior notes, principal amount | $ 390,900,000 | ||
Stone Energy Corporation | 7.50% Senior Notes – due May 2022 | |||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | |||
Debt instrument interest rate | 7.50% | ||
Senior notes, maturity date | May 31, 2022 | ||
Senior notes, principal amount | $ 6,100,000 |
Financial Instruments - Sched_3
Financial Instruments - Schedule of Impact that Derivatives not Qualifying as Hedging Instruments in Condensed Consolidated Statements of Operations (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Derivative Instruments And Hedging Activities Disclosure [Abstract] | ||
Net cash received (paid) on settled derivative instruments | $ 36,460 | $ (3,019) |
Unrealized gain (loss) | 206,757 | (106,560) |
Price risk management activities income (expense) | $ 243,217 | $ (109,579) |
Financial Instruments - Sched_4
Financial Instruments - Schedule of Contracted Volumes and Weighted Average Prices and will Receive Under the Terms of Derivative Contracts (Details) | 3 Months Ended |
Mar. 31, 2020MMBTU$ / bbl$ / MMBTUbbl | |
Crude Oil | WTI | April 2020 – December 2020 | Swap | |
Derivative [Line Items] | |
Instrument Type | Swap |
Average Daily Volumes | bbl | 30,320 |
Weighted Average Swap Price | 47.94 |
Crude Oil | WTI | April 2020 – December 2020 | Collar | |
Derivative [Line Items] | |
Instrument Type | Collar |
Average Daily Volumes | bbl | 5,000 |
Weighted Average Put Price | 50 |
Weighted Average Call Price | 57.09 |
Crude Oil | WTI | January 2021 – December 2021 | Swap | |
Derivative [Line Items] | |
Instrument Type | Swap |
Average Daily Volumes | bbl | 4,230 |
Weighted Average Swap Price | 45.90 |
Crude Oil | WTI | January 2021 – December 2021 | Collar | |
Derivative [Line Items] | |
Instrument Type | Collar |
Average Daily Volumes | bbl | 1,000 |
Weighted Average Put Price | 30 |
Weighted Average Call Price | 40 |
Natural Gas | April 2020 – December 2020 | Swap | NYMEX Henry Hub | |
Derivative [Line Items] | |
Instrument Type | Swaps |
Weighted Average Swap Price | $ / MMBTU | 2.23 |
Average Daily Volumes | MMBTU | 26,000 |
Natural Gas | January 2021 – December 2021 | Swap | NYMEX Henry Hub | |
Derivative [Line Items] | |
Instrument Type | Swaps |
Weighted Average Swap Price | $ / MMBTU | 2.40 |
Average Daily Volumes | MMBTU | 30,000 |
Financial Instruments - Summary
Financial Instruments - Summary of Additional Information Related to Financial Instruments Measured at Fair Value on Recurring Basis (Details) - Fair Value on Recurring Basis - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Liabilities: | ||
Total net asset (liability) | $ 195,163 | $ (11,594) |
Oil And Natural Gas Swaps And Costless Collars | ||
Assets: | ||
Oil and natural gas swaps and costless collars | 201,347 | 8,393 |
Liabilities: | ||
Oil and natural gas swaps and costless collars | (6,184) | (19,987) |
Level 2 | ||
Liabilities: | ||
Total net asset (liability) | 195,163 | (11,594) |
Level 2 | Oil And Natural Gas Swaps And Costless Collars | ||
Assets: | ||
Oil and natural gas swaps and costless collars | 201,347 | 8,393 |
Liabilities: | ||
Oil and natural gas swaps and costless collars | $ (6,184) | $ (19,987) |
Financial Instruments - Sched_5
Financial Instruments - Schedule of Fair Value of Derivative Financial Instruments (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Price Risk Derivatives [Line Items] | ||
Current, Assets | $ 192,553 | $ 8,393 |
Non-current, Assets | 8,794 | |
Current, Liabilities | 4,286 | 19,476 |
Non-current, Liabilities | 1,898 | 511 |
Oil and Natural Gas Derivatives | ||
Price Risk Derivatives [Line Items] | ||
Current, Assets | 192,553 | 8,393 |
Non-current, Assets | 8,794 | |
Assets | 201,347 | 8,393 |
Current, Liabilities | 4,286 | 19,476 |
Non-current, Liabilities | 1,898 | 511 |
Liabilities | $ 6,184 | $ 19,987 |
Debt - Summary of Detail Compri
Debt - Summary of Detail Comprising Debt and Related Book Values (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Debt Instrument [Line Items] | ||
Total debt, before discount and deferred financing cost | $ 1,046,928 | $ 746,928 |
Discount and deferred financing cost | (13,766) | (13,947) |
Total debt, net of discount and deferred financing costs | 1,033,162 | 732,981 |
Senior Notes | 11.00% Second-Priority Senior Secured Notes – due April 2022 | ||
Debt Instrument [Line Items] | ||
Total debt, before discount and deferred financing cost | 390,868 | 390,868 |
Senior Notes | 7.50% Senior Notes – due May 2022 | ||
Debt Instrument [Line Items] | ||
Total debt, before discount and deferred financing cost | 6,060 | 6,060 |
Bank Credit Facility | Bank Credit Facility – matures May 2022 | ||
Debt Instrument [Line Items] | ||
Total debt, before discount and deferred financing cost | $ 650,000 | $ 350,000 |
Debt - Summary of Detail Comp_2
Debt - Summary of Detail Comprising Debt and Related Book Values (Parenthetical) (Details) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2020 | Dec. 31, 2019 | |
11.00% Second-Priority Senior Secured Notes – due April 2022 | ||
Debt Instrument [Line Items] | ||
Debt instrument interest rate | 11.00% | 11.00% |
Senior notes, maturity date | Apr. 3, 2022 | Apr. 3, 2022 |
7.50% Senior Notes – due May 2022 | ||
Debt Instrument [Line Items] | ||
Debt instrument interest rate | 7.50% | 7.50% |
Senior notes, maturity date | May 31, 2022 | May 31, 2022 |
Bank Credit Facility – matures May 2022 | ||
Debt Instrument [Line Items] | ||
Senior notes, maturity date | May 10, 2022 | |
Senior Notes | 11.00% Second-Priority Senior Secured Notes – due April 2022 | ||
Debt Instrument [Line Items] | ||
Debt instrument interest rate | 11.00% | |
Senior notes, maturity date | Apr. 3, 2022 | |
Senior Notes | 7.50% Senior Notes – due May 2022 | ||
Debt Instrument [Line Items] | ||
Debt instrument interest rate | 7.50% | |
Senior notes, maturity date | May 31, 2022 | |
Bank Credit Facility | Bank Credit Facility – matures May 2022 | ||
Debt Instrument [Line Items] | ||
Senior notes, maturity date | May 10, 2022 |
Debt - Additional information (
Debt - Additional information (Details) - USD ($) | 3 Months Ended | 12 Months Ended | ||||
Mar. 31, 2020 | Dec. 31, 2019 | Feb. 28, 2020 | Feb. 27, 2020 | May 10, 2018 | Nov. 21, 2017 | |
Debt Instrument [Line Items] | ||||||
Debt instrument redemption, description | The indenture governing the 11.00% Notes applies certain limitations on the Company’s ability and the ability of its subsidiaries to, among other things, (i) incur additional indebtedness or issue certain preferred shares; (ii) pay dividends and make certain other restricted payments; (iii) create restrictions on the payment of dividends or other distributions to the Company from its restricted subsidiaries; (iv) create liens on certain assets to secure debt; (v) make certain investments; (vi) engage in sales of assets and subsidiary stock; (vii) transfer all or substantially all of its assets or enter into merger or consolidation transactions; and (viii) engage in transactions with affiliates. The 11.00% Notes contain customary quarterly and annual reporting, financial and administrative covenants. The Company was in compliance with all debt covenants at March 31, 2020. | |||||
7.50% Senior Notes – due May 2022 | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument, redemption price, percentage | 107.50% | |||||
Debt instrument maturity date | May 31, 2022 | May 31, 2022 | ||||
Debt instrument frequency of periodic payment | semi-annually | |||||
Debt instrument payment terms | semi-annually each May 31 and November 30 | |||||
Debt instrument, interest rate, stated percentage | 7.50% | 7.50% | ||||
Debt instrument, face amount | $ 6,100,000 | |||||
7.50% Senior Notes – due May 2022 | Maximum | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument, redemption price, percentage | 105.625% | |||||
Debt instrument, option to redeem, percentage | 35.00% | |||||
7.50% Senior Notes – due May 2022 | Minimum | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument, redemption price, percentage | 100.00% | |||||
Bank Credit Facility – matures May 2022 | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument maturity date | May 10, 2022 | |||||
Debt instrument, face amount | $ 25,000,000 | |||||
Credit facility, maximum borrowing capacity | $ 1,150,000,000 | |||||
Bank credit facility, description | The Bank Credit Facility matures on May 10, 2022, provided that the Bank Credit Facility mandates a springing maturity that is 120 days prior to May 10, 2022, if greater than $25.0 million of the 11.00% Notes or any permitted refinancing indebtedness in respect thereof is outstanding on such date. | |||||
Debt instrument springing maturity period | 120 days | |||||
Commitment fee percentage | 0.50% | |||||
Line of credit facility current commitment | $ 1,150,000,000 | |||||
Undrawn commitment under credit facility | 486,400,000 | |||||
Letters of credit outstanding amount | 13,600,000 | |||||
Line of credit outstanding amount | 650,000,000 | |||||
Bank Credit Facility – matures May 2022 | Letter of Credit | ||||||
Debt Instrument [Line Items] | ||||||
Credit facility, maximum borrowing capacity | $ 200,000,000 | |||||
Bank Credit Facility – matures May 2022 | ILX and Castex | ||||||
Debt Instrument [Line Items] | ||||||
Credit facility, maximum borrowing capacity | $ 1,150,000,000 | $ 950,000,000 | ||||
Bank Credit Facility – matures May 2022 | Maximum | ||||||
Debt Instrument [Line Items] | ||||||
Debt covenant to EBITDAX | 300.00% | |||||
Bank Credit Facility – matures May 2022 | Maximum | London Interbank Offered Rate | ||||||
Debt Instrument [Line Items] | ||||||
Debt Instrument, Basis Spread on Variable Rate | 3.75% | |||||
Bank Credit Facility – matures May 2022 | Maximum | Base Rate | ||||||
Debt Instrument [Line Items] | ||||||
Debt Instrument, Basis Spread on Variable Rate | 2.75% | |||||
Bank Credit Facility – matures May 2022 | Minimum | ||||||
Debt Instrument [Line Items] | ||||||
Debt covenant current ratio | 100.00% | |||||
Bank Credit Facility – matures May 2022 | Minimum | London Interbank Offered Rate | ||||||
Debt Instrument [Line Items] | ||||||
Debt Instrument, Basis Spread on Variable Rate | 2.75% | |||||
Bank Credit Facility – matures May 2022 | Minimum | Base Rate | ||||||
Debt Instrument [Line Items] | ||||||
Debt Instrument, Basis Spread on Variable Rate | 1.75% | |||||
Senior Notes | 11.00% Second-Priority Notes - due April 2022 | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument, redemption price, percentage | 105.50% | |||||
Debt instrument maturity date | Apr. 3, 2022 | |||||
Debt instrument frequency of periodic payment | semi-annually | |||||
Debt instrument payment terms | semi-annually each April 15 and October 15 | |||||
Debt instrument, interest rate, stated percentage | 11.00% | 11.00% | ||||
Senior Notes | 11.00% Second-Priority Notes - due April 2022 | Maximum | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument, redemption price, percentage | 102.75% | |||||
Senior Notes | 11.00% Second-Priority Notes - due April 2022 | Minimum | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument, redemption price, percentage | 100.00% | |||||
Senior Notes | 7.50% Senior Notes – due May 2022 | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument maturity date | May 31, 2022 | |||||
Debt instrument, interest rate, stated percentage | 7.50% |
Employee Benefits Plans and S_3
Employee Benefits Plans and Share-Based Compensation - Additional information (Details) $ in Millions | Mar. 31, 2020USD ($)shares |
Performance Share Units | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Share-based compensation grant date fair value | $ | $ 5.8 |
Long Term Incentive Plan | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Share-Based Compensation authorized to grant | shares | 5,415,576 |
Employee Benefits Plans and S_4
Employee Benefits Plans and Share-Based Compensation - Schedule of Restricted Stock and Performance Share Units Activity (Details) | 3 Months Ended |
Mar. 31, 2020$ / sharesshares | |
Restricted Stock Units | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Unvested restricted stock units and award beginning of the period | shares | 733,777 |
Unvested restricted stock units and award, granted | shares | 1,278,095 |
Unvested restricted stock units and award, vested | shares | (225,507) |
Unvested restricted stock units and award, forfeited | shares | (36,677) |
Unvested restricted stock units and award, end of the period | shares | 1,749,688 |
Unvested weighted average grant date fair value, beginning of the period | $ / shares | $ 25.20 |
Unvested weighted average grant date fair value, granted | $ / shares | 10.04 |
Unvested weighted average grant date fair value, vested | $ / shares | 24.36 |
Unvested weighted average grant date fair value, forfeited | $ / shares | 24.72 |
Unvested weighted average grant date fair value, end of the period | $ / shares | $ 14.24 |
Performance Share Units | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Unvested restricted stock units and award beginning of the period | shares | 417,831 |
Unvested restricted stock units and award, granted | shares | 441,642 |
Unvested restricted stock units and award, forfeited | shares | (18,533) |
Unvested restricted stock units and award, end of the period | shares | 840,940 |
Unvested weighted average grant date fair value, beginning of the period | $ / shares | $ 39.31 |
Unvested weighted average grant date fair value, granted | $ / shares | 13.05 |
Unvested weighted average grant date fair value, forfeited | $ / shares | 35.74 |
Unvested weighted average grant date fair value, end of the period | $ / shares | $ 25.60 |
Employee Benefits Plans and S_5
Employee Benefits Plans and Share-Based Compensation - Summary of Assumptions Used to Calculate the Grant Date Fair Value (Details) - Performance Share Units | Mar. 05, 2020Simulation |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Number of simulations | 100,000 |
Expected term (in years) | 2 years 9 months 18 days |
Expected volatility | 48.80% |
Risk-free interest rate | 0.60% |
Employee Benefits Plans and S_6
Employee Benefits Plans and Share-Based Compensation - Schedule of Recognized Share Based Compensation Expense, Net (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | ||
Share-based compensation expense | $ 3,212 | $ 2,275 |
Less: amounts capitalized to oil and gas properties | (1,585) | (1,016) |
Total share-based compensation expense, net | $ 1,627 | $ 1,259 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Income Tax Disclosure [Abstract] | ||
Income tax expense (benefit) | $ 55,260 | $ (6,359) |
Effective tax rate | 25.90% | 5.50% |
U.S. Federal statutory rate | 21.00% | 21.00% |
Income (Loss) Per Share - Summa
Income (Loss) Per Share - Summary of Computation of Basic and Diluted Income (Loss) Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Earnings Per Share [Abstract] | ||
Net income (loss) | $ 157,749 | $ (109,636) |
Weighted average common shares outstanding — basic | 58,240 | 54,156 |
Dilutive effect of securities | 332 | |
Weighted average common shares outstanding — diluted | 58,572 | 54,156 |
Basic | $ 2.71 | $ (2.02) |
Diluted | $ 2.69 | $ (2.02) |
Anti-dilutive potentially issuable securities excluded from diluted common shares | 4,358 | 4,762 |
Related Party Transactions - Ad
Related Party Transactions - Additional Information (Details) $ in Thousands | Mar. 30, 2020shares | Feb. 28, 2020USD ($)shares | May 10, 2018RegistrationOffering | Aug. 31, 2018USD ($) | Mar. 31, 2020USD ($) | Mar. 31, 2019USD ($) | Dec. 31, 2019USD ($) |
Related Party Transaction [Line Items] | |||||||
Net of cash acquired | $ 293,095 | $ 32,916 | |||||
Legal fees incurred | 1,600 | 1,100 | |||||
Legal fees payable | 3,600 | 1,600 | |||||
Original Equity Registration Rights Agreement | |||||||
Related Party Transaction [Line Items] | |||||||
Fees incurred in conjunction with agreement | $ 200 | $ 600 | |||||
Apollo Funds | Whistler Energy II, LLC | Whistler Energy II Holdco, LLC | |||||||
Related Party Transaction [Line Items] | |||||||
Net of cash acquired | $ 14,800 | ||||||
Business acquisition, date of acquisition agreement | Aug. 31, 2018 | ||||||
Aggregate consideration of cash | $ 52,600 | ||||||
Available cash acquired | $ 37,800 | ||||||
Primary fair values of receivables acquired | $ 1,100 | ||||||
Franklin Advisers, Inc. and MacKay Shields LLC | Registration Rights Agreement | |||||||
Related Party Transaction [Line Items] | |||||||
Number of days required to file shelf registration statement | 30 days | ||||||
Number of demand registrations allowed in any twelve-month period | Registration | 2 | ||||||
Number of underwritten offerings to demand in any twelve-month period | Offering | 3 | ||||||
Number of underwritten offerings to demand | Offering | 1 | ||||||
Percentage of registrable securities owned, underwritten offerings | 5.00% | ||||||
Threshold percentage of outstanding shares of common stock for termination of agreement | 5.00% | ||||||
Registration agreement, termination description | The Registration Rights Agreement has terminated with respect to Franklin and will terminate with respect to MacKay Shields in the event that MacKay Shields ceases to beneficially own 5% or more of the then outstanding shares of the Company’s common stock. The Registration Rights Agreement will otherwise terminate at such time as there are no Registrable Securities outstanding. | ||||||
ILX and Castex | |||||||
Related Party Transaction [Line Items] | |||||||
Assets and liabilities acquired at fair value | $ 449,295 | ||||||
Net of cash acquired | 293,095 | ||||||
Aggregate consideration of cash | $ 385,000 | ||||||
ILX and Castex | Talos Energy L L C Stakeholders | |||||||
Related Party Transaction [Line Items] | |||||||
Aggregate consideration of cash | $ 385,000 | ||||||
ILX and Castex | Talos Energy L L C Stakeholders | Series A Convertible Preferred Stock | |||||||
Related Party Transaction [Line Items] | |||||||
Aggregate shares issued | shares | 110,000 | 110,000 | |||||
Shares issued upon conversion | shares | 11,000,000 | ||||||
ILX and Castex | Riverstone Funds | |||||||
Related Party Transaction [Line Items] | |||||||
Assets and liabilities acquired at fair value | $ 449,300 | ||||||
Business combination, conversion stock | 156,200 | ||||||
Net of cash acquired | $ 293,100 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Details) $ in Millions | Mar. 31, 2020USD ($) |
Bank Credit Facility | Letter of Credit | |
Loss Contingencies [Line Items] | |
Credit facility | $ 13.6 |
Production Sharing Contracts | Mexico | |
Loss Contingencies [Line Items] | |
Performance obligations | $ 669.3 |
Condensed Consolidating Finan_3
Condensed Consolidating Financial Information - Additional Information (Details) | 3 Months Ended | |
Mar. 31, 2020 | May 10, 2018 | |
Percentage of equity interest | 100.00% | |
11.00% Second-Priority Senior Secured Notes | ||
Debt instrument interest rate | 11.00% |
Condensed Consolidating Finan_4
Condensed Consolidating Financial Information - Summary of Condensed Consolidating Financial Position (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 | Mar. 31, 2019 | Dec. 31, 2018 |
Current assets: | ||||
Cash and cash equivalents | $ 106,952 | $ 87,022 | ||
Accounts receivable | ||||
Trade, net | 81,027 | 107,842 | ||
Joint interest, net | 32,894 | 16,552 | ||
Other | 36,556 | 6,346 | ||
Assets from price risk management activities | 192,553 | 8,393 | ||
Prepaid assets | 50,273 | 65,877 | ||
Other current assets | 2,046 | 1,952 | ||
Total current assets | 502,301 | 293,984 | ||
Property and equipment: | ||||
Proved properties | 4,538,100 | 4,066,260 | ||
Unproved properties, not subject to amortization | 277,050 | 194,532 | ||
Other property and equipment | 31,966 | 29,843 | ||
Total property and equipment | 4,847,116 | 4,290,635 | ||
Accumulated depreciation, depletion and amortization | (2,158,566) | (2,065,023) | ||
Total property and equipment, net | 2,688,550 | 2,225,612 | ||
Other long-term assets: | ||||
Assets from price risk management activities | 8,794 | |||
Other well equipment inventory | 9,178 | 7,732 | ||
Operating lease assets | 7,590 | 7,779 | ||
Other assets | 21,774 | 54,375 | ||
Total assets | 3,238,187 | 2,589,482 | ||
Current liabilities: | ||||
Accounts payable | 58,750 | 71,357 | ||
Accrued liabilities | 138,271 | 154,816 | ||
Accrued royalties | 24,631 | 31,729 | ||
Current portion of asset retirement obligations | 38,028 | 61,051 | ||
Liabilities from price risk management activities | 4,286 | 19,476 | ||
Accrued interest payable | 22,257 | 10,249 | ||
Current portion of operating lease liabilities | 1,613 | 1,594 | ||
Other current liabilities | 20,918 | 20,180 | ||
Total current liabilities | 308,754 | 370,452 | ||
Long-term liabilities: | ||||
Long-term debt, net of discount and deferred financing costs | 1,033,162 | 732,981 | ||
Asset retirement obligations | 387,868 | 308,427 | ||
Liabilities from price risk management activities | 1,898 | 511 | ||
Operating lease liabilities | 19,138 | 17,239 | ||
Other long-term liabilities | 92,470 | 81,595 | ||
Total liabilities | 1,843,290 | 1,511,205 | ||
Commitments and Contingencies | ||||
Stockholders' equity | 1,394,897 | 1,078,277 | $ 899,986 | $ 1,007,496 |
Total liabilities and stockholders' equity | 3,238,187 | 2,589,482 | ||
Parent | ||||
Accounts receivable | ||||
Other current assets | 53 | |||
Total current assets | 53 | |||
Other long-term assets: | ||||
Investments in subsidiaries | 1,417,909 | 1,045,886 | ||
Other assets | 1 | 33,371 | ||
Total assets | 1,417,963 | 1,079,257 | ||
Current liabilities: | ||||
Accounts payable | 564 | 428 | ||
Other current liabilities | 255 | 255 | ||
Total current liabilities | 819 | 683 | ||
Long-term liabilities: | ||||
Other long-term liabilities | 22,247 | 297 | ||
Total liabilities | 23,066 | 980 | ||
Commitments and Contingencies | ||||
Stockholders' equity | 1,394,897 | 1,078,277 | ||
Total liabilities and stockholders' equity | 1,417,963 | 1,079,257 | ||
Subsidiary Issuer | ||||
Current assets: | ||||
Cash and cash equivalents | 88,453 | 78,780 | ||
Accounts receivable | ||||
Other | 28,153 | 474 | ||
Assets from price risk management activities | 192,553 | 8,393 | ||
Prepaid assets | 2,809 | 33,323 | ||
Total current assets | 311,968 | 120,970 | ||
Property and equipment: | ||||
Other property and equipment | 24,920 | 23,142 | ||
Total property and equipment | 24,920 | 23,142 | ||
Accumulated depreciation, depletion and amortization | (11,728) | (11,001) | ||
Total property and equipment, net | 13,192 | 12,141 | ||
Other long-term assets: | ||||
Assets from price risk management activities | 8,794 | |||
Operating lease assets | 3,314 | 3,178 | ||
Investments in subsidiaries | 2,167,746 | 1,690,362 | ||
Other assets | 364 | 364 | ||
Total assets | 2,505,378 | 1,827,015 | ||
Current liabilities: | ||||
Accounts payable | 5,151 | 5,145 | ||
Accrued liabilities | 10,501 | 4,740 | ||
Liabilities from price risk management activities | 4,286 | 19,476 | ||
Accrued interest payable | 22,105 | 10,211 | ||
Current portion of operating lease liabilities | 378 | 196 | ||
Total current liabilities | 42,421 | 39,768 | ||
Long-term liabilities: | ||||
Long-term debt, net of discount and deferred financing costs | 1,027,102 | 726,921 | ||
Liabilities from price risk management activities | 1,898 | 511 | ||
Operating lease liabilities | 16,048 | 13,929 | ||
Total liabilities | 1,087,469 | 781,129 | ||
Commitments and Contingencies | ||||
Stockholders' equity | 1,417,909 | 1,045,886 | ||
Total liabilities and stockholders' equity | 2,505,378 | 1,827,015 | ||
Guarantors | ||||
Current assets: | ||||
Cash and cash equivalents | 5,231 | 593 | ||
Accounts receivable | ||||
Trade, net | 81,027 | 107,842 | ||
Joint interest, net | 26,906 | 11,567 | ||
Other | 8,097 | 5,555 | ||
Prepaid assets | 47,442 | 32,529 | ||
Other current assets | 1,993 | 1,952 | ||
Total current assets | 170,696 | 160,038 | ||
Property and equipment: | ||||
Proved properties | 4,538,100 | 4,066,260 | ||
Unproved properties, not subject to amortization | 166,450 | 87,618 | ||
Other property and equipment | 6,829 | 6,484 | ||
Total property and equipment | 4,711,379 | 4,160,362 | ||
Accumulated depreciation, depletion and amortization | (2,146,773) | (2,053,971) | ||
Total property and equipment, net | 2,564,606 | 2,106,391 | ||
Other long-term assets: | ||||
Other well equipment inventory | 9,178 | 7,732 | ||
Operating lease assets | 3,030 | 3,224 | ||
Other assets | 2,396 | 2,136 | ||
Total assets | 2,749,906 | 2,279,521 | ||
Current liabilities: | ||||
Accounts payable | 50,073 | 58,827 | ||
Accrued liabilities | 117,001 | 145,051 | ||
Accrued royalties | 24,631 | 31,729 | ||
Current portion of asset retirement obligations | 38,028 | 61,051 | ||
Accrued interest payable | 152 | 38 | ||
Current portion of operating lease liabilities | 773 | 821 | ||
Other current liabilities | 20,663 | 19,925 | ||
Total current liabilities | 251,321 | 317,442 | ||
Long-term liabilities: | ||||
Long-term debt, net of discount and deferred financing costs | 6,060 | 6,060 | ||
Asset retirement obligations | 387,868 | 308,427 | ||
Operating lease liabilities | 2,268 | 2,416 | ||
Other long-term liabilities | 70,223 | 81,298 | ||
Total liabilities | 717,740 | 715,643 | ||
Commitments and Contingencies | ||||
Stockholders' equity | 2,032,166 | 1,563,878 | ||
Total liabilities and stockholders' equity | 2,749,906 | 2,279,521 | ||
Non-Guarantors | ||||
Current assets: | ||||
Cash and cash equivalents | 13,268 | 7,649 | ||
Accounts receivable | ||||
Joint interest, net | 5,988 | 4,985 | ||
Other | 306 | 317 | ||
Prepaid assets | 22 | 25 | ||
Total current assets | 19,584 | 12,976 | ||
Property and equipment: | ||||
Unproved properties, not subject to amortization | 110,600 | 106,914 | ||
Other property and equipment | 217 | 217 | ||
Total property and equipment | 110,817 | 107,131 | ||
Accumulated depreciation, depletion and amortization | (65) | (51) | ||
Total property and equipment, net | 110,752 | 107,080 | ||
Other long-term assets: | ||||
Operating lease assets | 1,246 | 1,377 | ||
Other assets | 19,013 | 18,504 | ||
Total assets | 150,595 | 139,937 | ||
Current liabilities: | ||||
Accounts payable | 2,962 | 6,957 | ||
Accrued liabilities | 10,769 | 5,025 | ||
Current portion of operating lease liabilities | 462 | 577 | ||
Total current liabilities | 14,193 | 12,559 | ||
Long-term liabilities: | ||||
Operating lease liabilities | 822 | 894 | ||
Total liabilities | 15,015 | 13,453 | ||
Commitments and Contingencies | ||||
Stockholders' equity | 135,580 | 126,484 | ||
Total liabilities and stockholders' equity | 150,595 | 139,937 | ||
Elimination | ||||
Other long-term assets: | ||||
Investments in subsidiaries | (3,585,655) | (2,736,248) | ||
Total assets | (3,585,655) | (2,736,248) | ||
Long-term liabilities: | ||||
Commitments and Contingencies | ||||
Stockholders' equity | (3,585,655) | (2,736,248) | ||
Total liabilities and stockholders' equity | $ (3,585,655) | $ (2,736,248) |
Condensed Consolidating Finan_5
Condensed Consolidating Financial Information - Summary of Condensed Consolidating Results Of Operations (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Revenues: | ||
Total revenue | $ 187,764 | $ 178,713 |
Operating expenses: | ||
Depreciation, depletion and amortization | 93,543 | 64,587 |
Write-down of oil and natural gas properties | 57 | |
Accretion expense | 12,417 | 9,607 |
General and administrative expense | 27,469 | 17,609 |
Total operating expenses | 191,976 | 160,344 |
Operating income (expense) | (4,212) | 18,369 |
Interest expense | (25,850) | (25,218) |
Price risk management activities income (expense) | 243,217 | (109,579) |
Other income (expense) | (146) | 433 |
Income tax (expense) | (55,260) | 6,359 |
Net income (loss) | 157,749 | (109,636) |
Oil and Gas Properties | ||
Operating expenses: | ||
Lease operating expense | 58,241 | 67,959 |
Production taxes | 249 | 582 |
Parent | ||
Operating expenses: | ||
General and administrative expense | 222 | 337 |
Total operating expenses | 222 | 337 |
Operating income (expense) | (222) | (337) |
Interest expense | 7 | |
Income tax (expense) | (55,259) | 6,837 |
Equity earnings (losses) from subsidiaries | 213,223 | (116,136) |
Net income (loss) | 157,749 | (109,636) |
Subsidiary Issuer | ||
Operating expenses: | ||
Depreciation, depletion and amortization | 727 | 72 |
General and administrative expense | 16,741 | 8,606 |
Total operating expenses | 17,468 | 8,678 |
Operating income (expense) | (17,468) | (8,678) |
Interest expense | (18,622) | (16,572) |
Price risk management activities income (expense) | 243,217 | (109,579) |
Other income (expense) | 166 | 81 |
Equity earnings (losses) from subsidiaries | 5,930 | 18,612 |
Net income (loss) | 213,223 | (116,136) |
Guarantors | ||
Revenues: | ||
Total revenue | 187,757 | 178,713 |
Operating expenses: | ||
Depreciation, depletion and amortization | 92,803 | 64,510 |
Accretion expense | 12,417 | 9,607 |
General and administrative expense | 9,828 | 8,775 |
Total operating expenses | 173,538 | 151,433 |
Operating income (expense) | 14,219 | 27,280 |
Interest expense | (7,233) | (8,518) |
Other income (expense) | 184 | 471 |
Income tax (expense) | (1) | (2) |
Net income (loss) | 7,169 | 19,231 |
Guarantors | Oil and Gas Properties | ||
Operating expenses: | ||
Lease operating expense | 58,241 | 67,959 |
Production taxes | 249 | 582 |
Non-Guarantors | ||
Revenues: | ||
Total revenue | 7 | |
Operating expenses: | ||
Depreciation, depletion and amortization | 13 | 5 |
Write-down of oil and natural gas properties | 57 | |
General and administrative expense | 678 | (109) |
Total operating expenses | 748 | (104) |
Operating income (expense) | (741) | 104 |
Interest expense | (2) | (128) |
Other income (expense) | (496) | (119) |
Income tax (expense) | (476) | |
Net income (loss) | (1,239) | (619) |
Elimination | ||
Operating expenses: | ||
Equity earnings (losses) from subsidiaries | (219,153) | 97,524 |
Net income (loss) | (219,153) | 97,524 |
Oil Revenue | ||
Revenues: | ||
Revenue | 166,624 | 155,679 |
Oil Revenue | Guarantors | ||
Revenues: | ||
Revenue | 166,617 | 155,679 |
Oil Revenue | Non-Guarantors | ||
Revenues: | ||
Revenue | 7 | |
Natural Gas Revenue | ||
Revenues: | ||
Revenue | 11,898 | 14,447 |
Natural Gas Revenue | Guarantors | ||
Revenues: | ||
Revenue | 11,898 | 14,447 |
NGL Revenue | ||
Revenues: | ||
Revenue | 4,301 | 5,066 |
NGL Revenue | Guarantors | ||
Revenues: | ||
Revenue | 4,301 | 5,066 |
Other | ||
Revenues: | ||
Revenue | 4,941 | 3,521 |
Other | Guarantors | ||
Revenues: | ||
Revenue | $ 4,941 | $ 3,521 |
Condensed Consolidating Finan_6
Condensed Consolidating Financial Information - Summary of Condensed Consolidating Cash Flows (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Cash flows from operating activities: | ||
Net cash provided by (used in) operating activities | $ 110,232 | $ 41,122 |
Cash flows from investing activities: | ||
Exploration, development, and other capital expenditures | (83,588) | (102,396) |
Cash paid for acquisitions, net of cash acquired | (293,095) | (32,916) |
Net cash provided by (used in) investing activities | (376,683) | (135,312) |
Cash flows from financing activities: | ||
Proceeds from Bank Credit Facility | 300,000 | 35,000 |
Deferred financing costs | (1,285) | |
Other deferred payments | (7,575) | (6,575) |
Payment of capital lease | (4,049) | (3,311) |
Employee stock transactions | (710) | |
Net cash provided by (used in) financing activities | 286,381 | 5 |
Redemption of Senior Notes and other long-term debt | (109) | |
Repayment of Bank Credit Facility | (25,000) | |
Net increase (decrease) in cash, cash equivalents and restricted cash | 19,930 | (94,185) |
Cash, cash equivalents and restricted cash: | ||
Balance, beginning of period | 87,022 | 141,162 |
Balance, end of period | 106,952 | 46,977 |
Parent | ||
Cash flows from operating activities: | ||
Net cash provided by (used in) operating activities | 3 | (207) |
Cash flows from financing activities: | ||
Capital contributions | 207 | |
Distributions to Subsidiary Issuer | (3) | |
Net cash provided by (used in) financing activities | (3) | 207 |
Subsidiary Issuer | ||
Cash flows from operating activities: | ||
Net cash provided by (used in) operating activities | (6,781) | (9,279) |
Cash flows from investing activities: | ||
Exploration, development, and other capital expenditures | (1,604) | (1,036) |
Investments in subsidiaries | (570,118) | (441,484) |
Distributions from subsidiaries | 289,461 | 451,174 |
Net cash provided by (used in) investing activities | (282,261) | 8,654 |
Cash flows from financing activities: | ||
Proceeds from Bank Credit Facility | 300,000 | 35,000 |
Deferred financing costs | (1,285) | |
Net cash provided by (used in) financing activities | 298,715 | 10,000 |
Repayment of Bank Credit Facility | (25,000) | |
Net increase (decrease) in cash, cash equivalents and restricted cash | 9,673 | 9,375 |
Cash, cash equivalents and restricted cash: | ||
Balance, beginning of period | 78,780 | 13,541 |
Balance, end of period | 88,453 | 22,916 |
Guarantors | ||
Cash flows from operating activities: | ||
Net cash provided by (used in) operating activities | 117,271 | 72,999 |
Cash flows from investing activities: | ||
Exploration, development, and other capital expenditures | (79,194) | (94,144) |
Cash paid for acquisitions, net of cash acquired | (293,095) | (32,916) |
Net cash provided by (used in) investing activities | (372,289) | (127,060) |
Cash flows from financing activities: | ||
Other deferred payments | (7,575) | (6,575) |
Payment of capital lease | (4,049) | (3,311) |
Employee stock transactions | (710) | |
Capital contributions | 560,618 | 421,277 |
Distributions to Subsidiary Issuer | (288,628) | (450,912) |
Net cash provided by (used in) financing activities | 259,656 | (39,630) |
Redemption of Senior Notes and other long-term debt | (109) | |
Net increase (decrease) in cash, cash equivalents and restricted cash | 4,638 | (93,691) |
Cash, cash equivalents and restricted cash: | ||
Balance, beginning of period | 593 | 102,049 |
Balance, end of period | 5,231 | 8,358 |
Non-Guarantors | ||
Cash flows from operating activities: | ||
Net cash provided by (used in) operating activities | (261) | (22,391) |
Cash flows from investing activities: | ||
Exploration, development, and other capital expenditures | (2,790) | (7,216) |
Net cash provided by (used in) investing activities | (2,790) | (7,216) |
Cash flows from financing activities: | ||
Capital contributions | 9,500 | 20,000 |
Distributions to Subsidiary Issuer | (830) | (262) |
Net cash provided by (used in) financing activities | 8,670 | 19,738 |
Net increase (decrease) in cash, cash equivalents and restricted cash | 5,619 | (9,869) |
Cash, cash equivalents and restricted cash: | ||
Balance, beginning of period | 7,649 | 25,572 |
Balance, end of period | 13,268 | 15,703 |
Elimination | ||
Cash flows from investing activities: | ||
Investments in subsidiaries | 570,118 | 441,484 |
Distributions from subsidiaries | (289,461) | (451,174) |
Net cash provided by (used in) investing activities | 280,657 | (9,690) |
Cash flows from financing activities: | ||
Capital contributions | (570,118) | (441,484) |
Distributions to Subsidiary Issuer | 289,461 | 451,174 |
Net cash provided by (used in) financing activities | $ (280,657) | $ 9,690 |