Document_and_Entity_Informatio
Document and Entity Information | 9 Months Ended | |
Mar. 31, 2015 | 13-May-15 | |
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Document Period End Date | 31-Mar-15 | |
Amendment Flag | FALSE | |
Document Fiscal Period Focus | Q3 | |
Document Fiscal Year Focus | 2015 | |
Current Fiscal Year End Date | -24 | |
Entity Central Index Key | 61398 | |
Entity Filer Category | Smaller Reporting Company | |
Entity Registrant Name | MAGELLAN PETROLEUM CORP /DE/ | |
Entity Common Stock Shares Outstanding | 45,701,107 |
Consolidated_Balance_Sheets
Consolidated Balance Sheets (USD $) | Mar. 31, 2015 | Jun. 30, 2014 |
In Thousands, unless otherwise specified | ||
CURRENT ASSETS: | ||
Cash and cash equivalents | $3,031 | $16,422 |
Securities available-for-sale | 4,122 | 11,935 |
Accounts receivable — trade | 287 | 886 |
Accounts receivable — working interest partners | 218 | 0 |
Inventories | 656 | 739 |
Prepaid and other assets | 1,899 | 2,105 |
Total current assets | 10,213 | 32,087 |
PROPERTY AND EQUIPMENT, NET (SUCCESSFUL EFFORTS METHOD): | ||
Proved oil and gas properties | 29,850 | 29,335 |
Less accumulated depletion, depreciation, and amortization | -4,056 | -3,575 |
Unproved oil and gas properties | 695 | 550 |
Wells in progress | 27,464 | 21,296 |
Land, buildings, and equipment (net of accumulated depreciation of $633 and $483 as of March 31, 2015, and June 30, 2014, respectively) | 248 | 368 |
Net property and equipment | 54,201 | 47,974 |
OTHER NON-CURRENT ASSETS: | ||
Goodwill | 1,174 | 1,174 |
Other long term assets | 571 | 200 |
Total other non-current assets | 1,745 | 1,374 |
Total assets | 66,159 | 81,435 |
CURRENT LIABILITIES: | ||
Short term line of credit | 3,501 | 0 |
Current portion of asset retirement obligations | 356 | 397 |
Accounts payable | 3,283 | 3,586 |
Accrued and other liabilities | 2,109 | 2,121 |
Accrued dividends | 0 | 429 |
Total current liabilities | 9,249 | 6,533 |
LONG TERM LIABILITIES: | ||
Asset retirement obligations, net of current portion | 2,596 | 2,476 |
Contingent consideration payable | 0 | 1,852 |
Other long term liabilities | 126 | 118 |
Total long term liabilities | 2,722 | 4,446 |
COMMITMENTS AND CONTINGENCIES (Note 15) | ||
PREFERRED STOCK (Note 10): | ||
Series A convertible preferred stock (par value $0.01 per share): Authorized 28,000,000 shares, issued 20,798,719 and 20,089,436 as of March 31, 2015, and June 30, 2014, respectively; liquidation preference of $29,217 and $28,220 as of March 31, 2015, and June 30, 2014, respectively | 25,406 | 24,539 |
EQUITY: | ||
Common stock (par value $0.01 per share): Authorized 300,000,000 shares, issued, 55,376,221 and 55,004,838 as of March 31, 2015, and June 30, 2014, respectively | 554 | 550 |
Treasury stock (at cost): 9,675,114 and 9,425,114 shares as of March 31, 2015, and June 30, 2014, respectively | -9,806 | -9,344 |
Capital in excess of par value | 92,851 | 92,986 |
Accumulated deficit | -45,020 | -36,266 |
Accumulated other comprehensive loss | -9,879 | -2,009 |
Total equity attributable to Magellan Petroleum Corporation | 28,700 | 45,917 |
Non-controlling interest in subsidiary | 82 | 0 |
Total equity | 28,782 | 45,917 |
Total liabilities, preferred stock and equity | 66,159 | 81,435 |
Series A Convertible Preferred Stock [Member] | ||
PREFERRED STOCK (Note 10): | ||
Series A convertible preferred stock (par value $0.01 per share): Authorized 28,000,000 shares, issued 20,798,719 and 20,089,436 as of March 31, 2015, and June 30, 2014, respectively; liquidation preference of $29,217 and $28,220 as of March 31, 2015, and June 30, 2014, respectively | $25,406 | $24,539 |
Consolidated_Balance_Sheets_Pa
Consolidated Balance Sheets (Parentheticals) (USD $) | Mar. 31, 2015 | Jun. 30, 2014 |
In Thousands, except Share data, unless otherwise specified | ||
Accumulated depreciation | $633 | $483 |
Common stock, par value (in dollars per share) | $0.01 | $0.01 |
Common stock, shares authorized | 300,000,000 | 300,000,000 |
Common Stock, shares, outstanding | 55,376,221 | 55,004,838 |
Common stock, shares, issued | 55,376,221 | 55,004,838 |
Treasury stock, shares | 9,675,114 | 9,425,114 |
Series A Convertible Preferred Stock [Member] | ||
Preferred stock, par value (in dollars per share) | $0.01 | $0.01 |
Preferred stock, shares authorized | 28,000,000 | 28,000,000 |
Preferred stock, shares issued | 20,798,719 | 20,089,436 |
Preferred stock, shares outstanding | 20,798,719 | 20,089,436 |
Preferred stock, liquidation preference | $29,217 | $28,220 |
Consolidated_Statement_of_Oper
Consolidated Statement of Operations (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, except Share data, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 | Mar. 31, 2015 | Mar. 31, 2014 |
Income Statement [Abstract] | ||||
REVENUE FROM OIL PRODUCTION | $688 | $1,907 | $3,543 | $5,674 |
OPERATING EXPENSES: | ||||
Lease operating | 1,417 | 1,397 | 3,901 | 4,714 |
Depletion, depreciation, amortization, and accretion | 246 | 337 | 761 | 956 |
Exploration | 368 | 1,605 | 1,276 | 2,776 |
General and administrative | 2,664 | 1,588 | 7,190 | 6,411 |
Loss on investment in securities | 168 | 0 | 168 | 0 |
Total operating expenses | 4,863 | 4,927 | 13,296 | 14,857 |
Loss from operations | -4,175 | -3,020 | -9,753 | -9,183 |
OTHER INCOME (EXPENSE): | ||||
Net interest expense | -25 | -80 | -42 | -103 |
Fair value revision of contingent consideration payable | 1,888 | 0 | 1,888 | 0 |
Other income (expense) | 75 | 28 | 157 | -78 |
Total other income (expense) | 1,938 | -52 | 2,003 | -181 |
Loss from continuing operations, before tax | -2,237 | -3,072 | -7,750 | -9,364 |
Income tax expense | -43 | 0 | -43 | 0 |
Loss from continuing operations, net of tax | -2,280 | -3,072 | -7,793 | -9,364 |
DISCONTINUED OPERATIONS: | ||||
Loss from discontinued operations, net of tax | 0 | -2,589 | 0 | -5,245 |
Gain on disposal of discontinued operations, net of tax | 0 | 30,182 | 0 | 30,182 |
Net income from discontinued operations | 0 | 27,593 | 0 | 24,937 |
Net (loss) income | -2,280 | 24,521 | -7,793 | 15,573 |
Net loss attributable to non-controlling interest in subsidiary | 165 | 0 | 335 | 0 |
Net (loss) income attributable to Magellan Petroleum Corporation | -2,115 | 24,521 | -7,458 | 15,573 |
Preferred stock dividends | -437 | -432 | -1,296 | -1,267 |
Net (loss) income attributable to common stockholders | ($2,552) | $24,089 | ($8,754) | $14,306 |
(Loss) income per common share (Note 12): | ||||
Weighted average number of basic shares outstanding | 45,701,107 | 45,348,709 | 45,677,673 | 45,348,753 |
Weighted average number of diluted shares outstanding | 45,701,107 | 45,348,709 | 45,677,673 | 45,348,753 |
Basic and diluted loss per common share: | ||||
Net loss from continuing operations attributable to Magellan Petroleum Corporation, including preferred stock dividends (per share) | ($0.06) | ($0.08) | ($0.19) | ($0.23) |
Net loss from discontinued operations (per share) | $0 | $0.61 | $0 | $0.55 |
Net loss attributable to common stockholders (per share) | ($0.06) | $0.53 | ($0.19) | $0.32 |
Consolidated_Statements_of_Com
Consolidated Statements of Comprehensive Income (Loss) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 | Mar. 31, 2015 | Mar. 31, 2014 |
Statement of Comprehensive Income [Abstract] | ||||
Net (loss) income | ($2,280) | $24,521 | ($7,793) | $15,573 |
Other comprehensive (loss) income, net of tax: | ||||
Foreign currency translation (loss) gain | -431 | 823 | -2,262 | 744 |
Reclassification of foreign currency translation loss on intercompany account balances to earnings upon reversal of permanent investment in foreign subsidiaries | 659 | 0 | 659 | 0 |
Reclassification of foreign currency translation gain to earnings upon sale of subsidiary | 0 | -6,049 | 0 | -6,049 |
Reclassification of impairment loss on securities available-for-sale to earnings due to determination as other than temporary | 168 | 0 | 168 | 0 |
Unrealized holding (loss) gain on securities available-for-sale | 1,339 | 1,004 | -6,435 | 1,012 |
Other comprehensive (loss) income, net of tax | 1,735 | -4,222 | -7,870 | -4,293 |
Comprehensive (loss) income | ($545) | $20,299 | ($15,663) | $11,280 |
Consolidated_Statement_of_Chan
Consolidated Statement of Changes in Equity (USD $) | Total | Common Stock | Treasury Stock | Capital in Excess of Par Value | Accumulated Deficit | Accumulated Other Comprehensive Loss | Non-controlling Interest |
In Thousands, unless otherwise specified | |||||||
Beginning balance at Jun. 30, 2014 | $45,917 | $550 | ($9,344) | $92,986 | ($36,266) | ($2,009) | $0 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Formation of Utah CO2 LLC | 96 | 96 | |||||
Contributions to Utah CO2 LLC | 321 | 321 | |||||
Net loss | -7,793 | -7,458 | -335 | ||||
Other comprehensive loss, net of tax | -7,870 | -7,870 | |||||
Stock and stock based compensation | 1,315 | 2 | 1,313 | ||||
Executive and employee forfeiture of options upon resignation | -430 | -430 | |||||
Executive forfeiture of restricted stock upon resignation | -44 | -1 | -43 | ||||
Purchase of stock and options from former executive | -1,445 | -462 | -983 | ||||
Net shares repurchased for employee tax costs upon vesting of restricted stock | -104 | -104 | |||||
Stock options exercised, net of shares withheld to satisfy employee tax obligations | 115 | 3 | 112 | ||||
Preferred stock dividend | -1,296 | -1,296 | |||||
Ending balance at Mar. 31, 2015 | $28,782 | $554 | ($9,806) | $92,851 | ($45,020) | ($9,879) | $82 |
Consolidated_Statements_of_Cas
Consolidated Statements of Cash Flows (USD $) | 9 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
OPERATING ACTIVITIES: | ||
Net (loss) income | ($7,793) | $15,573 |
Adjustments to reconcile net (loss) income to net cash used in operating activities: | ||
Foreign transaction loss | 659 | 0 |
Depletion, depreciation, amortization, and accretion | 761 | 956 |
Fair value revision of contingent consideration payable | -1,888 | 0 |
Accretion expense of contingent consideration payable | 36 | 234 |
Inventory book to physical adjustment | 123 | 0 |
Loss on investment in securities | 168 | 0 |
Gain on disposal of Amadeus Basin assets | 0 | -30,182 |
Exploration costs previously capitalized | 20 | 733 |
Stock compensation expense | 841 | 1,667 |
Net changes in operating assets and liabilities: | ||
Accounts receivable | 542 | -64 |
Inventories | -86 | 165 |
Prepayments and other current assets | 162 | -410 |
Accounts payable and accrued liabilities | -65 | 473 |
Net cash used in operating activities of continuing operations | -6,520 | -10,855 |
INVESTING ACTIVITIES: | ||
Additions to property and equipment | -7,157 | -16,710 |
Utah CO2 option | -371 | 0 |
Proceeds from first cash installment for the sale of Amadeus Basin assets | 0 | 13,859 |
Net cash used in investing activities of continuing operations | -7,528 | -2,851 |
FINANCING ACTIVITIES: | ||
Purchase of common stock | -566 | -11 |
Purchase of stock options | -983 | 0 |
Proceeds from issuance of common stock, net | 115 | 0 |
Payment of preferred stock dividend | -859 | 0 |
Borrowings (repayments) on line of credit, net | 3,501 | 0 |
Short term debt issuances | 0 | 1,000 |
Short term debt repayments | 0 | -1,303 |
Capital contributions by non-controlling interest | 147 | 0 |
Net cash provided by (used in) financing activities of continuing operations | 1,355 | -314 |
CASH FLOWS FROM DISCONTINUED OPERATIONS: | ||
Adjustments to reconcile net loss to net cash provided by operating activities of discontinued operations | 0 | 1,366 |
Net cash used in investing activities of discontinued operations | 0 | -1,265 |
Net cash provided by discontinued operations | 0 | 101 |
Effect of exchange rate changes on cash and cash equivalents | -698 | 464 |
Net decrease in cash and cash equivalents | -13,391 | -13,455 |
Cash and cash equivalents at beginning of period | 16,422 | 32,469 |
CASH AND CASH EQUIVALENTS AT END OF PERIOD | 3,031 | 19,014 |
Supplemental disclosure of cash flow information: | ||
Cash paid for interest | 33 | 28 |
Cash paid for income taxes | 43 | 0 |
Supplemental schedule of non-cash activities: | ||
Unrealized holding loss and foreign currency translation loss on securities available-for-sale | -7,813 | 922 |
Change in accounts payable and accrued liabilities related to property and equipment | -666 | 1,070 |
Preferred stock dividends paid in kind | 867 | 1,038 |
Increase in both accrued or other liabilities and prepaid or other assets related to Sopak | 79 | 545 |
Contribution of Property | 102 | 0 |
Property contributed for capital contribution of non-controlling interest | 98 | 0 |
Accrued capital contributions of non-controlling interest | $168 | $0 |
Basis_of_Presentation
Basis of Presentation | 9 Months Ended |
Mar. 31, 2015 | |
Accounting Policies [Abstract] | |
Basis Of Presentation | Note 1 - Basis of Presentation |
Description of Operations | |
Magellan Petroleum Corporation (the "Company" or "Magellan" or "we") is an independent oil and gas exploration and production company focused on the development of CO2-enhanced oil recovery ("CO2-EOR") projects in the Rocky Mountain region. Historically active internationally, Magellan also owns significant exploration acreage in the Weald Basin, onshore UK, and an exploration block, NT/P82, in the Bonaparte Basin, offshore Northern Territory, Australia, which the Company currently plans to farmout. | |
The Company conducts its operations through three wholly owned subsidiaries corresponding to the geographical areas in which the Company operates: Nautilus Poplar LLC ("NP") in the US, Magellan Petroleum (UK) Limited ("MPUK"), and Magellan Petroleum Australia Pty Ltd ("MPA"). | |
Our strategy is to enhance shareholder value by maximizing the value of our CO2-EOR business and our international projects. We are committed to efficiently investing financial, technical, and management capital in our projects in order to achieve the greatest risk-adjusted value and returns for our shareholders. | |
We were founded in 1957 and incorporated in Delaware in 1967. The Company's common stock has been trading on NASDAQ since 1972 under the ticker symbol "MPET". | |
Our principal executive offices are located at 1775 Sherman Street, Suite 1950, Denver, Colorado 80203, and our phone number is (720) 484-2400. | |
Principles of Consolidation and Basis of Presentation | |
The accompanying unaudited condensed consolidated financial statements include the accounts of Magellan and its wholly owned subsidiaries, NP, MPUK, and MPA, and have been prepared in accordance with accounting principles generally accepted in the United States ("GAAP") for interim financial information and in accordance with the instructions to Form 10-Q and Rule 8-03 of Regulation S-X published by the US Securities and Exchange Commission (the "SEC"). Accordingly, these interim unaudited condensed consolidated financial statements do not include all of the information and footnotes required by GAAP for complete annual period financial statements. In the opinion of management, all adjustments considered necessary for a fair presentation have been included. All such adjustments are of a normal recurring nature. All intercompany transactions have been eliminated. Operating results for the nine months ended March 31, 2015, are not necessarily indicative of the results that may be expected for the fiscal year ending June 30, 2015. This report should be read in conjunction with the consolidated financial statements and footnotes thereto included in the Company's Annual Report on Form 10-K for the fiscal year ended June 30, 2014 (the "2014 Form 10-K"). All amounts presented are in US dollars, unless otherwise noted. Amounts expressed in Australian currency are indicated as "AUD." | |
Certain amounts in our prior period financial statements have been reclassified to conform to the current period presentation. | |
During the nine months ended March 31, 2015, the Company formed a majority owned subsidiary, Utah CO2 LLC, a Delaware limited liability company ("Utah CO2"), through which the Company purchased an option to acquire CO2 at Farnham Dome in Utah. The Company owns a controlling 51% of the equity in Utah CO2 and consolidates this entity in the accompanying condensed consolidated financial statements. The remaining 49% is owned by two separate third parties. Another third-party owns a 10% economic participation interest in the Company's equity interest in Utah CO2, which participation interest does not bear any governance rights over the Company's investment in Utah CO2. The non-controlling interest reported in the accompanying condensed consolidated financial statements relates to the non-controlling interest in this entity, including the participation interest. | |
The Company owns an 11% interest in Central Petroleum Limited (ASX:CTP) ("Central"), a Brisbane-based exploration and production company traded on the Australian Securities Exchange. The Company accounts for this investment as securities available-for-sale in the accompanying condensed consolidated financial statements. | |
Use of Estimates | |
The preparation of the unaudited condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of oil and gas reserves, assets and liabilities, disclosure of contingent assets and liabilities at the date of the unaudited condensed consolidated financial statements, and the reported amounts of revenues and expenses, including stock-based compensation expense, during the reporting periods. Actual results could differ from those estimates. | |
Foreign Currency Translation | |
The functional currency of our foreign subsidiaries is their local currency. Assets and liabilities of foreign subsidiaries are translated to US dollars at period-end exchange rates, and our unaudited condensed consolidated statements of operations and cash flows are translated at average exchange rates during the reporting periods. Resulting translation adjustments are recorded in accumulated other comprehensive loss, a separate component of stockholders' equity. A component of accumulated other comprehensive loss will be released into income when the Company executes a partial or complete sale of an investment in a foreign subsidiary or a group of assets of a foreign subsidiary considered a business and/or when the Company no longer holds a controlling financial interest in a foreign subsidiary or group of assets of a foreign subsidiary considered a business. | |
Transactions denominated in currencies other than the local currency are recorded based on exchange rates at the time such transactions arise. Subsequent changes in exchange rates result in foreign currency transaction gains and losses that are reflected in results of operations as unrealized (based on period end translation) or realized (upon settlement of the transactions) and reported under general and administrative expenses in the consolidated statements of operations. | |
During the three months ended March 31, 2015, the Company made a determination that it was no longer permanently invested in its foreign subsidiaries because (i) the Company has begun an effort to repay its intercompany balances through the repatriation of cash from these subsidiaries and (ii) the Company is increasingly focusing on its US operations. As such, the Company recorded on its statement of operations an expense reclassification from accumulated other comprehensive loss arising from foreign currency exchange losses on its intercompany account balances. | |
Securities available-for-sale | |
Securities available-for-sale are comprised of investments in publicly traded securities and are carried at quoted market prices. Unrealized gains and losses are excluded from earnings and recorded as a component of accumulated other comprehensive loss in stockholders' equity, net of deferred income taxes. The Company recognizes gains or losses when securities are sold. On a quarterly basis, we perform an assessment to determine whether there have been any events or economic circumstances to indicate that a security with an unrealized loss has suffered other-than-temporary impairment. As a result of this review, during the nine months ended March 31, 2015, a loss of $168 thousand was recognized. Refer to Note 4 - Securities Available-for-Sale for further information. No impairment was recorded during the nine months ended March 31, 2014. | |
Oil and Gas Exploration and Production Activities | |
The Company follows the successful efforts method of accounting for its oil and gas exploration and production activities. Under this method, all property acquisition costs, and costs of exploratory and development wells are capitalized until a determination is made that the well has found proved reserves or is deemed noncommercial. If an exploratory well is deemed to be noncommercial, the well costs are charged to exploration expense as dry hole cost. Exploration expenses include dry hole costs, geological and geophysical expenses. Noncommercial development well costs are charged to impairment expense if circumstances indicate that a decline in the recoverability of the carrying value may have occurred. | |
The Company records its proportionate share in joint venture operations in the respective classifications of assets, liabilities, and expenses. The cost of CO2 injection is capitalized until a production response is seen as a result of the injection and it is determined that the well has found proved reserves. After oil production from the well begins, CO2 injection costs are expensed as incurred. | |
Depreciation, depletion, and amortization ("DD&A") of capitalized costs related to proved oil and gas properties is calculated on a property-by-property basis using the units-of-production method based upon proved reserves. The computation of DD&A takes into consideration restoration, dismantlement, and abandonment costs as well as the anticipated proceeds from salvaging equipment. | |
The sale of a partial interest in a proved oil and gas property is accounted for as normal retirement, and no gain or loss is recognized as long as the treatment does not significantly affect the units-of-production depletion rate. A gain or loss is recognized for all other sales of producing properties. | |
The Company reviews its proved oil and gas properties for impairment whenever events and circumstances indicate that a decline in the recoverability of their carrying value may have occurred. The Company estimates the expected undiscounted future cash flows of its oil and gas properties and compares such undiscounted future cash flows to the carrying amount of the oil and gas properties to determine if the carrying amount is recoverable. If the carrying amount exceeds the estimated undiscounted future cash flows, the Company will adjust the carrying amount of the oil and gas properties to fair value. The factors used to determine fair value include, but are not limited to, recent sales prices of comparable properties, the present value of estimated future cash flows, net of estimated operating and development costs, using estimates of reserves, future commodity pricing, future production estimates, anticipated capital expenditures, and various discount rates commensurate with the risk and current market conditions associated with realizing the expected cash flows projected. The Company undertook such a review during the quarter ended March 31, 2015, as a result of the recent decline in oil prices and concluded that no impairment was needed as of March 31, 2015. | |
Asset Retirement Obligations | |
The Company recognizes an estimated liability for future costs associated with the plugging and abandonment of its oil and gas properties. A liability for the fair value of an asset retirement obligation and corresponding increase in the carrying value of the related long-lived asset are recorded at the time a well is acquired or the liability to plug is legally incurred. The increase in carrying value is included in proved oil and gas properties in the accompanying condensed consolidated balance sheets. The Company depletes the amount added to proved oil and gas property costs, net of estimated salvage values, and recognizes expense in connection with the accretion of the discounted liability over the remaining estimated economic lives of the respective oil and gas properties. | |
Revenue Recognition | |
The Company derives revenue primarily from the sale of produced oil. Oil revenues are recognized when production is sold to a purchaser at a fixed or determinable price, when delivery has occurred and title has transferred, and collectability of the revenue is probable. Transportation costs, if and when they arise, are included in lease operating expenses. | |
Major Customers | |
The Company's consolidated oil production revenue is derived from its NP segment and was generated from a single customer for the nine months ended March 31, 2015 and 2014. | |
Stock Based Compensation | |
Stock option grants may contain time based, market based, or performance based vesting provisions. Time based options ("TBOs") are expensed on a straight-line basis over the vesting period. Market based options ("MBOs") are expensed on a straight-line basis over the derived service period, even if the market condition is not achieved. Performance based options ("PBOs") are amortized on a straight-line basis between the date upon which the achievement of the relevant performance condition is deemed probable and the date the performance condition is expected to be achieved. Management re-assesses whether achievement of performance conditions is probable at the end of each reporting period. If changes in the estimated outcome of the performance conditions affect the quantity of the awards expected to vest, the cumulative effect of the change is recognized in the period of change. | |
The fair value of the stock options is determined on the grant date and is affected by our stock price and other assumptions regarding a number of complex and subjective variables. These variables include our expected stock price volatility over the term of the awards, risk free interest rates, expected dividends, and the expected option exercise term. The Company estimates the fair value of PBOs and time based stock options using the Black-Scholes-Merton pricing model. The simplified method is used to estimate the expected term of stock options due to a lack of related historical data regarding exercise, cancellation, and forfeiture. For MBOs, the fair value is estimated using Monte Carlo simulation techniques. | |
Accumulated Other Comprehensive Loss | |
Comprehensive loss is presented net of applicable income taxes in the accompanying consolidated statements of stockholders' equity and comprehensive loss. Other comprehensive loss is comprised of revenues, expenses, gains, and losses that under GAAP are reported as separate components of stockholders' equity instead of net loss. | |
Loss per Common Share | |
Income and losses per common share are based upon the weighted average number of common and common equivalent shares outstanding during the period. The effects of potential dilutive securities in the determinations of diluted earnings per share are the dilutive effects of stock options, non-vested restricted stock, and the shares of Series A convertible preferred stock. | |
The potential dilutive impact of stock options and non-vested restricted stock is determined using the treasury stock method. The potential dilutive impact of the shares of Series A convertible preferred stock is determined using the "if-converted" method. In applying the if-converted method, conversion is not assumed for purposes of computing dilutive shares if the effect would be antidilutive. The Series A convertible preferred stock is convertible at a rate of one common share for one preferred share. We did not include any stock options, non-vested restricted stock, or common stock issuable upon the conversion of the Series A convertible preferred stock in the calculation of diluted loss per share during the three and nine months ended March 31, 2015, and 2014, as their effect would have been antidilutive. | |
Segment Information | |
As of June 30, 2013, the Company determined, based on the criteria of ASC Topic 280, that it operates in three segments, NP, MPUK, and MPA, as well as a head office, Magellan ("Corporate"), which is treated as a cost center. | |
The Company's chief operating decision maker is J. Thomas Wilson (President and CEO of the Company), who reviews the results and manages operations of the Company in the three reporting segments of NP, MPUK, and MPA, as well as Corporate. For information pertaining to our reporting segments, see Note 13 - Segment Information, and Part II, Item 8 of our 2014 Form 10-K. | |
Recently Issued Accounting Standards | |
In August 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2014-15, Presentation of Financial Statements - Going Concern. The objective of ASU 2014-15 is to provide guidance on management’s responsibility to evaluate whether there is substantial doubt about a company’s ability to continue as a going concern and to provide related footnote disclosures. ASU 2014-15 is effective for fiscal years ending after December 15, 2016, and annual and interim periods thereafter. The Company is evaluating the impact of the adoption of this standard on its condensed consolidated financial statements. | |
In June 2014, the FASB issued ASU No. 2014-12, “Compensation-Stock Compensation (Topic 718): Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period.” ASU 2014-12 requires a reporting entity to treat a performance target that affects vesting and that could be achieved after the requisite service period as a performance condition. It is effective for annual periods, and interim periods within those annual periods, beginning after December 15, 2015. Early adoption is permitted. ASU 2014-12 may be adopted either prospectively for share-based payment awards granted or modified on or after the effective date, or retrospectively, using a modified retrospective approach. The modified retrospective approach would apply to share-based payment awards outstanding as of the beginning of the earliest annual period presented in the financial statements on adoption, and to all new or modified awards thereafter. The Company has chosen to early adopt this standard retrospectively to July 1, 2013, which adoption did not impact the Company's condensed consolidated financial statements. | |
In May 2014, the FASB issued ASU 2014-09, which establishes a comprehensive new revenue recognition standard designed to depict the transfer of goods or services to a customer in an amount that reflects the consideration the entity expects to receive in exchange for those goods or services. In doing so, companies may need to use more judgment and make more estimates than under current revenue recognition guidance. The ASU allows for the use of either the full or modified retrospective transition method, and the standard as written will be effective for us in the first quarter of our fiscal year 2018 unless a deferral for adoption is provided by the FASB; early adoption is not permitted. In April, 2015, the FASB issued a proposed ASU that would defer adoption of ASU 2014-09 by one year. If the proposed ASU is adopted, ASU 2014-9 will be effective for us in the first quarter of our fiscal year 2019. The Company is currently evaluating which transition approach to use and the impact of the adoption of this standard on its condensed consolidated financial statements. |
Sale_of_Amadeus_Basin_Assets
Sale of Amadeus Basin Assets | 9 Months Ended |
Mar. 31, 2015 | |
Extractive Industries [Abstract] | |
Sale of Amadeus Basin Assets | Note 2 - Sale of Amadeus Basin Assets |
On March 31, 2014 (the "Central Closing Date"), pursuant to the Share Sale and Purchase Deed dated February 17, 2014 (the "Sale Deed"), the Company sold its Amadeus Basin assets, the Palm Valley and Dingo gas fields ("Palm Valley" and "Dingo," respectively), to Central through the sale of the Company's wholly owned subsidiary, Magellan Petroleum (N.T.) Pty. Ltd ("MPNT"), to Central's wholly owned subsidiary Central Petroleum PV Pty. Ltd ("Central PV"). In exchange for the assets, Central paid to Magellan (i) AUD $20,000 thousand, (ii) customary purchase price adjustments amounting to AUD $800 thousand; and (iii) 39.5 million newly issued shares of Central stock (ASX: CTP), equivalent to an ownership interest in Central of approximately 11%. | |
The Sale Deed also provides that the Company is entitled to receive 25% of the revenues generated at the Palm Valley gas field from gas sales when the volume-weighted gas price realized at Palm Valley exceeds AUD $5.00/Gigajoule ("GJ") and AUD $6.00/GJ for the first 10 years following the Central Closing Date and for the following 5 years, respectively, with such prices to be escalated in accordance with the Australian CPI. Between the third and fifth anniversaries of the Central Closing Date, inclusive, the Company may seek from Central a one-time payment (the "Bonus Discharge Amount") corresponding to the present value, assuming an annual discount rate of 10%, of any expected remaining bonus payments in exchange for foregoing future bonus payments. If the Company receives the Bonus Discharge Amount, bonus payments and the Bonus Discharge Amount together may not exceed AUD $7,000 thousand. The Company also retained its rights to receive any and all bonuses (the "Mereenie Bonus") payable by Santos Ltd ("Santos") and contingent upon production at the Mereenie oil and gas field achieving certain threshold levels. The Mereenie Bonus was established in 2011 pursuant to the terms of the asset swap agreement between the Company and Santos for the sale of the Company's interest in Mereenie to Santos and the Company's purchase of the interests of Santos in the Palm Valley and Dingo gas fields. For additional information, see Note 3 - Discontinued Operations. |
Discontinued_Operations
Discontinued Operations | 9 Months Ended | ||||||||||||||||
Mar. 31, 2015 | |||||||||||||||||
Discontinued Operations and Disposal Groups [Abstract] | |||||||||||||||||
Discontinued Operations | Note 3 - Discontinued Operations | ||||||||||||||||
As discussed in detail in Note 2 - Sale of Amadeus Basin Assets, on March 31, 2014, pursuant to the Sale Deed, the Company completed the sale of Palm Valley and Dingo to Central PV. The assets of Palm Valley and Dingo were previously reported under the MPA segment. Accordingly, MPA's results of operations associated with this sale were reclassified to discontinued operations in the third quarter of fiscal year 2014. Prior period amounts related to discontinued operations in the unaudited condensed consolidated statement of operations and statement of cash flows have also been reclassified to conform to the current period presentation. Summarized results of the Company's discontinued operations are as follows: | |||||||||||||||||
THREE MONTHS ENDED | NINE MONTHS ENDED | ||||||||||||||||
March 31, | March 31, | ||||||||||||||||
2015 | 2014 | 2015 | 2014 | ||||||||||||||
(In thousands) | (In thousands) | ||||||||||||||||
Revenue | $ | — | $ | 356 | $ | — | $ | 814 | |||||||||
Net income from discontinued operations | $ | — | $ | 27,593 | $ | — | $ | 24,937 | |||||||||
The Company recorded purchase price adjustments pursuant to the Sale Deed relating to the reimbursement of Dingo development costs and post completion costs. As of March 31, 2014, the gain related to the Company's discontinued operations is summarized as follows: | |||||||||||||||||
March 31, | |||||||||||||||||
2014 | |||||||||||||||||
(In thousands) | |||||||||||||||||
Assets and liabilities sold | |||||||||||||||||
Property and equipment, net | $ | (10,100 | ) | ||||||||||||||
Deferred income taxes | (7,217 | ) | |||||||||||||||
Goodwill allocated to disposal group | (1,000 | ) | |||||||||||||||
Asset retirement obligations | 4,457 | ||||||||||||||||
Other assets and liabilities, net | 1,178 | ||||||||||||||||
Total assets and liabilities of discontinued operations | (12,682 | ) | |||||||||||||||
Consideration | |||||||||||||||||
First cash installment - received on Central Closing Date | 13,859 | ||||||||||||||||
Second cash installment - received on April 15, 2014 | 4,624 | ||||||||||||||||
Stock of Central | 19,147 | ||||||||||||||||
Total consideration | 37,630 | ||||||||||||||||
Reclassification of foreign currency translation gains to earnings upon sale of foreign subsidiary | 6,049 | ||||||||||||||||
Transaction costs | (815 | ) | |||||||||||||||
Gain on disposal of discontinued operations, net of tax | $ | 30,182 | |||||||||||||||
For additional information about the sale of the Amadeus Basin assets and the Sale Deed, see Note 2 - Sale of Amadeus Basin Assets. |
Securities_AvailableforSale
Securities Available-for-Sale | 9 Months Ended | |||||||||||||||
Mar. 31, 2015 | ||||||||||||||||
Investments, Debt and Equity Securities [Abstract] | ||||||||||||||||
Securities Available-for-Sale | Note 4 - Securities Available-for-Sale | |||||||||||||||
The following table presents the amortized cost, gross unrealized gains, gross unrealized losses, and fair market value of available-for-sale equity securities, nearly all of which are attributable to the Company's investment in Central stock, as follows: | ||||||||||||||||
March 31, 2015 | ||||||||||||||||
Amortized | Gross unrealized gains | Gross unrealized losses | Fair | |||||||||||||
cost | value | |||||||||||||||
(In thousands) | ||||||||||||||||
Equity securities | $ | 19,339 | $ | — | $ | (15,217 | ) | $ | 4,122 | |||||||
June 30, 2014 | ||||||||||||||||
Amortized | Gross unrealized gains | Gross unrealized losses | Fair | |||||||||||||
cost | value | |||||||||||||||
(In thousands) | ||||||||||||||||
Equity securities | $ | 19,339 | $ | — | $ | (7,404 | ) | $ | 11,935 | |||||||
Subsequent to March 31, 2015, the Company began the process of selling its investment in the common stock of an ASX-listed offshore exploration company other than Central for expected proceeds of approximately $24 thousand. The Company entered into this investment in 2009 and 2010 at an amortized cost of $192 thousand. Although the Company still held the investment as of March 31, 2015, as of the date of release of the accompanying condensed consolidated financial statements, the cumulative unrealized loss on this investment was deemed other-than-temporary and therefore an impairment loss of $168 thousand was recognized for the three and nine months ended March 31, 2015. |
Debt
Debt | 9 Months Ended |
Mar. 31, 2015 | |
Debt Disclosure [Abstract] | |
Debt | Note 5 - Debt |
Note Payable. The outstanding principal of a $1.7 million note payable by NP, re-issued in January 2011 (the "Note Payable"), was fully amortized as of June 30, 2014. | |
Line of Credit. The Company, through its wholly owned subsidiary NP, maintains a line of credit note (the "LCN") with West Texas State Bank ("WTSB"). As of March 31, 2015, $3,501 thousand of the total available $8,000 thousand LCN was drawn and $4,499 thousand remained available to borrow. The LCN will mature on September 30, 2015, and is subject to quarterly floating interest payments based on the Prime Rate (currently approximately 3.25%) and a floor rate of 3.25%. The LCN is secured by substantially all of NP's assets including a first lien on NP's oil and gas leases from the surface to the top of the Bakken, but excluding any rights to assets within or below the Bakken. Magellan, the parent entity of NP, provided a guarantee of the LCN secured by a pledge of its membership interest in NP. Magellan and NP are subject to certain customary restrictive covenants under the terms of the LCN. As of March 31, 2015, the Company was in compliance with all such covenants. As of May 13, 2015, the outstanding balance on the LCN totaled $5,500 thousand. The Company is currently in discussions with WTSB to convert the LCN to a term loan before the maturity date. If the Company is unable to obtain such conversion, the Company plans to repay the outstanding balance with expected proceeds from the contemplated sale of certain of its assets. |
Asset_Retirement_Obligations
Asset Retirement Obligations | 9 Months Ended | |||
Mar. 31, 2015 | ||||
Asset Retirement Obligation Disclosure [Abstract] | ||||
Asset Retirement Obligations | Note 6 - Asset Retirement Obligations | |||
The estimated valuation of asset retirement obligations ("AROs") is based on the Company's historical experience and management's best estimate of plugging and abandonment costs by field. Assumptions and judgments made by management when assessing an ARO include: (i) the existence of a legal obligation; (ii) estimated probabilities, amounts, and timing of settlements; (iii) the credit-adjusted risk-free rate to be used; and (iv) inflation rates. Accretion expense is recorded under depletion, depreciation, amortization, and accretion in the unaudited condensed consolidated statements of operations. If the recorded value of ARO requires revision, the revision is recorded to both the ARO and the asset retirement capitalized cost. | ||||
The following table summarizes the ARO activity for the nine months ended March 31, 2015: | ||||
Total | ||||
(In thousands) | ||||
Fiscal year opening balance | $ | 2,873 | ||
Accretion expense | 130 | |||
Effect of exchange rate changes | (51 | ) | ||
Balance at March 31, 2015 | 2,952 | |||
Less current asset retirement obligation | 356 | |||
Long term asset retirement obligation | $ | 2,596 | ||
In April 2015, the Company sold for nominal consideration its 40% interest in PEDL 126, the exploration license that contains the Markwells Wood-1 wellbore ("MW-1"). By selling the license and the wellbore, the Company will be able to eliminate as of June 30, 2015, $346 thousand of current asset retirement obligation liability related to MW-1 recorded on its balance sheet at March 31, 2015. Concomitantly, approximately $296 thousand of costs related to MW-1 included in wells in progress as of March 31, 2015 will be charged to operations during the three month period ending June 30, 2015. |
Fair_Value_Measurements
Fair Value Measurements | 9 Months Ended | |||||||||||||||
Mar. 31, 2015 | ||||||||||||||||
Fair Value Disclosures [Abstract] | ||||||||||||||||
Fair Value Measurements | Note 7 - Fair Value Measurements | |||||||||||||||
The Company follows authoritative guidance related to fair value measurement and disclosure, which establishes a three-level valuation hierarchy for disclosure of fair value measurements. The valuation hierarchy categorizes assets and liabilities measured at fair value into one of three different levels depending on the observability of the inputs employed in the measurement using market participant assumptions at the measurement date. Categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The three levels are defined as follows: | ||||||||||||||||
• | Level 1: Quoted prices in active markets for identical assets. | |||||||||||||||
• | Level 2: Significant other observable inputs – inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, either directly or indirectly, for substantially the full term of the financial instrument. | |||||||||||||||
• | Level 3: Significant unobservable inputs. | |||||||||||||||
The Company's assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and the consideration of factors specific to the asset or liability. The Company's policy is to recognize transfers in or out of a fair value hierarchy as of the end of the reporting period for which the event or change in circumstances caused the transfer. The Company has consistently applied the valuation techniques discussed above for all periods presented. During the nine months ended March 31, 2015, and 2014, there were no transfers in or out of Level 1, Level 2, or Level 3. | ||||||||||||||||
Assets and liabilities measured on a recurring basis | ||||||||||||||||
The Company's financial instruments, including cash and cash equivalents, accounts receivable, accounts payable, and accrued liabilities, are carried at cost, which approximates fair value due to the short term maturity of these instruments. The recorded value of the LCN (see Note 5 - Debt) approximates fair value due to its variable interest rate structure. | ||||||||||||||||
The following table presents items required to be measured at fair value on a recurring basis by the level in which they are classified within the valuation hierarchy as follows: | ||||||||||||||||
March 31, 2015 | ||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
(In thousands) | ||||||||||||||||
Assets: | ||||||||||||||||
Securities available-for-sale | $ | 4,122 | $ | — | $ | — | $ | 4,122 | ||||||||
June 30, 2014 | ||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
(In thousands) | ||||||||||||||||
Assets: | ||||||||||||||||
Securities available-for-sale | $ | 11,935 | $ | — | $ | — | $ | 11,935 | ||||||||
Liabilities: | ||||||||||||||||
Contingent consideration payable (1) | $ | — | $ | — | $ | 1,852 | $ | 1,852 | ||||||||
(1) See Note 15 - Commitments and Contingencies, below for additional information about this item. | ||||||||||||||||
The contingent consideration payable is a standalone liability that is measured at fair value on a recurring basis for which there is no available quoted market price, principal market, or market participants. The inputs for this instrument are unobservable and therefore classified as Level 3 inputs. The calculation of this liability is a significant management estimate and uses drilling and production projections based in part on the Company's reserve report for NP to estimate future production bonus payments and a discount rate that is reflective of the Company's credit adjusted borrowing rate. | ||||||||||||||||
Inputs are reviewed by management on an annual basis or more frequently as deemed appropriate, and the liability is estimated by converting estimated future production bonus payments to a single net present value using a discounted cash flow model. Payments of future production bonuses are sensitive to Poplar's 60 days rolling gross production average. The contingent consideration payable would increase with significant production increases and/or a reduction in the discount rate. | ||||||||||||||||
During the three months ended March 31, 2015, the Company undertook a review of its planned drilling program at Poplar with respect to its proved undeveloped reserves as of June 30, 2014, and determined, in light of the current oil price environment, to defer this drilling program for an indefinite period. Without this drilling program and the production volumes anticipated therefrom, the Company does not currently anticipate that the conditions for the payment of the contingent consideration will be met in the foreseeable future. As such, the Company has reversed the contingent consideration payable in its entirety as of March 31, 2015, in the accompanying condensed consolidated financial statements. | ||||||||||||||||
The following table presents information about significant unobservable inputs to the Company's Level 3 financial liability measured at fair value on a recurring basis as follows: | ||||||||||||||||
Description | Valuation technique | Significant unobservable inputs | March 31, | June 30, | ||||||||||||
2015 | 2014 | |||||||||||||||
Contingent consideration payable | Discounted cash flow model | Discount rate | N/A | 8.00% | ||||||||||||
First production payout | N/A | 30-Jun-15 | ||||||||||||||
Second production payout | N/A | N/A | ||||||||||||||
Adjustments to the fair value of the contingent consideration payable are recorded in the unaudited condensed consolidated statements of operations under other (expense) income. The following table presents a roll forward of the contingent consideration payable for the nine months ended March 31, 2015: | ||||||||||||||||
Total | ||||||||||||||||
(In thousands) | ||||||||||||||||
Fiscal year opening balance | $ | 1,852 | ||||||||||||||
Accretion expense of contingent consideration payable | 36 | |||||||||||||||
Fair value revision of contingent consideration payable | (1,888 | ) | ||||||||||||||
Balance at March 31, 2015 | $ | — | ||||||||||||||
Assets and liabilities measured on a nonrecurring basis | ||||||||||||||||
The Company also utilizes fair value to perform an impairment test on its oil and gas properties annually or whenever events and circumstances indicate that a decline in the recoverability of their carrying value may have occurred. Fair value is estimated using expected discounted future cash flows from oil and gas properties. The inputs used to determine such fair value are primarily based upon internally developed cash flow models and are also classified within Level 3. For the nine months ended March 31, 2015, the Company reviewed its proved oil and gas properties for a possible impairment as a result of the recent decline in oil prices and concluded that no impairment had occurred as of March 31, 2015. |
Income_Taxes
Income Taxes | 9 Months Ended |
Mar. 31, 2015 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Note 8 - Income Taxes |
The Company has estimated the applicable effective tax rate expected for the full fiscal year. The Company's effective tax rate used to estimate income taxes on a current year-to-date basis for the nine months ended March 31, 2015, and 2014, is 0% and 0%, respectively. Deferred tax assets ("DTAs") are recognized for the expected future tax consequences of temporary differences between the financial reporting and tax basis of assets and liabilities and for operating losses and foreign tax credit carry forwards. | |
During the three months ended March 31, 2015, the Company made a determination that it was no longer permanently invested in its foreign subsidiaries. As of March 31, 2015, the Company has estimated that it has an overall deferred tax asset of $3,580 thousand, net of a deferred tax liability related to the basis difference in its foreign subsidiaries of $9,308 thousand. A valuation allowance reduces DTAs to the estimated realizable value, which is the amount of DTAs management believes is "more-likely-than-not" to be realized in future periods. | |
We review our DTAs and valuation allowance on a quarterly basis. As part of our review, we consider positive and negative evidence, including cumulative results in recent years. Consistent with the position at June 30, 2014, the Company maintains a full valuation allowance recorded against all DTAs. The Company therefore had no recorded DTAs as of March 31, 2015. We anticipate that we will continue to record a valuation allowance against our DTAs in all jurisdictions of the Company until such time as we are able to determine that it is "more-likely-than-not" that those DTAs will be realized. | |
During the year ended June 30, 2014, the Company utilized all of its available net operating loss carryforwards from the state of Montana. As a result, the Company is subject to taxation in the state of Montana based upon its apportioned income to that state, calculated using a waters edge methodology. The Company has recorded $43 thousand of income tax expense related to the state of Montana for the three and nine months ended March 31, 2015. |
StockBased_Compensation
Stock-Based Compensation | 9 Months Ended | |||||||||||||||||
Mar. 31, 2015 | ||||||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||||||||||||||||||
Stock-Based Compensation | Note 9 - Stock Based Compensation | |||||||||||||||||
The 2012 Stock Incentive Plan | ||||||||||||||||||
On January 16, 2013, the Company's shareholders approved the Magellan Petroleum Corporation 2012 Omnibus Incentive Compensation Plan (the "2012 Stock Incentive Plan"). The 2012 Stock Incentive Plan replaced the Company's 1998 Stock Incentive Plan (the "1998 Stock Plan"). The 2012 Stock Incentive Plan provides for the granting of stock options, stock appreciation rights, restricted stock and/or restricted stock units, performance shares and/or performance units, incentive awards, cash awards, and other stock based awards to selected employees, including officers, directors, and consultants of the Company (or subsidiaries of the Company). The stated maximum number of shares of the Company's common stock authorized for awards under the 2012 Stock Incentive Plan is 5,000,000 shares plus the remaining number of shares under the 1998 Stock Plan immediately before the effective date of the 2012 Stock Incentive Plan, which was 288,435 as of January 15, 2013. The number of aggregate shares available for issuance will be reduced by 1 share for each share granted in the form of a stock option or stock appreciation right and 2 shares for each share granted in the form of any award that is not a stock option or stock appreciation right that is settled in stock. The maximum aggregate annual number of options or stock appreciation rights that may be granted to one participant is 1,000,000, and the maximum annual number of performance shares, performance units, restricted stock, or restricted stock units that may be granted to any one participant is 500,000. The maximum term of the 2012 Stock Incentive Plan is ten years. In October 2014, the Company repurchased 1,512,500 options from a former executive, which options were previously granted under the Company's 1998 Stock Plan. Pursuant to the terms of the 2012 Stock Incentive Plan, the unissued shares underlying these unexercised options were added to the shares available for issuance under the 2012 Stock Incentive Plan. | ||||||||||||||||||
Stock Option Grants | ||||||||||||||||||
Under the 2012 Stock Incentive Plan, stock option grants may contain vesting provisions such that options are TBOs, PBOs, or MBOs. During the nine months ended March 31, 2015, the Company granted 135,000 TBOs, 1,250,000 PBOs, and 400,000 MBOs to executives and employees. During the nine months ended March 31, 2014, the Company granted 1,500,000 PBOs and 1,500,000 MBOs to executives and employees. | ||||||||||||||||||
Performance targets that trigger the vesting of the 1,250,000 PBOs granted in October 2014 include: (i) procuring a commercially viable commitment for the supply of CO2 to a full-field CO2-EOR development at Poplar at or below a certain price threshold (weighted 20%); (ii) preparing Poplar for a commercially viable CO2-EOR development (weighted 40%); (iii) progressing the Company's UK operations by participation in a well in the Weald Basin (weighted 20%); and (iv) moving forward with the Farnham Dome project by both exercising one of the options related to the purchase of CO2 at Farnham Dome and identifying an applicable oil project to utilize CO2 from Farnham Dome (weighted 20%). The determination of whether any of these performance targets has been met is subject to a determination of the Board. As of March 31, 2015, no performance targets had been met. | ||||||||||||||||||
The 400,000 MBOs granted in October 2014 will vest and become exercisable, subject to certain provisions related to ongoing employment and a three-year vesting period, if, at the end of any period of 90 trading days (a “Window”), (A) the closing price of the common stock as reported by NASDAQ (the “Closing Price”) on each of the first 10 trading days of a Window equals or exceeds $5.00 per share; and (B) the median of the Closing Prices for the common stock during such Window equals or exceeds $5.00 per share. | ||||||||||||||||||
Performance metrics used to measure the potential vesting of the PBOs granted in October 2013 consist of: (i) completing the drilling of the CO2-EOR pilot program at Poplar (weighted 10%); (ii) Board approval of a full field CO2-EOR development project at Poplar (weighted 40%); (iii) sale of substantially all of the Amadeus Basin assets (weighted 20%); (iv) approval of a farmout agreement or the ability to participate in drilling one well in the Weald Basin with internally developed funding, including proceeds from a sale of assets (weighted 20%); and (v) approval and execution of a farmout agreement for drilling one well in the Bonaparte Basin (weighted 10%). As of March 31, 2015, performance metrics (i), (iii) and (iv) had been met met. | ||||||||||||||||||
Vesting of the market based stock options granted in October 2013 is subject to the Company maintaining a $2.35 per share closing price for 10 consecutive trading days and a median stock price of $2.35 over a period of 90 days. | ||||||||||||||||||
During the nine months ended March 31, 2015, 494,791 stock options were exercised, resulting in the issuance of 272,898 shares of common stock, which number is net of shares withheld to satisfy certain employee tax and exercise price obligations. During the prior year period, no stock options were exercised. | ||||||||||||||||||
During the nine months ended March 31, 2015, 2,882,085 stock options were forfeited or canceled, including 1,512,500 options repurchased from a former executive (see Note 11). During the prior year period, 41,666 stock options were canceled or forfeited. | ||||||||||||||||||
During the nine months ended March 31, 2015, 25,000 stock options expired without exercise. During the prior year period, no stock options expired. | ||||||||||||||||||
As of March 31, 2015, a total of 3,131,250 MBOs and PBOs had not vested, and 658,698 options, including forfeited or canceled options, remained available for future issuance under the 2012 Stock Incentive Plan. Stock options outstanding have expiration dates ranging from April 30, 2015, to January 12, 2025. | ||||||||||||||||||
The following table summarizes the stock option activity for the nine months ended March 31, 2015: | ||||||||||||||||||
Number of | WAEPS (1) | |||||||||||||||||
Shares | ||||||||||||||||||
Fiscal year opening balance | 10,492,291 | $1.26 | ||||||||||||||||
Granted | 1,785,000 | $1.73 | ||||||||||||||||
Exercised | (494,791 | ) | $1.09 | |||||||||||||||
Forfeited/canceled | (2,882,085 | ) | $1.14 | |||||||||||||||
Expired | (25,000 | ) | $1.03 | |||||||||||||||
Balance at March 31, 2015 | 8,875,415 | $1.40 | ||||||||||||||||
Weighted average remaining contractual term | 5.97 | years | ||||||||||||||||
(1) Weighted average exercise price per share. | ||||||||||||||||||
The fair value of stock options granted under the 2012 Stock Incentive Plan was estimated using the following weighted-average assumptions for the nine months ended: | ||||||||||||||||||
March 31, | ||||||||||||||||||
2015 | 2014 | |||||||||||||||||
TBOs | PBOs | MBOs | PBOs | MBOs | ||||||||||||||
Number of options | 135,000 | 1,250,000 | 400,000 | 1,500,000 | 1,500,000 | |||||||||||||
Weighted-average grant date fair value per share | $0.47 | $0.88 | $1.17 | $0.57 | $0.69 | |||||||||||||
Expected dividend yield | —% | —% | —% | —% | —% | |||||||||||||
Forfeiture rate | 22.60% | 15.00% | 15.00% | —% | —% | |||||||||||||
Risk free interest rate | 1.50% | 1.70% | 2.40% | 1.50% | - | 1.70% | 2.80% | |||||||||||
Expected life (years)(1) | 6 | 5.3 | - | 5.4 | 3.2 | - | 3.9 | 0.4 | - | 1.6 | 2.6 | |||||||
Expected volatility (based on historical price) | 57% | 54% | 64% | 62% | 67% | |||||||||||||
(1) Expected life assumed to be the midpoint between vesting and contractual expiry. | ||||||||||||||||||
Cancellations | ||||||||||||||||||
On October 10, 2014, Magellan entered into an Options and Stock Purchase Agreement (the "Agreement") with William H. Hastings, a former executive officer and director of the Company and a beneficial owner of more than 5% of the Company’s Common Stock as of October 10, 2014. The Agreement provided for the repurchase by the Company from Mr. Hastings of 250,000 shares of the Company’s Common Stock and options to acquire 1,512,500 shares of the Company’s Common Stock. The gross proceeds that were paid to Mr. Hastings on October 17, 2014, pursuant to the Agreement totaled $1.4 million (the "Proceeds") and were subject to applicable tax withholdings. Of the Proceeds, $983 thousand related to the repurchase of the options, which amount was subject to applicable withholding tax withheld from and remitted on behalf of the former executive in the amount of $318 thousand. The Company canceled the 1,512,500 repurchased options and, pursuant to the terms of the 2012 Stock Incentive Plan, added the unissued shares underlying these unexercised options to the shares available for issuance under the 2012 Stock Incentive Plan. Of the Proceeds, the remaining $462 thousand related to the repurchase of the shares of Common Stock. See Note 11 - Stockholders' Equity for further detail. | ||||||||||||||||||
Stock Compensation Expense | ||||||||||||||||||
The Company recorded $841 thousand and $1,667 thousand of related stock compensation expense for the nine months ended March 31, 2015 and 2014, respectively. Stock compensation expense is included in general and administrative expense in the unaudited condensed consolidated statements of operations. The $841 thousand of stock compensation expense for the nine months ended March 31, 2015 consisted of expense amortization related to prior period awards of $441 thousand, expense amortization related to current period option grants of $561 thousand, and stock awards and forfeitures as described below. As of March 31, 2015, and 2014, the unrecorded expected future compensation expense related to stock option awards was $1,424 thousand and $1,500 thousand, respectively. | ||||||||||||||||||
Stock Awards | ||||||||||||||||||
In connection with certain executive promotions effective on October 31, 2014, the Board’s Compensation, Nominating and Governance Committee (the “CNG Committee”) established a new 2015 incentive compensation program that included grants of an aggregate of 100,000 shares of restricted stock under the 2012 Stock Incentive Plan to the Company's three senior executives and 50,000 shares of restricted stock under the 2012 Stock Incentive Plan to the Chairman of the Board. Total compensation expense from the issuance of restricted stock to executives for the nine months ended March 31, 2015, was $57 thousand. | ||||||||||||||||||
The Company's director compensation policy is designed to provide the Company's non-employee directors with a portion of their annual base Board service compensation in the form of equity. On July 1, 2014, the Company issued a total of 96,330 shares of its Common Stock to non-employee directors and one board-observer pursuant to this policy and the 2012 Stock Incentive Plan. Pursuant to the compensation policy, one director elected to apply his annual compensation to the exercise of a portion of his previously awarded and vested options in lieu of receiving a share award, resulting in the issuance of an additional 21,875 shares upon exercise. Total compensation expense from the issuance of non-employee director compensation for the nine months ended March 31, 2015, was $256 thousand. | ||||||||||||||||||
Forfeitures | ||||||||||||||||||
During the nine months ended March 31, 2015, 1,369,585 unvested stock options and 100,000 unvested shares of restricted stock that were previously granted were forfeited. The forfeiture of unvested options and unvested restricted stock resulted in the reversal of previously recorded compensation expense of $430 thousand and $44 thousand, respectively, which was recorded as an offset to general and administrative expense during the nine months ended March 31, 2015 in the accompanying unaudited condensed consolidated statement of operations. |
Preferred_Stock
Preferred Stock | 9 Months Ended | |||||||||||||
Mar. 31, 2015 | ||||||||||||||
Equity [Abstract] | ||||||||||||||
Preferred Stock | Note 10 - Preferred Stock | |||||||||||||
Series A Convertible Preferred Stock Financing | ||||||||||||||
On May 10, 2013, the Company entered into a Series A Convertible Preferred Stock Purchase Agreement (the "Series A Purchase Agreement") with One Stone Holdings II LP ("One Stone"), an affiliate of One Stone Energy Partners, L.P. Pursuant to the terms of the Series A Purchase Agreement, on May 17, 2013 (the "Closing Date"), the Company issued to One Stone 19,239,734 shares of Series A Convertible Preferred Stock, par value $0.01 per share (the "Series A Preferred Stock"), at a purchase price of approximately $1.22 per share (the "Purchase Price"), for aggregate proceeds of approximately $23,501 thousand. Subject to certain conditions, each share of Series A Preferred Stock and any related unpaid accumulated dividends are convertible into one share of the Company's Common Stock, par value $0.01 per share, at an initial conversion price equal to the Purchase Price. Please refer to Note 10 - Preferred Stock of the Notes to the Consolidated Financial Statements in the Company's 2014 Form 10-K for further information regarding key terms and registration rights applicable to the Company's Series A Preferred Stock. | ||||||||||||||
The Company has analyzed the embedded features of the Series A Preferred Stock and has determined that none of the embedded features is required under US GAAP to be bifurcated from the Series A Preferred Stock and accounted for separately as a derivative. The Company recorded the transaction by recognizing the fair value of the Series A Preferred Stock at the time of issuance in the amount of $23,501 thousand. The Company will accrete the Series A Preferred Stock to the redemption value if events or circumstances indicate that redemption is probable. No accretion was recorded during the nine months ended March 31, 2015, nor during the year ended June 30, 2014. | ||||||||||||||
For the nine months ended March 31, 2015 and 2014, the Company recorded preferred stock dividends of $1,296 thousand and $1,267 thousand, respectively, related to the Series A Preferred Stock. The preferred stock dividends for the six months ended March 31, 2015, were paid in kind. Accordingly, the value of these dividends of $867 thousand was recorded and added to the preferred stock balance on the Company's balance sheet at March 31, 2015. | ||||||||||||||
The activity related to the Series A Preferred Stock for the nine months ended March 31, 2015, and the fiscal year ended June 30, 2014, is as follows: | ||||||||||||||
NINE MONTHS ENDED | FISCAL YEAR ENDED | |||||||||||||
March 31, 2015 | June 30, 2014 | |||||||||||||
Number of shares | Amount | Number of shares | Amount | |||||||||||
(In thousands, except share amounts) | ||||||||||||||
Fiscal year opening balance | 20,089,436 | $ | 24,539 | 19,239,734 | $ | 23,502 | ||||||||
PIK dividend shares issued for previously accrued dividend | — | — | 164,607 | 202 | ||||||||||
Current year PIK dividend shares issued | 709,283 | 867 | 685,095 | 835 | ||||||||||
Balance at end of period | 20,798,719 | $ | 25,406 | 20,089,436 | $ | 24,539 | ||||||||
Stockholders_Equity
Stockholders' Equity | 9 Months Ended | |||||||||||||
Mar. 31, 2015 | ||||||||||||||
Equity [Abstract] | ||||||||||||||
Stockholders' Equity | Note 11 - Stockholders' Equity | |||||||||||||
Treasury Stock | ||||||||||||||
On July 1, 2014, upon the vesting of 150,000 shares of restricted stock previously granted to executives of the Company and pursuant to the tax withholding provisions of the Company's restricted stock award agreements, the Company withheld on a cashless basis 47,920 shares to settle withholding taxes. The withheld shares were immediately canceled. | ||||||||||||||
On October 10, 2014, Magellan repurchased 250,000 shares from William H. Hastings, a former Company executive, pursuant to an Options and Stock Purchase Agreement. See Note 9 - Stock Based Compensation for further details. | ||||||||||||||
All repurchased shares of Common Stock currently being held in treasury are being held at cost, including any direct costs of repurchase. The following table summarizes the Company's treasury stock activity as follows: | ||||||||||||||
NINE MONTHS ENDED | FISCAL YEAR ENDED | |||||||||||||
March 31, 2015 | June 30, 2014 | |||||||||||||
Number of shares | Amount | Number of shares | Amount | |||||||||||
(In thousands, except share amounts) | ||||||||||||||
Fiscal year opening balance | 9,425,114 | $ | 9,344 | 9,414,176 | $ | 9,333 | ||||||||
Shares repurchased from former executive | 250,000 | 462 | — | — | ||||||||||
Net shares repurchased for employee tax and option exercise price obligations related to the vesting of restricted stock and the exercise of employee stock options | 47,920 | 104 | 10,938 | 11 | ||||||||||
Cancellation of shares repurchased | (47,920 | ) | (104 | ) | — | — | ||||||||
Balance at end of period | 9,675,114 | $ | 9,806 | 9,425,114 | $ | 9,344 | ||||||||
Loss_Income_Per_Common_Share
(Loss) Income Per Common Share | 9 Months Ended | |||||||||||||||
Mar. 31, 2015 | ||||||||||||||||
Earnings Per Share [Abstract] | ||||||||||||||||
(Loss) Income Per Common Share | Note 12 - (Loss) Income Per Common Share | |||||||||||||||
The following table summarizes the computation of basic and diluted earnings per share: | ||||||||||||||||
THREE MONTHS ENDED | NINE MONTHS ENDED | |||||||||||||||
March 31, | March 31, | |||||||||||||||
2015 | 2014 | 2015 | 2014 | |||||||||||||
(In thousands, except share and per share amounts) | ||||||||||||||||
Loss from continuing operations, net of tax | $ | (2,280 | ) | $ | (3,072 | ) | $ | (7,793 | ) | $ | (9,364 | ) | ||||
Preferred stock dividend | (437 | ) | (432 | ) | (1,296 | ) | (1,267 | ) | ||||||||
Net loss from continuing operations, including preferred stock dividends | (2,717 | ) | (3,504 | ) | (9,089 | ) | (10,631 | ) | ||||||||
Net income from discontinued operations | — | 27,593 | — | 24,937 | ||||||||||||
Net loss attributable to non-controlling interest in subsidiary | 165 | — | 335 | — | ||||||||||||
Net (loss) income attributable to common stockholders | $ | (2,552 | ) | $ | 24,089 | $ | (8,754 | ) | $ | 14,306 | ||||||
Basic weighted average shares outstanding | 45,701,107 | 45,348,709 | 45,677,673 | 45,348,753 | ||||||||||||
Add: dilutive effects of in-the-money stock options and non-vested restricted stock grants (1) | — | — | — | — | ||||||||||||
Diluted weighted average common shares outstanding | 45,701,107 | 45,348,709 | 45,677,673 | 45,348,753 | ||||||||||||
Basic loss per common share: | ||||||||||||||||
Net loss from continuing operations attributable to Magellan Petroleum Corporation, including preferred stock dividends | ($0.06) | ($0.08) | ($0.19) | ($0.23) | ||||||||||||
Net income from discontinued operations | $0.00 | $0.61 | $0.00 | $0.55 | ||||||||||||
Net (loss) income attributable to common stockholders | ($0.06) | $0.53 | ($0.19) | $0.32 | ||||||||||||
Diluted loss per common share: | ||||||||||||||||
Net loss from continuing operations attributable to Magellan Petroleum Corporation, including preferred stock dividends | ($0.06) | ($0.08) | ($0.19) | ($0.23) | ||||||||||||
Net income from discontinued operations | $0.00 | $0.61 | $0.00 | $0.55 | ||||||||||||
Net (loss) income attributable to common stockholders | ($0.06) | $0.53 | ($0.19) | $0.32 | ||||||||||||
(1) All diluted earnings per share calculations are dictated by results from continuing operations; accordingly, there were no dilutive effects on earnings per share in the periods presented since all such periods had a net loss from continuing operations. | ||||||||||||||||
There is no dilutive effect on earnings per share in periods with net losses. Stock options or shares of Common Stock issuable upon the conversion of the Series A Preferred Stock were not considered in the calculations of diluted weighted average common shares outstanding as they would be antidilutive. Potentially dilutive securities excluded from the calculation of diluted shares outstanding in periods with net losses are as follows: | ||||||||||||||||
THREE MONTHS ENDED | NINE MONTHS ENDED | |||||||||||||||
March 31, | March 31, | |||||||||||||||
2015 | 2014 | 2015 | 2014 | |||||||||||||
In-the-money stock options | — | 5,143,666 | 7,776,666 | 907,500 | ||||||||||||
Non-vested restricted stock | 350,000 | 450,000 | 350,000 | 450,000 | ||||||||||||
Convertible preferred stock | 20,798,719 | 20,089,436 | 20,798,719 | 20,089,436 | ||||||||||||
Total | 21,148,719 | 25,683,102 | 28,925,385 | 21,446,936 | ||||||||||||
Segment_Information
Segment Information | 9 Months Ended | |||||||||||||||
Mar. 31, 2015 | ||||||||||||||||
Segment Reporting [Abstract] | ||||||||||||||||
Segment Information | Note 13 - Segment Information | |||||||||||||||
The Company conducts its operations through three wholly owned subsidiaries: NP, which operates in the US; MPUK, which includes our operations in the UK; and MPA, which includes our operations in Australia. Oversight for these subsidiaries is provided by Corporate, which is treated as a cost center. | ||||||||||||||||
THREE MONTHS ENDED | NINE MONTHS ENDED | |||||||||||||||
March 31, | March 31, | |||||||||||||||
2015 | 2014 | 2015 | 2014 | |||||||||||||
(In thousands) | ||||||||||||||||
Revenue from oil production: | ||||||||||||||||
NP | $ | 688 | $ | 1,907 | $ | 3,543 | $ | 5,674 | ||||||||
Net (loss) income from continuing operations: | ||||||||||||||||
NP | $ | 481 | $ | 40 | $ | (63 | ) | $ | (536 | ) | ||||||
MPUK | (300 | ) | (1,349 | ) | (881 | ) | (2,495 | ) | ||||||||
MPA | (402 | ) | — | (1,159 | ) | — | ||||||||||
Corporate | (2,059 | ) | (1,949 | ) | (5,690 | ) | (6,700 | ) | ||||||||
Inter-segment elimination | — | 186 | — | 367 | ||||||||||||
Consolidated net loss from continuing operations | $ | (2,280 | ) | $ | (3,072 | ) | $ | (7,793 | ) | $ | (9,364 | ) | ||||
March 31, | June 30, | |||||||||||||||
2015 | 2014 | |||||||||||||||
(In thousands) | ||||||||||||||||
Total assets: | ||||||||||||||||
NP (1) | $ | 29,997 | $ | 27,299 | ||||||||||||
MPUK (1) | 3,102 | 4,486 | ||||||||||||||
MPA (1) | 4,819 | 14,073 | ||||||||||||||
Corporate | 105,490 | 111,113 | ||||||||||||||
Inter-segment elimination (2) | (77,249 | ) | (75,536 | ) | ||||||||||||
Total assets of continuing operations | $ | 66,159 | $ | 81,435 | ||||||||||||
(1) Intercompany payable balances netted in arriving at segment assets | ||||||||||||||||
(2) Asset inter-segment eliminations are primarily derived from investments in subsidiaries. |
Oil_and_Gas_Activities
Oil and Gas Activities | 9 Months Ended | |||||||
Mar. 31, 2015 | ||||||||
Oil and Gas Exploration and Production Industries Disclosures [Abstract] | ||||||||
Oil and Gas Activities | Note 14 - Oil and Gas Activities | |||||||
The following table presents the capitalized costs under the successful efforts method for oil and gas properties as of: | ||||||||
March 31, | June 30, | |||||||
2015 | 2014 | |||||||
(In thousands) | ||||||||
Proved oil and gas properties: | ||||||||
United States | $ | 29,850 | $ | 29,335 | ||||
Less accumulated depletion, depreciation, and amortization | (4,056 | ) | (3,575 | ) | ||||
Total net proved oil and gas properties | $ | 25,794 | $ | 25,760 | ||||
Unproved oil and gas properties: | ||||||||
United States | $ | 468 | $ | 268 | ||||
United Kingdom | 227 | 282 | ||||||
Australia | — | — | ||||||
Total unproved oil and gas properties | $ | 695 | $ | 550 | ||||
Wells in Progress: | ||||||||
United States | $ | 25,769 | $ | 19,686 | ||||
United Kingdom | 1,695 | 1,610 | ||||||
Total wells in progress | $ | 27,464 | $ | 21,296 | ||||
Commitments_and_Contingencies
Commitments and Contingencies | 9 Months Ended |
Mar. 31, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 15 - Commitments and Contingencies |
Refer to Note 14 - Commitments and Contingencies of the Notes to the Consolidated Financial Statements in our 2014 Form 10-K for information on all commitments. | |
Contingent production payments. In September 2011, the Company entered into a Purchase and Sale Agreement (the "Nautilus PSA") among the Company and the non-controlling interest owners of NP for the Company's acquisition of the sellers' interests in NP. The Nautilus PSA provides for potential future contingent production payments, payable by the Company in cash to the sellers, of up to a total of $5.0 million if certain increased average daily production rates for the underlying properties are achieved. J. Thomas Wilson, a director and executive officer of the Company, has an approximately 52% interest in such contingent payments. See Note 7 - Fair Value Measurements above for information regarding the estimated discounted fair value of the future contingent consideration payable related to the Nautilus PSA. | |
Sopak Collateral Agreement. On January 14, 2013, the Company entered into a Collateral Purchase Agreement (the "Collateral Agreement") with Sopak AG, a Swiss subsidiary of Glencore International plc ("Sopak"), pursuant to which the Company agreed to purchase: (i) 9,264,637 shares of the Company's Common Stock and (ii) a warrant granting Sopak the right to purchase from the Company an additional 4,347,826 shares of Common Stock. The Collateral Agreement was subsequently amended on January 15, 2013, and completed on January 16, 2013. The Company has estimated that there is the potential for a statutory liability of approximately $1,650 thousand and $1,571 thousand as of March 31, 2015, and June 30, 2014, respectively, related to US Federal tax withholdings and related penalties and interest related to the Collateral Agreement. As a result, we have recorded a total liability of $1,650 thousand and $1,571 thousand as of March 31, 2015, and June 30, 2014, respectively, under accrued and other liabilities in the unaudited condensed consolidated balance sheets included in this report. The Company has a legally enforceable right to collect from Sopak any amounts owed to the IRS as a result of the Collateral Agreement. As a result, we have recorded a corresponding receivable of $1,650 thousand and $1,571 thousand as of March 31, 2015, and June 30, 2014, respectively, under prepaid and other assets in the unaudited condensed consolidated balance sheets. | |
Broadford Bridge-1 Well. As previously reported, during the three months ended December 31, 2014, the Company received a cash call from Celtique for the advancement of estimated expenses in the amount of approximately $2,000 thousand in connection with the Broadford Bridge-1 well, and the Company is evaluating its alternatives under the applicable joint operating agreement. On March 3, 2015, MPUK received a claim form and particulars of claim issued in the High Court of Justice, Queen’s Bench Division, Commercial Court in London, England on February 26, 2015, pursuant to which Celtique Energie Weald Limited as the claimant seeks, among other things, a declaration that MPUK’s 50% equal co-ownership rights with Celtique in PEDLs 231, 234 (within which license area the Broadford Bridge-1 well site is located), and 243 in the central Weald Basin in the UK have been forfeited to Celtique, and payment of £1,540 thousand (equivalent to $2,284 thousand as of March 31, 2015) for the outstanding cash calls along with interest on that amount at 5% above base rate until payment. On April 1, 2015, MPUK filed a defense and counterclaim asserting, among other things, that the cash calls by Celtique are not valid due to the failure of Celtique as operator of the PEDLs to comply with the contractual accounting procedures, adhere to an agreed-upon drilling schedule and otherwise properly execute the parties’ development plans, and seeking to recover damages from Celtique as a result of Celtique’s unilateral actions following the purported forfeiture of the PEDL interests. MPUK believes that it has strong defenses to, and intends to vigorously contest, the claims by Celtique. However, due to the early stage of this matter and the uncertainty and risks inherent in litigation, the Company cannot predict the ultimate outcome of this matter and believes that a meaningful estimate of a reasonably possible loss, if any, or range of reasonably possible losses, if any, cannot currently be made. | |
Poplar CO2-EOR Pilot Bonus. MI3 Petroleum Engineering ("MI3") is a Golden, Colorado, based petroleum engineering firm that advises the Company with respect to its CO2-EOR activities, including the Company's CO2-EOR pilot at Poplar (See Note 16 - Related Party Transactions). Pursuant to the terms of a master services contract with MI3, in addition to contracted rates for services performed, certain contingent bonuses may become payable to MI3. The first of these will become payable upon a decision by the Company to pursue a full-field CO2-EOR development at Poplar and is estimated at $255 thousand as of March 31, 2015. The remainder of the bonuses are based on triggers related to project funding and full-field production rates. |
Related_Parties_Transactions
Related Parties Transactions | 9 Months Ended |
Mar. 31, 2015 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Note 16 - Related Party Transactions |
Davis Graham & Stubbs LLP. Milam Randolph Pharo, a Director of the Company until December 11, 2014, is currently of counsel at Davis Graham & Stubbs LLP (“DGS”), a Denver-based law firm with over 140 attorneys, of which over 65 are partners. Mr. Pharo has held that position since April 2013. Mr. Pharo has a compensation arrangement with DGS such that Mr. Pharo has an interest in the amount of fees paid by the Company to DGS for certain legal services performed by DGS for the Company. During the nine months ended March 31, 2015, and 2014, the Company recorded $307 thousand and $82 thousand, respectively, of legal fees related to DGS, with respect to which amounts Mr. Pharo had a compensation interest of $0 and less than $2,500, respectively. | |
Devizes International Consulting Limited. A director of Celtique, with which the Company co-owns equally several licenses in the UK, is also the sole owner of Devizes International Consulting Limited ("Devizes"). Devizes performs consulting related services to MPUK. The Company recorded $137 thousand and $85 thousand of consulting fees related to Devizes during the nine months ended March 31, 2015, and 2014, respectively. | |
Key Energy Services, Inc. ("KES"). J. Robinson West, the Chairman of the Board of Directors of the Company, also served as a non-employee director on the board of directors for KES until May 2014. KES performed contract drilling rig services for the Company in Poplar during the first and second quarters of fiscal year 2014. The total contract fees payable to KES from activities during the nine months ended March 31, 2014, was $2,200 thousand. During the nine months ended March 31, 2015, KES performed no services for the Company, and J. Robinson West was no longer a director of KES. | |
Mervyn Cowie. Mervyn Cowie, a former employee of the Company's MPA subsidiary, currently serves both as a director of MPA and its subsidiaries and as a consultant to MPA. Since December 1, 2014, the recurring monthly fee payable to Mr. Cowie for his consulting services amounts to AUD $5,400. | |
MI3 Petroleum Engineering. In association with its purchase of an option to acquire Farnham Dome, the Company established Utah CO2, a majority owned subsidiary having two non-controlling interest owners, one of which is MI4 Oil and Gas LLC ("MI4"). MI4 is a Colorado limited liability company majority owned by Carlos Pereira, who is also the majority owner of MI3. MI3 performs ongoing consulting work for both Utah CO2 and other Magellan entities. During the nine months ended March 31, 2015, the Company recorded $502 thousand of fees payable to MI3 with respect to work performed for Utah CO2. |
Employee_Severance_Costs
Employee Severance Costs | 9 Months Ended |
Mar. 31, 2015 | |
Restructuring and Related Activities [Abstract] | |
Employee Severance Costs | Note 17 - Employee Severance Costs |
The Company is required to record charges for one-time employee severance benefits and other associated costs as incurred. In July 2012, the Company incurred severance costs payable in connection with the termination of the employment of certain employees pursuant to the terms of their employment agreements, $250 thousand of which were paid during the nine months ended March 31, 2014. | |
On March 31, 2014, the Company sold its interests in Palm Valley and Dingo to Central. Pursuant to the Sale Deed, the Company incurred severance costs payable in connection with the termination of certain MPA employees. For the nine months ended March 31, 2014, the Company expensed total employee-related severance costs of approximately $1,500 thousand, all of which were charged to loss from discontinued operations, net of tax, in the unaudited condensed consolidated statement of operations. All related severance benefits were paid as of June 30, 2014. | |
On August 31, 2014, the Company provided a notice of termination to the only remaining employee of its MPA subsidiary. As a result, during the nine months ended March 31, 2015, the Company expensed and paid total employee-related severance costs of $475 thousand. |
Basis_of_Presentation_Policies
Basis of Presentation (Policies) | 9 Months Ended |
Mar. 31, 2015 | |
Accounting Policies [Abstract] | |
Principles of Consolidation and Basis of Presentation | Principles of Consolidation and Basis of Presentation |
The accompanying unaudited condensed consolidated financial statements include the accounts of Magellan and its wholly owned subsidiaries, NP, MPUK, and MPA, and have been prepared in accordance with accounting principles generally accepted in the United States ("GAAP") for interim financial information and in accordance with the instructions to Form 10-Q and Rule 8-03 of Regulation S-X published by the US Securities and Exchange Commission (the "SEC"). Accordingly, these interim unaudited condensed consolidated financial statements do not include all of the information and footnotes required by GAAP for complete annual period financial statements. In the opinion of management, all adjustments considered necessary for a fair presentation have been included. All such adjustments are of a normal recurring nature. All intercompany transactions have been eliminated. Operating results for the nine months ended March 31, 2015, are not necessarily indicative of the results that may be expected for the fiscal year ending June 30, 2015. This report should be read in conjunction with the consolidated financial statements and footnotes thereto included in the Company's Annual Report on Form 10-K for the fiscal year ended June 30, 2014 (the "2014 Form 10-K"). All amounts presented are in US dollars, unless otherwise noted. Amounts expressed in Australian currency are indicated as "AUD." | |
Certain amounts in our prior period financial statements have been reclassified to conform to the current period presentation. | |
During the nine months ended March 31, 2015, the Company formed a majority owned subsidiary, Utah CO2 LLC, a Delaware limited liability company ("Utah CO2"), through which the Company purchased an option to acquire CO2 at Farnham Dome in Utah. The Company owns a controlling 51% of the equity in Utah CO2 and consolidates this entity in the accompanying condensed consolidated financial statements. The remaining 49% is owned by two separate third parties. Another third-party owns a 10% economic participation interest in the Company's equity interest in Utah CO2, which participation interest does not bear any governance rights over the Company's investment in Utah CO2. The non-controlling interest reported in the accompanying condensed consolidated financial statements relates to the non-controlling interest in this entity, including the participation interest. | |
The Company owns an 11% interest in Central Petroleum Limited (ASX:CTP) ("Central"), a Brisbane-based exploration and production company traded on the Australian Securities Exchange. The Company accounts for this investment as securities available-for-sale in the accompanying condensed consolidated financial statements. | |
Use of Estimates | Use of Estimates |
The preparation of the unaudited condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of oil and gas reserves, assets and liabilities, disclosure of contingent assets and liabilities at the date of the unaudited condensed consolidated financial statements, and the reported amounts of revenues and expenses, including stock-based compensation expense, during the reporting periods. Actual results could differ from those estimates. | |
Foreign Currency Translation | Foreign Currency Translation |
The functional currency of our foreign subsidiaries is their local currency. Assets and liabilities of foreign subsidiaries are translated to US dollars at period-end exchange rates, and our unaudited condensed consolidated statements of operations and cash flows are translated at average exchange rates during the reporting periods. Resulting translation adjustments are recorded in accumulated other comprehensive loss, a separate component of stockholders' equity. A component of accumulated other comprehensive loss will be released into income when the Company executes a partial or complete sale of an investment in a foreign subsidiary or a group of assets of a foreign subsidiary considered a business and/or when the Company no longer holds a controlling financial interest in a foreign subsidiary or group of assets of a foreign subsidiary considered a business. | |
Transactions denominated in currencies other than the local currency are recorded based on exchange rates at the time such transactions arise. Subsequent changes in exchange rates result in foreign currency transaction gains and losses that are reflected in results of operations as unrealized (based on period end translation) or realized (upon settlement of the transactions) and reported under general and administrative expenses in the consolidated statements of operations. | |
During the three months ended March 31, 2015, the Company made a determination that it was no longer permanently invested in its foreign subsidiaries because (i) the Company has begun an effort to repay its intercompany balances through the repatriation of cash from these subsidiaries and (ii) the Company is increasingly focusing on its US operations. As such, the Company recorded on its statement of operations an expense reclassification from accumulated other comprehensive loss arising from foreign currency exchange losses on its intercompany account balances. | |
Securities available-for-sale | Securities available-for-sale |
Securities available-for-sale are comprised of investments in publicly traded securities and are carried at quoted market prices. Unrealized gains and losses are excluded from earnings and recorded as a component of accumulated other comprehensive loss in stockholders' equity, net of deferred income taxes. The Company recognizes gains or losses when securities are sold. On a quarterly basis, we perform an assessment to determine whether there have been any events or economic circumstances to indicate that a security with an unrealized loss has suffered other-than-temporary impairment. As a result of this review, during the nine months ended March 31, 2015, a loss of $168 thousand was recognized. Refer to Note 4 - Securities Available-for-Sale for further information. No impairment was recorded during the nine months ended March 31, 2014 | |
Oil and Gas Exploration and Production Activities | Oil and Gas Exploration and Production Activities |
The Company follows the successful efforts method of accounting for its oil and gas exploration and production activities. Under this method, all property acquisition costs, and costs of exploratory and development wells are capitalized until a determination is made that the well has found proved reserves or is deemed noncommercial. If an exploratory well is deemed to be noncommercial, the well costs are charged to exploration expense as dry hole cost. Exploration expenses include dry hole costs, geological and geophysical expenses. Noncommercial development well costs are charged to impairment expense if circumstances indicate that a decline in the recoverability of the carrying value may have occurred. | |
The Company records its proportionate share in joint venture operations in the respective classifications of assets, liabilities, and expenses. The cost of CO2 injection is capitalized until a production response is seen as a result of the injection and it is determined that the well has found proved reserves. After oil production from the well begins, CO2 injection costs are expensed as incurred. | |
Depreciation, depletion, and amortization ("DD&A") of capitalized costs related to proved oil and gas properties is calculated on a property-by-property basis using the units-of-production method based upon proved reserves. The computation of DD&A takes into consideration restoration, dismantlement, and abandonment costs as well as the anticipated proceeds from salvaging equipment. | |
The sale of a partial interest in a proved oil and gas property is accounted for as normal retirement, and no gain or loss is recognized as long as the treatment does not significantly affect the units-of-production depletion rate. A gain or loss is recognized for all other sales of producing properties. | |
The Company reviews its proved oil and gas properties for impairment whenever events and circumstances indicate that a decline in the recoverability of their carrying value may have occurred. The Company estimates the expected undiscounted future cash flows of its oil and gas properties and compares such undiscounted future cash flows to the carrying amount of the oil and gas properties to determine if the carrying amount is recoverable. If the carrying amount exceeds the estimated undiscounted future cash flows, the Company will adjust the carrying amount of the oil and gas properties to fair value. The factors used to determine fair value include, but are not limited to, recent sales prices of comparable properties, the present value of estimated future cash flows, net of estimated operating and development costs, using estimates of reserves, future commodity pricing, future production estimates, anticipated capital expenditures, and various discount rates commensurate with the risk and current market conditions associated with realizing the expected cash flows projected. The Company undertook such a review during the quarter ended March 31, 2015, as a result of the recent decline in oil prices and concluded that no impairment was needed as of March 31, 2015. | |
Asset Retirement Obligations | Asset Retirement Obligations |
The Company recognizes an estimated liability for future costs associated with the plugging and abandonment of its oil and gas properties. A liability for the fair value of an asset retirement obligation and corresponding increase in the carrying value of the related long-lived asset are recorded at the time a well is acquired or the liability to plug is legally incurred. The increase in carrying value is included in proved oil and gas properties in the accompanying condensed consolidated balance sheets. The Company depletes the amount added to proved oil and gas property costs, net of estimated salvage values, and recognizes expense in connection with the accretion of the discounted liability over the remaining estimated economic lives of the respective oil and gas properties. | |
Revenue Recognition | Revenue Recognition |
The Company derives revenue primarily from the sale of produced oil. Oil revenues are recognized when production is sold to a purchaser at a fixed or determinable price, when delivery has occurred and title has transferred, and collectability of the revenue is probable. Transportation costs, if and when they arise, are included in lease operating expenses. | |
Major Customers | Major Customers |
The Company's consolidated oil production revenue is derived from its NP segment and was generated from a single customer for the nine months ended March 31, 2015 and 2014. | |
Stock Based Compensation | Stock Based Compensation |
Stock option grants may contain time based, market based, or performance based vesting provisions. Time based options ("TBOs") are expensed on a straight-line basis over the vesting period. Market based options ("MBOs") are expensed on a straight-line basis over the derived service period, even if the market condition is not achieved. Performance based options ("PBOs") are amortized on a straight-line basis between the date upon which the achievement of the relevant performance condition is deemed probable and the date the performance condition is expected to be achieved. Management re-assesses whether achievement of performance conditions is probable at the end of each reporting period. If changes in the estimated outcome of the performance conditions affect the quantity of the awards expected to vest, the cumulative effect of the change is recognized in the period of change. | |
The fair value of the stock options is determined on the grant date and is affected by our stock price and other assumptions regarding a number of complex and subjective variables. These variables include our expected stock price volatility over the term of the awards, risk free interest rates, expected dividends, and the expected option exercise term. The Company estimates the fair value of PBOs and time based stock options using the Black-Scholes-Merton pricing model. The simplified method is used to estimate the expected term of stock options due to a lack of related historical data regarding exercise, cancellation, and forfeiture. For MBOs, the fair value is estimated using Monte Carlo simulation techniques. | |
Accumulated Other Comprehensive Loss | Accumulated Other Comprehensive Loss |
Comprehensive loss is presented net of applicable income taxes in the accompanying consolidated statements of stockholders' equity and comprehensive loss. Other comprehensive loss is comprised of revenues, expenses, gains, and losses that under GAAP are reported as separate components of stockholders' equity instead of net loss. | |
Loss per Common Share | Loss per Common Share |
Income and losses per common share are based upon the weighted average number of common and common equivalent shares outstanding during the period. The effects of potential dilutive securities in the determinations of diluted earnings per share are the dilutive effects of stock options, non-vested restricted stock, and the shares of Series A convertible preferred stock. | |
The potential dilutive impact of stock options and non-vested restricted stock is determined using the treasury stock method. The potential dilutive impact of the shares of Series A convertible preferred stock is determined using the "if-converted" method. In applying the if-converted method, conversion is not assumed for purposes of computing dilutive shares if the effect would be antidilutive. The Series A convertible preferred stock is convertible at a rate of one common share for one preferred share. We did not include any stock options, non-vested restricted stock, or common stock issuable upon the conversion of the Series A convertible preferred stock in the calculation of diluted loss per share during the three and nine months ended March 31, 2015, and 2014, as their effect would have been antidilutive. | |
Segment Information | Segment Information |
As of June 30, 2013, the Company determined, based on the criteria of ASC Topic 280, that it operates in three segments, NP, MPUK, and MPA, as well as a head office, Magellan ("Corporate"), which is treated as a cost center. | |
The Company's chief operating decision maker is J. Thomas Wilson (President and CEO of the Company), who reviews the results and manages operations of the Company in the three reporting segments of NP, MPUK, and MPA, as well as Corporate. For information pertaining to our reporting segments, see Note 13 - Segment Information, and Part II, Item 8 of our 2014 Form 10-K. | |
Recently Issued Accounting Standards | Recently Issued Accounting Standards |
In August 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2014-15, Presentation of Financial Statements - Going Concern. The objective of ASU 2014-15 is to provide guidance on management’s responsibility to evaluate whether there is substantial doubt about a company’s ability to continue as a going concern and to provide related footnote disclosures. ASU 2014-15 is effective for fiscal years ending after December 15, 2016, and annual and interim periods thereafter. The Company is evaluating the impact of the adoption of this standard on its condensed consolidated financial statements. | |
In June 2014, the FASB issued ASU No. 2014-12, “Compensation-Stock Compensation (Topic 718): Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period.” ASU 2014-12 requires a reporting entity to treat a performance target that affects vesting and that could be achieved after the requisite service period as a performance condition. It is effective for annual periods, and interim periods within those annual periods, beginning after December 15, 2015. Early adoption is permitted. ASU 2014-12 may be adopted either prospectively for share-based payment awards granted or modified on or after the effective date, or retrospectively, using a modified retrospective approach. The modified retrospective approach would apply to share-based payment awards outstanding as of the beginning of the earliest annual period presented in the financial statements on adoption, and to all new or modified awards thereafter. The Company has chosen to early adopt this standard retrospectively to July 1, 2013, which adoption did not impact the Company's condensed consolidated financial statements. | |
In May 2014, the FASB issued ASU 2014-09, which establishes a comprehensive new revenue recognition standard designed to depict the transfer of goods or services to a customer in an amount that reflects the consideration the entity expects to receive in exchange for those goods or services. In doing so, companies may need to use more judgment and make more estimates than under current revenue recognition guidance. The ASU allows for the use of either the full or modified retrospective transition method, and the standard as written will be effective for us in the first quarter of our fiscal year 2018 unless a deferral for adoption is provided by the FASB; early adoption is not permitted. In April, 2015, the FASB issued a proposed ASU that would defer adoption of ASU 2014-09 by one year. If the proposed ASU is adopted, ASU 2014-9 will be effective for us in the first quarter of our fiscal year 2019. The Company is currently evaluating which transition approach to use and the impact of the adoption of this standard on its condensed consolidated financial statements. |
Discontinued_Operations_Tables
Discontinued Operations (Tables) | 9 Months Ended | ||||||||||||||||
Mar. 31, 2015 | |||||||||||||||||
Discontinued Operations and Disposal Groups [Abstract] | |||||||||||||||||
Schedule of Disposal Groups, Including Discontinued Operations, Income Statement, Balance Sheet and Additional Disclosures | Summarized results of the Company's discontinued operations are as follows: | ||||||||||||||||
THREE MONTHS ENDED | NINE MONTHS ENDED | ||||||||||||||||
March 31, | March 31, | ||||||||||||||||
2015 | 2014 | 2015 | 2014 | ||||||||||||||
(In thousands) | (In thousands) | ||||||||||||||||
Revenue | $ | — | $ | 356 | $ | — | $ | 814 | |||||||||
Net income from discontinued operations | $ | — | $ | 27,593 | $ | — | $ | 24,937 | |||||||||
The Company recorded purchase price adjustments pursuant to the Sale Deed relating to the reimbursement of Dingo development costs and post completion costs. As of March 31, 2014, the gain related to the Company's discontinued operations is summarized as follows: | |||||||||||||||||
March 31, | |||||||||||||||||
2014 | |||||||||||||||||
(In thousands) | |||||||||||||||||
Assets and liabilities sold | |||||||||||||||||
Property and equipment, net | $ | (10,100 | ) | ||||||||||||||
Deferred income taxes | (7,217 | ) | |||||||||||||||
Goodwill allocated to disposal group | (1,000 | ) | |||||||||||||||
Asset retirement obligations | 4,457 | ||||||||||||||||
Other assets and liabilities, net | 1,178 | ||||||||||||||||
Total assets and liabilities of discontinued operations | (12,682 | ) | |||||||||||||||
Consideration | |||||||||||||||||
First cash installment - received on Central Closing Date | 13,859 | ||||||||||||||||
Second cash installment - received on April 15, 2014 | 4,624 | ||||||||||||||||
Stock of Central | 19,147 | ||||||||||||||||
Total consideration | 37,630 | ||||||||||||||||
Reclassification of foreign currency translation gains to earnings upon sale of foreign subsidiary | 6,049 | ||||||||||||||||
Transaction costs | (815 | ) | |||||||||||||||
Gain on disposal of discontinued operations, net of tax | $ | 30,182 | |||||||||||||||
Securities_AvailableforSale_Ta
Securities Available-for-Sale (Tables) | 9 Months Ended | |||||||||||||||
Mar. 31, 2015 | ||||||||||||||||
Investments, Debt and Equity Securities [Abstract] | ||||||||||||||||
Schedule of Available-for-sale Securities | The following table presents the amortized cost, gross unrealized gains, gross unrealized losses, and fair market value of available-for-sale equity securities, nearly all of which are attributable to the Company's investment in Central stock, as follows: | |||||||||||||||
March 31, 2015 | ||||||||||||||||
Amortized | Gross unrealized gains | Gross unrealized losses | Fair | |||||||||||||
cost | value | |||||||||||||||
(In thousands) | ||||||||||||||||
Equity securities | $ | 19,339 | $ | — | $ | (15,217 | ) | $ | 4,122 | |||||||
June 30, 2014 | ||||||||||||||||
Amortized | Gross unrealized gains | Gross unrealized losses | Fair | |||||||||||||
cost | value | |||||||||||||||
(In thousands) | ||||||||||||||||
Equity securities | $ | 19,339 | $ | — | $ | (7,404 | ) | $ | 11,935 | |||||||
Asset_Retirement_Obligations_T
Asset Retirement Obligations (Tables) | 9 Months Ended | |||
Mar. 31, 2015 | ||||
Asset Retirement Obligation Disclosure [Abstract] | ||||
Asset Retirement Obligations Roll-Forward | The following table summarizes the ARO activity for the nine months ended March 31, 2015: | |||
Total | ||||
(In thousands) | ||||
Fiscal year opening balance | $ | 2,873 | ||
Accretion expense | 130 | |||
Effect of exchange rate changes | (51 | ) | ||
Balance at March 31, 2015 | 2,952 | |||
Less current asset retirement obligation | 356 | |||
Long term asset retirement obligation | $ | 2,596 | ||
Fair_Value_Measurements_Tables
Fair Value Measurements (Tables) | 9 Months Ended | |||||||||||||||
Mar. 31, 2015 | ||||||||||||||||
Fair Value Disclosures [Abstract] | ||||||||||||||||
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis | The following table presents items required to be measured at fair value on a recurring basis by the level in which they are classified within the valuation hierarchy as follows: | |||||||||||||||
March 31, 2015 | ||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
(In thousands) | ||||||||||||||||
Assets: | ||||||||||||||||
Securities available-for-sale | $ | 4,122 | $ | — | $ | — | $ | 4,122 | ||||||||
June 30, 2014 | ||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
(In thousands) | ||||||||||||||||
Assets: | ||||||||||||||||
Securities available-for-sale | $ | 11,935 | $ | — | $ | — | $ | 11,935 | ||||||||
Liabilities: | ||||||||||||||||
Contingent consideration payable (1) | $ | — | $ | — | $ | 1,852 | $ | 1,852 | ||||||||
(1) See Note 15 - Commitments and Contingencies, below for additional information about this item. | ||||||||||||||||
Fair Value Inputs, Assets, Quantitative Information | The following table presents information about significant unobservable inputs to the Company's Level 3 financial liability measured at fair value on a recurring basis as follows: | |||||||||||||||
Description | Valuation technique | Significant unobservable inputs | March 31, | June 30, | ||||||||||||
2015 | 2014 | |||||||||||||||
Contingent consideration payable | Discounted cash flow model | Discount rate | N/A | 8.00% | ||||||||||||
First production payout | N/A | 30-Jun-15 | ||||||||||||||
Second production payout | N/A | N/A | ||||||||||||||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation | Adjustments to the fair value of the contingent consideration payable are recorded in the unaudited condensed consolidated statements of operations under other (expense) income. The following table presents a roll forward of the contingent consideration payable for the nine months ended March 31, 2015: | |||||||||||||||
Total | ||||||||||||||||
(In thousands) | ||||||||||||||||
Fiscal year opening balance | $ | 1,852 | ||||||||||||||
Accretion expense of contingent consideration payable | 36 | |||||||||||||||
Fair value revision of contingent consideration payable | (1,888 | ) | ||||||||||||||
Balance at March 31, 2015 | $ | — | ||||||||||||||
StockBased_Compensation_Tables
Stock-Based Compensation (Tables) | 9 Months Ended | |||||||||||||||||
Mar. 31, 2015 | ||||||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||||||||||||||||||
Stock Option Activity | The following table summarizes the stock option activity for the nine months ended March 31, 2015: | |||||||||||||||||
Number of | WAEPS (1) | |||||||||||||||||
Shares | ||||||||||||||||||
Fiscal year opening balance | 10,492,291 | $1.26 | ||||||||||||||||
Granted | 1,785,000 | $1.73 | ||||||||||||||||
Exercised | (494,791 | ) | $1.09 | |||||||||||||||
Forfeited/canceled | (2,882,085 | ) | $1.14 | |||||||||||||||
Expired | (25,000 | ) | $1.03 | |||||||||||||||
Balance at March 31, 2015 | 8,875,415 | $1.40 | ||||||||||||||||
Weighted average remaining contractual term | 5.97 | years | ||||||||||||||||
(1) Weighted average exercise price per share | ||||||||||||||||||
Weighted-Average Assumptions | The fair value of stock options granted under the 2012 Stock Incentive Plan was estimated using the following weighted-average assumptions for the nine months ended: | |||||||||||||||||
March 31, | ||||||||||||||||||
2015 | 2014 | |||||||||||||||||
TBOs | PBOs | MBOs | PBOs | MBOs | ||||||||||||||
Number of options | 135,000 | 1,250,000 | 400,000 | 1,500,000 | 1,500,000 | |||||||||||||
Weighted-average grant date fair value per share | $0.47 | $0.88 | $1.17 | $0.57 | $0.69 | |||||||||||||
Expected dividend yield | —% | —% | —% | —% | —% | |||||||||||||
Forfeiture rate | 22.60% | 15.00% | 15.00% | —% | —% | |||||||||||||
Risk free interest rate | 1.50% | 1.70% | 2.40% | 1.50% | - | 1.70% | 2.80% | |||||||||||
Expected life (years)(1) | 6 | 5.3 | - | 5.4 | 3.2 | - | 3.9 | 0.4 | - | 1.6 | 2.6 | |||||||
Expected volatility (based on historical price) | 57% | 54% | 64% | 62% | 67% | |||||||||||||
(1) Expected life assumed to be the midpoint between vesting and contractual expiry. |
Preferred_Stock_Tables
Preferred Stock (Tables) | 9 Months Ended | |||||||||||||
Mar. 31, 2015 | ||||||||||||||
Equity [Abstract] | ||||||||||||||
Schedule of Preferred Stock Activity | The activity related to the Series A Preferred Stock for the nine months ended March 31, 2015, and the fiscal year ended June 30, 2014, is as follows: | |||||||||||||
NINE MONTHS ENDED | FISCAL YEAR ENDED | |||||||||||||
March 31, 2015 | June 30, 2014 | |||||||||||||
Number of shares | Amount | Number of shares | Amount | |||||||||||
(In thousands, except share amounts) | ||||||||||||||
Fiscal year opening balance | 20,089,436 | $ | 24,539 | 19,239,734 | $ | 23,502 | ||||||||
PIK dividend shares issued for previously accrued dividend | — | — | 164,607 | 202 | ||||||||||
Current year PIK dividend shares issued | 709,283 | 867 | 685,095 | 835 | ||||||||||
Balance at end of period | 20,798,719 | $ | 25,406 | 20,089,436 | $ | 24,539 | ||||||||
Stockholders_Equity_Tables
Stockholders' Equity (Tables) | 9 Months Ended | |||||||||||||
Mar. 31, 2015 | ||||||||||||||
Equity [Abstract] | ||||||||||||||
Treasury Stock Activity | The following table summarizes the Company's treasury stock activity as follows: | |||||||||||||
NINE MONTHS ENDED | FISCAL YEAR ENDED | |||||||||||||
March 31, 2015 | June 30, 2014 | |||||||||||||
Number of shares | Amount | Number of shares | Amount | |||||||||||
(In thousands, except share amounts) | ||||||||||||||
Fiscal year opening balance | 9,425,114 | $ | 9,344 | 9,414,176 | $ | 9,333 | ||||||||
Shares repurchased from former executive | 250,000 | 462 | — | — | ||||||||||
Net shares repurchased for employee tax and option exercise price obligations related to the vesting of restricted stock and the exercise of employee stock options | 47,920 | 104 | 10,938 | 11 | ||||||||||
Cancellation of shares repurchased | (47,920 | ) | (104 | ) | — | — | ||||||||
Balance at end of period | 9,675,114 | $ | 9,806 | 9,425,114 | $ | 9,344 | ||||||||
Loss_Income_Per_Common_Share_T
(Loss) Income Per Common Share (Tables) | 9 Months Ended | |||||||||||||||
Mar. 31, 2015 | ||||||||||||||||
Earnings Per Share [Abstract] | ||||||||||||||||
Schedule of Earnings Per Share, Basic and Diluted | The following table summarizes the computation of basic and diluted earnings per share: | |||||||||||||||
THREE MONTHS ENDED | NINE MONTHS ENDED | |||||||||||||||
March 31, | March 31, | |||||||||||||||
2015 | 2014 | 2015 | 2014 | |||||||||||||
(In thousands, except share and per share amounts) | ||||||||||||||||
Loss from continuing operations, net of tax | $ | (2,280 | ) | $ | (3,072 | ) | $ | (7,793 | ) | $ | (9,364 | ) | ||||
Preferred stock dividend | (437 | ) | (432 | ) | (1,296 | ) | (1,267 | ) | ||||||||
Net loss from continuing operations, including preferred stock dividends | (2,717 | ) | (3,504 | ) | (9,089 | ) | (10,631 | ) | ||||||||
Net income from discontinued operations | — | 27,593 | — | 24,937 | ||||||||||||
Net loss attributable to non-controlling interest in subsidiary | 165 | — | 335 | — | ||||||||||||
Net (loss) income attributable to common stockholders | $ | (2,552 | ) | $ | 24,089 | $ | (8,754 | ) | $ | 14,306 | ||||||
Basic weighted average shares outstanding | 45,701,107 | 45,348,709 | 45,677,673 | 45,348,753 | ||||||||||||
Add: dilutive effects of in-the-money stock options and non-vested restricted stock grants (1) | — | — | — | — | ||||||||||||
Diluted weighted average common shares outstanding | 45,701,107 | 45,348,709 | 45,677,673 | 45,348,753 | ||||||||||||
Basic loss per common share: | ||||||||||||||||
Net loss from continuing operations attributable to Magellan Petroleum Corporation, including preferred stock dividends | ($0.06) | ($0.08) | ($0.19) | ($0.23) | ||||||||||||
Net income from discontinued operations | $0.00 | $0.61 | $0.00 | $0.55 | ||||||||||||
Net (loss) income attributable to common stockholders | ($0.06) | $0.53 | ($0.19) | $0.32 | ||||||||||||
Diluted loss per common share: | ||||||||||||||||
Net loss from continuing operations attributable to Magellan Petroleum Corporation, including preferred stock dividends | ($0.06) | ($0.08) | ($0.19) | ($0.23) | ||||||||||||
Net income from discontinued operations | $0.00 | $0.61 | $0.00 | $0.55 | ||||||||||||
Net (loss) income attributable to common stockholders | ($0.06) | $0.53 | ($0.19) | $0.32 | ||||||||||||
(1) All diluted earnings per share calculations are dictated by results from continuing operations; accordingly, there were no dilutive effects on earnings per share in the periods presented since all such periods had a net loss from continuing operations. | ||||||||||||||||
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | Potentially dilutive securities excluded from the calculation of diluted shares outstanding in periods with net losses are as follows: | |||||||||||||||
THREE MONTHS ENDED | NINE MONTHS ENDED | |||||||||||||||
March 31, | March 31, | |||||||||||||||
2015 | 2014 | 2015 | 2014 | |||||||||||||
In-the-money stock options | — | 5,143,666 | 7,776,666 | 907,500 | ||||||||||||
Non-vested restricted stock | 350,000 | 450,000 | 350,000 | 450,000 | ||||||||||||
Convertible preferred stock | 20,798,719 | 20,089,436 | 20,798,719 | 20,089,436 | ||||||||||||
Total | 21,148,719 | 25,683,102 | 28,925,385 | 21,446,936 | ||||||||||||
Segment_Information_Tables
Segment Information (Tables) | 9 Months Ended | |||||||||||||||
Mar. 31, 2015 | ||||||||||||||||
Segment Reporting [Abstract] | ||||||||||||||||
Schedule of Segment Reporting Information, by Segment | The Company conducts its operations through three wholly owned subsidiaries: NP, which operates in the US; MPUK, which includes our operations in the UK; and MPA, which includes our operations in Australia. Oversight for these subsidiaries is provided by Corporate, which is treated as a cost center. | |||||||||||||||
THREE MONTHS ENDED | NINE MONTHS ENDED | |||||||||||||||
March 31, | March 31, | |||||||||||||||
2015 | 2014 | 2015 | 2014 | |||||||||||||
(In thousands) | ||||||||||||||||
Revenue from oil production: | ||||||||||||||||
NP | $ | 688 | $ | 1,907 | $ | 3,543 | $ | 5,674 | ||||||||
Net (loss) income from continuing operations: | ||||||||||||||||
NP | $ | 481 | $ | 40 | $ | (63 | ) | $ | (536 | ) | ||||||
MPUK | (300 | ) | (1,349 | ) | (881 | ) | (2,495 | ) | ||||||||
MPA | (402 | ) | — | (1,159 | ) | — | ||||||||||
Corporate | (2,059 | ) | (1,949 | ) | (5,690 | ) | (6,700 | ) | ||||||||
Inter-segment elimination | — | 186 | — | 367 | ||||||||||||
Consolidated net loss from continuing operations | $ | (2,280 | ) | $ | (3,072 | ) | $ | (7,793 | ) | $ | (9,364 | ) | ||||
March 31, | June 30, | |||||||||||||||
2015 | 2014 | |||||||||||||||
(In thousands) | ||||||||||||||||
Total assets: | ||||||||||||||||
NP (1) | $ | 29,997 | $ | 27,299 | ||||||||||||
MPUK (1) | 3,102 | 4,486 | ||||||||||||||
MPA (1) | 4,819 | 14,073 | ||||||||||||||
Corporate | 105,490 | 111,113 | ||||||||||||||
Inter-segment elimination (2) | (77,249 | ) | (75,536 | ) | ||||||||||||
Total assets of continuing operations | $ | 66,159 | $ | 81,435 | ||||||||||||
(1) Intercompany payable balances netted in arriving at segment assets | ||||||||||||||||
(2) Asset inter-segment eliminations are primarily derived from investments in subsidiaries. |
Oil_and_Gas_Activities_Tables
Oil and Gas Activities (Tables) | 9 Months Ended | |||||||
Mar. 31, 2015 | ||||||||
Oil and Gas Exploration and Production Industries Disclosures [Abstract] | ||||||||
Cost Incurred in Oil and Gas Property Acquisition, Exploration, and Development Activities Disclosure | The following table presents the capitalized costs under the successful efforts method for oil and gas properties as of: | |||||||
March 31, | June 30, | |||||||
2015 | 2014 | |||||||
(In thousands) | ||||||||
Proved oil and gas properties: | ||||||||
United States | $ | 29,850 | $ | 29,335 | ||||
Less accumulated depletion, depreciation, and amortization | (4,056 | ) | (3,575 | ) | ||||
Total net proved oil and gas properties | $ | 25,794 | $ | 25,760 | ||||
Unproved oil and gas properties: | ||||||||
United States | $ | 468 | $ | 268 | ||||
United Kingdom | 227 | 282 | ||||||
Australia | — | — | ||||||
Total unproved oil and gas properties | $ | 695 | $ | 550 | ||||
Wells in Progress: | ||||||||
United States | $ | 25,769 | $ | 19,686 | ||||
United Kingdom | 1,695 | 1,610 | ||||||
Total wells in progress | $ | 27,464 | $ | 21,296 | ||||
Basis_of_Presentation_Details
Basis of Presentation (Details) (USD $) | 3 Months Ended | 9 Months Ended | |
Mar. 31, 2015 | Mar. 31, 2015 | Mar. 31, 2014 | |
segment | |||
Schedule of Equity Method Investments [Line Items] | |||
Impairment on AFS securities | $168,000 | $168,000 | $0 |
Number of reportable segments | 3 | ||
Utah CO2 LLC | |||
Schedule of Equity Method Investments [Line Items] | |||
Majority interest percentage | 51.00% | 51.00% | |
Central Petroleum Limited | |||
Schedule of Equity Method Investments [Line Items] | |||
Ownership percentage | 11.00% | 11.00% | |
Two separate third parties | Utah CO2 LLC | |||
Schedule of Equity Method Investments [Line Items] | |||
Ownership percentage | 49.00% | 49.00% |
Sale_of_Amadeus_Basin_Assets_D
Sale of Amadeus Basin Assets (Details) | 9 Months Ended | 0 Months Ended | 9 Months Ended | 9 Months Ended | 0 Months Ended | |||
Mar. 31, 2015 | Mar. 31, 2014 | Mar. 31, 2015 | Mar. 31, 2014 | Mar. 31, 2015 | Mar. 31, 2015 | Mar. 31, 2015 | Mar. 31, 2014 | |
USD ($) | USD ($) | Central Petroleum Limited | Amadeus Basin | Amadeus Basin | Amadeus Basin | Amadeus Basin | Amadeus Basin | |
AUD | Maximum | Palm Valley | Central Petroleum Limited | |||||
AUD | ||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||||
Amount paid in exchange for assets | $0 | $13,859,000 | 20,000,000 | |||||
Customary purchase price adjustments | 800,000 | |||||||
Shares issued during period for acquisitions | 39,500,000 | |||||||
Ownership percentage | 11.00% | |||||||
Royalty rate | 25.00% | |||||||
AUD/Gigajoule gas price trigger for first ten years | 5 | |||||||
AUD/Gigajoule gas price trigger for following five years | 6 | |||||||
Discount rate | 10.00% | |||||||
Bonus discharge amount | 7,000,000 |
Discontinued_Operations_Detail
Discontinued Operations (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 | Mar. 31, 2015 | Mar. 31, 2014 |
Disposal Group, Including Discontinued Operation, Income Statement Disclosures [Abstract] | ||||
Revenue | $0 | $356 | $0 | $814 |
Net income from discontinued operations | $0 | $27,593 | $0 | $24,937 |
Discontinued_Operations_Assets
Discontinued Operations (Assets and Liabilities) (Details) (USD $) | 3 Months Ended | 9 Months Ended | |||
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 | Mar. 31, 2015 | Mar. 31, 2014 | Apr. 15, 2014 |
Consideration | |||||
Reclassification of foreign currency translation gains to earnings upon sale of foreign subsidiary | $0 | $6,049 | $0 | $6,049 | |
Gain on disposal of discontinued operations, net of tax | 0 | 30,182 | 0 | 30,182 | |
Sale Deed | |||||
Assets and liabilities sold | |||||
Property and equipment, net | -10,100 | -10,100 | |||
Deferred income taxes | -7,217 | -7,217 | |||
Goodwill allocated to disposal group | -1,000 | -1,000 | |||
Asset retirement obligations | 4,457 | 4,457 | |||
Other assets and liabilities, net | 1,178 | 1,178 | |||
Total assets and liabilities of discontinued operations | -12,682 | -12,682 | |||
Consideration | |||||
Cash consideration | 13,859 | 13,859 | 4,624 | ||
Stock of Central | 19,147 | 19,147 | |||
Total consideration | 37,630 | 37,630 | |||
Reclassification of foreign currency translation gains to earnings upon sale of foreign subsidiary | 6,049 | ||||
Transaction costs | -815 | ||||
Gain on disposal of discontinued operations, net of tax | $30,182 |
Securities_AvailableforSale_De
Securities Available-for-Sale (Details) (USD $) | 3 Months Ended | 9 Months Ended | 0 Months Ended | ||
Mar. 31, 2015 | Mar. 31, 2015 | Mar. 31, 2014 | Apr. 01, 2015 | Jun. 30, 2014 | |
Schedule of Available-for-sale Securities [Line Items] | |||||
Amortized cost | $19,339,000 | $19,339,000 | $19,339,000 | ||
Gross unrealized gains | 0 | 0 | 0 | ||
Gross unrealized losses | -15,217,000 | -15,217,000 | -7,404,000 | ||
Fair value | 4,122,000 | 4,122,000 | 11,935,000 | ||
Impairment on AFS securities | 168,000 | 168,000 | 0 | ||
Subsequent Event | |||||
Schedule of Available-for-sale Securities [Line Items] | |||||
Amortized cost | 192,000 | ||||
Proceeds from sale of investments in common stock of offshore exploration company | $24,000 |
Debt_Details
Debt (Details) (USD $) | 0 Months Ended | |||
Sep. 17, 2014 | Mar. 31, 2015 | 13-May-15 | Jan. 31, 2011 | |
West Texas State Bank | Revolving Credit Facility | ||||
Debt Instrument [Line Items] | ||||
Maximum borrowing capacity | 8,000,000 | |||
Remaining borrowing capacity | 4,499,000 | |||
Outstanding balance on line of credit | 3,501,000 | |||
West Texas State Bank | Prime Rate | Revolving Credit Facility | ||||
Debt Instrument [Line Items] | ||||
Interest rate | 3.25% | |||
West Texas State Bank | Floor Rate | Revolving Credit Facility | ||||
Debt Instrument [Line Items] | ||||
Interest rate | 3.25% | |||
West Texas State Bank | Subsequent Event | Revolving Credit Facility | ||||
Debt Instrument [Line Items] | ||||
Outstanding balance on line of credit | 5,500,000 | |||
Notes Payable | Note Payable Due June 2014 | ||||
Debt Instrument [Line Items] | ||||
Outstanding principal | $1,700,000 |
Asset_Retirement_Obligations_D
Asset Retirement Obligations (Details) (USD $) | 9 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2015 | Jun. 30, 2014 |
Asset Retirement Obligation, Roll Forward Analysis [Roll Forward] | ||
Fiscal year opening balance | $2,873 | |
Accretion expense | 130 | |
Effect of exchange rate changes | -51 | |
Ending balance | 2,952 | |
Less current asset retirement obligation | 356 | 397 |
Long term asset retirement obligation | $2,596 | $2,476 |
Asset_Retirement_Obligations_A
Asset Retirement Obligations - Additional Information (Details) (USD $) | 3 Months Ended | ||
In Thousands, unless otherwise specified | Mar. 31, 2015 | Jun. 30, 2014 | Apr. 30, 2015 |
Other Commitments [Line Items] | |||
Current portion of asset retirement obligations | $356 | $397 | |
Markwells Wood-1 | |||
Other Commitments [Line Items] | |||
Current portion of asset retirement obligations | 346 | ||
Costs related to MW-1 included in wells in progress | $296 | ||
Subsequent Event | Markwells Wood-1 | |||
Other Commitments [Line Items] | |||
Interest sold | 40.00% |
Fair_Value_Measurements_Assets
Fair Value Measurements (Assets and Liabilities Carried at Fair Value by Classification Level in Valuation Hierarchy) (Details) (USD $) | Mar. 31, 2015 | Jun. 30, 2014 |
In Thousands, unless otherwise specified | ||
Assets: | ||
Securities available-for-sale | $4,122 | $11,935 |
Recurring | ||
Assets: | ||
Securities available-for-sale | 4,122 | 11,935 |
Assets | ||
Recurring | Level 1 | ||
Assets: | ||
Securities available-for-sale | 4,122 | 11,935 |
Assets | ||
Liabilities: | ||
Contingent consideration payable | 0 | |
Recurring | Level 2 | ||
Assets: | ||
Securities available-for-sale | 0 | 0 |
Assets | ||
Liabilities: | ||
Contingent consideration payable | 0 | |
Recurring | Level 3 | ||
Assets: | ||
Securities available-for-sale | 0 | 0 |
Assets | ||
Liabilities: | ||
Contingent consideration payable | $1,852 |
Fair_Value_Measurements_Signif
Fair Value Measurements (Significant Unobservable Inputs to Level 3) (Details) | 9 Months Ended | 12 Months Ended |
Mar. 31, 2015 | Jun. 30, 2014 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Rolling gross production average | 60 days | |
Discounted cash flow model | Contingent consideration payable | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Discount rate | 8.00% |
Fair_Value_Measurements_Unobse
Fair Value Measurements (Unobservable Input Reconciliation) (Details) (USD $) | 9 Months Ended | ||
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 | Jun. 30, 2014 |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Fiscal year opening balance | $1,852 | ||
Accretion expense of contingent consideration payable | -36 | -234 | |
Fair value revision of contingent consideration payable | -1,888 | 0 | |
Ending balance | 0 | ||
Recurring | Level 3 | |||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Business Combination, Contingent Consideration, Liability | 1,852 | ||
Accretion expense of contingent consideration payable | -36 | ||
Fair value revision of contingent consideration payable | -1,888 | ||
Ending balance | $0 |
Income_Taxes_Details
Income Taxes (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 | Mar. 31, 2015 | Mar. 31, 2014 |
Income Tax Contingency [Line Items] | ||||
Effective tax rate | 0.00% | 0.00% | ||
Deferred tax assets | $3,580 | $3,580 | ||
Basis difference in foreign subsidiaries | 9,308 | 9,308 | ||
Income tax expense | 43 | 0 | 43 | 0 |
Montana | State | ||||
Income Tax Contingency [Line Items] | ||||
Income tax expense | $43 | $43 |
StockBased_Compensation_Detail
Stock-Based Compensation (Details) (USD $) | 0 Months Ended | 9 Months Ended | 1 Months Ended | 0 Months Ended | ||||||
In Thousands, except Share data, unless otherwise specified | Aug. 15, 2014 | Mar. 31, 2015 | Mar. 31, 2014 | Oct. 31, 2014 | Oct. 31, 2013 | Oct. 17, 2014 | Oct. 10, 2014 | Jul. 01, 2014 | Jan. 16, 2013 | Jan. 15, 2013 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Number of stock options exercised | 494,791 | 0 | ||||||||
Issuance of common stock (in shares) | 272,898 | |||||||||
Number of stock options forfeited/canceled | 2,882,085 | 41,666 | ||||||||
Value of stock repurchased | $1,445 | |||||||||
Repurchase of common stock | 566 | 11 | ||||||||
Stock issued, in shares | 1,785,000 | |||||||||
Expired (in shares) | 25,000 | 0 | ||||||||
Unvested options forfeited | 1,369,585 | |||||||||
Exercise price of options (in dollars per share) | $1.73 | |||||||||
TBOs | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Stock issued, in shares | 135,000 | |||||||||
Restricted Stock | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Share-based compensation expense (reversal of expense) | -44 | |||||||||
PBOs | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Stock issued, in shares | 1,250,000 | 1,500,000 | ||||||||
PBOs | CO2-EOR Development Project at Poplar | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Performance metrics weighted average | 20.00% | 40.00% | ||||||||
PBOs | Preparing Poplar of commercially viable CO2-EOR Development | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Performance metrics weighted average | 40.00% | |||||||||
PBOs | Progressing UK operations in the Weald Basin | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Performance metrics weighted average | 20.00% | |||||||||
PBOs | Moving forward with Farnham Dome Project | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Performance metrics weighted average | 20.00% | |||||||||
PBOs | CO2-EOR Pilot Program at Poplar | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Performance metrics weighted average | 10.00% | |||||||||
PBOs | Sale of Substantially All of the Amadeus Basin Assets | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Performance metrics weighted average | 20.00% | |||||||||
PBOs | Approval of a Farmout Agreement or Participation in Drilling a Well in the Weald Basin | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Performance metrics weighted average | 20.00% | |||||||||
PBOs | Approval of a Farmout Agreement in the Bonaparte Basin | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Performance metrics weighted average | 10.00% | |||||||||
Employee Stock Option | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Share-based compensation expense (reversal of expense) | -430 | |||||||||
Unrecorded expected future compensation expense related to stock option awards | 1,424 | 1,500 | ||||||||
RSUs | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Unvested RSUs forfeited | 100,000 | |||||||||
Market Based Options | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Per share closing price (in dollars per share) | $2.35 | |||||||||
Number of consecutive trading days | 10 | |||||||||
Stock issued, in shares | 400,000 | 1,500,000 | ||||||||
Employee Stock Option | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Maximum number of shares allowed to be issued each year | 1,000,000 | |||||||||
RSUs | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Maximum number of shares allowed to be issued each year | 500,000 | |||||||||
2012 Stock Incentive Plan | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Number of shares authorized | 5,000,000 | |||||||||
Expiration term | 10 years | |||||||||
2012 Stock Incentive Plan | TBOs | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Stock issued, in shares | 135,000 | |||||||||
2012 Stock Incentive Plan | PBOs | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Stock issued, in shares | 1,250,000 | 1,500,000 | ||||||||
2012 Stock Incentive Plan | Market Based Options | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Per share closing price (in dollars per share) | 5 | |||||||||
Number of consecutive trading days | 10 | 90 | ||||||||
Median stock price (in dollars per share) | $2.35 | 5 | ||||||||
Median stock price, maintenance period | 90 days | |||||||||
Stock issued, in shares | 400,000 | 1,500,000 | ||||||||
Vesting period | 3 years | |||||||||
1998 Stock Incentive Plan | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Number of shares authorized | 288,435 | |||||||||
Nonvested options outstanding (in shares) | 3,131,250 | |||||||||
1998 Stock Incentive Plan | Employee Stock Option | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Market based and performance based shares available for future issuance | 658,698 | |||||||||
2015 Incentive Compensation Program | Restricted Stock | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Share-based compensation expense (reversal of expense) | 57 | |||||||||
Former executive | 1998 Stock Incentive Plan | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Number of stock options forfeited/canceled | 1,512,500 | |||||||||
Value of stock repurchased | 1,400 | |||||||||
Repurchase of common stock | 983 | 462 | ||||||||
Former executive officer ownership, percent, more than | 5.00% | |||||||||
Amount of withholding taxes | 318 | |||||||||
Shares repurchased during period | 1,512,500 | 250,000 | ||||||||
Former executive | 1998 Stock Incentive Plan | Employee Stock Option | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Shares repurchased during period | 1,512,500 | |||||||||
Non-employee Directors | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Number of stock options exercised | 21,875 | |||||||||
Share-based compensation expense (reversal of expense) | 256 | |||||||||
Non-employee Directors | Common Stock | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Grants in period | 96,330 | |||||||||
Executives | 2015 Incentive Compensation Program | Restricted Stock | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Grants in period | 100,000 | |||||||||
Chairman of the Board | 2015 Incentive Compensation Program | Restricted Stock | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Grants in period | 50,000 | |||||||||
Selling, General and Administrative Expense | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Share-based compensation expense (reversal of expense) | 841 | 1,667 | ||||||||
Selling, General and Administrative Expense | Prior Period Awards | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Share-based compensation expense (reversal of expense) | 441 | |||||||||
Selling, General and Administrative Expense | Employee Stock Option | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Share-based compensation expense (reversal of expense) | $561 |
StockBased_Compensation_Stock_
Stock-Based Compensation (Stock Option Activity) (Details) (USD $) | 9 Months Ended | |
Mar. 31, 2015 | Mar. 31, 2014 | |
Number of Shares | ||
Balance at beginning of year (in shares) | 10,492,291 | |
Granted (in shares) | 1,785,000 | |
Exercised (in shares) | -494,791 | 0 |
Forfeited/canceled (in shares) | -2,882,085 | -41,666 |
Expired (in shares) | -25,000 | 0 |
Options outstanding at year end (in shares) | 8,875,415 | |
Weighted average remaining contractual term | 5 years 11 months 19 days | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Roll Forward] | ||
Weighted Average Exercise Price per Share, Balance at beginning of year (in dollars per share) | $1.26 | |
Weighted Average Exercise Price per Share, Granted (in dollars per share) | $1.73 | |
Weighted Average Exercise Price per Share, Exercised (in dollars per share) | $1.09 | |
Weighted Average Exercise Price Per Share, Forfeited (in dollars per share) | $1.14 | |
Weighted Average Exercise Price Per Share, Expired (in dollars per share) | $1.03 | |
Weighted Average Exercise Price per Share, Options outstanding at year end (in dollars per share) | $1.40 |
StockBased_Compensation_Weight
Stock-Based Compensation (Weighted Average Assumptions) (Details) (USD $) | 9 Months Ended | |
Mar. 31, 2015 | Mar. 31, 2014 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of options | 1,785,000 | |
TBOs | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of options | 135,000 | |
Weighted-average grant date fair value per share | $0.47 | |
Expected dividend yield | 0.00% | |
Forfeiture rate | 22.60% | |
Risk free interest rate | 1.50% | |
Expected life (years) | 6 years | |
Expected volatility (based on historical price) | 57.00% | |
PBOs | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of options | 1,250,000 | 1,500,000 |
Weighted-average grant date fair value per share | $0.88 | $0.57 |
Expected dividend yield | 0.00% | 0.00% |
Forfeiture rate | 15.00% | 0.00% |
Risk free interest rate | 1.70% | |
PBOs | Minimum | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Risk free interest rate | 1.50% | |
Expected life (years) | 5 years 3 months 18 days | 4 months 24 days |
Expected volatility (based on historical price) | 54.00% | 62.00% |
PBOs | Maximum | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Risk free interest rate | 1.70% | |
Expected life (years) | 5 years 4 months 24 days | 1 year 7 months 6 days |
Market Based | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of options | 400,000 | 1,500,000 |
Weighted-average grant date fair value per share | $1.17 | $0.69 |
Expected dividend yield | 0.00% | 0.00% |
Forfeiture rate | 15.00% | 0.00% |
Risk free interest rate | 2.40% | 2.80% |
Expected life (years) | 2 years 7 months 6 days | |
Expected volatility (based on historical price) | 64.00% | 67.00% |
Market Based | Minimum | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Expected life (years) | 3 years 2 months 12 days | |
Market Based | Maximum | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Expected life (years) | 3 years 10 months 24 days |
Preferred_Stock_Details
Preferred Stock (Details) (USD $) | 0 Months Ended | 9 Months Ended | 12 Months Ended | ||
In Thousands, except Share data, unless otherwise specified | 10-May-13 | Mar. 31, 2015 | Mar. 31, 2014 | Jun. 30, 2014 | 10-May-13 |
Class of Stock [Line Items] | |||||
Preferred stock dividend | $1,296 | ||||
Preferred stock dividends paid in kind | 867 | 1,038 | |||
Series A Preferred Stock | |||||
Class of Stock [Line Items] | |||||
Issuance of Series A Preferred Stock | 19,239,734 | ||||
Preferred stock, par value (in dollars per share) | $0.01 | $0.01 | |||
Purchase price (in dollars per share) | $1.22 | $1.22 | |||
Shares issued upon conversion | 1 | 1 | |||
Proceeds fro issuance of preferred stock | 23,501 | ||||
Preferred stock dividend | 1,296 | 1,267 | |||
Preferred stock dividends paid in kind | $867 | $835 |
Preferred_Stock_RollForward_De
Preferred Stock (Roll-Forward) (Details) (USD $) | 9 Months Ended | 12 Months Ended | |
In Thousands, except Share data, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 | Jun. 30, 2014 |
Amount | |||
Fiscal year opening balance | $24,539 | ||
Current year PIK dividend shares issued | 867 | 1,038 | |
Balance at end of period | 25,406 | ||
Series A Preferred Stock | |||
Number of shares | |||
Fiscal year opening balance | 20,089,436 | 19,239,734 | 19,239,734 |
PIK dividend shares issued for previously accrued dividend | 0 | 164,607 | |
Current year PIK dividend shares issued | 709,283 | 685,095 | |
Balance at end of period | 20,798,719 | 20,089,436 | |
Amount | |||
Fiscal year opening balance | 24,539 | 23,502 | 23,502 |
PIK dividend shares issued for previously accrued dividend | 0 | 202 | |
Current year PIK dividend shares issued | 867 | 835 | |
Balance at end of period | $24,539 |
Stockholders_Equity_Details
Stockholders' Equity (Details) (USD $) | 9 Months Ended | 12 Months Ended | 0 Months Ended | |
In Thousands, except Share data, unless otherwise specified | Mar. 31, 2015 | Jun. 30, 2014 | Jul. 01, 2014 | Oct. 10, 2014 |
Treasury Stock [Roll Forward] | ||||
Fiscal year opening balance (in shares) | 9,425,114 | 9,414,176 | 9,425,114 | |
Shares repurchased from former executive (in shares) | 250,000 | |||
Net shares repurchased for employee tax and option exercise price obligations related to the vesting of restricted stock and the exercise of employee stock options (in shares) | 47,920 | 10,938 | ||
Cancellation of shares repurchased (in shares) | -47,920 | 0 | ||
Balance at end of period (in shares) | 9,675,114 | 9,425,114 | ||
Fiscal year opening balance | $9,344 | $9,333 | 9,344 | |
Shares repurchased from former executive | 462 | |||
Net shares repurchased for employee tax and option exercise price obligations related to the vesting of restricted stock and the exercise of employee stock options | 104 | 11 | ||
Cancellation of shares repurchased | -104 | 0 | ||
Balance at end of period | $9,806 | $9,344 | ||
Restricted Stock | ||||
Class of Stock [Line Items] | ||||
Vested restricted stock award (in shares) | 150,000 | |||
Treasury Stock [Roll Forward] | ||||
Net shares repurchased for employee tax and option exercise price obligations related to the vesting of restricted stock and the exercise of employee stock options (in shares) | 47,920 | |||
Former Company Executive | ||||
Class of Stock [Line Items] | ||||
Shares of common stock repurchased from individual retirement account | 250,000 |
Loss_Income_Per_Common_Share_D
(Loss) Income Per Common Share (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, except Share data, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 | Mar. 31, 2015 | Mar. 31, 2014 |
Earnings Per Share [Abstract] | ||||
Loss from continuing operations, net of tax | ($2,280) | ($3,072) | ($7,793) | ($9,364) |
Preferred stock dividends | -437 | -432 | -1,296 | -1,267 |
Net loss from continuing operations, including preferred stock dividends | -2,717 | -3,504 | -9,089 | -10,631 |
Net income from discontinued operations | 0 | 27,593 | 0 | 24,937 |
Net loss attributable to non-controlling interest in subsidiary | -165 | 0 | -335 | 0 |
Net (loss) income attributable to common stockholders | ($2,552) | $24,089 | ($8,754) | $14,306 |
Basic weighted average shares outstanding | 45,701,107 | 45,348,709 | 45,677,673 | 45,348,753 |
Add: dilutive effects of in-the-money stock options and non-vested restricted stock grants (1) | 0 | 0 | 0 | 0 |
Diluted weighted average common shares outstanding | 45,701,107 | 45,348,709 | 45,677,673 | 45,348,753 |
Basic loss per common share: | ||||
Net Loss from continuing operations attributable to Magellan Petroleum Corporation (in dollars per share) | ($0.06) | ($0.08) | ($0.19) | ($0.23) |
Net income (loss) from discontinued operations (in dollars per share) | $0 | $0.61 | $0 | $0.55 |
Net income (loss) attributable to common stockholders (in dollars per share) | ($0.06) | $0.53 | ($0.19) | $0.32 |
Diluted loss per common share: | ||||
Net Loss from continuing operations attributable to Magellan Petroleum Corporation (in dollars per share) | ($0.06) | ($0.08) | ($0.19) | ($0.23) |
Net income (loss) from discontinued operations (in dollars per share) | $0 | $0.61 | $0 | $0.55 |
Net income (loss) attributable to common stockholders (in dollars per share) | ($0.06) | $0.53 | ($0.19) | $0.32 |
Loss_Income_Per_Common_Share_S
(Loss) Income Per Common Share (Schedule of Antidilutive Securities) (Details) | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2015 | Mar. 31, 2014 | Mar. 31, 2015 | Mar. 31, 2014 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Potentially dilutive securities | 21,148,719 | 25,683,102 | 28,925,385 | 21,446,936 |
Stock options | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Potentially dilutive securities | 0 | 5,143,666 | 7,776,666 | 907,500 |
Restricted Stock | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Potentially dilutive securities | 350,000 | 450,000 | 350,000 | 450,000 |
Convertible Preferred Stock | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Potentially dilutive securities | 20,798,719 | 20,089,436 | 20,798,719 | 20,089,436 |
Segment_Information_Details
Segment Information (Details) (USD $) | 3 Months Ended | 9 Months Ended | |||
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 | Mar. 31, 2015 | Mar. 31, 2014 | Jun. 30, 2014 |
segment | |||||
Segment Reporting Information [Line Items] | |||||
Number of reportable segments | 3 | ||||
Loss from continuing operations | ($2,237) | ($3,072) | ($7,750) | ($9,364) | |
Consolidated net loss from continuing operations | -2,280 | -3,072 | -7,793 | -9,364 | |
Total assets | 66,159 | 66,159 | 81,435 | ||
Nautilus Poplar, LLC (NP) | |||||
Segment Reporting Information [Line Items] | |||||
Revenue from oil production | 688 | 1,907 | 3,543 | 5,674 | |
Loss from continuing operations | 481 | 40 | -63 | -536 | |
Total assets | 29,997 | 29,997 | 27,299 | ||
Magellan Petroleum UK (MPUK) | |||||
Segment Reporting Information [Line Items] | |||||
Loss from continuing operations | -300 | -1,349 | -881 | -2,495 | |
Total assets | 3,102 | 3,102 | 4,486 | ||
Magellan Petroleum Australia (MPA) | |||||
Segment Reporting Information [Line Items] | |||||
Loss from continuing operations | -402 | 0 | -1,159 | 0 | |
Total assets | 4,819 | 4,819 | 14,073 | ||
Corporate | |||||
Segment Reporting Information [Line Items] | |||||
Loss from continuing operations | -2,059 | -1,949 | -5,690 | -6,700 | |
Total assets | 105,490 | 105,490 | 111,113 | ||
Inter-segment Elimination | |||||
Segment Reporting Information [Line Items] | |||||
Loss from continuing operations | 0 | 186 | 0 | 367 | |
Total assets | ($77,249) | ($77,249) | ($75,536) |
Oil_and_Gas_Activities_Details
Oil and Gas Activities (Details) (USD $) | 3 Months Ended | 9 Months Ended | |||
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 | Mar. 31, 2015 | Mar. 31, 2014 | Jun. 30, 2014 |
Costs Incurred, Oil and Gas Property Acquisition, Exploration, and Development Activities [Line Items] | |||||
Proved oil and gas properties | $29,850 | $29,850 | $29,335 | ||
Unproved oil and gas properties | 695 | 695 | 550 | ||
Wells in progress | 27,464 | 27,464 | 21,296 | ||
Loss from continuing operations, net of tax | -2,280 | -3,072 | -7,793 | -9,364 | |
United States | |||||
Costs Incurred, Oil and Gas Property Acquisition, Exploration, and Development Activities [Line Items] | |||||
Proved oil and gas properties | 29,850 | 29,850 | 29,335 | ||
Less accumulated depletion, depreciation, amortization, and accretion | -4,056 | -4,056 | -3,575 | ||
Total net proved oil and gas properties | 25,794 | 25,794 | 25,760 | ||
Unproved oil and gas properties | 468 | 468 | 268 | ||
Wells in progress | 25,769 | 25,769 | 19,686 | ||
United Kingdom | |||||
Costs Incurred, Oil and Gas Property Acquisition, Exploration, and Development Activities [Line Items] | |||||
Unproved oil and gas properties | 227 | 227 | 282 | ||
Wells in progress | 1,695 | 1,695 | 1,610 | ||
Australia | |||||
Costs Incurred, Oil and Gas Property Acquisition, Exploration, and Development Activities [Line Items] | |||||
Unproved oil and gas properties | $0 | $0 | $0 |
Commitments_and_Contingencies_
Commitments and Contingencies (Details) | 3 Months Ended | 0 Months Ended | |||||||
Mar. 31, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Jun. 30, 2014 | Sep. 30, 2011 | Sep. 30, 2011 | Jan. 14, 2013 | Jan. 14, 2013 | Mar. 31, 2015 | |
USD ($) | GBP (£) | USD ($) | USD ($) | Nautilus Purchase and Sale Agreement (PSA) | Sopak Collateral Agreement | Sopak Collateral Agreement | MI3 | ||
USD ($) | Common Stock | Warrant | USD ($) | ||||||
Purchase Commitment, Excluding Long-term Commitment [Line Items] | |||||||||
Future contingent production payments payable | $5,000,000 | ||||||||
Number of shares available for purchase | 9,264,637 | 4,347,826 | |||||||
Cash call, amount | 2,000,000 | ||||||||
Outstanding cash calls | 2,284,000 | 1,540,000 | |||||||
Percent of interest in contingent payments | 52.00% | ||||||||
Accrued income taxes | 1,650,000 | 1,571,000 | |||||||
Contingent bonuses payable | $255,000 |
Related_Parties_Transactions_D
Related Parties Transactions (Details) | 9 Months Ended | 4 Months Ended | 9 Months Ended | |||||||
Mar. 31, 2015 | Mar. 31, 2014 | Mar. 31, 2015 | Mar. 31, 2015 | Mar. 31, 2014 | Mar. 31, 2015 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2015 | Mar. 31, 2015 | |
Compensation Arrangement | Compensation Arrangement | Davis Graham & STUBBS LLP | Davis Graham & STUBBS LLP | Davis Graham & STUBBS LLP | Devizes International Consulting Limited | Devizes International Consulting Limited | Key Energy Services Inc (KES) | MPA | MI3 | |
Director | Director | Affiliated Entity | Legal fees | Legal fees | Affiliated Entity | Affiliated Entity | Affiliated Entity | Compensation Arrangement | Compensation Arrangement | |
USD ($) | USD ($) | attorney | Affiliated Entity | Affiliated Entity | USD ($) | USD ($) | USD ($) | Director | Affiliated Entity | |
partner | USD ($) | USD ($) | AUD | USD ($) | ||||||
Related Party Transaction [Line Items] | ||||||||||
Number of attorneys - over | 140 | |||||||||
Number of partners - over | 65 | |||||||||
Amount of transaction | $0 | $2,500,000 | $307,000 | $82,000 | $137,000 | $85,000 | $2,200,000 | 5,400 | $502,000 |
Employee_Severance_Costs_Detai
Employee Severance Costs (Details) (USD $) | 9 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2015 |
Employee Severance, Termination Benefits [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Charges | $250 | |
Discontinued Operations [Member] | Employee Severance [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Charges | 1,500 | |
General and Administrative Expense [Member] | Employee Severance [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Charges | $475 |