Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2016 | Nov. 07, 2016 | |
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2016 | |
Document Fiscal Year Focus | 2,016 | |
Document Fiscal Period Focus | Q3 | |
Trading Symbol | SGY | |
Entity Registrant Name | STONE ENERGY CORP | |
Entity Central Index Key | 904,080 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 5,688,410 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEET - USD ($) $ in Thousands | Sep. 30, 2016 | Jul. 01, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Dec. 31, 2014 |
Current assets: | |||||
Cash and cash equivalents | $ 182,399 | $ 10,759 | $ 74,474 | $ 74,488 | |
Accounts receivable | 44,063 | 48,031 | |||
Fair value of derivative contracts | 6,261 | 38,576 | |||
Current income tax receivable | 19,863 | 46,174 | |||
Other current assets | 11,176 | 6,881 | |||
Total current assets | 263,762 | 150,421 | |||
Oil and gas properties, full cost method of accounting: | |||||
Proved | 9,564,561 | 9,375,898 | |||
Less: accumulated depreciation, depletion and amortization | (9,054,069) | (8,603,955) | |||
Net proved oil and gas properties | 510,492 | 771,943 | |||
Unevaluated | 404,226 | 440,043 | |||
Other property and equipment, net | 27,227 | 29,289 | |||
Other assets, net | 29,800 | 18,473 | |||
Total assets | 1,235,507 | 1,410,169 | |||
Current liabilities: | |||||
Accounts payable to vendors | 29,259 | 82,207 | |||
Undistributed oil and gas proceeds | 7,439 | 5,992 | |||
Accrued interest | 22,917 | 9,022 | |||
Asset retirement obligations | 60,223 | 21,291 | |||
Current portion of long-term debt | 292,795 | 0 | |||
Other current liabilities | 10,903 | 40,712 | |||
Total current liabilities | 423,536 | 159,224 | |||
Long-term debt | 1,122,945 | 1,060,955 | |||
Asset retirement obligations | 182,816 | 204,575 | |||
Other long-term liabilities | 25,871 | 25,204 | |||
Total liabilities | 1,755,168 | 1,449,958 | |||
Commitments and contingencies | |||||
Stockholders’ equity: | |||||
Common stock, $.01 par value; authorized 30,000,000 shares; issued 5,605,525 and 5,530,232 shares, respectively | 56 | 55 | |||
Treasury stock (1,658 shares, at cost) | (860) | (860) | |||
Additional paid-in capital | 1,657,028 | 1,648,687 | |||
Accumulated deficit | (2,179,803) | (1,705,623) | |||
Accumulated other comprehensive income | 3,918 | 17,952 | |||
Total stockholders’ equity | (519,661) | $ 50,000 | (39,789) | ||
Total liabilities and stockholders’ equity | $ 1,235,507 | $ 1,410,169 |
CONDENSED CONSOLIDATED BALANCE3
CONDENSED CONSOLIDATED BALANCE SHEET (Parenthetical) - $ / shares | Sep. 30, 2016 | Dec. 31, 2015 |
Statement of Financial Position [Abstract] | ||
Common stock, par value (in usd per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 30,000,000 | 30,000,000 |
Common stock, shares issued (in shares) | 5,605,525 | 5,530,232 |
Treasury stock, shares (in shares) | 1,658 | 1,658 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Operating revenue: | ||||
Oil production | $ 71,116 | $ 105,013 | $ 204,102 | $ 324,105 |
Natural gas production | 15,601 | 17,367 | 43,327 | 72,611 |
Natural gas liquids production | 6,666 | 5,980 | 15,119 | 29,379 |
Other operational income | 1,044 | 1,392 | 1,737 | 3,184 |
Derivative income, net | 0 | 2,444 | 0 | 4,871 |
Total operating revenue | 94,427 | 132,196 | 264,285 | 434,150 |
Operating expenses: | ||||
Lease operating expenses | 16,976 | 24,244 | 55,349 | 79,250 |
Transportation, processing and gathering expenses | 10,633 | 18,208 | 18,657 | 55,851 |
Production taxes | 835 | 2,052 | 1,894 | 6,394 |
Depreciation, depletion and amortization | 58,918 | 61,936 | 166,707 | 226,309 |
Write-down of oil and gas properties | 36,484 | 295,679 | 284,337 | 1,011,385 |
Accretion expense | 10,082 | 6,498 | 30,147 | 19,315 |
Salaries, general and administrative expenses | 15,425 | 19,552 | 48,193 | 52,977 |
Incentive compensation expense | 2,160 | 794 | 11,809 | 3,621 |
Restructuring fees | 5,784 | 0 | 16,173 | 0 |
Other operational expenses | 9,059 | 442 | 49,266 | 1,612 |
Derivative expense, net | 199 | 0 | 687 | 0 |
Total operating expenses | 166,555 | 429,405 | 683,219 | 1,456,714 |
Loss from operations | (72,128) | (297,209) | (418,934) | (1,022,564) |
Other (income) expenses: | ||||
Interest expense | 16,924 | 10,872 | 49,764 | 31,709 |
Interest income | (58) | (47) | (474) | (235) |
Other income | (272) | (411) | (840) | (1,167) |
Other expense | 16 | 148 | 27 | 148 |
Total other expenses | 16,610 | 10,562 | 48,477 | 30,455 |
Loss before income taxes | (88,738) | (307,771) | (467,411) | (1,053,019) |
Provision (benefit) for income taxes: | ||||
Current | (991) | 0 | (4,178) | 0 |
Deferred | 1,888 | (15,806) | 10,947 | (280,760) |
Total income taxes | 897 | (15,806) | 6,769 | (280,760) |
Net loss | $ (89,635) | $ (291,965) | $ (474,180) | $ (772,259) |
Basic loss per share (in usd per share) | $ (16.01) | $ (52.82) | $ (84.90) | $ (139.83) |
Diluted loss per share (in usd per share) | $ (16.01) | $ (52.82) | $ (84.90) | $ (139.83) |
Average shares outstanding (in shares) | 5,600 | 5,528 | 5,585 | 5,523 |
Average shares outstanding assuming dilution (in shares) | 5,600 | 5,528 | 5,585 | 5,523 |
CONDENSED CONSOLIDATED STATEME5
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Statement of Comprehensive Income [Abstract] | ||||
Net loss | $ (89,635) | $ (291,965) | $ (474,180) | $ (772,259) |
Other comprehensive income (loss), net of tax effect: | ||||
Derivatives | (3,467) | (5,353) | (20,107) | (45,691) |
Foreign currency translation | 0 | (246) | 6,073 | (2,567) |
Comprehensive loss | $ (93,102) | $ (297,564) | $ (488,214) | $ (820,517) |
CONDENSED CONSOLIDATED STATEME6
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2016 | Sep. 30, 2015 | |
Cash flows from operating activities: | ||
Net loss | $ (474,180) | $ (772,259) |
Adjustments to reconcile net loss to net cash provided by operating activities: | ||
Depreciation, depletion and amortization | 166,707 | 226,309 |
Write-down of oil and gas properties | 284,337 | 1,011,385 |
Accretion expense | 30,147 | 19,315 |
Deferred income tax provision (benefit) | 10,947 | (280,760) |
Settlement of asset retirement obligations | (15,106) | (59,826) |
Non-cash stock compensation expense | 6,407 | 9,163 |
Non-cash derivative expense | 1,261 | 10,854 |
Non-cash interest expense | 14,278 | 13,210 |
Other non-cash expense | 6,081 | 0 |
Change in current income taxes | 21,584 | 7,211 |
Decrease in accounts receivable | 3,968 | 33,895 |
Increase in other current assets | (4,426) | (1,090) |
Increase (decrease) in accounts payable | 3,217 | (11,592) |
Decrease in other current liabilities | (14,222) | (6,753) |
Other | (8,107) | (82) |
Net cash provided by operating activities | 32,893 | 198,980 |
Cash flows from investing activities: | ||
Investment in oil and gas properties | (200,622) | (385,528) |
Proceeds from sale of oil and gas properties, net of expenses | 0 | 11,643 |
Investment in fixed and other assets | (1,231) | (1,455) |
Change in restricted funds | 1,046 | 179,475 |
Net cash used in investing activities | (200,807) | (195,865) |
Cash flows from financing activities: | ||
Proceeds from bank borrowings | 477,000 | 5,000 |
Repayments of bank borrowings | (135,500) | (5,000) |
Repayments of building loan | (285) | 0 |
Deferred financing costs | (900) | 0 |
Net payments for share-based compensation | (752) | (3,127) |
Net cash provided by (used in) financing activities | 339,563 | (3,127) |
Effect of exchange rate changes on cash | (9) | (2) |
Net change in cash and cash equivalents | 171,640 | (14) |
Cash and cash equivalents, beginning of period | 10,759 | 74,488 |
Cash and cash equivalents, end of period | $ 182,399 | $ 74,474 |
Interim Financial Statements
Interim Financial Statements | 9 Months Ended |
Sep. 30, 2016 | |
Accounting Policies [Abstract] | |
Interim Financial Statements | Interim Financial Statements The condensed consolidated financial statements of Stone Energy Corporation (“Stone” or the "Company") and its subsidiaries as of September 30, 2016 and for the three and nine month periods ended September 30, 2016 and 2015 are unaudited and reflect all adjustments (consisting only of normal recurring adjustments), which are, in the opinion of management, necessary for a fair presentation of the financial position and operating results for the interim periods. The condensed consolidated balance sheet as of December 31, 2015 has been derived from the audited financial statements as of that date contained in our Annual Report on Form 10-K for the year ended December 31, 2015 (our “ 2015 Annual Report on Form 10-K”). The condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto, together with management’s discussion and analysis of financial condition and results of operations, contained in our 2015 Annual Report on Form 10-K. The results of operations for the three and nine month periods ended September 30, 2016 are not necessarily indicative of future financial results. Certain prior period amounts have been reclassified to conform to current period presentation. On May 27, 2016, the board of directors of the Company approved a 1-for-10 reverse stock split of the Company's issued and outstanding shares of common stock. The reverse stock split was effective upon the filing and effectiveness of a certificate of amendment to the Company's certificate of incorporation after the market closed on June 10, 2016, and the common stock began trading on a split-adjusted basis when the market opened on June 13, 2016. The effect of the reverse stock split was to combine each 10 shares of outstanding common stock prior to the reverse split into one new share subsequent to the reverse split. The Company's authorized shares of common stock were proportionately decreased in connection with the reverse stock split. Additionally, the overall and per share limitations in the Company’s 2009 Amended and Restated Stock Incentive Plan, as amended from time to time, and outstanding awards thereunder were also proportionately adjusted. The Company retained the current par value of $.01 per share for all shares of common stock. All references in the financial statements and notes thereto to number of shares, per share data, restricted stock and stock option data have been retroactively adjusted to give effect to the 1-for-10 reverse stock split. Stockholders' equity reflects the reverse stock split by reclassifying from common stock to additional paid-in capital an amount equal to the par value of the reduction in the number of shares as a result of the reverse split. |
Going Concern
Going Concern | 9 Months Ended |
Sep. 30, 2016 | |
Debt Disclosure [Abstract] | |
Going Concern | Going Concern The accompanying condensed consolidated financial statements have been prepared assuming the Company will continue as a going concern, which contemplates continuity of operations, realization of assets and the satisfaction of liabilities in the normal course of business for the twelve month period following the date of these condensed consolidated financial statements. As such, the accompanying condensed consolidated financial statements do not include any adjustments relating to the recoverability and classification of assets and their carrying amounts, or the amount and classification of liabilities that may result should the Company be unable to continue as a going concern. The level of our indebtedness of $1,428 million as of September 30, 2016 and the current commodity price environment have presented challenges as they relate to our ability to comply with the covenants in the agreements governing our indebtedness, particularly the maximum Consolidated Funded Debt to consolidated EBITDA (“Consolidated Funded Leverage”) financial covenant set forth in our bank credit agreement. If we exceed the maximum Consolidated Funded Leverage financial covenant, we would be required to seek a waiver or amendment from our bank lenders. If we are unable to reach an agreement with our banks or find acceptable alternative financing, it may lead to an event of default under our bank credit facility. If following an event of default, the banks were to accelerate repayment under the bank credit facility, it would result in an event of default and may result in the acceleration of our other debt instruments. On June 14, 2016, we entered into an amendment to the bank credit facility (see Note 5 – Debt ) which, among other things, requires that we maintain minimum liquidity of $125.0 million through January 15, 2017 and revised the maximum Consolidated Funded Leverage financial covenant from 3.75 to 1 to 5.25 to 1 for the fiscal quarter ended June 30, 2016, 6.50 to 1 for the fiscal quarter ended September 30, 2016, 9.50 to 1 for the fiscal quarter ending December 31, 2016 and 3.75 to 1 thereafter. We were in compliance with all covenants under the bank credit facility as of September 30, 2016, however, the minimum liquidity requirement and other restrictions under the credit facility may prevent us from being able to meet our interest payment obligation on the 7½% Senior Notes due in 2022 (the “2022 Notes”) in the fourth quarter of 2016 as well as the subsequent maturity of our 1¾% Senior Convertible Notes due in March 2017 (the “2017 Convertible Notes”). Additionally, we anticipate that we could exceed the Consolidated Funded Leverage financial covenant of 3.75 to 1 at the end of the first quarter of 2017 unless a material portion of our debt is repaid, reduced or exchanged into equity. As a result of the impact to our financial position from the drastic decline in commodity prices and in consideration of the current level of our indebtedness, we engaged advisors to assist with the evaluation of various strategic alternatives to address our liquidity and capital structure (see Note 12 – Restructuring Fees) . On October 20, 2016, we entered into a restructuring support agreement (the “RSA”) with certain holders of our 2017 Convertible Notes and our 2022 Notes (the "Noteholders") to support a restructuring on the terms of a pre-packaged plan of reorganization (the “Plan”). The RSA contemplates that we will file for voluntary relief under chapter 11 of the United States Bankruptcy Code (the "Bankruptcy Code") in a United States Bankruptcy Court (the "Bankruptcy Court") on or before December 9, 2016 to implement the Plan. Pursuant to the terms of the RSA, the Noteholders will receive (a) 95% of the common stock in reorganized Stone, (b) $225 million of new 7.5% second lien notes due 2022 and (c) $150 million of the net cash proceeds from the sale of Stone’s approximately 86,000 net acres in the Appalachia regions of Pennsylvania and West Virginia (the “Properties”) plus 85% of the net cash proceeds from the sale of the Properties in excess of $350 million , if any. Additionally, on October 20, 2016, we entered into a purchase and sale agreement (the “PSA”) with TH Exploration III, LLC, an affiliate of Tug Hill, Inc. (“Tug Hill”). Pursuant to the terms of the PSA, we agreed to sell the Properties to Tug Hill for $360 million in cash, subject to customary purchase price adjustments. The consummation of the Plan will be subject to customary conditions and other requirements, as well as the sale by Stone of the Properties for a cash purchase price of at least $350 million and approval of the Bankruptcy Court. On November 4, 2016, we entered into an amendment to the RSA (the “RSA Amendment”) with the Noteholders pursuant to which (a) Stone will be obligated to, at any time upon the written request of the Noteholders or their counsel, provide in writing to counsel to the Noteholders the good faith estimate of Stone – together with documentation requested by the Noteholders or their counsel – of any cure amounts or other payment obligations of Stone arising or resulting from the assumption of executory contracts or unexpired leases on both a “per contract” basis and in the aggregate, (b) the Noteholders will have the option to terminate the RSA at any time that the Noteholders determine, in their sole discretion, that the total amount of all such payments exceeds an amount acceptable to the Noteholders, (c) the Noteholders will have the unilateral right to extend the automatic termination of the RSA if the restructuring transactions contemplated by the RSA are not consummated by the one-hundredth (100th) calendar day after the Company files for chapter 11 bankruptcy, and (d) solicitation will commence by November 10, 2016. For additional details on the RSA, RSA Amendment and PSA, see Note 16 – Subsequent Events . We cannot provide any assurances that we will be able to complete a restructuring or asset sales on satisfactory terms to provide the liquidity to restructure or pay down our senior indebtedness. We have been engaged in discussions and have exchanged proposals with the lenders under our bank credit facility with respect to the treatment of the bank credit facility in a chapter 11 proceeding and a related amendment to the bank credit facility; however, no agreement has been reached. While we expect to continue discussions and related negotiations with our bank credit facility lenders, there can be no assurance that an agreement will be reached. The conditions noted above and the uncertainties surrounding the restructuring, asset sales, renegotiation of our bank credit facility and chapter 11 bankruptcy proceedings raise substantial doubt about our ability to continue as a going concern. New York Stock Exchange Compliance On April 29, 2016, we were notified by the New York Stock Exchange (“NYSE”) that we were not in compliance with the NYSE's continued listing requirements, as the average closing price of our shares of common stock had fallen below $1.00 per share over a period of 30 consecutive trading days, which is the minimum average share price for continued listing on the NYSE under Section 802.01C of the NYSE Listed Company Manual. On May 17, 2016, we were notified by the NYSE that our average global market capitalization had been less than $50 million over a consecutive 30 trading-day period at the same time that our stockholders' equity was less than $50 million , which is non-compliant with Section 802.01B of the NYSE Listed Company Manual. At the close of business on June 10, 2016, we effected a 1-for-10 reverse stock split (see Note 1 – Interim Financial Statements ) in order to increase the market price per share of our common stock in order to regain compliance with the NYSE's minimum share price requirement. We were notified on July 1, 2016 that we cured the minimum share price deficiency and that we were no longer considered non-compliant with the $1.00 per share average closing price requirement. We remain non-compliant with the $50 million market capitalization and stockholders' equity requirements. On June 30, 2016, we submitted our 18-month business plan for curing the average market capitalization and stockholders' equity deficiencies to the NYSE. The NYSE accepted the plan on August 4, 2016 and will continue to review the Company on a quarterly basis for compliance with the plan. Upon acceptance of the plan by the NYSE, and after two consecutive quarters of sustained market capitalization above $50 million , we would no longer be non-compliant with the market capitalization and stockholders' equity requirements. During the 18-month cure period, our shares of common stock will continue to be listed and traded on the NYSE, unless we experience other circumstances that subject us to delisting, including an abnormally low market capitalization. If we fail to meet the material aspects of the plan or any of the quarterly milestones, the NYSE will review the circumstances causing the variance and determine whether such variance warrants commencement of suspension and delisting procedures. Upon a delisting from the NYSE, we would commence trading on the OTC Pink. On September 20, 2016, we submitted our quarterly update to the business plan for the second quarter of 2016, and the NYSE notified us that it accepted the quarterly update on September 22, 2016. We expect to submit our third quarter 2016 plan update to the NYSE by mid-December. |
Earnings Per Share
Earnings Per Share | 9 Months Ended |
Sep. 30, 2016 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings Per Share The following table sets forth the calculation of basic and diluted weighted average shares outstanding and earnings per share for the indicated periods: Three Months Ended Nine Months Ended 2016 2015 2016 2015 (In thousands, except per share data) Income (numerator): Basic: Net loss $ (89,635 ) $ (291,965 ) $ (474,180 ) $ (772,259 ) Net income attributable to participating securities — — — — Net loss attributable to common stock - basic $ (89,635 ) $ (291,965 ) $ (474,180 ) $ (772,259 ) Diluted: Net loss $ (89,635 ) $ (291,965 ) $ (474,180 ) $ (772,259 ) Net income attributable to participating securities — — — — Net loss attributable to common stock - diluted $ (89,635 ) $ (291,965 ) $ (474,180 ) $ (772,259 ) Weighted average shares (denominator): Weighted average shares - basic 5,600 5,528 5,585 5,523 Dilutive effect of stock options — — — — Dilutive effect of convertible notes — — — — Weighted average shares - diluted 5,600 5,528 5,585 5,523 Basic loss per share $ (16.01 ) $ (52.82 ) $ (84.90 ) $ (139.83 ) Diluted loss per share $ (16.01 ) $ (52.82 ) $ (84.90 ) $ (139.83 ) All outstanding stock options were considered antidilutive during the three and nine months ended September 30, 2016 (approximately 12,900 shares) and during the three and nine months ended September 30, 2015 (approximately 14,400 shares) because we had net losses for such periods. During the three months ended September 30, 2016 and 2015 , approximately 12,900 shares and 1,832 shares of our common stock, respectively, were issued from authorized shares upon the lapsing of forfeiture restrictions of restricted stock for employees and nonemployee directors. During the nine months ended September 30, 2016 and 2015 , approximately 75,100 shares and 41,375 shares of our common stock, respectively, were issued from authorized shares upon the lapsing of forfeiture restrictions of restricted stock for employees and nonemployee directors. For the three and nine months ended September 30, 2016 and 2015 , the 2017 Convertible Notes had no dilutive effect on the diluted earnings per share computation as we had net losses for such periods. For the three and nine months ended September 30, 2016 and 2015 , the average price of our common stock was less than the strike price of the Sold Warrants (as defined in Note 5 – Debt ) and therefore, such warrants were not dilutive for such periods. Based on the terms of the Purchased Call Options (as defined in Note 5 – Debt ), such call options are antidilutive and therefore were not included in the calculation of diluted earnings per share. |
Derivative Instruments and Hedg
Derivative Instruments and Hedging Activities | 9 Months Ended |
Sep. 30, 2016 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Instruments and Hedging Activities | Derivative Instruments and Hedging Activities Our hedging strategy is designed to protect our near and intermediate term cash flows from future declines in oil and natural gas prices. This protection is essential to capital budget planning, which is sensitive to expenditures that must be committed to in advance, such as rig contracts and the purchase of tubular goods. We enter into derivative transactions to secure a commodity price for a portion of our expected future production that is acceptable at the time of the transaction. These derivatives are generally designated as cash flow hedges upon entering into the contracts. We do not enter into derivative transactions for trading purposes. We have no fair value hedges. The nature of a derivative instrument must be evaluated to determine if it qualifies as a hedging instrument. If the instrument qualifies as a hedging instrument, it is recorded as either an asset or liability measured at fair value and subsequent changes in the derivative’s fair value are recognized in stockholders’ equity through other comprehensive income (loss), net of related taxes, to the extent the hedge is considered effective. Monthly settlements of effective hedges are reflected in revenue from oil and natural gas production and cash flows from operating activities. Instruments not qualifying as hedging instruments are recorded in our balance sheet at fair value and subsequent changes in fair value are recognized in earnings through derivative expense (income). Monthly settlements of ineffective hedges and derivative instruments not qualifying as hedging instruments are recognized in earnings through derivative expense (income) and cash flows from operating activities. We have entered into fixed-price swaps and collars with various counterparties for a portion of our expected 2016 oil and natural gas production from the Gulf Coast Basin. Our fixed-price oil swap settlements and oil collar settlements are based on an average of the New York Mercantile Exchange (“NYMEX”) closing price for West Texas Intermediate crude oil during the entire calendar month. Our fixed-price gas swap settlements are based on the NYMEX price for the last day of a respective contract month. Swaps typically provide for monthly payments by us if prices rise above the swap price or monthly payments to us if prices fall below the swap price. Collar contracts typically require payments by us if the NYMEX average closing price is above the ceiling price or payments to us if the NYMEX average closing price is below the floor price. Our fixed-price swap contracts are with The Toronto-Dominion Bank, The Bank of Nova Scotia and Natixis. Our oil collar contract is with The Bank of Nova Scotia. All of our derivative transactions have been carried out in the over-the-counter market and are not typically subject to margin-deposit requirements. The use of derivative instruments involves the risk that the counterparties will be unable to meet the financial terms of such transactions. The counterparties to all of our derivative instruments have an "investment grade" credit rating. We monitor the credit ratings of our derivative counterparties on an ongoing basis. Although we have entered into derivative contracts with multiple counterparties to mitigate our exposure to any individual counterparty, if any of our counterparties were to default on its obligations to us under the derivative contracts or seek bankruptcy protection, we may not realize the benefit of some of our derivative instruments and incur a loss. At November 7, 2016 , two counterparties accounted for approximately 86% of our contracted volumes. All of our derivative instruments are with lenders under our bank credit facility. The following tables illustrate our derivative positions for calendar year 2016 as of November 7, 2016 : Fixed-Price Swaps (NYMEX) Natural Gas Oil Daily Volume (MMBtus/d) Swap Price ($) Daily Volume (Bbls/d) Swap Price ($) 2016 10,000 4.110 1,000 49.75 2016 10,000 4.120 1,000 52.78 2016 1,000 90.00 Collar (NYMEX) Oil Daily Volume (Bbls/d) Floor Price ($) Ceiling Price ($) 2016 1,000 45.00 54.75 We previously discontinued hedge accounting for certain 2015 natural gas contracts, as it became no longer probable, subsequent to the sale of our non-core Gulf of Mexico ("GOM") conventional shelf properties, that our GOM natural gas production would be sufficient to cover the GOM volumes hedged. Additionally, a small portion of our cash flow hedges are typically determined to be ineffective because oil and natural gas price changes in the markets in which we sell our products are not 100% correlative to changes in the underlying price basis indicative in the derivative contract. At September 30, 2016 , we had accumulated other comprehensive income of $3.9 million , net of tax, related to the fair value of our effective cash flow hedges that were outstanding as of September 30, 2016 . The $3.9 million of accumulated other comprehensive income will be reclassified into earnings in the next 12 months. Derivatives qualifying as hedging instruments: The following tables disclose the location and fair value amounts of derivatives qualifying as hedging instruments, as reported in our balance sheet, at September 30, 2016 and December 31, 2015 . Fair Value of Derivatives Qualifying as Hedging Instruments at September 30, 2016 (In millions) Asset Derivatives Liability Derivatives Description Balance Sheet Location Fair Value Balance Sheet Location Fair Value Commodity contracts Current assets: Fair value of derivative contracts $ 6.3 Current liabilities: Fair value of derivative contracts $ — Long-term assets: Fair value of derivative contracts — Long-term liabilities: Fair value of derivative contracts — $ 6.3 $ — Fair Value of Derivatives Qualifying as Hedging Instruments at December 31, 2015 (In millions) Asset Derivatives Liability Derivatives Description Balance Sheet Location Fair Value Balance Sheet Location Fair Value Commodity contracts Current assets: Fair value of derivative contracts $ 38.6 Current liabilities: Fair value of derivative contracts $ — Long-term assets: Fair value of derivative contracts — Long-term liabilities: Fair value of derivative contracts — $ 38.6 $ — The following tables disclose the before tax effect of derivatives qualifying as hedging instruments, as reported in the statement of operations, for the three and nine month periods ended September 30, 2016 and 2015 . Effect of Derivatives Qualifying as Hedging Instruments on the Statement of Operations for the Three Months Ended September 30, 2016 and 2015 (In millions) Derivatives in Amount of Gain Gain (Loss) Reclassified from Gain (Loss) Recognized in Income 2016 2015 Location 2016 2015 Location 2016 2015 Commodity contracts $ 2.3 $ 31.6 Operating revenue - oil/natural gas production $ 7.7 $ 39.9 Derivative income (expense), net $ (0.2 ) $ 1.2 Total $ 2.3 $ 31.6 $ 7.7 $ 39.9 $ (0.2 ) $ 1.2 (a) For the three months ended September 30, 2016 , effective hedging contracts increased oil revenue by $5.3 million and increased natural gas revenue by $2.4 million . For the three months ended September 30, 2015 , effective hedging contracts increased oil revenue by $36.3 million and increased natural gas revenue by $3.6 million . Effect of Derivatives Qualifying as Hedging Instruments on the Statement of Operations for the Nine Months Ended September 30, 2016 and 2015 (In millions) Derivatives in Amount of Gain Gain (Loss) Reclassified from Gain (Loss) Recognized in Income 2016 2015 Location 2016 2015 Location 2016 2015 Commodity contracts $ (1.7 ) $ 35.7 Operating revenue - $ 29.4 $ 107.1 Derivative income $ (0.7 ) $ 1.7 Total $ (1.7 ) $ 35.7 $ 29.4 $ 107.1 $ (0.7 ) $ 1.7 (a) For the nine months ended September 30, 2016 , effective hedging contracts increased oil revenue by $19.7 million and increased natural gas revenue by $9.7 million . For the nine months ended September 30, 2015 , effective hedging contracts increased oil revenue by $96.8 million and increased natural gas revenue by $10.3 million . Derivatives not qualifying as hedging instruments: Gains or losses related to changes in fair value and cash settlements for derivatives not qualifying as hedging instruments are recorded as derivative income (expense) in the statement of operations. The following table discloses the before tax effect of our derivatives not qualifying as hedging instruments on the statement of operations, for the three and nine month periods ended September 30, 2016 and 2015 . Gain (Loss) Recognized in Derivative Income (Expense) (In millions) Three Months Ended Nine Months Ended Description 2016 2015 2016 2015 Commodity contracts: Cash settlements $ — $ 3.8 $ — $ 11.0 Change in fair value — (2.6 ) — (7.9 ) Total gains (losses) on non-qualifying hedges $ — $ 1.2 $ — $ 3.1 Offsetting of derivative assets and liabilities: Our derivative contracts are subject to netting arrangements. It is our policy to not offset our derivative contracts in presenting the fair value of these contracts as assets and liabilities in our balance sheet. As of September 30, 2016 and December 31, 2015 , all of our derivative contracts were in an asset position and therefore, there was no potential impact of the rights of offset. |
Debt
Debt | 9 Months Ended |
Sep. 30, 2016 | |
Debt Disclosure [Abstract] | |
Debt | Debt Our debt balances (net of related unamortized discounts and debt issuance costs) as of September 30, 2016 and December 31, 2015 were as follows: September 30, December 31, (In millions) 1 3 ⁄ 4 % Senior Convertible Notes due 2017 $ 292.4 $ 279.3 7 1 ⁄ 2 % Senior Notes due 2022 770.4 770.0 Revolving credit facility 341.5 — 4.20% Building Loan 11.4 11.7 Total debt 1,415.7 1,061.0 Less: current portion of long-term debt (292.8 ) — Long-term debt $ 1,122.9 $ 1,061.0 Current Portion of Long-Term Debt. As of September 30, 2016 , the current portion of long-term debt of $292.8 million consisted of $292.4 million of 2017 Convertible Notes and $0.4 million of principal payments due within one year on the Building Loan. Revolving Credit Facility. On June 24, 2014 , we entered into a revolving credit facility (the Fourth Amended and Restated Credit Agreement dated as of June 24, 2014) with commitments totaling $900 million (subject to borrowing base limitations) through a syndicated bank group, with an initial borrowing base of $500 million . The bank credit facility matures on July 1, 2019 . On April 13, 2016 , our borrowing base under the bank credit facility was reduced from $500 million to $300 million . On that date, we had $457 million of outstanding borrowings and $18.3 million of outstanding letters of credit, or $175.3 million in excess of the redetermined borrowing base (referred to as a borrowing base deficiency). Our agreement with the banks provides that within 30 days after notification of a borrowing base deficiency, we must elect to cure the borrowing base deficiency through any combination of the following actions: (1) repay amounts outstanding sufficient to cure the deficiency within 10 days after our written election to do so; (2) add additional oil and gas properties acceptable to the banks to the borrowing base and take such actions necessary to grant the banks a mortgage in the properties within 30 days after our written election to do so; and/or (3) arrange to pay the deficiency in six equal monthly installments. We elected to pay the deficiency in six equal monthly installments, making the first payment of $29.2 million on May 13, 2016 and the second payment of $29.2 million on June 13, 2016. On June 14, 2016, we entered into Amendment No. 3 (the "Amendment") to the bank credit facility to (i) increase the borrowing base to $360 million from $300 million , (ii) provide for no redetermination of the borrowing base by the lenders until January 15, 2017, other than an automatic reduction upon the sale of certain of our properties, (iii) permit second lien indebtedness to refinance the existing 2017 Convertible Notes and 2022 Notes, (iv) revise the maximum Consolidated Funded Leverage financial covenant to be 5.25 to 1 for the fiscal quarter ended June 30, 2016, 6.50 to 1 for the fiscal quarter ended September 30, 2016, 9.50 to 1 for the fiscal quarter ending December 31, 2016 and 3.75 to 1 thereafter, (v) require minimum liquidity (as defined in the Amendment) of at least $125.0 million until January 15, 2017, (vi) impose limitations on capital expenditures of $60 million for the period of June 1, 2016 through December 31, 2016, but allowing for an additional $25 million to be expended for Appalachian drilled but uncompleted wells, (vii) grant the lenders a perfected security interest in all deposit accounts and (viii) provide for anti-hoarding cash provisions for amounts in excess of $50.0 million to apply after December 10, 2016. Upon execution of the Amendment, we repaid $56.8 million in borrowings under the credit facility, which eliminated the borrowing base deficiency and brought the total borrowings and letters of credit outstanding under the bank credit facility in conformity with the borrowing base limitation. On October 20, 2016, we entered into the RSA with the Noteholders to support a restructuring on the terms of the Plan. The RSA contemplates that we will file for voluntary relief under chapter 11 of the Bankruptcy Code on or before December 9, 2016 to implement the Plan (see Note 16 – Subsequent Events ). We have been engaged in discussions and have exchanged proposals with the lenders under our bank credit facility with respect to the treatment of the bank credit facility in a chapter 11 proceeding and a related amendment to the bank credit facility; however, no agreement has been reached. While we expect to continue discussions and related negotiations with the lenders under our bank credit facility, there can be no assurance that an agreement will be reached. On September 30 and November 7, 2016 , we had $341.5 million of outstanding borrowings and $12.5 million of outstanding letters of credit, leaving $6.0 million of availability under the bank credit facility. The weighted average interest rate under the bank credit facility was approximately 3.1% at September 30, 2016 . Subject to certain exceptions, the bank credit facility is required to be guaranteed by all of our material domestic direct and indirect subsidiaries. As of September 30, 2016 , the bank credit facility was guaranteed by our only material subsidiary, Stone Energy Offshore, L.L.C. (“Stone Offshore”). On August 29, 2016, our subsidiaries SEO A LLC and SEO B LLC were merged into Stone Offshore. The borrowing base under the bank credit facility is redetermined semi-annually, typically in May and November, by the lenders, taking into consideration the estimated loan value of our oil and gas properties and those of our subsidiaries that guarantee the bank credit facility in accordance with the lenders’ customary practices for oil and gas loans. In addition, we and the lenders each have discretion at any time, but not more than two additional times in any calendar year, to have the borrowing base redetermined. However, the Amendment provides for no redetermination of the borrowing base by the lenders until January 15, 2017, other than an automatic reduction upon the sale of certain of our properties. The bank credit facility is collateralized by substantially all of our assets and the assets of our material subsidiaries. We are required to mortgage, and grant a security interest in, our oil and natural gas reserves representing at least 86% of the discounted present value of the future net cash flows from our proved oil and natural gas reserves reviewed in determining the borrowing base. Interest on loans under the bank credit facility is calculated using the London Interbank Offering (“LIBOR”) rate or the base rate, at our election. The margin for loans at the LIBOR rate is determined based on borrowing base utilization and ranges from 1.500% to 2.500% . In addition to the covenants discussed above, the bank credit facility provides that we must maintain a ratio of consolidated EBITDA to consolidated Net Interest Expense, as defined in the credit agreement, for the preceding four quarterly periods of not less than 2.5 to 1. The bank credit facility also includes certain customary restrictions or requirements with respect to disposition of properties, incurrence of additional debt, change of control and reporting responsibilities. These covenants may limit or prohibit us from paying cash dividends but do allow for limited stock repurchases. These covenants also restrict our ability to prepay other indebtedness under certain circumstances. We were in compliance with all covenants as of September 30, 2016 . Senior Notes. Our senior notes consist of $300 million of 2017 Convertible Notes and $775 million of 2022 Notes. On October 20, 2016, we entered into the RSA with the Noteholders to support a restructuring on the terms of the Plan. The RSA contemplates that we will file for voluntary relief under chapter 11 of the Bankruptcy Code on or before December 9, 2016 to implement the Plan (see Note 16 – Subsequent Events ). 2017 Convertible Notes. On March 6, 2012, we issued in a private offering $300 million in aggregate principal amount of the 2017 Convertible Notes to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”). The 2017 Convertible Notes are convertible into cash, shares of our common stock or a combination of cash and shares of our common stock, based on an initial conversion rate of 23.4449 shares of our common stock per $1,000 principal amount of 2017 Convertible Notes, which corresponded to an initial conversion price of approximately $42.65 per share of our common stock at the time of the issuance of the 2017 Convertible Notes. The conversion rate, and thus the conversion price, may be adjusted under certain circumstances as described in the indenture related to the 2017 Convertible Notes. Upon conversion, we will be obligated to pay or deliver, as the case may be, cash, shares of our common stock or a combination of cash and shares of our common stock. Prior to December 1, 2016, the 2017 Convertible Notes will be convertible only upon the occurrence of certain events and during certain periods, and thereafter, at any time until the second scheduled trading day immediately preceding the maturity date. On June 10, 2016, we completed a 1-for-10 reverse stock split with respect to our common stock (see Note 1 – Interim Financial Statements ). Proportional adjustments were made to the conversion price and shares as they relate to the 2017 Convertible Notes, resulting in a conversion rate of 2.34449 shares of our common stock with a corresponding conversion price of $426.50 per share. On September 30, 2016 , our closing share price was $11.88 per share. The 2017 Convertible Notes will be due on March 1, 2017, unless earlier converted or repurchased by us at the option of the holder(s), and interest is payable on the 2017 Convertible Notes each March 1and September 1. On the maturity date, each holder will be entitled to receive $1,000 in cash for each $1,000 in principal amount of 2017 Convertible Notes, together with any accrued and unpaid interest to, but excluding, the maturity date. In connection with the offering, we entered into convertible note hedge transactions with respect to our common stock (the “Purchased Call Options”) with Barclays Capital Inc., acting as agent for Barclays Bank PLC and Bank of America, N.A. (the “Dealers”). We paid an aggregate amount of approximately $70.8 million to the Dealers for the Purchased Call Options. The Purchased Call Options cover, subject to customary antidilution adjustments, approximately 703,347 shares of our common stock at a strike price that corresponds to the initial conversion price of the 2017 Convertible Notes (after the effectiveness of the reverse stock split of 1-for-10), also subject to adjustment, and are exercisable upon conversion of the 2017 Convertible Notes. We also entered into separate warrant transactions whereby, in reliance upon the exemption from registration provided by Section 4(a)(2) of the Securities Act, we sold to the Dealers warrants to acquire, subject to customary antidilution adjustments, approximately 703,347 shares of our common stock (the “Sold Warrants”) at a strike price of $559.10 per share of our common stock (after the effectiveness of the reverse stock split of 1-for-10). We received aggregate proceeds of approximately $40.1 million from the sale of the Sold Warrants to the Dealers. If, upon expiration of the Sold Warrants, the price per share of our common stock, as measured under the Sold Warrants, is greater than the strike price of the Sold Warrants, we will be required to issue, without further consideration, under each Sold Warrant a number of shares of our common stock with a value equal to the amount of such difference. As of September 30, 2016 , the carrying amount of the liability component of the 2017 Convertible Notes of $292.4 million was classified as a current liability. During the three and nine months ended September 30, 2016 , we recognized $4.1 million and $12.0 million , respectively, of interest expense for the amortization of the discount and $0.4 million and $1.1 million , respectively, of interest expense for the amortization of deferred financing costs related to the 2017 Convertible Notes. During the three and nine months ended September 30, 2015 , we recognized $3.8 million and $11.1 million , respectively, of interest expense for the amortization of the discount and $0.4 million and $1.1 million , respectively, of interest expense for the amortization of deferred financing costs related to the 2017 Convertible Notes. During the three and nine month periods ended September 30, 2016 , we recognized $1.3 million and $3.9 million , respectively, of interest expense related to the contractual interest coupon on the 2017 Convertible Notes. During the three and nine month periods ended September 30, 2015 , we recognized $1.3 million and $3.9 million , respectively, of interest expense related to the contractual interest coupon on the 2017 Convertible Notes. 2022 Notes. On November 8, 2012 and November 27, 2013, respectively, we completed the public offering of $300 million and $475 million aggregate principal amount of our 2022 Notes. The 2022 Notes mature on November 15, 2022. We have an interest payment obligation under our 2022 Notes of approximately $29.2 million , due on November 15, 2016. The indenture governing the 2022 Notes provides a 30 -day grace period that extends the latest date for making this cash interest payment to December 15, 2016 before an Event of Default occurs under the indenture, which would give the trustee or the holders of at least 25% in principal amount of the 2022 Notes the option to accelerate payment of the principal plus accrued and unpaid interest on the 2022 Notes. |
Asset Retirement Obligations
Asset Retirement Obligations | 9 Months Ended |
Sep. 30, 2016 | |
Asset Retirement Obligation Disclosure [Abstract] | |
Asset Retirement Obligations | Asset Retirement Obligations The change in our asset retirement obligations during the nine months ended September 30, 2016 is set forth below: Nine Months Ended (In millions) Asset retirement obligations as of the beginning of the period, including current portion $ 225.9 Liabilities incurred 2.1 Liabilities settled (15.1 ) Accretion expense 30.1 Asset retirement obligations as of the end of the period, including current portion $ 243.0 |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2016 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes As a result of the significant declines in commodity prices and the resulting ceiling test write-downs and net losses incurred, we determined during 2015 that it was more likely than not that a portion of our deferred tax assets will not be realized in the future. Accordingly, we established a valuation allowance against a portion of our deferred tax assets. As of September 30, 2016 , our valuation allowance totaled $343.1 million. Our effective tax rate for the nine months ended September 30, 2016 was 1.4% . This percentage differed from the federal statutory rate of 35.0% primarily due to the establishment of the valuation allowance against deferred tax assets. Our assessment of the realizability of our deferred tax assets is based on the weight of all available evidence, both positive and negative, including future reversals of deferred tax liabilities. We had a current income tax receivable of $ 19.9 million at September 30, 2016 , which relates to expected tax refunds from the carryback of net operating losses to previous tax years. Additionally, we had $4.7 million of non-current income tax receivables at September 30, 2016 reflected in Other Assets, as the refunds are not expected to be received within twelve months. |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 30, 2016 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements U.S. Generally Accepted Accounting Principles establish a fair value hierarchy that has three levels based on the reliability of the inputs used to determine the fair value. These levels include: Level 1, defined as inputs such as unadjusted quoted prices in active markets for identical assets or liabilities; Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable; and Level 3, defined as unobservable inputs for use when little or no market data exists, therefore requiring an entity to develop its own assumptions. As of September 30, 2016 and December 31, 2015 , we held certain financial assets that are required to be measured at fair value on a recurring basis, including our commodity derivative instruments and our investments in marketable securities. We utilize the services of an independent third party to assist us in valuing our derivative instruments. We used the income approach in determining the fair value of our derivative instruments utilizing a proprietary pricing model. The model accounts for our credit risk and the credit risk of our counterparties in the discount rate applied to estimated future cash inflows and outflows. Our swap contracts are included within the Level 2 fair value hierarchy, and our collar contracts are included within the Level 3 fair value hierarchy. Significant unobservable inputs used in establishing fair value for the collars were the volatility impacts in the pricing model as it relates to the call portion of the collar. For a more detailed description of our derivative instruments, see Note 4 – Derivative Instruments and Hedging Activities . We used the market approach in determining the fair value of our investments in marketable securities, which are included within the Level 1 fair value hierarchy. We had no liabilities measured at fair value on a recurring basis at September 30, 2016 and December 31, 2015. The following tables present our assets that are measured at fair value on a recurring basis at September 30, 2016 and December 31, 2015. Fair Value Measurements at September 30, 2016 Assets Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) (In millions) Marketable securities (Other assets) $ 8.8 $ 8.8 $ — $ — Derivative contracts 6.3 — 6.3 — Total $ 15.1 $ 8.8 $ 6.3 $ — Fair Value Measurements at December 31, 2015 Assets Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) (In millions) Marketable securities (Other assets) $ 8.5 $ 8.5 $ — $ — Derivative contracts 38.6 — 36.6 2.0 Total $ 47.1 $ 8.5 $ 36.6 $ 2.0 The table below presents a reconciliation for assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3) during the nine months ended September 30, 2016 . Hedging Contracts, net (In millions) Balance as of January 1, 2016 $ 2.0 Total gains/(losses) (realized or unrealized): Included in earnings 1.1 Included in other comprehensive income (1.9 ) Purchases, sales, issuances and settlements (1.2 ) Transfers in and out of Level 3 — Balance as of September 30, 2016 $ — The amount of total gains/(losses) for the period included in earnings (derivative income) attributable to the change in unrealized gain/(losses) relating to derivatives still held at September 30, 2016 $ — The fair value of cash and cash equivalents approximated book value at September 30, 2016 and December 31, 2015 . As of September 30, 2016 and December 31, 2015 , the fair value of the liability component of the 2017 Convertible Notes was approximately $278.6 million and $217.1 million , respectively. As of September 30, 2016 and December 31, 2015 , the fair value of the 2022 Notes was approximately $441.8 million and $271.3 million , respectively. The fair value of the 2022 Notes was determined based on quotes obtained from brokers, which represent Level 1 inputs. We applied fair value concepts in determining the liability component of the 2017 Convertible Notes (see Note 5 – Debt ) at inception, September 30, 2016 and December 31, 2015 . The fair value of the liability was estimated using an income approach. The significant inputs in these determinations were market interest rates based on quotes obtained from brokers and represent Level 2 inputs. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income (Loss) | 9 Months Ended |
Sep. 30, 2016 | |
Equity [Abstract] | |
Accumulated Other Comprehensive Income (Loss) | Accumulated Other Comprehensive Income (Loss) For the three months ended September 30, 2016, the only component of accumulated other comprehensive income (loss) related to our cash flow hedges. Changes in accumulated other comprehensive income (loss) for the three and nine months ended September 30, 2016 , were as follows (in millions): Cash Flow Hedges Three Months Ended September 30, 2016 Beginning balance, net of tax $ 7.4 Other comprehensive income (loss) before reclassifications: Change in fair value of derivatives 2.3 Income tax effect (0.8 ) Net of tax 1.5 Amounts reclassified from accumulated other comprehensive income: Operating revenue: oil/natural gas production 7.7 Income tax effect (2.7 ) Net of tax 5.0 Other comprehensive loss, net of tax (3.5 ) Ending balance, net of tax $ 3.9 Cash Flow Hedges Foreign Currency Items Total Nine Months Ended September 30, 2016 Beginning balance, net of tax $ 24.0 $ (6.0 ) $ 18.0 Other comprehensive income (loss) before reclassifications: Change in fair value of derivatives (1.7 ) — (1.7 ) Income tax effect 0.6 — 0.6 Net of tax (1.1 ) — (1.1 ) Amounts reclassified from accumulated other comprehensive income: Operating revenue: oil/natural gas production 29.4 — 29.4 Other operational expenses — (6.0 ) (6.0 ) Income tax effect (10.4 ) — (10.4 ) Net of tax 19.0 (6.0 ) 13.0 Other comprehensive income (loss), net of tax (20.1 ) 6.0 (14.1 ) Ending balance, net of tax $ 3.9 $ — $ 3.9 Changes in accumulated other comprehensive income (loss) for the three and nine months ended September 30, 2015 , were as follows (in millions): Cash Flow Hedges Foreign Currency Items Total Three Months Ended September 30, 2015 Beginning balance, net of tax $ 46.5 $ (5.8 ) $ 40.7 Other comprehensive income (loss) before reclassifications: Change in fair value of derivatives 31.6 — 31.6 Foreign currency translations — (0.2 ) (0.2 ) Income tax effect (11.5 ) — (11.5 ) Net of tax 20.1 (0.2 ) 19.9 Amounts reclassified from accumulated other comprehensive income: Operating revenue: oil/natural gas production 39.9 — 39.9 Income tax effect (14.4 ) — (14.4 ) Net of tax 25.5 — 25.5 Other comprehensive loss, net of tax (5.4 ) (0.2 ) (5.6 ) Ending balance, net of tax $ 41.1 $ (6.0 ) $ 35.1 Cash Flow Foreign Total Nine Months Ended September 30, 2015 Beginning balance, net of tax $ 86.8 $ (3.5 ) $ 83.3 Other comprehensive income (loss) before reclassifications: Change in fair value of derivatives 35.7 — 35.7 Foreign currency translations — (2.5 ) (2.5 ) Income tax effect (12.8 ) — (12.8 ) Net of tax 22.9 (2.5 ) 20.4 Amounts reclassified from accumulated other comprehensive income: Operating revenue: oil/natural gas production 107.1 — 107.1 Income tax effect (38.5 ) — (38.5 ) Net of tax 68.6 — 68.6 Other comprehensive loss, net of tax (45.7 ) (2.5 ) (48.2 ) Ending balance, net of tax $ 41.1 $ (6.0 ) $ 35.1 During the nine months ended September 30, 2016 , we reclassified approximately $6.0 million of losses related to cumulative foreign currency translation adjustments from accumulated other comprehensive income into other operational expenses upon the substantial liquidation of our foreign subsidiary, Stone Energy Canada ULC. |
Investment in Oil and Gas Prope
Investment in Oil and Gas Properties | 9 Months Ended |
Sep. 30, 2016 | |
Extractive Industries [Abstract] | |
Investment in Oil and Gas Properties | Investment in Oil and Gas Properties Under the full cost method of accounting, we compare, at the end of each financial reporting period, the present value of estimated future net cash flows from proved reserves (adjusted for hedges and excluding cash flows related to estimated abandonment costs) to the net capitalized costs of proved oil and gas properties, net of related deferred taxes. We refer to this comparison as a ceiling test. If the net capitalized costs of proved oil and gas properties exceed the estimated discounted future net cash flows from proved reserves, we are required to write down the value of our oil and gas properties to the value of the discounted cash flows. At September 30, 2016, our ceiling test computation resulted in a write-down of our U.S. oil and gas properties of $36.5 million based on twelve-month average prices, net of applicable differentials, of $40.51 per Bbl of oil, $1.99 per Mcf of natural gas and $13.88 per Bbl of natural gas liquids ("NGLs"). The write-down at September 30, 2016 was decreased by $9.6 million as a result of hedges. At June 30, 2016, our ceiling test computation resulted in a write-down of our U.S. oil and gas properties of $118.6 million based on twelve-month average prices, net of applicable differentials, of $43.49 per Bbl of oil, $1.93 per Mcf of natural gas and $9.33 per Bbl of NGLs. The write-down at June 30, 2016 was decreased by $18.1 million as a result of hedges. At March 31, 2016, our ceiling test computation resulted in a write-down of our U.S. oil and gas properties of $128.9 million based on twelve-month average prices, net of applicable differentials, of $46.72 per Bbl of oil, $2.01 per Mcf of natural gas and $13.65 per Bbl of NGLs. At March 31, 2016, the write-down of oil and gas properties also included $0.3 million related to our Canadian oil and gas properties, which were deemed to be fully impaired at the end of 2015. The write-down at March 31, 2016 was decreased by $23 million as a result of hedges. |
Other Operational Expenses
Other Operational Expenses | 9 Months Ended |
Sep. 30, 2016 | |
Other Income and Expenses [Abstract] | |
Other Operational Expenses | Other Operational Expenses Included in other operational expenses for the nine months ended September 30, 2016 is a $6.0 million loss on the substantial liquidation of our foreign subsidiary, Stone Energy Canada ULC, representing cumulative foreign currency translation adjustments, which were reclassified from accumulated other comprehensive income. See Note 9 – Accumulated Other Comprehensive Income (Loss) . Also included in other operational expenses for the nine months ended September 30, 2016 are approximately $15.3 million of rig subsidy and stacking charges related to the ENSCO 8503 deep water drilling rig, an Appalachian drilling rig and the platform rig at Pompano, a $20 million charge related to the termination of our deep water drilling rig contract with Ensco and $7.5 million in charges related to the terminations of the Appalachian drilling rig contract and a contract with an offshore vessel provider. |
Restructuring Fees
Restructuring Fees | 9 Months Ended |
Sep. 30, 2016 | |
Restructuring and Related Activities [Abstract] | |
Restructuring Fees | Restructuring Fees In March 2016, we retained financial and legal advisors to assist the Company in analyzing and considering financial, transactional and strategic alternatives. We have been engaged in negotiations with financial advisors for certain holders of the 2017 Convertible Notes and 2022 Notes regarding the restructuring of the notes and in June 2016, we secured an amendment to our existing credit facility with our bank group. On October 20, 2016, we entered into the RSA with the Noteholders to support a restructuring on the terms of the Plan. We have also been engaged in discussions and have exchanged proposals with the lenders under our bank credit facility with respect to the treatment of the bank credit facility in a chapter 11 proceeding and a related amendment to the bank credit facility. The legal and financial advisory costs associated with these restructuring efforts are included in the statement of operations as restructuring fees and totaled $5.8 million and $16.2 million for the three and nine months ended September 30, 2016, respectively. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies On March 21, 2016, we received notice letters from the Bureau of Ocean Energy Management ("BOEM") stating that BOEM had determined that we no longer qualified for a supplemental bonding waiver under the financial criteria specified in BOEM’s guidance to lessees at such time. BOEM's notice letters indicated the amount of Stone's supplemental bonding needs could be as much as $565 million . In late March 2016, we proposed a tailored plan to BOEM for financial assurances relating to our abandonment obligations, which provides for posting some incremental financial assurances in favor of BOEM. On May 13, 2016, we received notice letters from BOEM rescinding its demand for supplemental bonding with the understanding that we will continue to make progress with BOEM in finalizing and implementing our long-term tailored plan. Currently, we have posted an aggregate of approximately $139 million in surety bonds in favor of BOEM, third party bonds and letters of credit, all relating to our offshore abandonment obligations. We have submitted our tailored plan to BOEM and are awaiting its review and approval. Additionally, on July 14, 2016, BOEM issued a Notice to Lessees (“NTL”) that augments requirements for the posting of additional financial assurances by offshore lessees, among others, to assure that sufficient funds are available to perform decommissioning obligations with respect to offshore wells, platforms, pipelines and other facilities. The NTL, effective September 12, 2016, does away with the agency's past practice of waiving supplemental bonding obligations where a company could demonstrate a certain level of financial strength. Instead, BOEM will allow companies to “self-insure”, but only up to 10% of a company’s “tangible net worth”, which is defined as the difference between a company’s total assets and the value of all liabilities and intangible assets. The NTL provides new procedures for how BOEM determines a lessee’s decommissioning obligations and, consistent with those procedures, BOEM has tentatively proposed an implementation timeline that offshore lessees will follow in providing additional financial assurance, including BOEM’s issuance of (i) “Self-Insurance” letters beginning September 12, 2016 (regarding a lessee’s ability to self-insure a portion of the additional financial assurance), (ii) “Proposal” letters beginning October 12, 2016 (outlining what amount of additional security a lessee will be required to provide), and (iii) “Order” letters beginning November 14, 2016 (triggering a lessee’s obligations (A) within 10 days of such letter to notify BOEM that it intends to pursue a “tailored plan” for posting additional security over a phased-in period of time, (B) within 60 days of such letter, provide additional security for “sole liability” properties (leases or grants for which there is no other current or prior owner who is liable for decommissioning obligations), and (C) within 120 days of such letter, provide additional security for any other properties and/or submit a tailored financial plan). BOEM tentatively expects to approve or deny tailored plans submitted by lessees on or around September 11, 2017, although extensions may be granted to companies actively working with BOEM to finalize tailored plans. We received a Self-Insurance letter from BOEM dated September 30, 2016 stating that we are not eligible to self-insure any of our additional security obligations. We received a Proposal letter from BOEM dated October 20, 2016 indicating that additional security will be required, and we intend to work with BOEM to adjust our previously submitted tailored plan for the provision of new financial assurances required to be posted as a result of the new NTL. Our revised proposed plan would require approximately $35 million to $40 million of incremental financial assurance or bonding for 2016 through 2017, a portion of which may require cash collateral. Under the revised plan, additional financial assurance would be required for subsequent years. There is no assurance this tailored plan will be approved by BOEM. |
Recently Issued Accounting Stan
Recently Issued Accounting Standards | 9 Months Ended |
Sep. 30, 2016 | |
Accounting Changes and Error Corrections [Abstract] | |
Recently Issued Accounting Standards | Recently Issued Accounting Standards In February 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2016-02, " Leases (Topic 842) " to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. The standard is effective for public entities for fiscal years beginning after December 15, 2018, and for interim periods within those fiscal years, with earlier application permitted. Upon adoption the lessee will apply the new standard retrospectively to all periods presented or retrospectively using a cumulative effect adjustment in the year of adoption. We are currently evaluating the effect that this new standard may have on our financial statements. In March 2016, the FASB issued ASU 2016-09, " Compensation – Stock Compensation (Topic 718) " to simplify several aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and forfeitures, as well as classification in the statement of cash flows. The standard is effective for public entities for fiscal years beginning after December 15, 2016, and for interim periods within those fiscal years. Early adoption is permitted for any entity in any interim or annual period. An entity that elects early adoption must adopt all of the amendments in ASU 2016-09 in the same period. We are currently evaluating the effect that this new standard may have on our financial statements, but we do not anticipate the implementation of this new standard will have a material effect. In August 2016, the FASB issued ASU 2016-15, " Statement of Cash Flows (Topic 230), Classification of Certain Cash Receipts and Cash Payments " to reduce diversity in practice in how certain cash receipts and cash payments are presented and classified in the statement of cash flows. The standard is effective for public entities for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. Early adoption is permitted for any entity in any interim or annual period. An entity that elects early adoption must adopt all of the amendments in ASU 2016-15 in the same period, and any adjustments should be reflected as of the beginning of the fiscal year that includes that interim period. We are currently evaluating the effect that this new standard may have on our financial statements, but we do not anticipate the implementation of this new standard will have a material effect. |
New York Stock Exchange Complia
New York Stock Exchange Compliance | 9 Months Ended |
Sep. 30, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
New York Stock Exchange Compliance | Going Concern The accompanying condensed consolidated financial statements have been prepared assuming the Company will continue as a going concern, which contemplates continuity of operations, realization of assets and the satisfaction of liabilities in the normal course of business for the twelve month period following the date of these condensed consolidated financial statements. As such, the accompanying condensed consolidated financial statements do not include any adjustments relating to the recoverability and classification of assets and their carrying amounts, or the amount and classification of liabilities that may result should the Company be unable to continue as a going concern. The level of our indebtedness of $1,428 million as of September 30, 2016 and the current commodity price environment have presented challenges as they relate to our ability to comply with the covenants in the agreements governing our indebtedness, particularly the maximum Consolidated Funded Debt to consolidated EBITDA (“Consolidated Funded Leverage”) financial covenant set forth in our bank credit agreement. If we exceed the maximum Consolidated Funded Leverage financial covenant, we would be required to seek a waiver or amendment from our bank lenders. If we are unable to reach an agreement with our banks or find acceptable alternative financing, it may lead to an event of default under our bank credit facility. If following an event of default, the banks were to accelerate repayment under the bank credit facility, it would result in an event of default and may result in the acceleration of our other debt instruments. On June 14, 2016, we entered into an amendment to the bank credit facility (see Note 5 – Debt ) which, among other things, requires that we maintain minimum liquidity of $125.0 million through January 15, 2017 and revised the maximum Consolidated Funded Leverage financial covenant from 3.75 to 1 to 5.25 to 1 for the fiscal quarter ended June 30, 2016, 6.50 to 1 for the fiscal quarter ended September 30, 2016, 9.50 to 1 for the fiscal quarter ending December 31, 2016 and 3.75 to 1 thereafter. We were in compliance with all covenants under the bank credit facility as of September 30, 2016, however, the minimum liquidity requirement and other restrictions under the credit facility may prevent us from being able to meet our interest payment obligation on the 7½% Senior Notes due in 2022 (the “2022 Notes”) in the fourth quarter of 2016 as well as the subsequent maturity of our 1¾% Senior Convertible Notes due in March 2017 (the “2017 Convertible Notes”). Additionally, we anticipate that we could exceed the Consolidated Funded Leverage financial covenant of 3.75 to 1 at the end of the first quarter of 2017 unless a material portion of our debt is repaid, reduced or exchanged into equity. As a result of the impact to our financial position from the drastic decline in commodity prices and in consideration of the current level of our indebtedness, we engaged advisors to assist with the evaluation of various strategic alternatives to address our liquidity and capital structure (see Note 12 – Restructuring Fees) . On October 20, 2016, we entered into a restructuring support agreement (the “RSA”) with certain holders of our 2017 Convertible Notes and our 2022 Notes (the "Noteholders") to support a restructuring on the terms of a pre-packaged plan of reorganization (the “Plan”). The RSA contemplates that we will file for voluntary relief under chapter 11 of the United States Bankruptcy Code (the "Bankruptcy Code") in a United States Bankruptcy Court (the "Bankruptcy Court") on or before December 9, 2016 to implement the Plan. Pursuant to the terms of the RSA, the Noteholders will receive (a) 95% of the common stock in reorganized Stone, (b) $225 million of new 7.5% second lien notes due 2022 and (c) $150 million of the net cash proceeds from the sale of Stone’s approximately 86,000 net acres in the Appalachia regions of Pennsylvania and West Virginia (the “Properties”) plus 85% of the net cash proceeds from the sale of the Properties in excess of $350 million , if any. Additionally, on October 20, 2016, we entered into a purchase and sale agreement (the “PSA”) with TH Exploration III, LLC, an affiliate of Tug Hill, Inc. (“Tug Hill”). Pursuant to the terms of the PSA, we agreed to sell the Properties to Tug Hill for $360 million in cash, subject to customary purchase price adjustments. The consummation of the Plan will be subject to customary conditions and other requirements, as well as the sale by Stone of the Properties for a cash purchase price of at least $350 million and approval of the Bankruptcy Court. On November 4, 2016, we entered into an amendment to the RSA (the “RSA Amendment”) with the Noteholders pursuant to which (a) Stone will be obligated to, at any time upon the written request of the Noteholders or their counsel, provide in writing to counsel to the Noteholders the good faith estimate of Stone – together with documentation requested by the Noteholders or their counsel – of any cure amounts or other payment obligations of Stone arising or resulting from the assumption of executory contracts or unexpired leases on both a “per contract” basis and in the aggregate, (b) the Noteholders will have the option to terminate the RSA at any time that the Noteholders determine, in their sole discretion, that the total amount of all such payments exceeds an amount acceptable to the Noteholders, (c) the Noteholders will have the unilateral right to extend the automatic termination of the RSA if the restructuring transactions contemplated by the RSA are not consummated by the one-hundredth (100th) calendar day after the Company files for chapter 11 bankruptcy, and (d) solicitation will commence by November 10, 2016. For additional details on the RSA, RSA Amendment and PSA, see Note 16 – Subsequent Events . We cannot provide any assurances that we will be able to complete a restructuring or asset sales on satisfactory terms to provide the liquidity to restructure or pay down our senior indebtedness. We have been engaged in discussions and have exchanged proposals with the lenders under our bank credit facility with respect to the treatment of the bank credit facility in a chapter 11 proceeding and a related amendment to the bank credit facility; however, no agreement has been reached. While we expect to continue discussions and related negotiations with our bank credit facility lenders, there can be no assurance that an agreement will be reached. The conditions noted above and the uncertainties surrounding the restructuring, asset sales, renegotiation of our bank credit facility and chapter 11 bankruptcy proceedings raise substantial doubt about our ability to continue as a going concern. New York Stock Exchange Compliance On April 29, 2016, we were notified by the New York Stock Exchange (“NYSE”) that we were not in compliance with the NYSE's continued listing requirements, as the average closing price of our shares of common stock had fallen below $1.00 per share over a period of 30 consecutive trading days, which is the minimum average share price for continued listing on the NYSE under Section 802.01C of the NYSE Listed Company Manual. On May 17, 2016, we were notified by the NYSE that our average global market capitalization had been less than $50 million over a consecutive 30 trading-day period at the same time that our stockholders' equity was less than $50 million , which is non-compliant with Section 802.01B of the NYSE Listed Company Manual. At the close of business on June 10, 2016, we effected a 1-for-10 reverse stock split (see Note 1 – Interim Financial Statements ) in order to increase the market price per share of our common stock in order to regain compliance with the NYSE's minimum share price requirement. We were notified on July 1, 2016 that we cured the minimum share price deficiency and that we were no longer considered non-compliant with the $1.00 per share average closing price requirement. We remain non-compliant with the $50 million market capitalization and stockholders' equity requirements. On June 30, 2016, we submitted our 18-month business plan for curing the average market capitalization and stockholders' equity deficiencies to the NYSE. The NYSE accepted the plan on August 4, 2016 and will continue to review the Company on a quarterly basis for compliance with the plan. Upon acceptance of the plan by the NYSE, and after two consecutive quarters of sustained market capitalization above $50 million , we would no longer be non-compliant with the market capitalization and stockholders' equity requirements. During the 18-month cure period, our shares of common stock will continue to be listed and traded on the NYSE, unless we experience other circumstances that subject us to delisting, including an abnormally low market capitalization. If we fail to meet the material aspects of the plan or any of the quarterly milestones, the NYSE will review the circumstances causing the variance and determine whether such variance warrants commencement of suspension and delisting procedures. Upon a delisting from the NYSE, we would commence trading on the OTC Pink. On September 20, 2016, we submitted our quarterly update to the business plan for the second quarter of 2016, and the NYSE notified us that it accepted the quarterly update on September 22, 2016. We expect to submit our third quarter 2016 plan update to the NYSE by mid-December. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2016 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events Restructuring Support Agreement On October 20, 2016, the Company entered into the RSA with the Noteholders to support a restructuring on the terms of the Plan. The RSA contemplates that the Company will file for voluntary relief under chapter 11 of the Bankruptcy Code in a Bankruptcy Court on or before December 9, 2016 to implement the Plan in accordance with the term sheet annexed to the RSA (the “Term Sheet”). The RSA would become effective upon (i) execution by the Company and Noteholders holding, in the aggregate, at least two-thirds of the outstanding aggregate principal amount of the Notes, and (ii) Stone having entered into a PSA for the sale of Properties for a cash purchase price of at least $350 million . Both conditions were satisfied, with Noteholders holding approximately 85.4% of the aggregate principal amount of the Notes executing the RSA and Stone signing the PSA, as indicated below. Pursuant to the terms of the RSA and the Term Sheet, Noteholders and other interest holders will receive treatment under the Plan summarized as follows: • The Noteholders will receive their pro rata share of (a) $150 million of the net cash proceeds from the sale of the Properties plus 85% of the net cash proceeds from the sale of the Properties in excess of $350 million , if any, (b) 95% of the common stock in reorganized Stone and (c) $225 million of new 7.5% second lien notes due 2022. • Existing common stockholders of Stone will receive their pro rata share of 5% of the common stock in reorganized Stone and warrants for up to 15% of the post-petition equity exercisable upon the Company reaching certain benchmarks pursuant to the terms of the proposed new warrants. • All claims of creditors with unsecured claims other than claims by the Noteholders, including vendors, shall be unaltered and will be paid in full in the ordinary course of business to the extent such claims are undisputed. Stone estimates that such unsecured claims are in the range of approximately $17 million to $27 million in the aggregate. • Holders of claims arising on account of Stone’s existing revolving credit facility will receive (a)(i) if such holders vote, as a class, to accept the Plan, commitments on terms set forth on Exhibit 1(a) to the Term Sheet, on a pro rata basis, under an amended revolving credit facility, or (ii) if such holders, as a class, do not vote to accept the Plan (or are deemed to reject the Plan), a term loan on terms set forth on Exhibit 1(b) to the Term Sheet, or (b) such other treatment as is acceptable to the Company and the Noteholders and consistent with the Bankruptcy Code, including, but not limited to, section 1129(b) of the Bankruptcy Code. Each of the foregoing common equity percentages in reorganized Stone is subject to dilution from the exercise of the new warrants described above and a management incentive plan. The Company has been engaged in discussions and has exchanged proposals with the lenders under its bank credit facility with respect to the treatment of the bank credit facility in a chapter 11 proceeding and a related amendment to the bank credit facility; however, no agreement has been reached. While the Company expects to continue discussions and related negotiations with the lenders under its bank credit facility, there can be no assurance that an agreement will be reached. The RSA contains certain covenants on the part of the Company and the Noteholders who are signatories to the RSA, including that such Noteholders will vote in favor of the Plan, support the sale of the Properties and otherwise facilitate the restructuring transaction, in each case subject to certain terms and conditions in the RSA. The consummation of the Plan will be subject to customary conditions and other requirements, as well as the sale by Stone of the Properties for a cash purchase price of at least $350 million and approval of the Bankruptcy Court. The RSA also provides for termination by each party, or by either party, upon the occurrence of certain events, including without limitation, termination by the Noteholders upon the failure of the Company to achieve certain milestones set forth in Schedule 1 to the RSA. Assuming implementation of the Plan, Stone expects that it will eliminate approximately $850 million in principal of outstanding debt and reduce its annual interest payment burden by approximately $46 million . On November 4, 2016 the Company and the Noteholders entered into the RSA Amendment pursuant to which: • Stone will be obligated to, at any time upon the written request of the Noteholders or their counsel, provide in writing to counsel to the Noteholders the good faith estimate of Stone – together with documentation requested by the Noteholders or their counsel – of any cure amounts or other payment obligations of Stone arising or resulting from the assumption of executory contracts or unexpired leases on both a “per contract” basis and in the aggregate; • The Noteholders will have the option to terminate the RSA at any time that the Noteholders determine, in their sole discretion, that the total amount of all such payments exceeds an amount acceptable to the Noteholders; • The Noteholders will have the unilateral right to extend the automatic termination of the RSA if the restructuring transactions contemplated by the RSA are not consummated by the one-hundredth (100th) calendar day after the Company files for chapter 11 bankruptcy; and • Solicitation of noteholders in support of the Plan will commence by November 10, 2016. Although the Company intends to pursue the restructuring in accordance with the terms set forth in the RSA and the RSA Amendment, there can be no assurance that the Company will be successful in completing a restructuring or any other similar transaction on the terms set forth in the RSA and the RSA Amendment, on different terms or at all. Purchase and Sale Agreement On October 20, 2016 (the “Execution Date”), Stone entered into the PSA with Tug Hill. Pursuant to the terms of the PSA, Stone agreed to sell the Properties to Tug Hill (the “Disposition”) for $360 million in cash, subject to customary purchase price adjustments (the “Purchase Price”). The Disposition has an effective date of June 1, 2016. In connection with the execution of the PSA, Tug Hill deposited $5.0 million in escrow, which amount may be supplemented by an additional $31 million at a later date on certain conditions being met. Upon a closing, the deposit will be credited against the Purchase Price. From the Execution Date through December 19, 2016 (the “Diligence Period”), Tug Hill intends to conduct customary due diligence to assess the aggregate dollar value of any title and environmental defects associated with the Properties. The parties expect to close the Disposition by February 25, 2017, subject to customary closing conditions and approval by the Bankruptcy Court. The PSA contains customary representations, warranties and covenants. From and after the closing of the Disposition, Stone and Tug Hill, respectively, have agreed to indemnify each other and their respective affiliates against certain losses resulting from any breach of their representations, warranties or covenants contained in the PSA, subject to certain customary limitations and survival periods. Additionally, from and after closing of the Disposition, Stone has agreed to indemnify Tug Hill for certain identified retained liabilities related to the Properties, subject to certain survival periods, and Tug Hill has agreed to indemnify Stone for certain assumed obligations related to the Properties. The PSA may be terminated, subject to certain exceptions, (i) upon mutual written consent, (ii) if the closing has not occurred by March 1, 2017, (iii) for certain material breaches of representations and warranties or covenants that remain uncured, (iv) if, on or prior to the end of the Diligence Period, title and environmental defect amounts (after application of customary thresholds and deductibles), casualty losses and the value of any assets excluded from the Properties due to the exercise of preferential purchase rights or consents equal or exceed $10 million in the aggregate, (v) if Stone fails to file for bankruptcy on or before December 9, 2016, (vi) if the Bankruptcy Court does not enter an order approving Stone’s assumption of the PSA and certain other matters within 30 days of Stone filing for bankruptcy, (vii) if the Bankruptcy Court does not enter a sale order for the Disposition by February 10, 2017, and (viii) upon the occurrence of certain other events specified in the PSA. |
Guarantor Financial Statements
Guarantor Financial Statements | 9 Months Ended |
Sep. 30, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Guarantor Financial Statements | Guarantor Financial Statements Stone Offshore is an unconditional guarantor (the "Guarantor Subsidiary") of the 2017 Convertible Notes and the 2022 Notes. Our other subsidiaries (the “Non-Guarantor Subsidiaries”) have not provided guarantees. The following presents unaudited condensed consolidating financial information as of September 30, 2016 and December 31, 2015 and for the three and nine month periods ended September 30, 2016 and 2015 on an issuer (parent company), Guarantor Subsidiary, Non-Guarantor Subsidiaries and consolidated basis. Elimination entries presented are necessary to combine the entities. CONDENSED CONSOLIDATING BALANCE SHEET SEPTEMBER 30, 2016 (In thousands) Parent Guarantor Subsidiary Non- Guarantor Subsidiaries Eliminations Consolidated Assets Current assets: Cash and cash equivalents $ 152,384 $ 30,015 $ — $ — $ 182,399 Accounts receivable 17,336 40,736 883 (14,892 ) 44,063 Fair value of derivative contracts — 6,261 — — 6,261 Current income tax receivable 19,863 — — — 19,863 Other current assets 11,176 — — — 11,176 Total current assets 200,759 77,012 883 (14,892 ) 263,762 Oil and gas properties, full cost method: Proved 1,932,435 7,586,930 45,196 — 9,564,561 Less: accumulated DD&A (1,932,640 ) (7,076,233 ) (45,196 ) — (9,054,069 ) Net proved oil and gas properties (205 ) 510,697 — — 510,492 Unevaluated 261,101 143,125 — — 404,226 Other property and equipment, net 27,227 — — — 27,227 Other assets, net 28,852 948 — — 29,800 Investment in subsidiary 480,971 — — (480,971 ) — Total assets $ 998,705 $ 731,782 $ 883 $ (495,863 ) $ 1,235,507 Liabilities and Stockholders’ Equity Current liabilities: Accounts payable to vendors $ 35,189 $ 8,963 $ — $ (14,893 ) $ 29,259 Undistributed oil and gas proceeds 6,535 904 — — 7,439 Accrued interest 22,917 — — — 22,917 Asset retirement obligations — 60,223 — — 60,223 Current portion of long-term debt 292,795 — — — 292,795 Other current liabilities 10,778 125 — — 10,903 Total current liabilities 368,214 70,215 — (14,893 ) 423,536 Long-term debt 1,122,945 — — — 1,122,945 Asset retirement obligations 1,336 181,480 — — 182,816 Other long-term liabilities 25,871 — — — 25,871 Total liabilities 1,518,366 251,695 — (14,893 ) 1,755,168 Commitments and contingencies Stockholders’ equity: Common stock 56 — — — 56 Treasury stock (860 ) — — — (860 ) Additional paid-in capital 1,657,028 1,344,577 109,079 (1,453,656 ) 1,657,028 Accumulated deficit (2,179,803 ) (868,408 ) (108,196 ) 976,604 (2,179,803 ) Accumulated other comprehensive income 3,918 3,918 — (3,918 ) 3,918 Total stockholders’ equity (519,661 ) 480,087 883 (480,970 ) (519,661 ) Total liabilities and stockholders’ equity $ 998,705 $ 731,782 $ 883 $ (495,863 ) $ 1,235,507 CONDENSED CONSOLIDATING BALANCE SHEET DECEMBER 31, 2015 (In thousands) Parent Guarantor Subsidiary Non- Guarantor Subsidiaries Eliminations Consolidated Assets Current assets: Cash and cash equivalents $ 9,681 $ 2 $ 1,076 $ — $ 10,759 Accounts receivable 10,597 39,190 — (1,756 ) 48,031 Fair value of derivative contracts — 38,576 — — 38,576 Current income tax receivable 46,174 — — — 46,174 Other current assets 6,848 — 33 — 6,881 Total current assets 73,300 77,768 1,109 (1,756 ) 150,421 Oil and gas properties, full cost method: Proved 1,875,152 7,458,262 42,484 — 9,375,898 Less: accumulated DD&A (1,874,622 ) (6,686,849 ) (42,484 ) — (8,603,955 ) Net proved oil and gas properties 530 771,413 — — 771,943 Unevaluated 253,308 186,735 — — 440,043 Other property and equipment, net 29,289 — — — 29,289 Other assets, net 16,612 826 1,035 — 18,473 Investment in subsidiary 745,033 — 1,088 (746,121 ) — Total assets $ 1,118,072 $ 1,036,742 $ 3,232 $ (747,877 ) $ 1,410,169 Liabilities and Stockholders’ Equity Current liabilities: Accounts payable to vendors $ 16,063 $ 67,901 $ — $ (1,757 ) $ 82,207 Undistributed oil and gas proceeds 5,216 776 — — 5,992 Accrued interest 9,022 — — — 9,022 Asset retirement obligations — 20,400 891 — 21,291 Other current liabilities 40,161 551 — — 40,712 Total current liabilities 70,462 89,628 891 (1,757 ) 159,224 Long-term debt 1,060,955 — — — 1,060,955 Asset retirement obligations 1,240 203,335 — — 204,575 Other long-term liabilities 25,204 — — — 25,204 Total liabilities 1,157,861 292,963 891 (1,757 ) 1,449,958 Commitments and contingencies Stockholders’ equity: Common stock 55 — — — 55 Treasury stock (860 ) — — — (860 ) Additional paid-in capital 1,648,687 1,344,577 109,795 (1,454,372 ) 1,648,687 Accumulated deficit (1,705,623 ) (624,824 ) (95,306 ) 720,130 (1,705,623 ) Accumulated other comprehensive income (loss) 17,952 24,026 (12,148 ) (11,878 ) 17,952 Total stockholders’ equity (39,789 ) 743,779 2,341 (746,120 ) (39,789 ) Total liabilities and stockholders’ equity $ 1,118,072 $ 1,036,742 $ 3,232 $ (747,877 ) $ 1,410,169 CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS THREE MONTHS ENDED SEPTEMBER 30, 2016 (In thousands) Parent Guarantor Non- Eliminations Consolidated Operating revenue: Oil production $ 3,587 $ 67,529 $ — $ — $ 71,116 Natural gas production 7,216 8,385 — — 15,601 Natural gas liquids production 5,737 929 — — 6,666 Other operational income 1,044 — — — 1,044 Total operating revenue 17,584 76,843 — — 94,427 Operating expenses: Lease operating expenses 2,771 14,205 — — 16,976 Transportation, processing and gathering expenses 9,607 1,026 — — 10,633 Production taxes 669 166 — — 835 Depreciation, depletion and amortization 26,388 32,530 — — 58,918 Write-down of oil and gas properties 1 36,483 — — 36,484 Accretion expense 58 10,024 — — 10,082 Salaries, general and administrative expenses 15,425 — — — 15,425 Incentive compensation expense 2,160 — — — 2,160 Restructuring fees 5,784 — — — 5,784 Other operational expenses 9,214 (155 ) — — 9,059 Derivative expense, net — 199 — — 199 Total operating expenses 72,077 94,478 — — 166,555 Loss from operations (54,493 ) (17,635 ) — — (72,128 ) Other (income) expenses: Interest expense 16,924 — — — 16,924 Interest income (43 ) (15 ) — — (58 ) Other income (64 ) (208 ) — — (272 ) Other expense 16 — — — 16 Loss from investment in subsidiaries 19,300 — 1 (19,301 ) — Total other (income) expenses 36,133 (223 ) 1 (19,301 ) 16,610 Loss before taxes (90,626 ) (17,412 ) (1 ) 19,301 (88,738 ) Provision (benefit) for income taxes: Current (991 ) — — — (991 ) Deferred — 1,888 — — 1,888 Total income taxes (991 ) 1,888 — — 897 Net loss $ (89,635 ) $ (19,300 ) $ (1 ) $ 19,301 $ (89,635 ) Comprehensive loss $ (93,102 ) $ (19,300 ) $ (1 ) $ 19,301 $ (93,102 ) CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS THREE MONTHS ENDED SEPTEMBER 30, 2015 (In thousands) Parent Guarantor Subsidiary Non- Guarantor Subsidiaries Eliminations Consolidated Operating revenue: Oil production $ 1,633 $ 103,380 $ — $ — $ 105,013 Natural gas production 7,111 10,256 — — 17,367 Natural gas liquids production 3,502 2,478 — — 5,980 Other operational income 1,392 — — — 1,392 Derivative income, net — 2,444 — — 2,444 Total operating revenue 13,638 118,558 — — 132,196 Operating expenses: Lease operating expenses 2,680 21,562 2 — 24,244 Transportation, processing and gathering expenses 13,697 4,511 — — 18,208 Production taxes 1,777 275 — — 2,052 Depreciation, depletion and amortization 27,518 34,418 — — 61,936 Write-down of oil and gas properties 295,679 — — — 295,679 Accretion expense 92 6,406 — — 6,498 Salaries, general and administrative expenses 19,348 200 4 — 19,552 Incentive compensation expense 794 — — — 794 Other operational expenses 142 300 — — 442 Total operating expenses 361,727 67,672 6 — 429,405 Income (loss) from operations (348,089 ) 50,886 (6 ) — (297,209 ) Other (income) expenses: Interest expense 10,871 1 — — 10,872 Interest income (39 ) (7 ) (1 ) — (47 ) Other income (117 ) (294 ) — — (411 ) Other expense 148 — — — 148 (Income) loss from investment in subsidiaries (227,973 ) — 16,272 211,701 — Total other (income) expenses (217,110 ) (300 ) 16,271 211,701 10,562 Income (loss) before taxes (130,979 ) 51,186 (16,277 ) (211,701 ) (307,771 ) Provision (benefit) for income taxes: Deferred 160,986 (193,059 ) 16,267 — (15,806 ) Total income taxes 160,986 (193,059 ) 16,267 — (15,806 ) Net income (loss) $ (291,965 ) $ 244,245 $ (32,544 ) $ (211,701 ) $ (291,965 ) Comprehensive income (loss) $ (297,564 ) $ 244,245 $ (32,544 ) $ (211,701 ) $ (297,564 ) CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS NINE MONTHS ENDED SEPTEMBER 30, 2016 (In thousands) Parent Guarantor Non- Eliminations Consolidated Operating revenue: Oil production $ 4,971 $ 199,131 $ — $ — $ 204,102 Natural gas production 13,642 29,685 — — 43,327 Natural gas liquids production 9,246 5,873 — — 15,119 Other operational income 1,737 — — — 1,737 Total operating revenue 29,596 234,689 — — 264,285 Operating expenses: Lease operating expenses 9,313 46,023 13 — 55,349 Transportation, processing and gathering expenses 17,174 1,483 — — 18,657 Production taxes 1,311 583 — — 1,894 Depreciation, depletion and amortization 45,452 121,255 — — 166,707 Write-down of oil and gas properties 15,859 268,128 350 — 284,337 Accretion expense 174 29,973 — — 30,147 Salaries, general and administrative expenses 48,392 (199 ) — — 48,193 Incentive compensation expense 11,809 — — — 11,809 Restructuring fees 16,173 — — — 16,173 Other operational expenses 43,059 125 6,082 — 49,266 Derivative expense, net — 687 — — 687 Total operating expenses 208,716 468,058 6,445 — 683,219 Loss from operations (179,120 ) (233,369 ) (6,445 ) — (418,934 ) Other (income) expenses: Interest expense 49,764 — — — 49,764 Interest income (459 ) (15 ) — — (474 ) Other income (123 ) (717 ) — — (840 ) Other expense 27 — — — 27 Loss from investment in subsidiaries 250,029 — 6,445 (256,474 ) — Total other (income) expenses 299,238 (732 ) 6,445 (256,474 ) 48,477 Loss before taxes (478,358 ) (232,637 ) (12,890 ) 256,474 (467,411 ) Provision (benefit) for income taxes: Current (4,178 ) — — — (4,178 ) Deferred — 10,947 — — 10,947 Total income taxes (4,178 ) 10,947 — — 6,769 Net loss $ (474,180 ) $ (243,584 ) $ (12,890 ) $ 256,474 $ (474,180 ) Comprehensive loss $ (488,214 ) $ (243,584 ) $ (12,890 ) $ 256,474 $ (488,214 ) CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS NINE MONTHS ENDED SEPTEMBER 30, 2015 (In thousands) Parent Guarantor Subsidiary Non- Guarantor Subsidiaries Eliminations Consolidated Operating revenue: Oil production $ 12,487 $ 311,618 $ — $ — $ 324,105 Natural gas production 39,375 33,236 — — 72,611 Natural gas liquids production 21,458 7,921 — — 29,379 Other operational income 3,184 — — — 3,184 Derivative income, net — 4,871 — — 4,871 Total operating revenue 76,504 357,646 — — 434,150 Operating expenses: Lease operating expenses 12,767 66,481 2 — 79,250 Transportation, processing and gathering expenses 47,779 8,072 — — 55,851 Production taxes 5,411 983 — — 6,394 Depreciation, depletion and amortization 113,682 112,627 — — 226,309 Write-down of oil and gas properties 966,216 — 45,169 — 1,011,385 Accretion expense 274 19,041 — — 19,315 Salaries, general and administrative expenses 52,747 201 29 — 52,977 Incentive compensation expense 3,621 — — — 3,621 Other operational expenses 1,312 300 — — 1,612 Total operating expenses 1,203,809 207,705 45,200 — 1,456,714 Income (loss) from operations (1,127,305 ) 149,941 (45,200 ) — (1,022,564 ) Other (income) expenses: Interest expense 31,687 22 — — 31,709 Interest income (186 ) (42 ) (7 ) — (235 ) Other income (437 ) (727 ) (3 ) — (1,167 ) Other expense 148 — — — 148 (Income) loss from investment in subsidiaries (273,147 ) — 45,190 227,957 — Total other (income) expenses (241,935 ) (747 ) 45,180 227,957 30,455 Income (loss) before taxes (885,370 ) 150,688 (90,380 ) (227,957 ) (1,053,019 ) Provision (benefit) for income taxes: Deferred (113,111 ) (167,649 ) — — (280,760 ) Total income taxes (113,111 ) (167,649 ) — — (280,760 ) Net income (loss) $ (772,259 ) $ 318,337 $ (90,380 ) $ (227,957 ) $ (772,259 ) Comprehensive income (loss) $ (820,517 ) $ 318,337 $ (90,380 ) $ (227,957 ) $ (820,517 ) CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS NINE MONTHS ENDED SEPTEMBER 30, 2016 (In thousands) Parent Guarantor Subsidiary Non-Guarantor Subsidiaries Eliminations Consolidated Cash flows from operating activities: Net loss $ (474,180 ) $ (243,584 ) $ (12,890 ) $ 256,474 $ (474,180 ) Adjustments to reconcile net loss to net cash provided by operating activities: Depreciation, depletion and amortization 45,452 121,255 — — 166,707 Write-down of oil and gas properties 15,859 268,128 350 — 284,337 Accretion expense 174 29,973 — — 30,147 Deferred income tax provision — 10,947 — — 10,947 Settlement of asset retirement obligations (78 ) (14,129 ) (899 ) — (15,106 ) Non-cash stock compensation expense 6,407 — — — 6,407 Non-cash derivative expense — 1,261 — — 1,261 Non-cash interest expense 14,278 — — — 14,278 Other non-cash expense — — 6,081 — 6,081 Change in current income taxes 21,584 — — — 21,584 Non-cash loss from investment in subsidiaries 250,029 — 6,445 (256,474 ) — Change in intercompany receivables/payables (1,658 ) 1,658 — — — (Increase) decrease in accounts receivable 7,966 (3,116 ) (882 ) — 3,968 (Increase) decrease in other current assets (4,459 ) — 33 — (4,426 ) Increase (decrease) in accounts payable 7,385 (4,168 ) — — 3,217 Decrease in other current liabilities (13,924 ) (298 ) — — (14,222 ) Other (7,389 ) (718 ) — — (8,107 ) Net cash (used in) provided by operating activities (132,554 ) 167,209 (1,762 ) — 32,893 Cash flows from investing activities: Investment in oil and gas properties (63,075 ) (137,196 ) (351 ) — (200,622 ) Investment in fixed and other assets (1,231 ) — — — (1,231 ) Change in restricted funds — — 1,046 — 1,046 Investment in subsidiaries — — 716 (716 ) — Net cash (used in) provided by investing activities (64,306 ) (137,196 ) 1,411 (716 ) (200,807 ) Cash flows from financing activities: Proceeds from bank borrowings 477,000 — — — 477,000 Repayments of bank borrowings (135,500 ) — — — (135,500 ) Repayments of building loan (285 ) — — — (285 ) Deferred financing costs (900 ) — — — (900 ) Equity proceeds from parent — — (716 ) 716 — Net payments for share-based compensation (752 ) — — — (752 ) Net cash provided by (used in) financing activities 339,563 — (716 ) 716 339,563 Effect of exchange rate changes on cash — — (9 ) — (9 ) Net change in cash and cash equivalents 142,703 30,013 (1,076 ) — 171,640 Cash and cash equivalents, beginning of period 9,681 2 1,076 — 10,759 Cash and cash equivalents, end of period $ 152,384 $ 30,015 $ — $ — $ 182,399 CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS NINE MONTHS ENDED SEPTEMBER 30, 2015 (In thousands) Parent Guarantor Subsidiary Non-Guarantor Subsidiaries Eliminations Consolidated Cash flows from operating activities: Net income (loss) $ (772,259 ) $ 318,337 $ (90,380 ) $ (227,957 ) $ (772,259 ) Adjustments to reconcile net income (loss) to net cash provided by operating activities: Depreciation, depletion and amortization 113,682 112,627 — — 226,309 Write-down of oil and gas properties 966,216 — 45,169 — 1,011,385 Accretion expense 274 19,041 — — 19,315 Deferred income tax benefit (113,111 ) (167,649 ) — — (280,760 ) Settlement of asset retirement obligations (15 ) (59,811 ) — — (59,826 ) Non-cash stock compensation expense 9,163 — — — 9,163 Non-cash derivative expense — 10,854 — — 10,854 Non-cash interest expense 13,210 — — — 13,210 Change in current income taxes 7,211 — — — 7,211 Non-cash (income) expense from investment in subsidiaries (273,147 ) — 45,190 227,957 — Change in intercompany receivables/payables 31,320 (41,056 ) 9,736 — — Decrease in accounts receivable 29,561 4,317 17 — 33,895 Increase in other current assets (1,050 ) — (40 ) — (1,090 ) (Increase) decrease in inventory (2,415 ) 2,415 — — — Decrease in accounts payable (7,562 ) (4,030 ) — — (11,592 ) Increase (decrease) in other current liabilities (6,855 ) 102 — — (6,753 ) Other 645 (727 ) — — (82 ) Net cash (used in) provided by operating activities (5,132 ) 194,420 9,692 — 198,980 Cash flows from investing activities: Investment in oil and gas properties (177,497 ) (197,471 ) (10,560 ) — (385,528 ) Proceeds from sale of oil and gas properties, net of expenses — 11,643 — — 11,643 Investment in fixed and other assets (1,455 ) — — — (1,455 ) Change in restricted funds 177,647 — 1,828 — 179,475 Investment in subsidiaries — — (9,708 ) 9,708 — Net cash used in investing activities (1,305 ) (185,828 ) (18,440 ) 9,708 (195,865 ) Cash flows from financing activities: Proceeds from bank borrowings 5,000 — — — 5,000 Repayments of bank borrowings (5,000 ) — — — (5,000 ) Equity proceeds from parent — — 9,708 (9,708 ) — Net payments for share-based compensation (3,127 ) — — — (3,127 ) Net cash (used in) provided by financing activities (3,127 ) — 9,708 (9,708 ) (3,127 ) Effect of exchange rate changes on cash — — (2 ) — (2 ) Net change in cash and cash equivalents (9,564 ) 8,592 958 — (14 ) Cash and cash equivalents, beginning of period 72,886 1,450 152 — 74,488 Cash and cash equivalents, end of period $ 63,322 $ 10,042 $ 1,110 $ — $ 74,474 |
Interim Financial Statements (P
Interim Financial Statements (Policies) | 9 Months Ended |
Sep. 30, 2016 | |
Accounting Policies [Abstract] | |
Basis of Presentation | The condensed consolidated financial statements of Stone Energy Corporation (“Stone” or the "Company") and its subsidiaries as of September 30, 2016 and for the three and nine month periods ended September 30, 2016 and 2015 are unaudited and reflect all adjustments (consisting only of normal recurring adjustments), which are, in the opinion of management, necessary for a fair presentation of the financial position and operating results for the interim periods. The condensed consolidated balance sheet as of December 31, 2015 has been derived from the audited financial statements as of that date contained in our Annual Report on Form 10-K for the year ended December 31, 2015 (our “ 2015 Annual Report on Form 10-K”). The condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto, together with management’s discussion and analysis of financial condition and results of operations, contained in our 2015 Annual Report on Form 10-K. The results of operations for the three and nine month periods ended September 30, 2016 are not necessarily indicative of future financial results. Certain prior period amounts have been reclassified to conform to current period presentation. |
Earning Per Share | For the three and nine months ended September 30, 2016 and 2015 , the 2017 Convertible Notes had no dilutive effect on the diluted earnings per share computation as we had net losses for such periods. For the three and nine months ended September 30, 2016 and 2015 , the average price of our common stock was less than the strike price of the Sold Warrants (as defined in Note 5 – Debt ) and therefore, such warrants were not dilutive for such periods. Based on the terms of the Purchased Call Options (as defined in Note 5 – Debt ), such call options are antidilutive and therefore were not included in the calculation of diluted earnings per share. |
Derivative Instruments and Hedging Activities | Our hedging strategy is designed to protect our near and intermediate term cash flows from future declines in oil and natural gas prices. This protection is essential to capital budget planning, which is sensitive to expenditures that must be committed to in advance, such as rig contracts and the purchase of tubular goods. We enter into derivative transactions to secure a commodity price for a portion of our expected future production that is acceptable at the time of the transaction. These derivatives are generally designated as cash flow hedges upon entering into the contracts. We do not enter into derivative transactions for trading purposes. We have no fair value hedges. The nature of a derivative instrument must be evaluated to determine if it qualifies as a hedging instrument. If the instrument qualifies as a hedging instrument, it is recorded as either an asset or liability measured at fair value and subsequent changes in the derivative’s fair value are recognized in stockholders’ equity through other comprehensive income (loss), net of related taxes, to the extent the hedge is considered effective. Monthly settlements of effective hedges are reflected in revenue from oil and natural gas production and cash flows from operating activities. Instruments not qualifying as hedging instruments are recorded in our balance sheet at fair value and subsequent changes in fair value are recognized in earnings through derivative expense (income). Monthly settlements of ineffective hedges and derivative instruments not qualifying as hedging instruments are recognized in earnings through derivative expense (income) and cash flows from operating activities. We have entered into fixed-price swaps and collars with various counterparties for a portion of our expected 2016 oil and natural gas production from the Gulf Coast Basin. Our fixed-price oil swap settlements and oil collar settlements are based on an average of the New York Mercantile Exchange (“NYMEX”) closing price for West Texas Intermediate crude oil during the entire calendar month. Our fixed-price gas swap settlements are based on the NYMEX price for the last day of a respective contract month. Swaps typically provide for monthly payments by us if prices rise above the swap price or monthly payments to us if prices fall below the swap price. Collar contracts typically require payments by us if the NYMEX average closing price is above the ceiling price or payments to us if the NYMEX average closing price is below the floor price. Our fixed-price swap contracts are with The Toronto-Dominion Bank, The Bank of Nova Scotia and Natixis. Our oil collar contract is with The Bank of Nova Scotia. All of our derivative transactions have been carried out in the over-the-counter market and are not typically subject to margin-deposit requirements. The use of derivative instruments involves the risk that the counterparties will be unable to meet the financial terms of such transactions. The counterparties to all of our derivative instruments have an "investment grade" credit rating. We monitor the credit ratings of our derivative counterparties on an ongoing basis. Although we have entered into derivative contracts with multiple counterparties to mitigate our exposure to any individual counterparty, if any of our counterparties were to default on its obligations to us under the derivative contracts or seek bankruptcy protection, we may not realize the benefit of some of our derivative instruments and incur a loss. |
Fair Value Measurements | U.S. Generally Accepted Accounting Principles establish a fair value hierarchy that has three levels based on the reliability of the inputs used to determine the fair value. These levels include: Level 1, defined as inputs such as unadjusted quoted prices in active markets for identical assets or liabilities; Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable; and Level 3, defined as unobservable inputs for use when little or no market data exists, therefore requiring an entity to develop its own assumptions. As of September 30, 2016 and December 31, 2015 , we held certain financial assets that are required to be measured at fair value on a recurring basis, including our commodity derivative instruments and our investments in marketable securities. We utilize the services of an independent third party to assist us in valuing our derivative instruments. We used the income approach in determining the fair value of our derivative instruments utilizing a proprietary pricing model. The model accounts for our credit risk and the credit risk of our counterparties in the discount rate applied to estimated future cash inflows and outflows. Our swap contracts are included within the Level 2 fair value hierarchy, and our collar contracts are included within the Level 3 fair value hierarchy. Significant unobservable inputs used in establishing fair value for the collars were the volatility impacts in the pricing model as it relates to the call portion of the collar. For a more detailed description of our derivative instruments, see Note 4 – Derivative Instruments and Hedging Activities . We used the market approach in determining the fair value of our investments in marketable securities, which are included within the Level 1 fair value hierarchy. |
Recently Issued Accounting Standards | In February 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2016-02, " Leases (Topic 842) " to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. The standard is effective for public entities for fiscal years beginning after December 15, 2018, and for interim periods within those fiscal years, with earlier application permitted. Upon adoption the lessee will apply the new standard retrospectively to all periods presented or retrospectively using a cumulative effect adjustment in the year of adoption. We are currently evaluating the effect that this new standard may have on our financial statements. In March 2016, the FASB issued ASU 2016-09, " Compensation – Stock Compensation (Topic 718) " to simplify several aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and forfeitures, as well as classification in the statement of cash flows. The standard is effective for public entities for fiscal years beginning after December 15, 2016, and for interim periods within those fiscal years. Early adoption is permitted for any entity in any interim or annual period. An entity that elects early adoption must adopt all of the amendments in ASU 2016-09 in the same period. We are currently evaluating the effect that this new standard may have on our financial statements, but we do not anticipate the implementation of this new standard will have a material effect. In August 2016, the FASB issued ASU 2016-15, " Statement of Cash Flows (Topic 230), Classification of Certain Cash Receipts and Cash Payments " to reduce diversity in practice in how certain cash receipts and cash payments are presented and classified in the statement of cash flows. The standard is effective for public entities for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. Early adoption is permitted for any entity in any interim or annual period. An entity that elects early adoption must adopt all of the amendments in ASU 2016-15 in the same period, and any adjustments should be reflected as of the beginning of the fiscal year that includes that interim period. We are currently evaluating the effect that this new standard may have on our financial statements, but we do not anticipate the implementation of this new standard will have a material effect. |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Earnings Per Share [Abstract] | |
Calculation of Basic and Diluted Weighted Average Shares Outstanding Earnings Per Share | The following table sets forth the calculation of basic and diluted weighted average shares outstanding and earnings per share for the indicated periods: Three Months Ended Nine Months Ended 2016 2015 2016 2015 (In thousands, except per share data) Income (numerator): Basic: Net loss $ (89,635 ) $ (291,965 ) $ (474,180 ) $ (772,259 ) Net income attributable to participating securities — — — — Net loss attributable to common stock - basic $ (89,635 ) $ (291,965 ) $ (474,180 ) $ (772,259 ) Diluted: Net loss $ (89,635 ) $ (291,965 ) $ (474,180 ) $ (772,259 ) Net income attributable to participating securities — — — — Net loss attributable to common stock - diluted $ (89,635 ) $ (291,965 ) $ (474,180 ) $ (772,259 ) Weighted average shares (denominator): Weighted average shares - basic 5,600 5,528 5,585 5,523 Dilutive effect of stock options — — — — Dilutive effect of convertible notes — — — — Weighted average shares - diluted 5,600 5,528 5,585 5,523 Basic loss per share $ (16.01 ) $ (52.82 ) $ (84.90 ) $ (139.83 ) Diluted loss per share $ (16.01 ) $ (52.82 ) $ (84.90 ) $ (139.83 ) |
Derivative Instruments and He26
Derivative Instruments and Hedging Activities (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Hedging Positions | The following tables illustrate our derivative positions for calendar year 2016 as of November 7, 2016 : Fixed-Price Swaps (NYMEX) Natural Gas Oil Daily Volume (MMBtus/d) Swap Price ($) Daily Volume (Bbls/d) Swap Price ($) 2016 10,000 4.110 1,000 49.75 2016 10,000 4.120 1,000 52.78 2016 1,000 90.00 Collar (NYMEX) Oil Daily Volume (Bbls/d) Floor Price ($) Ceiling Price ($) 2016 1,000 45.00 54.75 |
Location and Fair Value Amounts of Derivative Instruments Reported in Balance Sheet | The following tables disclose the location and fair value amounts of derivatives qualifying as hedging instruments, as reported in our balance sheet, at September 30, 2016 and December 31, 2015 . Fair Value of Derivatives Qualifying as Hedging Instruments at September 30, 2016 (In millions) Asset Derivatives Liability Derivatives Description Balance Sheet Location Fair Value Balance Sheet Location Fair Value Commodity contracts Current assets: Fair value of derivative contracts $ 6.3 Current liabilities: Fair value of derivative contracts $ — Long-term assets: Fair value of derivative contracts — Long-term liabilities: Fair value of derivative contracts — $ 6.3 $ — Fair Value of Derivatives Qualifying as Hedging Instruments at December 31, 2015 (In millions) Asset Derivatives Liability Derivatives Description Balance Sheet Location Fair Value Balance Sheet Location Fair Value Commodity contracts Current assets: Fair value of derivative contracts $ 38.6 Current liabilities: Fair value of derivative contracts $ — Long-term assets: Fair value of derivative contracts — Long-term liabilities: Fair value of derivative contracts — $ 38.6 $ — |
Before Tax Effect of Derivative Instruments in Statement of Operations | The following tables disclose the before tax effect of derivatives qualifying as hedging instruments, as reported in the statement of operations, for the three and nine month periods ended September 30, 2016 and 2015 . Effect of Derivatives Qualifying as Hedging Instruments on the Statement of Operations for the Three Months Ended September 30, 2016 and 2015 (In millions) Derivatives in Amount of Gain Gain (Loss) Reclassified from Gain (Loss) Recognized in Income 2016 2015 Location 2016 2015 Location 2016 2015 Commodity contracts $ 2.3 $ 31.6 Operating revenue - oil/natural gas production $ 7.7 $ 39.9 Derivative income (expense), net $ (0.2 ) $ 1.2 Total $ 2.3 $ 31.6 $ 7.7 $ 39.9 $ (0.2 ) $ 1.2 (a) For the three months ended September 30, 2016 , effective hedging contracts increased oil revenue by $5.3 million and increased natural gas revenue by $2.4 million . For the three months ended September 30, 2015 , effective hedging contracts increased oil revenue by $36.3 million and increased natural gas revenue by $3.6 million . Effect of Derivatives Qualifying as Hedging Instruments on the Statement of Operations for the Nine Months Ended September 30, 2016 and 2015 (In millions) Derivatives in Amount of Gain Gain (Loss) Reclassified from Gain (Loss) Recognized in Income 2016 2015 Location 2016 2015 Location 2016 2015 Commodity contracts $ (1.7 ) $ 35.7 Operating revenue - $ 29.4 $ 107.1 Derivative income $ (0.7 ) $ 1.7 Total $ (1.7 ) $ 35.7 $ 29.4 $ 107.1 $ (0.7 ) $ 1.7 (a) For the nine months ended September 30, 2016 , effective hedging contracts increased oil revenue by $19.7 million and increased natural gas revenue by $9.7 million . For the nine months ended September 30, 2015 , effective hedging contracts increased oil revenue by $96.8 million and increased natural gas revenue by $10.3 million . |
Gains or Losses Related to Changes in Fair Value and Cash Settlements on Derivatives Not Qualifying as Hedging Instruments | The following table discloses the before tax effect of our derivatives not qualifying as hedging instruments on the statement of operations, for the three and nine month periods ended September 30, 2016 and 2015 . Gain (Loss) Recognized in Derivative Income (Expense) (In millions) Three Months Ended Nine Months Ended Description 2016 2015 2016 2015 Commodity contracts: Cash settlements $ — $ 3.8 $ — $ 11.0 Change in fair value — (2.6 ) — (7.9 ) Total gains (losses) on non-qualifying hedges $ — $ 1.2 $ — $ 3.1 |
Debt (Tables)
Debt (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Debt Disclosure [Abstract] | |
Long-Term Debt | Our debt balances (net of related unamortized discounts and debt issuance costs) as of September 30, 2016 and December 31, 2015 were as follows: September 30, December 31, (In millions) 1 3 ⁄ 4 % Senior Convertible Notes due 2017 $ 292.4 $ 279.3 7 1 ⁄ 2 % Senior Notes due 2022 770.4 770.0 Revolving credit facility 341.5 — 4.20% Building Loan 11.4 11.7 Total debt 1,415.7 1,061.0 Less: current portion of long-term debt (292.8 ) — Long-term debt $ 1,122.9 $ 1,061.0 |
Asset Retirement Obligations (T
Asset Retirement Obligations (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Asset Retirement Obligation Disclosure [Abstract] | |
Changes in Asset Retirement Obligations | The change in our asset retirement obligations during the nine months ended September 30, 2016 is set forth below: Nine Months Ended (In millions) Asset retirement obligations as of the beginning of the period, including current portion $ 225.9 Liabilities incurred 2.1 Liabilities settled (15.1 ) Accretion expense 30.1 Asset retirement obligations as of the end of the period, including current portion $ 243.0 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Fair Value Disclosures [Abstract] | |
Schedule of Assets and Liabilities Measured at Fair Value Recurring Basis | The following tables present our assets that are measured at fair value on a recurring basis at September 30, 2016 and December 31, 2015. Fair Value Measurements at September 30, 2016 Assets Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) (In millions) Marketable securities (Other assets) $ 8.8 $ 8.8 $ — $ — Derivative contracts 6.3 — 6.3 — Total $ 15.1 $ 8.8 $ 6.3 $ — Fair Value Measurements at December 31, 2015 Assets Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) (In millions) Marketable securities (Other assets) $ 8.5 $ 8.5 $ — $ — Derivative contracts 38.6 — 36.6 2.0 Total $ 47.1 $ 8.5 $ 36.6 $ 2.0 |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation | The table below presents a reconciliation for assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3) during the nine months ended September 30, 2016 . Hedging Contracts, net (In millions) Balance as of January 1, 2016 $ 2.0 Total gains/(losses) (realized or unrealized): Included in earnings 1.1 Included in other comprehensive income (1.9 ) Purchases, sales, issuances and settlements (1.2 ) Transfers in and out of Level 3 — Balance as of September 30, 2016 $ — The amount of total gains/(losses) for the period included in earnings (derivative income) attributable to the change in unrealized gain/(losses) relating to derivatives still held at September 30, 2016 $ — |
Accumulated Other Comprehensi30
Accumulated Other Comprehensive Income (Loss) (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Equity [Abstract] | |
Schedule of Changes in Accumulated Other Comprehensive Income Loss | Changes in accumulated other comprehensive income (loss) for the three and nine months ended September 30, 2016 , were as follows (in millions): Cash Flow Hedges Three Months Ended September 30, 2016 Beginning balance, net of tax $ 7.4 Other comprehensive income (loss) before reclassifications: Change in fair value of derivatives 2.3 Income tax effect (0.8 ) Net of tax 1.5 Amounts reclassified from accumulated other comprehensive income: Operating revenue: oil/natural gas production 7.7 Income tax effect (2.7 ) Net of tax 5.0 Other comprehensive loss, net of tax (3.5 ) Ending balance, net of tax $ 3.9 Cash Flow Hedges Foreign Currency Items Total Nine Months Ended September 30, 2016 Beginning balance, net of tax $ 24.0 $ (6.0 ) $ 18.0 Other comprehensive income (loss) before reclassifications: Change in fair value of derivatives (1.7 ) — (1.7 ) Income tax effect 0.6 — 0.6 Net of tax (1.1 ) — (1.1 ) Amounts reclassified from accumulated other comprehensive income: Operating revenue: oil/natural gas production 29.4 — 29.4 Other operational expenses — (6.0 ) (6.0 ) Income tax effect (10.4 ) — (10.4 ) Net of tax 19.0 (6.0 ) 13.0 Other comprehensive income (loss), net of tax (20.1 ) 6.0 (14.1 ) Ending balance, net of tax $ 3.9 $ — $ 3.9 Changes in accumulated other comprehensive income (loss) for the three and nine months ended September 30, 2015 , were as follows (in millions): Cash Flow Hedges Foreign Currency Items Total Three Months Ended September 30, 2015 Beginning balance, net of tax $ 46.5 $ (5.8 ) $ 40.7 Other comprehensive income (loss) before reclassifications: Change in fair value of derivatives 31.6 — 31.6 Foreign currency translations — (0.2 ) (0.2 ) Income tax effect (11.5 ) — (11.5 ) Net of tax 20.1 (0.2 ) 19.9 Amounts reclassified from accumulated other comprehensive income: Operating revenue: oil/natural gas production 39.9 — 39.9 Income tax effect (14.4 ) — (14.4 ) Net of tax 25.5 — 25.5 Other comprehensive loss, net of tax (5.4 ) (0.2 ) (5.6 ) Ending balance, net of tax $ 41.1 $ (6.0 ) $ 35.1 Cash Flow Foreign Total Nine Months Ended September 30, 2015 Beginning balance, net of tax $ 86.8 $ (3.5 ) $ 83.3 Other comprehensive income (loss) before reclassifications: Change in fair value of derivatives 35.7 — 35.7 Foreign currency translations — (2.5 ) (2.5 ) Income tax effect (12.8 ) — (12.8 ) Net of tax 22.9 (2.5 ) 20.4 Amounts reclassified from accumulated other comprehensive income: Operating revenue: oil/natural gas production 107.1 — 107.1 Income tax effect (38.5 ) — (38.5 ) Net of tax 68.6 — 68.6 Other comprehensive loss, net of tax (45.7 ) (2.5 ) (48.2 ) Ending balance, net of tax $ 41.1 $ (6.0 ) $ 35.1 |
Guarantor Financial Statements
Guarantor Financial Statements (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Condensed Consolidating Balance Sheet | CONDENSED CONSOLIDATING BALANCE SHEET SEPTEMBER 30, 2016 (In thousands) Parent Guarantor Subsidiary Non- Guarantor Subsidiaries Eliminations Consolidated Assets Current assets: Cash and cash equivalents $ 152,384 $ 30,015 $ — $ — $ 182,399 Accounts receivable 17,336 40,736 883 (14,892 ) 44,063 Fair value of derivative contracts — 6,261 — — 6,261 Current income tax receivable 19,863 — — — 19,863 Other current assets 11,176 — — — 11,176 Total current assets 200,759 77,012 883 (14,892 ) 263,762 Oil and gas properties, full cost method: Proved 1,932,435 7,586,930 45,196 — 9,564,561 Less: accumulated DD&A (1,932,640 ) (7,076,233 ) (45,196 ) — (9,054,069 ) Net proved oil and gas properties (205 ) 510,697 — — 510,492 Unevaluated 261,101 143,125 — — 404,226 Other property and equipment, net 27,227 — — — 27,227 Other assets, net 28,852 948 — — 29,800 Investment in subsidiary 480,971 — — (480,971 ) — Total assets $ 998,705 $ 731,782 $ 883 $ (495,863 ) $ 1,235,507 Liabilities and Stockholders’ Equity Current liabilities: Accounts payable to vendors $ 35,189 $ 8,963 $ — $ (14,893 ) $ 29,259 Undistributed oil and gas proceeds 6,535 904 — — 7,439 Accrued interest 22,917 — — — 22,917 Asset retirement obligations — 60,223 — — 60,223 Current portion of long-term debt 292,795 — — — 292,795 Other current liabilities 10,778 125 — — 10,903 Total current liabilities 368,214 70,215 — (14,893 ) 423,536 Long-term debt 1,122,945 — — — 1,122,945 Asset retirement obligations 1,336 181,480 — — 182,816 Other long-term liabilities 25,871 — — — 25,871 Total liabilities 1,518,366 251,695 — (14,893 ) 1,755,168 Commitments and contingencies Stockholders’ equity: Common stock 56 — — — 56 Treasury stock (860 ) — — — (860 ) Additional paid-in capital 1,657,028 1,344,577 109,079 (1,453,656 ) 1,657,028 Accumulated deficit (2,179,803 ) (868,408 ) (108,196 ) 976,604 (2,179,803 ) Accumulated other comprehensive income 3,918 3,918 — (3,918 ) 3,918 Total stockholders’ equity (519,661 ) 480,087 883 (480,970 ) (519,661 ) Total liabilities and stockholders’ equity $ 998,705 $ 731,782 $ 883 $ (495,863 ) $ 1,235,507 CONDENSED CONSOLIDATING BALANCE SHEET DECEMBER 31, 2015 (In thousands) Parent Guarantor Subsidiary Non- Guarantor Subsidiaries Eliminations Consolidated Assets Current assets: Cash and cash equivalents $ 9,681 $ 2 $ 1,076 $ — $ 10,759 Accounts receivable 10,597 39,190 — (1,756 ) 48,031 Fair value of derivative contracts — 38,576 — — 38,576 Current income tax receivable 46,174 — — — 46,174 Other current assets 6,848 — 33 — 6,881 Total current assets 73,300 77,768 1,109 (1,756 ) 150,421 Oil and gas properties, full cost method: Proved 1,875,152 7,458,262 42,484 — 9,375,898 Less: accumulated DD&A (1,874,622 ) (6,686,849 ) (42,484 ) — (8,603,955 ) Net proved oil and gas properties 530 771,413 — — 771,943 Unevaluated 253,308 186,735 — — 440,043 Other property and equipment, net 29,289 — — — 29,289 Other assets, net 16,612 826 1,035 — 18,473 Investment in subsidiary 745,033 — 1,088 (746,121 ) — Total assets $ 1,118,072 $ 1,036,742 $ 3,232 $ (747,877 ) $ 1,410,169 Liabilities and Stockholders’ Equity Current liabilities: Accounts payable to vendors $ 16,063 $ 67,901 $ — $ (1,757 ) $ 82,207 Undistributed oil and gas proceeds 5,216 776 — — 5,992 Accrued interest 9,022 — — — 9,022 Asset retirement obligations — 20,400 891 — 21,291 Other current liabilities 40,161 551 — — 40,712 Total current liabilities 70,462 89,628 891 (1,757 ) 159,224 Long-term debt 1,060,955 — — — 1,060,955 Asset retirement obligations 1,240 203,335 — — 204,575 Other long-term liabilities 25,204 — — — 25,204 Total liabilities 1,157,861 292,963 891 (1,757 ) 1,449,958 Commitments and contingencies Stockholders’ equity: Common stock 55 — — — 55 Treasury stock (860 ) — — — (860 ) Additional paid-in capital 1,648,687 1,344,577 109,795 (1,454,372 ) 1,648,687 Accumulated deficit (1,705,623 ) (624,824 ) (95,306 ) 720,130 (1,705,623 ) Accumulated other comprehensive income (loss) 17,952 24,026 (12,148 ) (11,878 ) 17,952 Total stockholders’ equity (39,789 ) 743,779 2,341 (746,120 ) (39,789 ) Total liabilities and stockholders’ equity $ 1,118,072 $ 1,036,742 $ 3,232 $ (747,877 ) $ 1,410,169 |
Condensed Consolidating Statement of Operations | CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS THREE MONTHS ENDED SEPTEMBER 30, 2016 (In thousands) Parent Guarantor Non- Eliminations Consolidated Operating revenue: Oil production $ 3,587 $ 67,529 $ — $ — $ 71,116 Natural gas production 7,216 8,385 — — 15,601 Natural gas liquids production 5,737 929 — — 6,666 Other operational income 1,044 — — — 1,044 Total operating revenue 17,584 76,843 — — 94,427 Operating expenses: Lease operating expenses 2,771 14,205 — — 16,976 Transportation, processing and gathering expenses 9,607 1,026 — — 10,633 Production taxes 669 166 — — 835 Depreciation, depletion and amortization 26,388 32,530 — — 58,918 Write-down of oil and gas properties 1 36,483 — — 36,484 Accretion expense 58 10,024 — — 10,082 Salaries, general and administrative expenses 15,425 — — — 15,425 Incentive compensation expense 2,160 — — — 2,160 Restructuring fees 5,784 — — — 5,784 Other operational expenses 9,214 (155 ) — — 9,059 Derivative expense, net — 199 — — 199 Total operating expenses 72,077 94,478 — — 166,555 Loss from operations (54,493 ) (17,635 ) — — (72,128 ) Other (income) expenses: Interest expense 16,924 — — — 16,924 Interest income (43 ) (15 ) — — (58 ) Other income (64 ) (208 ) — — (272 ) Other expense 16 — — — 16 Loss from investment in subsidiaries 19,300 — 1 (19,301 ) — Total other (income) expenses 36,133 (223 ) 1 (19,301 ) 16,610 Loss before taxes (90,626 ) (17,412 ) (1 ) 19,301 (88,738 ) Provision (benefit) for income taxes: Current (991 ) — — — (991 ) Deferred — 1,888 — — 1,888 Total income taxes (991 ) 1,888 — — 897 Net loss $ (89,635 ) $ (19,300 ) $ (1 ) $ 19,301 $ (89,635 ) Comprehensive loss $ (93,102 ) $ (19,300 ) $ (1 ) $ 19,301 $ (93,102 ) CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS THREE MONTHS ENDED SEPTEMBER 30, 2015 (In thousands) Parent Guarantor Subsidiary Non- Guarantor Subsidiaries Eliminations Consolidated Operating revenue: Oil production $ 1,633 $ 103,380 $ — $ — $ 105,013 Natural gas production 7,111 10,256 — — 17,367 Natural gas liquids production 3,502 2,478 — — 5,980 Other operational income 1,392 — — — 1,392 Derivative income, net — 2,444 — — 2,444 Total operating revenue 13,638 118,558 — — 132,196 Operating expenses: Lease operating expenses 2,680 21,562 2 — 24,244 Transportation, processing and gathering expenses 13,697 4,511 — — 18,208 Production taxes 1,777 275 — — 2,052 Depreciation, depletion and amortization 27,518 34,418 — — 61,936 Write-down of oil and gas properties 295,679 — — — 295,679 Accretion expense 92 6,406 — — 6,498 Salaries, general and administrative expenses 19,348 200 4 — 19,552 Incentive compensation expense 794 — — — 794 Other operational expenses 142 300 — — 442 Total operating expenses 361,727 67,672 6 — 429,405 Income (loss) from operations (348,089 ) 50,886 (6 ) — (297,209 ) Other (income) expenses: Interest expense 10,871 1 — — 10,872 Interest income (39 ) (7 ) (1 ) — (47 ) Other income (117 ) (294 ) — — (411 ) Other expense 148 — — — 148 (Income) loss from investment in subsidiaries (227,973 ) — 16,272 211,701 — Total other (income) expenses (217,110 ) (300 ) 16,271 211,701 10,562 Income (loss) before taxes (130,979 ) 51,186 (16,277 ) (211,701 ) (307,771 ) Provision (benefit) for income taxes: Deferred 160,986 (193,059 ) 16,267 — (15,806 ) Total income taxes 160,986 (193,059 ) 16,267 — (15,806 ) Net income (loss) $ (291,965 ) $ 244,245 $ (32,544 ) $ (211,701 ) $ (291,965 ) Comprehensive income (loss) $ (297,564 ) $ 244,245 $ (32,544 ) $ (211,701 ) $ (297,564 ) |
Condensed Consolidating Statement of Cash Flows | CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS NINE MONTHS ENDED SEPTEMBER 30, 2016 (In thousands) Parent Guarantor Subsidiary Non-Guarantor Subsidiaries Eliminations Consolidated Cash flows from operating activities: Net loss $ (474,180 ) $ (243,584 ) $ (12,890 ) $ 256,474 $ (474,180 ) Adjustments to reconcile net loss to net cash provided by operating activities: Depreciation, depletion and amortization 45,452 121,255 — — 166,707 Write-down of oil and gas properties 15,859 268,128 350 — 284,337 Accretion expense 174 29,973 — — 30,147 Deferred income tax provision — 10,947 — — 10,947 Settlement of asset retirement obligations (78 ) (14,129 ) (899 ) — (15,106 ) Non-cash stock compensation expense 6,407 — — — 6,407 Non-cash derivative expense — 1,261 — — 1,261 Non-cash interest expense 14,278 — — — 14,278 Other non-cash expense — — 6,081 — 6,081 Change in current income taxes 21,584 — — — 21,584 Non-cash loss from investment in subsidiaries 250,029 — 6,445 (256,474 ) — Change in intercompany receivables/payables (1,658 ) 1,658 — — — (Increase) decrease in accounts receivable 7,966 (3,116 ) (882 ) — 3,968 (Increase) decrease in other current assets (4,459 ) — 33 — (4,426 ) Increase (decrease) in accounts payable 7,385 (4,168 ) — — 3,217 Decrease in other current liabilities (13,924 ) (298 ) — — (14,222 ) Other (7,389 ) (718 ) — — (8,107 ) Net cash (used in) provided by operating activities (132,554 ) 167,209 (1,762 ) — 32,893 Cash flows from investing activities: Investment in oil and gas properties (63,075 ) (137,196 ) (351 ) — (200,622 ) Investment in fixed and other assets (1,231 ) — — — (1,231 ) Change in restricted funds — — 1,046 — 1,046 Investment in subsidiaries — — 716 (716 ) — Net cash (used in) provided by investing activities (64,306 ) (137,196 ) 1,411 (716 ) (200,807 ) Cash flows from financing activities: Proceeds from bank borrowings 477,000 — — — 477,000 Repayments of bank borrowings (135,500 ) — — — (135,500 ) Repayments of building loan (285 ) — — — (285 ) Deferred financing costs (900 ) — — — (900 ) Equity proceeds from parent — — (716 ) 716 — Net payments for share-based compensation (752 ) — — — (752 ) Net cash provided by (used in) financing activities 339,563 — (716 ) 716 339,563 Effect of exchange rate changes on cash — — (9 ) — (9 ) Net change in cash and cash equivalents 142,703 30,013 (1,076 ) — 171,640 Cash and cash equivalents, beginning of period 9,681 2 1,076 — 10,759 Cash and cash equivalents, end of period $ 152,384 $ 30,015 $ — $ — $ 182,399 CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS NINE MONTHS ENDED SEPTEMBER 30, 2015 (In thousands) Parent Guarantor Subsidiary Non-Guarantor Subsidiaries Eliminations Consolidated Cash flows from operating activities: Net income (loss) $ (772,259 ) $ 318,337 $ (90,380 ) $ (227,957 ) $ (772,259 ) Adjustments to reconcile net income (loss) to net cash provided by operating activities: Depreciation, depletion and amortization 113,682 112,627 — — 226,309 Write-down of oil and gas properties 966,216 — 45,169 — 1,011,385 Accretion expense 274 19,041 — — 19,315 Deferred income tax benefit (113,111 ) (167,649 ) — — (280,760 ) Settlement of asset retirement obligations (15 ) (59,811 ) — — (59,826 ) Non-cash stock compensation expense 9,163 — — — 9,163 Non-cash derivative expense — 10,854 — — 10,854 Non-cash interest expense 13,210 — — — 13,210 Change in current income taxes 7,211 — — — 7,211 Non-cash (income) expense from investment in subsidiaries (273,147 ) — 45,190 227,957 — Change in intercompany receivables/payables 31,320 (41,056 ) 9,736 — — Decrease in accounts receivable 29,561 4,317 17 — 33,895 Increase in other current assets (1,050 ) — (40 ) — (1,090 ) (Increase) decrease in inventory (2,415 ) 2,415 — — — Decrease in accounts payable (7,562 ) (4,030 ) — — (11,592 ) Increase (decrease) in other current liabilities (6,855 ) 102 — — (6,753 ) Other 645 (727 ) — — (82 ) Net cash (used in) provided by operating activities (5,132 ) 194,420 9,692 — 198,980 Cash flows from investing activities: Investment in oil and gas properties (177,497 ) (197,471 ) (10,560 ) — (385,528 ) Proceeds from sale of oil and gas properties, net of expenses — 11,643 — — 11,643 Investment in fixed and other assets (1,455 ) — — — (1,455 ) Change in restricted funds 177,647 — 1,828 — 179,475 Investment in subsidiaries — — (9,708 ) 9,708 — Net cash used in investing activities (1,305 ) (185,828 ) (18,440 ) 9,708 (195,865 ) Cash flows from financing activities: Proceeds from bank borrowings 5,000 — — — 5,000 Repayments of bank borrowings (5,000 ) — — — (5,000 ) Equity proceeds from parent — — 9,708 (9,708 ) — Net payments for share-based compensation (3,127 ) — — — (3,127 ) Net cash (used in) provided by financing activities (3,127 ) — 9,708 (9,708 ) (3,127 ) Effect of exchange rate changes on cash — — (2 ) — (2 ) Net change in cash and cash equivalents (9,564 ) 8,592 958 — (14 ) Cash and cash equivalents, beginning of period 72,886 1,450 152 — 74,488 Cash and cash equivalents, end of period $ 63,322 $ 10,042 $ 1,110 $ — $ 74,474 |
Interim Financial Statements (D
Interim Financial Statements (Details) | Jun. 10, 2016 | May 27, 2016 | Sep. 30, 2016$ / shares | Dec. 31, 2015$ / shares |
Accounting Policies [Abstract] | ||||
Stock split, conversion ratio | 0.1 | 0.1 | ||
Common stock, par value (in usd per share) | $ 0.01 | $ 0.01 |
Going Concern (Details)
Going Concern (Details) a in Thousands | Oct. 20, 2016USD ($)a | Jun. 14, 2016USD ($) | Sep. 30, 2016USD ($) | Sep. 30, 2015USD ($) | Dec. 31, 2015 |
Debt Instrument [Line Items] | |||||
Long-term debt, gross | $ 1,428,000,000 | ||||
Consolidated funded debt to consolidated EBITDA ratio | 3.75 | ||||
Proceeds from sale of property | $ 0 | $ 11,643,000 | |||
Subsequent Event | RSA | |||||
Debt Instrument [Line Items] | |||||
Percentage of common stock issued in reorganization | 95.00% | ||||
Repayments of debt | $ 225,000,000 | ||||
Acreage sold in agreement | a | 86 | ||||
Subsequent Event | RSA | Appalachia regions of Pennsylvania and West Virginia | |||||
Debt Instrument [Line Items] | |||||
Minimum payment of net cash proceeds from the sale of properties | $ 150,000,000 | ||||
Payment of excess net cash proceeds from sale of properties | 85.00% | ||||
Minimum proceeds from sale property | $ 350,000,000 | ||||
Subsequent Event | Tug Hill | Disposal Group, Disposed of by Sale | |||||
Debt Instrument [Line Items] | |||||
Proceeds from sale of property | $ 360,000,000 | ||||
7 1⁄2% Senior Notes due 2022 | |||||
Debt Instrument [Line Items] | |||||
Interest rate | 7.50% | ||||
1.75% Senior Notes due 2017 | |||||
Debt Instrument [Line Items] | |||||
Interest rate | 1.75% | ||||
Revolving credit facility | |||||
Debt Instrument [Line Items] | |||||
Line of credit facility, minimum liquidity requirement | $ 125,000,000 | ||||
Senior Notes | 7 1⁄2% Senior Notes due 2022 | |||||
Debt Instrument [Line Items] | |||||
Interest rate | 7.50% | ||||
Senior Notes | 7 1⁄2% Senior Notes due 2022 | RSA | |||||
Debt Instrument [Line Items] | |||||
Interest rate | 7.50% | ||||
Convertible Debt | 1.75% Senior Notes due 2017 | |||||
Debt Instrument [Line Items] | |||||
Interest rate | 1.75% | ||||
Quarter ended June 30, 2016 | |||||
Debt Instrument [Line Items] | |||||
Consolidated funded debt to consolidated EBITDA ratio | 5.25 | ||||
Quarter ending September 30, 2016 | |||||
Debt Instrument [Line Items] | |||||
Consolidated funded debt to consolidated EBITDA ratio | 6.50 | ||||
Quarter ending December 31, 2016 | |||||
Debt Instrument [Line Items] | |||||
Consolidated funded debt to consolidated EBITDA ratio | 9.50 | ||||
Thereafter | |||||
Debt Instrument [Line Items] | |||||
Consolidated funded debt to consolidated EBITDA ratio | 3.75 |
Earnings Per Share - Calculatio
Earnings Per Share - Calculation of Basic and Diluted Weighted Average Shares Outstanding and Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Basic: | ||||
Net loss | $ (89,635) | $ (291,965) | $ (474,180) | $ (772,259) |
Net income attributable to participating securities | 0 | 0 | 0 | 0 |
Net loss attributable to common stock - basic | (89,635) | (291,965) | (474,180) | (772,259) |
Diluted: | ||||
Net loss | (89,635) | (291,965) | (474,180) | (772,259) |
Net income attributable to participating securities | 0 | 0 | 0 | 0 |
Net loss attributable to common stock - diluted | $ (89,635) | $ (291,965) | $ (474,180) | $ (772,259) |
Weighted average shares (denominator): | ||||
Weighted average shares - basic (in shares) | 5,600 | 5,528 | 5,585 | 5,523 |
Dilutive effect of stock options (in shares) | 0 | 0 | 0 | 0 |
Dilutive effect of convertible notes (in shares) | 0 | 0 | 0 | 0 |
Weighted average shares - diluted (in shares) | 5,600 | 5,528 | 5,585 | 5,523 |
Basic loss per share (in usd per share) | $ (16.01) | $ (52.82) | $ (84.90) | $ (139.83) |
Diluted loss per share (in usd per share) | $ (16.01) | $ (52.82) | $ (84.90) | $ (139.83) |
Earnings Per Share - Additional
Earnings Per Share - Additional Information (Details) - shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Earnings Per Share [Abstract] | ||||
Antidilutive stock options outstanding (in shares) | 12,900 | 14,400 | 12,900 | 14,400 |
Shares of common stock issued upon vesting of restricted stock (in shares) | 12,900 | 1,832 | 75,100 | 41,375 |
Derivative Instruments and He36
Derivative Instruments and Hedging Activities - Additional Information (Details) $ in Thousands | Nov. 07, 2016counterparty | Sep. 30, 2016USD ($) | Dec. 31, 2015USD ($) |
Derivative Instruments, Gain (Loss) [Line Items] | |||
Maximum correlation between price of oil & natural gas in market and underlying price basis indicative in the derivative contract | 100.00% | ||
Accumulated other comprehensive income (loss) | $ 3,918 | $ 17,952 | |
Accumulated other comprehensive income, to be reclassified into earnings in the next twelve months | 3,900 | ||
Cash Flow Hedges | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Accumulated other comprehensive income (loss) | $ 3,900 | ||
Subsequent Event | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Percentage of counterparty contract volume | 86.00% | ||
Subsequent Event | Fixed-Price Swaps And Costless Collars | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Number of counterparties | counterparty | 2 |
Derivative Instruments and He37
Derivative Instruments and Hedging Activities - Hedging Positions (Details) - Subsequent Event - Designated as Hedging Instrument | Nov. 07, 2016bbl$ / MMBTU$ / bblMBbls |
NYMEX Price Swaps - Natural Gas 2016, Option One | |
Derivatives, Fair Value [Line Items] | |
Daily Volume (MMBtus/d) | MBbls | 10,000 |
Swap Price ($) | 4.110 |
NYMEX Price Swaps - Natural Gas 2016, Option Two | |
Derivatives, Fair Value [Line Items] | |
Daily Volume (MMBtus/d) | MBbls | 10,000 |
Swap Price ($) | 4.120 |
NYMEX Price Swaps - Natural Gas 2016, Option Three | |
Derivatives, Fair Value [Line Items] | |
Daily Volume (MMBtus/d) | MBbls | |
Swap Price ($) | |
NYMEX Price Swaps - Oil 2016, Option One | |
Derivatives, Fair Value [Line Items] | |
Swap Price ($) | $ / bbl | 49.75 |
Daily Volume (Bbls/d) | bbl | 1,000 |
NYMEX Price Swaps - Oil 2016, Option Two | |
Derivatives, Fair Value [Line Items] | |
Swap Price ($) | $ / bbl | 52.78 |
Daily Volume (Bbls/d) | bbl | 1,000 |
NYMEX Price Swaps - Oil 2016, Option Three | |
Derivatives, Fair Value [Line Items] | |
Swap Price ($) | $ / bbl | 90 |
Daily Volume (Bbls/d) | bbl | 1,000 |
NYMEX Collar - Oil 2016 | |
Derivatives, Fair Value [Line Items] | |
Daily Volume (MMBtus/d) | bbl | 1,000 |
Floor Price ($) | 45 |
Ceiling Price ($) | 54.75 |
Derivative Instruments and He38
Derivative Instruments and Hedging Activities - Location and Fair Value Amounts of Derivative Instruments Reported in Balance Sheet (Details) - Designated as Hedging Instrument - Commodity contracts - USD ($) $ in Millions | Sep. 30, 2016 | Dec. 31, 2015 |
Asset Derivatives | ||
Fair Value of Derivative Instruments, Assets | $ 6.3 | $ 38.6 |
Liability Derivatives | ||
Fair Value of Derivative Instruments, Liabilities | 0 | 0 |
Current assets: Fair value of derivative contracts | ||
Asset Derivatives | ||
Fair Value of Derivative Instruments, Assets | 6.3 | 38.6 |
Long-term assets: Fair value of derivative contracts | ||
Asset Derivatives | ||
Fair Value of Derivative Instruments, Assets | 0 | 0 |
Current liabilities: Fair value of derivative contracts | ||
Liability Derivatives | ||
Fair Value of Derivative Instruments, Liabilities | 0 | 0 |
Long-term liabilities: Fair value of derivative contracts | ||
Liability Derivatives | ||
Fair Value of Derivative Instruments, Liabilities | $ 0 | $ 0 |
Derivative Instruments and He39
Derivative Instruments and Hedging Activities - Before Tax Effect of Derivative Instruments in Statement of Operations (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Decrease/increase in oil revenue owing to effective hedging contracts | $ 5.3 | $ 36.3 | $ 19.7 | $ 96.8 |
Decrease/increase in gas revenue owing to effective hedging contracts | 2.4 | 3.6 | 9.7 | 10.3 |
Designated as Hedging Instrument | Cash Flow Hedging | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Amount of Gain (Loss) Recognized in Other Comprehensive Income on Derivatives | 2.3 | 31.6 | (1.7) | 35.7 |
Gain (Loss) Reclassified from Accumulated Other Comprehensive Income into Income (Effective Portion) (a) | 7.7 | 39.9 | 29.4 | 107.1 |
Gain (Loss) Recognized in Income on Derivatives (Ineffective Portion) | (0.2) | 1.2 | (0.7) | 1.7 |
Designated as Hedging Instrument | Cash Flow Hedges | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Amount of Gain (Loss) Recognized in Other Comprehensive Income on Derivatives | 2.3 | 31.6 | (1.7) | 35.7 |
Designated as Hedging Instrument | Cash Flow Hedges | Derivative Income (Expense), Net | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Gain (Loss) Recognized in Income on Derivatives (Ineffective Portion) | (0.2) | 1.2 | (0.7) | 1.7 |
Designated as Hedging Instrument | Cash Flow Hedges | Reclassification out of Accumulated Other Comprehensive Income | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Gain (Loss) Reclassified from Accumulated Other Comprehensive Income into Income (Effective Portion) (a) | $ 7.7 | $ 39.9 | $ 29.4 | $ 107.1 |
Derivative Instruments and He40
Derivative Instruments and Hedging Activities - Gains or Losses Related to Changes in Fair Value and Cash Settlements on Derivatives Not Qualifying as Hedging Instruments (Details) - Not Designated as Hedging Instrument - Commodity contracts - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Cash settlements | $ 0 | $ 3.8 | $ 0 | $ 11 |
Change in fair value | 0 | (2.6) | 0 | (7.9) |
Total gains (losses) on non-qualifying hedges | $ 0 | $ 1.2 | $ 0 | $ 3.1 |
Debt - Long-Term Debt (Details)
Debt - Long-Term Debt (Details) - USD ($) $ in Thousands | Sep. 30, 2016 | Dec. 31, 2015 |
Debt Instrument [Line Items] | ||
Long-term debt | $ 1,415,700 | $ 1,061,000 |
Less: current portion of long-term debt | (292,795) | 0 |
Long-term debt | $ 1,122,945 | $ 1,060,955 |
1.75% Senior Notes due 2017 | ||
Debt Instrument [Line Items] | ||
Interest rate | 1.75% | |
1.75% Senior Notes due 2017 | Convertible Debt | ||
Debt Instrument [Line Items] | ||
Interest rate | 1.75% | |
Long-term debt | $ 292,400 | $ 279,300 |
7 1⁄2% Senior Notes due 2022 | ||
Debt Instrument [Line Items] | ||
Interest rate | 7.50% | |
7 1⁄2% Senior Notes due 2022 | Senior Notes | ||
Debt Instrument [Line Items] | ||
Interest rate | 7.50% | |
Long-term debt | $ 770,400 | $ 770,000 |
4.20% Building Loan | ||
Debt Instrument [Line Items] | ||
Interest rate | 4.20% | |
4.20% Building Loan | Secured Debt | ||
Debt Instrument [Line Items] | ||
Interest rate | 4.20% | |
Long-term debt | $ 11,400 | $ 11,700 |
Revolving Credit Facility | Revolving credit facility | Line of Credit | ||
Debt Instrument [Line Items] | ||
Long-term debt | $ 341,500 | $ 0 |
Debt - Additional Information (
Debt - Additional Information (Details) | Mar. 01, 2017USD ($) | Jun. 14, 2016USD ($) | Jun. 13, 2016USD ($) | Jun. 10, 2016$ / shares | May 27, 2016 | May 13, 2016USD ($) | Mar. 06, 2012USD ($)$ / sharesshares | Sep. 30, 2016USD ($)$ / shares | Sep. 30, 2015USD ($) | Sep. 30, 2016USD ($)instalment$ / shares | Sep. 30, 2015USD ($) | Nov. 07, 2016USD ($) | Apr. 13, 2016USD ($) | Dec. 31, 2015USD ($) | Jun. 24, 2014USD ($) | Nov. 27, 2013USD ($) | Nov. 08, 2012USD ($) |
Debt Instrument [Line Items] | |||||||||||||||||
Current portion of long-term debt | $ 292,795,000 | $ 292,795,000 | $ 0 | ||||||||||||||
Fair value of amount outstanding | $ 341,500,000 | $ 341,500,000 | $ 457,000,000 | ||||||||||||||
Repayments of lines of credit | $ 56,800,000 | ||||||||||||||||
Consolidated funded debt to consolidated EBITDA ratio | 3.75 | ||||||||||||||||
Long-term debt, weighted average interest rate | 3.10% | 3.10% | |||||||||||||||
Consolidated EBITDA To consolidated net interest expense | 2.5 | 2.5 | |||||||||||||||
Stock split, conversion ratio | 0.1 | 0.1 | |||||||||||||||
Long-term debt | $ 1,415,700,000 | $ 1,415,700,000 | 1,061,000,000 | ||||||||||||||
Interest expense related to contractual interest coupon of convertible notes | 1,300,000 | $ 1,300,000 | 3,900,000 | $ 3,900,000 | |||||||||||||
Accrued interest | 22,917,000 | $ 22,917,000 | $ 9,022,000 | ||||||||||||||
Minimum | |||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||
Percentage of borrowing base utilization, percent | 1.50% | ||||||||||||||||
Maximum | |||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||
Percentage of borrowing base utilization, percent | 2.50% | ||||||||||||||||
Subsequent Event | |||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||
Fair value of amount outstanding | $ 341,500,000 | ||||||||||||||||
Quarter ended June 30, 2016 | |||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||
Consolidated funded debt to consolidated EBITDA ratio | 5.25 | ||||||||||||||||
Quarter ending September 30, 2016 | |||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||
Consolidated funded debt to consolidated EBITDA ratio | 6.50 | ||||||||||||||||
Quarter ending December 31, 2016 | |||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||
Consolidated funded debt to consolidated EBITDA ratio | 9.50 | ||||||||||||||||
Thereafter | |||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||
Consolidated funded debt to consolidated EBITDA ratio | 3.75 | ||||||||||||||||
1 3⁄4% Senior Convertible Notes due 2017 | |||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||
Current portion of long-term debt | $ 292,400,000 | $ 292,400,000 | |||||||||||||||
Aggregate principal amount of senior subordinated notes | $ 300,000,000 | ||||||||||||||||
Initial conversion rate of common stock | 0.0023449 | 0.0234449 | 1 | ||||||||||||||
Initial conversion price of convertible note 2017 (in usd per share) | $ / shares | $ 426.50 | $ 42.65 | |||||||||||||||
Closing share price (in usd per share) | $ / shares | $ 11.88 | $ 11.88 | |||||||||||||||
Payment for call option | $ 70,800,000 | ||||||||||||||||
Anti-dilution adjustments for purchases of call option (in shares) | shares | 703,347 | ||||||||||||||||
Strike price per share (in usd per share) | $ / shares | $ 559.10 | ||||||||||||||||
Proceeds from sale of warrants | $ 40,100,000 | ||||||||||||||||
Interest expense related to amortization of discount | $ 4,100,000 | 3,800,000 | $ 12,000,000 | 11,100,000 | |||||||||||||
Amortization of deferred financing costs | 400,000 | $ 400,000 | 1,100,000 | $ 1,100,000 | |||||||||||||
1 3⁄4% Senior Convertible Notes due 2017 | Scenario, Forecast | |||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||
Cash share holders receive for each dollar In principle | $ 1,000 | ||||||||||||||||
4.20% Building Loan | |||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||
Current portion of long-term debt | 400,000 | 400,000 | |||||||||||||||
Revolving credit facility | |||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||
Current portion of long-term debt | 175,300,000 | ||||||||||||||||
Redetermined base borrowing and credit facility | $ 900,000,000 | ||||||||||||||||
Borrowing base | $ 360,000,000 | 300,000,000 | $ 500,000,000 | ||||||||||||||
Outstanding borrowing under bank credit facility | 12,500,000 | $ 12,500,000 | $ 18,300,000 | ||||||||||||||
Period in which outstanding amount has to be repaid to cure deficiency | 10 days | ||||||||||||||||
Period in which bank has to add new properties to borrowing base and has to grant mortgage to banks | 30 days | ||||||||||||||||
Number of monthly installments | instalment | 6 | ||||||||||||||||
Repayments of lines of credit | $ 29,200,000 | $ 29,200,000 | |||||||||||||||
Line of credit facility, minimum liquidity requirement | 125,000,000 | ||||||||||||||||
Line of credit facility, limitations on capital expenditures | 60,000,000 | ||||||||||||||||
Line of credit facility, amount of cash to which anti-hoarding cash provisions apply | 50,000,000 | ||||||||||||||||
Initial bank and availability under facility | 6,000,000 | $ 6,000,000 | |||||||||||||||
Oil and gas reserve as proportion of discounted present value of future net cash flow, for mortgage, percent | 86.00% | ||||||||||||||||
Revolving credit facility | Subsequent Event | |||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||
Outstanding borrowing under bank credit facility | 12,500,000 | ||||||||||||||||
Initial bank and availability under facility | $ 6,000,000 | ||||||||||||||||
Revolving credit facility | Uncompleted Wells | |||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||
Line of credit facility, limitations on capital expenditures | $ 25,000,000 | ||||||||||||||||
Senior Notes Due 2022 | |||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||
Aggregate principal amount of senior subordinated notes | 775,000,000 | $ 775,000,000 | $ 475,000,000 | $ 300,000,000 | |||||||||||||
Accrued interest | $ 29,200,000 | $ 29,200,000 | |||||||||||||||
Grace period to make interest payment | 30 days | ||||||||||||||||
Senior Notes Due 2022 | Minimum | |||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||
Percentage of minimum principal amount before an event of default | 25.00% |
Asset Retirement Obligations -
Asset Retirement Obligations - Changes in Asset Retirement Obligations (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Asset Retirement Obligation, Roll Forward Analysis [Roll Forward] | ||||
Asset retirement obligations as of the beginning of the period, including current portion | $ 225,900 | |||
Liabilities incurred | 2,100 | |||
Liabilities settled | (15,100) | |||
Accretion expense | $ 10,082 | $ 6,498 | 30,147 | $ 19,315 |
Asset retirement obligations as of the end of the period, including current portion | $ 243,000 | $ 243,000 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2016 | Dec. 31, 2015 | |
Valuation Allowance [Line Items] | ||
Effective income tax rate, percent | 1.40% | |
Federal statutory income tax rate, percent | 35.00% | |
Current income tax receivable | $ 19,863 | $ 46,174 |
Income taxes receivable, noncurrent | 4,700 | |
Ceiling Test Write Downs From Decline in Commodity Prices | ||
Valuation Allowance [Line Items] | ||
Valuation allowance | $ 343,100 |
Fair Value Measurements - Addit
Fair Value Measurements - Additional Information (Details) - USD ($) | Sep. 30, 2016 | Dec. 31, 2015 |
Debt Instrument [Line Items] | ||
Liabilities, fair value | $ 0 | $ 0 |
1 3⁄4% Senior Convertible Notes due 2017 | ||
Debt Instrument [Line Items] | ||
Fair value disclosures | 278,600,000 | 217,100,000 |
7 1⁄2% Senior Notes due 2022 | ||
Debt Instrument [Line Items] | ||
Fair value of notes | $ 441,800,000 | $ 271,300,000 |
Fair Value Measurements - Asset
Fair Value Measurements - Assets and Liabilities Measured at Fair Value on Recurring Basis (Details) - USD ($) $ in Millions | Sep. 30, 2016 | Dec. 31, 2015 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities (Other assets) | $ 8.8 | $ 8.5 |
Assets, fair value, total | 15.1 | 47.1 |
Derivative contracts | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative contracts | 6.3 | 38.6 |
Quoted Prices in Active Markets for Identical Assets (Level 1) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities (Other assets) | 8.8 | 8.5 |
Assets, fair value, total | 8.8 | 8.5 |
Quoted Prices in Active Markets for Identical Assets (Level 1) | Derivative contracts | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative contracts | 0 | 0 |
Significant Other Observable Inputs (Level 2) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities (Other assets) | 0 | 0 |
Assets, fair value, total | 6.3 | 36.6 |
Significant Other Observable Inputs (Level 2) | Derivative contracts | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative contracts | 6.3 | 36.6 |
Significant Unobservable Inputs (Level 3) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities (Other assets) | 0 | 0 |
Assets, fair value, total | 0 | 2 |
Significant Unobservable Inputs (Level 3) | Derivative contracts | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative contracts | $ 0 | $ 2 |
Fair Value Measurements - Hedgi
Fair Value Measurements - Hedging Contracts (Details) $ in Millions | 9 Months Ended |
Sep. 30, 2016USD ($) | |
Hedging Contracts, net | |
Balance, beginning of the period | $ 2 |
Total gains/(losses) (realized or unrealized): | |
Included in earnings | 1.1 |
Included in other comprehensive income | (1.9) |
Purchases, sales, issuances and settlements | (1.2) |
Transfers in and out of Level 3 | 0 |
Balance, end of the period | 0 |
The amount of total gains/(losses) for the period included in earnings (derivative income) attributable to the change in unrealized gain/(losses) relating to derivatives still held at the end of period | $ 0 |
Accumulated Other Comprehensi48
Accumulated Other Comprehensive Income (Loss) - Schedule of Changes in Accumulated Other Comprehensive Income Loss (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Beginning balance, net of tax | $ (39,789) | |||
Amounts reclassified from accumulated other comprehensive income: | ||||
Ending balance, net of tax | $ (519,661) | (519,661) | ||
Cash Flow Hedges | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Beginning balance, net of tax | 7,400 | $ 46,500 | 24,000 | $ 86,800 |
Other comprehensive income (loss) before reclassifications: | ||||
Change in fair value of derivatives | 2,300 | 31,600 | (1,700) | 35,700 |
Foreign currency translations | 0 | 0 | ||
Income tax effect | (800) | (11,500) | 600 | (12,800) |
Net of tax | 1,500 | 20,100 | (1,100) | 22,900 |
Amounts reclassified from accumulated other comprehensive income: | ||||
Income tax effect | (2,700) | (14,400) | (10,400) | (38,500) |
Net of tax | 5,000 | 25,500 | 19,000 | 68,600 |
Other comprehensive loss, net of tax | (3,500) | (5,400) | (20,100) | (45,700) |
Ending balance, net of tax | 3,900 | 41,100 | 3,900 | 41,100 |
Cash Flow Hedges | Operating revenue: oil/natural gas production | ||||
Amounts reclassified from accumulated other comprehensive income: | ||||
Operating revenue: oil/natural gas production | 7,700 | 39,900 | 29,400 | 107,100 |
Cash Flow Hedges | Other operational expenses | ||||
Amounts reclassified from accumulated other comprehensive income: | ||||
Operating revenue: oil/natural gas production | 0 | |||
Foreign Currency Items | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Beginning balance, net of tax | (5,800) | (6,000) | (3,500) | |
Other comprehensive income (loss) before reclassifications: | ||||
Change in fair value of derivatives | 0 | 0 | 0 | |
Foreign currency translations | (200) | (2,500) | ||
Income tax effect | 0 | 0 | 0 | |
Net of tax | (200) | 0 | (2,500) | |
Amounts reclassified from accumulated other comprehensive income: | ||||
Income tax effect | 0 | 0 | 0 | |
Net of tax | 0 | (6,000) | 0 | |
Other comprehensive loss, net of tax | (200) | 6,000 | (2,500) | |
Ending balance, net of tax | 0 | (6,000) | 0 | (6,000) |
Foreign Currency Items | Operating revenue: oil/natural gas production | ||||
Amounts reclassified from accumulated other comprehensive income: | ||||
Operating revenue: oil/natural gas production | 0 | 0 | 0 | |
Foreign Currency Items | Other operational expenses | ||||
Amounts reclassified from accumulated other comprehensive income: | ||||
Operating revenue: oil/natural gas production | (6,000) | |||
AOCI Attributable to Parent | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Beginning balance, net of tax | 40,700 | 18,000 | 83,300 | |
Other comprehensive income (loss) before reclassifications: | ||||
Change in fair value of derivatives | 31,600 | (1,700) | 35,700 | |
Foreign currency translations | (200) | (2,500) | ||
Income tax effect | (11,500) | 600 | (12,800) | |
Net of tax | 19,900 | (1,100) | 20,400 | |
Amounts reclassified from accumulated other comprehensive income: | ||||
Income tax effect | (14,400) | (10,400) | (38,500) | |
Net of tax | 25,500 | 13,000 | 68,600 | |
Other comprehensive loss, net of tax | (5,600) | (14,100) | (48,200) | |
Ending balance, net of tax | $ 3,900 | 35,100 | 3,900 | 35,100 |
AOCI Attributable to Parent | Operating revenue: oil/natural gas production | ||||
Amounts reclassified from accumulated other comprehensive income: | ||||
Operating revenue: oil/natural gas production | $ 39,900 | 29,400 | $ 107,100 | |
AOCI Attributable to Parent | Other operational expenses | ||||
Amounts reclassified from accumulated other comprehensive income: | ||||
Operating revenue: oil/natural gas production | $ (6,000) |
Investment in Oil and Gas Pro49
Investment in Oil and Gas Properties - Additional Information (Details) $ in Thousands | Sep. 30, 2016USD ($)$ / Mcf$ / bbl | Jun. 30, 2016USD ($)$ / Mcf$ / bbl | Mar. 31, 2016USD ($)$ / Mcf$ / bbl | Sep. 30, 2016USD ($)$ / Mcf$ / bbl | Sep. 30, 2015USD ($) | Sep. 30, 2016USD ($)$ / Mcf$ / bbl | Sep. 30, 2015USD ($) |
Oil and Gas In Process Activities [Line Items] | |||||||
Write-down of oil and gas properties | $ 36,484 | $ 295,679 | $ 284,337 | $ 1,011,385 | |||
Decrease in written down value of oil and gas properties | $ 18,100 | $ 23,000 | $ 9,600 | ||||
CANADA | |||||||
Oil and Gas In Process Activities [Line Items] | |||||||
Write-down of oil and gas properties | $ 300 | ||||||
Oil | |||||||
Oil and Gas In Process Activities [Line Items] | |||||||
Average 12-month oil prices net of differentials | $ / bbl | 40.51 | 43.49 | 46.72 | 40.51 | 40.51 | ||
Natural Gas | |||||||
Oil and Gas In Process Activities [Line Items] | |||||||
Average twelve month gas prices net of differentials | $ / Mcf | 1.99 | 1.93 | 2.01 | 1.99 | 1.99 | ||
Natural Gas Liquids (MBbls) | |||||||
Oil and Gas In Process Activities [Line Items] | |||||||
Average 12-month gas prices net of differentials | $ / bbl | 13.88 | 9.33 | 13.65 | 13.88 | 13.88 | ||
Oil And Gas | |||||||
Oil and Gas In Process Activities [Line Items] | |||||||
Write-down of oil and gas properties | $ 36,500 | $ 118,600 | $ 128,900 |
Other Operational Expenses (Det
Other Operational Expenses (Details) $ in Millions | 9 Months Ended |
Sep. 30, 2016USD ($) | |
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | |
Oil and gas, subsidy charges | $ 15.3 |
Foreign Currency Items | |
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | |
Other operational loss | 6 |
ENSCO Deep Water Drilling Rig | |
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | |
Loss on contract termination | 20 |
Saxon Appalachian Rig | |
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | |
Loss on contract termination | $ 7.5 |
Restructuring Fees (Details)
Restructuring Fees (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Restructuring and Related Activities [Abstract] | ||||
Restructuring fees | $ 5,784 | $ 0 | $ 16,173 | $ 0 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Details) - Bureau of Ocean Energy Management - USD ($) $ in Millions | Oct. 20, 2016 | Sep. 12, 2016 | Sep. 30, 2016 | Mar. 21, 2016 |
Loss Contingencies [Line Items] | ||||
Bonding requirement, amount | $ 565 | |||
Surety bond | $ 139 | |||
Percentage of maximum net worth allowed for self insurance | 10.00% | |||
Period for accepting the plan terms | 10 days | |||
Period to provide security for sole-liability properties | 60 days | |||
Period to provide additional security for other properties | 120 days | |||
Minimum | Scenario, Forecast | ||||
Loss Contingencies [Line Items] | ||||
Additional incremental bonding requirement, amount | $ 35 | |||
Maximum | Scenario, Forecast | ||||
Loss Contingencies [Line Items] | ||||
Additional incremental bonding requirement, amount | $ 40 |
New York Stock Exchange Compl53
New York Stock Exchange Compliance (Details) | Jul. 01, 2016USD ($)$ / shares | Jun. 10, 2016 | May 27, 2016 | Apr. 29, 2016$ / shares | Sep. 30, 2016USD ($) | May 17, 2016USD ($) | Dec. 31, 2015USD ($) |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||||
NASDAQ listing rules, minimum closing bid price (USD per share) | $ / shares | $ 1 | $ 1 | |||||
NASDAQ listing rules, number of consecutive business days | 30 days | ||||||
NASDAQ listing rules, minimum market value of publicly held shares | $ 50,000,000 | ||||||
Stockholders' equity | $ 50,000,000 | $ (519,661,000) | $ (39,789,000) | ||||
Stock split, conversion ratio | 0.1 | 0.1 |
Subsequent Events (Details)
Subsequent Events (Details) - USD ($) | Oct. 20, 2016 | Sep. 30, 2016 | Sep. 30, 2015 | Dec. 31, 2015 |
Subsequent Event [Line Items] | ||||
Proceeds from sale of property | $ 0 | $ 11,643,000 | ||
Tug Hill | Scenario, Forecast | Disposal Group, Disposed of by Sale | ||||
Subsequent Event [Line Items] | ||||
Escrow deposit | $ 31,000,000 | |||
7 1⁄2% Senior Notes due 2022 | ||||
Subsequent Event [Line Items] | ||||
Interest rate | 7.50% | |||
Senior Notes | 7 1⁄2% Senior Notes due 2022 | ||||
Subsequent Event [Line Items] | ||||
Interest rate | 7.50% | |||
RSA | Scenario, Forecast | ||||
Subsequent Event [Line Items] | ||||
Elimination of debt outstanding | 850,000,000 | |||
Reduction in annual interest payments | 46,000,000 | |||
RSA | Senior Notes | 7 1⁄2% Senior Notes due 2022 | ||||
Subsequent Event [Line Items] | ||||
Interest rate | 7.50% | |||
Subsequent Event | Tug Hill | Disposal Group, Disposed of by Sale | ||||
Subsequent Event [Line Items] | ||||
Proceeds from sale of property | 360,000,000 | |||
Escrow deposit | 5,000,000 | |||
Maximum title and environmental defect loss | $ 10,000,000 | |||
Period for court approval of PSA and other matters | 30 days | |||
Subsequent Event | RSA | ||||
Subsequent Event [Line Items] | ||||
Minimum percentage of decrease in debt outstanding | 66.66% | |||
Percentage of decrease in debt outstanding | 85.40% | |||
Percentage of common stock issued in reorganization | 95.00% | |||
Percentage of common stock issued in reorganization to existing shareholders | 5.00% | |||
Repayments of debt | $ 225,000,000 | |||
Percentage of warrants issued in reorganization | 15.00% | |||
Subsequent Event | RSA | Minimum | ||||
Subsequent Event [Line Items] | ||||
Estimate of unsecured claims | $ 17,000,000 | |||
Subsequent Event | RSA | Maximum | ||||
Subsequent Event [Line Items] | ||||
Estimate of unsecured claims | 27,000,000 | |||
Subsequent Event | RSA | Appalachia regions of Pennsylvania and West Virginia | ||||
Subsequent Event [Line Items] | ||||
Minimum proceeds from sale property | 350,000,000 | |||
Minimum payment of net cash proceeds from the sale of properties | $ 150,000,000 | |||
Payment of excess net cash proceeds from sale of properties | 85.00% |
Guarantor Financial Statement55
Guarantor Financial Statements - Condensed Consolidating Balance Sheet (Details) - USD ($) $ in Thousands | Sep. 30, 2016 | Jul. 01, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Dec. 31, 2014 |
Current assets: | |||||
Cash and cash equivalents | $ 182,399 | $ 10,759 | $ 74,474 | $ 74,488 | |
Accounts receivable | 44,063 | 48,031 | |||
Fair value of derivative contracts | 6,261 | 38,576 | |||
Current income tax receivable | 19,863 | 46,174 | |||
Other current assets | 11,176 | 6,881 | |||
Total current assets | 263,762 | 150,421 | |||
Oil and gas properties, full cost method: | |||||
Proved | 9,564,561 | 9,375,898 | |||
Less: accumulated DD&A | (9,054,069) | (8,603,955) | |||
Net proved oil and gas properties | 510,492 | 771,943 | |||
Unevaluated | 404,226 | 440,043 | |||
Other property and equipment, net | 27,227 | 29,289 | |||
Other assets, net | 29,800 | 18,473 | |||
Investment in subsidiary | 0 | 0 | |||
Total assets | 1,235,507 | 1,410,169 | |||
Current liabilities: | |||||
Accounts payable to vendors | 29,259 | 82,207 | |||
Undistributed oil and gas proceeds | 7,439 | 5,992 | |||
Accrued interest | 22,917 | 9,022 | |||
Asset retirement obligations | 60,223 | 21,291 | |||
Current portion of long-term debt | 292,795 | 0 | |||
Other current liabilities | 10,903 | 40,712 | |||
Total current liabilities | 423,536 | 159,224 | |||
Long-term debt | 1,122,945 | 1,060,955 | |||
Asset retirement obligations | 182,816 | 204,575 | |||
Other long-term liabilities | 25,871 | 25,204 | |||
Total liabilities | 1,755,168 | 1,449,958 | |||
Commitments and contingencies | |||||
Stockholders’ equity: | |||||
Common stock | 56 | 55 | |||
Treasury stock | (860) | (860) | |||
Additional paid-in capital | 1,657,028 | 1,648,687 | |||
Accumulated deficit | (2,179,803) | (1,705,623) | |||
Accumulated other comprehensive income (loss) | 3,918 | 17,952 | |||
Total stockholders’ equity | (519,661) | $ 50,000 | (39,789) | ||
Total liabilities and stockholders’ equity | 1,235,507 | 1,410,169 | |||
Eliminations | |||||
Current assets: | |||||
Cash and cash equivalents | 0 | 0 | 0 | 0 | |
Accounts receivable | (14,892) | (1,756) | |||
Fair value of derivative contracts | 0 | 0 | |||
Current income tax receivable | 0 | 0 | |||
Other current assets | 0 | 0 | |||
Total current assets | (14,892) | (1,756) | |||
Oil and gas properties, full cost method: | |||||
Proved | 0 | 0 | |||
Less: accumulated DD&A | 0 | 0 | |||
Net proved oil and gas properties | 0 | 0 | |||
Unevaluated | 0 | 0 | |||
Other property and equipment, net | 0 | 0 | |||
Other assets, net | 0 | 0 | |||
Investment in subsidiary | (480,971) | (746,121) | |||
Total assets | (495,863) | (747,877) | |||
Current liabilities: | |||||
Accounts payable to vendors | (14,893) | (1,757) | |||
Undistributed oil and gas proceeds | 0 | 0 | |||
Accrued interest | 0 | 0 | |||
Asset retirement obligations | 0 | 0 | |||
Current portion of long-term debt | 0 | ||||
Other current liabilities | 0 | 0 | |||
Total current liabilities | (14,893) | (1,757) | |||
Long-term debt | 0 | 0 | |||
Asset retirement obligations | 0 | 0 | |||
Other long-term liabilities | 0 | 0 | |||
Total liabilities | (14,893) | (1,757) | |||
Commitments and contingencies | |||||
Stockholders’ equity: | |||||
Common stock | 0 | 0 | |||
Treasury stock | 0 | 0 | |||
Additional paid-in capital | (1,453,656) | (1,454,372) | |||
Accumulated deficit | 976,604 | 720,130 | |||
Accumulated other comprehensive income (loss) | (3,918) | (11,878) | |||
Total stockholders’ equity | (480,970) | (746,120) | |||
Total liabilities and stockholders’ equity | (495,863) | (747,877) | |||
Parent | |||||
Current assets: | |||||
Cash and cash equivalents | 152,384 | 9,681 | 63,322 | 72,886 | |
Accounts receivable | 17,336 | 10,597 | |||
Fair value of derivative contracts | 0 | 0 | |||
Current income tax receivable | 19,863 | 46,174 | |||
Other current assets | 11,176 | 6,848 | |||
Total current assets | 200,759 | 73,300 | |||
Oil and gas properties, full cost method: | |||||
Proved | 1,932,435 | 1,875,152 | |||
Less: accumulated DD&A | (1,932,640) | (1,874,622) | |||
Net proved oil and gas properties | (205) | 530 | |||
Unevaluated | 261,101 | 253,308 | |||
Other property and equipment, net | 27,227 | 29,289 | |||
Other assets, net | 28,852 | 16,612 | |||
Investment in subsidiary | 480,971 | 745,033 | |||
Total assets | 998,705 | 1,118,072 | |||
Current liabilities: | |||||
Accounts payable to vendors | 35,189 | 16,063 | |||
Undistributed oil and gas proceeds | 6,535 | 5,216 | |||
Accrued interest | 22,917 | 9,022 | |||
Asset retirement obligations | 0 | 0 | |||
Current portion of long-term debt | 292,795 | ||||
Other current liabilities | 10,778 | 40,161 | |||
Total current liabilities | 368,214 | 70,462 | |||
Long-term debt | 1,122,945 | 1,060,955 | |||
Asset retirement obligations | 1,336 | 1,240 | |||
Other long-term liabilities | 25,871 | 25,204 | |||
Total liabilities | 1,518,366 | 1,157,861 | |||
Commitments and contingencies | |||||
Stockholders’ equity: | |||||
Common stock | 56 | 55 | |||
Treasury stock | (860) | (860) | |||
Additional paid-in capital | 1,657,028 | 1,648,687 | |||
Accumulated deficit | (2,179,803) | (1,705,623) | |||
Accumulated other comprehensive income (loss) | 3,918 | 17,952 | |||
Total stockholders’ equity | (519,661) | (39,789) | |||
Total liabilities and stockholders’ equity | 998,705 | 1,118,072 | |||
Guarantor Subsidiary | |||||
Current assets: | |||||
Cash and cash equivalents | 30,015 | 2 | 10,042 | 1,450 | |
Accounts receivable | 40,736 | 39,190 | |||
Fair value of derivative contracts | 6,261 | 38,576 | |||
Current income tax receivable | 0 | 0 | |||
Other current assets | 0 | 0 | |||
Total current assets | 77,012 | 77,768 | |||
Oil and gas properties, full cost method: | |||||
Proved | 7,586,930 | 7,458,262 | |||
Less: accumulated DD&A | (7,076,233) | (6,686,849) | |||
Net proved oil and gas properties | 510,697 | 771,413 | |||
Unevaluated | 143,125 | 186,735 | |||
Other property and equipment, net | 0 | 0 | |||
Other assets, net | 948 | 826 | |||
Investment in subsidiary | 0 | 0 | |||
Total assets | 731,782 | 1,036,742 | |||
Current liabilities: | |||||
Accounts payable to vendors | 8,963 | 67,901 | |||
Undistributed oil and gas proceeds | 904 | 776 | |||
Accrued interest | 0 | 0 | |||
Asset retirement obligations | 60,223 | 20,400 | |||
Current portion of long-term debt | 0 | ||||
Other current liabilities | 125 | 551 | |||
Total current liabilities | 70,215 | 89,628 | |||
Long-term debt | 0 | 0 | |||
Asset retirement obligations | 181,480 | 203,335 | |||
Other long-term liabilities | 0 | 0 | |||
Total liabilities | 251,695 | 292,963 | |||
Commitments and contingencies | |||||
Stockholders’ equity: | |||||
Common stock | 0 | 0 | |||
Treasury stock | 0 | 0 | |||
Additional paid-in capital | 1,344,577 | 1,344,577 | |||
Accumulated deficit | (868,408) | (624,824) | |||
Accumulated other comprehensive income (loss) | 3,918 | 24,026 | |||
Total stockholders’ equity | 480,087 | 743,779 | |||
Total liabilities and stockholders’ equity | 731,782 | 1,036,742 | |||
Non- Guarantor Subsidiaries | |||||
Current assets: | |||||
Cash and cash equivalents | 0 | 1,076 | $ 1,110 | $ 152 | |
Accounts receivable | 883 | 0 | |||
Fair value of derivative contracts | 0 | 0 | |||
Current income tax receivable | 0 | 0 | |||
Other current assets | 0 | 33 | |||
Total current assets | 883 | 1,109 | |||
Oil and gas properties, full cost method: | |||||
Proved | 45,196 | 42,484 | |||
Less: accumulated DD&A | (45,196) | (42,484) | |||
Net proved oil and gas properties | 0 | 0 | |||
Unevaluated | 0 | 0 | |||
Other property and equipment, net | 0 | 0 | |||
Other assets, net | 0 | 1,035 | |||
Investment in subsidiary | 0 | 1,088 | |||
Total assets | 883 | 3,232 | |||
Current liabilities: | |||||
Accounts payable to vendors | 0 | 0 | |||
Undistributed oil and gas proceeds | 0 | 0 | |||
Accrued interest | 0 | 0 | |||
Asset retirement obligations | 0 | 891 | |||
Current portion of long-term debt | 0 | ||||
Other current liabilities | 0 | 0 | |||
Total current liabilities | 0 | 891 | |||
Long-term debt | 0 | 0 | |||
Asset retirement obligations | 0 | 0 | |||
Other long-term liabilities | 0 | 0 | |||
Total liabilities | 0 | 891 | |||
Commitments and contingencies | |||||
Stockholders’ equity: | |||||
Common stock | 0 | 0 | |||
Treasury stock | 0 | 0 | |||
Additional paid-in capital | 109,079 | 109,795 | |||
Accumulated deficit | (108,196) | (95,306) | |||
Accumulated other comprehensive income (loss) | 0 | (12,148) | |||
Total stockholders’ equity | 883 | 2,341 | |||
Total liabilities and stockholders’ equity | $ 883 | $ 3,232 |
Guarantor Financial Statement56
Guarantor Financial Statements - Condensed Consolidating Statement of Operations (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Operating revenue: | ||||
Oil production | $ 71,116 | $ 105,013 | $ 204,102 | $ 324,105 |
Natural gas production | 15,601 | 17,367 | 43,327 | 72,611 |
Natural gas liquids production | 6,666 | 5,980 | 15,119 | 29,379 |
Other operational income | 1,044 | 1,392 | 1,737 | 3,184 |
Derivative income, net | 0 | 2,444 | 0 | 4,871 |
Total operating revenue | 94,427 | 132,196 | 264,285 | 434,150 |
Operating expenses: | ||||
Lease operating expenses | 16,976 | 24,244 | 55,349 | 79,250 |
Transportation, processing and gathering expenses | 10,633 | 18,208 | 18,657 | 55,851 |
Production taxes | 835 | 2,052 | 1,894 | 6,394 |
Depreciation, depletion and amortization | 58,918 | 61,936 | 166,707 | 226,309 |
Write-down of oil and gas properties | 36,484 | 295,679 | 284,337 | 1,011,385 |
Accretion expense | 10,082 | 6,498 | 30,147 | 19,315 |
Salaries, general and administrative expenses | 15,425 | 19,552 | 48,193 | 52,977 |
Incentive compensation expense | 2,160 | 794 | 11,809 | 3,621 |
Restructuring fees | 5,784 | 0 | 16,173 | 0 |
Other operational expenses | 9,059 | 442 | 49,266 | 1,612 |
Derivative expense, net | 199 | 0 | 687 | 0 |
Total operating expenses | 166,555 | 429,405 | 683,219 | 1,456,714 |
Loss from operations | (72,128) | (297,209) | (418,934) | (1,022,564) |
Other (income) expenses: | ||||
Interest expense | 16,924 | 10,872 | 49,764 | 31,709 |
Interest income | (58) | (47) | (474) | (235) |
Other income | (272) | (411) | (840) | (1,167) |
Other expense | 16 | 148 | 27 | 148 |
(Income) loss from investment in subsidiaries | 0 | 0 | 0 | 0 |
Total other expenses | 16,610 | 10,562 | 48,477 | 30,455 |
Loss before income taxes | (88,738) | (307,771) | (467,411) | (1,053,019) |
Provision (benefit) for income taxes: | ||||
Current | (991) | 0 | (4,178) | 0 |
Deferred | 1,888 | (15,806) | 10,947 | (280,760) |
Total income taxes | 897 | (15,806) | 6,769 | (280,760) |
Net loss | (89,635) | (291,965) | (474,180) | (772,259) |
Comprehensive income (loss) | (93,102) | (297,564) | (488,214) | (820,517) |
Eliminations | ||||
Operating revenue: | ||||
Oil production | 0 | 0 | 0 | 0 |
Natural gas production | 0 | 0 | 0 | 0 |
Natural gas liquids production | 0 | 0 | 0 | 0 |
Other operational income | 0 | 0 | 0 | 0 |
Derivative income, net | 0 | 0 | ||
Total operating revenue | 0 | 0 | 0 | 0 |
Operating expenses: | ||||
Lease operating expenses | 0 | 0 | 0 | 0 |
Transportation, processing and gathering expenses | 0 | 0 | 0 | 0 |
Production taxes | 0 | 0 | 0 | 0 |
Depreciation, depletion and amortization | 0 | 0 | 0 | 0 |
Write-down of oil and gas properties | 0 | 0 | 0 | 0 |
Accretion expense | 0 | 0 | 0 | 0 |
Salaries, general and administrative expenses | 0 | 0 | 0 | 0 |
Incentive compensation expense | 0 | 0 | 0 | 0 |
Restructuring fees | 0 | 0 | ||
Other operational expenses | 0 | 0 | 0 | 0 |
Derivative expense, net | 0 | 0 | ||
Total operating expenses | 0 | 0 | 0 | 0 |
Loss from operations | 0 | 0 | 0 | 0 |
Other (income) expenses: | ||||
Interest expense | 0 | 0 | 0 | 0 |
Interest income | 0 | 0 | 0 | 0 |
Other income | 0 | 0 | 0 | 0 |
Other expense | 0 | 0 | 0 | 0 |
(Income) loss from investment in subsidiaries | (19,301) | 211,701 | (256,474) | 227,957 |
Total other expenses | (19,301) | 211,701 | (256,474) | 227,957 |
Loss before income taxes | 19,301 | (211,701) | 256,474 | (227,957) |
Provision (benefit) for income taxes: | ||||
Current | 0 | 0 | ||
Deferred | 0 | 0 | 0 | 0 |
Total income taxes | 0 | 0 | 0 | 0 |
Net loss | 19,301 | (211,701) | 256,474 | (227,957) |
Comprehensive income (loss) | 19,301 | (211,701) | 256,474 | (227,957) |
Parent | ||||
Operating revenue: | ||||
Oil production | 3,587 | 1,633 | 4,971 | 12,487 |
Natural gas production | 7,216 | 7,111 | 13,642 | 39,375 |
Natural gas liquids production | 5,737 | 3,502 | 9,246 | 21,458 |
Other operational income | 1,044 | 1,392 | 1,737 | 3,184 |
Derivative income, net | 0 | 0 | ||
Total operating revenue | 17,584 | 13,638 | 29,596 | 76,504 |
Operating expenses: | ||||
Lease operating expenses | 2,771 | 2,680 | 9,313 | 12,767 |
Transportation, processing and gathering expenses | 9,607 | 13,697 | 17,174 | 47,779 |
Production taxes | 669 | 1,777 | 1,311 | 5,411 |
Depreciation, depletion and amortization | 26,388 | 27,518 | 45,452 | 113,682 |
Write-down of oil and gas properties | 1 | 295,679 | 15,859 | 966,216 |
Accretion expense | 58 | 92 | 174 | 274 |
Salaries, general and administrative expenses | 15,425 | 19,348 | 48,392 | 52,747 |
Incentive compensation expense | 2,160 | 794 | 11,809 | 3,621 |
Restructuring fees | 5,784 | 16,173 | ||
Other operational expenses | 9,214 | 142 | 43,059 | 1,312 |
Derivative expense, net | 0 | 0 | ||
Total operating expenses | 72,077 | 361,727 | 208,716 | 1,203,809 |
Loss from operations | (54,493) | (348,089) | (179,120) | (1,127,305) |
Other (income) expenses: | ||||
Interest expense | 16,924 | 10,871 | 49,764 | 31,687 |
Interest income | (43) | (39) | (459) | (186) |
Other income | (64) | (117) | (123) | (437) |
Other expense | 16 | 148 | 27 | 148 |
(Income) loss from investment in subsidiaries | 19,300 | (227,973) | 250,029 | (273,147) |
Total other expenses | 36,133 | (217,110) | 299,238 | (241,935) |
Loss before income taxes | (90,626) | (130,979) | (478,358) | (885,370) |
Provision (benefit) for income taxes: | ||||
Current | (991) | (4,178) | ||
Deferred | 0 | 160,986 | 0 | (113,111) |
Total income taxes | (991) | 160,986 | (4,178) | (113,111) |
Net loss | (89,635) | (291,965) | (474,180) | (772,259) |
Comprehensive income (loss) | (93,102) | (297,564) | (488,214) | (820,517) |
Guarantor Subsidiary | ||||
Operating revenue: | ||||
Oil production | 67,529 | 103,380 | 199,131 | 311,618 |
Natural gas production | 8,385 | 10,256 | 29,685 | 33,236 |
Natural gas liquids production | 929 | 2,478 | 5,873 | 7,921 |
Other operational income | 0 | 0 | 0 | 0 |
Derivative income, net | 2,444 | 4,871 | ||
Total operating revenue | 76,843 | 118,558 | 234,689 | 357,646 |
Operating expenses: | ||||
Lease operating expenses | 14,205 | 21,562 | 46,023 | 66,481 |
Transportation, processing and gathering expenses | 1,026 | 4,511 | 1,483 | 8,072 |
Production taxes | 166 | 275 | 583 | 983 |
Depreciation, depletion and amortization | 32,530 | 34,418 | 121,255 | 112,627 |
Write-down of oil and gas properties | 36,483 | 0 | 268,128 | 0 |
Accretion expense | 10,024 | 6,406 | 29,973 | 19,041 |
Salaries, general and administrative expenses | 0 | 200 | (199) | 201 |
Incentive compensation expense | 0 | 0 | 0 | 0 |
Restructuring fees | 0 | 0 | ||
Other operational expenses | (155) | 300 | 125 | 300 |
Derivative expense, net | 199 | 687 | ||
Total operating expenses | 94,478 | 67,672 | 468,058 | 207,705 |
Loss from operations | (17,635) | 50,886 | (233,369) | 149,941 |
Other (income) expenses: | ||||
Interest expense | 0 | 1 | 0 | 22 |
Interest income | (15) | (7) | (15) | (42) |
Other income | (208) | (294) | (717) | (727) |
Other expense | 0 | 0 | 0 | 0 |
(Income) loss from investment in subsidiaries | 0 | 0 | 0 | 0 |
Total other expenses | (223) | (300) | (732) | (747) |
Loss before income taxes | (17,412) | 51,186 | (232,637) | 150,688 |
Provision (benefit) for income taxes: | ||||
Current | 0 | 0 | ||
Deferred | 1,888 | (193,059) | 10,947 | (167,649) |
Total income taxes | 1,888 | (193,059) | 10,947 | (167,649) |
Net loss | (19,300) | 244,245 | (243,584) | 318,337 |
Comprehensive income (loss) | (19,300) | 244,245 | (243,584) | 318,337 |
Non- Guarantor Subsidiaries | ||||
Operating revenue: | ||||
Oil production | 0 | 0 | 0 | 0 |
Natural gas production | 0 | 0 | 0 | 0 |
Natural gas liquids production | 0 | 0 | 0 | 0 |
Other operational income | 0 | 0 | 0 | 0 |
Derivative income, net | 0 | 0 | ||
Total operating revenue | 0 | 0 | 0 | 0 |
Operating expenses: | ||||
Lease operating expenses | 0 | 2 | 13 | 2 |
Transportation, processing and gathering expenses | 0 | 0 | 0 | 0 |
Production taxes | 0 | 0 | 0 | 0 |
Depreciation, depletion and amortization | 0 | 0 | 0 | 0 |
Write-down of oil and gas properties | 0 | 0 | 350 | 45,169 |
Accretion expense | 0 | 0 | 0 | 0 |
Salaries, general and administrative expenses | 0 | 4 | 0 | 29 |
Incentive compensation expense | 0 | 0 | 0 | 0 |
Restructuring fees | 0 | 0 | ||
Other operational expenses | 0 | 0 | 6,082 | 0 |
Derivative expense, net | 0 | 0 | ||
Total operating expenses | 0 | 6 | 6,445 | 45,200 |
Loss from operations | 0 | (6) | (6,445) | (45,200) |
Other (income) expenses: | ||||
Interest expense | 0 | 0 | 0 | 0 |
Interest income | 0 | (1) | 0 | (7) |
Other income | 0 | 0 | 0 | (3) |
Other expense | 0 | 0 | 0 | 0 |
(Income) loss from investment in subsidiaries | 1 | 16,272 | 6,445 | 45,190 |
Total other expenses | 1 | 16,271 | 6,445 | 45,180 |
Loss before income taxes | (1) | (16,277) | (12,890) | (90,380) |
Provision (benefit) for income taxes: | ||||
Current | 0 | 0 | ||
Deferred | 0 | 16,267 | 0 | 0 |
Total income taxes | 0 | 16,267 | 0 | 0 |
Net loss | (1) | (32,544) | (12,890) | (90,380) |
Comprehensive income (loss) | $ (1) | $ (32,544) | $ (12,890) | $ (90,380) |
Guarantor Financial Statement57
Guarantor Financial Statements - Condensed Consolidating Statement of Cash Flows (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Cash flows from operating activities: | ||||
Net loss | $ (89,635) | $ (291,965) | $ (474,180) | $ (772,259) |
Adjustments to reconcile net loss to net cash provided by operating activities: | ||||
Depreciation, depletion and amortization | 58,918 | 61,936 | 166,707 | 226,309 |
Write-down of oil and gas properties | 36,484 | 295,679 | 284,337 | 1,011,385 |
Accretion expense | 10,082 | 6,498 | 30,147 | 19,315 |
Deferred income tax provision (benefit) | 1,888 | (15,806) | 10,947 | (280,760) |
Settlement of asset retirement obligations | (15,106) | (59,826) | ||
Non-cash stock compensation expense | 6,407 | 9,163 | ||
Non-cash derivative expense | 1,261 | 10,854 | ||
Non-cash interest expense | 14,278 | 13,210 | ||
Other non-cash expense | 6,081 | 0 | ||
Change in current income taxes | 21,584 | 7,211 | ||
Non-cash loss from investment in subsidiaries | 0 | 0 | ||
Change in intercompany receivables/payables | 0 | 0 | ||
(Increase) decrease in accounts receivable | 3,968 | 33,895 | ||
Increase in other current assets | (4,426) | (1,090) | ||
(Increase) decrease in inventory | 0 | |||
Increase (decrease) in accounts payable | 3,217 | (11,592) | ||
Decrease in other current liabilities | (14,222) | (6,753) | ||
Other | (8,107) | (82) | ||
Net cash provided by operating activities | 32,893 | 198,980 | ||
Cash flows from investing activities: | ||||
Investment in oil and gas properties | (200,622) | (385,528) | ||
Proceeds from sale of oil and gas properties, net of expenses | 0 | 11,643 | ||
Investment in fixed and other assets | (1,231) | (1,455) | ||
Change in restricted funds | 1,046 | 179,475 | ||
Investment in subsidiaries | 0 | 0 | ||
Net cash used in investing activities | (200,807) | (195,865) | ||
Cash flows from financing activities: | ||||
Proceeds from bank borrowings | 477,000 | 5,000 | ||
Repayments of bank borrowings | (135,500) | (5,000) | ||
Repayments of building loan | (285) | 0 | ||
Deferred financing costs | (900) | 0 | ||
Equity proceeds from parent | 0 | 0 | ||
Net payments for share-based compensation | (752) | (3,127) | ||
Net cash provided by (used in) financing activities | 339,563 | (3,127) | ||
Effect of exchange rate changes on cash | (9) | (2) | ||
Net change in cash and cash equivalents | 171,640 | (14) | ||
Cash and cash equivalents, beginning of period | 10,759 | 74,488 | ||
Cash and cash equivalents, end of period | 182,399 | 74,474 | 182,399 | 74,474 |
Eliminations | ||||
Cash flows from operating activities: | ||||
Net loss | 19,301 | (211,701) | 256,474 | (227,957) |
Adjustments to reconcile net loss to net cash provided by operating activities: | ||||
Depreciation, depletion and amortization | 0 | 0 | 0 | 0 |
Write-down of oil and gas properties | 0 | 0 | 0 | 0 |
Accretion expense | 0 | 0 | 0 | 0 |
Deferred income tax provision (benefit) | 0 | 0 | 0 | 0 |
Settlement of asset retirement obligations | 0 | 0 | ||
Non-cash stock compensation expense | 0 | 0 | ||
Non-cash derivative expense | 0 | 0 | ||
Non-cash interest expense | 0 | 0 | ||
Other non-cash expense | 0 | |||
Change in current income taxes | 0 | 0 | ||
Non-cash loss from investment in subsidiaries | (256,474) | 227,957 | ||
Change in intercompany receivables/payables | 0 | 0 | ||
(Increase) decrease in accounts receivable | 0 | 0 | ||
Increase in other current assets | 0 | 0 | ||
(Increase) decrease in inventory | 0 | |||
Increase (decrease) in accounts payable | 0 | 0 | ||
Decrease in other current liabilities | 0 | 0 | ||
Other | 0 | 0 | ||
Net cash provided by operating activities | 0 | 0 | ||
Cash flows from investing activities: | ||||
Investment in oil and gas properties | 0 | 0 | ||
Proceeds from sale of oil and gas properties, net of expenses | 0 | |||
Investment in fixed and other assets | 0 | 0 | ||
Change in restricted funds | 0 | 0 | ||
Investment in subsidiaries | (716) | 9,708 | ||
Net cash used in investing activities | (716) | 9,708 | ||
Cash flows from financing activities: | ||||
Proceeds from bank borrowings | 0 | 0 | ||
Repayments of bank borrowings | 0 | 0 | ||
Repayments of building loan | 0 | |||
Deferred financing costs | 0 | |||
Equity proceeds from parent | 716 | (9,708) | ||
Net payments for share-based compensation | 0 | 0 | ||
Net cash provided by (used in) financing activities | 716 | (9,708) | ||
Effect of exchange rate changes on cash | 0 | 0 | ||
Net change in cash and cash equivalents | 0 | 0 | ||
Cash and cash equivalents, beginning of period | 0 | 0 | ||
Cash and cash equivalents, end of period | 0 | 0 | 0 | 0 |
Parent | ||||
Cash flows from operating activities: | ||||
Net loss | (89,635) | (291,965) | (474,180) | (772,259) |
Adjustments to reconcile net loss to net cash provided by operating activities: | ||||
Depreciation, depletion and amortization | 26,388 | 27,518 | 45,452 | 113,682 |
Write-down of oil and gas properties | 1 | 295,679 | 15,859 | 966,216 |
Accretion expense | 58 | 92 | 174 | 274 |
Deferred income tax provision (benefit) | 0 | 160,986 | 0 | (113,111) |
Settlement of asset retirement obligations | (78) | (15) | ||
Non-cash stock compensation expense | 6,407 | 9,163 | ||
Non-cash derivative expense | 0 | 0 | ||
Non-cash interest expense | 14,278 | 13,210 | ||
Other non-cash expense | 0 | |||
Change in current income taxes | 21,584 | 7,211 | ||
Non-cash loss from investment in subsidiaries | 250,029 | (273,147) | ||
Change in intercompany receivables/payables | (1,658) | 31,320 | ||
(Increase) decrease in accounts receivable | 7,966 | 29,561 | ||
Increase in other current assets | (4,459) | (1,050) | ||
(Increase) decrease in inventory | (2,415) | |||
Increase (decrease) in accounts payable | 7,385 | (7,562) | ||
Decrease in other current liabilities | (13,924) | (6,855) | ||
Other | (7,389) | 645 | ||
Net cash provided by operating activities | (132,554) | (5,132) | ||
Cash flows from investing activities: | ||||
Investment in oil and gas properties | (63,075) | (177,497) | ||
Proceeds from sale of oil and gas properties, net of expenses | 0 | |||
Investment in fixed and other assets | (1,231) | (1,455) | ||
Change in restricted funds | 0 | 177,647 | ||
Investment in subsidiaries | 0 | 0 | ||
Net cash used in investing activities | (64,306) | (1,305) | ||
Cash flows from financing activities: | ||||
Proceeds from bank borrowings | 477,000 | 5,000 | ||
Repayments of bank borrowings | (135,500) | (5,000) | ||
Repayments of building loan | (285) | |||
Deferred financing costs | (900) | |||
Equity proceeds from parent | 0 | 0 | ||
Net payments for share-based compensation | (752) | (3,127) | ||
Net cash provided by (used in) financing activities | 339,563 | (3,127) | ||
Effect of exchange rate changes on cash | 0 | 0 | ||
Net change in cash and cash equivalents | 142,703 | (9,564) | ||
Cash and cash equivalents, beginning of period | 9,681 | 72,886 | ||
Cash and cash equivalents, end of period | 152,384 | 63,322 | 152,384 | 63,322 |
Guarantor Subsidiary | ||||
Cash flows from operating activities: | ||||
Net loss | (19,300) | 244,245 | (243,584) | 318,337 |
Adjustments to reconcile net loss to net cash provided by operating activities: | ||||
Depreciation, depletion and amortization | 32,530 | 34,418 | 121,255 | 112,627 |
Write-down of oil and gas properties | 36,483 | 0 | 268,128 | 0 |
Accretion expense | 10,024 | 6,406 | 29,973 | 19,041 |
Deferred income tax provision (benefit) | 1,888 | (193,059) | 10,947 | (167,649) |
Settlement of asset retirement obligations | (14,129) | (59,811) | ||
Non-cash stock compensation expense | 0 | 0 | ||
Non-cash derivative expense | 1,261 | 10,854 | ||
Non-cash interest expense | 0 | 0 | ||
Other non-cash expense | 0 | |||
Change in current income taxes | 0 | 0 | ||
Non-cash loss from investment in subsidiaries | 0 | 0 | ||
Change in intercompany receivables/payables | 1,658 | (41,056) | ||
(Increase) decrease in accounts receivable | (3,116) | 4,317 | ||
Increase in other current assets | 0 | 0 | ||
(Increase) decrease in inventory | 2,415 | |||
Increase (decrease) in accounts payable | (4,168) | (4,030) | ||
Decrease in other current liabilities | (298) | 102 | ||
Other | (718) | (727) | ||
Net cash provided by operating activities | 167,209 | 194,420 | ||
Cash flows from investing activities: | ||||
Investment in oil and gas properties | (137,196) | (197,471) | ||
Proceeds from sale of oil and gas properties, net of expenses | 11,643 | |||
Investment in fixed and other assets | 0 | 0 | ||
Change in restricted funds | 0 | 0 | ||
Investment in subsidiaries | 0 | 0 | ||
Net cash used in investing activities | (137,196) | (185,828) | ||
Cash flows from financing activities: | ||||
Proceeds from bank borrowings | 0 | 0 | ||
Repayments of bank borrowings | 0 | 0 | ||
Repayments of building loan | 0 | |||
Deferred financing costs | 0 | |||
Equity proceeds from parent | 0 | 0 | ||
Net payments for share-based compensation | 0 | 0 | ||
Net cash provided by (used in) financing activities | 0 | 0 | ||
Effect of exchange rate changes on cash | 0 | 0 | ||
Net change in cash and cash equivalents | 30,013 | 8,592 | ||
Cash and cash equivalents, beginning of period | 2 | 1,450 | ||
Cash and cash equivalents, end of period | 30,015 | 10,042 | 30,015 | 10,042 |
Non- Guarantor Subsidiaries | ||||
Cash flows from operating activities: | ||||
Net loss | (1) | (32,544) | (12,890) | (90,380) |
Adjustments to reconcile net loss to net cash provided by operating activities: | ||||
Depreciation, depletion and amortization | 0 | 0 | 0 | 0 |
Write-down of oil and gas properties | 0 | 0 | 350 | 45,169 |
Accretion expense | 0 | 0 | 0 | 0 |
Deferred income tax provision (benefit) | 0 | 16,267 | 0 | 0 |
Settlement of asset retirement obligations | (899) | 0 | ||
Non-cash stock compensation expense | 0 | 0 | ||
Non-cash derivative expense | 0 | 0 | ||
Non-cash interest expense | 0 | 0 | ||
Other non-cash expense | 6,081 | |||
Change in current income taxes | 0 | 0 | ||
Non-cash loss from investment in subsidiaries | 6,445 | 45,190 | ||
Change in intercompany receivables/payables | 0 | 9,736 | ||
(Increase) decrease in accounts receivable | (882) | 17 | ||
Increase in other current assets | 33 | (40) | ||
(Increase) decrease in inventory | 0 | |||
Increase (decrease) in accounts payable | 0 | 0 | ||
Decrease in other current liabilities | 0 | 0 | ||
Other | 0 | 0 | ||
Net cash provided by operating activities | (1,762) | 9,692 | ||
Cash flows from investing activities: | ||||
Investment in oil and gas properties | (351) | (10,560) | ||
Proceeds from sale of oil and gas properties, net of expenses | 0 | |||
Investment in fixed and other assets | 0 | 0 | ||
Change in restricted funds | 1,046 | 1,828 | ||
Investment in subsidiaries | 716 | (9,708) | ||
Net cash used in investing activities | 1,411 | (18,440) | ||
Cash flows from financing activities: | ||||
Proceeds from bank borrowings | 0 | 0 | ||
Repayments of bank borrowings | 0 | 0 | ||
Repayments of building loan | 0 | |||
Deferred financing costs | 0 | |||
Equity proceeds from parent | (716) | 9,708 | ||
Net payments for share-based compensation | 0 | 0 | ||
Net cash provided by (used in) financing activities | (716) | 9,708 | ||
Effect of exchange rate changes on cash | (9) | (2) | ||
Net change in cash and cash equivalents | (1,076) | 958 | ||
Cash and cash equivalents, beginning of period | 1,076 | 152 | ||
Cash and cash equivalents, end of period | $ 0 | $ 1,110 | $ 0 | $ 1,110 |