United States securities and exchange commission logo
August 17, 2021
Jason McGlynn
Senior Vice President and Chief Financial Officer
Amplify Energy Corporation
500 Dallas Street, Suite 1700
Houston, Texas 77002
Re: Amplify Energy
Corporation
Form 10-K for the
Fiscal Year ended December 31, 2020
Filed March 11,
2021
File No. 001-35512
Dear Mr. McGlynn:
We have reviewed your filing and have the following comments. In
some of our
comments, we may ask you to provide us with information so we may better
understand your
disclosure.
Please respond to these comments within ten business days by
providing the requested
information or advise us as soon as possible when you will respond. If
you do not believe our
comments apply to your facts and circumstances, please tell us why in
your response.
After reviewing your
response to these comments, we may have additional comments.
Form 10-K for the Fiscal Year ended December 31, 2020
Business
Our Oil and Natural Gas Data
Development of Proved Undeveloped Reserves, page 15
1. Please expand the
discussion of the changes in the net quantities of your proved
undeveloped reserves to
clearly identify the source of each change, e.g. revisions,
improved recovery,
extensions and discoveries, transfers to proved developed, sales and
acquisitions, and to
include an explanation relating to each of the items you identify. If
two or more unrelated
factors are combined to arrive at the overall change for an item, you
should separately
identify and quantify each material factor so that the change in net
reserve quantities
between periods is fully explained.
The disclosure of
revisions in previous estimates of your proved undeveloped reserves in
particular should
identify the changes associated with individual factors, such as changes
Jason McGlynn
FirstName LastNameJason McGlynn
Amplify Energy Corporation
Comapany
August 17, NameAmplify
2021 Energy Corporation
August
Page 2 17, 2021 Page 2
FirstName LastName
caused by commodity prices, costs, royalty adjustments, well
performance, unsuccessful
and/or uneconomic proved undeveloped locations, or the removal of
proved undeveloped
locations due to changes in a previously adopted development plan. You
may refer to
Item 1203(b) of Regulation S-K if you require further clarification or
guidance.
Please similarly revise your disclosures of changes in the net
quantities of total proved
reserves on page F-41, to address for each period the changes depicted
in each line item in
the reconciliation, other than production, to comply with FASB ASC
932-235-50-5.
2. We note your disclosure indicating that none of the 17.2 MMBoe in
proved undeveloped
reserves as of December 31, 2020 are scheduled to be developed on a
date more than five
years from the date these reserves were initially disclosed. However,
you also indicate that
during the twelve months ending December 31, 2020, you converted
approximately 0.1
MMBoe or approximately 0.4% of the proved undeveloped reserves as of
December 31,
2019. That rate of conversion suggests that you may not be able to
develop your proved
undeveloped reserves within five years of initial disclosure.
Please provide us with your development schedule, indicating for each
future annual
period, the number of gross wells to be drilled, the associated net
quantities of reserves,
and estimated capital expenditures necessary to convert such reserves
to developed
reserves, to include all of the proved undeveloped reserves disclosed
as of December 31,
2020, and describe any change made or expected to be made in the
schedule that would
deviate from the definition set forth in Rule 4-10(a)(31)(ii) of
Regulation S-X.
3. Tell us the extent to which all of the undeveloped locations in the
development schedule
requested in the preceding comment are part of a development plan that
is reviewed
annually and adopted by management, including approval by the Board,
if such approval
is required. Refer to Rule 4-10(a)(31)(ii) of Regulation S-X and the
Question 131.04 in
the Compliance and Disclosure Interpretations (C&DIs).
Undeveloped Acreage, page 17
4. You disclose that 3,849 net undeveloped acres or approximately 60% of
the total 6,456
net undeveloped acres in Oklahoma are subject to lease expiration by
the end of 2021.
Please tell us the extent to which you have assigned any proved
undeveloped reserves to
locations which are currently scheduled to be drilled after lease
expiration.
If there are material quantities of net proved undeveloped reserves
relating to such
locations, expand the disclosure here or in an appropriate section
elsewhere in your filing
to describe the uncertainty in reasonable detail, including the steps
and related costs that
would be necessary to extend the time to the expiration of such
leases, considering the
guidance in Rule 4-10(a)(26) of Regulation S-X and FASB ASC
932-235-50-10.
Jason McGlynn
Amplify Energy Corporation
August 17, 2021
Page 3
Exhibits and Financial Statement Schedules
Exhibit Number 99.1 Report of Cawley, Gillespie and Associates, Inc., page 68
5. The reserves report includes among its results of the evaluation line
items entitled
Miscellaneous Expenses 1, Miscellaneous Expenses 2, Other Deductions,
and
Investments. Please tell us the types of costs represented by each
line item shown in the
results of the evaluation table. You should also obtain and file a
revised reserves report
that describes this information as part of the primary economic
assumptions that are
required to be disclosed pursuant to Item 1202(a)(8)(v) of Regulation
S-K.
Financial Statements
Note 18 - Supplemental Oil and Gas Information (Unaudited), page F-39
6. We note your disclosure on page F-41 indicating that future costs used
in calculating the
standardized measure as of December 31, 2020 include the abandonment
costs for your
onshore and offshore properties.
Please tell us if such abandonment costs include all of the costs
relating to your properties
located in federal waters offshore Southern California that are
expected to be incurred in
connection with the removal of all fixed drilling equipment,
production facilities and the
related offshore platforms and pipelines, and the plugging and
abandonment of all wells,
active and inactive, and all reclamation and restoration associated
with abandonment.
Please submit a schedule quantifying the abandonment costs associated
with each of these
activities that are reflected in your standardized measure and if
applicable any incremental
costs that have been excluded in calculating your standardized
measure. If any such costs
have been excluded, please explain your rationale and describe any
disclosures that you
would propose, considering the guidance in FASB ASC 932-235-50-36.
We remind you that the company and its management are responsible for
the accuracy
and adequacy of their disclosures, notwithstanding any review, comments, action
or absence of
action by the staff.
You may contact John Hodgin, Petroleum Engineer, at (202) 551-3699 if
you have
questions regarding the comments. Please contact Karl Hiller, Branch Chief, at
(202) 551-3686
with any other questions.
FirstName LastNameJason McGlynn Sincerely,
Comapany NameAmplify Energy Corporation
Division of
Corporation Finance
August 17, 2021 Page 3 Office of
Energy & Transportation
FirstName LastName