Cover
Cover - shares | 9 Months Ended | |
Sep. 30, 2022 | Oct. 27, 2022 | |
Entity Information [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Sep. 30, 2022 | |
Document Transition Report | false | |
Entity File Number | 001-35049 | |
Entity Registrant Name | EARTHSTONE ENERGY, INC. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 84-0592823 | |
Entity Address, Address Line One | 1400 Woodloch Forest Drive | |
Entity Address, Address Line Two | Suite 300 | |
Entity Address, City or Town | The Woodlands | |
Entity Address, State or Province | TX | |
Entity Address, Postal Zip Code | 77380 | |
City Area Code | 281 | |
Local Phone Number | 298-4246 | |
Title of 12(b) Security | Class A Common Stock, $0.001 par value per share | |
Trading Symbol | ESTE | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 139,678,567 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2022 | |
Document Fiscal Period Focus | Q3 | |
Entity Central Index Key | 0000010254 | |
Current Fiscal Year End Date | --12-31 | |
Class A Common Stock | ||
Entity Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 105,416,926 | |
Class B Common Stock | ||
Entity Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 34,261,641 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Current assets: | ||
Cash | $ 0 | $ 4,013 |
Accounts receivable: | ||
Oil, natural gas, and natural gas liquids revenues | 196,941 | 50,575 |
Joint interest billings and other, net of allowance of $19 and $19 at September 30, 2022 and December 31, 2021, respectively | 20,328 | 2,930 |
Derivative asset | 14,950 | 1,348 |
Prepaid expenses and other current assets | 19,089 | 2,549 |
Total current assets | 251,308 | 61,415 |
Oil and gas properties, successful efforts method: | ||
Proved properties | 3,832,991 | 1,625,367 |
Unproved properties | 290,111 | 222,025 |
Land | 5,482 | 5,382 |
Total oil and gas properties | 4,128,584 | 1,852,774 |
Accumulated depreciation, depletion and amortization | (516,662) | (395,625) |
Net oil and gas properties | 3,611,922 | 1,457,149 |
Other noncurrent assets: | ||
Office and other equipment, net of accumulated depreciation and amortization of $5,059 and $4,547 at September 30, 2022 and December 31, 2021, respectively | 5,070 | 1,986 |
Derivative asset | 5,526 | 157 |
Operating lease right-of-use assets | 2,255 | 1,795 |
Other noncurrent assets | 16,216 | 33,865 |
TOTAL ASSETS | 3,892,297 | 1,556,367 |
Current liabilities: | ||
Accounts payable | 75,162 | 31,397 |
Revenues and royalties payable | 158,867 | 36,189 |
Accrued expenses | 105,623 | 31,704 |
Asset retirement obligation | 941 | 395 |
Derivative liability | 28,404 | 45,310 |
Advances | 15,405 | 4,088 |
Operating lease liabilities | 869 | 681 |
Finance lease liabilities | 784 | 0 |
Other current liabilities | 4,105 | 851 |
Total current liabilities | 390,160 | 150,615 |
Noncurrent liabilities: | ||
Long-term debt, net | 1,174,549 | 320,000 |
Deferred tax liability | 93,322 | 15,731 |
Asset retirement obligation | 35,837 | 15,471 |
Derivative liability | 7,840 | 571 |
Operating lease liabilities | 1,549 | 1,276 |
Finance lease liabilities | 1,003 | 0 |
Other noncurrent liabilities | 13,574 | 6,442 |
Total noncurrent liabilities | 1,327,674 | 359,491 |
Commitments and Contingencies (Note 13) | ||
Equity: | ||
Preferred stock | 0 | 0 |
Additional paid-in capital | 1,382,026 | 718,181 |
Retained earnings (accumulated deficit) | 163,089 | (159,774) |
Total Earthstone Energy, Inc. equity | 1,545,257 | 558,494 |
Noncontrolling interest | 629,206 | 487,767 |
Total equity | 2,174,463 | 1,046,261 |
TOTAL LIABILITIES AND EQUITY | 3,892,297 | 1,556,367 |
Series A Convertible Preferred Stock | ||
Equity: | ||
Preferred stock | 0 | 0 |
Class A Common Stock | ||
Equity: | ||
Common stock | 108 | 53 |
Class B Common Stock | ||
Equity: | ||
Common stock | $ 34 | $ 34 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Allowance for credit loss | $ (19) | $ (19) |
Office and other equipment, accumulated depreciation | $ (5,059) | $ (4,547) |
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized (in shares) | 20,000,000 | 20,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Series A Convertible Preferred Stock | ||
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized (in shares) | 0 | 0 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Class A Common Stock | ||
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized (in shares) | 200,000,000 | 200,000,000 |
Common stock, shares issued (in shares) | 108,416,926 | 53,467,307 |
Common stock, shares outstanding (in shares) | 108,416,926 | 53,467,307 |
Class B Common Stock | ||
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized (in shares) | 50,000,000 | 50,000,000 |
Common stock, shares issued (in shares) | 34,261,641 | 34,344,532 |
Common stock, shares outstanding (in shares) | 34,261,641 | 34,344,532 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
REVENUES | ||||
Total revenues | $ 531,495 | $ 110,384 | $ 1,200,196 | $ 275,627 |
OPERATING COSTS AND EXPENSES | ||||
Lease operating expense | 75,829 | 12,983 | 147,974 | 35,579 |
Production and ad valorem taxes | 40,219 | 7,225 | 87,729 | 17,428 |
Depreciation, depletion and amortization | 90,880 | 27,059 | 191,669 | 77,493 |
General and administrative expense | 14,188 | 7,650 | 40,571 | 25,200 |
Transaction costs | 1,778 | 293 | 12,118 | 2,906 |
Accretion of asset retirement obligations | 758 | 323 | 1,863 | 916 |
Exploration expense | 2,248 | 296 | 2,340 | 326 |
Total operating costs and expenses | 225,900 | 55,829 | 484,264 | 159,848 |
Gain on sale of oil and gas properties | 14,803 | 392 | 14,803 | 740 |
Income from operations | 320,398 | 54,947 | 730,735 | 116,519 |
OTHER INCOME (EXPENSE) | ||||
Interest expense, net | (20,988) | (3,050) | (42,931) | (7,668) |
Gain (loss) on derivative contracts, net | 60,286 | (33,128) | (141,101) | (117,566) |
Other income, net | 134 | 520 | 430 | 823 |
Total other income (expense) | 39,432 | (35,658) | (183,602) | (124,411) |
Income (loss) before income taxes | 359,830 | 19,289 | 547,133 | (7,892) |
Income tax (expense) benefit | (60,518) | (451) | (81,673) | 343 |
Net income (loss) | 299,312 | 18,838 | 465,460 | (7,549) |
Less: Net income (loss) attributable to noncontrolling interest | 87,856 | 8,420 | 142,597 | (3,263) |
Net income (loss) attributable to Earthstone Energy, Inc. | $ 211,456 | $ 10,418 | $ 322,863 | $ (4,286) |
Net income (loss) per common share attributable to Earthstone Energy, Inc.: | ||||
Basic (in dollars per share) | $ 2.01 | $ 0.21 | $ 3.91 | $ (0.09) |
Diluted (in dollars per share) | $ 1.94 | $ 0.20 | $ 3.61 | $ (0.09) |
Weighted average common shares outstanding: | ||||
Basic (in shares) | 105,254,778 | 49,243,185 | 82,483,635 | 45,406,952 |
Diluted (in shares) | 109,278,661 | 52,662,942 | 92,844,854 | 45,406,952 |
Oil | ||||
REVENUES | ||||
Total revenues | $ 332,036 | $ 74,051 | $ 756,420 | $ 205,788 |
Natural gas | ||||
REVENUES | ||||
Total revenues | 113,937 | 14,368 | 233,020 | 26,910 |
Natural gas liquids | ||||
REVENUES | ||||
Total revenues | $ 85,522 | $ 21,965 | $ 210,756 | $ 42,929 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Equity (Unaudited) - USD ($) $ in Thousands | Total | Series A Convertible Preferred Stock | Class A Common Stock | Class B Common Stock | Total Earthstone Energy, Inc. Equity | Preferred Stock Series A Convertible Preferred Stock | Common Stock Class A Common Stock | Common Stock Class B Common Stock | Additional Paid-in Capital | Additional Paid-in Capital Series A Convertible Preferred Stock | (Accumulated Deficit) Retained Earnings | Noncontrolling Interest |
Beginning balance (in shares) at Dec. 31, 2020 | 30,343,421 | 35,009,371 | ||||||||||
Beginning balance at Dec. 31, 2020 | $ 815,536 | $ 344,881 | $ 30 | $ 35 | $ 540,074 | $ (195,258) | $ 470,655 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||
Stock-based compensation expense - equity portion | 2,605 | 2,605 | 2,605 | |||||||||
Shares issued in connection with Acquisition (in shares) | 12,719,594 | |||||||||||
Shares issued in connection with Acquisition | 76,572 | 76,572 | $ 13 | 76,559 | ||||||||
Vesting of restricted stock units and performance units, net of taxes paid (in shares) | 463,495 | |||||||||||
Vesting of restricted stock units, net of taxes paid | 0 | |||||||||||
Shares retained by the Company in exchange for payment of recipient mandatory tax withholdings (in shares) | 257,764 | |||||||||||
Shares retained by the Company in exchange for payment of recipient mandatory tax withholdings | (2,080) | (2,080) | (2,080) | |||||||||
Cancellation of treasury shares (in shares) | (257,764) | |||||||||||
Conversion of convertible securities (in shares) | 578,031 | (578,031) | ||||||||||
Conversion of convertible securities | 0 | 7,758 | $ 1 | $ (1) | 7,758 | (7,758) | ||||||
Net income (loss) | (10,556) | (5,833) | (5,833) | (4,723) | ||||||||
Ending balance (in shares) at Mar. 31, 2021 | 44,104,541 | 34,431,340 | ||||||||||
Ending balance at Mar. 31, 2021 | 882,077 | 423,903 | $ 44 | $ 34 | 624,916 | (201,091) | 458,174 | |||||
Beginning balance (in shares) at Dec. 31, 2020 | 30,343,421 | 35,009,371 | ||||||||||
Beginning balance at Dec. 31, 2020 | 815,536 | 344,881 | $ 30 | $ 35 | 540,074 | (195,258) | 470,655 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||
Conversion of convertible securities (in shares) | 655,376 | |||||||||||
Net income (loss) | (7,549) | |||||||||||
Ending balance (in shares) at Sep. 30, 2021 | 50,692,057 | 34,353,995 | ||||||||||
Ending balance at Sep. 30, 2021 | 949,894 | 491,280 | $ 51 | $ 34 | 690,739 | (199,544) | 458,614 | |||||
Beginning balance (in shares) at Mar. 31, 2021 | 44,104,541 | 34,431,340 | ||||||||||
Beginning balance at Mar. 31, 2021 | 882,077 | 423,903 | $ 44 | $ 34 | 624,916 | (201,091) | 458,174 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||
Stock-based compensation expense - equity portion | 2,175 | 2,175 | 2,175 | |||||||||
Vesting of restricted stock units and performance units, net of taxes paid (in shares) | 155,058 | |||||||||||
Shares retained by the Company in exchange for payment of recipient mandatory tax withholdings (in shares) | 66,343 | |||||||||||
Shares retained by the Company in exchange for payment of recipient mandatory tax withholdings | (741) | (741) | (741) | |||||||||
Cancellation of treasury shares (in shares) | (66,343) | |||||||||||
Conversion of convertible securities (in shares) | 33,463 | (33,463) | ||||||||||
Conversion of convertible securities | 0 | 441 | 441 | (441) | ||||||||
Net income (loss) | (15,831) | (8,871) | (8,871) | (6,960) | ||||||||
Ending balance (in shares) at Jun. 30, 2021 | 44,293,062 | 34,397,877 | ||||||||||
Ending balance at Jun. 30, 2021 | 867,680 | 416,907 | $ 44 | $ 34 | 626,791 | (209,962) | 450,773 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||
Stock-based compensation expense - equity portion | 2,161 | 2,161 | 2,161 | |||||||||
Shares issued in connection with Acquisition (in shares) | 6,200,000 | |||||||||||
Shares issued in connection with Acquisition | 61,814 | 61,814 | $ 6 | 61,808 | ||||||||
Vesting of restricted stock units and performance units, net of taxes paid (in shares) | 155,113 | |||||||||||
Vesting of restricted stock units, net of taxes paid | 0 | $ 1 | (1) | |||||||||
Shares retained by the Company in exchange for payment of recipient mandatory tax withholdings (in shares) | 65,106 | |||||||||||
Shares retained by the Company in exchange for payment of recipient mandatory tax withholdings | (599) | (599) | (599) | |||||||||
Cancellation of treasury shares (in shares) | (65,106) | |||||||||||
Conversion of convertible securities (in shares) | 43,882 | 43,882 | (43,882) | |||||||||
Conversion of convertible securities | 0 | 579 | 579 | (579) | ||||||||
Net income (loss) | 18,838 | 10,418 | 10,418 | 8,420 | ||||||||
Ending balance (in shares) at Sep. 30, 2021 | 50,692,057 | 34,353,995 | ||||||||||
Ending balance at Sep. 30, 2021 | 949,894 | 491,280 | $ 51 | $ 34 | 690,739 | (199,544) | 458,614 | |||||
Beginning balance (in shares) at Dec. 31, 2021 | 0 | 53,467,307 | 34,344,532 | |||||||||
Beginning balance at Dec. 31, 2021 | 1,046,261 | 558,494 | $ 0 | $ 53 | $ 34 | 718,181 | (159,774) | 487,767 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||
Stock-based compensation expense - equity portion | 2,301 | 2,301 | 2,301 | |||||||||
Shares issued in connection with Acquisition (in shares) | 19,417,476 | |||||||||||
Shares issued in connection with Acquisition | 249,515 | 249,515 | $ 19 | 249,496 | ||||||||
Vesting of restricted stock units and performance units, net of taxes paid (in shares) | 483,251 | |||||||||||
Vesting of restricted stock units, net of taxes paid | 0 | $ 1 | (1) | |||||||||
Shares retained by the Company in exchange for payment of recipient mandatory tax withholdings (in shares) | 286,892 | |||||||||||
Shares retained by the Company in exchange for payment of recipient mandatory tax withholdings | (3,898) | (3,898) | (3,898) | |||||||||
Cancellation of treasury shares (in shares) | (286,892) | |||||||||||
Conversion of convertible securities (in shares) | 72,766 | (72,766) | ||||||||||
Conversion of convertible securities | 0 | 1,014 | 1,014 | (1,014) | ||||||||
Net income (loss) | (51,877) | (33,478) | (33,478) | (18,399) | ||||||||
Ending balance (in shares) at Mar. 31, 2022 | 0 | 73,440,800 | 34,271,766 | |||||||||
Ending balance at Mar. 31, 2022 | 1,242,302 | 773,948 | $ 0 | $ 73 | $ 34 | 967,093 | (193,252) | 468,354 | ||||
Beginning balance (in shares) at Dec. 31, 2021 | 0 | 53,467,307 | 34,344,532 | |||||||||
Beginning balance at Dec. 31, 2021 | 1,046,261 | 558,494 | $ 0 | $ 53 | $ 34 | 718,181 | (159,774) | 487,767 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||
Conversion of convertible securities (in shares) | 82,891 | |||||||||||
Net income (loss) | 465,460 | |||||||||||
Ending balance (in shares) at Sep. 30, 2022 | 0 | 108,416,926 | 34,261,641 | |||||||||
Ending balance at Sep. 30, 2022 | 2,174,463 | 1,545,257 | $ 0 | $ 108 | $ 34 | 1,382,026 | 163,089 | 629,206 | ||||
Beginning balance (in shares) at Mar. 31, 2022 | 0 | 73,440,800 | 34,271,766 | |||||||||
Beginning balance at Mar. 31, 2022 | 1,242,302 | 773,948 | $ 0 | $ 73 | $ 34 | 967,093 | (193,252) | 468,354 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||
Stock-based compensation expense - equity portion | 2,693 | 2,693 | 2,693 | |||||||||
Issuance of Series A Convertible Preferred Stock, net of offering costs (in shares) | 280,000 | |||||||||||
Issuance of Series A Convertible Preferred Stock, net of offering costs | 279,326 | 279,326 | 279,326 | |||||||||
Shares issued in connection with Acquisition (in shares) | 5,650,977 | |||||||||||
Shares issued in connection with Acquisition | 77,757 | 77,757 | $ 6 | 77,751 | ||||||||
Vesting of restricted stock units and performance units, net of taxes paid (in shares) | 115,521 | |||||||||||
Shares retained by the Company in exchange for payment of recipient mandatory tax withholdings (in shares) | 48,232 | |||||||||||
Shares retained by the Company in exchange for payment of recipient mandatory tax withholdings | (719) | (719) | (719) | |||||||||
Cancellation of treasury shares (in shares) | (48,232) | |||||||||||
Conversion of convertible securities (in shares) | 10,125 | (10,125) | ||||||||||
Conversion of convertible securities | 0 | 149 | 149 | (149) | ||||||||
Net income (loss) | 218,025 | 144,885 | 144,885 | 73,140 | ||||||||
Ending balance (in shares) at Jun. 30, 2022 | 280,000 | 79,217,423 | 34,261,641 | |||||||||
Ending balance at Jun. 30, 2022 | 1,819,384 | 1,278,039 | $ 0 | $ 79 | $ 34 | 1,326,293 | (48,367) | 541,345 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||
Stock-based compensation expense - equity portion | 2,745 | 2,745 | 2,745 | |||||||||
Shares issued in connection with Acquisition (in shares) | 3,857,015 | |||||||||||
Shares issued in connection with Acquisition | 53,574 | 53,574 | $ 4 | 53,570 | ||||||||
Vesting of restricted stock units and performance units, net of taxes paid (in shares) | 117,263 | |||||||||||
Vesting of restricted stock units, net of taxes paid | 0 | $ 0 | 0 | |||||||||
Shares retained by the Company in exchange for payment of recipient mandatory tax withholdings (in shares) | 48,073 | |||||||||||
Shares retained by the Company in exchange for payment of recipient mandatory tax withholdings | (552) | (552) | (552) | |||||||||
Cancellation of treasury shares (in shares) | (48,073) | |||||||||||
Conversion of convertible securities (in shares) | 0 | (280,000) | 25,225,225 | |||||||||
Conversion of convertible securities | 0 | $ 0 | (5) | $ 25 | (5) | $ (25) | 5 | |||||
Net income (loss) | 299,312 | 211,456 | 211,456 | 87,856 | ||||||||
Ending balance (in shares) at Sep. 30, 2022 | 0 | 108,416,926 | 34,261,641 | |||||||||
Ending balance at Sep. 30, 2022 | $ 2,174,463 | $ 1,545,257 | $ 0 | $ 108 | $ 34 | $ 1,382,026 | $ 163,089 | $ 629,206 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Cash flows from operating activities: | ||
Net income (loss) | $ 465,460 | $ (7,549) |
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | ||
Depreciation, depletion and amortization | 191,669 | 77,493 |
Accretion of asset retirement obligations | 1,863 | 916 |
Settlement of asset retirement obligations | (664) | (103) |
Gain on sale of oil and gas properties | (14,803) | (740) |
Gain on sale of office and other equipment | (152) | (114) |
Total loss on derivative contracts, net | 141,101 | 117,566 |
Operating portion of net cash paid in settlement of derivative contracts | (169,708) | (46,311) |
Stock-based compensation - equity and liability awards | 15,112 | 10,621 |
Deferred income taxes | 77,591 | (343) |
Amortization of deferred financing costs | 3,723 | 581 |
Changes in assets and liabilities: | ||
(Increase) decrease in accounts receivable | (189,504) | (12,238) |
(Increase) decrease in prepaid expenses and other current assets | (16,546) | 900 |
Increase (decrease) in accounts payable and accrued expenses | 92,450 | 6,090 |
Increase (decrease) in revenues and royalties payable | 94,260 | 2,556 |
Increase (decrease) in advances | 11,317 | (2,015) |
Net cash provided by operating activities | 703,169 | 147,310 |
Cash flows from investing activities: | ||
Acquisition of oil and gas properties, net of cash acquired | (1,518,269) | (240,431) |
Additions to oil and gas properties | (325,109) | (65,074) |
Additions to office and other equipment | (1,694) | (886) |
Proceeds from sales of oil and gas properties | 26,165 | 975 |
Net cash used in investing activities | (1,818,907) | (305,416) |
Cash flows from financing activities: | ||
Proceeds from borrowings under Credit Agreement | 2,348,728 | 503,734 |
Repayments of borrowings under Credit Agreement | (2,276,996) | (340,482) |
Proceeds from issuance of 8% Senior Notes due 2027, net | 537,256 | 0 |
Proceeds from term loan | 244,209 | 0 |
Proceeds from issuance of Series A Convertible Preferred Stock, net of offering costs of $674 | 279,326 | 0 |
Cash paid related to the exchange and cancellation of Class A Common Stock | (5,168) | (3,420) |
Cash paid for finance leases | (408) | (70) |
Deferred financing costs | (15,222) | (2,709) |
Net cash provided by financing activities | 1,111,725 | 157,053 |
Net decrease in cash | (4,013) | (1,053) |
Cash at beginning of period | 4,013 | 1,494 |
Cash at end of period | 0 | 441 |
Cash paid for: | ||
Interest | 17,485 | 7,126 |
Income taxes | 625 | 687 |
Non-cash investing and financing activities: | ||
Accrued capital expenditures | 40,969 | 18,971 |
Lease asset additions - ASC 842 | 3,111 | 0 |
Asset retirement obligations | 722 | 242 |
Chisholm Acquisition | ||
Non-cash investing and financing activities: | ||
Class A Common Stock issued in Acquisition | 249,515 | 0 |
Bighorn Acquisition | ||
Non-cash investing and financing activities: | ||
Class A Common Stock issued in Acquisition | 77,757 | 0 |
IRM Acquisition | ||
Non-cash investing and financing activities: | ||
Class A Common Stock issued in Acquisition | 0 | 76,572 |
Tracker/Sequel Acquisition | ||
Non-cash investing and financing activities: | ||
Class A Common Stock issued in Acquisition | 0 | 61,814 |
Titus Acquisition | ||
Non-cash investing and financing activities: | ||
Class A Common Stock issued in Acquisition | $ 53,574 | $ 0 |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Equity (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |
Apr. 14, 2022 | Jun. 30, 2022 | Sep. 30, 2022 | |
Statement of Stockholders' Equity [Abstract] | |||
Offering costs | $ 200 | $ 674 | $ 674 |
Condensed Consolidated Statem_5
Condensed Consolidated Statements of Cash Flows (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Apr. 14, 2022 | Jun. 30, 2022 | Sep. 30, 2022 | Apr. 12, 2022 | |
Offering costs | $ 200 | $ 674 | $ 674 | |
Senior Notes | 8.000% Senior Notes Due 2027 | ||||
Interest rate, stated percentage | 8% | 8% |
Basis of Presentation and Summa
Basis of Presentation and Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2022 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Summary of Significant Accounting Policies | Basis of Presentation and Summary of Significant Accounting Policies Earthstone Energy, Inc., a Delaware corporation (“Earthstone” and together with its consolidated subsidiaries, the “Company”), is a growth-oriented independent oil and natural gas development and production company. In addition, the Company is active in corporate mergers and the acquisition of oil and natural gas properties that have production and future development opportunities. The Company's operations are all in the upstream segment of the oil and natural gas industry and all its properties are onshore in Texas and New Mexico. Earthstone is the sole managing member of Earthstone Energy Holdings, LLC, a Delaware limited liability company (together with its wholly-owned consolidated subsidiaries, “EEH”), with a controlling interest in EEH. Earthstone, together with its wholly-owned subsidiary, Lynden Energy Corp., a corporation organized under the laws of British Columbia (“Lynden Corp”), and Lynden Corp’s wholly-owned consolidated subsidiary, Lynden USA Inc., a Utah corporation (“Lynden US”) and also a member of EEH, consolidates the financial results of EEH and records a noncontrolling interest in the Condensed Consolidated Financial Statements representing the economic interests of EEH's members other than Earthstone and Lynden US. The accompanying unaudited Condensed Consolidated Financial Statements and notes thereto have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission (“SEC”) applicable to interim financial statements. Pursuant to such rules and regulations, certain disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) have been omitted. The accompanying unaudited Condensed Consolidated Financial Statements and notes should be read in conjunction with the financial statements and notes included in Earthstone’s 2021 Annual Report on Form 10-K. The information furnished herein reflects all adjustments that are, in the opinion of management, necessary for the fair presentation of the Company's financial position, results of operations and cash flows for the periods presented. Any such adjustments are of a normal, recurring nature. The Company’s Condensed Consolidated Balance Sheet at December 31, 2021 is derived from the audited Consolidated Financial Statements at that date. |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 30, 2022 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements FASB Accounting Standards Codification (“ASC”) Topic 820, defines fair value as the price that would be received to sell an asset, or paid to transfer a liability, in an orderly transaction between market participants at the measurement date. ASC 820 provides a framework for measuring fair value, establishes a three-level hierarchy for fair value measurements based upon the transparency of inputs to the valuation of an asset or liability as of the measurement date and requires consideration of the counterparty’s creditworthiness when valuing certain assets. The three-level fair value hierarchy for disclosure of fair value measurements defined by ASC 820 is as follows: Level 1 – Unadjusted, quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities. An active market is defined as a market where transactions for the financial instrument occur with sufficient frequency and volume to provide pricing information on an ongoing basis. Level 2 – Inputs, other than quoted prices within Level 1, that are either directly or indirectly observable for the asset or liability through correlation with market data at the measurement date and for the duration of the instrument’s anticipated life. Level 3 – Prices or valuations that require unobservable inputs that are both significant to the fair value measurement and unobservable. Valuation under Level 3 generally involves a significant degree of judgment from management. A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. Where available, fair value is based on observable market prices or parameters or derived from such prices or parameters. Where observable prices or inputs are not available, valuation models are applied. These valuation techniques involve some level of management estimation and judgment, the degree of which is dependent on the price transparency for the instruments or market and the instrument’s complexity. The Company reflects transfers between the three levels at the beginning of the reporting period in which the availability of observable inputs no longer justifies classification in the original level. There were no transfers between fair value hierarchy levels for the nine months ended September 30, 2022. Fair Value on a Recurring Basis Derivative Financial Instruments Derivative financial instruments are carried at fair value and measured on a recurring basis. The derivative financial instruments consist of fixed price swap agreements, costless collars, deferred premium put options and interest rate swaps. The Company’s commodity price hedges and interest rate swaps are valued based on discounted future cash flow models that are primarily based on published forward commodity price curves and published LIBOR forward curves; thus, these inputs are designated as Level 2 within the valuation hierarchy. The fair values of derivative instruments in asset positions include measures of counterparty nonperformance risk, and the fair values of derivative instruments in liability positions include measures of the Company’s nonperformance risk. These measurements were not material to the Condensed Consolidated Financial Statements. Share-based Compensation Liability Certain of our performance-based stock awards (“PSUs” or “performance units”) may be payable in cash. The Company classifies the awards that may be settled in cash as liability awards. These awards are valued quarterly utilizing the Monte Carlo Simulation pricing model, which calculates multiple potential outcomes for an award and establishes grant date fair value based on the most likely outcome. The inputs for the Monte Carlo model are designated as Level 2 within the valuation hierarchy. The share-based compensation liability related to the PSU liability awards is included in Other noncurrent liabilities in the Condensed Consolidated Balance Sheet as of September 30, 2022. The following table summarizes the fair value of the Company’s financial assets and liabilities, by level within the fair-value hierarchy (in thousands) : September 30, 2022 Level 1 Level 2 Level 3 Total Financial assets Derivative asset - current $ — $ 14,950 $ — $ 14,950 Derivative asset - noncurrent — 5,526 — 5,526 Total financial assets $ — $ 20,476 $ — $ 20,476 Financial liabilities Derivative liability - current $ — $ 28,404 $ — $ 28,404 Derivative liability - noncurrent — 7,840 — 7,840 Share-based compensation liability - noncurrent — 13,474 — 13,474 Total financial liabilities $ — $ 49,718 $ — $ 49,718 December 31, 2021 Financial assets Derivative asset - current $ — $ 1,348 $ — $ 1,348 Derivative asset - noncurrent — 157 — 157 Total financial assets $ — $ 1,505 $ — $ 1,505 Financial liabilities Derivative liability - current $ — $ 45,310 $ — $ 45,310 Derivative liability - noncurrent — 571 — 571 Share-based compensation liability - current — 7,835 — 7,835 Share-based compensation liability - noncurrent — 6,324 — 6,324 Total financial liabilities $ — $ 60,040 $ — $ 60,040 Other financial instruments include cash, accounts receivable and payable, and revenue royalties. The carrying amount of these instruments approximates fair value because of their short-term nature. Fair Value on a Nonrecurring Basis The Company applies the provisions of the fair value measurement standard on a non-recurring basis to its non-financial assets and liabilities, including oil and gas properties, business combinations and asset retirement obligations. These assets and liabilities are not measured at fair value on an ongoing basis but are subject to fair value adjustments if events or changes in certain circumstances indicate that adjustments may be necessary. No triggering events that require assessment were observed during the nine months ended September 30, 2022. See further discussion in Note 5. Oil and Natural Gas Properties . Items Not Recorded at Fair Value The carrying amounts reported on the unaudited consolidated balance sheets for cash, accounts receivable, prepaid expenses, other current assets accounts payable, revenues and royalties payable, accrued expenses and other current liabilities approximate their fair values. |
Derivative Financial Instrument
Derivative Financial Instruments | 9 Months Ended |
Sep. 30, 2022 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Financial Instruments | Derivative Financial Instruments Commodity Derivative Instruments The Company’s hedging activities primarily consist of derivative instruments entered into in order to hedge against changes in oil and natural gas prices through the use of fixed price swap agreements, costless collars and deferred premium put options. Swaps exchange floating price risk in the future for a fixed price at the time of the hedge. Costless collars set both a maximum (sold ceiling) and a minimum (bought floor) future price. A deferred premium put option represents a bought floor except, unlike a standard put option, the premium is not paid until the expiration of the option. Consistent with its hedging policy, the Company has entered into a series of derivative instruments to hedge a significant portion of its expected oil and natural gas production through December 31, 2024. Typically, these derivative instruments require payments to (receipts from) counterparties based on specific indices as required by the derivative agreements. Although not risk free, the Company believes these instruments reduce its exposure to oil and natural gas price fluctuations and, thereby, allow the Company to achieve a more predictable cash flow. The Company does not enter into derivative instruments for trading or other speculative purposes. These transactions are recorded in the Condensed Consolidated Financial Statements in accordance with FASB ASC Topic 815. The Company has accounted for these transactions using the mark-to-market accounting method. Generally, the Company incurs accounting losses on derivatives during periods where prices are rising and gains during periods where prices are falling which may cause significant fluctuations in the Condensed Consolidated Balance Sheets and Condensed Consolidated Statements of Operations. The Company nets its derivative instrument fair value amounts executed with each counterparty pursuant to an International Swap Dealers Association Master Agreement (“ISDA”), which provides for net settlement over the term of the contract. The ISDA is a standard contract that governs all derivative contracts entered into between the Company and the respective counterparty. The ISDA allows for offsetting of amounts payable or receivable between the Company and the counterparty, at the election of both parties, for transactions that occur on the same date and in the same currency. The Company had the following open crude oil and natural gas derivative contracts as of September 30, 2022: Price Swaps Period Commodity Volume Weighted Average Price Q4 2022 Crude Oil 1,081,000 $ 66.70 Q1 - Q4 2023 Crude Oil 1,277,500 $ 76.20 Q4 2022 Crude Oil Basis Swap (1) 3,128,000 $ 0.89 Q1 - Q4 2023 Crude Oil Basis Swap (1) 9,488,500 $ 0.92 Q4 2022 Natural Gas 1,893,500 $ 3.33 Q1 - Q4 2023 Natural Gas 3,670,000 $ 3.35 Q4 2022 Natural Gas Basis Swap (2) 1,840,000 $ (0.33) Q1 - Q4 2023 Natural Gas Basis Swap (2) 36,500,000 $ (1.47) Q1 - Q4 2024 Natural Gas Basis Swap (2) 36,600,000 $ (1.05) (1) The basis differential price is between WTI Midland Crude and the WTI NYMEX. (2) The basis differential price is between W. Texas (WAHA) and the Henry Hub NYMEX. Costless Collars Period Commodity Volume Bought Floor Sold Ceiling Q4 2022 Crude Oil Costless Collar 805,000 $ 73.14 $ 96.49 Q1 - Q4 2023 Crude Oil Costless Collar 1,715,500 $ 62.98 $ 80.34 Q4 2022 Natural Gas Costless Collar 8,686,500 $ 4.57 $ 10.17 Q1 - Q4 2023 Natural Gas Costless Collar 17,298,000 $ 3.77 $ 7.49 Deferred Premium Puts Period Commodity Volume $/Bbl (Put Price) $/Bbl (Net of Premium) Q4 2022 Crude Oil 253,000 $ 80.00 $ 75.79 Q1 - Q4 2023 Crude Oil 1,750,500 $ 70.00 $ 64.53 The following table summarizes the location and fair value amounts of all derivative instruments in the Condensed Consolidated Balance Sheets as well as the gross recognized derivative assets, liabilities, and amounts offset in the Condensed Consolidated Balance Sheets (in thousands) : September 30, 2022 December 31, 2021 Derivatives not Balance Sheet Location Gross Gross Net Gross Gross Net Commodity contracts Derivative asset - current $ 53,601 $ (38,651) $ 14,950 $ 3,191 $ (1,843) $ 1,348 Commodity contracts Derivative liability - current $ 67,055 $ (38,651) $ 28,404 $ 47,153 $ (1,843) $ 45,310 Commodity contracts Derivative asset - noncurrent $ 12,941 $ (7,415) $ 5,526 $ 2,721 $ (2,564) $ 157 Commodity contracts Derivative liability - noncurrent $ 15,255 $ (7,415) $ 7,840 $ 3,135 $ (2,564) $ 571 The following table summarizes the location and amounts of the Company’s realized and unrealized gains and losses on derivatives instruments in the Condensed Consolidated Statements of Operations and Condensed Consolidated Statements of Cash Flows (in thousands) : Derivatives not designated as hedging contracts under ASC Topic 815 Three Months Ended Nine Months Ended Statement of Cash Flows Location Statement of Operations Location 2022 2021 2022 2021 Unrealized gain (loss) Not separately presented Not separately presented $ 119,209 $ (12,244) $ 28,607 $ (71,255) Realized loss Operating portion of net cash paid in settlement of derivative contracts Not separately presented (58,923) (20,884) (169,708) (46,311) Total (gain) loss on derivative contracts, net Gain (loss) on derivative contracts, net $ 60,286 $ (33,128) $ (141,101) $ (117,566) |
Acquisitions and Divestitures
Acquisitions and Divestitures | 9 Months Ended |
Sep. 30, 2022 | |
Business Combination, Asset Acquisition and Divestitures [Abstract] | |
Acquisitions and Divestitures | Acquisitions and Divestitures Titus Agreement On June 27, 2022, Earthstone and EEH, together as buyer, and Titus Oil & Gas Production, LLC, a Delaware limited liability company, Titus Oil & Gas Corporation, a Delaware corporation, Lenox Minerals, LLC, a Delaware limited liability company and Lenox Mineral Title Holdings, Inc., a Delaware corporation (collectively, “Titus I”), as seller, entered into a purchase and sale agreement (the “Titus I Purchase Agreement”) which provided that EEH or its designated wholly-owned subsidiary would acquire (the “Titus I Acquisition”) interests in oil and gas leases and related property of Titus I located in the Northern Delaware Basin of New Mexico (the “Titus I Assets”). Also on June 27, 2022, Earthstone and EEH, as buyer, and Titus Oil & Gas Production II, LLC, a Delaware limited liability company, Lenox Minerals II, LLC, a Delaware limited liability company and Lenox Mineral Holdings II, Inc., a Delaware limited liability company (collectively, “Titus II” and together with Titus I, “Titus”), as seller, entered into a purchase and sale agreement (the “Titus II Purchase Agreement” and together with the Titus I Purchase Agreement, the “Titus Purchase Agreements”) which provided that EEH or its designated wholly-owned subsidiary would acquire (the “Titus II Acquisition” and together with the Titus I Acquisition, the “Titus Acquisition”) interests in oil and gas leases and related property of Titus II located in the Northern Delaware Basin of New Mexico (the “Titus II Assets” and together with the Titus I Assets, the “Titus Assets”). On August 10, 2022, the transactions contemplated in the Titus Purchase Agreements were consummated whereby EEH acquired the Titus Assets for aggregate consideration of approximately $565.8 million in cash, net of preliminary and customary purchase price adjustments and remains subject to final post-closing settlement between EEH and Titus, and 3,857,015 shares Class A Common Stock (the “Titus Acquisition”). The Titus Acquisition has been accounted for as a business combination using the acquisition method of accounting, with Earthstone identified as the acquirer. The preliminary allocation of the total purchase price in the Titus Acquisition is based upon management’s estimates of and assumptions related to the fair value of assets acquired and liabilities assumed. Although the purchase price allocation is substantially complete as of the date of this filing, there may be further adjustments to the Company’s estimates of the acquired oil and gas properties resulting in changes to the purchase price allocation. These amounts will be finalized no later than one year from the acquisition date. The consideration transferred, fair value of assets acquired and liabilities assumed by Earthstone were recorded as follows (in thousands, except share amounts and stock price): Consideration: Shares of Class A Common Stock issued 3,857,015 Class A Common Stock price as of August 10, 2022 $ 13.89 Class A Common Stock consideration 53,574 Cash consideration 565,777 Total consideration transferred $ 619,351 Fair value of assets acquired: Oil and gas properties $ 623,119 Amount attributable to assets acquired $ 623,119 Fair value of liabilities assumed: Current liabilities $ 2,854 Noncurrent liabilities - ARO 914 Amount attributable to liabilities assumed $ 3,768 Bighorn Acquisition On January 30, 2022, Earthstone, EEH, and Bighorn Asset Company, LLC, a Delaware limited liability company (“Bighorn”), as seller, entered into a purchase and sale agreement (the “Bighorn Agreement”). Pursuant to the Bighorn Agreement, EEH acquired (the “Bighorn Acquisition”) interests in oil and gas leases and related property of Bighorn located in the Midland Basin, Texas (the “Bighorn Assets”). On April 14, 2022, Earthstone, EEH and Bighorn consummated the transactions contemplated in the Bighorn Agreement whereby EEH acquired the Bighorn Assets for aggregate consideration of approximately $627.8 million in cash, net of preliminary and customary purchase price adjustments and remains subject to final post-closing settlement between EEH and Bighorn, and 5,650,977 shares Class A Common Stock. The Bighorn Acquisition was accounted for as an asset acquisition. The fair value of the consideration paid by us and allocation of that amount to the underlying assets acquired, on a relative fair value basis, was recorded on our books as of the date of the closing of the Bighorn Acquisition. Additionally, costs directly related to the Bighorn Acquisition were capitalized as a component of the purchase price. Although the purchase price allocation is substantially complete as of the date of this filing, there may be further adjustments to the Company’s estimates of the acquired oil and gas properties resulting in changes to the purchase price allocation, on a relative fair value basis. These amounts will be finalized no later than one year from the acquisition date. The consideration transferred, fair value of assets acquired and liabilities assumed by Earthstone were recorded as follows (in thousands, except share amounts and stock price): Consideration: Shares of Class A Common Stock issued 5,650,977 Class A Common Stock price as of April 14, 2022 $ 13.76 Class A Common Stock consideration 77,757 Cash consideration 625,801 Direct transaction costs (1) 2,048 Total consideration transferred $ 705,606 Fair value of assets acquired: Current assets $ 770 Oil and gas properties 746,825 Amount attributable to assets acquired $ 747,595 Fair value of liabilities assumed: Suspense payable 25,710 Other current liabilities 3,085 Noncurrent liabilities - ARO 13,194 Amount attributable to liabilities assumed $ 41,989 (1) Represents $2.0 million of estimated transaction costs associated with the Bighorn Acquisition which have been capitalized in accordance with ASC 805-50. Chisholm Acquisition On December 15, 2021, Earthstone, EEH, as buyer, Chisholm Energy Operating, LLC (“OpCo”) and Chisholm Energy Agent, Inc. (“Agent” and collectively with OpCo, “Chisholm”), collectively as seller, entered into a Purchase and Sale Agreement (the “Chisholm Agreement”), which provided that EEH would acquire (the “Chisholm Acquisition”) interests in oil and gas leases and related property of Chisholm located in Lea County and Eddy County, New Mexico (the “Chisholm Assets”). On February 15, 2022, Earthstone, EEH and Chisholm consummated the transactions contemplated in the Chisholm Agreement whereby EEH acquired the Chisholm Assets for aggregate consideration consisting of: (i) approximately $313.9 million in cash, net of customary purchase price adjustments, paid at the closing of the Chisholm Acquisition, (ii) $70 million in cash paid on April 15, 2022 and (iii) 19,417,476 shares of the Class A Common Stock. The fair value of each share of Class A Common Stock was determined using the closing sales price of $12.85 per share on February 15, 2022. A Significant Shareholder, as identified below, was the majority shareholder of Chisholm as of the closing of the Chisholm Acquisition. See Note 12. Related Party Transactions for further discussion. The Chisholm Acquisition has been accounted for as a business combination using the acquisition method of accounting, with Earthstone identified as the acquirer. The preliminary allocation of the total purchase price in the Chisholm Acquisition is based upon management’s estimates of and assumptions related to the fair value of assets acquired and liabilities assumed. Although the purchase price allocation is substantially complete as of the date of this filing, there may be further adjustments to the Company’s estimates of the acquired oil and gas properties resulting in changes to the purchase price allocation. These amounts will be finalized no later than one year from the acquisition date. The consideration transferred, fair value of assets acquired and liabilities assumed by Earthstone were recorded as follows (in thousands, except share amounts and stock price): Consideration: Shares of Class A Common Stock issued 19,417,476 Class A Common Stock price as of February 15, 2022 $ 12.85 Class A Common Stock consideration 249,515 Cash consideration 383,938 Total consideration transferred $ 633,453 Fair value of assets acquired: Oil and gas properties $ 641,494 Amount attributable to assets acquired $ 641,494 Fair value of liabilities assumed: Other current liabilities $ 2,070 Asset retirement obligation - noncurrent 5,971 Amount attributable to liabilities assumed $ 8,041 IRM Acquisition On January 7, 2021, the Company completed the acquisition (the “IRM Acquisition”) of all of the issued and outstanding limited liability company interests of Independence Resources Management, LLC (“IRM”) and certain of its wholly owned subsidiaries for consideration consisting of the following: (i) net cash of approximately $140.5 million (the “Cash Consideration”) and (ii) 12,719,594 shares of Class A Common Stock. The fair value of each share of Class A Common Stock was determined using the closing price of $6.02 per share on January 7, 2021. The IRM Acquisition has been accounted for as a business combination using the acquisition method of accounting, with Earthstone identified as the acquirer. The allocation of the total purchase price in the IRM Acquisition is based upon management’s estimates of and assumptions related to the fair value of assets acquired and liabilities assumed. The consideration transferred, fair value of assets acquired and liabilities assumed by Earthstone were recorded as follows (in thousands, except share amounts and stock price): Consideration: Shares of Class A Common Stock issued 12,719,594 Class A Common Stock price as of January 7, 2021 $ 6.02 Class A Common Stock consideration 76,572 Cash consideration 140,507 Total consideration transferred $ 217,079 Fair value of assets acquired: Cash $ 4,763 Other current assets 11,524 Oil and gas properties 224,112 Other non-current assets 252 Amount attributable to assets acquired $ 240,651 Fair value of liabilities assumed: Derivative liability $ 10,177 Other current liabilities 5,196 Asset retirement obligation - noncurrent 8,199 Amount attributable to liabilities assumed $ 23,572 Tracker/Sequel Acquisitions On March 31, 2021, Earthstone, EEH, Tracker Resource Development III, LLC, a Delaware limited liability company (“Tracker”), and TRD III Royalty Holdings (TX), LP, a Delaware limited partnership (“RoyaltyCo” and collectively with Tracker, the “Seller”), entered into a purchase and sale agreement (the “Tracker Agreement”), which provided that EEH would acquire (the “Tracker Acquisition”) interests in oil and gas leases and related property of Tracker located in Irion County, Texas (the “Tracker Assets”). Also on March 31, 2021, Earthstone, EEH, SEG-TRD LLC, a Delaware limited liability company (“SEG-I”), and SEG-TRD II LLC, a Delaware limited liability company (“SEG-II” and collectively with SEG-I, “Sequel”) entered into a purchase and sale agreement (the “Sequel Agreement” and collectively with the Tracker Agreement, the “Tracker/Sequel Purchase Agreements”), which provided that EEH would acquire (the “Sequel Acquisition” and collectively with the Tracker Acquisition, the “Tracker/Sequel Acquisitions”) certain well-bore interests and related equipment (the “Sequel Assets”). On July 20, 2021, Earthstone, EEH and the Seller consummated the transactions contemplated in the Tracker Agreement. At the closing of the Tracker Agreement, among other things, EEH acquired the Tracker Assets for aggregate consideration consisting of: (i) $18.8 million in cash, net of customary purchase price adjustments, and (ii) 4.7 million shares of Class A Common Stock. Also, on July 20, 2021, Earthstone, EEH and Sequel consummated the transactions contemplated in the Sequel Agreement. At the closing of the Sequel Agreement, among other things, EEH acquired the Sequel Assets for aggregate consideration consisting of: (i) $41.4 million in cash, net of customary purchase price adjustments, and (ii) 1.5 million shares of Class A Common Stock. A Significant Shareholder, as identified below, owned approximately 49% of Tracker as of the closing of the Tracker Acquisition. See Note 12. Related Party Transactions for further discussion. The Tracker/Sequel Acquisitions have been accounted for as asset acquisitions. The allocation of the total purchase price in the Tracker/Sequel Acquisitions is based upon management’s estimates of and assumptions related to the relative fair value of assets acquired and liabilities assumed. The consideration transferred, fair value of assets acquired and liabilities assumed by Earthstone were recorded as follows (in thousands, except share amounts and stock price): Total Consideration: Shares of Class A Common Stock issued 6,200,000 Class A Common Stock price as of July 20, 2021 $ 9.97 Class A Common Stock consideration 61,814 Cash consideration 60,159 Direct transaction costs (1) 1,715 Total consideration transferred $ 123,688 Fair value of assets acquired: Oil and gas properties $ 124,288 Amount attributable to assets acquired $ 124,288 Fair value of liabilities assumed: Noncurrent liabilities - asset retirement obligations 600 Amount attributable to liabilities assumed $ 600 (1) Represents $1.7 million of transaction costs associated with the Tracker Acquisition and the Sequel Acquisition that have been capitalized in accordance with ASC 805-50. The following unaudited supplemental pro forma condensed results of operations present consolidated information as though the Titus Acquisition, Bighorn Acquisition, Chisholm Acquisition, IRM Acquisition and Tracker/Sequel Acquisitions had been completed as of January 1, 2021. The unaudited supplemental pro forma financial information was derived from the historical statements of revenues and direct operating expenses of Titus and the historical consolidated and combined statements of operations for Bighorn, Chisholm, IRM, Tracker, Sequel and Earthstone and adjusted to include depletion expense applied to the adjusted basis of the properties acquired. These unaudited supplemental pro forma results of operations are provided for illustrative purposes only and do not purport to be indicative of the actual results that would have been achieved by the combined company for the periods presented or that may be achieved by the combined company in the future. Future results may vary significantly from the results reflected in this unaudited supplemental pro forma results of operations (in thousands, except per share amounts): Three Months Ended Nine Months Ended September 30, September 30, 2022 2021 2022 2021 Revenue $ 1,016,529 $ 450,618 $ 1,910,133 $ 963,414 Income before taxes 671,440 53,933 1,004,806 41,410 Net income 610,922 53,127 923,133 40,808 Less: Net income attributable to noncontrolling interest 179,944 23,093 282,808 17,639 Net income attributable to Earthstone Energy, Inc. 430,978 30,034 640,325 23,169 Pro forma net income per common share attributable to Earthstone Energy, Inc.: Basic $ 3.98 $ 0.29 $ 5.92 $ 0.24 Diluted $ 3.85 $ 0.28 $ 5.52 $ 0.24 The Company has included in its Condensed Consolidated Statements of Operations, revenues of $88.9 million and operating expenses of $39.7 million for the period from August 10, 2022 to September 30, 2022 related to the Titus Acquisition. The Company has included in its Condensed Consolidated Statements of Operations, revenues of $338.7 million and operating expenses of $112.0 million for the period from April 14, 2022 to September 30, 2022 related to the Bighorn Acquisition. The Company has included in its Condensed Consolidated Statements of Operations, revenues of $219.8 million and operating expenses of $86.7 million for the period from February 15, 2022 to September 30, 2022 related to the Chisholm Acquisition. During the three and nine months ended September 30, 2022, the Company recorded $0.3 million and $10.6 million, respectively, of legal and professional fees related to the Chisholm Acquisition which are included in Transaction costs in the Condensed Consolidated Statements of Operations. The Company recorded $0.7 million of legal and professional fees related to the Titus Acquisition during the three and nine months ended September 30, 2022 which are included in Transaction costs in the Condensed Consolidated Statements of Operations. Foreland-BCC Acquisition On November 2, 2021, Earthstone, EEH and Foreland Investments LP, a Delaware limited partnership (“Foreland”), consummated the transactions contemplated in the Purchase and Sale Agreement dated as of September 30, 2021 by and among Earthstone, EEH and Foreland (the “Foreland Purchase Agreement”). Net of customary purchase price adjustments, EEH acquired (the “Foreland Acquisition”) interests in oil and gas leases and related property of Foreland located in Irion County and Crockett County, Texas, for a purchase price consisting of: (i) $13.4 million in cash and (ii) 2,611,111 shares of Class A Common Stock. Also, on November 2, 2021, Earthstone, EEH and BCC-Foreland LLC, a Delaware limited liability company (“BCC”), consummated the transactions contemplated in the Purchase and Sale Agreement dated as of September 30, 2021 by and among Earthstone, EEH and BCC (the “BCC Purchase Agreement”). Net of customary purchase price adjustments, EEH acquired (the “BCC Acquisition” and with the Foreland Acquisition, the “Foreland-BCC Acquisition”) certain well-bore interests and related equipment held by BCC that were part of a joint development agreement between Foreland, Foreland Operating, LLC, and BCC involving portions of the acreage covered by the Foreland Purchase Agreement for a purchase price of $20.5 million in cash. Eagle Ford Acquisitions In May and June 2021, the Company completed acquisitions of working interests in certain assets it operates located in southern Gonzales County, Texas (collectively, the “Eagle Ford Acquisitions”) from four separate sellers. The aggregate purchase price of the Eagle Ford Acquisitions was approximately $45.2 million. One of the four separate sellers was a related party. See Note 12. Related Party Transactions for further discussion. The Eagle Ford Acquisitions have been accounted for as asset acquisitions in accordance with ASC 805. The preliminary allocation of each purchase was based upon management’s estimates of and assumptions related to the relative fair value of assets acquired and liabilities assumed. Although the purchase price allocation is substantially complete as of the date of this filing, there may be further adjustments to the acquired oil and natural gas properties. Eagle Ford Divestiture |
Oil and Natural Gas Properties
Oil and Natural Gas Properties | 9 Months Ended |
Sep. 30, 2022 | |
Oil and Gas Exploration and Production Industries Disclosures [Abstract] | |
Oil and Natural Gas Properties | Oil and Natural Gas Properties The Company follows the successful efforts method of accounting for its oil and natural gas properties. Under this method, costs to acquire oil and natural gas properties, drill and equip exploratory wells that find proved reserves, and drill and equip development wells are capitalized. Exploration costs, including unsuccessful exploratory wells and geological and geophysical costs, are charged to operations as incurred. Upon sale or retirement of oil and natural gas properties, the costs and related accumulated depreciation, depletion and amortization are eliminated from the accounts and the resulting gain or loss is recognized. Costs incurred to maintain wells and related equipment, lease and well operating costs, and other exploration costs are charged to expense as incurred. Gains and losses arising from the sale of properties are included in Income from operations in the Condensed Consolidated Statements of Operations. The Company’s lease acquisition costs and development costs of proved oil and natural gas properties are amortized using the units-of-production method, at the field level, based on total proved reserves and proved developed reserves, respectively. For the three and nine months ended September 30, 2022, depletion expense for oil and gas producing property and related equipment was $90.4 million and $190.8 million, respectively. For the three and nine months ended September 30, 2021, depletion expense for oil and gas producing property and related equipment was $26.9 million and $77.0 million, respectively. Our accrual basis capital expenditures for the three and nine months ended September 30, 2022, were as follows ( in thousands ): Three Months Ended September 30, 2022 Nine Months Ended September 30, 2022 Development costs $ 146,845 $ 348,145 Leasehold costs 307 567 Total capital expenditures $ 147,152 $ 348,712 Proved Properties Proved oil and natural gas properties are reviewed for impairment on a nonrecurring basis. The impairment charge reduces the carrying values to their estimated fair values. These fair value measurements are classified as Level 3 measurements and include many unobservable inputs. Fair value is calculated as the estimated discounted future net cash flows attributable to the assets. The Company’s primary assumptions in preparing the estimated discounted future net cash flows to be recovered from oil and gas properties are based on (i) proved reserves, (ii) forward commodity prices and assumptions as to costs and expenses, and (iii) the estimated discount rate that would be used by potential purchasers to determine the fair value of the assets. Unproved Properties Unproved properties consist of costs incurred to acquire undeveloped leases. Unproved oil and gas leases are generally for a primary term of three The Company reviews its unproved properties periodically for impairment. In determining whether an unproved property is impaired, the Company considers numerous factors including, but not limited to, current exploration and development plans, favorable or unfavorable exploration activity on the property being evaluated and/or adjacent properties, the Company’s geologists' evaluation of the property, and the remaining months in the lease term for the property. Impairments to Oil and Natural Gas Properties No impairments were recorded to the Company's oil and natural gas properties during the three and nine months ended September 30, 2022 and 2021. |
Noncontrolling Interest
Noncontrolling Interest | 9 Months Ended |
Sep. 30, 2022 | |
Noncontrolling Interest [Abstract] | |
Noncontrolling Interest | Noncontrolling InterestEarthstone consolidates the financial results of EEH and its subsidiaries and records a noncontrolling interest for the economic interest in Earthstone held by the members of EEH other than Earthstone and Lynden US. Net income (loss) attributable to noncontrolling interest in the Condensed Consolidated Statements of Operations for the three and nine months ended September 30, 2022 and 2021 represents the portion of net income (loss) attributable to the economic interest in the Company held by the members of EEH other than Earthstone and Lynden US. Noncontrolling interest in the Condensed Consolidated Balance Sheets as of September 30, 2022 and December 31, 2021 represents the portion of net assets of the Company attributable to the members of EEH other than Earthstone and Lynden US. The term “EEH Unit” means the units of limited liability company interests of EEH denominated as common units. The following table presents the changes in noncontrolling interest for the nine months ended September 30, 2022: EEH Units Held % EEH Units Held % Total EEH As of December 31, 2021 53,467,307 60.9 % 34,344,532 39.1 % 87,811,839 EEH Units issued in connection with the Chisholm Acquisition 19,417,476 — 19,417,476 EEH Units issued in connection with the Bighorn Acquisition 5,650,977 — 5,650,977 EEH Units issued in connection with the Conversion of Preferred Stock 25,225,225 — 25,225,225 EEH Units issued in connection with the Titus Acquisition 3,857,015 — 3,857,015 EEH Units and Class B Common Stock converted to Class A Common Stock 82,891 (82,891) — EEH Units issued in connection with the vesting of restricted stock units and performance-based units 716,035 — 716,035 As of September 30, 2022 108,416,926 76.0 % 34,261,641 24.0 % 142,678,567 |
Net Income (Loss) Per Common Sh
Net Income (Loss) Per Common Share | 9 Months Ended |
Sep. 30, 2022 | |
Earnings Per Share [Abstract] | |
Net Income (Loss) Per Common Share | Net Income (Loss) Per Common ShareNet income (loss) per common share—basic is calculated by dividing Net income (loss) by the weighted average number of shares of common stock outstanding during the period. Net income (loss) per common share—diluted assumes the conversion of all potentially dilutive securities and is calculated by dividing Net income (loss) by the sum of the weighted average number of shares of common stock, as defined above, outstanding plus potentially dilutive securities. Net income (loss) per common share—diluted considers the impact of potentially dilutive securities except in periods in which there is a loss because the inclusion of the potential common shares, as defined above, would have an anti-dilutive effect. A reconciliation of Net income (loss) per common share is as follows: Three Months Ended Nine Months Ended (In thousands, except per share amounts) 2022 2021 2022 2021 Net income (loss) attributable to Earthstone Energy, Inc. $ 211,456 $ 10,418 $ 322,863 $ (4,286) Net income (loss) attributable to Earthstone Energy, Inc. from assumed conversion of Series A Convertible Preferred Stock (2) 1,068 — 12,388 — Net income (loss) attributable to Earthstone Energy, Inc. - Diluted $ 212,524 $ 10,418 $ 335,251 $ (4,286) Net income (loss) per common share attributable to Earthstone Energy, Inc.: Basic $ 2.01 $ 0.21 $ 3.91 $ (0.09) Diluted $ 1.94 $ 0.20 $ 3.61 $ (0.09) Weighted average common shares outstanding Basic 105,254,778 49,243,185 82,483,635 45,406,952 Add potentially dilutive securities: Unvested restricted stock units (1) 353,889 525,475 466,453 — Unvested performance units (1) 2,024,871 2,894,282 2,133,158 — Series A Convertible Preferred Stock (2) 1,645,123 — 7,761,608 — Diluted weighted average common shares outstanding 109,278,661 52,662,942 92,844,854 45,406,952 (1) The 1,099,800 performance units granted on January 27, 2021 were excluded for all periods presented due to an assumed settlement in cash and the liability treatment described in Note 9. Stock-Based Compensation. For the nine months ended September 30, 2021, there were no dilutive effects related to unvested restricted stock units or performance units due to the loss for the period. (2) On April 14, 2022, Earthstone issued 280,000 shares of Series A Convertible Preferred Stock which automatically converted into 25,225,225 shares of Class A Common Stock on July 6, 2022. Under the “If-Converted” method, the shares would have been assumed issued on April 14, 2022, which would have resulted in an additional allocation of Net income (loss) attributable to Earthstone Energy, Inc. of $1.1 million and $12.4 million for the three and nine months ended September 30, 2022, respectively. The Class B Common Stock, par value $0.001 per share of Earthstone (the “Class B Common Stock” and with the Class A Common Stock, the “Common Stock”), has been excluded, as its conversion would eliminate noncontrolling interest and net income attributable to noncontrolling interest of $87.9 million for the three months ended September 30, 2022 and net income attributable to noncontrolling interest of $142.6 million for the nine months ended September 30, 2022 would be added back to Net income attributable to Earthstone Energy, Inc. for the periods then ended, having an antidilutive effect on Net income per common share attributable to Earthstone Energy, Inc. The Class B Common Stock has been excluded, as its conversion would eliminate noncontrolling interest and net income attributable to noncontrolling interest of $8.4 million for the three months ended September 30, 2021 and net loss attributable to noncontrolling interest of $3.3 million for the nine months ended September 30, 2021 would be added back to Net loss attributable to Earthstone Energy, Inc. for the periods then ended, having an antidilutive effect on Net loss per common share attributable to Earthstone Energy, Inc. |
Common Stock and Preferred Stoc
Common Stock and Preferred Stock | 9 Months Ended |
Sep. 30, 2022 | |
Equity [Abstract] | |
Common Stock and Preferred Stock | Common Stock and Preferred Stock Class A Common Stock At September 30, 2022 and December 31, 2021, there were 108,416,926 and 53,467,307 shares of Class A Common Stock issued and outstanding, respectively. In connection with the Chisholm Acquisition, on February 15, 2022, Earthstone issued 19,417,476 shares of Class A Common Stock valued at approximately $249.5 million on that date. In connection with the Bighorn Acquisition, on April 14, 2022, Earthstone issued 5,650,977 shares of Class A Common Stock valued at approximately $77.8 million on that date. In connection with the Titus Acquisition, on August 10, 2022, Earthstone issued 3,857,015 shares of Class A Common Stock valued at approximately $53.6 million on that date. During the three and nine months ended September 30, 2022, as a result of the vesting and settlement of performance units and restricted stock units under the Earthstone Energy, Inc. Amended and Restated 2014 Long-Term Incentive Plan, as amended (the “2014 Plan”), Earthstone issued 165,336 and 1,099,232 shares, respectively, of Class A Common Stock, of which 48,073 and 383,197 shares, respectively, of Class A Common Stock were retained as treasury stock and canceled to satisfy the related employee income tax liability. For further discussion, see Note 9. Stock-Based Compensation. During the three and nine months ended September 30, 2021, (1) in connection with the IRM Acquisition, on January 7, 2021, Earthstone issued 12,719,594 shares of Class A Common Stock valued at approximated $76.6 million on that date, (2) as a result of the vesting and settlement of performance units and restricted stock units under the 2014 Plan, Earthstone issued 220,219 and 1,162,879 shares, respectively, of Class A Common Stock, of which 65,106 and 389,213 shares, respectively, of Class A Common Stock were retained as treasury stock and canceled to satisfy the related employee income tax liability and (3) as discussed below, shares of Class A Common Stock were issued as the result of conversions of Class B Common Stock. Class B Common Stock At September 30, 2022 and December 31, 2021, there were 34,261,641 and 34,344,532 shares of Class B Common Stock issued and outstanding, respectively. Each share of Class B Common Stock, together with one EEH Unit, is convertible into one share of Class A Common Stock. There were no conversions of shares of Class B Common Stock during the three months ended September 30, 2022. During the nine months ended September 30, 2022, 82,891 shares of Class B Common Stock and EEH Units were exchanged for an equal number of shares of Class A Common Stock. During the three and nine months ended September 30, 2021, 43,882 and 655,376 shares, respectively, of Class B Common Stock and EEH Units were exchanged for an equal number of shares of Class A Common Stock. Series A Convertible Preferred Stock On January 30, 2022, Earthstone entered into a securities purchase agreement (the “SPA”) with EnCap Energy Capital Fund XI, L.P. (“EnCap Fund XI”), an affiliate of EnCap Investments L.P. (“EnCap”), and Cypress Investments, LLC, a fund managed by Post Oak Energy Capital, LP (“Post Oak” and collectively with EnCap Fund XI, the “Investors”) to sell, in a private placement (the “Private Placement”), 280,000 shares of newly authorized convertible preferred stock, $0.001 par value per share (the “Series A Convertible Preferred Stock”), each share of which would be convertible into 90.0900900900901 shares of Class A Common Stock for anticipated gross proceeds of $280.0 million, at a price of $1,000.00 per share of Series A Convertible Preferred Stock (or $11.10 per share of Class A Common Stock on an as-converted basis). The Private Placement was contingent upon the closing of the Bighorn Acquisition. The Company used the net proceeds from the sale of the Series A Convertible Preferred Stock to partially fund the Bighorn Acquisition. See Note 12. Related Party Transactions for further discussion. On April 14, 2022, Earthstone, EnCap Fund XI and Cypress consummated the sale and issuance of 280,000 shares of Series A Convertible Preferred Stock pursuant to the SPA in exchange for cash proceeds of $279.3 million, net of offering costs. On July 6, 2022, the Series A Convertible Preferred Stock automatically converted into 25,225,225 shares of Class A Common Stock. As such, the Series A Convertible Preferred Stock is no longer outstanding and the Investors were issued the 25,225,225 shares of Class A Common Stock upon the conversion of the Series A Convertible Preferred Stock. On July 15, 2022, Earthstone filed a certificate of elimination with the Secretary of State of the State of Delaware eliminating all provisions of the certificate of designations previously filed by Earthstone with the Secretary of State of the State of Delaware on April 13, 2022 related to the Series A Convertible Preferred Stock. |
Stock-Based Compensation
Stock-Based Compensation | 9 Months Ended |
Sep. 30, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
Stock-Based Compensation | Stock-Based Compensation Restricted Stock Units The 2014 Plan, allows, among other things, for the grant of restricted stock units (“RSUs”). As of September 30, 2022, the maximum number of shares of Class A Common Stock that may be issued under the 2014 Plan was 12.0 million shares. Each RSU represents the contingent right to receive one share of Class A Common Stock. The holders of outstanding RSUs do not receive dividends or have voting rights prior to vesting and settlement. The Company determines the fair value of granted RSUs based on the market price of the Class A Common Stock on the date of the grant. Compensation expense for granted RSUs is recognized on a straight-line basis over the vesting period and is net of forfeitures, as incurred. Stock-based compensation is included in General and administrative expense in the Condensed Consolidated Statements of Operations and is recorded with a corresponding increase in Additional paid-in capital within the Condensed Consolidated Balance Sheets. The table below summarizes RSU award activity for the nine months ended September 30, 2022: Shares Weighted-Average Grant Date Fair Value Unvested RSUs at December 31, 2021 771,817 $ 5.91 Granted 511,615 $ 13.75 Forfeited (14,934) $ 7.93 Vested (491,107) $ 7.77 Unvested RSUs at September 30, 2022 777,391 $ 9.86 As of September 30, 2022, there was $7.2 million of unrecognized compensation expense related to the RSU awards which will be recognized over a weighted average period of 1.28 years. For the three and nine months ended September 30, 2022, Stock-based compensation related to RSUs was $1.5 million and $4.2 million, respectively. For the three and nine months ended September 30, 2021, Stock-based compensation related to RSUs was $1.2 million and $3.9 million, respectively. Performance Units The table below summarizes PSU activity for the nine months ended September 30, 2022: Shares Weighted-Average Grant Date Fair Value Unvested PSUs at December 31, 2021 2,751,725 $ 8.42 Granted 472,485 $ 19.42 Vested (608,125) $ 9.30 Unvested PSUs at September 30, 2022 2,616,085 $ 10.20 On January 30, 2020, the Board of Directors of Earthstone (the “Board”) granted 1,043,800 PSUs (the “2020 PSUs”) to certain officers pursuant to the 2014 Plan. The 2020 PSUs are expected to be paid in shares of Class A Common Stock upon the achievement by Earthstone over a period commencing on February 1, 2020 and ending on January 31, 2023 (the “2020 Performance Period”) of certain performance criteria established by the Board. On February 1, 2022, the Board granted 472,485 PSUs (the “2022 PSUs”) to certain officers pursuant to the 2014 Plan. The 2022 PSUs are expected to be paid in shares of Class A Common Stock upon the achievement by Earthstone over a period commencing on January 1, 2022 and ending on December 31, 2024 (the “2022 Performance Period”) of certain performance criteria established by the Board. The Company classifies 2020 PSUs and 2022 PSUs as equity awards as they are expected to be settled in shares. In the event that a PSU grant is expected to be settled in cash, it is alternatively classified as a liability award. The 2020 PSUs and 2022 PSUs are eligible to be earned based on the annualized Total Shareholder Return (“TSR”) of the Class A Common Stock during 2020 Performance Period and 2022 Performance Period, respectively. Between 0x to 2.0x of the Performance Units are eligible to be earned based on Earthstone achieving an annualized TSR based on the following pre-established goals: Earthstone’s Annualized TSR TSR Multiplier 23.9% or greater 2 14.5% 1 8.4% 0.5 Less than 8.4% 0 The Company accounts for 2020 PSUs and 2022 PSUs as market-based awards which were valued utilizing the Monte Carlo Simulation pricing model, which calculated multiple potential outcomes for an award and established grant date fair value based on the most likely outcome. For the 2020 PSUs, assuming a risk-free rate of 1.4% and volatility of 62.0%, the Company calculated the weighted average grant date fair value per PSU to be $5.36. For the 2022 PSUs, assuming a risk-free rate of 1.4% and volatility of 86.0%, the Company calculated the weighted average grant date fair value per PSU to be $19.42. On January 27, 2021, the Board granted 1,099,800 PSUs to certain officers pursuant to the 2014 Plan (the “2021 PSUs”). The 2021 PSUs are payable in cash or shares of Class A Common Stock upon the achievement by the Company over a period commencing on January 1, 2021 and ending on December 31, 2023 of certain performance criteria established by the Board. The Company classifies these awards as liability awards as they are expected to be paid in cash. As of September 30, 2022 and December 31, 2021, $13.5 million and $6.3 million, respectively, have been included in Other noncurrent liabilities in the Condensed Consolidated Balance Sheets related to the 2021 PSUs. On January 28, 2019, the Board granted 669,550 PSUs to certain named executive officers pursuant to the 2014 Plan (the “2019 PSUs”). The 2019 PSUs were payable in shares of Class A Common Stock based upon the achievement by Earthstone over a period commencing on February 1, 2019 and ending on January 31, 2022 of performance criteria established by the Board. On January 31, 2022, the Company settled the remaining 608,125 PSUs, net of forfeitures, at a rate of 1.97x. 1.0x was settled through the issuance of 608,125 shares of Class A Common Stock and the remainder was settled in cash. As of September 30, 2022, there was $17.7 million of unrecognized compensation expense related to all PSU awards which will be amortized over a weighted average period of 1.10 years. |
Long-Term Debt
Long-Term Debt | 9 Months Ended |
Sep. 30, 2022 | |
Debt Disclosure [Abstract] | |
Long-term debt | Long-Term Debt The Company's long-term debt consisted of the following ( in thousands ): September 30, 2022 December 31, 2021 Revolving credit facility (1) $ 391,732 $ 320,000 Term loan under credit facility due 2027 250,000 — 8.000% Senior notes due 2027 550,000 — 1,191,732 320,000 Unamortized debt issuance costs on term loan (5,591) — Unamortized debt issuance costs on 8.000% Senior notes (11,592) — Long-term debt, net $ 1,174,549 $ 320,000 (1) Related to the revolving credit facility borrowings, the Company had debt issuance costs of $16.2 million and $6.7 million, net of accumulated amortization of $5.7 million and $3.3 million, as of September 30, 2022 and December 31, 2021, respectively. Unamortized deferred financing costs on the revolving credit facility borrowings are included in Other noncurrent assets in the Condensed Consolidated Balance Sheets. Credit Agreement On November 21, 2019, Earthstone, EEH (the “Borrower”), Wells Fargo Bank, National Association, as Administrative Agent and Issuing Bank (“Wells Fargo”), Royal Bank of Canada, as Syndication Agent, BOKF, NA dba Bank of Texas (“BOKF”) as Issuing Bank with respect to Existing Letters of Credit, SunTrust Bank, as Documentation Agent, and the lenders party thereto (the “Lenders”) entered into a credit agreement (together with all amendments or other modifications, the “Credit Agreement”), which replaced the prior credit facility, which was terminated on November 21, 2019. On January 30, 2022, Earthstone, EEH, as Borrower, Wells Fargo as Administrative Agent, the lenders party thereto (the “Lenders”) and the guarantors party thereto entered into an amended and restated Fifth Amendment (the “Fifth Amendment”) to the Credit Agreement. Among other things, the Fifth Amendment increased the borrowing base and corresponding elected commitments from $650 million to $825 million upon the closing of the Chisholm Agreement. On April 12, 2022, EEH issued $550.0 million aggregate principal amount of unsecured 8.000% senior notes due 2027 (the “Notes”). EEH received net proceeds from the offering (the “Notes Offering”) which reduced the elected commitments by $500 million. On April 14, 2022, in connection with the Notes Offering, the Company voluntarily elected to reduce commitments under the borrowing base of the Credit Agreement to $800 million. On June 2, 2022, the Company, EEH, Wells Fargo, the Lenders and the guarantors party thereto entered into an amendment (the “Sixth Amendment”) to the Credit Agreement. Among other things, the Sixth Amendment extended the maturity of the Credit Agreement to June 2027, increased the borrowing base from $1.325 billion to $1.4 billion and reduced the interest rate for amounts outstanding. Elected commitments under the Credit Agreement remained at $800 million. On August 10, 2022, Earthstone, EEH, Wells Fargo as Administrative Agent, the Lenders and the guarantors party thereto entered into an amendment (the “Seventh Amendment”) to the Credit Agreement. Among other things, the Seventh Amendment increased the borrowing base from $1.4 billion to $1.7 billion and increased elected commitments from $800 million to $1.2 billion. The Seventh Amendment also established a fully funded $250 million term loan tranche as a portion of the $1.2 billion of available commitments under the Credit Agreement (the “Term Loan”), with the remaining $950 million of commitments in the form of revolving commitments. The Term Loan is fully pre-payable without premium or penalty, subject to the satisfaction of certain specified conditions, and bears an interest rate of Term SOFR (as defined in the Credit Agreement) plus 3.25%, increasing by 0.25% each 180-day period following the Term Loan funding. The Term Loan is co-terminus with the revolving loans' maturity date of June 2, 2027, subject to the Springing Maturity Date (as defined in the Credit Agreement) applicable to revolving loans and term loans. The interest rate applicable to revolving loans remains a rate of Term SOFR plus an applicable margin between 2.25% and 3.25%, depending upon borrowing base utilization. On September 29, 2022, in connection with a regularly scheduled borrowing base redetermination, the borrowing base increased from $1.7 billion to $1.85 billion. The next regularly scheduled redetermination of the borrowing base is expected to occur on or around May 1, 2023. Subsequent redeterminations are expected to occur on or about each November 1st and May 1st thereafter. The amounts borrowed under the Credit Agreement bear annual interest rates at either (a) the adjusted SOFR Rate (the “Adjusted Term SOFR Rate”) plus 2.25% to 3.25% or (b) the sum of (i) the greatest of (A) the prime rate of Wells Fargo, (B) the federal funds rate plus ½ of 1.0%, and (C) the Adjusted Term SOFR Rate for an interest rate period of one month plus 1.0%, (ii) plus 1.25% to 2.25%, depending on the amount borrowed under the Credit Agreement. Principal amounts outstanding under the Credit Agreement are due and payable in full at maturity on June 2, 2027. All of the obligations under the Credit Agreement, and the guarantees of those obligations, are secured by substantially all of EEH’s assets. Additional payments due under the Credit Agreement include paying a commitment fee of 0.375% to 0.50% per year, depending on the amount borrowed under the Credit Agreement, to the Lenders in respect of the unutilized commitments thereunder. EEH is also required to pay customary letter of credit fees. The Credit Agreement contains a number of covenants that, among other things, restrict, subject to certain exceptions, EEH’s ability to incur additional indebtedness, create liens on assets, make investments, pay dividends and distributions or repurchase its limited liability interests, engage in mergers or consolidations, sell certain assets, sell or discount any notes receivable or accounts receivable and engage in certain transactions with affiliates. In addition, the Credit Agreement requires EEH to maintain the following financial covenants: a current ratio, (as such term is defined in the Credit Agreement) of not less than 1.0 to 1.0 and a consolidated leverage ratio of not greater than 3.5 to 1.0. Consolidated leverage ratio means the ratio of (i) the aggregate debt of EEH and its consolidated subsidiaries as at the last day of the fiscal quarter to (ii) EBITDAX for the applicable period, which, for the period ended September 30, 2022, was calculated by multiplying EBITDAX for the two consecutive fiscal quarters ending on such date by two. The term “EBITDAX” means, for any period, the sum of consolidated net income (loss) for such period plus (a) the following expenses or charges to the extent deducted from consolidated net income (loss) in such period: (i) interest, (ii) taxes, (iii) depreciation, (iv) depletion, (v) amortization, (vi) certain distributions to employees related to the stock compensation, (vii) certain transaction related expenses, (viii) reimbursed indemnification expenses related to certain dispositions and investments, (ix) non-cash extraordinary, usual, or nonrecurring expenses or losses, (x) other non-cash charges and minus (b) to the extent included in consolidated net income (loss) in such period: (i) non-cash income, (ii) gains on asset dispositions, disposals and abandonments outside of the ordinary course of business and (iii) to the extent not otherwise deducted from consolidated net income (loss), the aggregate amount of any pass-through cash distributions received by Borrower during such period in an amount equal to the aggregate amount of pass-through cash distributions actually made by Borrower during such period. The Credit Agreement contains customary affirmative covenants and defines events of default to include failure to pay principal or interest, breach of covenants, breach of representations and warranties, insolvency, judgment default and a change in control. Upon the occurrence and continuance of an event of default, the Lenders have the right to accelerate repayment of the loans and exercise their remedies with respect to the collateral. As of September 30, 2022, EEH was in compliance with the covenants under the Credit Agreement. As of September 30, 2022, $391.7 million and $250.0 million of borrowings were outstanding under the revolving tranche and the term loan tranche of the Credit Agreement, respectively, bearing annual interest of 5.824% and 6.100%, respectively, resulting in an additional $558.3 million of borrowing base availability under the Credit Agreement. At December 31, 2021, there were $320.0 million of borrowings outstanding under the Credit Agreement. For the three and nine months ended September 30, 2022, interest on borrowings under the revolving tranche of the Credit Agreement averaged 4.75% and 4.29% per annum, respectively, which excluded commitment fees of $1.0 million and $1.1 million, respectively, and amortization of deferred financing costs of $0.8 million and $2.4 million, respectively. For the three and nine months ended September 30, 2022, interest on borrowings under the term loan tranche of the Credit Agreement averaged 6.01% and 6.01% per annum, respectively, which excluded amortization of deferred financing costs of $0.2 million and $0.2 million, respectively. For the three and nine months ended September 30, 2021, interest on borrowings under the Credit Agreement averaged 3.66% and 3.47% per annum, respectively, which excluded commitment fees of $0.2 million and $0.6 million, respectively, and amortization of deferred financing costs of $0.2 million and $0.6 million, respectively. During the three and nine months ended September 30, 2022, the Company capitalized $3.6 million and $15.2 million, respectively, of costs associated with the revolving tranche of the Credit Agreement and $5.8 million and $5.8 million, respectively, associated with the term loan tranche of the Credit Agreement. During the three and nine months ended September 30, 2021, the Company capitalized $1.0 million and $2.8 million, respectively, of costs associated with the Credit Agreement. The Company’s policy is to capitalize the financing costs associated with the Credit Agreement and amortize those costs on a straight-line basis over the term of the associated debt. 8.000% Senior Notes EEH received net proceeds from the Notes Offering of approximately $537.2 million (after deducting underwriting discounts and commissions) which was used primarily to fund the Bighorn Acquisition and the remainder for general corporate purposes. On April 12, 2022, in connection with the completion of the Notes Offering, EEH entered into an indenture, dated as of April 12, 2022 (the “Indenture”), among EEH, the guarantors party thereto and U.S. Bank Trust Company, National Association, as trustee. The Notes will mature on April 15, 2027 with interest accruing at a rate of 8.000% per annum payable semi-annually in cash in arrears on April 15 and October 15 of each year, commencing October 15, 2022. Before April 15, 2024, EEH may redeem some or all of the Notes at a redemption price equal to 100% of the aggregate principal amount of the Notes redeemed plus the “applicable premium” as of and accrued and unpaid interest, if any, to, but excluding, the date of redemption. EEH may redeem, at its option, all or part of the Notes at any time on or after April 15, 2024, at the applicable redemption price plus accrued and unpaid interest to, but not including, the date of redemption. Further, before April 15, 2024, EEH may on one or more occasions redeem up to 35% of the aggregate principal amount of the Notes in an amount not exceeding the net proceeds from one or more private or public equity offerings at a redemption price of 108.000% of the principal amount of the Notes, plus accrued and unpaid interest to the date of redemption, if at least 65% of the aggregate principal amount of the Notes remains outstanding immediately after such redemption and the redemption occurs within 180 days of the closing date of each such equity offering. Upon a Change of Control (as defined in the Indenture) EEH must offer to repurchase the Notes on terms and conditions set forth in detail in the Indenture. The Notes are guaranteed on a senior unsecured basis by the Company and its subsidiaries (the “Guarantors”) and may be guaranteed by certain of EEH’s future restricted subsidiaries. The Notes are unsecured, rank equally in right of payment with all existing and future senior unsecured indebtedness of EEH and the Guarantors and rank senior in right of payment to any future subordinated indebtedness of EEH and the Guarantors. The Notes will rank effectively junior to all secured indebtedness of EEH and the Guarantors, including indebtedness under EEH’s revolving credit facility, to the extent of the value of the assets securing such indebtedness. The Notes will rank structurally junior in right of payment to all indebtedness and other liabilities, including trade payables, of any future subsidiary of EEH that are not guarantors. The Indenture restricts EEH’s ability and the ability of its Restricted Subsidiaries (as defined in the Indenture), including the Guarantors, to: (i) incur or guarantee additional indebtedness or issue certain types of preferred stock; (ii) pay dividends on capital stock or redeem, repurchase or retire its capital stock or subordinated indebtedness; (iii) transfer or sell assets; (iv) make investments; (v) create certain liens; (vi) enter into agreements that restrict dividends or other payments from its Restricted Subsidiaries to EEH; (vii) consolidate, merge or transfer all or substantially all of its assets; (viii) engage in transactions with affiliates; and (ix) create unrestricted subsidiaries. These covenants are subject to important exceptions and qualifications set forth in the Indenture. If the Notes achieve an Investment Grade Rating (as defined in the Indenture) or better from two of three of Moody’s Investors Service, Inc., S&P Global Ratings, or Fitch Ratings, Inc., many of these covenants will be suspended. The Indenture contains customary events of default (each an “Event of Default”). If an Event of Default occurs and is continuing, the Trustee or the holders of not less than 25% in aggregate principal amount of the outstanding Notes may declare the unpaid principal of, premium, if any, and accrued but unpaid interest on, all the Notes then outstanding to be due and payable. Upon such a declaration, such principal, premium, if any, and interest will be due and payable immediately. If an Event of Default relating to certain events of bankruptcy or insolvency of EEH or any Significant Subsidiary (as defined in the Indenture) occurs, the principal of, premium, if any, and the interest on, all the Notes will become immediately due and payable without any declaration or other act on the part of the Trustee or any holders of the Notes. Under certain circumstances, the holders of a majority in principal amount of the outstanding Notes may rescind any such acceleration with respect to the Notes and its consequences. During the three and nine months ended September 30, 2022, the Company capitalized $12.7 million of costs associated with the Notes. No costs associated with the Notes were capitalized during the three and nine months ended September 30, 2021. The Company’s policy is to capitalize the debt issuance costs associated with the Notes and amortize those costs on a straight-line basis over the term of the Notes. As of September 30, 2022, accrued interest of $20.7 million associated with the Notes was included in Accrued expenses in the Condensed Consolidated Balance Sheets. |
Asset Retirement Obligations
Asset Retirement Obligations | 9 Months Ended |
Sep. 30, 2022 | |
Asset Retirement Obligation Disclosure [Abstract] | |
Asset Retirement Obligations | Asset Retirement Obligations The Company has asset retirement obligations associated with the future plugging and abandonment of oil and gas properties and related facilities. Revisions to the liability typically occur due to changes in the estimated abandonment costs, well economic lives, and the discount rate. The following table summarizes the Company’s asset retirement obligation transactions recorded during the nine months ended September 30, 2022 (in thousands) : 2022 Beginning asset retirement obligations $ 15,866 Liabilities incurred 342 Liabilities settled (665) Acquisitions 20,078 Accretion expense 1,863 Divestitures (1,087) Revision of estimates 381 Ending asset retirement obligations $ 36,778 |
Related Party Transactions
Related Party Transactions | 9 Months Ended |
Sep. 30, 2022 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Related Party Transactions FASB ASC Topic 850, Related Party Disclosures, requires that information about transactions with related parties that would make a difference in decision making shall be disclosed so that users of the financial statements can evaluate their significance. The Audit Committee of the Board independently reviews and approves all related party transactions. Earthstone has two significant shareholders that consist of various investment funds managed by each of the two private equity firms who may manage other investments in entities with which the Company interacts in the normal course of business (the “Significant Shareholders” or separately, each a “Significant Shareholder”). As discussed in Note 4. Acquisitions, the Chisholm Acquisition was consummated on February 15, 2022, whereby the Company acquired the Chisholm Assets for a purchase price of $377.5 million in cash, net of customary purchase price adjustments, and approximately 19.4 million shares of Class A Common Stock. A Significant Shareholder was the majority owner of Chisholm as of the closing of the Chisholm Acquisition. The deferred payment of $70 million as of March 31, 2022 was paid on April 15, 2022 and included in Deferred acquisition payment – Chisholm in the Condensed Consolidated Balance Sheet as of March 31, 2022. The issuance of approximately 19.4 million shares of Class A Common Stock in connection with the closing of the Chisholm Agreement was (1) approved by a majority of the voting power of all outstanding disinterested shares of the Common Stock and (2) increased the Significant Stockholder's beneficial ownership of Class A Common Stock from approximately 25% to 36% as of February 15, 2022. As discussed in Note 4. Acquisitions, on March 31, 2021, Earthstone and EEH entered into the Tracker/Sequel Purchase Agreements. The Tracker/Sequel Acquisitions were consummated on July 20, 2021, whereby the Company acquired the Tracker Assets for a purchase price of $18.8 million in cash and 4.7 million shares of Class A Common Stock. A Significant Shareholder owned approximately 49% of Tracker as of the closing of the Tracker Acquisition. A majority of the non-affiliated stockholders of Earthstone approved the issuance of 6.2 million shares of Class A Common Stock in connection with the closing of the Tracker/Sequel Purchase Agreements at Earthstone’s Annual Meeting of Stockholders held on July 20, 2021. As discussed in Note 4. Acquisitions , during the second quarter of 2021, the Company completed the Eagle Ford Acquisitions for a purchase price of approximately $45.2 million in cash. A Significant Shareholder controlled one of the four sellers. After participating in a competitive sales process, the Company acquired the aforementioned assets for $8.2 million in cash from that related party entity. As described in Note 8. Common Stock and Preferred Stock, on January 30, 2022, Earthstone entered into the SPA with certain affiliates of EnCap and Post Oak (collectively, the “Investors”) to issue 220,000 shares and 60,000 shares, respectively, of the Series A Convertible Preferred Stock. On April 14, 2022, the SPA was consummated resulting in the issuance of the total of 280,000 shares of the Series A Convertible Preferred Stock in exchange for cash proceeds of $279.3 million, net of offering costs. On July 6, 2022, the Series A Convertible Preferred Stock automatically converted into 25,225,225 shares of Class A Common Stock. The Company paid $0.2 million to one of our Significant Shareholders for reimbursement of certain costs associated with the aforementioned SPA. On October 11, 2022, Earthstone repurchased an aggregate of 3,000,000 shares of Class A Common Stock, held by affiliates of Warburg Pincus LLC (“Warburg”) in a private transaction, for an aggregate purchase price of approximately $43.7 million, or $14.58 per share (the “Repurchase”). Additionally, on October 11, 2022, Warburg sold 3,750,000 shares of Class A Common Stock to an unrelated party for $14.58 per share (collectively with the Repurchase, the “Warburg Sales”). Immediately preceding the Warburg Sales, Warburg owned approximately 18.7% of our outstanding Class A Common Stock and 14.1% of our Class A Common Stock and Class B Common Stock combined. Immediately following the Warburg Sales and through the date of this filing, Warburg owned approximately 12.3% of our Class A Common Stock and 9.3% of our Class A Common Stock and Class B Common Stock combined. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Legal George Assad, et. al. v. EnCap Investments L.P., et. al.: On September 12, 2022, a complaint (the “Complaint”) styled as a “derivative action” was filed in the Delaware Court of Chancery (the “Court”) by George Assad (the “plaintiff”) a purported holder of a small number of shares of Class A Common Stock against Earthstone, six of its 10 directors and EnCap, a principal stockholder. The Complaint alleges that a majority of Earthstone’s directors were conflicted and, along with EnCap, breached their fiduciary duties in approving the sale of shares of Series A Convertible Preferred Stock that is convertible into Class A Common Stock pursuant to the SPA. The plaintiff requested the Court to declare that the defendants breached their fiduciary duties, award of unspecified monetary damages, including interest and costs, and/ or rescind the stock purchase transaction. On October 14, 2022, the defendants filed a motion to dismiss the amended Complaint. Earthstone believes the Complaint is completely without merit and intends to contest vigorously the allegations made therein and to seek reimbursement for its costs and expenses in so doing. Earthstone carries insurance for the claims asserted against it and the officer and director defendants in the Complaint, and the carrier has accepted coverage subject to applicable self-retentions and limits of liability. The Company does not expect this case to have a material adverse effect on the results of operations, financial position or cash flows of the Company. From time to time, the Company may be involved in other various legal proceedings and claims in the ordinary course of business. Commitment to Purchase Materials The Company entered into an agreement to purchase certain materials related to its drilling and completion activities through 2024 (the “Materials Purchase Agreement”). The Company has already fulfilled its 2022 financial obligation under the Materials Purchase Agreement and the Company has committed to payments of $29.8 million in 2023 and $6.9 million in 2024. Environmental and Regulatory |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2022 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The Company’s corporate structure requires the filing of two separate U.S. Federal income tax returns and one Canadian income tax return which include Lynden US, Earthstone, and Lynden Corp, respectively. As such, taxable income of Earthstone cannot be offset by tax attributes, including net operating losses, of Lynden US, nor can taxable income of Lynden US be offset by tax attributes of Earthstone. Earthstone and Lynden US record a tax provision, respectively, for their share of the book income or loss of EEH, net of the non-controlling interest. As EEH is treated as a partnership for U.S. Federal income tax purposes, it is not subject to income tax at the federal level and only recognizes the Texas Margin Tax. On February 15, 2022, the Company completed the Chisholm Acquisition which included the issuance of 19,417,476 shares of Class A Common Stock, which resulted in an ownership change within the meaning of Section 382 of the Internal Revenue Code of 1986, as amended (the “Code”). As a result of the ownership change, the Company’s ability to utilize net operating losses (“NOLs”) and credits generated prior to the ownership change date may be limited to offset taxable income incurred after the ownership change date (the “382 Limitation”). As of September 30, 2022 and December 31, 2021, current liabilities of $4.1 million and $0.9 million, respectively, are included in Other current liabilities in the Condensed Consolidated Balance Sheets. As of September 30, 2022, amount includes $2.0 million current federal income tax payable and $2.1 million current Texas Margin Tax payable. As of December 31, 2021, the amounts solely represent current Texas Margin Tax payable. During the nine months ended September 30, 2022, the Company recorded income tax expense of approximately $81.7 million comprised of (1) income tax expense for Earthstone of $70.0 million, which included a deferred income tax expense of $74.5 million and a current income tax expense of $2.0 million, resulting from its share of the distributable income from EEH, offset by a $6.5 million release of valuation allowance, (2) a deferred income tax expense for Lynden US of $5.5 million as a result of its share of the distributable loss from EEH and (3) income tax expense of $6.2 million related to state taxes, which included a deferred income tax expense of $4.1 million and a current income tax expense of $2.1 million. Lynden Corp incurred no material income or loss, or related income tax expense or benefit, for the nine months ended September 30, 2022. During the nine months ended September 30, 2021, the Company recorded income tax benefit of approximately $0.3 million comprised of (1) a deferred income tax benefit for Lynden US of $0.1 million as a result of its share of the distributable loss from EEH, (2) no net income tax benefit for Earthstone as the $0.8 million income tax benefit resulting from its share of the distributable loss from EEH had a full valuation allowance recorded against it as future realization of the net deferred tax asset cannot be assured and (3) deferred income tax benefit of $0.8 million related to the Texas Margin Tax, offset by (4) current income tax expense of $0.6 million related to the Texas Margin Tax. Lynden Corp incurred no material income or loss, or related income tax expense or benefit, for the nine months ended September 30, 2021. |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Fair Value Disclosures [Abstract] | |
Summary of Fair Value of Financial Assets and Liabilities | The following table summarizes the fair value of the Company’s financial assets and liabilities, by level within the fair-value hierarchy (in thousands) : September 30, 2022 Level 1 Level 2 Level 3 Total Financial assets Derivative asset - current $ — $ 14,950 $ — $ 14,950 Derivative asset - noncurrent — 5,526 — 5,526 Total financial assets $ — $ 20,476 $ — $ 20,476 Financial liabilities Derivative liability - current $ — $ 28,404 $ — $ 28,404 Derivative liability - noncurrent — 7,840 — 7,840 Share-based compensation liability - noncurrent — 13,474 — 13,474 Total financial liabilities $ — $ 49,718 $ — $ 49,718 December 31, 2021 Financial assets Derivative asset - current $ — $ 1,348 $ — $ 1,348 Derivative asset - noncurrent — 157 — 157 Total financial assets $ — $ 1,505 $ — $ 1,505 Financial liabilities Derivative liability - current $ — $ 45,310 $ — $ 45,310 Derivative liability - noncurrent — 571 — 571 Share-based compensation liability - current — 7,835 — 7,835 Share-based compensation liability - noncurrent — 6,324 — 6,324 Total financial liabilities $ — $ 60,040 $ — $ 60,040 |
Derivative Financial Instrume_2
Derivative Financial Instruments (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Open Crude Oil and Natural Gas Derivative Contracts | The Company had the following open crude oil and natural gas derivative contracts as of September 30, 2022: Price Swaps Period Commodity Volume Weighted Average Price Q4 2022 Crude Oil 1,081,000 $ 66.70 Q1 - Q4 2023 Crude Oil 1,277,500 $ 76.20 Q4 2022 Crude Oil Basis Swap (1) 3,128,000 $ 0.89 Q1 - Q4 2023 Crude Oil Basis Swap (1) 9,488,500 $ 0.92 Q4 2022 Natural Gas 1,893,500 $ 3.33 Q1 - Q4 2023 Natural Gas 3,670,000 $ 3.35 Q4 2022 Natural Gas Basis Swap (2) 1,840,000 $ (0.33) Q1 - Q4 2023 Natural Gas Basis Swap (2) 36,500,000 $ (1.47) Q1 - Q4 2024 Natural Gas Basis Swap (2) 36,600,000 $ (1.05) (1) The basis differential price is between WTI Midland Crude and the WTI NYMEX. (2) The basis differential price is between W. Texas (WAHA) and the Henry Hub NYMEX. Costless Collars Period Commodity Volume Bought Floor Sold Ceiling Q4 2022 Crude Oil Costless Collar 805,000 $ 73.14 $ 96.49 Q1 - Q4 2023 Crude Oil Costless Collar 1,715,500 $ 62.98 $ 80.34 Q4 2022 Natural Gas Costless Collar 8,686,500 $ 4.57 $ 10.17 Q1 - Q4 2023 Natural Gas Costless Collar 17,298,000 $ 3.77 $ 7.49 Deferred Premium Puts Period Commodity Volume $/Bbl (Put Price) $/Bbl (Net of Premium) Q4 2022 Crude Oil 253,000 $ 80.00 $ 75.79 Q1 - Q4 2023 Crude Oil 1,750,500 $ 70.00 $ 64.53 |
Schedule of Location and Fair Value Amounts of All Derivative Instruments | The following table summarizes the location and fair value amounts of all derivative instruments in the Condensed Consolidated Balance Sheets as well as the gross recognized derivative assets, liabilities, and amounts offset in the Condensed Consolidated Balance Sheets (in thousands) : September 30, 2022 December 31, 2021 Derivatives not Balance Sheet Location Gross Gross Net Gross Gross Net Commodity contracts Derivative asset - current $ 53,601 $ (38,651) $ 14,950 $ 3,191 $ (1,843) $ 1,348 Commodity contracts Derivative liability - current $ 67,055 $ (38,651) $ 28,404 $ 47,153 $ (1,843) $ 45,310 Commodity contracts Derivative asset - noncurrent $ 12,941 $ (7,415) $ 5,526 $ 2,721 $ (2,564) $ 157 Commodity contracts Derivative liability - noncurrent $ 15,255 $ (7,415) $ 7,840 $ 3,135 $ (2,564) $ 571 |
Schedule of Realized and Unrealized Gains and Losses on Derivative Instruments | The following table summarizes the location and amounts of the Company’s realized and unrealized gains and losses on derivatives instruments in the Condensed Consolidated Statements of Operations and Condensed Consolidated Statements of Cash Flows (in thousands) : Derivatives not designated as hedging contracts under ASC Topic 815 Three Months Ended Nine Months Ended Statement of Cash Flows Location Statement of Operations Location 2022 2021 2022 2021 Unrealized gain (loss) Not separately presented Not separately presented $ 119,209 $ (12,244) $ 28,607 $ (71,255) Realized loss Operating portion of net cash paid in settlement of derivative contracts Not separately presented (58,923) (20,884) (169,708) (46,311) Total (gain) loss on derivative contracts, net Gain (loss) on derivative contracts, net $ 60,286 $ (33,128) $ (141,101) $ (117,566) |
Acquisitions and Divestitures (
Acquisitions and Divestitures (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Business Combination, Asset Acquisition and Divestitures [Abstract] | |
Schedule of Business Acquisitions, by Acquisition | The consideration transferred, fair value of assets acquired and liabilities assumed by Earthstone were recorded as follows (in thousands, except share amounts and stock price): Consideration: Shares of Class A Common Stock issued 3,857,015 Class A Common Stock price as of August 10, 2022 $ 13.89 Class A Common Stock consideration 53,574 Cash consideration 565,777 Total consideration transferred $ 619,351 Fair value of assets acquired: Oil and gas properties $ 623,119 Amount attributable to assets acquired $ 623,119 Fair value of liabilities assumed: Current liabilities $ 2,854 Noncurrent liabilities - ARO 914 Amount attributable to liabilities assumed $ 3,768 Consideration: Shares of Class A Common Stock issued 5,650,977 Class A Common Stock price as of April 14, 2022 $ 13.76 Class A Common Stock consideration 77,757 Cash consideration 625,801 Direct transaction costs (1) 2,048 Total consideration transferred $ 705,606 Fair value of assets acquired: Current assets $ 770 Oil and gas properties 746,825 Amount attributable to assets acquired $ 747,595 Fair value of liabilities assumed: Suspense payable 25,710 Other current liabilities 3,085 Noncurrent liabilities - ARO 13,194 Amount attributable to liabilities assumed $ 41,989 (1) Represents $2.0 million of estimated transaction costs associated with the Bighorn Acquisition which have been capitalized in accordance with ASC 805-50. Consideration: Shares of Class A Common Stock issued 19,417,476 Class A Common Stock price as of February 15, 2022 $ 12.85 Class A Common Stock consideration 249,515 Cash consideration 383,938 Total consideration transferred $ 633,453 Fair value of assets acquired: Oil and gas properties $ 641,494 Amount attributable to assets acquired $ 641,494 Fair value of liabilities assumed: Other current liabilities $ 2,070 Asset retirement obligation - noncurrent 5,971 Amount attributable to liabilities assumed $ 8,041 Consideration: Shares of Class A Common Stock issued 12,719,594 Class A Common Stock price as of January 7, 2021 $ 6.02 Class A Common Stock consideration 76,572 Cash consideration 140,507 Total consideration transferred $ 217,079 Fair value of assets acquired: Cash $ 4,763 Other current assets 11,524 Oil and gas properties 224,112 Other non-current assets 252 Amount attributable to assets acquired $ 240,651 Fair value of liabilities assumed: Derivative liability $ 10,177 Other current liabilities 5,196 Asset retirement obligation - noncurrent 8,199 Amount attributable to liabilities assumed $ 23,572 |
Schedule of Asset Acquisition | The consideration transferred, fair value of assets acquired and liabilities assumed by Earthstone were recorded as follows (in thousands, except share amounts and stock price): Total Consideration: Shares of Class A Common Stock issued 6,200,000 Class A Common Stock price as of July 20, 2021 $ 9.97 Class A Common Stock consideration 61,814 Cash consideration 60,159 Direct transaction costs (1) 1,715 Total consideration transferred $ 123,688 Fair value of assets acquired: Oil and gas properties $ 124,288 Amount attributable to assets acquired $ 124,288 Fair value of liabilities assumed: Noncurrent liabilities - asset retirement obligations 600 Amount attributable to liabilities assumed $ 600 (1) Represents $1.7 million of transaction costs associated with the Tracker Acquisition and the Sequel Acquisition that have been capitalized in accordance with ASC 805-50. |
Schedule of Business Acquisition, Pro Forma Information | These unaudited supplemental pro forma results of operations are provided for illustrative purposes only and do not purport to be indicative of the actual results that would have been achieved by the combined company for the periods presented or that may be achieved by the combined company in the future. Future results may vary significantly from the results reflected in this unaudited supplemental pro forma results of operations (in thousands, except per share amounts): Three Months Ended Nine Months Ended September 30, September 30, 2022 2021 2022 2021 Revenue $ 1,016,529 $ 450,618 $ 1,910,133 $ 963,414 Income before taxes 671,440 53,933 1,004,806 41,410 Net income 610,922 53,127 923,133 40,808 Less: Net income attributable to noncontrolling interest 179,944 23,093 282,808 17,639 Net income attributable to Earthstone Energy, Inc. 430,978 30,034 640,325 23,169 Pro forma net income per common share attributable to Earthstone Energy, Inc.: Basic $ 3.98 $ 0.29 $ 5.92 $ 0.24 Diluted $ 3.85 $ 0.28 $ 5.52 $ 0.24 |
Oil and Natural Gas Properties
Oil and Natural Gas Properties Oil and Natural Gas Properties (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Oil and Gas Exploration and Production Industries Disclosures [Abstract] | |
Schedule of Capital Expenditures Of Oil and Gas | Our accrual basis capital expenditures for the three and nine months ended September 30, 2022, were as follows ( in thousands ): Three Months Ended September 30, 2022 Nine Months Ended September 30, 2022 Development costs $ 146,845 $ 348,145 Leasehold costs 307 567 Total capital expenditures $ 147,152 $ 348,712 |
Noncontrolling Interest (Tables
Noncontrolling Interest (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Noncontrolling Interest [Abstract] | |
Schedule of Changes in Noncontrolling Interest | The following table presents the changes in noncontrolling interest for the nine months ended September 30, 2022: EEH Units Held % EEH Units Held % Total EEH As of December 31, 2021 53,467,307 60.9 % 34,344,532 39.1 % 87,811,839 EEH Units issued in connection with the Chisholm Acquisition 19,417,476 — 19,417,476 EEH Units issued in connection with the Bighorn Acquisition 5,650,977 — 5,650,977 EEH Units issued in connection with the Conversion of Preferred Stock 25,225,225 — 25,225,225 EEH Units issued in connection with the Titus Acquisition 3,857,015 — 3,857,015 EEH Units and Class B Common Stock converted to Class A Common Stock 82,891 (82,891) — EEH Units issued in connection with the vesting of restricted stock units and performance-based units 716,035 — 716,035 As of September 30, 2022 108,416,926 76.0 % 34,261,641 24.0 % 142,678,567 |
Net Income (Loss) Per Common _2
Net Income (Loss) Per Common Share (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Earnings Per Share [Abstract] | |
Schedule of Reconciliation of Net Income (Loss) Per Common Share | A reconciliation of Net income (loss) per common share is as follows: Three Months Ended Nine Months Ended (In thousands, except per share amounts) 2022 2021 2022 2021 Net income (loss) attributable to Earthstone Energy, Inc. $ 211,456 $ 10,418 $ 322,863 $ (4,286) Net income (loss) attributable to Earthstone Energy, Inc. from assumed conversion of Series A Convertible Preferred Stock (2) 1,068 — 12,388 — Net income (loss) attributable to Earthstone Energy, Inc. - Diluted $ 212,524 $ 10,418 $ 335,251 $ (4,286) Net income (loss) per common share attributable to Earthstone Energy, Inc.: Basic $ 2.01 $ 0.21 $ 3.91 $ (0.09) Diluted $ 1.94 $ 0.20 $ 3.61 $ (0.09) Weighted average common shares outstanding Basic 105,254,778 49,243,185 82,483,635 45,406,952 Add potentially dilutive securities: Unvested restricted stock units (1) 353,889 525,475 466,453 — Unvested performance units (1) 2,024,871 2,894,282 2,133,158 — Series A Convertible Preferred Stock (2) 1,645,123 — 7,761,608 — Diluted weighted average common shares outstanding 109,278,661 52,662,942 92,844,854 45,406,952 (1) The 1,099,800 performance units granted on January 27, 2021 were excluded for all periods presented due to an assumed settlement in cash and the liability treatment described in Note 9. Stock-Based Compensation. For the nine months ended September 30, 2021, there were no dilutive effects related to unvested restricted stock units or performance units due to the loss for the period. (2) On April 14, 2022, Earthstone issued 280,000 shares of Series A Convertible Preferred Stock which automatically converted into 25,225,225 shares of Class A Common Stock on July 6, 2022. Under the “If-Converted” method, the shares would have been assumed issued on April 14, 2022, which would have resulted in an additional allocation of Net income (loss) attributable to Earthstone Energy, Inc. of $1.1 million and $12.4 million for the three and nine months ended September 30, 2022, respectively. |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
Schedule of Unvested RSU and PSU Award Activity | The table below summarizes RSU award activity for the nine months ended September 30, 2022: Shares Weighted-Average Grant Date Fair Value Unvested RSUs at December 31, 2021 771,817 $ 5.91 Granted 511,615 $ 13.75 Forfeited (14,934) $ 7.93 Vested (491,107) $ 7.77 Unvested RSUs at September 30, 2022 777,391 $ 9.86 The table below summarizes PSU activity for the nine months ended September 30, 2022: Shares Weighted-Average Grant Date Fair Value Unvested PSUs at December 31, 2021 2,751,725 $ 8.42 Granted 472,485 $ 19.42 Vested (608,125) $ 9.30 Unvested PSUs at September 30, 2022 2,616,085 $ 10.20 |
Schedule of Total Shareholder Return Goals | Between 0x to 2.0x of the Performance Units are eligible to be earned based on Earthstone achieving an annualized TSR based on the following pre-established goals: Earthstone’s Annualized TSR TSR Multiplier 23.9% or greater 2 14.5% 1 8.4% 0.5 Less than 8.4% 0 |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Debt Disclosure [Abstract] | |
Schedule of Long-Term Debt | The Company's long-term debt consisted of the following ( in thousands ): September 30, 2022 December 31, 2021 Revolving credit facility (1) $ 391,732 $ 320,000 Term loan under credit facility due 2027 250,000 — 8.000% Senior notes due 2027 550,000 — 1,191,732 320,000 Unamortized debt issuance costs on term loan (5,591) — Unamortized debt issuance costs on 8.000% Senior notes (11,592) — Long-term debt, net $ 1,174,549 $ 320,000 (1) Related to the revolving credit facility borrowings, the Company had debt issuance costs of $16.2 million and $6.7 million, net of accumulated amortization of $5.7 million and $3.3 million, as of September 30, 2022 and December 31, 2021, respectively. Unamortized deferred financing costs on the revolving credit facility borrowings are included in Other noncurrent assets in the Condensed Consolidated Balance Sheets. |
Asset Retirement Obligations (T
Asset Retirement Obligations (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Asset Retirement Obligation Disclosure [Abstract] | |
Summary of Asset Retirement Obligation Transactions | The following table summarizes the Company’s asset retirement obligation transactions recorded during the nine months ended September 30, 2022 (in thousands) : 2022 Beginning asset retirement obligations $ 15,866 Liabilities incurred 342 Liabilities settled (665) Acquisitions 20,078 Accretion expense 1,863 Divestitures (1,087) Revision of estimates 381 Ending asset retirement obligations $ 36,778 |
Fair Value Measurements - Fair
Fair Value Measurements - Fair Value of Financial Assets and Liabilities (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Financial assets | ||
Derivative asset - current | $ 14,950 | $ 1,348 |
Derivative asset - noncurrent | 5,526 | 157 |
Financial liabilities | ||
Derivative liability - current | 28,404 | 45,310 |
Derivative liability - noncurrent | 7,840 | 571 |
Fair Value on a Recurring Basis | ||
Financial assets | ||
Derivative asset - current | 14,950 | 1,348 |
Derivative asset - noncurrent | 5,526 | 157 |
Total financial assets | 20,476 | 1,505 |
Financial liabilities | ||
Derivative liability - current | 28,404 | 45,310 |
Derivative liability - noncurrent | 7,840 | 571 |
Share-based compensation liability - noncurrent | 13,474 | 6,324 |
Share-based compensation liability - current | 7,835 | |
Total financial liabilities | 49,718 | 60,040 |
Level 1 | Fair Value on a Recurring Basis | ||
Financial assets | ||
Derivative asset - current | 0 | 0 |
Derivative asset - noncurrent | 0 | 0 |
Total financial assets | 0 | 0 |
Financial liabilities | ||
Derivative liability - current | 0 | 0 |
Derivative liability - noncurrent | 0 | 0 |
Share-based compensation liability - noncurrent | 0 | 0 |
Share-based compensation liability - current | 0 | |
Total financial liabilities | 0 | 0 |
Level 2 | Fair Value on a Recurring Basis | ||
Financial assets | ||
Derivative asset - current | 14,950 | 1,348 |
Derivative asset - noncurrent | 5,526 | 157 |
Total financial assets | 20,476 | 1,505 |
Financial liabilities | ||
Derivative liability - current | 28,404 | 45,310 |
Derivative liability - noncurrent | 7,840 | 571 |
Share-based compensation liability - noncurrent | 13,474 | 6,324 |
Share-based compensation liability - current | 7,835 | |
Total financial liabilities | 49,718 | 60,040 |
Level 3 | Fair Value on a Recurring Basis | ||
Financial assets | ||
Derivative asset - current | 0 | 0 |
Derivative asset - noncurrent | 0 | 0 |
Total financial assets | 0 | 0 |
Financial liabilities | ||
Derivative liability - current | 0 | 0 |
Derivative liability - noncurrent | 0 | 0 |
Share-based compensation liability - noncurrent | 0 | 0 |
Share-based compensation liability - current | 0 | |
Total financial liabilities | $ 0 | $ 0 |
Fair Value Measurements - Narra
Fair Value Measurements - Narrative (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Apr. 12, 2022 | Dec. 31, 2021 |
Fair Value Disclosure, Asset and Liability, Not Measured at Fair Value [Line Items] | |||
Long-term debt, net | $ 1,174,549 | $ 320,000 | |
8.000% Senior Notes Due 2027 | Senior Notes | |||
Fair Value Disclosure, Asset and Liability, Not Measured at Fair Value [Line Items] | |||
Interest rate, stated percentage | 8% | 8% | |
Interest payable | $ 20,700 | ||
8.000% Senior Notes Due 2027 | Senior Notes | Portion at Other than Fair Value Measurement | |||
Fair Value Disclosure, Asset and Liability, Not Measured at Fair Value [Line Items] | |||
Interest rate, stated percentage | 8% | ||
Deferred financing costs | 11,600 | ||
Long-term debt, net | 538,400 | ||
Interest payable | 20,700 | ||
8.000% Senior Notes Due 2027 | Senior Notes | Estimate of Fair Value Measurement | |||
Fair Value Disclosure, Asset and Liability, Not Measured at Fair Value [Line Items] | |||
Fair value disclosure | $ 518,900 |
Derivative Financial Instrume_3
Derivative Financial Instruments - Open Crude Oil and Natural Gas Derivative Contracts (Details) | 9 Months Ended |
Sep. 30, 2022 MMBTU $ / bbl $ / MMBTU bbl | |
Crude Oil, Q4 2022 | Crude Oil | |
Derivative [Line Items] | |
Crude oil volume (Bbl) | bbl | 1,081,000 |
Weighted Average Price ($/Bbl / $/MMBtu) | $ / bbl | 66.70 |
Crude Oil, Q1 - Q4 2023 | Crude Oil | |
Derivative [Line Items] | |
Crude oil volume (Bbl) | bbl | 1,277,500 |
Weighted Average Price ($/Bbl / $/MMBtu) | $ / bbl | 76.20 |
Crude Oil Basis Swap, Q4 2022 | Crude Oil | |
Derivative [Line Items] | |
Crude oil volume (Bbl) | bbl | 3,128,000 |
Weighted Average Price ($/Bbl / $/MMBtu) | $ / bbl | 0.89 |
Crude Oil Basis Swap, Q1 - Q4 2023 | Crude Oil | |
Derivative [Line Items] | |
Crude oil volume (Bbl) | bbl | 9,488,500 |
Weighted Average Price ($/Bbl / $/MMBtu) | $ / bbl | 0.92 |
Natural Gas, Q4 2022 | Natural gas | |
Derivative [Line Items] | |
Natural gas volume (MMBtu) | MMBTU | 1,893,500 |
Weighted Average Price ($/Bbl / $/MMBtu) | $ / bbl | 3.33 |
Natural Gas, Q1-Q4 2023 | Natural gas | |
Derivative [Line Items] | |
Natural gas volume (MMBtu) | MMBTU | 3,670,000 |
Weighted Average Price ($/Bbl / $/MMBtu) | $ / bbl | 3.35 |
Natural Gas Basis Swap, Q4 2022 | Natural gas | |
Derivative [Line Items] | |
Natural gas volume (MMBtu) | MMBTU | 1,840,000 |
Weighted Average Price ($/Bbl / $/MMBtu) | (0.33) |
Natural Gas Basis Swap, Q1 - Q4 2023 | Natural gas | |
Derivative [Line Items] | |
Natural gas volume (MMBtu) | MMBTU | 36,500,000 |
Weighted Average Price ($/Bbl / $/MMBtu) | $ / bbl | (1.47) |
Natural Gas Basis Swap Q1 - Q1 2024 | Natural gas | |
Derivative [Line Items] | |
Natural gas volume (MMBtu) | MMBTU | 36,600,000 |
Weighted Average Price ($/Bbl / $/MMBtu) | $ / bbl | (1.05) |
Crude Oil Costless Collar Q4 2022 | Crude Oil | |
Derivative [Line Items] | |
Crude oil volume (Bbl) | bbl | 805,000 |
Derivative, floor price ($/Bbl / $/MMBtu) | 73.14 |
Derivative, ceiling price ($/Bbl / $/MMBtu) | 96.49 |
Crude Oil Costless Collar Q1 - Q4 2023 | Crude Oil | |
Derivative [Line Items] | |
Crude oil volume (Bbl) | bbl | 1,715,500 |
Derivative, floor price ($/Bbl / $/MMBtu) | 62.98 |
Derivative, ceiling price ($/Bbl / $/MMBtu) | 80.34 |
Natural Gas Costless Collar Q4 2022 | Natural gas | |
Derivative [Line Items] | |
Natural gas volume (MMBtu) | MMBTU | 8,686,500 |
Derivative, floor price ($/Bbl / $/MMBtu) | 4.57 |
Derivative, ceiling price ($/Bbl / $/MMBtu) | 10.17 |
Natural Gas Costless Collar Q1 - Q4 2023 | Natural gas | |
Derivative [Line Items] | |
Natural gas volume (MMBtu) | MMBTU | 17,298,000 |
Derivative, floor price ($/Bbl / $/MMBtu) | 3.77 |
Derivative, ceiling price ($/Bbl / $/MMBtu) | 7.49 |
Crude Oil Premium Puts Q4 2022 | Crude Oil | |
Derivative [Line Items] | |
Crude oil volume (Bbl) | bbl | 253,000 |
Derivative, option strike price ($/Bbl) | 80 |
Derivative, net of premium strike price ($/Bbl) | 75.79 |
Crude Oil Premium Puts Q1 - Q4 2023 | Crude Oil | |
Derivative [Line Items] | |
Crude oil volume (Bbl) | bbl | 1,750,500 |
Derivative, option strike price ($/Bbl) | 70 |
Derivative, net of premium strike price ($/Bbl) | 64.53 |
Derivative Financial Instrume_4
Derivative Financial Instruments - Location and Fair Value Amounts of All Derivative Instruments (Details) - Derivatives Not Designated as Hedging Contracts - Commodity contracts - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Derivative asset - current | ||
Derivative Asset [Abstract] | ||
Gross recognized assets | $ 53,601 | $ 3,191 |
Gross amounts offset, assets | (38,651) | (1,843) |
Total financial assets | 14,950 | 1,348 |
Derivative liability - current | ||
Derivative Liability [Abstract] | ||
Gross recognized liabilities | 67,055 | 47,153 |
Gross amounts offset, liabilities | (38,651) | (1,843) |
Total financial liabilities | 28,404 | 45,310 |
Derivative asset - noncurrent | ||
Derivative Asset [Abstract] | ||
Gross recognized assets | 12,941 | 2,721 |
Gross amounts offset, assets | (7,415) | (2,564) |
Total financial assets | 5,526 | 157 |
Derivative liability - noncurrent | ||
Derivative Liability [Abstract] | ||
Gross recognized liabilities | 15,255 | 3,135 |
Gross amounts offset, liabilities | (7,415) | (2,564) |
Total financial liabilities | $ 7,840 | $ 571 |
Derivative Financial Instrume_5
Derivative Financial Instruments - Realized and Unrealized Gains and Losses on Derivative Instruments (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Realized loss | $ 169,708 | $ 46,311 | ||
(Loss) gain on derivative contracts, net | $ 60,286 | $ (33,128) | (141,101) | (117,566) |
Derivatives Not Designated as Hedging Contracts | (Loss) Gain On Derivative Contracts, Net | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Unrealized gain (loss) | 119,209 | (12,244) | 28,607 | (71,255) |
Realized loss | (58,923) | (20,884) | (169,708) | (46,311) |
(Loss) gain on derivative contracts, net | $ 60,286 | $ (33,128) | $ (141,101) | $ (117,566) |
Acquisitions and Divestitures -
Acquisitions and Divestitures - Narrative (Details) $ / shares in Units, $ in Thousands | 2 Months Ended | 3 Months Ended | 6 Months Ended | 8 Months Ended | 9 Months Ended | |||||||||||
Aug. 10, 2022 USD ($) $ / shares shares | Jul. 01, 2022 USD ($) | Apr. 15, 2022 USD ($) | Apr. 14, 2022 USD ($) shares | Feb. 15, 2022 USD ($) $ / shares shares | Nov. 02, 2021 USD ($) shares | Jul. 20, 2021 USD ($) shares | Jan. 07, 2021 USD ($) $ / shares shares | Sep. 30, 2022 USD ($) | Sep. 30, 2022 USD ($) | Sep. 30, 2021 USD ($) | Jun. 30, 2021 USD ($) seller | Sep. 30, 2022 USD ($) | Sep. 30, 2022 USD ($) | Sep. 30, 2022 USD ($) | Sep. 30, 2021 USD ($) | |
Business Acquisition [Line Items] | ||||||||||||||||
Transaction costs | $ 1,778 | $ 293 | $ 12,118 | $ 2,906 | ||||||||||||
Discontinued Operations, Disposed of by Sale | Eagle Ford Divestiture | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Proceeds from divestiture | $ 25,600 | |||||||||||||||
Bighorn Acquisition | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Cash consideration | $ 627,800 | |||||||||||||||
Shares of class A common stock issued (in shares) | shares | 5,650,977 | |||||||||||||||
Pro forma revenue | $ 338,700 | |||||||||||||||
Pro forma operating expense | $ 112,000 | |||||||||||||||
Chisholm Acquisition | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Initial payment for asset acquisition | $ 313,900 | |||||||||||||||
Subsequent payment for asset acquisition | $ 70,000 | |||||||||||||||
Asset acquisition, percentage of voting interest acquired | 36% | |||||||||||||||
Pro forma revenue | $ 219,800 | |||||||||||||||
Pro forma operating expense | $ 86,700 | |||||||||||||||
Tracker Purchase Agreement | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Cash consideration | $ 18,800 | |||||||||||||||
Shares of class A common stock issued (in shares) | shares | 4,700,000 | |||||||||||||||
Tracker Purchase Agreement | Significant Shareholder | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Asset acquisition, percentage of voting interest acquired | 49% | |||||||||||||||
Sequel Purchase Agreement | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Cash consideration | $ 41,400 | |||||||||||||||
Shares of class A common stock issued (in shares) | shares | 1,500,000 | |||||||||||||||
Foreland Acquisition | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Cash consideration | $ 13,400 | |||||||||||||||
Shares of class A common stock issued (in shares) | shares | 2,611,111 | |||||||||||||||
B C C Acquisition | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Cash consideration | $ 20,500 | |||||||||||||||
Eagle Ford Acquisitions | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Cash consideration | $ 45,200 | |||||||||||||||
Number of separate sellers | seller | 4 | |||||||||||||||
Class A Common Stock | Bighorn Acquisition | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Shares of class A common stock issued (in shares) | shares | 5,650,977 | |||||||||||||||
Class A Common Stock | Chisholm Acquisition | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Shares of class A common stock issued (in shares) | shares | 19,417,476 | |||||||||||||||
Share price (in dollars per share) | $ / shares | $ 12.85 | |||||||||||||||
Class A Common Stock | Tracker And Sequel Aquisitions | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Shares of class A common stock issued (in shares) | shares | 6,200,000 | |||||||||||||||
Class A Common Stock | Tracker Purchase Agreement | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Shares of class A common stock issued (in shares) | shares | 4,700,000 | |||||||||||||||
Titus Acquisition | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Net cash consideration | $ 565,800 | |||||||||||||||
Pro forma revenue | $ 88,900 | |||||||||||||||
Pro forma operating expense | $ 39,700 | |||||||||||||||
Transaction costs | 700 | 700 | ||||||||||||||
Titus Acquisition | Class A Common Stock | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Shares acquired (in shares) | shares | 3,857,015 | |||||||||||||||
Class A common stock price as of January 7, 2021 (in dollars per share) | $ / shares | $ 13.89 | |||||||||||||||
IRM Acquisition | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Net cash consideration | $ 140,500 | |||||||||||||||
Transaction costs | $ 300 | $ 10,600 | ||||||||||||||
IRM Acquisition | Class A Common Stock | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Shares acquired (in shares) | shares | 12,719,594 | |||||||||||||||
Class A common stock price as of January 7, 2021 (in dollars per share) | $ / shares | $ 6.02 |
Acquisitions and Divestitures_2
Acquisitions and Divestitures - Business Acquisitions, by Acquisition (Details) - USD ($) $ / shares in Units, $ in Thousands | Aug. 10, 2022 | Jan. 07, 2021 |
Titus Acquisition | ||
Business Acquisition [Line Items] | ||
Cash consideration | $ 565,777 | |
Total consideration transferred | 619,351 | |
Fair value of assets acquired: | ||
Oil and gas properties | 623,119 | |
Amount attributable to assets acquired | 623,119 | |
Fair value of liabilities assumed: | ||
Current liabilities | 2,854 | |
Asset retirement obligation - noncurrent | 914 | |
Amount attributable to liabilities assumed | $ 3,768 | |
Titus Acquisition | Class A Common Stock | ||
Business Acquisition [Line Items] | ||
Shares of Class A Common Stock issued (in shares) | 3,857,015 | |
Class A Common Stock price (in dollars per share) | $ 13.89 | |
Class A Common Stock consideration | $ 53,574 | |
IRM Acquisition | ||
Business Acquisition [Line Items] | ||
Cash consideration | $ 140,507 | |
Total consideration transferred | 217,079 | |
Fair value of assets acquired: | ||
Cash | 4,763 | |
Other current assets | 11,524 | |
Oil and gas properties | 224,112 | |
Other non-current assets | 252 | |
Amount attributable to assets acquired | 240,651 | |
Fair value of liabilities assumed: | ||
Derivative liability | 10,177 | |
Other current liabilities | 5,196 | |
Asset retirement obligation - noncurrent | 8,199 | |
Amount attributable to liabilities assumed | $ 23,572 | |
IRM Acquisition | Class A Common Stock | ||
Business Acquisition [Line Items] | ||
Shares of Class A Common Stock issued (in shares) | 12,719,594 | |
Class A Common Stock price (in dollars per share) | $ 6.02 | |
Class A Common Stock consideration | $ 76,572 |
Acquisitions and Divestitures_3
Acquisitions and Divestitures - Asset Acquisition (Details) - USD ($) $ / shares in Units, $ in Thousands | 9 Months Ended | |||
Apr. 14, 2022 | Feb. 15, 2022 | Jul. 20, 2021 | Sep. 30, 2022 | |
Asset Acquisition [Line Items] | ||||
Noncurrent liabilities - asset retirement obligations | $ 342 | |||
Bighorn Acquisition | ||||
Asset Acquisition [Line Items] | ||||
Shares of class A common stock issued (in shares) | 5,650,977 | |||
Cash consideration | $ 625,801 | |||
Direct transaction costs | 2,048 | |||
Total consideration transferred | 705,606 | |||
Current assets | 770 | |||
Oil and gas properties | 746,825 | |||
Amount attributable to assets acquired | 747,595 | |||
Suspense payable | 25,710 | |||
Other current liabilities | 3,085 | |||
Noncurrent liabilities - asset retirement obligations | 13,194 | |||
Amount attributable to liabilities assumed | $ 41,989 | |||
Bighorn Acquisition | Class A Common Stock | ||||
Asset Acquisition [Line Items] | ||||
Shares of class A common stock issued (in shares) | 5,650,977 | |||
Class A common stock price (in dollar per share) | $ 13.76 | |||
Class A Common Stock consideration | $ 77,757 | |||
Chisholm Acquisition | ||||
Asset Acquisition [Line Items] | ||||
Cash consideration | $ 383,938 | |||
Total consideration transferred | 633,453 | |||
Oil and gas properties | 641,494 | |||
Amount attributable to assets acquired | 641,494 | |||
Other current liabilities | 2,070 | |||
Noncurrent liabilities - asset retirement obligations | 5,971 | |||
Amount attributable to liabilities assumed | $ 8,041 | |||
Chisholm Acquisition | Class A Common Stock | ||||
Asset Acquisition [Line Items] | ||||
Shares of class A common stock issued (in shares) | 19,417,476 | |||
Class A common stock price (in dollar per share) | $ 12.85 | |||
Class A Common Stock consideration | $ 249,515 | |||
Tracker And Sequel Aquisitions | ||||
Asset Acquisition [Line Items] | ||||
Cash consideration | $ 60,159 | |||
Direct transaction costs | 1,715 | |||
Total consideration transferred | 123,688 | |||
Oil and gas properties | 124,288 | |||
Amount attributable to assets acquired | 124,288 | |||
Noncurrent liabilities - asset retirement obligations | 600 | |||
Amount attributable to liabilities assumed | $ 600 | |||
Tracker And Sequel Aquisitions | Class A Common Stock | ||||
Asset Acquisition [Line Items] | ||||
Shares of class A common stock issued (in shares) | 6,200,000 | |||
Class A common stock price (in dollar per share) | $ 9.97 | |||
Class A Common Stock consideration | $ 61,814 |
Acquisitions and Divestitures_4
Acquisitions and Divestitures - Business Acquisition, Pro Forma Information (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Business Combination, Asset Acquisition and Divestitures [Abstract] | ||||
Revenue | $ 1,016,529 | $ 450,618 | $ 1,910,133 | $ 963,414 |
Income before taxes | 671,440 | 53,933 | 1,004,806 | 41,410 |
Net income | 610,922 | 53,127 | 923,133 | 40,808 |
Less: Net income attributable to noncontrolling interest | 179,944 | 23,093 | 282,808 | 17,639 |
Net income attributable to Earthstone Energy, Inc. | $ 430,978 | $ 30,034 | $ 640,325 | $ 23,169 |
Basic (in dollars per share) | $ 3.98 | $ 0.29 | $ 5.92 | $ 0.24 |
Diluted (in dollars per share) | $ 3.85 | $ 0.28 | $ 5.52 | $ 0.24 |
Oil and Natural Gas Propertie_2
Oil and Natural Gas Properties - Narrative (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Oil And Natural Gas Properties [Line Items] | ||||
Impairment of oil and gas properties | $ 0 | $ 0 | $ 0 | $ 0 |
Proved Oil And Natural Gas Properties | ||||
Oil And Natural Gas Properties [Line Items] | ||||
Depletion expenses | $ 90,400,000 | $ 26,900,000 | $ 190,800,000 | $ 77,000,000 |
Unproved Oil And Gas Properties | Minimum | ||||
Oil And Natural Gas Properties [Line Items] | ||||
Unproved oil and gas lease term | 3 years | |||
Unproved Oil And Gas Properties | Maximum | ||||
Oil And Natural Gas Properties [Line Items] | ||||
Unproved oil and gas lease term | 5 years |
Oil and Natural Gas Propertie_3
Oil and Natural Gas Properties - Capital Expenditures Of Oil and Gas (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended |
Sep. 30, 2022 | Sep. 30, 2022 | |
Oil And Natural Gas Properties [Line Items] | ||
Total capital expenditures | $ 147,152 | $ 348,712 |
Development costs | ||
Oil And Natural Gas Properties [Line Items] | ||
Total capital expenditures | 146,845 | 348,145 |
Leasehold costs | ||
Oil And Natural Gas Properties [Line Items] | ||
Total capital expenditures | $ 307 | $ 567 |
Noncontrolling Interest - Summa
Noncontrolling Interest - Summary of Changes in Noncontrolling Interest (Details) - shares | 9 Months Ended | |||
Apr. 14, 2022 | Feb. 15, 2022 | Sep. 30, 2022 | Dec. 31, 2021 | |
Class A Common Stock | ||||
Stockholders' Equity Attributable to Noncontrolling Interest [Roll Forward] | ||||
Outstanding, beginning balance (in shares) | 53,467,307 | |||
Outstanding, ending balance (in shares) | 108,416,926 | |||
Chisholm Acquisition | Class A Common Stock | ||||
Stockholders' Equity Attributable to Noncontrolling Interest [Roll Forward] | ||||
EEH Units issued in connect with Acquisition (in shares) | 19,417,476 | |||
Bighorn Acquisition | Class A Common Stock | ||||
Stockholders' Equity Attributable to Noncontrolling Interest [Roll Forward] | ||||
EEH Units issued in connect with Acquisition (in shares) | 5,650,977 | |||
Earthstone Energy Holdings, LLC | ||||
Stockholders' Equity Attributable to Noncontrolling Interest [Roll Forward] | ||||
Outstanding, beginning balance (in shares) | 87,811,839 | |||
Outstanding, ending balance (in shares) | 142,678,567 | |||
Earthstone Energy Holdings, LLC | Restricted Stock Units And Performance Units | ||||
Stockholders' Equity Attributable to Noncontrolling Interest [Roll Forward] | ||||
EEH Units issued in connection with the vesting of restricted stock units and performance-based units (in shares) | 716,035 | |||
Earthstone Energy Holdings, LLC | Convertible Preferred Stock | ||||
Stockholders' Equity Attributable to Noncontrolling Interest [Roll Forward] | ||||
EEH units and class B common stock converted to class A common stock (in shares) | 25,225,225 | |||
Earthstone Energy Holdings, LLC | Class A Common Stock | ||||
Stockholders' Equity Attributable to Noncontrolling Interest [Roll Forward] | ||||
EEH units and class B common stock converted to class A common stock (in shares) | 0 | |||
Earthstone Energy Holdings, LLC | Chisholm Acquisition | ||||
Stockholders' Equity Attributable to Noncontrolling Interest [Roll Forward] | ||||
EEH Units issued in connect with Acquisition (in shares) | 19,417,476 | |||
Earthstone Energy Holdings, LLC | Bighorn Acquisition | ||||
Stockholders' Equity Attributable to Noncontrolling Interest [Roll Forward] | ||||
EEH Units issued in connect with Acquisition (in shares) | 5,650,977 | |||
Earthstone Energy Holdings, LLC | Titus Acquisition | ||||
Stockholders' Equity Attributable to Noncontrolling Interest [Roll Forward] | ||||
EEH Units issued in connect with Acquisition (in shares) | 3,857,015 | |||
EEH Units Held By Earthstone and Lynden US | Earthstone Energy Holdings, LLC | ||||
Stockholders' Equity Attributable to Noncontrolling Interest [Roll Forward] | ||||
Percentage of EEH Units Held By Earthstone and Lynden | 76% | 60.90% | ||
EEH Units Held By Earthstone and Lynden US | Earthstone Energy Holdings, LLC | ||||
Stockholders' Equity Attributable to Noncontrolling Interest [Roll Forward] | ||||
Outstanding, beginning balance (in shares) | 53,467,307 | |||
Outstanding, ending balance (in shares) | 108,416,926 | |||
EEH Units Held By Earthstone and Lynden US | Earthstone Energy Holdings, LLC | Restricted Stock Units And Performance Units | ||||
Stockholders' Equity Attributable to Noncontrolling Interest [Roll Forward] | ||||
EEH Units issued in connection with the vesting of restricted stock units and performance-based units (in shares) | 716,035 | |||
EEH Units Held By Earthstone and Lynden US | Earthstone Energy Holdings, LLC | Convertible Preferred Stock | ||||
Stockholders' Equity Attributable to Noncontrolling Interest [Roll Forward] | ||||
EEH units and class B common stock converted to class A common stock (in shares) | 25,225,225 | |||
EEH Units Held By Earthstone and Lynden US | Earthstone Energy Holdings, LLC | Class A Common Stock | ||||
Stockholders' Equity Attributable to Noncontrolling Interest [Roll Forward] | ||||
EEH units and class B common stock converted to class A common stock (in shares) | 82,891 | |||
EEH Units Held By Earthstone and Lynden US | Earthstone Energy Holdings, LLC | Chisholm Acquisition | ||||
Stockholders' Equity Attributable to Noncontrolling Interest [Roll Forward] | ||||
EEH Units issued in connect with Acquisition (in shares) | 19,417,476 | |||
EEH Units Held By Earthstone and Lynden US | Earthstone Energy Holdings, LLC | Bighorn Acquisition | ||||
Stockholders' Equity Attributable to Noncontrolling Interest [Roll Forward] | ||||
EEH Units issued in connect with Acquisition (in shares) | 5,650,977 | |||
EEH Units Held By Earthstone and Lynden US | Earthstone Energy Holdings, LLC | Titus Acquisition | ||||
Stockholders' Equity Attributable to Noncontrolling Interest [Roll Forward] | ||||
EEH Units issued in connect with Acquisition (in shares) | 3,857,015 | |||
EEH Units Held By Others | Earthstone Energy Holdings, LLC | ||||
Stockholders' Equity Attributable to Noncontrolling Interest [Roll Forward] | ||||
Outstanding, beginning balance (in shares) | 34,344,532 | |||
Outstanding, ending balance (in shares) | 34,261,641 | |||
EEH Units Held By Others | Earthstone Energy Holdings, LLC | Restricted Stock Units And Performance Units | ||||
Stockholders' Equity Attributable to Noncontrolling Interest [Roll Forward] | ||||
EEH Units issued in connection with the vesting of restricted stock units and performance-based units (in shares) | 0 | |||
EEH Units Held By Others | Earthstone Energy Holdings, LLC | Convertible Preferred Stock | ||||
Stockholders' Equity Attributable to Noncontrolling Interest [Roll Forward] | ||||
EEH units and class B common stock converted to class A common stock (in shares) | 0 | |||
EEH Units Held By Others | Earthstone Energy Holdings, LLC | Class A Common Stock | ||||
Stockholders' Equity Attributable to Noncontrolling Interest [Roll Forward] | ||||
EEH units and class B common stock converted to class A common stock (in shares) | (82,891) | |||
EEH Units Held By Others | Earthstone Energy Holdings, LLC | Chisholm Acquisition | ||||
Stockholders' Equity Attributable to Noncontrolling Interest [Roll Forward] | ||||
EEH Units issued in connect with Acquisition (in shares) | 0 | |||
EEH Units Held By Others | Earthstone Energy Holdings, LLC | Bighorn Acquisition | ||||
Stockholders' Equity Attributable to Noncontrolling Interest [Roll Forward] | ||||
EEH Units issued in connect with Acquisition (in shares) | 0 | |||
EEH Units Held By Others | Earthstone Energy Holdings, LLC | Titus Acquisition | ||||
Stockholders' Equity Attributable to Noncontrolling Interest [Roll Forward] | ||||
EEH Units issued in connect with Acquisition (in shares) | 0 | |||
EEH Units Held By Others | Earthstone Energy Holdings, LLC | ||||
Stockholders' Equity Attributable to Noncontrolling Interest [Roll Forward] | ||||
Percentage of EEH Units Held By Others | 24% | 39.10% |
Net Income (Loss) Per Common _3
Net Income (Loss) Per Common Share - Reconciliation of Net Income (Loss) Per Common Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | |||||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Jul. 06, 2022 | Apr. 14, 2022 | Dec. 31, 2021 | |
Class of Stock [Line Items] | |||||||
Net income (loss) attributable to Earthstone Energy, Inc. | $ 211,456 | $ 10,418 | $ 322,863 | $ (4,286) | |||
Net income (loss) attributable to Earthstone Energy, Inc. from assumed conversion of Series A Convertible Preferred Stock | 1,068 | 0 | 12,388 | 0 | |||
Net income (loss) attributable to Earthstone Energy, Inc. diluted | $ 212,524 | $ 10,418 | $ 335,251 | $ (4,286) | |||
Net income (loss) per common share attributable to Earthstone Energy, Inc.: | |||||||
Basic (in dollars per share) | $ 2.01 | $ 0.21 | $ 3.91 | $ (0.09) | |||
Diluted (in dollars per share) | $ 1.94 | $ 0.20 | $ 3.61 | $ (0.09) | |||
Weighted average common shares outstanding | |||||||
Basic (in shares) | 105,254,778 | 49,243,185 | 82,483,635 | 45,406,952 | |||
Add potentially dilutive securities: | |||||||
Unvested restricted stock units (in shares) | 353,889 | 525,475 | 466,453 | 0 | |||
Unvested performance units (in shares) | 2,024,871 | 2,894,282 | 2,133,158 | 0 | |||
Series A Convertible Preferred Stock (in shares) | 1,645,123 | 0 | 7,761,608 | 0 | |||
Diluted weighted average common shares outstanding (in shares) | 109,278,661 | 52,662,942 | 92,844,854 | 45,406,952 | |||
Antidilutive securities (in shares) | 1,099,800 | 1,099,800 | 1,099,800 | 1,099,800 | |||
Preferred stock, shares issued (in shares) | 0 | 0 | 0 | ||||
Series A Convertible Preferred Stock | |||||||
Class of Stock [Line Items] | |||||||
Net income (loss) attributable to Earthstone Energy, Inc. from assumed conversion of Series A Convertible Preferred Stock | $ 1,100 | $ 12,400 | |||||
Add potentially dilutive securities: | |||||||
Preferred stock, shares issued (in shares) | 0 | 0 | 280,000 | 0 | |||
Class A Common Stock | |||||||
Add potentially dilutive securities: | |||||||
Convertible preferred stock, shares issued upon conversion (in shares) | 25,225,225 |
Net Income (Loss) Per Common _4
Net Income (Loss) Per Common Share - Narrative (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||||
Less: Net income (loss) attributable to noncontrolling interest | $ 87,856 | $ 8,420 | $ 142,597 | $ (3,263) | |
Class B Common Stock | |||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||||
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 | $ 0.001 | ||
Less: Net income (loss) attributable to noncontrolling interest | $ 87,900 | $ 8,400 | $ 142,600 | $ (3,300) |
Common Stock and Preferred St_2
Common Stock and Preferred Stock (Details) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||||||||
Aug. 10, 2022 USD ($) shares | Apr. 14, 2022 USD ($) shares | Feb. 15, 2022 USD ($) shares | Jan. 30, 2022 USD ($) $ / shares shares | Jan. 07, 2021 USD ($) shares | Sep. 30, 2022 USD ($) $ / shares shares | Jun. 30, 2022 USD ($) | Mar. 31, 2022 USD ($) | Sep. 30, 2021 USD ($) shares | Mar. 31, 2021 USD ($) | Sep. 30, 2022 $ / shares shares | Sep. 30, 2021 shares | Jul. 06, 2022 shares | Dec. 31, 2021 $ / shares shares | |
Capital Unit [Line Items] | ||||||||||||||
Shares issued in connection with Acquisition | $ | $ 53,574 | $ 77,757 | $ 249,515 | $ 61,814 | $ 76,572 | |||||||||
Preferred stock, par value (in dollars per share) | $ / shares | $ 0.001 | $ 0.001 | $ 0.001 | |||||||||||
Preferred stock, shares issued (in shares) | 0 | 0 | 0 | |||||||||||
Preferred stock, shares outstanding (in shares) | 0 | 0 | 0 | |||||||||||
Securities Purchase Agreement | ||||||||||||||
Capital Unit [Line Items] | ||||||||||||||
Sale of stock, proceeds received on transaction | $ | $ 279,300 | $ 280,000 | ||||||||||||
Member Units | Bold Contribution Agreement | ||||||||||||||
Capital Unit [Line Items] | ||||||||||||||
Stock conversion (in shares) | 1 | |||||||||||||
IRM Acquisition | ||||||||||||||
Capital Unit [Line Items] | ||||||||||||||
EEH Units issued in connect with Acquisition (in shares) | 12,719,594 | |||||||||||||
Shares issued in connection with Acquisition | $ | $ 76,600 | |||||||||||||
Class A Common Stock | ||||||||||||||
Capital Unit [Line Items] | ||||||||||||||
Common stock, shares issued (in shares) | 108,416,926 | 108,416,926 | 53,467,307 | |||||||||||
Common stock, shares outstanding (in shares) | 108,416,926 | 108,416,926 | 53,467,307 | |||||||||||
Convertible preferred stock, shares issued upon conversion (in shares) | 25,225,225 | |||||||||||||
Class A Common Stock | Securities Purchase Agreement | ||||||||||||||
Capital Unit [Line Items] | ||||||||||||||
Preferred stock, conversion ratio | 90.0900900900901 | |||||||||||||
Sale of stock, price per share (in dollars per share) | $ / shares | $ 11.10 | |||||||||||||
Class A Common Stock | Bold Contribution Agreement | ||||||||||||||
Capital Unit [Line Items] | ||||||||||||||
Stock conversion (in shares) | 1 | |||||||||||||
Class A Common Stock | Titus Acquisition | ||||||||||||||
Capital Unit [Line Items] | ||||||||||||||
EEH Units issued in connect with Acquisition (in shares) | 3,857,015 | |||||||||||||
Shares issued in connection with Acquisition | $ | $ 53,600 | |||||||||||||
Class A Common Stock | 2014 Plan | ||||||||||||||
Capital Unit [Line Items] | ||||||||||||||
Shares issued in transaction (in shares) | 165,336 | 220,219 | 1,099,232 | 1,162,879 | ||||||||||
Common stock repurchased (in shares) | 48,073 | 65,106 | 383,197 | 389,213 | ||||||||||
Class A Common Stock | Chisholm Acquisition | ||||||||||||||
Capital Unit [Line Items] | ||||||||||||||
EEH Units issued in connect with Acquisition (in shares) | 19,417,476 | |||||||||||||
Shares issued in connection with Acquisition | $ | $ 249,500 | |||||||||||||
Class A Common Stock | Bighorn Acquisition | ||||||||||||||
Capital Unit [Line Items] | ||||||||||||||
EEH Units issued in connect with Acquisition (in shares) | 5,650,977 | |||||||||||||
Shares issued in connection with Acquisition | $ | $ 77,800 | |||||||||||||
Class B Common Stock | ||||||||||||||
Capital Unit [Line Items] | ||||||||||||||
Common stock, shares issued (in shares) | 34,261,641 | 34,261,641 | 34,344,532 | |||||||||||
Common stock, shares outstanding (in shares) | 34,261,641 | 34,261,641 | 34,344,532 | |||||||||||
EEH units and class B common stock converted to class A common stock (in shares) | 0 | 43,882 | 82,891 | 655,376 | ||||||||||
Series A Convertible Preferred Stock | ||||||||||||||
Capital Unit [Line Items] | ||||||||||||||
Preferred stock, par value (in dollars per share) | $ / shares | $ 0.001 | $ 0.001 | $ 0.001 | |||||||||||
Preferred stock, shares issued (in shares) | 280,000 | 0 | 0 | 0 | ||||||||||
Preferred stock, shares outstanding (in shares) | 0 | 0 | 0 | |||||||||||
Series A Convertible Preferred Stock | Securities Purchase Agreement | ||||||||||||||
Capital Unit [Line Items] | ||||||||||||||
Sale of stock, number of shares issued in transaction (in shares) | 280,000 | 280,000 | ||||||||||||
Preferred stock, par value (in dollars per share) | $ / shares | $ 0.001 | |||||||||||||
Sale of stock, price per share (in dollars per share) | $ / shares | $ 1,000 |
Stock-Based Compensation - Narr
Stock-Based Compensation - Narrative (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 9 Months Ended | ||||||||
Feb. 01, 2022 | Jan. 31, 2022 | Jan. 27, 2021 | Jan. 30, 2020 | Jan. 28, 2019 | Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Restricted Stock Units | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Performance-based restricted stock granted (in shares) | 511,615 | |||||||||
Weighted average fair value per share (in dollars per share) | $ 9.86 | $ 9.86 | $ 5.91 | |||||||
Vested in period (in shares) | 491,107 | |||||||||
Performance Stock Units | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Performance-based restricted stock granted (in shares) | 472,485 | |||||||||
Weighted average fair value per share (in dollars per share) | $ 10.20 | $ 10.20 | $ 8.42 | |||||||
Share-based compensation liability related to PSUs | $ 13.5 | $ 13.5 | $ 6.3 | |||||||
Vested in period (in shares) | 608,125 | |||||||||
Performance Stock Units | Minimum | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Relative total shareholder return, percentage | 0% | |||||||||
Performance Stock Units | Maximum | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Relative total shareholder return, percentage | 200% | |||||||||
2014 Plan | Restricted Stock Units | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Number of shares authorized to be issued under the plan (in shares) | 12,000,000 | 12,000,000 | ||||||||
Unrecognized compensation expense related to unvested stock | $ 7.2 | $ 7.2 | ||||||||
Weighted average remaining vesting period of unrecognized compensation expense | 1 year 3 months 10 days | |||||||||
Stock-based compensation expense | 1.5 | $ 1.2 | $ 4.2 | $ 3.9 | ||||||
2014 Plan | Restricted Stock Units | Bold Contribution Agreement | Class A Common Stock | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Number of shares of common stock that each holder has contingent right to receive (in shares) | 1 | |||||||||
2014 Plan | Performance Stock Units | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Stock-based compensation expense | 1.8 | $ 1.7 | $ 10.9 | $ 6.7 | ||||||
Performance-based restricted stock granted (in shares) | 1,099,800 | 669,550 | ||||||||
Vested in period (in shares) | 608,125 | |||||||||
Settlement rate | 197% | |||||||||
Settlement rate in common stock | 100% | |||||||||
Unrecognized compensation expense related to PSU awards | $ 17.7 | $ 17.7 | ||||||||
Remaining vesting period of unrecognized compensation expense (in years) | 1 year 1 month 6 days | |||||||||
2014 Plan | Performance Stock Units | Grant Date 2020 | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Performance-based restricted stock granted (in shares) | 1,043,800 | |||||||||
Risk-free interest rate | 1.40% | |||||||||
Expected volatility (as a percent) | 62% | |||||||||
Weighted average fair value per share (in dollars per share) | $ 5.36 | $ 5.36 | ||||||||
2014 Plan | Performance Stock Units | Grant Date 2022 | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Performance-based restricted stock granted (in shares) | 472,485 | |||||||||
Risk-free interest rate | 1.40% | |||||||||
Expected volatility (as a percent) | 86% | |||||||||
Weighted average fair value per share (in dollars per share) | $ 19.42 | $ 19.42 | ||||||||
2014 Plan | Class A Common Stock | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Issuance of shares of class A common stock (in shares) | 608,125 |
Stock-Based Compensation - Unve
Stock-Based Compensation - Unvested RSU and PSU Award Activity (Details) | 9 Months Ended |
Sep. 30, 2022 $ / shares shares | |
Restricted Stock Units | |
Shares | |
Unvested at beginning period (in shares) | shares | 771,817 |
Granted (in shares) | shares | 511,615 |
Forfeited (in shares) | shares | (14,934) |
Vested (in shares) | shares | (491,107) |
Unvested at end period (in shares) | shares | 777,391 |
Weighted-Average Grant Date Fair Value | |
Unvested at beginning of period, weighted-average grant date fair value (in dollars per share) | $ / shares | $ 5.91 |
Granted, weighted-average grant date fair value (in dollars per share) | $ / shares | 13.75 |
Forfeited, weighted-average grant date fair value (in dollars per share) | $ / shares | 7.93 |
Vested, weighted-average grant date fair value (in dollars per share) | $ / shares | 7.77 |
Unvested at end of period, Weighted-Average Grant Date Fair Value (in dollars per share) | $ / shares | $ 9.86 |
Performance Stock Units | |
Shares | |
Unvested at beginning period (in shares) | shares | 2,751,725 |
Granted (in shares) | shares | 472,485 |
Vested (in shares) | shares | (608,125) |
Unvested at end period (in shares) | shares | 2,616,085 |
Weighted-Average Grant Date Fair Value | |
Unvested at beginning of period, weighted-average grant date fair value (in dollars per share) | $ / shares | $ 8.42 |
Granted, weighted-average grant date fair value (in dollars per share) | $ / shares | 19.42 |
Vested, weighted-average grant date fair value (in dollars per share) | $ / shares | 9.30 |
Unvested at end of period, Weighted-Average Grant Date Fair Value (in dollars per share) | $ / shares | $ 10.20 |
Stock-Based Compensation - Tota
Stock-Based Compensation - Total Shareholder Return Goals (Details) - Performance Stock Units | 9 Months Ended |
Sep. 30, 2022 | |
Maximum | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Earthstone’s Annualized TSR | 8.40% |
23.9% or greater | Minimum | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Earthstone’s Annualized TSR | 23.90% |
23.9% or greater | Maximum | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
TSR Multiplier | 200% |
0.145 | Minimum | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Earthstone’s Annualized TSR | 14.50% |
0.145 | Maximum | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
TSR Multiplier | 100% |
7.7% | Minimum | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Earthstone’s Annualized TSR | 8.40% |
7.7% | Maximum | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
TSR Multiplier | 50% |
Less than 8.4% | Maximum | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
TSR Multiplier | 0% |
Long-Term Debt - Schedule of De
Long-Term Debt - Schedule of Debt (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Apr. 12, 2022 | Dec. 31, 2021 |
Debt Instrument [Line Items] | |||
Long-term debt, gross | $ 1,191,732 | $ 320,000 | |
Long-term debt, net | 1,174,549 | 320,000 | |
Revolving Credit Facility | Line of Credit | |||
Debt Instrument [Line Items] | |||
Long-term debt, gross | 391,732 | 320,000 | |
Unamortized debt issuance costs | (16,200) | (6,700) | |
Accumulated amortization | 5,700 | 3,300 | |
Term loan | Line of Credit | |||
Debt Instrument [Line Items] | |||
Long-term debt, gross | 250,000 | 0 | |
Unamortized debt issuance costs | $ (5,591) | 0 | |
8.000% Senior Notes Due 2027 | Senior Notes | |||
Debt Instrument [Line Items] | |||
Interest rate, stated percentage | 8% | 8% | |
Long-term debt, gross | $ 550,000 | 0 | |
Unamortized debt issuance costs | $ (11,592) | $ 0 |
Long-Term Debt - Narrative (Det
Long-Term Debt - Narrative (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||||||||||
Aug. 10, 2022 | Apr. 12, 2022 | Nov. 21, 2019 | Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Sep. 29, 2022 | Jun. 02, 2022 | Jun. 01, 2022 | Apr. 14, 2022 | Jan. 30, 2022 | Dec. 31, 2021 | |
Debt Instrument [Line Items] | |||||||||||||
Long-term debt outstanding | $ 1,174,549,000 | $ 1,174,549,000 | $ 320,000,000 | ||||||||||
Amortization of deferred financing costs | $ 3,723,000 | $ 581,000 | |||||||||||
Debt instrument, redemption period | 180 days | ||||||||||||
Debt Instrument, Redemption, Period Three | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Redemption price, percentage of principal amount redeemed | 25% | ||||||||||||
EEH Credit Agreement | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Current borrowing base under EEH credit agreement | $ 1,200,000,000 | $ 800,000,000 | $ 800,000,000 | $ 825,000,000 | 650,000,000 | ||||||||
Line of credit, borrowing base | 1,700,000,000 | $ 1,850,000,000 | $ 1,400,000,000 | $ 1,325,000,000 | |||||||||
Credit agreement, covenant, current ratio | 1 | ||||||||||||
Credit agreement, covenant, leverage ratio | 3.5 | ||||||||||||
Long-term debt outstanding | $ 320,000,000 | ||||||||||||
Additional borrowing base available under credit agreement | 558,300,000 | $ 558,300,000 | |||||||||||
Averaged interest rate on borrowings | 3.66% | 3.47% | |||||||||||
Commitment fees on borrowings | 1,000,000 | $ 200,000 | 1,100,000 | $ 600,000 | |||||||||
Amortization of deferred financing costs | 800,000 | 200,000 | 2,400,000 | 600,000 | |||||||||
Capitalized costs associated with borrowings | 1,000,000 | 2,800,000 | |||||||||||
EEH Credit Agreement | Minimum | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Basis spread on variable rate | 1.25% | ||||||||||||
Commitment fee percentage | 0.375% | ||||||||||||
EEH Credit Agreement | Maximum | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Basis spread on variable rate | 2.25% | ||||||||||||
Commitment fee percentage | 0.50% | ||||||||||||
EEH Credit Agreement | Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Basis spread on variable rate | 1% | ||||||||||||
EEH Credit Agreement | Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate | Minimum | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Basis spread on variable rate | 2.25% | ||||||||||||
EEH Credit Agreement | Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate | Maximum | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Basis spread on variable rate | 3.25% | ||||||||||||
EEH Credit Agreement | Federal Funds Rate | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Basis spread on variable rate | 0.50% | ||||||||||||
EEH Credit Agreement | Term Loan | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Current borrowing base under EEH credit agreement | $ 250,000,000 | ||||||||||||
Long-term debt outstanding | $ 250,000,000 | $ 250,000,000 | |||||||||||
Long-term debt, percentage bearing annual interest rate | 6.10% | 6.10% | |||||||||||
Averaged interest rate on borrowings | 6.01% | 6.01% | |||||||||||
Amortization of deferred financing costs | $ 200,000 | $ 200,000 | |||||||||||
Capitalized costs associated with borrowings | 5,800,000 | 5,800,000 | |||||||||||
EEH Credit Agreement | Term Loan | Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Basis spread on variable rate | 3.25% | ||||||||||||
Increase in interest rate | 0.25% | ||||||||||||
EEH Credit Agreement | Term Loan | Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate | Minimum | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Basis spread on variable rate | 2.25% | ||||||||||||
EEH Credit Agreement | Term Loan | Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate | Maximum | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Basis spread on variable rate | 3.25% | ||||||||||||
EEH Credit Agreement | New Credit Facility | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Current borrowing base under EEH credit agreement | $ 950,000,000 | ||||||||||||
Long-term debt outstanding | $ 391,700,000 | $ 391,700,000 | |||||||||||
Long-term debt, percentage bearing annual interest rate | 5.824% | 5.824% | |||||||||||
Averaged interest rate on borrowings | 4.75% | 4.29% | |||||||||||
Capitalized costs associated with borrowings | $ 3,600,000 | $ 15,200,000 | |||||||||||
8.000% Senior Notes Due 2027 | Senior Notes | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Debt instrument, face amount | $ 550,000,000 | ||||||||||||
Interest rate, stated percentage | 8% | 8% | 8% | ||||||||||
Decrease in principal amount | $ 500,000,000 | ||||||||||||
Capitalized costs associated with borrowings | $ 12,700,000 | $ 0 | $ 12,700,000 | $ 0 | |||||||||
Proceeds from issuance of debt, net | $ 537,200,000 | ||||||||||||
Interest payable | $ 20,700,000 | $ 20,700,000 | |||||||||||
8.000% Senior Notes Due 2027 | Senior Notes | Debt Instrument, Redemption, Period One | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Redemption price, percentage of principal amount redeemed | 100% | ||||||||||||
8.000% Senior Notes Due 2027 | Senior Notes | Debt Instrument, Redemption, Period Two | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Redemption price, percentage of principal amount redeemed | 35% | ||||||||||||
Debt Instrument, redemption price | 108% | ||||||||||||
Redemption price, percentage of principal amount outstanding | 65% |
Asset Retirement Obligations (D
Asset Retirement Obligations (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Asset Retirement Obligation, Roll Forward Analysis [Roll Forward] | ||||
Beginning asset retirement obligations | $ 15,866 | |||
Liabilities incurred | 342 | |||
Liabilities settled | (665) | |||
Acquisitions | 20,078 | |||
Accretion expense | $ 758 | $ 323 | 1,863 | $ 916 |
Divestitures | (1,087) | |||
Revision of estimates | 381 | |||
Ending asset retirement obligations | $ 36,778 | $ 36,778 |
Related Party Transactions (Det
Related Party Transactions (Details) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||||||
Nov. 02, 2022 | Oct. 11, 2022 USD ($) $ / shares shares | Oct. 10, 2022 | Apr. 14, 2022 USD ($) shares | Feb. 15, 2022 USD ($) shares | Jan. 30, 2022 USD ($) $ / shares shares | Jul. 20, 2021 USD ($) shares | Jun. 30, 2022 USD ($) | Jun. 30, 2021 USD ($) seller | Sep. 30, 2022 USD ($) | Jul. 06, 2022 shares | Mar. 31, 2022 USD ($) | |
Related Party Transaction [Line Items] | ||||||||||||
Deferred acquisition payment - Chisholm | $ | $ 70,000 | |||||||||||
Payments of stock issuance costs | $ | $ 200 | $ 674 | $ 674 | |||||||||
Subsequent Event | ||||||||||||
Related Party Transaction [Line Items] | ||||||||||||
Shares repurchased | $ | $ 43,700 | |||||||||||
Shares repurchased (in dollars per share) | $ / shares | $ 14.58 | |||||||||||
Securities Purchase Agreement | ||||||||||||
Related Party Transaction [Line Items] | ||||||||||||
Sale of stock, proceeds received on transaction | $ | $ 279,300 | $ 280,000 | ||||||||||
Eagle Ford Acquisitions | ||||||||||||
Related Party Transaction [Line Items] | ||||||||||||
Total consideration transferred | $ | $ 45,200 | |||||||||||
Number of separate sellers | seller | 4 | |||||||||||
Eagle Ford, Seller One | ||||||||||||
Related Party Transaction [Line Items] | ||||||||||||
Total consideration transferred | $ | $ 8,200 | |||||||||||
Class A Common Stock | ||||||||||||
Related Party Transaction [Line Items] | ||||||||||||
Convertible preferred stock, shares issued upon conversion (in shares) | shares | 25,225,225 | |||||||||||
Class A Common Stock | Subsequent Event | ||||||||||||
Related Party Transaction [Line Items] | ||||||||||||
Shares repurchased (in shares) | shares | 3,000,000 | |||||||||||
Class A Common Stock | Securities Purchase Agreement | ||||||||||||
Related Party Transaction [Line Items] | ||||||||||||
Sale of stock, price per share (in dollars per share) | $ / shares | $ 11.10 | |||||||||||
Class A Common Stock | Warburg Pincus LLC | Subsequent Event | Earthstone Energy, Inc. | ||||||||||||
Related Party Transaction [Line Items] | ||||||||||||
Sale of stock, number of shares issued in transaction (in shares) | shares | 3,750,000 | |||||||||||
Sale of stock, price per share (in dollars per share) | $ / shares | $ 14.58 | |||||||||||
Percentage of ownership before transaction | 18.70% | |||||||||||
Sale of stock, percentage of ownership after transaction | 12.30% | |||||||||||
Series A Convertible Preferred Stock | Securities Purchase Agreement | ||||||||||||
Related Party Transaction [Line Items] | ||||||||||||
Sale of stock, number of shares issued in transaction (in shares) | shares | 280,000 | 280,000 | ||||||||||
Sale of stock, price per share (in dollars per share) | $ / shares | $ 1,000 | |||||||||||
Series A Convertible Preferred Stock | Securities Purchase Agreement | En Cap And Affiliates | ||||||||||||
Related Party Transaction [Line Items] | ||||||||||||
Sale of stock, number of shares issued in transaction (in shares) | shares | 220,000 | |||||||||||
Series A Convertible Preferred Stock | Securities Purchase Agreement | Post Oak And Affiliates | ||||||||||||
Related Party Transaction [Line Items] | ||||||||||||
Sale of stock, number of shares issued in transaction (in shares) | shares | 60,000 | |||||||||||
Common Class A and Common Class B | Warburg Pincus LLC | Subsequent Event | Earthstone Energy, Inc. | ||||||||||||
Related Party Transaction [Line Items] | ||||||||||||
Percentage of ownership before transaction | 14.10% | |||||||||||
Sale of stock, percentage of ownership after transaction | 9.30% | |||||||||||
Chisholm Acquisition | ||||||||||||
Related Party Transaction [Line Items] | ||||||||||||
Cash consideration | $ | $ 383,938 | |||||||||||
Asset acquisition, ownership percentage before acquisition | 25% | |||||||||||
Asset acquisition, percentage of voting interest acquired | 36% | |||||||||||
Chisholm Acquisition | Class A Common Stock | ||||||||||||
Related Party Transaction [Line Items] | ||||||||||||
Shares of Class A Common Stock issued (in shares) | shares | 19,417,476 | |||||||||||
Tracker And Sequel Aquisitions | ||||||||||||
Related Party Transaction [Line Items] | ||||||||||||
Cash consideration | $ | $ 60,159 | |||||||||||
Tracker And Sequel Aquisitions | Class A Common Stock | ||||||||||||
Related Party Transaction [Line Items] | ||||||||||||
Shares of Class A Common Stock issued (in shares) | shares | 6,200,000 | |||||||||||
Tracker Purchase Agreement | ||||||||||||
Related Party Transaction [Line Items] | ||||||||||||
Cash consideration | $ | $ 18,800 | |||||||||||
Shares of Class A Common Stock issued (in shares) | shares | 4,700,000 | |||||||||||
Tracker Purchase Agreement | Significant Shareholder | ||||||||||||
Related Party Transaction [Line Items] | ||||||||||||
Asset acquisition, percentage of voting interest acquired | 49% | |||||||||||
Tracker Purchase Agreement | Class A Common Stock | ||||||||||||
Related Party Transaction [Line Items] | ||||||||||||
Shares of Class A Common Stock issued (in shares) | shares | 4,700,000 | |||||||||||
EEH Credit Agreement | Chisholm Acquisition | ||||||||||||
Related Party Transaction [Line Items] | ||||||||||||
Cash consideration | $ | $ 377,500 |
Commitments and Contingencies (
Commitments and Contingencies (Details) $ in Millions | Sep. 12, 2022 director | Sep. 30, 2022 USD ($) |
Commitments and Contingencies Disclosure [Abstract] | ||
Number of directors sued | director | 6 | |
Total number of directors | director | 10 | |
Purchase obligation, to be paid in 2023 | $ | $ 29.8 | |
Purchase obligation, to be paid in 2024 | $ | $ 6.9 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||
Feb. 15, 2022 | Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Income Tax Disclosure [Line Items] | ||||||
Accrued income taxes, current | $ 4,100 | $ 4,100 | $ 900 | |||
Income tax expense (benefit) | 60,518 | $ 451 | 81,673 | $ (343) | ||
Deferred income tax expense (benefit) | 77,591 | (343) | ||||
Valuation allowance | 6,500 | |||||
Domestic Tax Authority | ||||||
Income Tax Disclosure [Line Items] | ||||||
Accrued income taxes, current | 2,000 | 2,000 | ||||
State and Local Jurisdiction | ||||||
Income Tax Disclosure [Line Items] | ||||||
Income tax expense (benefit) | 6,200 | |||||
Deferred income tax expense (benefit) | 4,100 | |||||
Current income tax expense (benefit) | 2,100 | |||||
Texas Margin Tax | ||||||
Income Tax Disclosure [Line Items] | ||||||
Accrued income taxes, current | $ 2,100 | 2,100 | ||||
Income tax expense (benefit) | 600 | |||||
Earthstone Energy, Inc. | ||||||
Income Tax Disclosure [Line Items] | ||||||
Income tax expense (benefit) | 70,000 | |||||
Deferred income tax expense (benefit) | 74,500 | |||||
Earthstone Energy Holdings, LLC | ||||||
Income Tax Disclosure [Line Items] | ||||||
Income tax expense (benefit) | (800) | |||||
Current income tax expense (benefit) | 2,000 | |||||
Earthstone Energy Holdings, LLC | Texas Margin Tax | ||||||
Income Tax Disclosure [Line Items] | ||||||
Deferred income tax expense (benefit) | (800) | |||||
Lynden Corp | ||||||
Income Tax Disclosure [Line Items] | ||||||
Deferred income tax expense (benefit) | $ 5,500 | $ (100) | ||||
Chisholm Acquisition | Class A Common Stock | ||||||
Income Tax Disclosure [Line Items] | ||||||
EEH Units issued in connect with Acquisition (in shares) | 19,417,476 |