Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2019 | Apr. 29, 2019 | |
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Mar. 31, 2019 | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q1 | |
Trading Symbol | WTI | |
Entity Registrant Name | W&T OFFSHORE INC | |
Entity Central Index Key | 0001288403 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Common Stock, Shares Outstanding | 140,644,033 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Current assets: | ||
Cash and cash equivalents | $ 86,116 | $ 33,293 |
Receivables: | ||
Oil and natural gas sales | 41,308 | 47,804 |
Joint interest, net | 17,620 | 14,634 |
Income taxes | 54,076 | 54,076 |
Total receivables | 113,004 | 116,514 |
Prepaid expenses and other assets (Note 1) | 34,127 | 76,406 |
Total current assets | 233,247 | 226,213 |
Oil and natural gas properties and other, net - at cost (Note 1) | 514,765 | 515,421 |
Restricted deposits for asset retirement obligations | 15,498 | 15,685 |
Other assets (Note 1) | 79,005 | 91,547 |
Total assets | 842,515 | 848,866 |
Current liabilities: | ||
Accounts payable | 71,359 | 82,067 |
Undistributed oil and natural gas proceeds | 22,014 | 28,995 |
Advances from joint interest partners | 65,271 | 20,627 |
Asset retirement obligations | 24,799 | 24,994 |
Accrued liabilities (Note 1) | 35,197 | 29,611 |
Total current liabilities | 218,640 | 186,294 |
Long-term debt (Note 2) | 634,005 | 633,535 |
Asset retirement obligations, less current portion | 289,363 | 285,143 |
Other liabilities (Note 1) | 73,142 | 68,690 |
Commitments and contingencies (Note 10) | ||
Shareholders’ deficit: | ||
Preferred stock, $0.00001 par value; 20,000 shares authorized; 0 issued for both dates presented | ||
Common stock, $0.00001 par value; 200,000 shares authorized; 143,513 issued and 140,644 outstanding for both dates presented | 1 | 1 |
Additional paid-in capital | 545,627 | 545,705 |
Retained deficit | (894,096) | (846,335) |
Treasury stock, at cost; 2,869 shares for both dates presented | (24,167) | (24,167) |
Total shareholders' equity (deficit) | (372,635) | (324,796) |
Total liabilities and shareholders' equity (deficit) | $ 842,515 | $ 848,866 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Mar. 31, 2019 | Dec. 31, 2018 |
Statement Of Financial Position [Abstract] | ||
Preferred stock, par value | $ 0.00001 | $ 0.00001 |
Preferred stock, shares authorized | 20,000,000 | 20,000,000 |
Preferred stock, issued | 0 | 0 |
Common stock, par value | $ 0.00001 | $ 0.00001 |
Common stock, shares authorized | 200,000,000 | 200,000,000 |
Common stock, issued | 143,513,000 | 143,513,000 |
Common stock, outstanding | 140,644,000 | 140,644,000 |
Treasury stock, shares | 2,869,000 | 2,869,000 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Revenues: | ||
Total revenues | $ 116,080 | $ 134,213 |
Operating costs and expenses: | ||
Lease operating expenses | 43,456 | 36,843 |
Production taxes | 416 | 455 |
Depreciation, depletion, amortization and accretion | 33,766 | 38,081 |
General and administrative expenses | 14,109 | 15,038 |
Derivative loss | 48,886 | |
Total costs and expenses | 147,056 | 95,474 |
Operating (loss) income | (30,976) | 38,739 |
Interest expense, net | 16,282 | 10,962 |
Other expense, net | 331 | 28 |
(Loss) income before income tax expense | (47,589) | 27,749 |
Income tax expense | 172 | 109 |
Net (loss) income | $ (47,761) | $ 27,640 |
Basic and diluted (loss) earnings per common share | $ (0.34) | $ 0.19 |
Oil | ||
Revenues: | ||
Total revenues | $ 86,703 | $ 97,306 |
NGLs | ||
Revenues: | ||
Total revenues | 6,448 | 9,660 |
Natural gas | ||
Revenues: | ||
Total revenues | 21,838 | 25,867 |
Other | ||
Revenues: | ||
Total revenues | 1,091 | 1,380 |
Gathering and transportation | ||
Operating costs and expenses: | ||
Operating costs and expenses | $ 6,423 | $ 5,057 |
Condensed Consolidated Statem_2
Condensed Consolidated Statement of Changes in Shareholders' Deficit - USD ($) shares in Thousands, $ in Thousands | Total | Common Stock Outstanding | Additional Paid-In Capital | Retained Deficit | Treasury Stock |
Beginning Balances at Dec. 31, 2017 | $ (573,508) | $ 1 | $ 545,820 | $ (1,095,162) | $ (24,167) |
Beginning Balances (in shares) at Dec. 31, 2017 | 139,091 | 2,869 | |||
Share-based compensation | 1,219 | 1,219 | |||
Net income (loss) | 27,640 | 27,640 | |||
Ending Balances at Mar. 31, 2018 | (544,649) | $ 1 | 547,039 | (1,067,522) | $ (24,167) |
Ending Balances (in shares) at Mar. 31, 2018 | 139,091 | 2,869 | |||
Beginning Balances at Dec. 31, 2018 | (324,796) | $ 1 | 545,705 | (846,335) | $ (24,167) |
Beginning Balances (in shares) at Dec. 31, 2018 | 140,644 | 2,869 | |||
Share-based compensation | (78) | (78) | |||
Net income (loss) | (47,761) | (47,761) | |||
Ending Balances at Mar. 31, 2019 | $ (372,635) | $ 1 | $ 545,627 | $ (894,096) | $ (24,167) |
Ending Balances (in shares) at Mar. 31, 2019 | 140,644 | 2,869 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Operating activities: | ||
Net (loss) income | $ (47,761) | $ 27,640 |
Adjustments to reconcile net (loss) income to net cash provided by operating activities: | ||
Depreciation, depletion, amortization and accretion | 33,766 | 38,081 |
Amortization of debt items and other items | 1,152 | 466 |
Share-based compensation | (78) | 1,219 |
Derivative loss | 48,886 | |
Cash receipts on derivative settlements, net | 11,948 | |
Deferred income taxes | 172 | 109 |
Changes in operating assets and liabilities: | ||
Oil and natural gas receivables | 6,496 | 501 |
Joint interest receivables | (2,986) | 1,919 |
Prepaid expenses and other assets | (4,269) | (6,391) |
Asset retirement obligation settlements | (254) | (7,022) |
Cash advances from JV partners | 44,644 | 19,147 |
Accounts payable, accrued liabilities and other | (6,871) | (688) |
Net cash provided by operating activities | 84,845 | 74,981 |
Investing activities: | ||
Investment in oil and natural gas properties and equipment | (31,581) | (38,271) |
Deposit for acquisition | (3,000) | |
Net cash used in investing activities | (31,581) | (41,271) |
Financing activities: | ||
Debt issuance costs | (441) | |
Net cash used in financing activities | (441) | (2,057) |
Increase in cash and cash equivalents | 52,823 | 31,653 |
Cash and cash equivalents, beginning of period | 33,293 | 99,058 |
Cash and cash equivalents, end of period | $ 86,116 | 130,711 |
11.00% 1.5 Lien Term Loan, Due November 2019 | ||
Financing activities: | ||
Payment of interest | $ (2,057) |
Basis of Presentation
Basis of Presentation | 3 Months Ended |
Mar. 31, 2019 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation Operations. W&T Offshore, Inc. (with subsidiaries referred to herein as “W&T,” “we,” “us,” “our,” or the “Company”) is an independent oil and natural gas producer with substantially all of its operations offshore in the Gulf of Mexico. The Company is active in the exploration, development and acquisition of oil and natural gas properties. Our interests in fields, leases, structures and equipment are primarily owned by W&T Offshore, Inc. and its 100%-owned subsidiary, W & T Energy VI, LLC, and through our proportionately consolidated interest in Monza Energy LLC (“Monza”), as described in more detail in Note 4. Interim Financial Statements. The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim periods and the appropriate rules and regulations of the Securities and Exchange Commission (“SEC”). Accordingly, the condensed consolidated financial statements do not include all of the information and footnote disclosures required by GAAP for complete financial statements for annual periods. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for interim periods are not necessarily indicative of the results that may be expected for the entire year. These unaudited condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018. Use of Estimates. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates. Leases. In February 2016, Accounting Standards Update 2016-02, Leases ( Topic 842 ) (“ASU 2016-02”) was issued requiring an entity to recognize a right-of-use (“ROU”) asset and lease liability for all leases. The classification of leases as either a finance or operating lease determines the recognition, measurement and presentation of expenses. ASU 2016-02 also requires certain quantitative and qualitative disclosures about leasing arrangements. Leases acquired to explore for or extract oil or natural gas resources, including the right to explore for those natural resources and rights to use the land in which those natural resources are contained, are not within the scope of this standard’s update. ASU 2016-02 was effective for us in the first quarter of 2019 and we adopted the new standard using a modified retrospective approach, with the date of initial application on January 1, 2019. Consequently, upon transition, we recognized an ROU asset and a lease liability with no retained earnings impact. As provided for in subsequent accounting standards updates related to ASU 2016-02, we are applying the following practical expedients which provide elections to: • not apply the recognition requirements to short-term leases (a lease that at commencement date has a lease term of 12 months or less and does not contain a purchase option); • not reassess whether a contract contains a lease, lease classifications between operating and financing and accounting for initial direct costs related to leases; • not reassess certain land easements in existence prior to January 1, 2019; • use hindsight in determining the lease term and assessing impairment; and • not separate nonlease and lease components. Based on the results of our implementation process, we identified one operating lease in existence at January 1, 2019 subject to ASU 2016-02, which is our real estate lease for office space in Houston, Texas that terminates in December 2022. We identified no finance leases. Houston Office Lease. Minimum future lease payments due under the lease as of March 31, 2019 are as follows: 2019 - $1.1 million; 2020 - $1.6 million; 2021 - $1.6 million and 2022 - $1.6 million. Expense related to the Houston office lease for the three months ended March 31, 2019 and 2018 was $0.7 million each period. As of March 31, 2019, we recorded an ROU asset and a lease liability of $5.0 million using a discount rate of 9.75%. The discount rate (or incremental borrowing rate) was determined using the interest rate of recently issued debt instruments that were issued at par and for a similar term as the term of our lease for the office space in Houston. After the adoption of the new standard update, the amounts recorded within our Condensed Consolidated Balance Sheet are as follows (in thousands): March 31, 2019 ROU: Prepaid expenses and other current assets: $ 1,095 Other assets 3,856 Total ROU $ 4,951 Lease liability: Accrued liabilities $ 1,095 Other liabilities 3,856 Total lease liability $ 4,951 Lease incentives: Prepaid expenses and other current assets (contra-asset) $ (213 ) Other assets (contra-asset) (795 ) Total lease incentives $ (1,008 ) The adoption of the new standard did not impact our Condensed Consolidated Statements of Operations, Condensed Consolidated Statements of Cash Flows or Condensed Consolidated Statements of Changes in Shareholders’ Deficit. Revenue Recognition . We recognize revenue from the sale of crude oil, NGLs, and natural gas when our performance obligations are satisfied. Our contracts with customers are primarily short-term (less than 12 months). Our responsibilities to deliver a unit of crude oil, NGL, and natural gas under these contracts represent separate, distinct performance obligations. These performance obligations are satisfied at the point in time control of each unit is transferred to the customer. Pricing is primarily determined utilizing a particular pricing or market index, plus or minus adjustments reflecting quality or location differentials. Reclassifications. Certain reclassifications have been made to the prior period financial statements to conform to the current presentation as follows: In the Condensed Consolidated Statements of Operations, interest income was reclassified from Other expense, net to Interest expense, net , which did not change Net (loss) income before income tax expense . In the Condensed Consolidated Statements of Cash Flows, adjustments were made to certain line items within the Net Cash Used in Investing Activities of which did not change the total amount previous reported. The adjustments did not affect the Condensed Consolidated Balance Sheets Prepaid Expenses and Other Assets. The amounts recorded are expected to be realized within one year and the major categories are presented in the following table (in thousands): March 31, December 31, 2019 2018 Derivative assets (1) $ 16,959 $ 60,687 Unamortized bond/insurance premiums 4,944 5,197 Prepaid deposits related to royalties 8,871 8,872 Other 3,353 1,650 Prepaid expenses and other assets $ 34,127 $ 76,406 (1) Includes closed contracts which have not yet settled. Oil and Natural Gas Properties and Other, Net – at cost. March 31, December 31, 2019 2018 Oil and natural gas properties and equipment $ 8,198,394 $ 8,169,871 Furniture, fixtures and other 20,228 20,228 Total property and equipment 8,218,622 8,190,099 Less accumulated depreciation, depletion and amortization 7,703,857 7,674,678 Oil and natural gas properties and other, net $ 514,765 $ 515,421 Other Assets (long-term). The major categories are presented in the following table (in thousands) March 31, December 31, 2019 2018 Escrow deposit - Apache lawsuit $ 49,500 $ 49,500 Derivative assets 4,169 21,275 Appeal bond deposits 6,925 6,925 Unamortized debt issuance costs 4,511 4,773 Investment in White Cap, LLC 2,546 2,586 Unamortized brokerage fee for Monza 3,746 2,277 Proportional consolidation of Monza's other assets (Note 4) 3,299 3,275 Other 4,309 936 Total other assets (long-term) $ 79,005 $ 91,547 Accrued Liabilities. The major categories are presented in the following table (in thousands): March 31, December 31, 2019 2018 Accrued interest $ 27,624 $ 12,385 Accrued salaries/payroll taxes/benefits 2,425 2,320 Incentive compensation plans — 10,817 Litigation accruals 3,673 3,673 Other 1,475 416 Total accrued liabilities $ 35,197 $ 29,611 Other Liabilities (long-term). The major categories are presented in the following table (in thousands): March 31, December 31, 2019 2018 Apache lawsuit $ 49,500 $ 49,500 Uncertain tax positions including interest/penalties 11,694 11,523 Dispute related to royalty deductions 4,687 4,687 Dispute related to royalty-in-kind 2,164 2,135 Other 5,097 845 Total other liabilities (long-term) $ 73,142 $ 68,690 Recent Accounting Developments. In June 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update No. 2016-13, Financial Instruments – Credit Losses Topic 326 In August 2017, the FASB issued Accounting Standards Update No. 2017-12, Derivatives and Hedging (Topic 815) – Targeted Improvements to Accounting for Hedging Activities The SEC issued Final Rule Release No. 33-10532, Disclosure Update and Simplification Changes in Stockholders’ Equity and Noncontrolling Interests |
Long-Term Debt
Long-Term Debt | 3 Months Ended |
Mar. 31, 2019 | |
Debt Disclosure [Abstract] | |
Long-Term Debt | 2. Long-Term Debt The components of our long-term debt are presented in the following table (in thousands): March 31, December 31, 2019 2018 Credit Agreement (1) $ 21,000 $ 21,000 Senior Second Lien Notes: (1) Principal 625,000 625,000 Unamortized debt issuance costs (11,995 ) (12,465 ) Total Senior Second Lien Notes (1) 613,005 612,535 Total long-term debt $ 634,005 $ 633,535 (1) Defined below Credit Agreement On October 18, 2018, we entered into the Sixth Amended and Restated Credit Agreement (the “Credit Agreement”), which matures on October 18, 2022. The primary terms and covenants associated with the Credit Agreement are as follows, with capitalized terms defined under the Credit Agreement: • The borrowing base and lending commitment was $250.0 million as of the filing date of this Form 10-Q. • Letters of credit may be issued in amounts up to $30.0 million, provided availability under the Credit Agreement exists. As of March 31, 2019, and December 31, 2018, we had $8.1 million and $9.6 million, respectively, of letters of credit issued and outstanding under the Credit Agreement. • The Leverage Ratio is limited to 3.50 to 1.00 for March 31, 2019; 3.25 to 1.00 for quarters ending June 30, 2019 and September 30, 2019; and 3.00 to 1.00 for quarters ending December 31, 2019 and thereafter. In the event of a Material Acquisition, the Leverage Ratio limit is 3.50 to 1.00 for the two quarters following a Material Acquisition. • The Current Ratio must be maintained at greater than 1.00 to 1.00. Availability under the Credit Agreement is subject to semi-annual redeterminations of our borrowing base to occur on or before May 15 and November 14 each calendar year, and certain additional redeterminations that may be requested at the discretion of either the lenders or the Company. The borrowing base is calculated by our lenders based on their evaluation of our proved reserves and their own internal criteria. Any redetermination by our lenders to change our borrowing base will result in a similar change in the availability under the Credit Agreement. The Credit Agreement’s security is collateralized by a first priority lien on substantially all of our oil and natural gas properties and certain personal property. The interest rate on borrowings outstanding for the three months ended March 31, 2019 was 5.1%, which excludes debt issuance costs, commitment fees and other fees. 9.75% Senior Second Lien Notes Due 2023 On October 18, 2018, we issued $625.0 million of 9.75% Senior Second Lien Notes due 2023 (the “Senior Second Lien Notes”), which were issued at par with an interest rate of 9.75% per annum and mature on November 1, 2023, and are governed under the terms of the Indenture of the Senior Second Lien Notes (the “Indenture”). The estimated annual effective interest rate on the Senior Second Lien Notes is 10.3%, which includes amortization of debt issuance costs. Interest on the Senior Second Lien Notes is payable in arrears on May 1 and November 1 of each year, beginning on May 1, 2019. The Senior Second Lien Notes are secured by a second-priority lien on all of our assets that are secured under the Credit Agreement. The Senior Second Lien Notes contain covenants that limit or prohibit our ability and the ability of certain of our subsidiaries to: (i) make investments; (ii) incur additional indebtedness or issue certain types of preferred stock; (iii) create certain liens; (iv) sell assets; (v) enter into agreements that restrict dividends or other payments from the Company’s subsidiaries to the Company; (vi) consolidate, merge or transfer all or substantially all of the assets of the Company; (vii) engage in transactions with affiliates; (viii) pay dividends or make other distributions on capital stock or subordinated indebtedness; and (ix) create subsidiaries that would not be restricted by the covenants of the Indenture entered into by and among the Company, the Guarantors, and Wilmington Trust, National Association, as trustee (the “Trustee”). These covenants are subject to exceptions and qualifications set forth in the Indenture. In addition, most of the above described covenants will terminate if both S&P Global Ratings, a division of S&P Global Inc., and Moody’s Investors Service, Inc. assign the Senior Second Lien Notes an investment grade rating and no default exists with respect to the Senior Second Lien Notes. Covenants As of March 31, 2019, we were in compliance with all applicable covenants of the Credit Agreement and Senior Second Lien Notes indenture. Fair Value Measurements For information about fair value measurements of our long-term debt, refer to Note 3. |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Mar. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | 3. Fair Value Measurements Derivative Financial Instruments We measure the fair value of our open derivative financial instruments by applying the income approach, using models with inputs that are classified within Level 2 of the valuation hierarchy. The inputs used for the fair value measurement of our open derivative financial instruments are the exercise price, the expiration date, the settlement date, notional quantities, the implied volatility, the discount curve with spreads and published commodity future prices. Our open derivative financial instruments are reported in the Condensed Consolidated Balance Sheets using fair value. See Note 6, Derivative Financial Instruments The following table presents the fair value of our open derivative financial instruments (in thousands): March 31, December 31, 2019 2018 Assets: Derivatives instruments - open contracts $ 20,275 $ 74,580 Long-Term Debt We believe the carrying value of our debt under the Credit Agreement approximates fair value because the interest rates are variable and reflective of current market rates. The fair value of our Senior Second Lien Notes was measured based using quoted prices, although the market is not a very active market. The fair value of our long-term debt was classified as Level 2 within the valuation hierarchy. See Note 2, Long-Term Debt The following table presents the carrying value and fair value of our long-term debt (in thousands): March 31, 2019 December 31, 2018 Carrying Value Fair Value Carrying Value Fair Value Liabilities: Credit Agreement $ 21,000 $ 21,000 $ 21,000 $ 21,000 Senior Second Lien Notes 613,005 623,256 612,535 546,875 |
Joint Venture Drilling Program
Joint Venture Drilling Program | 3 Months Ended |
Mar. 31, 2019 | |
Oil And Gas Exploration And Production Industries Disclosures [Abstract] | |
Joint Venture Drilling Program | 4. Joint Venture Drilling Program On March 12, 2018, W&T and two other initial members formed and initially funded Monza, which jointly participates with us in the exploration, drilling and development of up to 14 identified drilling projects (the “JV Drilling Program”) in the Gulf of Mexico. The projects are expected to be completed during the years 2018 through 2020, but some projects may possibly extend into years beyond 2020. W&T initially contributed 88.94% of its working interest in 14 identified undeveloped drilling projects to Monza and retained 11.06% of its working interest. Subsequent to the initial closing, additional investors joined as members of Monza during 2018 and total commitments by all members, including W&T, are $361.4 million. The JV Drilling Program is structured so that we initially receive an aggregate of 30.0% of the revenues less expenses, through both our direct ownership of our working interest in the projects and our indirect interest through our interest in Monza, for contributing 20.0% of the estimated total well costs plus associated leases and providing access to available infrastructure at agreed upon rates. Any exceptions are approved by the Monza board. W&T is or will be the operator of each well in the JV Drilling Program unless there is a designated third-party operator. The members of Monza are made up of third-party investors, W&T and an entity owned and controlled by Mr. Tracy W. Krohn, our Chairman and Chief Executive Officer. The Krohn entity invested as a minority investor on the same terms and conditions as the third-party investors and its investment is limited to 4.5% of total invested capital within Monza. The entity affiliated with Mr. Krohn has made a capital commitment to Monza of $14.5 million. As of March 31, 2019, members of Monza made partner capital contribution payments to Monza totaling $184.9 million, of which $70.2 million was contributed during the three months ended March 31, 2019. Our net contribution to Monza, reduced by distributions received, as of March 31, 2019 was $58.9 million. W&T may be obligated to fund certain cost overruns, subject to certain exceptions, for the JV Drilling Program wells above budgeted and contingency amounts, of which the total exposure cannot be estimated at this time. Consolidation and Carrying Amounts. Oil and natural gas properties and other, net Other assets Oil and natural gas properties and other, net Other assets Total revenues Operating costs and expenses Additionally, during the three-months ended March 31, 2019, we received cash calls from Monza of $66.3 million, of which $65.2 million is included in the Condensed Consolidated Balance Sheet in Advances from joint interest partners |
Asset Retirement Obligations
Asset Retirement Obligations | 3 Months Ended |
Mar. 31, 2019 | |
Asset Retirement Obligation Disclosure [Abstract] | |
Asset Retirement Obligations | 5. Asset Retirement Obligations Our asset retirement obligations (“ARO”) represent the estimated present value of the amount incurred to plug, abandon and remediate our properties at the end of their productive lives. A summary of the changes to our ARO is as follows (in thousands): Balance, December 31, 2018 $ 310,137 Liabilities settled (254 ) Accretion of discount 4,588 Liabilities incurred 44 Revisions of estimated liabilities (353 ) Balance, March 31, 2019 314,162 Less current portion 24,799 Long-term $ 289,363 |
Derivative Financial Instrument
Derivative Financial Instruments | 3 Months Ended |
Mar. 31, 2019 | |
Derivative Instruments And Hedging Activities Disclosure [Abstract] | |
Derivative Financial Instruments | 6. Derivative Financial Instruments Our market risk exposure relates primarily to commodity prices and, from time to time, we use various derivative instruments to manage our exposure to this commodity price risk from sales of our crude oil and natural gas. All of the present derivative counterparties are also lenders or affiliates of lenders participating in our Credit Agreement. We are exposed to credit loss in the event of nonperformance by the derivative counterparties; however, we currently anticipate that each of our derivative counterparties will be able to fulfill their contractual obligations. We are not required to provide additional collateral to the derivative counterparties and we do not require collateral from our derivative counterparties. We have elected not to designate our commodity derivative contracts as hedging instruments; therefore, all changes in the fair value of derivative contracts were recognized currently in earnings during the periods presented. The cash flows of all of our commodity derivative contracts are included in Net cash provided by operating activities During 2018, we entered into commodity contracts for crude oil and natural gas which related to a portion of our expected future production. The crude oil contracts were based on West Texas Intermediate (“WTI”) crude oil prices as quoted off the New York Mercantile Exchange (“NYMEX”). The natural gas contracts are based on Henry Hub natural gas prices as quoted off the NYMEX. The open contracts as of March 31, 2019 are presented in the following tables: Crude Oil: Swap, Priced off WTI (NYMEX) Termination Period Notional Quantity (Bbls/day) (1) Notional Quantity (Bbls) (1) Strike Price May 2020 1,500 640,500 $ 60.80 May 2020 5,000 2,135,000 61.00 May 2020 3,500 1,494,500 60.85 (1) Bbls = Barrels Crude Oil: Calls - Bought, Priced off WTI (NYMEX) Termination Period Notional Quantity (Bbls/day) (1) Notional Quantity (Bbls) (1) Strike Price May 2020 10,000 4,270,000 $ 61.00 (1) Bbls = Barrels Natural Gas: Two-way collars, Priced off Henry Hub (NYMEX) Termination Period Notional Quantity (MMBtu/day) (1) Notional Quantity (MMBtu) (1) Put Option Strike Price (Bought) Call Option Strike Price (Sold) June 2019 50,000 3,050,000 $ 2.49 $ 3.975 (1) MMBtu – Million British Thermal Units The following amounts were recorded in the Condensed Consolidated Balance Sheets in the categories presented and include the fair value of open contracts, and closed contracts which had not yet settled (in thousands): March 31, December 31, 2019 2018 Prepaid expenses and other assets $ 16,959 $ 60,687 Other assets (non-current) 4,169 21,275 The amounts recorded on the Condensed Consolidated Balance Sheets are on a gross basis. If these were recorded on a net settlement basis, it would not have resulted in any differences in reported amounts. Changes in the fair value and settlements of our commodity derivative contracts were as follows (in thousands): Three Months Ended March 31, 2019 2018 Derivative loss $ 48,886 $ — Cash receipts on commodity derivative contract settlements, net, are included within Net cash provided by operating activities Three Months Ended March 31, 2019 2018 Cash receipts on derivative settlements, net $ 11,948 $ — |
Share-Based Compensation and Ca
Share-Based Compensation and Cash-Based Incentive Compensation | 3 Months Ended |
Mar. 31, 2019 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Share-Based Compensation and Cash-Based Incentive Compensation | 7. Share-Based Compensation and Cash-Based Incentive Compensation Awards to Employees. In 2010, the W&T Offshore, Inc. Amended and Restated Incentive Compensation Plan (as amended from time to time, the “Plan”) was approved by our shareholders. During 2018 and 2017, the Company granted restricted stock units (“RSUs”) under the Plan to certain of its employees. RSUs are a long-term compensation component, and are subject to satisfaction of certain predetermined performance criteria and adjustments at the end of the applicable performance period based on the results achieved. In addition to share-based awards, the Company may grant to its employees cash-based incentive awards under the Plan, which were used as a short-term and long-term compensation component of the 2018 awards, and were subject to satisfaction of certain predetermined performance criteria. As of March 31, 2019, there were 11,852,592 shares of common stock available for issuance in satisfaction of awards under the Plan. The shares available for issuance are reduced on a one-for-one basis when RSUs are settled in shares of common stock, which shares of common stock were issued net of withholding tax through the withholding of shares. The Company has the option following vesting to settle RSUs in stock or cash, or a combination of stock and cash. The Company expects to settle RSUs that vest in the future using shares of common stock. RSUs currently outstanding relate to the 2018 and 2017 grants, which were subject to predetermined performance criteria applied against the applicable performance period. These RSUs continue to be subject to employment-based criteria and vesting generally occurs in December of the second year after the grant. See the table below for anticipated vesting by year. We recognize compensation cost for share-based payments to employees over the period during which the recipient is required to provide service in exchange for the award. Compensation cost is based on the fair value of the equity instrument on the date of grant. The fair values for the RSUs granted during 2018 and 2017 were determined using the Company’s closing price on the grant date. We also estimate forfeitures, resulting in the recognition of compensation cost only for those awards that are expected to actually vest. All RSUs awarded are subject to forfeiture until vested and cannot be sold, transferred or otherwise disposed of during the restricted period. A summary of activity related to RSUs during the three months ended March 31, 2019 is as follows: Restricted Stock Units Weighted Average Grant Date Fair Units Value Per Unit Nonvested, December 31, 2018 3,355,917 $ 3.90 Forfeited (1) (856,718 ) 2.77 Nonvested, March 31, 2019 2,499,199 4.28 (1) Primarily related to a former executive’s forfeitures. For the outstanding RSUs issued to the eligible employees as of March 31, 2019, vesting is expected to occur as follows (subject to forfeitures): Restricted Stock Units 2019 1,579,140 2020 920,059 Total 2,499,199 Awards to Non-Employee Directors . Under the W&T Offshore, Inc. 2004 Directors Compensation Plan (as amended from time to time, the “Director Compensation Plan”), shares of restricted stock (“Restricted Shares”) have been granted to the Company’s non-employee directors. Grants to non-employee directors were made during 2018, 2017 and 2016. As of March 31, 2019, there were 128,980 shares of common stock available for issuance in satisfaction of awards under the Director Compensation Plan. The shares available are reduced on a one-to-one basis when Restricted Shares are granted. We recognize compensation cost for share-based payments to non-employee directors over the period during which the recipient is required to provide service in exchange for the award. Compensation cost is based on the fair value of the equity instrument on the date of grant. The fair values for the Restricted Shares granted were determined using the Company’s closing price on the grant date. No forfeitures were estimated for the non-employee directors’ awards. The Restricted Shares are subject to service conditions and vesting occurs at the end of specified service periods unless approved by the Board of Directors. Restricted Shares cannot be sold, transferred or disposed of during the restricted period. The holders of Restricted Shares generally have the same rights as a shareholder of the Company with respect to such Restricted Shares, including the right to vote and receive dividends or other distributions paid with respect to the Restricted Shares. For the outstanding Restricted Shares issued to the non-employee directors as of March 31, 2019, vesting is expected to occur as follows (subject to any forfeitures): Restricted Shares 2019 105,012 2020 62,972 2021 13,848 Total 181,832 Share-Based Compensation. Share-based compensation expense is recorded in the line General and administrative expense s in the Condensed Consolidated Statements of Operations. The tax benefit related to compensation expense recognized under share-based payment arrangements was not meaningful and was minimal due to adjustments in the valuation allowance. A summary of incentive compensation expense under share-based payment arrangements is as follows (in thousands): Three Months Ended March 31, 2019 2018 Share-based compensation expense from: Restricted stock units (1) $ (148 ) $ 1,149 Restricted Shares 70 70 Total $ (78 ) $ 1,219 (1) For the 2019 period, the net credit is due to a former executive’s forfeitures. Unrecognized Share-Based Compensation. As of March 31, 2019, unrecognized share-based compensation expense related to our awards of RSUs and Restricted Shares was $5.5 million and $0.3 million, respectively. Unrecognized share-based compensation expense will be recognized through November 2020 for RSUs and April 2021 for Restricted Shares. Cash-Based Incentive Compensation. In addition to share-based awards, cash-based awards were granted under the Plan to eligible employees in 2018 and 2017. For 2018, there were two cash-based awards consisting of a long-term award and a short-term award. All cash-based awards are performance-based awards consisting of predetermined performance criteria applied against the applicable performance period. Expense for each award is recognized over the service period once the applicable financial condition is expected to be met, and the business criteria and individual performance criteria can be reasonably estimated for the applicable period. • For the 2018 long-term, cash-based awards, incentive compensation expense was determined based on the Company achieving certain performance metrics for 2018 and is being recognized over the September 2018 to November 2020 period. The 2018 long-term, cash-based awards will be eligible for payment on December 14, 2020 subject to participants meeting certain employment-based criteria. • For the 2018 short-term, cash-based awards, incentive compensation expense was determined based on the Company achieving certain performance metrics for 2018 combined with individual performance criteria for 2018 and was recognized over the January 2018 to February 2019 period. The 2018 short-term, cash-based awards were paid during March 2019. • For the 2017 cash-based awards, incentive compensation expense was determined based on the Company achieving certain performance metrics for 2017 combined with individual performance criteria for 2017 and was recognized over the January 2017 to February 2018 period. The 2017 cash-based awards were paid during March 2018. A summary of compensation expense related to share-based awards and cash-based awards is as follows (in thousands): Three Months Ended March 31, 2019 2018 Share-based compensation included in: General and administrative expenses $ (78 ) $ 1,219 Cash-based incentive compensation included in: Lease operating expense (1) (123 ) 860 General and administrative expenses (1) 2,095 2,672 Total charged to operating income $ 1,894 $ 4,751 (1) Includes adjustments of accruals to actual payments. |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 8. Income Taxes Our income tax expense for the three months ended March 31, 2019 and 2018 was $0.2 million and $0.1 million, respectively. Our effective tax rate was not meaningful for the periods presented as we continue to record a full valuation allowance on net deferred tax assets. During the three months ended March 31, 2019 and 2018, we did not receive any income tax refunds or make any income tax payments of significance. As of March 31, 2019 and December 31, 2018, our valuation allowance was $127.8 million and $117.8 million, respectively, related to net federal and state deferred tax assets. Net deferred tax assets were recorded related to net operating losses and temporary differences between the book and tax basis of assets and liabilities expected to produce tax deductions in future periods. The realization of these assets depends on recognition of sufficient future taxable income in specific tax jurisdictions in which those temporary differences or net operating losses are deductible. As of March 31, 2019 and December 31, 2018, we had current income taxes receivable of $54.1 million, which primarily relates to our net operating loss carryback claims for the years 2012, 2013 and 2014 that were carried back to prior years. These carryback claims were made pursuant to IRC Section 172(f) , which permits certain platform dismantlement, well abandonment and site clearance costs to be carried back 10 years. The refund claims require a review by the Congressional Joint Committee on Taxation which we expect to receive in 2019. The tax years 2013 through 2018 remain open to examination by the tax jurisdictions to which we are subject. |
Earnings Per Share
Earnings Per Share | 3 Months Ended |
Mar. 31, 2019 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | 9. Earnings Per Share The following table presents the calculation of basic and diluted (loss) earnings per common share (in thousands, except per share amounts): Three Months Ended March 31, 2019 2018 Net (loss) income $ (47,761 ) $ 27,640 Less portion allocated to nonvested shares — 1,145 Net (loss) income allocated to common shares $ (47,761 ) $ 26,495 Weighted average common shares outstanding 140,462 138,845 Basic and diluted (loss) earnings per common share $ (0.34 ) $ 0.19 Shares excluded due to being anti-dilutive (weighted-average) 3,342 — |
Contingencies
Contingencies | 3 Months Ended |
Mar. 31, 2019 | |
Commitments And Contingencies Disclosure [Abstract] | |
Contingencies | 10. Contingencies Apache Lawsuit. On December 15, 2014, Apache filed a lawsuit against the Company alleging that W&T breached the joint operating agreement related to, among other things, the abandonment of three deepwater wells in the Mississippi Canyon area of the Gulf of Mexico. A trial court judgment was rendered from the U.S. District Court for the Southern District of Texas on May 31, 2017 directing the Company to pay Apache $43.2 million, plus $6.3 million in prejudgment interest, attorney’s fees and costs assessed in the judgment. We filed an appeal of the trial court judgment in the U.S. Court of Appeals for the Fifth Circuit and provided oral arguments in December 2018. Prior to filing the appeal, in order to stay execution of the judgment, we deposited $49.5 million with the registry of the court in June 2017. Oral arguments occurred on December 4, 2018, but as the filing date of this Form 10-Q, a decision had not been rendered by the U.S. Court of Appeals for the Fifth Circuit. The deposit of $49.5 million with the registry of the court is recorded in Other assets ( Other liabilities Appeal with the Office of Natural Resources Revenue (“ONRR”). In 2009, we recognized allowable reductions of cash payments for royalties owed to the ONRR for transportation of their deepwater production through our subsea pipeline systems. In 2010, the ONRR audited our calculations and support related to this usage fee, and in 2010, we were notified that the ONRR had disallowed approximately $4.7 million of the reductions taken. We recorded a reduction to other revenue in 2010 to reflect this disallowance; however, we disagree with the position taken by the ONRR. We filed an appeal with the ONRR, which was denied in May 2014. On June 17, 2014, we filed an appeal with the Interior Board of Land Appeals (“IBLA”) under the Department of the Interior. On January 27, 2017, the IBLA affirmed the decision of the ONRR requiring W&T to pay approximately $4.7 million in additional royalties. We filed a motion for reconsideration of the IBLA decision on March 27, 2017. Based on a statutory deadline, we filed an appeal of the IBLA decision on July 25, 2017 in the U.S. District Court for the Eastern District of Louisiana. We were required to post a bond in the amount of $7.2 million and cash collateral of $6.9 million in order to appeal the IBLA decision. On December 4, 2018, the IBLA denied our motion for reconsideration. On February 4, 2019, we filed our first amended complaint. Royalties-In-Kind (“RIK”). Under a program of the Minerals Management Service (“MMS”) (a Department of Interior agency and predecessor to the ONRR), royalties must be paid “in-kind” rather than in value from federal leases in the program. The MMS added to the RIK program our lease at the East Cameron 373 field beginning in November 2001, where in some months we over delivered volumes of natural gas and under delivered volumes of natural gas in other months for royalties owed. The MMS elected to terminate receiving royalties in-kind in October 2008, causing the imbalance to become fixed for accounting purposes. The MMS ordered us to pay an amount based on its interpretation of the program and its calculations of amounts owed. We disagreed with MMS’s interpretations and calculations and filed an appeal with the IBLA, of which the IBLA ruled in MMS’ favor. We filed an appeal with the District Court of the Western District of Louisiana, who assigned the case to a magistrate to review and issue a ruling, and the District Court upheld the magistrate’s ruling on May 29, 2018. We filed an appeal on July 24, 2018. Part of the ruling was in favor of our position and part was in favor of MMS’ position. Based solely on the District Court’s ruling, we recorded a liability reserve of $2.2 million and $2.1 million as of March 31, 2019 and December 31, 2018, respectively. We have appealed the ruling to the U.S. Fifth Circuit Court of Appeals and the government filed a cross-appeal. Briefing and oral arguments, if held, are expected to be completed in 2019 Royalties – “Unbundling” Initiative. The ONRR has publicly announced an “unbundling” initiative to revise the methodology employed by producers in determining the appropriate allowances for transportation and processing costs that are permitted to be deducted in determining royalties under Federal oil and gas leases. The ONRR’s initiative requires re-computing allowable transportation and processing costs using revised guidance from the ONRR going back 84 months for every gas processing plant that processed our gas. In the second quarter of 2015, pursuant to the initiative, we received requests from the ONRR for additional data regarding our transportation and processing allowances on natural gas production related to a specific processing plant. We also received a preliminary determination notice from the ONRR asserting that our allocation of certain processing costs and plant fuel use at another processing plant was not allowed as deductions in the determination of royalties owed under Federal oil and gas leases. We have submitted revised calculations covering certain plants and time periods to the ONRR. As of the filing date of this Form 10-Q, we have not received a response from the ONRR related to our submissions. These open ONRR unbundling reviews, and any further similar reviews, could ultimately result in an order for payment of additional royalties under our Federal oil and gas leases for current and prior periods. For the three months ended March 31, 2019 and 2018, we paid $0.1 million and $0.1 million, respectively, of additional royalties and expect to pay more in the future. We are not able to determine the range of any additional royalties or, if and when assessed, whether such amounts would be material. Notices of Proposed Civil Penalty Assessment. During the three months ended March 31, 2019 and 2018, we did not pay any civil penalties to the Bureau of Safety and Environmental Enforcement (“BSEE”) related to Incidents of Noncompliance (“INCs”) at various offshore locations. We currently have nine open civil penalties issued by the BSEE from INCs, which have not been settled as of the filing date of this Form 10-Q. The INCs underlying these open civil penalties cite alleged non-compliance with various safety-related requirements and procedures occurring at separate offshore locations on various dates ranging from July 2012 to January 2018. The proposed civil penalties for these INCs total $7.7 million. As of March 31, 2019 and December 31, 2018, we have accrued approximately $3.4 million, which is our best estimate of the final settlements once all appeals have been exhausted. Our position is that the proposed civil penalties are excessive given the specific facts and circumstances related to these INCs. Other Claims. We are a party to various pending or threatened claims and complaints seeking damages or other remedies concerning our commercial operations and other matters in the ordinary course of our business. In addition, claims or contingencies may arise related to matters occurring prior to our acquisition of properties or related to matters occurring subsequent to our sale of properties. In certain cases, we have indemnified the sellers of properties we have acquired, and in other cases, we have indemnified the buyers of properties we have sold. We are also subject to federal and state administrative proceedings conducted in the ordinary course of business including matters related to alleged royalty underpayments on certain federal-owned properties. Although we can give no assurance about the outcome of pending legal and federal or state administrative proceedings and the effect such an outcome may have on us, we believe that any ultimate liability resulting from the outcome of such proceedings, to the extent not otherwise provided for or covered by insurance, will not have a material adverse effect on our consolidated financial position, results of operations or liquidity. |
Basis of Presentation (Policies
Basis of Presentation (Policies) | 3 Months Ended |
Mar. 31, 2019 | |
Accounting Policies [Abstract] | |
Operations | Operations. W&T Offshore, Inc. (with subsidiaries referred to herein as “W&T,” “we,” “us,” “our,” or the “Company”) is an independent oil and natural gas producer with substantially all of its operations offshore in the Gulf of Mexico. The Company is active in the exploration, development and acquisition of oil and natural gas properties. Our interests in fields, leases, structures and equipment are primarily owned by W&T Offshore, Inc. and its 100%-owned subsidiary, W & T Energy VI, LLC, and through our proportionately consolidated interest in Monza Energy LLC (“Monza”), as described in more detail in Note 4. |
Interim Financial Statements | Interim Financial Statements. The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim periods and the appropriate rules and regulations of the Securities and Exchange Commission (“SEC”). Accordingly, the condensed consolidated financial statements do not include all of the information and footnote disclosures required by GAAP for complete financial statements for annual periods. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for interim periods are not necessarily indicative of the results that may be expected for the entire year. These unaudited condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018. |
Use of Estimates | Use of Estimates. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates. |
Leases | Leases. In February 2016, Accounting Standards Update 2016-02, Leases ( Topic 842 ) (“ASU 2016-02”) was issued requiring an entity to recognize a right-of-use (“ROU”) asset and lease liability for all leases. The classification of leases as either a finance or operating lease determines the recognition, measurement and presentation of expenses. ASU 2016-02 also requires certain quantitative and qualitative disclosures about leasing arrangements. Leases acquired to explore for or extract oil or natural gas resources, including the right to explore for those natural resources and rights to use the land in which those natural resources are contained, are not within the scope of this standard’s update. ASU 2016-02 was effective for us in the first quarter of 2019 and we adopted the new standard using a modified retrospective approach, with the date of initial application on January 1, 2019. Consequently, upon transition, we recognized an ROU asset and a lease liability with no retained earnings impact. As provided for in subsequent accounting standards updates related to ASU 2016-02, we are applying the following practical expedients which provide elections to: • not apply the recognition requirements to short-term leases (a lease that at commencement date has a lease term of 12 months or less and does not contain a purchase option); • not reassess whether a contract contains a lease, lease classifications between operating and financing and accounting for initial direct costs related to leases; • not reassess certain land easements in existence prior to January 1, 2019; • use hindsight in determining the lease term and assessing impairment; and • not separate nonlease and lease components. Based on the results of our implementation process, we identified one operating lease in existence at January 1, 2019 subject to ASU 2016-02, which is our real estate lease for office space in Houston, Texas that terminates in December 2022. We identified no finance leases. Houston Office Lease. Minimum future lease payments due under the lease as of March 31, 2019 are as follows: 2019 - $1.1 million; 2020 - $1.6 million; 2021 - $1.6 million and 2022 - $1.6 million. Expense related to the Houston office lease for the three months ended March 31, 2019 and 2018 was $0.7 million each period. As of March 31, 2019, we recorded an ROU asset and a lease liability of $5.0 million using a discount rate of 9.75%. The discount rate (or incremental borrowing rate) was determined using the interest rate of recently issued debt instruments that were issued at par and for a similar term as the term of our lease for the office space in Houston. After the adoption of the new standard update, the amounts recorded within our Condensed Consolidated Balance Sheet are as follows (in thousands): March 31, 2019 ROU: Prepaid expenses and other current assets: $ 1,095 Other assets 3,856 Total ROU $ 4,951 Lease liability: Accrued liabilities $ 1,095 Other liabilities 3,856 Total lease liability $ 4,951 Lease incentives: Prepaid expenses and other current assets (contra-asset) $ (213 ) Other assets (contra-asset) (795 ) Total lease incentives $ (1,008 ) The adoption of the new standard did not impact our Condensed Consolidated Statements of Operations, Condensed Consolidated Statements of Cash Flows or Condensed Consolidated Statements of Changes in Shareholders’ Deficit. |
Revenue Recognition | Revenue Recognition . We recognize revenue from the sale of crude oil, NGLs, and natural gas when our performance obligations are satisfied. Our contracts with customers are primarily short-term (less than 12 months). Our responsibilities to deliver a unit of crude oil, NGL, and natural gas under these contracts represent separate, distinct performance obligations. These performance obligations are satisfied at the point in time control of each unit is transferred to the customer. Pricing is primarily determined utilizing a particular pricing or market index, plus or minus adjustments reflecting quality or location differentials. |
Reclassification | Reclassifications. Certain reclassifications have been made to the prior period financial statements to conform to the current presentation as follows: In the Condensed Consolidated Statements of Operations, interest income was reclassified from Other expense, net to Interest expense, net , which did not change Net (loss) income before income tax expense . In the Condensed Consolidated Statements of Cash Flows, adjustments were made to certain line items within the Net Cash Used in Investing Activities of which did not change the total amount previous reported. The adjustments did not affect the Condensed Consolidated Balance Sheets |
Prepaid Expenses and Other Assets | Prepaid Expenses and Other Assets. The amounts recorded are expected to be realized within one year and the major categories are presented in the following table (in thousands): March 31, December 31, 2019 2018 Derivative assets (1) $ 16,959 $ 60,687 Unamortized bond/insurance premiums 4,944 5,197 Prepaid deposits related to royalties 8,871 8,872 Other 3,353 1,650 Prepaid expenses and other assets $ 34,127 $ 76,406 (1) Includes closed contracts which have not yet settled. |
Oil and Natural Gas Properties and Other, Net - at Cost | Oil and Natural Gas Properties and Other, Net – at cost. March 31, December 31, 2019 2018 Oil and natural gas properties and equipment $ 8,198,394 $ 8,169,871 Furniture, fixtures and other 20,228 20,228 Total property and equipment 8,218,622 8,190,099 Less accumulated depreciation, depletion and amortization 7,703,857 7,674,678 Oil and natural gas properties and other, net $ 514,765 $ 515,421 |
Other Assets (Long-term) | Other Assets (long-term). The major categories are presented in the following table (in thousands) March 31, December 31, 2019 2018 Escrow deposit - Apache lawsuit $ 49,500 $ 49,500 Derivative assets 4,169 21,275 Appeal bond deposits 6,925 6,925 Unamortized debt issuance costs 4,511 4,773 Investment in White Cap, LLC 2,546 2,586 Unamortized brokerage fee for Monza 3,746 2,277 Proportional consolidation of Monza's other assets (Note 4) 3,299 3,275 Other 4,309 936 Total other assets (long-term) $ 79,005 $ 91,547 |
Accrued Liabilities | Accrued Liabilities. The major categories are presented in the following table (in thousands): March 31, December 31, 2019 2018 Accrued interest $ 27,624 $ 12,385 Accrued salaries/payroll taxes/benefits 2,425 2,320 Incentive compensation plans — 10,817 Litigation accruals 3,673 3,673 Other 1,475 416 Total accrued liabilities $ 35,197 $ 29,611 |
Other Liabilities (Long-term) | Other Liabilities (long-term). The major categories are presented in the following table (in thousands): March 31, December 31, 2019 2018 Apache lawsuit $ 49,500 $ 49,500 Uncertain tax positions including interest/penalties 11,694 11,523 Dispute related to royalty deductions 4,687 4,687 Dispute related to royalty-in-kind 2,164 2,135 Other 5,097 845 Total other liabilities (long-term) $ 73,142 $ 68,690 |
Recent Accounting Developments | Recent Accounting Developments. In June 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update No. 2016-13, Financial Instruments – Credit Losses Topic 326 In August 2017, the FASB issued Accounting Standards Update No. 2017-12, Derivatives and Hedging (Topic 815) – Targeted Improvements to Accounting for Hedging Activities The SEC issued Final Rule Release No. 33-10532, Disclosure Update and Simplification Changes in Stockholders’ Equity and Noncontrolling Interests |
Basis of Presentation (Tables)
Basis of Presentation (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Schedule of Amounts Recorded in Prepaid Expenses and Other Assets | The amounts recorded are expected to be realized within one year and the major categories are presented in the following table (in thousands): March 31, December 31, 2019 2018 Derivative assets (1) $ 16,959 $ 60,687 Unamortized bond/insurance premiums 4,944 5,197 Prepaid deposits related to royalties 8,871 8,872 Other 3,353 1,650 Prepaid expenses and other assets $ 34,127 $ 76,406 (1) Includes closed contracts which have not yet settled. |
Schedule of Oil and Natural Gas Properties and Other, Net at Cost | Oil and natural gas properties and equipment are recorded at cost using the full cost method. There were no amounts excluded from amortization as of the dates presented in the following table (in thousands): March 31, December 31, 2019 2018 Oil and natural gas properties and equipment $ 8,198,394 $ 8,169,871 Furniture, fixtures and other 20,228 20,228 Total property and equipment 8,218,622 8,190,099 Less accumulated depreciation, depletion and amortization 7,703,857 7,674,678 Oil and natural gas properties and other, net $ 514,765 $ 515,421 |
Schedule of Other Assets (Long-term) | The major categories are presented in the following table (in thousands) March 31, December 31, 2019 2018 Escrow deposit - Apache lawsuit $ 49,500 $ 49,500 Derivative assets 4,169 21,275 Appeal bond deposits 6,925 6,925 Unamortized debt issuance costs 4,511 4,773 Investment in White Cap, LLC 2,546 2,586 Unamortized brokerage fee for Monza 3,746 2,277 Proportional consolidation of Monza's other assets (Note 4) 3,299 3,275 Other 4,309 936 Total other assets (long-term) $ 79,005 $ 91,547 |
Schedule of Accrued Liabilities | The major categories are presented in the following table (in thousands): March 31, December 31, 2019 2018 Accrued interest $ 27,624 $ 12,385 Accrued salaries/payroll taxes/benefits 2,425 2,320 Incentive compensation plans — 10,817 Litigation accruals 3,673 3,673 Other 1,475 416 Total accrued liabilities $ 35,197 $ 29,611 |
Schedule of Other Liabilities (Long-term) | The major categories are presented in the following table (in thousands): March 31, December 31, 2019 2018 Apache lawsuit $ 49,500 $ 49,500 Uncertain tax positions including interest/penalties 11,694 11,523 Dispute related to royalty deductions 4,687 4,687 Dispute related to royalty-in-kind 2,164 2,135 Other 5,097 845 Total other liabilities (long-term) $ 73,142 $ 68,690 |
ASU 2016-02 | |
Schedule of Amounts Recorded in Condensed Consolidated Balance Sheet after Adoption of New Standard Update | After the adoption of the new standard update, the amounts recorded within our Condensed Consolidated Balance Sheet are as follows (in thousands): March 31, 2019 ROU: Prepaid expenses and other current assets: $ 1,095 Other assets 3,856 Total ROU $ 4,951 Lease liability: Accrued liabilities $ 1,095 Other liabilities 3,856 Total lease liability $ 4,951 Lease incentives: Prepaid expenses and other current assets (contra-asset) $ (213 ) Other assets (contra-asset) (795 ) Total lease incentives $ (1,008 ) |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Debt Disclosure [Abstract] | |
Long-Term Debt | The components of our long-term debt are presented in the following table (in thousands): March 31, December 31, 2019 2018 Credit Agreement (1) $ 21,000 $ 21,000 Senior Second Lien Notes: (1) Principal 625,000 625,000 Unamortized debt issuance costs (11,995 ) (12,465 ) Total Senior Second Lien Notes (1) 613,005 612,535 Total long-term debt $ 634,005 $ 633,535 (1) Defined below |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
Schedule of Open Derivative Financial Instruments | The following table presents the fair value of our open derivative financial instruments (in thousands): March 31, December 31, 2019 2018 Assets: Derivatives instruments - open contracts $ 20,275 $ 74,580 |
Schedule of Carrying Value and Fair Value of Long-Term Debt | The following table presents the carrying value and fair value of our long-term debt (in thousands): March 31, 2019 December 31, 2018 Carrying Value Fair Value Carrying Value Fair Value Liabilities: Credit Agreement $ 21,000 $ 21,000 $ 21,000 $ 21,000 Senior Second Lien Notes 613,005 623,256 612,535 546,875 |
Asset Retirement Obligations (T
Asset Retirement Obligations (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Asset Retirement Obligation Disclosure [Abstract] | |
Summary of Changes to Asset Retirement Obligation | A summary of the changes to our ARO is as follows (in thousands): Balance, December 31, 2018 $ 310,137 Liabilities settled (254 ) Accretion of discount 4,588 Liabilities incurred 44 Revisions of estimated liabilities (353 ) Balance, March 31, 2019 314,162 Less current portion 24,799 Long-term $ 289,363 |
Derivative Financial Instrume_2
Derivative Financial Instruments (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Derivative Instruments And Hedging Activities Disclosure [Abstract] | |
Summary of Open Commodity Derivative Contracts | The open contracts as of March 31, 2019 are presented in the following tables: Crude Oil: Swap, Priced off WTI (NYMEX) Termination Period Notional Quantity (Bbls/day) (1) Notional Quantity (Bbls) (1) Strike Price May 2020 1,500 640,500 $ 60.80 May 2020 5,000 2,135,000 61.00 May 2020 3,500 1,494,500 60.85 (1) Bbls = Barrels Crude Oil: Calls - Bought, Priced off WTI (NYMEX) Termination Period Notional Quantity (Bbls/day) (1) Notional Quantity (Bbls) (1) Strike Price May 2020 10,000 4,270,000 $ 61.00 (1) Bbls = Barrels Natural Gas: Two-way collars, Priced off Henry Hub (NYMEX) Termination Period Notional Quantity (MMBtu/day) (1) Notional Quantity (MMBtu) (1) Put Option Strike Price (Bought) Call Option Strike Price (Sold) June 2019 50,000 3,050,000 $ 2.49 $ 3.975 (1) MMBtu – Million British Thermal Units |
Summary of Open Contracts and Closed Contracts (Not Yet Settled) Commodity Derivative Contracts | The following amounts were recorded in the Condensed Consolidated Balance Sheets in the categories presented and include the fair value of open contracts, and closed contracts which had not yet settled (in thousands): March 31, December 31, 2019 2018 Prepaid expenses and other assets $ 16,959 $ 60,687 Other assets (non-current) 4,169 21,275 |
Changes in Fair Value and Settlements of Commodity Derivative Contracts | Changes in the fair value and settlements of our commodity derivative contracts were as follows (in thousands): Three Months Ended March 31, 2019 2018 Derivative loss $ 48,886 $ — |
Cash Receipts on Derivative Settlements Included Within Net Cash Provided By Operating Activities | Cash receipts on commodity derivative contract settlements, net, are included within Net cash provided by operating activities Three Months Ended March 31, 2019 2018 Cash receipts on derivative settlements, net $ 11,948 $ — |
Share-Based Compensation and _2
Share-Based Compensation and Cash-Based Incentive Compensation (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Summary of Share Activity Related to Restricted Stock Units | A summary of activity related to RSUs during the three months ended March 31, 2019 is as follows: Restricted Stock Units Weighted Average Grant Date Fair Units Value Per Unit Nonvested, December 31, 2018 3,355,917 $ 3.90 Forfeited (1) (856,718 ) 2.77 Nonvested, March 31, 2019 2,499,199 4.28 (1) Primarily related to a former executive’s forfeitures. |
Schedule of Outstanding Restricted Stock Units Issued to Eligible Employees | For the outstanding RSUs issued to the eligible employees as of March 31, 2019, vesting is expected to occur as follows (subject to forfeitures): Restricted Stock Units 2019 1,579,140 2020 920,059 Total 2,499,199 |
Schedule of Outstanding Restricted Stock Shares Issued to Non-employee Directors | For the outstanding Restricted Shares issued to the non-employee directors as of March 31, 2019, vesting is expected to occur as follows (subject to any forfeitures): Restricted Shares 2019 105,012 2020 62,972 2021 13,848 Total 181,832 |
Summary of Incentive Compensation Expense under Share-Based Payment Arrangements | A summary of incentive compensation expense under share-based payment arrangements is as follows (in thousands): Three Months Ended March 31, 2019 2018 Share-based compensation expense from: Restricted stock units (1) $ (148 ) $ 1,149 Restricted Shares 70 70 Total $ (78 ) $ 1,219 (1) For the 2019 period, the net credit is due to a former executive’s forfeitures. |
Summary of Compensation Expense Related to Share-Based Awards and Cash-Based Awards | A summary of compensation expense related to share-based awards and cash-based awards is as follows (in thousands): Three Months Ended March 31, 2019 2018 Share-based compensation included in: General and administrative expenses $ (78 ) $ 1,219 Cash-based incentive compensation included in: Lease operating expense (1) (123 ) 860 General and administrative expenses (1) 2,095 2,672 Total charged to operating income $ 1,894 $ 4,751 (1) Includes adjustments of accruals to actual payments. |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Earnings Per Share [Abstract] | |
Schedule of Calculation of Basic and Diluted (Loss) Earnings Per Common Share | The following table presents the calculation of basic and diluted (loss) earnings per common share (in thousands, except per share amounts): Three Months Ended March 31, 2019 2018 Net (loss) income $ (47,761 ) $ 27,640 Less portion allocated to nonvested shares — 1,145 Net (loss) income allocated to common shares $ (47,761 ) $ 26,495 Weighted average common shares outstanding 140,462 138,845 Basic and diluted (loss) earnings per common share $ (0.34 ) $ 0.19 Shares excluded due to being anti-dilutive (weighted-average) 3,342 — |
Basis of Presentation - Additio
Basis of Presentation - Additional Information (Details) - USD ($) | 3 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | Dec. 31, 2018 | |
Basis Of Presentation [Line Items] | |||
Lease operating expenses | $ 43,456,000 | $ 36,843,000 | |
Operating lease liability | 4,951,000 | ||
Operating lease, right-of-use asset | 4,951,000 | ||
Oil and natural gas properties and equipment - full cost method, amount excluded from amortization | 0 | $ 0 | |
ASU 2016-02 | |||
Basis Of Presentation [Line Items] | |||
Minimum future lease payment, 2019 | 1,100,000 | ||
Minimum future lease payment, 2020 | 1,600,000 | ||
Minimum future lease payment, 2021 | 1,600,000 | ||
Minimum future lease payment, 2022 | 1,600,000 | ||
Operating lease liability | 5,000,000 | ||
Operating lease, right-of-use asset | $ 5,000,000 | ||
Operating lease, discount rate | 9.75% | ||
Office Space | ASU 2016-02 | |||
Basis Of Presentation [Line Items] | |||
Lease operating expenses | $ 700,000 | $ 700,000 |
Basis of Presentation - Schedul
Basis of Presentation - Schedule of Amounts Recorded in Condensed Consolidated Balance Sheet after Adoption of New Standard Update (Details) $ in Thousands | Mar. 31, 2019USD ($) |
Total ROU | $ 4,951 |
Total lease liability | 4,951 |
Total lease incentives | (1,008) |
Prepaid Expenses and Other Current Assets | |
Total ROU | 1,095 |
Total lease incentives | (213) |
Other Assets | |
Total ROU | 3,856 |
Total lease incentives | (795) |
Accrued Liabilities | |
Total lease liability | 1,095 |
Other Liabilities | |
Total lease liability | $ 3,856 |
Basis of Presentation - Sched_2
Basis of Presentation - Schedule of Amounts Recorded in Prepaid Expenses and Other Assets (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Prepaid Expense And Other Assets Current [Abstract] | ||
Derivative assets | $ 16,959 | $ 60,687 |
Unamortized bond/insurance premiums | 4,944 | 5,197 |
Prepaid deposits related to royalties | 8,871 | 8,872 |
Other | 3,353 | 1,650 |
Prepaid expenses and other assets | $ 34,127 | $ 76,406 |
Basis of Presentation - Sched_3
Basis of Presentation - Schedule of Oil and Natural Gas Properties and Other, Net at Cost (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Property Plant And Equipment Net [Abstract] | ||
Oil and natural gas properties and equipment | $ 8,198,394 | $ 8,169,871 |
Furniture, fixtures and other | 20,228 | 20,228 |
Total property and equipment | 8,218,622 | 8,190,099 |
Less accumulated depreciation, depletion and amortization | 7,703,857 | 7,674,678 |
Oil and natural gas properties and other, net | $ 514,765 | $ 515,421 |
Basis of Presentation - Sched_4
Basis of Presentation - Schedule of Other Assets (Long-term) (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Other Assets [Abstract] | ||
Escrow deposit - Apache lawsuit | $ 49,500 | $ 49,500 |
Derivative assets | 4,169 | 21,275 |
Appeal bond deposits | 6,925 | 6,925 |
Unamortized debt issuance costs | 4,511 | 4,773 |
Investment in White Cap, LLC | 2,546 | 2,586 |
Unamortized brokerage fee for Monza | 3,746 | 2,277 |
Proportional consolidation of Monza's other assets (Note 4) | 3,299 | 3,275 |
Other | 4,309 | 936 |
Total other assets (long-term) | $ 79,005 | $ 91,547 |
Basis of Presentation - Sched_5
Basis of Presentation - Schedule of Accrued Liabilities (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Payables And Accruals [Abstract] | ||
Accrued interest | $ 27,624 | $ 12,385 |
Accrued salaries/payroll taxes/benefits | 2,425 | 2,320 |
Incentive compensation plans | 10,817 | |
Litigation accruals | 3,673 | 3,673 |
Other | 1,475 | 416 |
Total accrued liabilities | $ 35,197 | $ 29,611 |
Basis of Presentation - Sched_6
Basis of Presentation - Schedule of Other Liabilities (Long-term) (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Other Liabilities Disclosure [Abstract] | ||
Apache lawsuit | $ 49,500 | $ 49,500 |
Uncertain tax positions including interest/penalties | 11,694 | 11,523 |
Dispute related to royalty deductions | 4,687 | 4,687 |
Dispute related to royalty-in-kind | 2,164 | 2,135 |
Other | 5,097 | 845 |
Total other liabilities (long-term) | $ 73,142 | $ 68,690 |
Long-Term Debt - Components of
Long-Term Debt - Components of Long-Term Debt (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 | Oct. 18, 2018 |
Debt Instrument [Line Items] | |||
Unamortized debt issuance costs | $ (4,511) | $ (4,773) | |
Total long-term debt | 634,005 | 633,535 | |
Credit Agreement Borrowings | |||
Debt Instrument [Line Items] | |||
Carrying value | 21,000 | 21,000 | |
Senior Second Lien Notes | |||
Debt Instrument [Line Items] | |||
Carrying value | 613,005 | 612,535 | |
Principal | 625,000 | 625,000 | $ 625,000 |
Unamortized debt issuance costs | (11,995) | (12,465) | |
Total long-term debt | $ 613,005 | $ 612,535 |
Long-Term Debt - Additional Inf
Long-Term Debt - Additional Information (Details) - USD ($) $ in Thousands | Oct. 18, 2018 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | May 02, 2019 | Dec. 31, 2018 |
Credit Agreement Borrowings | |||||||
Debt Instrument [Line Items] | |||||||
Credit agreement expiration date | Oct. 18, 2022 | ||||||
Initial borrowing base and lending commitment | $ 250,000 | ||||||
Letters of credit issued and outstanding | $ 8,100 | $ 9,600 | |||||
Leverage ratio | 350.00% | ||||||
Debt instrument interest rate | 5.10% | ||||||
Credit Agreement Borrowings | Minimum | |||||||
Debt Instrument [Line Items] | |||||||
Credit agreement, current ratio | 100.00% | ||||||
Credit Agreement Borrowings | Scenario, Forecast | |||||||
Debt Instrument [Line Items] | |||||||
Leverage ratio | 300.00% | 325.00% | 325.00% | ||||
Credit Agreement Borrowings | Two Quarters After Material Acquisition | |||||||
Debt Instrument [Line Items] | |||||||
Leverage ratio | 350.00% | ||||||
Credit Agreement Borrowings | Letters of Credit | |||||||
Debt Instrument [Line Items] | |||||||
Initial borrowing base and lending commitment | $ 30,000 | ||||||
Senior Second Lien Notes | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument interest rate | 9.75% | ||||||
Debt instrument aggregate principal amount | $ 625,000 | $ 625,000 | $ 625,000 | ||||
Debt instrument maturity date | Nov. 1, 2023 | ||||||
Debt instrument payment terms | Interest on the Senior Second Lien Notes is payable in arrears on May 1 and November 1 of each year, beginning on May 1, 2019. | ||||||
Annual effective interest rate | 10.30% |
Fair Value Measurements - Sched
Fair Value Measurements - Schedule of Open Derivative Financial Instruments (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Open Contracts | ||
Assets: | ||
Derivatives instruments | $ 20,275 | $ 74,580 |
Fair Value Measurements - Sch_2
Fair Value Measurements - Schedule of Carrying Value and Fair Value of Long-Term Debt (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Long-term debt, Carrying Value | $ 634,005 | $ 633,535 |
Credit Agreement | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Long-term debt, Carrying Value | 21,000 | 21,000 |
Credit Agreement | Fair Value, Inputs, Level 2 | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Long-term debt, Fair Value | 21,000 | 21,000 |
Senior Second Lien Notes | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Long-term debt, Carrying Value | 613,005 | 612,535 |
Senior Second Lien Notes | Fair Value, Inputs, Level 2 | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Long-term debt, Fair Value | $ 623,256 | $ 546,875 |
Joint Venture Drilling Program
Joint Venture Drilling Program - Additional Information (Details) | Mar. 12, 2018USD ($)DrillingProject | Mar. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Mar. 31, 2018USD ($) | Dec. 31, 2018USD ($) |
Oil And Gas In Process Activities [Line Items] | |||||
Oil and natural gas properties | $ 514,765,000 | $ 515,421,000 | $ 515,421,000 | ||
Other assets | 79,005,000 | 91,547,000 | 91,547,000 | ||
Total revenues | 116,080,000 | $ 134,213,000 | |||
Advances from joint interest partners | 65,271,000 | 20,627,000 | 20,627,000 | ||
Monza Energy LLC | |||||
Oil And Gas In Process Activities [Line Items] | |||||
Oil and natural gas properties | 11,000,000 | 8,800,000 | 8,800,000 | ||
Other assets | 3,300,000 | 3,300,000 | 3,300,000 | ||
Increase in working capital | 5,000,000 | $ 700,000 | |||
Total revenues | 1,600,000 | 0 | |||
Operating cots and expense | 900,000 | ||||
Operating expense | $ 0 | ||||
Cash calls received | 66,300,000 | ||||
Advances from joint interest partners | $ 65,200,000 | ||||
JV Drilling Program | Mr. Tracy W. Krohn | |||||
Oil And Gas In Process Activities [Line Items] | |||||
Minority interest ownership percentage by joint venture | 4.50% | ||||
JV Drilling Program | Monza Energy LLC | |||||
Oil And Gas In Process Activities [Line Items] | |||||
Joint venture ownership percentage contributed to related party | 88.94% | ||||
Joint venture ownership percentage | 11.06% | ||||
Commitment amount by investors | $ 361,400,000 | ||||
Percentage of revenue less expenses from joint venture | 30.00% | ||||
Percentage of estimated well cost | 20.00% | ||||
Capital contribution payments from members of Monza | $ 184,900,000 | ||||
Capital contribution payments from members of Monza during period | 70,200,000 | ||||
Contributions, net of distributions, paid to related party | 58,900,000 | ||||
JV Drilling Program | Monza Energy LLC | Mr. Tracy W. Krohn | |||||
Oil And Gas In Process Activities [Line Items] | |||||
Capital commitment | $ 14,500,000 | ||||
JV Drilling Program | Monza Energy LLC | Maximum | |||||
Oil And Gas In Process Activities [Line Items] | |||||
Number of drilling projects | DrillingProject | 14 |
Asset Retirement Obligations -
Asset Retirement Obligations - Summary of Changes to Asset Retirement Obligation (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | Dec. 31, 2018 | |
Asset Retirement Obligation, Roll Forward Analysis [Roll Forward] | |||
Asset retirement obligations, beginning of period | $ 310,137 | ||
Liabilities settled | (254) | $ (7,022) | |
Accretion of discount | 4,588 | ||
Liabilities incurred | 44 | ||
Revisions of estimated liabilities | (353) | ||
Asset retirement obligations, end of period | 314,162 | ||
Less current portion | 24,799 | $ 24,994 | |
Long-term | $ 289,363 | $ 285,143 |
Derivative Financial Instrume_3
Derivative Financial Instruments - Summary of Open Commodity Derivative Contracts (Details) | 3 Months Ended | |
Mar. 31, 2019MMBTU$ / Derivativebbl | ||
N Y M E X Crude Oil Swap | Open Crude Oil Derivative Contracts One | ||
Derivatives Fair Value [Line Items] | ||
Termination Period | May 2020 | |
Notional Quantity (Bbls/day) | 1,500 | [1] |
Notional Quantity (Bbls) | 640,500 | [1] |
Strike Price | $ / Derivative | 60.80 | |
N Y M E X Crude Oil Swap | Open Crude Oil Derivative Contracts Two | ||
Derivatives Fair Value [Line Items] | ||
Termination Period | May 2020 | |
Notional Quantity (Bbls/day) | 5,000 | [1] |
Notional Quantity (Bbls) | 2,135,000 | [1] |
Strike Price | $ / Derivative | 61 | |
N Y M E X Crude Oil Swap | Open Crude Oil Derivative Contracts Three | ||
Derivatives Fair Value [Line Items] | ||
Termination Period | May 2020 | |
Notional Quantity (Bbls/day) | 3,500 | [1] |
Notional Quantity (Bbls) | 1,494,500 | [1] |
Strike Price | $ / Derivative | 60.85 | |
NYMEX Crude Oil Calls | Bought | ||
Derivatives Fair Value [Line Items] | ||
Termination Period | May 2020 | |
Notional Quantity (Bbls/day) | 10,000 | [1] |
Notional Quantity (Bbls) | 4,270,000 | [1] |
Strike Price | $ / Derivative | 61 | |
NYMEX Natural Gas Two Way Collars | ||
Derivatives Fair Value [Line Items] | ||
Termination Period | June 2019 | |
Notional Quantity (MMBtu/day) | MMBTU | 50,000 | [2] |
Notional Quantity (MMBtu) | MMBTU | 3,050,000 | [2] |
NYMEX Natural Gas Two Way Collars | Bought | Put Option | ||
Derivatives Fair Value [Line Items] | ||
Strike Price | $ / Derivative | 2.49 | |
NYMEX Natural Gas Two Way Collars | Sold | Call Option | ||
Derivatives Fair Value [Line Items] | ||
Strike Price | $ / Derivative | 3.975 | |
[1] | Bbls = Barrels | |
[2] | MMBtu – Million British Thermal Units |
Derivative Financial Instrume_4
Derivative Financial Instruments - Summary of Open Contracts and Closed Contracts (Not yet Settled) Commodity Derivative Contracts (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Derivatives Fair Value [Line Items] | ||
Prepaid expenses and other assets | $ 16,959 | $ 60,687 |
Other assets (non-current) | 4,169 | 21,275 |
Open Contracts and Closed Contracts - Not Yet Settled | ||
Derivatives Fair Value [Line Items] | ||
Prepaid expenses and other assets | 16,959 | 60,687 |
Other assets (non-current) | $ 4,169 | $ 21,275 |
Derivative Financial Instrume_5
Derivative Financial Instruments - Changes in Fair Value and Settlements of Commodity Derivative Contracts (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2019USD ($) | |
Gain Loss On Derivative Instruments Net Pretax [Abstract] | |
Derivative loss | $ 48,886 |
Derivative Financial Instrume_6
Derivative Financial Instruments - Cash Receipts on Derivative Settlements, Net Included within Net Cash Provided by Operating Activities (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2019USD ($) | |
Derivative Instruments And Hedging Activities Disclosure [Abstract] | |
Cash receipts on derivative settlements, net | $ 11,948 |
Share-Based Compensation and _3
Share-Based Compensation and Cash-Based Incentive Compensation - Additional Information (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2019USD ($)Awardshares | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Common stock available for award under plans | shares | 11,852,592 |
Number of cash based awards | Award | 2 |
Directors Compensation Plan | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Common stock available for award under plans | shares | 128,980 |
Restricted Stock Units (RSUs) | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Common shares available for issuance reduced conversion basis | One-for-one basis |
Unrecognized share-based compensation expense | $ | $ 5.5 |
Recognition period for unrecognized compensation expense | 2020-11 |
Restricted Shares | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Unrecognized share-based compensation expense | $ | $ 0.3 |
Recognition period for unrecognized compensation expense | 2021-04 |
Restricted Shares | Directors Compensation Plan | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Common shares available for issuance reduced conversion basis | One-to-one basis |
2018 Long-term Cash-based Awards | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Cash-based awards expected payment date | Dec. 14, 2020 |
2018 Short-term Cash-based Awards | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Cash-based awards payment date | Mar. 31, 2019 |
2017 Cash-based Awards | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Cash-based awards payment date | Mar. 31, 2018 |
Share-Based Compensation and _4
Share-Based Compensation and Cash-Based Incentive Compensation - Summary of Share Activity Related to Restricted Stock Units (Details) - Restricted Stock Units (RSUs) | 3 Months Ended | |
Mar. 31, 2019$ / sharesshares | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Nonvested, beginning of period | shares | 3,355,917 | |
Forfeited | shares | (856,718) | [1] |
Nonvested, end of period | shares | 2,499,199 | |
Weighted Average Grant Date Value, Beginning of period | $ / shares | $ 3.90 | |
Weighted Average Grant Date Fair Value, Forfeited | $ / shares | 2.77 | |
Weighted Average Grant Date Value, End of period | $ / shares | $ 4.28 | |
[1] | Primarily related to a former executive’s forfeitures. |
Share-Based Compensation and _5
Share-Based Compensation and Cash-Based Incentive Compensation - Schedule of Outstanding Restricted Stock Units Issued to Eligible Employees (Details) - Restricted Stock Units (RSUs) - shares | Mar. 31, 2019 | Dec. 31, 2018 |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Awards expected to vest by period | 2,499,199 | 3,355,917 |
2019 | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Awards expected to vest by period | 1,579,140 | |
2020 | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Awards expected to vest by period | 920,059 |
Share-Based Compensation and _6
Share-Based Compensation and Cash-Based Incentive Compensation - Schedule of Outstanding Restricted Shares Issued to Non-employee Directors (Details) - Restricted Shares | Mar. 31, 2019shares |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Awards expected to vest by period | 181,832 |
2019 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Awards expected to vest by period | 105,012 |
2020 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Awards expected to vest by period | 62,972 |
2021 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Awards expected to vest by period | 13,848 |
Share-Based Compensation and _7
Share-Based Compensation and Cash-Based Incentive Compensation - Summary of Incentive Compensation Expense under Share-Based Payment Arrangements (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Share-based compensation | $ (78) | $ 1,219 | |
Restricted Stock Units (RSUs) | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Share-based compensation | [1] | (148) | 1,149 |
Restricted Shares | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Share-based compensation | $ 70 | $ 70 | |
[1] | For the 2019 period, the net credit is due to a former executive’s forfeitures. |
Share-Based Compensation and _8
Share-Based Compensation and Cash-Based Incentive Compensation - Summary of Compensation Expense Related to Share-Based Awards and Cash-Based Awards (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | ||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | |||
Share-based compensation charged to operating income | $ (78) | $ 1,219 | |
Total charged to operating income | 1,894 | 4,751 | |
General And Administrative Expense | |||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | |||
Share-based compensation charged to operating income | (78) | 1,219 | |
Cash-based incentive compensation charged to operating income | [1] | 2,095 | 2,672 |
Lease Operating Expense | |||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | |||
Cash-based incentive compensation charged to operating income | [1] | $ (123) | $ 860 |
[1] | Includes adjustments of accruals to actual payments. |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) | 3 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | Dec. 31, 2018 | |
Income Tax Expense (Benefit), Continuing Operations [Abstract] | |||
Income tax expense | $ 172,000 | $ 109,000 | |
Income tax refund received | 0 | 0 | |
Cash paid for income taxes | 0 | $ 0 | |
Valuation allowance | 127,800,000 | $ 117,800,000 | |
Current income taxes receivable | $ 54,076,000 | $ 54,076,000 | |
Earliest Tax Year | |||
Income Tax Expense (Benefit), Continuing Operations [Abstract] | |||
Tax years under examination | 2013 | ||
Latest Tax Year | |||
Income Tax Expense (Benefit), Continuing Operations [Abstract] | |||
Tax years under examination | 2018 |
Earnings Per Share - Schedule o
Earnings Per Share - Schedule of Calculation of Basic and Diluted (Loss) Earnings Per Common Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Earnings Per Share, Basic and Diluted [Abstract] | ||
Net (loss) income | $ (47,761) | $ 27,640 |
Less portion allocated to nonvested shares | 1,145 | |
Net (loss) income allocated to common shares | $ (47,761) | $ 26,495 |
Weighted average common shares outstanding | 140,462 | 138,845 |
Basic and diluted (loss) earnings per common share | $ (0.34) | $ 0.19 |
Shares excluded due to being anti-dilutive (weighted-average) | 3,342 |
Contingencies - Additional Info
Contingencies - Additional Information (Details) | 3 Months Ended | 12 Months Ended | |||||
Mar. 31, 2019USD ($)claim | Mar. 31, 2018USD ($) | Dec. 31, 2018USD ($) | May 31, 2017USD ($) | Jan. 27, 2017USD ($) | Dec. 15, 2014DeepwaterWell | Dec. 31, 2010USD ($) | |
Loss Contingencies [Line Items] | |||||||
Number of deepwater wells abandoned | DeepwaterWell | 3 | ||||||
Deposit Into registry of court | $ 49,500,000 | $ 49,500,000 | |||||
Loss contingency accrued amount | 49,500,000 | 49,500,000 | |||||
Notified disallowed amount in reductions taken by ONRR | $ 4,700,000 | $ 4,700,000 | |||||
Bond requied to post in order to appeal | 7,200,000 | ||||||
Cash collateral required to appeal | $ 6,900,000 | ||||||
Liability reserve | $ 2,200,000 | 2,100,000 | |||||
Royalty payment processing revised period | 84 months | ||||||
Royalties paid | $ 100,000 | $ 100,000 | |||||
BSEE | |||||||
Loss Contingencies [Line Items] | |||||||
Loss contingency accrued amount | $ 3,400,000 | 3,400,000 | |||||
Number of notices | claim | 9 | ||||||
Proposed civil penalties related to various incidents of noncompliance, total | $ 7,700,000 | ||||||
Payments for civil penalty | 0 | $ 0 | |||||
Apache Corporation | Judicial Ruling | |||||||
Loss Contingencies [Line Items] | |||||||
Amount owed to Apache under judicial decision | $ 43,200,000 | ||||||
Prejudgment interest, attorney fees and judgment costs | $ 6,300,000 | ||||||
Apache Corporation | Judicial Ruling | Other Noncurrent Assets | |||||||
Loss Contingencies [Line Items] | |||||||
Deposit Into registry of court | 49,500,000 | 49,500,000 | |||||
Apache Corporation | Judicial Ruling | Other Noncurrent Liabilities | |||||||
Loss Contingencies [Line Items] | |||||||
Loss contingency accrued amount | $ 49,500,000 | $ 49,500,000 |