Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2018 | Nov. 08, 2018 | |
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2018 | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q3 | |
Trading Symbol | CRK | |
Entity Registrant Name | COMSTOCK RESOURCES INC | |
Entity Central Index Key | 23,194 | |
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 | 105,871,064 |
CONSOLIDATED BALANCE SHEETS (Un
CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
ASSETS | ||
Cash and Cash Equivalents | $ 31,780 | |
Accounts Receivable: | ||
Oil and gas sales | 61,003 | |
Joint interest operations | 19,619 | |
Other Current Assets | 19,070 | |
Total current assets | 131,472 | |
Oil and gas properties, successful efforts method | ||
Proved | 1,568,504 | |
Unproved | 195,178 | |
Other | 4,440 | |
Accumulated depreciation, depletion and amortization | (174,520) | |
Net property and equipment | 1,593,602 | |
Goodwill | 349,667 | |
Income Taxes Receivable | 19,086 | |
Other Assets | 549 | |
Total Assets | 2,094,376 | |
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) | ||
Accounts Payable | 124,008 | |
Accrued Expenses | 53,261 | |
Derivative Financial Instruments | 2,849 | |
Total current liabilities | 180,118 | |
Long-term Debt | 1,242,844 | |
Deferred Income Taxes | 145,565 | |
Reserve for Future Abandonment Costs | 4,738 | |
Total liabilities | 1,573,265 | |
Commitments and Contingencies | ||
Stockholders' Equity (Deficit): | ||
Common stock — $0.50 par, 155,000,000 shares authorized, 105,879,064 shares issued and outstanding at September 30, 2018, 75,000,000 authorized, 15,427,561 shares issued and outstanding as of December 31, 2017 | 52,940 | |
Additional paid-in capital | 454,348 | |
Accumulated earnings (deficit) | 13,823 | |
Total stockholders' equity (deficit) | 521,111 | |
Total liabilities and stockholders' equity (deficit) | $ 2,094,376 | |
Predecessor | ||
ASSETS | ||
Cash and Cash Equivalents | $ 61,255 | |
Accounts Receivable: | ||
Oil and gas sales | 26,700 | |
Joint interest operations | 11,872 | |
Derivative Financial Instruments | 1,318 | |
Assets Held For Sale | 198,615 | |
Other Current Assets | 2,745 | |
Total current assets | 302,505 | |
Oil and gas properties, successful efforts method | ||
Proved | 2,631,750 | |
Other | 18,918 | |
Accumulated depreciation, depletion and amortization | (2,042,739) | |
Net property and equipment | 607,929 | |
Income Taxes Receivable | 19,086 | |
Other Assets | 899 | |
Total Assets | 930,419 | |
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) | ||
Accounts Payable | 126,034 | |
Accrued Expenses | 42,455 | |
Total current liabilities | 168,489 | |
Long-term Debt | 1,110,529 | |
Deferred Income Taxes | 10,266 | |
Reserve for Future Abandonment Costs | 10,407 | |
Total liabilities | 1,299,691 | |
Commitments and Contingencies | ||
Stockholders' Equity (Deficit): | ||
Common stock — $0.50 par, 155,000,000 shares authorized, 105,879,064 shares issued and outstanding at September 30, 2018, 75,000,000 authorized, 15,427,561 shares issued and outstanding as of December 31, 2017 | 7,714 | |
Common stock warrants | 3,557 | |
Additional paid-in capital | 546,696 | |
Accumulated earnings (deficit) | (927,239) | |
Total stockholders' equity (deficit) | (369,272) | |
Total liabilities and stockholders' equity (deficit) | $ 930,419 |
CONSOLIDATED BALANCE SHEETS (_2
CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) - $ / shares | Sep. 30, 2018 | Dec. 31, 2017 |
Common stock, par value | $ 0.50 | |
Common stock, shares authorized | 155,000,000 | |
Common stock, shares issued | 105,879,064 | |
Common stock, shares outstanding | 105,879,064 | |
Predecessor | ||
Common stock, par value | $ 0.50 | |
Common stock, shares authorized | 75,000,000 | |
Common stock, shares issued | 15,427,561 | |
Common stock, shares outstanding | 15,427,561 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($) shares in Thousands, $ in Thousands | 1 Months Ended | 3 Months Ended | 7 Months Ended | 9 Months Ended |
Aug. 13, 2018 | Sep. 30, 2017 | Aug. 13, 2018 | Sep. 30, 2017 | |
Other income (expenses): | ||||
Net income (loss) per share – basic and diluted | $ (1.09) | $ (1.67) | ||
Predecessor | ||||
Revenues: | ||||
Total oil and gas sales | $ 32,588 | $ 66,811 | $ 166,630 | $ 182,083 |
Operating expenses: | ||||
Production taxes | 707 | 1,490 | 3,659 | 3,730 |
Gathering and transportation | 3,109 | 4,755 | 11,841 | 12,428 |
Lease operating | 3,418 | 9,359 | 21,139 | 28,681 |
Depreciation, depletion and amortization | 14,082 | 32,783 | 68,032 | 93,009 |
General and administrative | 3,044 | 6,174 | 15,699 | 19,134 |
Loss (gain) on sale of oil and gas properties | 1,060 | 35,438 | 1,060 | |
Total operating expenses | 24,360 | 55,621 | 155,808 | 158,042 |
Operating income | 8,228 | 11,190 | 10,822 | 24,041 |
Other income (expenses): | ||||
Gain (loss) from derivative financial instruments | (83) | 1,430 | 881 | 14,585 |
Other income | 284 | 170 | 677 | 398 |
Interest expense | (22,140) | (37,595) | (101,203) | (107,250) |
Transaction costs | (2,549) | (2,866) | ||
Total other income (expenses) | (24,488) | (35,995) | (102,511) | (92,267) |
Income (loss) before income taxes | (16,260) | (24,805) | (91,689) | (68,226) |
Benefit from (provision for) income taxes | (605) | 69 | (1,065) | (883) |
Net income (loss) | $ (16,865) | $ (24,736) | $ (92,754) | $ (69,109) |
Net income (loss) per share – basic and diluted | $ (1.09) | $ (1.67) | $ (6.08) | $ (4.74) |
Weighted average shares outstanding – | ||||
Basic | 15,468 | 14,796 | 15,262 | 14,591 |
Diluted | 15,468 | 14,796 | 15,262 | 14,591 |
Natural Gas Sales | Predecessor | ||||
Revenues: | ||||
Total oil and gas sales | $ 32,089 | $ 56,164 | $ 147,897 | $ 147,541 |
Oil Sales | Predecessor | ||||
Revenues: | ||||
Total oil and gas sales | $ 499 | $ 10,647 | $ 18,733 | $ 34,542 |
CONSOLIDATED STATEMENT OF STOCK
CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY (DEFICIT) (Unaudited) - USD ($) $ in Thousands | Total | Common Stock | Common Stock Warrants | Additional Paid-in Capital | Accumulated Earnings (Deficit) |
Beginning Balance (Predecessor) at Dec. 31, 2017 | $ (369,272) | $ 7,714 | $ 3,557 | $ 546,696 | $ (927,239) |
Beginning Balance, Shares (Predecessor) at Dec. 31, 2017 | 15,428,000 | ||||
Stock-based compensation | Predecessor | 3,912 | $ 311 | 3,601 | ||
Stock-based compensation, Shares | Predecessor | 623,000 | ||||
Income tax withholdings related to equity awards | Predecessor | (369) | $ (26) | (343) | ||
Income tax withholdings related to equity awards, Shares | Predecessor | (53,000) | ||||
Common stock warrants exercised | Predecessor | $ 189 | (3,247) | 3,058 | ||
Common stock warrants exercised, Shares | Predecessor | 379,000 | ||||
Common stock issued for debt conversions | Predecessor | 29 | $ 1 | 28 | ||
Common stock issued for debt conversions, Shares | Predecessor | 2,000 | ||||
Net income (loss) | Predecessor | (92,754) | (92,754) | |||
Ending Balance (Predecessor) at Aug. 13, 2018 | (458,454) | $ 8,189 | 310 | 553,040 | (1,019,993) |
Ending Balance, shares (Predecessor) at Aug. 13, 2018 | 16,379,000 | ||||
Beginning Balance (Predecessor) at Dec. 31, 2017 | $ (369,272) | $ 7,714 | 3,557 | 546,696 | (927,239) |
Beginning Balance, Shares (Predecessor) at Dec. 31, 2017 | 15,428,000 | ||||
Common stock warrants exercised, Shares | 402,708 | ||||
Ending Balance at Sep. 30, 2018 | $ 521,111 | $ 52,940 | 454,348 | 13,823 | |
Ending Balance, shares at Sep. 30, 2018 | 105,879,000 | ||||
Successor common stock, Value | 140,531 | $ 8,189 | 310 | 132,032 | |
Successor common stock, Shares | 16,379,000 | ||||
Vesting of equity awards | 8,826 | $ 514 | 8,312 | ||
Vesting of equity awards, Shares | 1,029,000 | ||||
Jones contribution | 362,692 | $ 44,286 | 318,406 | ||
Jones contribution, Shares | 88,571,000 | ||||
Beginning Balance (Predecessor) at Aug. 13, 2018 | (458,454) | $ 8,189 | 310 | 553,040 | (1,019,993) |
Beginning Balance, Shares (Predecessor) at Aug. 13, 2018 | 16,379,000 | ||||
Stock-based compensation | 329 | $ 211 | 118 | ||
Stock-based compensation, Shares | 423,000 | ||||
Income tax withholdings related to equity awards | (4,695) | $ (272) | (4,423) | ||
Income tax withholdings related to equity awards, Shares | (547,000) | ||||
Stock issuance costs | (395) | (395) | |||
Common stock warrants exercised and expired | $ 12 | $ (310) | 298 | ||
Common stock warrants exercised and expired, Shares | 24,000 | ||||
Net income (loss) | 13,823 | 13,823 | |||
Ending Balance at Sep. 30, 2018 | $ 521,111 | $ 52,940 | $ 454,348 | $ 13,823 | |
Ending Balance, shares at Sep. 30, 2018 | 105,879,000 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands | 1 Months Ended | 2 Months Ended | 3 Months Ended | 4 Months Ended | 7 Months Ended | 9 Months Ended | |
Aug. 13, 2018 | Sep. 30, 2018 | Sep. 30, 2017 | Aug. 13, 2018 | Aug. 13, 2018 | Sep. 30, 2018 | Sep. 30, 2017 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | |||||||
Net income (loss) | $ 13,823 | ||||||
Adjustments to reconcile net loss to net cash provided by operating activities: | |||||||
Deferred income taxes | 3,883 | ||||||
Loss (gain) on sale of oil and gas properties | (98) | ||||||
Depreciation, depletion and amortization | 17,820 | ||||||
(Gain) loss on derivative financial instruments | 2,015 | ||||||
Cash settlements of derivative financial instruments | 191 | ||||||
Amortization of debt discount, premium and issuance costs | 822 | ||||||
Stock-based compensation | 329 | ||||||
Decrease (increase) in accounts receivable | (44,884) | ||||||
Decrease (increase) in other current assets | (1,326) | ||||||
Increase in accounts payable and accrued expenses | 11,034 | ||||||
Net cash provided by operating activities | 3,609 | ||||||
CASH FLOWS FROM INVESTING ACTIVITIES: | |||||||
Acquisitions and capital expenditures | (59,017) | ||||||
Prepaid drilling costs | (4,768) | ||||||
Proceeds from sale of oil and gas properties | 13,739 | ||||||
Net cash used for investing activities | (50,046) | ||||||
CASH FLOWS FROM FINANCING ACTIVITIES: | |||||||
Borrowings | 450,000 | ||||||
Retirement of long-term debt | (1,291,352) | ||||||
Jones contribution | 36,365 | $ 43,200 | |||||
Debt and stock issuance costs | (6,288) | ||||||
Income taxes related to equity awards | (4,695) | ||||||
Net cash provided by (used for) financing activities | (815,970) | ||||||
Net increase (decrease) in cash and cash equivalents | (862,407) | ||||||
Cash and cash equivalents, beginning of period | 894,187 | ||||||
Cash and cash equivalents, end of period | $ 894,187 | 31,780 | 894,187 | $ 894,187 | $ 31,780 | ||
Predecessor | |||||||
CASH FLOWS FROM OPERATING ACTIVITIES: | |||||||
Net income (loss) | (92,754) | $ (69,109) | |||||
Adjustments to reconcile net loss to net cash provided by operating activities: | |||||||
Deferred income taxes | 1,052 | 768 | |||||
Loss (gain) on sale of oil and gas properties | 35,438 | 1,060 | |||||
Depreciation, depletion and amortization | 14,082 | $ 32,783 | 68,032 | 93,009 | |||
(Gain) loss on derivative financial instruments | (881) | (14,585) | |||||
Cash settlements of derivative financial instruments | 2,842 | 5,352 | |||||
Amortization of debt discount, premium and issuance costs | 29,457 | 24,914 | |||||
Interest paid in-kind | 25,004 | 28,194 | |||||
Stock-based compensation | 3,912 | 4,455 | |||||
Decrease (increase) in accounts receivable | 2,834 | (11,952) | |||||
Decrease (increase) in other current assets | 337 | (670) | |||||
Increase in accounts payable and accrued expenses | 10,462 | 29,327 | |||||
Net cash provided by operating activities | 85,735 | 90,763 | |||||
CASH FLOWS FROM INVESTING ACTIVITIES: | |||||||
Acquisitions and capital expenditures | (150,106) | (132,493) | |||||
Prepaid drilling costs | (3,692) | ||||||
Proceeds from sale of oil and gas properties | 103,593 | 1,528 | |||||
Net cash used for investing activities | (50,205) | (130,965) | |||||
CASH FLOWS FROM FINANCING ACTIVITIES: | |||||||
Borrowings | 865,577 | ||||||
Retirement of long-term debt | (49,679) | ||||||
Common stock warrants exercised | 2 | ||||||
Debt and stock issuance costs | (18,127) | ||||||
Income taxes related to equity awards | (369) | (312) | |||||
Net cash provided by (used for) financing activities | 797,402 | (310) | |||||
Net increase (decrease) in cash and cash equivalents | 832,932 | (40,512) | |||||
Cash and cash equivalents, beginning of period | $ 894,187 | 61,255 | $ 61,255 | 65,904 | |||
Cash and cash equivalents, end of period | $ 894,187 | $ 25,392 | $ 894,187 | $ 894,187 | $ 25,392 |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2018 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | (1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES – Basis of Presentation These unaudited consolidated financial statements include the accounts of Comstock and its wholly-owned subsidiaries. The accompanying unaudited consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and disclosures normally included in annual financial statements prepared in accordance with accounting principles generally accepted in the United States have been omitted pursuant to those rules and regulations, although Comstock believes that the disclosures made are adequate to make the information presented not misleading. These unaudited consolidated financial statements should be read in conjunction with the financial statements and notes thereto included in Comstock's Annual Report on Form 10-K for the year ended December 31, 2017. The results of operations for the Predecessor and Successor periods up to and through September 30, 2018 are not necessarily an indication of the results expected for the full year. On August 14, 2018, Arkoma Drilling, L.P. and Williston Drilling, L.P. (collectively, the "Jones Partnerships") contributed certain oil and gas properties in North Dakota and Montana (the "Bakken Shale Properties") in exchange for common stock representing 84% of the Company's outstanding common stock (the "Jones Contribution"). The Jones Partnerships are wholly owned and controlled by Dallas businessman Jerry Jones and his children (collectively, the "Jones Group"). The Jones Partnerships received 88,571,429 newly issued shares of common stock based on an agreed upon share price of $7.00 per share. The Company assessed the Bakken Shale Properties to determine whether they meet the definition of a business under US generally accepted accounting principles, determining that they do not meet the definition of a business. As a result, the Jones Contribution is not being accounted for as a business combination. Upon the issuance of the shares of Comstock common stock, the Jones Group obtained control over Comstock through their ownership of the Jones Partnerships. Through the Jones Partnerships, the Jones Group owns a majority of the voting common stock as well as the ability to control the composition of the majority of the board of directors of Comstock. As a result of the change of control that occurred upon the issuance of the common stock, the Jones Group controls Comstock and, thereby, continues to control the Bakken Shale Properties. Accordingly, the basis of the Bakken Shale Properties recognized by Comstock is the historical basis of the Jones Group. The historical cost basis of the Bakken Shale properties contributed was $397.6 million, which was comprised of $554.3 million of capitalized costs less $156.7 million of accumulated depletion, depreciation and amortization. The change in control of Comstock results in a new basis for Comstock as the company has elected to apply pushdown accounting pursuant to ASC 805, Business Combinations. The new basis is pushed down to Comstock for financial reporting purposes, resulting in Comstock's assets, liabilities and equity accounts being recognized at fair value upon the closing of the Jones Transactions. References to "Successor" or "Successor Company" relate to the financial position and results of operations of the Company subsequent to August 13, 2018. Reference to "Predecessor" or "Predecessor Company" relate to the financial position and results of operations of the Company on or prior to August 13, 2018. The Company's consolidated financial statements and related footnotes are presented with a black line division which delineates the lack of comparability between amounts presented after August 13, 2018 and dates prior thereto. The estimated fair value of Comstock's assets and liabilities and the resulting goodwill at the date of the transaction were as follows: (In thousands) Fair Value of Comstock's common stock $ 149,357 Fair Value of Liabilities Assumed — Current Liabilities 180,452 Long-Term Debt 2,059,560 Deferred Income Taxes 63,708 Reserve for Future Abandonment Costs 4,440 Net Liabilities Assumed 2,308,160 Fair Value of Assets Acquired — Current Assets 936,026 Oil and Gas Properties 1,147,749 Other Property & Equipment 4,440 Income Taxes Receivable 19,086 Other Assets 549 Total Assets 2,107,850 Goodwill $ 349,667 The Goodwill recognized is primarily attributable to the excess of the fair value of Comstock's common stock over the identifiable assets acquired net of liabilities assumed, measured in accordance with generally accepted accounting principles in the United States. The fair value of oil and gas properties, a Level 3 measurement, was determined using discounted cash flow valuation methodology. Key inputs to the valuation included average oil prices of $79.72 per barrel, average natural gas prices of $3.87 per thousand cubic feet and discount factors of 10% - 25%. The combination of the Bakken Shale Properties with Comstock's Haynesville shale properties results in a Company with adequate resources and liquidity to fully exploit its Haynesville/Bossier shale asset base and to continue to expand its opportunity set with future acquisitions and leasing activity in the basin. Transaction-related costs (i.e., advisory, legal, accounting, valuation, other professional or consulting fees) totaling approximately $2.6 million are not included as a component of consideration transferred but are accounted for as expenses in the predecessor periods in which the costs are incurred and the services received. Costs incurred associated with the issuance of common stock have been accounted for as a reduction of additional paid-in capital. The successful closing of the Jones Contribution triggered payment of an aggregate of $8.1 million including success fees to financial advisors and certain other fees under our licenses for technical data. These costs were contingent on the consummation of the transactions, all of which were interdependent and all of which had to close in order to meet the legal requirements of the contribution agreement. None of these fees would have been incurred otherwise. The Jones Contribution also caused a change in control, upon which restricted shares granted to employees and directors vested, and performance share units granted to executive officers vested at the maximum number of shares granted. The Company had previously recognized stock-based compensation expense of $7.2 million related to these restricted shares and performance share units. The Company did not recognize an expense for the remaining $11.9 million of unrecognized stock-based compensation expense. The Company's accounting policy for any cost triggered by the consummation of the Jones Contribution was to recognize the cost when the Jones Contribution was consummated. Accordingly, unrecognized stock-based compensation expense has not been recorded in the Consolidated Statement of Operations for the Predecessor period since that statement depicts the results of operations just prior to consummation of the transaction. In addition, since the Successor period reflects the effects of push-down accounting, these costs have also not been recorded as an expense in the Successor period. These costs are being considered in the purchase accounting adjustments in arriving at the fair value of the liabilities assumed since they were incurred only in the event the transactions successfully closed, and they are not clearly identifiable to operations either prior to or subsequent to the Jones Contribution. Under the terms of the Jones Contribution, April 1, 2018 was the effective date for allocation of revenues and expenses related to net cash of the Bakken Shale Properties, and Comstock will receive $43.2 million related to net cash flow from April 1, 2018 to August 13, 2018 from the Jones Partnerships which has been accounted as part of the Jones Contribution. These financial statements are presented on the basis of the Bakken Shale Properties being contributed to Comstock in exchange for common stock of Comstock. Comstock is a corporation, which is treated as a taxable C corporation and thus is subject to federal and state income taxes. A deferred tax liability of approximately $77.9 million has been recognized related to the tax basis of the Bakken Shale Properties long-lived assets being less than the book basis in those assets. The recording of this deferred tax liability has been treated as an adjustment to additional paid-in capital in these financial statements. The change in control of Comstock results in a new basis for Comstock as the company is applying pushdown accounting pursuant to ASC 805, Business Combinations. The new basis is pushed down to Comstock for financial reporting purposes, resulting in Comstock's assets, liabilities and equity accounts being recognized at fair value upon the closing of the Jones Contribution. A deferred tax liability, net of valuation allowance, of $52.4 million has been recognized related to the change in the basis for financial reporting purposes as compared to the tax basis of the historical Comstock assets. The unaudited pro forma financial information presented below sets forth the Company's historical statements of operations for the periods indicated and gives effect to the Jones Contribution and the Company's debt refinancing transactions as if "push down" accounting had been applied as of January 1, 2017. Such information is presented for comparative purposes to the Consolidated Statements of Operations only and does not purport to represent what the Company's results of operations would actually have been had these transactions occurred on the date indicated or to project its results of operations for any future period or date. Pro Forma Nine Months Ended September 30, 2018 (1) 2017 Revenues: Natural gas sales $ 196,049 $ 158,679 Oil sales 194,328 159,812 Total oil and gas sales 390,377 318,491 Operating expenses: Production taxes 22,168 16,722 Gathering and transportation 15,291 12,428 Lease operating 44,103 43,309 Depreciation, depletion and amortization 132,234 148,100 General and administrative 19,319 19,134 Loss on sale of oil and gas properties 35,340 1,060 Total operating expenses 268,455 240,753 Operating income 121,922 77,738 Other income (expenses): Gain (loss) from derivative financial instruments (1,134 ) 14,585 Other income 719 398 Interest expense (80,437 ) (89,063 ) Total other income (80,852 ) (74,080 ) Income before income taxes 41,070 3,658 Benefit from (provision for) income taxes (10,818 ) (2,211 ) Net Income $ 30,252 $ 1,447 Net income per share – basic and diluted $ 0.29 $ 0.01 Weighted average shares outstanding – Basic 105,448 105,095 Diluted 105,463 105,574 (1) Property and Equipment The Company follows the successful efforts method of accounting for its oil and gas properties. Costs incurred to acquire oil and gas leasehold are capitalized. On April 27, 2018, Comstock completed the sale of its producing Eagle Ford shale oil and gas properties in McMullen, LaSalle, Frio, Atascosa, Wilson, and Karnes counties, Texas for $125.0 million. The sale was effective November 1, 2017 and the estimated net cash flow from the properties from November 2017 to April 2018 was paid to the buyer at closing. After the sale, the Company had approximately 8,400 net undeveloped acres that are prospective for Eagle Ford shale development. During the predecessor period January 1, 2018 through August 13, 2018, the Company recognized a loss on sale of oil and gas properties of Results of operations for properties that were sold were as follows: Predecessor Predecessor Predecessor Three Months Ended September 30, 2017 For the Period from January 1, 2018 through August 13, 2018 Nine Months Ended September 30, 2017 Total oil and gas sales $ 11,079 $ 17,747 $ 36,495 Total operating expenses (1) (11,664 ) (6,134 ) (38,262 ) Operating income (loss) $ (585 ) $ 11,613 $ (1,767 ) (1) On July 31, 2018, the Company acquired oil and gas properties in North Louisiana and Texas for $39.3 million. These properties consist of approximately 23,000 gross acres (12,000 net) and include 120 (26.2 net) producing natural gas wells, 49 (14.7 net) which produce from the Haynesville shale. All of the acreage acquired is held by production. Comstock has identified 112 (31.0 net) potential drilling locations on this acreage of which 21 (17.9 net) would be operated by Comstock. On August 14, 2018, in connection with the Jones Contribution, the strategic drilling venture previously entered into by the Company and Arkoma Drilling, LP was terminated and Comstock re-acquired working interests in wells drilled under the joint venture for $17.9 million representing the costs paid by Arkoma Drilling, LP. The Company assesses the need for an impairment of the capitalized costs for its proved oil and gas properties on a property basis. No impairments were recognized to adjust the carrying value of the Company's proved oil and gas properties during any of the periods presented. Unproved oil and gas properties are also periodically assessed and any impairment in value is charged to expense. The costs of unproved properties are transferred to oil and gas properties and amortized on an equivalent unit-of-production basis as wells are drilled on these properties. The Company determines the fair values of its oil and gas properties using a discounted cash flow model and proved and risk-adjusted probable oil and natural gas reserves. Undrilled acreage can also be valued based on sales transactions in comparable areas. Significant Level 3 assumptions associated with the calculation of discounted future cash flows included in the cash flow model include management's outlook for oil and natural gas prices, production costs, capital expenditures, and future production as well as estimated proved oil and gas reserves and risk-adjusted probable oil and natural gas reserves. Management's oil and natural gas price outlook is developed based on third-party longer-term price forecasts as of each measurement date. The expected future net cash flows are discounted using an appropriate discount rate in determining a property's fair value. It is reasonably possible that the Company's estimates of undiscounted future net cash flows attributable to its oil and gas properties may change in the future. The primary factors that may affect estimates of future cash flows include future adjustments, both positive and negative, to proved and appropriate risk-adjusted probable oil and gas reserves, results of future drilling activities, future prices for oil and natural gas, and increases or decreases in production and capital costs. As a result of these changes, there may be future impairments in the carrying values of these or other properties. Goodwill Goodwill represents the excess of purchase price over fair value of net tangible and identifiable intangible assets related to the Jones Transactions. The Company is not required to amortize goodwill as a charge to earnings; however, the Company is required to conduct an annual review of goodwill for impairment. The Company will perform its first annual review of goodwill impairment starting on October 1, 2019. The Company has goodwill of $349.7 million as of September 30, 2018 that was recorded in connection with the Jones Contribution. Accrued Expenses Accrued expenses at September 30, 2018 and December 31, 2017 consist of the following: Successor Predecessor As of As of (In thousands) Accrued drilling costs $ 18,811 $ 5,874 Accrued interest payable 14,328 21,277 Accrued transportation costs 5,022 3,269 Accrued employee compensation 3,841 6,449 Accrued ad valorem taxes 5,021 — Accrued lease operating expenses 3,311 68 Asset retirement obligation – assets held for sale — 4,557 Other 2,927 961 $ 53,261 $ 42,455 Reserve for Future Abandonment Costs Comstock's asset retirement obligations relate to future plugging and abandonment expenses on its oil and gas properties and related facilities disposal. The following table summarizes the changes in Comstock's total estimated liability for such obligations during the periods presented: Successor Predecessor Predecessor For the Period from August 14, 2018 through September 30, 2018 For the Period from January 1, 2018 through August 13, 2018 Nine Months Ended September 30, 2017 (In thousands) Future abandonment costs — beginning of period $ 4,683 $ 10,407 $ 15,804 Accretion expense 45 346 645 New wells placed on production 10 17 5 Liabilities settled and assets disposed of — (87 ) (356 ) Future abandonment costs — end of period $ 4,738 $ 10,683 $ 16,098 Derivative Financial Instruments and Hedging Activities All of the Company's derivative financial instruments are used for risk management purposes and, by policy, none are held for trading or speculative purposes. Comstock minimizes credit risk to counterparties of its derivative financial instruments through formal credit policies, monitoring procedures, and diversification. The Company is not required to provide any credit support to its counterparties other than cross collateralization with the assets securing its bank credit facility. None of the Company's derivative financial instruments involve payment or receipt of premiums. The Company classifies the fair value amounts of derivative financial instruments as net current or noncurrent assets or liabilities, whichever the case may be, by commodity and counterparty. All of Comstock's natural gas derivative financial instruments are tied to the Henry Hub-NYMEX price index and all of its crude oil derivative financial instruments are tied to the WTI-NYMEX index price. The Company had the following outstanding derivative financial instruments for natural gas price risk management at September 30, 2018: Future Production Period Three Months Ending December 31, 2018 Year Ending December 31, 2019 Total Natural Gas Swap contracts: Volume (MMbtu) 5,400,000 4,200,000 9,600,000 Average Price per MMbtu $3.00 $3.00 $3.00 Natural Gas Collar contracts: Volume (MMbtu) 6,300,000 13,200,000 19,500,000 Price per MMbtu Average Ceiling $3.40 $3.40 $3.40 Average Floor $2.50 $2.50 $2.50 Crude Oil Collar contracts: Volume (Barrels) 315,000 855,000 1,170,000 Price per Barrel Average Ceiling $77.85 $77.98 $77.94 Average Floor $55.00 $55.00 $55.00 None of the Company's derivative contracts were designated as cash flow hedges. The aggregate fair value of the Company's derivative instruments reported in the accompanying consolidated balance sheets by type, including the classification between assets and liabilities, consists of the following: Type Consolidated Balance Sheet Location Fair Value Gross Amounts Offset in the Consolidated Balance Sheet Net Fair Value Presented in the Consolidated Balance Sheet (in thousands) Successor Fair Value of Derivative Instruments as of September 30, 2018 Asset Derivatives: Natural gas price derivatives Derivative Financial Instruments – current $18 $ (18 ) $ — Liability Derivatives: Natural gas price derivatives Derivative Financial Instruments – current $854 $ (18 ) 836 Crude oil price derivatives Derivative Financial Instruments – current $2,013 $ — 2,013 $ 2,849 Predecessor Fair Value of Derivative Instruments as of December 31, 2017 Asset Derivatives: Natural gas price derivatives Derivative Financial Instruments – current $1,318 $ — $ 1,318 The Company recognized cash settlements and changes in the fair value of its derivative financial instruments as a single component of other income (expenses). Gains and losses Successor Predecessor Predecessor Successor Predecessor Predecessor Location of Gain/(Loss) Recognized in Earnings on Derivatives For the Period from August 14, 2018 through September 30, 2018 For the Period from July 1, 2018 through August 13, 2018 Three Months Ended September 30, 2017 For the Period from August 14, 2018 through September 30, 2018 For the Period from January 1, 2018 through August 13, 2018 Nine Months Ended September 30, 2017 (In thousands) Gain (loss) from derivative financial instruments $ (2,015 ) $ (83 ) $ 1,430 $ (2,015 ) $ 881 $ 14,585 Stock-Based Compensation Comstock accounts for employee stock-based compensation under the fair value method. Compensation cost is measured at the grant date based on the fair value of the award and is recognized over the award vesting period. The Company recognized $0.3 million of stock-based compensation expense within general and administrative expenses related to awards of restricted stock and performance stock units ("PSUs") to its employees and directors during the Successor period August 14, 2018 through September 30, 2018 and $0.8 million during the predecessor period July 1 through August 13, 2018. For the predecessor periods of the three and nine months ended September 30, 2017, the Company recognized $1.7 million and $4.5 million, respectively, of stock-based compensation expense. During the period July 1, 2018 through August 13, 2018, the Predecessor Company granted 100,226 shares of restricted stock with a grant date fair value of $0.9 million, or $8.73 per share, to its independent directors. The change of control that occurred due to the Jones Contribution resulting in the vesting of all then outstanding restricted stock grants of 904,181 shares. During the successor period August 14, 2018 through September 30, 2018, the Company granted 422,545 shares of restricted stock with a grant date fair value of $3.7 million, or $8.70 per share, to its employees. The fair value of each restricted share on the date of grant was equal to its market price. Total unrecognized compensation cost related to unvested restricted stock grants of $3.5 million as of September 30, 2018 is expected to be recognized over a period of 2.9 years. The change of control that occurred due to the Jones Contribution also resulted in the vesting of all then outstanding performance share units at the maximum amount that could be earned, and a total of 1,028,672 shares of common stock were issued to employees. During the successor period August 14, 2018 through September 30, 2018, the Company granted 335,545 PSUs with a grant date fair value of $4.3 million, or $12.93 per unit, to its employees, all of which were outstanding as of September 30, 2018. The number of shares of common stock to be issued related to the PSUs is based on the Company's stock price performance as compared to its peers which could result in the issuance of anywhere from zero to 671,090 shares of common stock. Total unrecognized compensation cost related to these grants of $4.2 million as of September 30, 2018 is expected to be recognized over a period of 2.9 years. Revenue Recognition On January 1, 2018, the Company adopted Financial Accounting Standards Board ("FASB") Accounting Standards Update ("ASU") 2014-09, Revenue from Contracts with Customers (Topic 606) Comstock adopted this standard using the modified retrospective method of adoption, and it applied the ASU only to contracts that were not completed as of January 1, 2018. Upon adoption, there were no adjustments to the opening balance of equity. Comstock produces oil and natural gas and reports revenues separately for each of these two primary products in its statements of operations. Revenues are recognized upon the transfer of produced volumes to the Company's customers, who take control of the volumes and receive all the benefits of ownership upon delivery at designated sales points. Payment is reasonably assured upon delivery of production. All sales are subject to contracts that have commercial substance, contain specific pricing terms, and define the enforceable rights and obligations of both parties. These contracts typically provide for cash settlement within 25 days following each production month and are cancellable upon 30 days' notice by either party. Prices for sales of oil and natural gas are generally based upon terms that are common in the oil and gas industry, including index or spot prices, location and quality differentials, as well as market supply and demand conditions. As a result, prices for oil and natural gas routinely fluctuate based on changes in these factors. Each unit of production (barrel of crude oil and thousand cubic feet of natural gas) represents a separate performance obligation under the Company's contracts since each unit has economic benefit on its own and each is priced separately according to the terms of the contracts. Comstock has elected to exclude all taxes from the measurement of transaction prices, and its revenues are reported net of royalties and exclude revenue interests owned by others because the Company acts as an agent when selling crude oil and natural gas, on behalf of royalty owners and working interest owners. Revenue is recorded in the month of production based on an estimate of the Company's share of volumes produced and prices realized. The Company recognizes any differences between estimates and actual amounts received in the month when payment is received. Historically, differences between estimated revenues and actual revenue received have not been significant. The amount of oil or natural gas sold may differ from the amount to which the Company is entitled based on its revenue interests in the properties. The Company did not have any significant imbalance positions at December 31, 2017 or September 30, 2018. Sales of oil and natural gas generally occur at or near the wellhead. When sales of oil and gas occur at locations other than the wellhead, the Company accounts for costs incurred to transport the production to the delivery point as gathering and transportation expenses. The Company has recognized accounts receivable of $61.0 million as of September 30, 2018 from customers for contracts where performance obligations have been satisfied and an unconditional right to consideration exists. Income Taxes Deferred income taxes are provided to reflect the future tax consequences or benefits of differences between the tax basis of assets and liabilities and their reported amounts in the financial statements using enacted tax rates. In recording deferred income tax assets, the Company considers whether it is more likely than not that some portion or all of its deferred income tax assets will be realized in the future. The ultimate realization of deferred income tax assets is dependent upon the generation of future taxable income during the periods in which those deferred income tax assets would be deductible. The Company believes that, after considering all the available objective evidence, historical and prospective, with greater weight given to historical evidence, management is not able to determine that it is more likely than not that all of its deferred tax assets will be realized. As a result, the Company established valuation allowances for its deferred tax assets and U.S. federal and state net operating loss carryforwards that are not expected to be utilized due to the uncertainty of generating taxable income prior to the expiration of the carryforward periods. The following is an analysis of consolidated income tax provision (benefit): Three Months ended September 30, Nine Months ended September 30, Transition Period Transition Period Successor Predecessor Predecessor Successor Predecessor Predecessor For the Period from August 14, 2018 through September 30, 2018 For the Period from July 1, 2018 through August 13, 2018 2017 For the Period from August 14, 2018 through September 30, 2018 For the Period from January 1, 2018 through August 13, 2018 2017 (In thousands) Current - State $ 57 $ (22 ) $ 18 $ 57 $ 13 $ 115 - Federal — — — — — — Deferred - State 20 (309 ) (87 ) 20 (1,360 ) 768 - Federal 3,863 936 — 3,863 2,412 — $ 3,940 $ 605 $ (69 ) $ 3,940 $ 1,065 $ 883 The difference between the Company's effective tax rate and the 21% federal statutory rate in effect in 2018 and the 35% rate in effect in 2017 is caused by valuation allowances on deferred taxes and state taxes. The impact of these items varies based upon the Company's projected full year loss and the jurisdictions that are expected to generate the projected losses. The difference between the federal statutory rate and the effective tax rate is due to the following: Three Months ended September 30, Nine Months ended September 30, Transition Period Transition Period Successor Predecessor Predecessor Successor Predecessor Predecessor For the Period from August 14, 2018 through September 30, 2018 For the Period from July 1, 2018 through August 13, 2018 2017 For the Period from August 14, 2018 through September 30, 2018 For the Period from January 1, 2018 through August 13, 2018 2017 (In thousands) Tax at statutory rate 21.0 % 21.0 % 35.0 % 21.0% 21.0 % 35.0 % Tax effect of: State income taxes, net of federal benefit 2.0 4.5 3.8 2.0 3.9 4.1 Valuation allowance on deferred tax assets (0.6 ) (21.1 ) (37.8 ) (0.6 ) (24.1 ) (39.2 ) Nondeductible stock-based compensation (0.2 ) (0.7 ) (0.7 ) (0.2 ) (0.7 ) (1.1 ) Other — (7.4 ) — — (1.3 ) (0.1 ) Effective tax rate 22.2 % (3.7 )% 0.3 % 22.2 % (1.2 )% (1.3 )% The Tax Cuts and Jobs Act, which was enacted on December 22, 2017, reduced the corporate income tax rate effective January 1, 2018 from 35% to 21%. Among the other significant tax law changes that potentially affect the Company are the elimination of the corporate alternative minimum tax ("AMT"), changes that require operating losses incurred in 2018 and beyond be carried forward indefinitely with no carryback up to 80% of taxable income in a given year, and limitations on the deduction for interest expense incurred in 2018 or later for amounts in excess of 30% of its adjusted taxable income (defined as taxable income before interest and net operating losses). For tax years beginning before January 1, 2022, the adjusted taxable income for these purposes is also adjusted to exclude the impact of depreciation, depletion and amortization. The Tax Cuts and Jobs Act preserved deductibility of intangible drilling costs for federal income tax purposes, which allows the Company to deduct a portion of drilling costs in the year incurred and minimizes current taxes payable in periods of taxable income. At September 30, 2018, the Company has not completed its accounting for the tax effects of enactment of the Tax Cuts and Jobs Act; however, it has made reasonable estimates of the effects on its existing deferred tax balances. The Company has remeasured certain deferred federal tax assets and liabilities based on the rates at which they are expected to reverse in the future, which is generally 21%. The provisional amount recognized at December 31, 2017 related to the remeasurement of its deferred federal tax balance was $140.4 million, which was subject to a valuation allowance. The Tax Cuts and Jobs Act also repealed the AMT for tax years beginning on or after January 1, 2018 and provides that existing AMT credit carryforwards can be utilized to offset federal taxes for any taxable year. In addition, 50% of any unused AMT credit carryforwards can be refunded during tax years 2018 through 2020. The Company reclassified $19.1 million to a non-current receivable at December 31, 2017 representing the amount of AMT that is now refundable through 2021. The Company is still analyzing certain aspects of the Tax Cuts and Jobs Act, and refining its calculations, which could potentially affect the measurement of those balances or potentially give rise to new deferred tax amounts. Comstock's estimates may also be affected in the future as the Company gains a more thorough understanding of the Tax Cuts and Jobs Act, and how the individual states are implementing this new law. The shares of common stock issued as a result of the Jones Transaction triggered an ownership change under Section 382 of the Internal Revenue Code. As a result, Comstock's ability to use net operating losses ("NOLs") to reduce taxable income is generally limited to an annual amount based on the fair market value of its stock immediately prior to the ownership change multiplied by the long-term tax-exempt interest rate. The Company's NOLs are estimated to be limited to $3.3 million a year as a result of this limitation. In addition to this limitation, IRC Section 382 provides that a corporation with a net unrealized built-in gain immediately before an ownership change may increase its limitation by the amount of recognized built-in gain recognized during a recognition period, which is generally the five-year period immediately following an ownership change. Based on the fair mar |
Long-Term Debt
Long-Term Debt | 9 Months Ended |
Sep. 30, 2018 | |
Debt Disclosure [Abstract] | |
Long-Term Debt | (2) LONG-TERM DEBT – At September 30, 2018, long-term debt was comprised of the following: (In thousands) 9¾% Senior Notes due 2026: Principal $ 850,000 Discount, net of amortization (33,650 ) Bank Credit Facility Principal 450,000 Debt issuance costs, net of amortization (23,506 ) $ 1,242,844 In connection with the Jones Contribution, the Company completed a series of refinancing transactions in which it completed a private placement of $850.0 million of new unsecured 9¾% Senior Notes due 2026 and entered into a new bank credit facility with an initial borrowing base of $700.0 million. The Company utilized the net proceeds from the notes offering, $450.0 million of borrowings under the new bank credit agreement and cash on hand to retire all of its other then-outstanding senior secured and unsecured notes. The senior notes placement closed on August 3, 2018. Interest on the notes is payable at an annual rate of 9¾% on February 15 and August 15 and the notes mature on August 15, 2026. On August 14, 2018, the Company entered into a new bank credit facility with Bank of Montreal, as administrative agent, and the participating banks. The bank credit facility is subject to a borrowing base, which is initially $700.0 million and is re-determined on a semi-annual basis and upon the occurrence of certain other events, and will mature on August 14, 2023. As of September 30, 2018, there were $450.0 million of borrowings outstanding under the revolving credit facility. Borrowings under the bank credit facility are secured by substantially all of the assets of the Company and its subsidiaries. and bear interest at the Company's option, at either LIBOR plus 2.0% to 3.0% or a base rate plus 1.0% to 2.0%, in each case depending on the utilization of the borrowing base. The Company also pays a commitment fee of 0.375% to 0.5% on the unused borrowing base. The bank credit facility places certain restrictions upon the Company's, and its restricted subsidiaries', ability to, among other things, incur additional indebtedness, pay cash dividends, repurchase common stock, make certain loans, investments and divestitures and redeem the new senior notes. The only financial covenants are the maintenance of a leverage ratio of less than 4.0 to 1.0 and a current ratio of at least 1.0 to 1.0 beginning with the three months ended December 31, 2018. |
Stockholders' Equity
Stockholders' Equity | 9 Months Ended |
Sep. 30, 2018 | |
Equity [Abstract] | |
Stockholders' Equity | (3) STOCKHOLDERS' EQUITY – At the annual meeting of stockholders held August 10, 2018 the stockholders approved an increase in the authorized capital for the Company to a total of 160,000,000 shares, of which 155,000,000 shares are common stock, par value $0.50, and 5,000,000 shares, are preferred stock, par value $10.00. Upon the closing of the Jones Contribution, the Company issued 88,571,429 shares of common stock to the Jones Partnerships. As of September 30, 2018, all of the previously outstanding warrants to purchase shares of common stock at an exercise price of $0.01 per share were exercised or expired. Warrants for 402,708 and 246,793 shares of common stock were exercised during the nine months ended September |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2018 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | (4) Commitments and Contingencies – From time to time, Comstock is involved in certain litigation that arises in the normal course of its operations. The Company records a loss contingency for these matters when it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated. The Company does not believe the resolution of any of these matters will have a material effect on the Company's financial position or results of operations. The Company has entered into natural gas transportation and treating agreements through July 2019. Maximum commitments under these transportation agreements as of September 30, 2018 totaled $1.0 million. As of September |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2018 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation These unaudited consolidated financial statements include the accounts of Comstock and its wholly-owned subsidiaries. The accompanying unaudited consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and disclosures normally included in annual financial statements prepared in accordance with accounting principles generally accepted in the United States have been omitted pursuant to those rules and regulations, although Comstock believes that the disclosures made are adequate to make the information presented not misleading. These unaudited consolidated financial statements should be read in conjunction with the financial statements and notes thereto included in Comstock's Annual Report on Form 10-K for the year ended December 31, 2017. The results of operations for the Predecessor and Successor periods up to and through September 30, 2018 are not necessarily an indication of the results expected for the full year. On August 14, 2018, Arkoma Drilling, L.P. and Williston Drilling, L.P. (collectively, the "Jones Partnerships") contributed certain oil and gas properties in North Dakota and Montana (the "Bakken Shale Properties") in exchange for common stock representing 84% of the Company's outstanding common stock (the "Jones Contribution"). The Jones Partnerships are wholly owned and controlled by Dallas businessman Jerry Jones and his children (collectively, the "Jones Group"). The Jones Partnerships received 88,571,429 newly issued shares of common stock based on an agreed upon share price of $7.00 per share. The Company assessed the Bakken Shale Properties to determine whether they meet the definition of a business under US generally accepted accounting principles, determining that they do not meet the definition of a business. As a result, the Jones Contribution is not being accounted for as a business combination. Upon the issuance of the shares of Comstock common stock, the Jones Group obtained control over Comstock through their ownership of the Jones Partnerships. Through the Jones Partnerships, the Jones Group owns a majority of the voting common stock as well as the ability to control the composition of the majority of the board of directors of Comstock. As a result of the change of control that occurred upon the issuance of the common stock, the Jones Group controls Comstock and, thereby, continues to control the Bakken Shale Properties. Accordingly, the basis of the Bakken Shale Properties recognized by Comstock is the historical basis of the Jones Group. The historical cost basis of the Bakken Shale properties contributed was $397.6 million, which was comprised of $554.3 million of capitalized costs less $156.7 million of accumulated depletion, depreciation and amortization. The change in control of Comstock results in a new basis for Comstock as the company has elected to apply pushdown accounting pursuant to ASC 805, Business Combinations. The new basis is pushed down to Comstock for financial reporting purposes, resulting in Comstock's assets, liabilities and equity accounts being recognized at fair value upon the closing of the Jones Transactions. References to "Successor" or "Successor Company" relate to the financial position and results of operations of the Company subsequent to August 13, 2018. Reference to "Predecessor" or "Predecessor Company" relate to the financial position and results of operations of the Company on or prior to August 13, 2018. The Company's consolidated financial statements and related footnotes are presented with a black line division which delineates the lack of comparability between amounts presented after August 13, 2018 and dates prior thereto. |
Property and Equipment | Property and Equipment The Company follows the successful efforts method of accounting for its oil and gas properties. Costs incurred to acquire oil and gas leasehold are capitalized. On April 27, 2018, Comstock completed the sale of its producing Eagle Ford shale oil and gas properties in McMullen, LaSalle, Frio, Atascosa, Wilson, and Karnes counties, Texas for $125.0 million. The sale was effective November 1, 2017 and the estimated net cash flow from the properties from November 2017 to April 2018 was paid to the buyer at closing. After the sale, the Company had approximately 8,400 net undeveloped acres that are prospective for Eagle Ford shale development. During the predecessor period January 1, 2018 through August 13, 2018, the Company recognized a loss on sale of oil and gas properties of Results of operations for properties that were sold were as follows: Predecessor Predecessor Predecessor Three Months Ended September 30, 2017 For the Period from January 1, 2018 through August 13, 2018 Nine Months Ended September 30, 2017 Total oil and gas sales $ 11,079 $ 17,747 $ 36,495 Total operating expenses (1) (11,664 ) (6,134 ) (38,262 ) Operating income (loss) $ (585 ) $ 11,613 $ (1,767 ) (1) On July 31, 2018, the Company acquired oil and gas properties in North Louisiana and Texas for $39.3 million. These properties consist of approximately 23,000 gross acres (12,000 net) and include 120 (26.2 net) producing natural gas wells, 49 (14.7 net) which produce from the Haynesville shale. All of the acreage acquired is held by production. Comstock has identified 112 (31.0 net) potential drilling locations on this acreage of which 21 (17.9 net) would be operated by Comstock. On August 14, 2018, in connection with the Jones Contribution, the strategic drilling venture previously entered into by the Company and Arkoma Drilling, LP was terminated and Comstock re-acquired working interests in wells drilled under the joint venture for $17.9 million representing the costs paid by Arkoma Drilling, LP. The Company assesses the need for an impairment of the capitalized costs for its proved oil and gas properties on a property basis. No impairments were recognized to adjust the carrying value of the Company's proved oil and gas properties during any of the periods presented. Unproved oil and gas properties are also periodically assessed and any impairment in value is charged to expense. The costs of unproved properties are transferred to oil and gas properties and amortized on an equivalent unit-of-production basis as wells are drilled on these properties. The Company determines the fair values of its oil and gas properties using a discounted cash flow model and proved and risk-adjusted probable oil and natural gas reserves. Undrilled acreage can also be valued based on sales transactions in comparable areas. Significant Level 3 assumptions associated with the calculation of discounted future cash flows included in the cash flow model include management's outlook for oil and natural gas prices, production costs, capital expenditures, and future production as well as estimated proved oil and gas reserves and risk-adjusted probable oil and natural gas reserves. Management's oil and natural gas price outlook is developed based on third-party longer-term price forecasts as of each measurement date. The expected future net cash flows are discounted using an appropriate discount rate in determining a property's fair value. It is reasonably possible that the Company's estimates of undiscounted future net cash flows attributable to its oil and gas properties may change in the future. The primary factors that may affect estimates of future cash flows include future adjustments, both positive and negative, to proved and appropriate risk-adjusted probable oil and gas reserves, results of future drilling activities, future prices for oil and natural gas, and increases or decreases in production and capital costs. As a result of these changes, there may be future impairments in the carrying values of these or other properties. |
Goodwill | Goodwill Goodwill represents the excess of purchase price over fair value of net tangible and identifiable intangible assets related to the Jones Transactions. The Company is not required to amortize goodwill as a charge to earnings; however, the Company is required to conduct an annual review of goodwill for impairment. The Company will perform its first annual review of goodwill impairment starting on October 1, 2019. The Company has goodwill of $349.7 million as of September 30, 2018 that was recorded in connection with the Jones Contribution. |
Accrued Expenses | Accrued Expenses Accrued expenses at September 30, 2018 and December 31, 2017 consist of the following: Successor Predecessor As of As of (In thousands) Accrued drilling costs $ 18,811 $ 5,874 Accrued interest payable 14,328 21,277 Accrued transportation costs 5,022 3,269 Accrued employee compensation 3,841 6,449 Accrued ad valorem taxes 5,021 — Accrued lease operating expenses 3,311 68 Asset retirement obligation – assets held for sale — 4,557 Other 2,927 961 $ 53,261 $ 42,455 |
Reserve for Future Abandonment Costs | Reserve for Future Abandonment Costs Comstock's asset retirement obligations relate to future plugging and abandonment expenses on its oil and gas properties and related facilities disposal. The following table summarizes the changes in Comstock's total estimated liability for such obligations during the periods presented: Successor Predecessor Predecessor For the Period from August 14, 2018 through September 30, 2018 For the Period from January 1, 2018 through August 13, 2018 Nine Months Ended September 30, 2017 (In thousands) Future abandonment costs — beginning of period $ 4,683 $ 10,407 $ 15,804 Accretion expense 45 346 645 New wells placed on production 10 17 5 Liabilities settled and assets disposed of — (87 ) (356 ) Future abandonment costs — end of period $ 4,738 $ 10,683 $ 16,098 |
Derivative Financial Instruments and Hedging Activities | Derivative Financial Instruments and Hedging Activities All of the Company's derivative financial instruments are used for risk management purposes and, by policy, none are held for trading or speculative purposes. Comstock minimizes credit risk to counterparties of its derivative financial instruments through formal credit policies, monitoring procedures, and diversification. The Company is not required to provide any credit support to its counterparties other than cross collateralization with the assets securing its bank credit facility. None of the Company's derivative financial instruments involve payment or receipt of premiums. The Company classifies the fair value amounts of derivative financial instruments as net current or noncurrent assets or liabilities, whichever the case may be, by commodity and counterparty. All of Comstock's natural gas derivative financial instruments are tied to the Henry Hub-NYMEX price index and all of its crude oil derivative financial instruments are tied to the WTI-NYMEX index price. The Company had the following outstanding derivative financial instruments for natural gas price risk management at September 30, 2018: Future Production Period Three Months Ending December 31, 2018 Year Ending December 31, 2019 Total Natural Gas Swap contracts: Volume (MMbtu) 5,400,000 4,200,000 9,600,000 Average Price per MMbtu $3.00 $3.00 $3.00 Natural Gas Collar contracts: Volume (MMbtu) 6,300,000 13,200,000 19,500,000 Price per MMbtu Average Ceiling $3.40 $3.40 $3.40 Average Floor $2.50 $2.50 $2.50 Crude Oil Collar contracts: Volume (Barrels) 315,000 855,000 1,170,000 Price per Barrel Average Ceiling $77.85 $77.98 $77.94 Average Floor $55.00 $55.00 $55.00 None of the Company's derivative contracts were designated as cash flow hedges. The aggregate fair value of the Company's derivative instruments reported in the accompanying consolidated balance sheets by type, including the classification between assets and liabilities, consists of the following: Type Consolidated Balance Sheet Location Fair Value Gross Amounts Offset in the Consolidated Balance Sheet Net Fair Value Presented in the Consolidated Balance Sheet (in thousands) Successor Fair Value of Derivative Instruments as of September 30, 2018 Asset Derivatives: Natural gas price derivatives Derivative Financial Instruments – current $18 $ (18 ) $ — Liability Derivatives: Natural gas price derivatives Derivative Financial Instruments – current $854 $ (18 ) 836 Crude oil price derivatives Derivative Financial Instruments – current $2,013 $ — 2,013 $ 2,849 Predecessor Fair Value of Derivative Instruments as of December 31, 2017 Asset Derivatives: Natural gas price derivatives Derivative Financial Instruments – current $1,318 $ — $ 1,318 The Company recognized cash settlements and changes in the fair value of its derivative financial instruments as a single component of other income (expenses). Gains and losses Successor Predecessor Predecessor Successor Predecessor Predecessor Location of Gain/(Loss) Recognized in Earnings on Derivatives For the Period from August 14, 2018 through September 30, 2018 For the Period from July 1, 2018 through August 13, 2018 Three Months Ended September 30, 2017 For the Period from August 14, 2018 through September 30, 2018 For the Period from January 1, 2018 through August 13, 2018 Nine Months Ended September 30, 2017 (In thousands) Gain (loss) from derivative financial instruments $ (2,015 ) $ (83 ) $ 1,430 $ (2,015 ) $ 881 $ 14,585 |
Stock-Based Compensation | Stock-Based Compensation Comstock accounts for employee stock-based compensation under the fair value method. Compensation cost is measured at the grant date based on the fair value of the award and is recognized over the award vesting period. The Company recognized $0.3 million of stock-based compensation expense within general and administrative expenses related to awards of restricted stock and performance stock units ("PSUs") to its employees and directors during the Successor period August 14, 2018 through September 30, 2018 and $0.8 million during the predecessor period July 1 through August 13, 2018. For the predecessor periods of the three and nine months ended September 30, 2017, the Company recognized $1.7 million and $4.5 million, respectively, of stock-based compensation expense. During the period July 1, 2018 through August 13, 2018, the Predecessor Company granted 100,226 shares of restricted stock with a grant date fair value of $0.9 million, or $8.73 per share, to its independent directors. The change of control that occurred due to the Jones Contribution resulting in the vesting of all then outstanding restricted stock grants of 904,181 shares. During the successor period August 14, 2018 through September 30, 2018, the Company granted 422,545 shares of restricted stock with a grant date fair value of $3.7 million, or $8.70 per share, to its employees. The fair value of each restricted share on the date of grant was equal to its market price. Total unrecognized compensation cost related to unvested restricted stock grants of $3.5 million as of September 30, 2018 is expected to be recognized over a period of 2.9 years. The change of control that occurred due to the Jones Contribution also resulted in the vesting of all then outstanding performance share units at the maximum amount that could be earned, and a total of 1,028,672 shares of common stock were issued to employees. During the successor period August 14, 2018 through September 30, 2018, the Company granted 335,545 PSUs with a grant date fair value of $4.3 million, or $12.93 per unit, to its employees, all of which were outstanding as of September 30, 2018. The number of shares of common stock to be issued related to the PSUs is based on the Company's stock price performance as compared to its peers which could result in the issuance of anywhere from zero to 671,090 shares of common stock. Total unrecognized compensation cost related to these grants of $4.2 million as of September 30, 2018 is expected to be recognized over a period of 2.9 years. |
Revenue Recognition | Revenue Recognition On January 1, 2018, the Company adopted Financial Accounting Standards Board ("FASB") Accounting Standards Update ("ASU") 2014-09, Revenue from Contracts with Customers (Topic 606) Comstock adopted this standard using the modified retrospective method of adoption, and it applied the ASU only to contracts that were not completed as of January 1, 2018. Upon adoption, there were no adjustments to the opening balance of equity. Comstock produces oil and natural gas and reports revenues separately for each of these two primary products in its statements of operations. Revenues are recognized upon the transfer of produced volumes to the Company's customers, who take control of the volumes and receive all the benefits of ownership upon delivery at designated sales points. Payment is reasonably assured upon delivery of production. All sales are subject to contracts that have commercial substance, contain specific pricing terms, and define the enforceable rights and obligations of both parties. These contracts typically provide for cash settlement within 25 days following each production month and are cancellable upon 30 days' notice by either party. Prices for sales of oil and natural gas are generally based upon terms that are common in the oil and gas industry, including index or spot prices, location and quality differentials, as well as market supply and demand conditions. As a result, prices for oil and natural gas routinely fluctuate based on changes in these factors. Each unit of production (barrel of crude oil and thousand cubic feet of natural gas) represents a separate performance obligation under the Company's contracts since each unit has economic benefit on its own and each is priced separately according to the terms of the contracts. Comstock has elected to exclude all taxes from the measurement of transaction prices, and its revenues are reported net of royalties and exclude revenue interests owned by others because the Company acts as an agent when selling crude oil and natural gas, on behalf of royalty owners and working interest owners. Revenue is recorded in the month of production based on an estimate of the Company's share of volumes produced and prices realized. The Company recognizes any differences between estimates and actual amounts received in the month when payment is received. Historically, differences between estimated revenues and actual revenue received have not been significant. The amount of oil or natural gas sold may differ from the amount to which the Company is entitled based on its revenue interests in the properties. The Company did not have any significant imbalance positions at December 31, 2017 or September 30, 2018. Sales of oil and natural gas generally occur at or near the wellhead. When sales of oil and gas occur at locations other than the wellhead, the Company accounts for costs incurred to transport the production to the delivery point as gathering and transportation expenses. The Company has recognized accounts receivable of $61.0 million as of September 30, 2018 from customers for contracts where performance obligations have been satisfied and an unconditional right to consideration exists. |
Income Taxes | Income Taxes Deferred income taxes are provided to reflect the future tax consequences or benefits of differences between the tax basis of assets and liabilities and their reported amounts in the financial statements using enacted tax rates. In recording deferred income tax assets, the Company considers whether it is more likely than not that some portion or all of its deferred income tax assets will be realized in the future. The ultimate realization of deferred income tax assets is dependent upon the generation of future taxable income during the periods in which those deferred income tax assets would be deductible. The Company believes that, after considering all the available objective evidence, historical and prospective, with greater weight given to historical evidence, management is not able to determine that it is more likely than not that all of its deferred tax assets will be realized. As a result, the Company established valuation allowances for its deferred tax assets and U.S. federal and state net operating loss carryforwards that are not expected to be utilized due to the uncertainty of generating taxable income prior to the expiration of the carryforward periods. The following is an analysis of consolidated income tax provision (benefit): Three Months ended September 30, Nine Months ended September 30, Transition Period Transition Period Successor Predecessor Predecessor Successor Predecessor Predecessor For the Period from August 14, 2018 through September 30, 2018 For the Period from July 1, 2018 through August 13, 2018 2017 For the Period from August 14, 2018 through September 30, 2018 For the Period from January 1, 2018 through August 13, 2018 2017 (In thousands) Current - State $ 57 $ (22 ) $ 18 $ 57 $ 13 $ 115 - Federal — — — — — — Deferred - State 20 (309 ) (87 ) 20 (1,360 ) 768 - Federal 3,863 936 — 3,863 2,412 — $ 3,940 $ 605 $ (69 ) $ 3,940 $ 1,065 $ 883 The difference between the Company's effective tax rate and the 21% federal statutory rate in effect in 2018 and the 35% rate in effect in 2017 is caused by valuation allowances on deferred taxes and state taxes. The impact of these items varies based upon the Company's projected full year loss and the jurisdictions that are expected to generate the projected losses. The difference between the federal statutory rate and the effective tax rate is due to the following: Three Months ended September 30, Nine Months ended September 30, Transition Period Transition Period Successor Predecessor Predecessor Successor Predecessor Predecessor For the Period from August 14, 2018 through September 30, 2018 For the Period from July 1, 2018 through August 13, 2018 2017 For the Period from August 14, 2018 through September 30, 2018 For the Period from January 1, 2018 through August 13, 2018 2017 (In thousands) Tax at statutory rate 21.0 % 21.0 % 35.0 % 21.0% 21.0 % 35.0 % Tax effect of: State income taxes, net of federal benefit 2.0 4.5 3.8 2.0 3.9 4.1 Valuation allowance on deferred tax assets (0.6 ) (21.1 ) (37.8 ) (0.6 ) (24.1 ) (39.2 ) Nondeductible stock-based compensation (0.2 ) (0.7 ) (0.7 ) (0.2 ) (0.7 ) (1.1 ) Other — (7.4 ) — — (1.3 ) (0.1 ) Effective tax rate 22.2 % (3.7 )% 0.3 % 22.2 % (1.2 )% (1.3 )% The Tax Cuts and Jobs Act, which was enacted on December 22, 2017, reduced the corporate income tax rate effective January 1, 2018 from 35% to 21%. Among the other significant tax law changes that potentially affect the Company are the elimination of the corporate alternative minimum tax ("AMT"), changes that require operating losses incurred in 2018 and beyond be carried forward indefinitely with no carryback up to 80% of taxable income in a given year, and limitations on the deduction for interest expense incurred in 2018 or later for amounts in excess of 30% of its adjusted taxable income (defined as taxable income before interest and net operating losses). For tax years beginning before January 1, 2022, the adjusted taxable income for these purposes is also adjusted to exclude the impact of depreciation, depletion and amortization. The Tax Cuts and Jobs Act preserved deductibility of intangible drilling costs for federal income tax purposes, which allows the Company to deduct a portion of drilling costs in the year incurred and minimizes current taxes payable in periods of taxable income. At September 30, 2018, the Company has not completed its accounting for the tax effects of enactment of the Tax Cuts and Jobs Act; however, it has made reasonable estimates of the effects on its existing deferred tax balances. The Company has remeasured certain deferred federal tax assets and liabilities based on the rates at which they are expected to reverse in the future, which is generally 21%. The provisional amount recognized at December 31, 2017 related to the remeasurement of its deferred federal tax balance was $140.4 million, which was subject to a valuation allowance. The Tax Cuts and Jobs Act also repealed the AMT for tax years beginning on or after January 1, 2018 and provides that existing AMT credit carryforwards can be utilized to offset federal taxes for any taxable year. In addition, 50% of any unused AMT credit carryforwards can be refunded during tax years 2018 through 2020. The Company reclassified $19.1 million to a non-current receivable at December 31, 2017 representing the amount of AMT that is now refundable through 2021. The Company is still analyzing certain aspects of the Tax Cuts and Jobs Act, and refining its calculations, which could potentially affect the measurement of those balances or potentially give rise to new deferred tax amounts. Comstock's estimates may also be affected in the future as the Company gains a more thorough understanding of the Tax Cuts and Jobs Act, and how the individual states are implementing this new law. The shares of common stock issued as a result of the Jones Transaction triggered an ownership change under Section 382 of the Internal Revenue Code. As a result, Comstock's ability to use net operating losses ("NOLs") to reduce taxable income is generally limited to an annual amount based on the fair market value of its stock immediately prior to the ownership change multiplied by the long-term tax-exempt interest rate. The Company's NOLs are estimated to be limited to $3.3 million a year as a result of this limitation. In addition to this limitation, IRC Section 382 provides that a corporation with a net unrealized built-in gain immediately before an ownership change may increase its limitation by the amount of recognized built-in gain recognized during a recognition period, which is generally the five-year period immediately following an ownership change. Based on the fair market value of the Company's common stock immediately prior to the ownership change, Comstock believes that it has a net unrealized built-in gain which will increase the Section 382 limitation during the five-year recognition period. NOLs that exceed the Section 382 limitation in any year continue to be allowed as carry forwards until they expire and can be used to offset taxable income for years within the carryover period subject to the limitation in each year. NOLs incurred prior to 2018 generally have a 20-year life until they expire. NOLs generated in 2018 and after would be carried forward indefinitely. Comstock's use of new NOLs arising after the date of an ownership change would not be affected by the 382 limitation. If the Company does not generate a sufficient level of taxable income prior to the expiration of the pre-2018 NOL carry forward periods, then it will lose the ability to apply those NOLs as offsets to future taxable income. The Company's federal income tax returns for the years subsequent to December 31, 2014 remain subject to examination. The Company's income tax returns in major state income tax jurisdictions remain subject to examination for various periods subsequent to December 31, 2012. The Company currently believes that all other significant filing positions are highly certain and that all of its other significant income tax positions and deductions would be sustained under audit or the final resolution would not have a material effect on the consolidated financial statements. Therefore, the Company has not established any significant reserves for uncertain tax positions. |
Fair Value Measurements | Fair Value Measurements The Company holds or has held certain financial assets and liabilities that are required to be measured at fair value. These include cash and cash equivalents held in bank accounts and derivative financial instruments in the form of oil and natural gas price swap agreements. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. A three-level hierarchy is followed for disclosure to show the extent and level of judgment used to estimate fair value measurements: Level 1 — Inputs used to measure fair value are unadjusted quoted prices that are available in active markets for the identical assets or liabilities as of the reporting date. Level 2 — Inputs used to measure fair value, other than quoted prices included in Level 1, are either directly or indirectly observable as of the reporting date through correlation with market data, including quoted prices for similar assets and liabilities in active markets and quoted prices in markets that are not active. Level 2 also includes assets and liabilities that are valued using models or other pricing methodologies that do not require significant judgment since the input assumptions used in the models, such as interest rates and volatility factors, are corroborated by readily observable data from actively quoted markets for substantially the full term of the financial instrument. Level 3 — Inputs used to measure fair value are unobservable inputs that are supported by little or no market activity and reflect the use of significant management judgment. These values are generally determined using pricing models for which the assumptions utilize management's estimates of market participant assumptions. The Company's cash and cash equivalents valuation is based on Level 1 measurements. The Company's oil and natural gas price swap agreements and its natural gas price collars were not traded on a public exchange, and their value is determined utilizing a discounted cash flow model based on inputs that are readily available in public markets and, accordingly, the valuation of these swap agreements, is categorized as a Level 2 measurement. There are no financial assets or liabilities accounted for at fair value as of September 30, 2018 that are a Level 3 measurement. At September 30, 2018, the Company had a liability of $2.8 million recorded for the fair value of its oil and natural gas swaps and collars. At December 31, 2017, the Company had assets recorded for the fair value of its natural gas price swap agreements of $1.3 million. There were no offsetting swap positions in 2018 or 2017. The change in fair value of these natural gas swaps and collars was recognized as a gain or loss and included as a component of other income (expense). As of September 30, 2018, the Company's fixed rate debt had a carrying value of $816.3 million and a fair value of $850.0 million. The fair value of the Company's fixed rate debt was based on quoted prices as of September 30, 2018, a Level 2 measurement. The fair value of the floating rate debt outstanding approximated its carrying value, a Level 2 measurement. |
Earnings Per Share | Earnings Per Share Unvested share-based payment awards containing nonforfeitable rights to dividends are considered to be participating securities and included in the computation of basic and diluted earnings per share pursuant to the two-class method. PSUs represent the right to receive a number of shares of the Company's common stock that may range from zero to up to two times the number of PSUs granted on the award date based on the achievement of certain performance measures during a performance period. The number of potentially dilutive shares related to PSUs is based on the number of shares, if any, which would be issuable at the end of the respective period, assuming that date was the end of the contingency period. The treasury stock method is used to measure the dilutive effect of PSUs. Basic and diluted income (loss) per share were determined as follows: Successor For the Period from August 14, 2018 Income Shares Per (In thousands, except per share amounts) Net income attributable to common stock $ 13,823 Income allocable to unvested restricted shares (51 ) Basic income attributable to common stock 13,772 105,448 $ 0.13 Effect of Dilutive Securities: Income allocable to unvested restricted shares — 15 Diluted income attributable to common stock 13,772 105,463 $ 0.13 Predecessor For the Period from July 1, 2018 Three Months Ended September 30, 2017 Loss Shares Per Loss Shares Per (In thousands, except per share amounts) Basic and diluted net loss attributable $ (16,865 ) 15,468 $ (1.09 ) $ (24,736 ) 14,796 $ (1.67 ) Predecessor For the Period from January 1, 2018 Nine Months Ended September 30, 2017 Loss Shares Per Loss Shares Per (In thousands, except per share amounts) Basic and diluted net loss attributable $ (92,754 ) 15,262 $ (6.08 ) $ (69,109 ) 14,591 $ (4.74 ) Basic and diluted per share amounts are the same for the predecessor periods due to the net loss in those periods. At September 30, 2018 and December 31, 2017, 422,545 and 619,867 shares of restricted stock, respectively, are included in common stock outstanding as such shares have a nonforfeitable right to participate in any dividends that might be declared and have the right to vote on matters submitted to the Company's stockholders. Weighted average shares of unvested restricted stock outstanding were as follows: Three Months ended September 30, Nine Months ended September 30, Successor Predecessor Predecessor Successor Predecessor Predecessor For the Period from August 14, 2018 through September 30, 2018 For the Period from July 1, 2018 through August 13, 2018 2017 For the Period from August 14, 2018 through September 30, 2018 For the Period from January 1, 2018 through August 13, 2018 2017 (In thousands) Unvested restricted stock 396 813 666 396 839 612 All unvested PSUs, warrants exercisable into common stock and contingently issuable shares related to the convertible debt that would be dilutive in the computation of earnings per share were as follows: Three Months ended September 30, Nine Months ended September 30, Successor Predecessor Predecessor Successor Predecessor Predecessor For the Period from August 14, 2018 through September 30, 2018 For the Period from July 1, 2018 through August 13, 2018 2017 For the Period from August 14, 2018 through September 30, 2018 For the Period from January 1, 2018 through August 13, 2018 2017 (In thousands except per share/unit data) Weighted average warrants for common 15 42 415 15 142 479 Weighted average exercise price per share $ 0.01 $ 0.01 $ 0.01 $ 0.01 $ 0.01 $ 0.01 Weighted average PSUs 315 514 303 315 476 281 Weighted average grant date fair value per unit $ 12.93 $ 13.83 $ 17.12 $ 12.93 $ 13.83 $ 17.12 Weighted average contingently convertible shares — 40,631 37,624 — 39,819 36,676 Weighted average conversion price per share $ — $ 12.32 $ 12.32 $ — $ 12.32 $ 12.32 All restricted shares, warrants, PSUs and potentially dilutive shares from conversion of senior notes in the Predecessor periods presented were anti-dilutive and excluded from the computation of loss per share. |
Supplementary Information With Respect to the Consolidated Statements of Cash Flows | Supplementary Information With Respect to the Consolidated Statements of Cash Flows For the purpose of the consolidated statements of cash flows, the Company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents. Cash payments made for interest and income taxes for the nine months ended September 30, 2018 and 2017, respectively, were as follows: Successor Predecessor Predecessor For the Period from August 14, 2018 through September 30, 2018 For the Period from January 1, 2018 through August 13, 2018 Nine Months Ended September 30, 2017 (In thousands) Interest payments $ 1,999 $ 36,187 $ 72,913 Income tax payments $ — $ 2 $ 3 Interest paid in-kind related to the Predecessor Company's convertible notes was $25.0 million during the period January 1, 2018 through August 13, 2018 and $28.2 million during the nine months ended September 30, 2017. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In January 2017, the FASB issued Accounting Standards Update No. 2017-04 (ASU 2017-04) “Intangibles-Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment.” ASU 2017-04 eliminates step two of the goodwill impairment test and specifies that goodwill impairment should be measured by comparing the fair value of a reporting unit with its carrying amount. ASU 2017-04 is effective for annual or interim goodwill impairment tests performed in fiscal years beginning after December 15, 2019 and early adoption is permitted. The Company has initially recognized goodwill in its financial statements for the quarter ended September 30, 2018 and it will assess the impact of ASU 2017-04 on its financial statements when it performs its initial annual impairment assessment. On January 1, 2018, the Company adopted ASU 2014-09, which supersedes nearly all existing revenue recognition guidance under existing generally accepted accounting principles. This new standard is based upon the principal that revenue is recognized to depict the transfer of goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. ASU 2014-09 also requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. Comstock adopted this standard using the modified retrospective method of adoption and it applied the ASU only to contracts that were not completed as of January 1, 2018. Upon adoption, there were no adjustments to the opening balance of equity and the Company does not expect the standard to have a significant effect on its results of operations, liquidity or financial position. In February 2016, the FASB issued ASU No. 2016-02, Leases |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Accounting Policies [Abstract] | |
Summary of Estimated Fair Value of Assets and Liabilities and Resulting Goodwill | The estimated fair value of Comstock's assets and liabilities and the resulting goodwill at the date of the transaction were as follows: (In thousands) Fair Value of Comstock's common stock $ 149,357 Fair Value of Liabilities Assumed — Current Liabilities 180,452 Long-Term Debt 2,059,560 Deferred Income Taxes 63,708 Reserve for Future Abandonment Costs 4,440 Net Liabilities Assumed 2,308,160 Fair Value of Assets Acquired — Current Assets 936,026 Oil and Gas Properties 1,147,749 Other Property & Equipment 4,440 Income Taxes Receivable 19,086 Other Assets 549 Total Assets 2,107,850 Goodwill $ 349,667 |
Summary of Unaudited Pro Forma Financial Information | The unaudited pro forma financial information presented below sets forth the Company's historical statements of operations for the periods indicated and gives effect to the Jones Contribution and the Company's debt refinancing transactions as if "push down" accounting had been applied as of January 1, 2017. Such information is presented for comparative purposes to the Consolidated Statements of Operations only and does not purport to represent what the Company's results of operations would actually have been had these transactions occurred on the date indicated or to project its results of operations for any future period or date. Pro Forma Nine Months Ended September 30, 2018 (1) 2017 Revenues: Natural gas sales $ 196,049 $ 158,679 Oil sales 194,328 159,812 Total oil and gas sales 390,377 318,491 Operating expenses: Production taxes 22,168 16,722 Gathering and transportation 15,291 12,428 Lease operating 44,103 43,309 Depreciation, depletion and amortization 132,234 148,100 General and administrative 19,319 19,134 Loss on sale of oil and gas properties 35,340 1,060 Total operating expenses 268,455 240,753 Operating income 121,922 77,738 Other income (expenses): Gain (loss) from derivative financial instruments (1,134 ) 14,585 Other income 719 398 Interest expense (80,437 ) (89,063 ) Total other income (80,852 ) (74,080 ) Income before income taxes 41,070 3,658 Benefit from (provision for) income taxes (10,818 ) (2,211 ) Net Income $ 30,252 $ 1,447 Net income per share – basic and diluted $ 0.29 $ 0.01 Weighted average shares outstanding – Basic 105,448 105,095 Diluted 105,463 105,574 (1) |
Results of Operations for Properties | Results of operations for properties that were sold were as follows: Predecessor Predecessor Predecessor Three Months Ended September 30, 2017 For the Period from January 1, 2018 through August 13, 2018 Nine Months Ended September 30, 2017 Total oil and gas sales $ 11,079 $ 17,747 $ 36,495 Total operating expenses (1) (11,664 ) (6,134 ) (38,262 ) Operating income (loss) $ (585 ) $ 11,613 $ (1,767 ) |
Summary of Accrued Expenses | Accrued expenses at September 30, 2018 and December 31, 2017 consist of the following: Successor Predecessor As of As of (In thousands) Accrued drilling costs $ 18,811 $ 5,874 Accrued interest payable 14,328 21,277 Accrued transportation costs 5,022 3,269 Accrued employee compensation 3,841 6,449 Accrued ad valorem taxes 5,021 — Accrued lease operating expenses 3,311 68 Asset retirement obligation – assets held for sale — 4,557 Other 2,927 961 $ 53,261 $ 42,455 |
Summary of Changes in Reserve for Future Abandonment Costs | The following table summarizes the changes in Comstock's total estimated liability for such obligations during the periods presented: Successor Predecessor Predecessor For the Period from August 14, 2018 through September 30, 2018 For the Period from January 1, 2018 through August 13, 2018 Nine Months Ended September 30, 2017 (In thousands) Future abandonment costs — beginning of period $ 4,683 $ 10,407 $ 15,804 Accretion expense 45 346 645 New wells placed on production 10 17 5 Liabilities settled and assets disposed of — (87 ) (356 ) Future abandonment costs — end of period $ 4,738 $ 10,683 $ 16,098 |
Schedule of Gas Derivative Contracts Volume and Prices | The Company had the following outstanding derivative financial instruments for natural gas price risk management at September 30, 2018: Future Production Period Three Months Ending December 31, 2018 Year Ending December 31, 2019 Total Natural Gas Swap contracts: Volume (MMbtu) 5,400,000 4,200,000 9,600,000 Average Price per MMbtu $3.00 $3.00 $3.00 Natural Gas Collar contracts: Volume (MMbtu) 6,300,000 13,200,000 19,500,000 Price per MMbtu Average Ceiling $3.40 $3.40 $3.40 Average Floor $2.50 $2.50 $2.50 Crude Oil Collar contracts: Volume (Barrels) 315,000 855,000 1,170,000 Price per Barrel Average Ceiling $77.85 $77.98 $77.94 Average Floor $55.00 $55.00 $55.00 |
Schedule of Derivative Instruments | None of the Company's derivative contracts were designated as cash flow hedges. The aggregate fair value of the Company's derivative instruments reported in the accompanying consolidated balance sheets by type, including the classification between assets and liabilities, consists of the following: Type Consolidated Balance Sheet Location Fair Value Gross Amounts Offset in the Consolidated Balance Sheet Net Fair Value Presented in the Consolidated Balance Sheet (in thousands) Successor Fair Value of Derivative Instruments as of September 30, 2018 Asset Derivatives: Natural gas price derivatives Derivative Financial Instruments – current $18 $ (18 ) $ — Liability Derivatives: Natural gas price derivatives Derivative Financial Instruments – current $854 $ (18 ) 836 Crude oil price derivatives Derivative Financial Instruments – current $2,013 $ — 2,013 $ 2,849 Predecessor Fair Value of Derivative Instruments as of December 31, 2017 Asset Derivatives: Natural gas price derivatives Derivative Financial Instruments – current $1,318 $ — $ 1,318 |
Schedule of Gains and Losses from Derivative Financial Instruments | Gains and losses Successor Predecessor Predecessor Successor Predecessor Predecessor Location of Gain/(Loss) Recognized in Earnings on Derivatives For the Period from August 14, 2018 through September 30, 2018 For the Period from July 1, 2018 through August 13, 2018 Three Months Ended September 30, 2017 For the Period from August 14, 2018 through September 30, 2018 For the Period from January 1, 2018 through August 13, 2018 Nine Months Ended September 30, 2017 (In thousands) Gain (loss) from derivative financial instruments $ (2,015 ) $ (83 ) $ 1,430 $ (2,015 ) $ 881 $ 14,585 |
Consolidated Income Tax Provision (Benefit) | The following is an analysis of consolidated income tax provision (benefit): Three Months ended September 30, Nine Months ended September 30, Transition Period Transition Period Successor Predecessor Predecessor Successor Predecessor Predecessor For the Period from August 14, 2018 through September 30, 2018 For the Period from July 1, 2018 through August 13, 2018 2017 For the Period from August 14, 2018 through September 30, 2018 For the Period from January 1, 2018 through August 13, 2018 2017 (In thousands) Current - State $ 57 $ (22 ) $ 18 $ 57 $ 13 $ 115 - Federal — — — — — — Deferred - State 20 (309 ) (87 ) 20 (1,360 ) 768 - Federal 3,863 936 — 3,863 2,412 — $ 3,940 $ 605 $ (69 ) $ 3,940 $ 1,065 $ 883 |
Difference Between Federal Statutory Rate and Effective Tax Rate | The difference between the Company's effective tax rate and the 21% federal statutory rate in effect in 2018 and the 35% rate in effect in 2017 is caused by valuation allowances on deferred taxes and state taxes. The impact of these items varies based upon the Company's projected full year loss and the jurisdictions that are expected to generate the projected losses. The difference between the federal statutory rate and the effective tax rate is due to the following: Three Months ended September 30, Nine Months ended September 30, Transition Period Transition Period Successor Predecessor Predecessor Successor Predecessor Predecessor For the Period from August 14, 2018 through September 30, 2018 For the Period from July 1, 2018 through August 13, 2018 2017 For the Period from August 14, 2018 through September 30, 2018 For the Period from January 1, 2018 through August 13, 2018 2017 (In thousands) Tax at statutory rate 21.0 % 21.0 % 35.0 % 21.0% 21.0 % 35.0 % Tax effect of: State income taxes, net of federal benefit 2.0 4.5 3.8 2.0 3.9 4.1 Valuation allowance on deferred tax assets (0.6 ) (21.1 ) (37.8 ) (0.6 ) (24.1 ) (39.2 ) Nondeductible stock-based compensation (0.2 ) (0.7 ) (0.7 ) (0.2 ) (0.7 ) (1.1 ) Other — (7.4 ) — — (1.3 ) (0.1 ) Effective tax rate 22.2 % (3.7 )% 0.3 % 22.2 % (1.2 )% (1.3 )% |
Basic and Diluted Income (Loss) Per Share | Basic and diluted income (loss) per share were determined as follows: Successor For the Period from August 14, 2018 Income Shares Per (In thousands, except per share amounts) Net income attributable to common stock $ 13,823 Income allocable to unvested restricted shares (51 ) Basic income attributable to common stock 13,772 105,448 $ 0.13 Effect of Dilutive Securities: Income allocable to unvested restricted shares — 15 Diluted income attributable to common stock 13,772 105,463 $ 0.13 Predecessor For the Period from July 1, 2018 Three Months Ended September 30, 2017 Loss Shares Per Loss Shares Per (In thousands, except per share amounts) Basic and diluted net loss attributable $ (16,865 ) 15,468 $ (1.09 ) $ (24,736 ) 14,796 $ (1.67 ) Predecessor For the Period from January 1, 2018 Nine Months Ended September 30, 2017 Loss Shares Per Loss Shares Per (In thousands, except per share amounts) Basic and diluted net loss attributable $ (92,754 ) 15,262 $ (6.08 ) $ (69,109 ) 14,591 $ (4.74 ) |
Weighted Average Shares of Unvested Restricted Stock | Weighted average shares of unvested restricted stock outstanding were as follows: Three Months ended September 30, Nine Months ended September 30, Successor Predecessor Predecessor Successor Predecessor Predecessor For the Period from August 14, 2018 through September 30, 2018 For the Period from July 1, 2018 through August 13, 2018 2017 For the Period from August 14, 2018 through September 30, 2018 For the Period from January 1, 2018 through August 13, 2018 2017 (In thousands) Unvested restricted stock 396 813 666 396 839 612 |
Common Stock and Convertible Stock Dilutive in Computation of Earning Per Share | All unvested PSUs, warrants exercisable into common stock and contingently issuable shares related to the convertible debt that would be dilutive in the computation of earnings per share were as follows: Three Months ended September 30, Nine Months ended September 30, Successor Predecessor Predecessor Successor Predecessor Predecessor For the Period from August 14, 2018 through September 30, 2018 For the Period from July 1, 2018 through August 13, 2018 2017 For the Period from August 14, 2018 through September 30, 2018 For the Period from January 1, 2018 through August 13, 2018 2017 (In thousands except per share/unit data) Weighted average warrants for common 15 42 415 15 142 479 Weighted average exercise price per share $ 0.01 $ 0.01 $ 0.01 $ 0.01 $ 0.01 $ 0.01 Weighted average PSUs 315 514 303 315 476 281 Weighted average grant date fair value per unit $ 12.93 $ 13.83 $ 17.12 $ 12.93 $ 13.83 $ 17.12 Weighted average contingently convertible shares — 40,631 37,624 — 39,819 36,676 Weighted average conversion price per share $ — $ 12.32 $ 12.32 $ — $ 12.32 $ 12.32 |
Cash Payments Made for Interest and Income Taxes | Cash payments made for interest and income taxes for the nine months ended September 30, 2018 and 2017, respectively, were as follows: Successor Predecessor Predecessor For the Period from August 14, 2018 through September 30, 2018 For the Period from January 1, 2018 through August 13, 2018 Nine Months Ended September 30, 2017 (In thousands) Interest payments $ 1,999 $ 36,187 $ 72,913 Income tax payments $ — $ 2 $ 3 |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Debt Disclosure [Abstract] | |
Long-term Debt | At September 30, 2018, long-term debt was comprised of the following: (In thousands) 9¾% Senior Notes due 2026: Principal $ 850,000 Discount, net of amortization (33,650 ) Bank Credit Facility Principal 450,000 Debt issuance costs, net of amortization (23,506 ) $ 1,242,844 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Additional Information 1 (Detail) | Aug. 14, 2018USD ($)$ / shares$ / bbl$ / Mcfshares | Aug. 13, 2018USD ($) | Jul. 31, 2018USD ($)aWellLocation | Apr. 27, 2018USD ($) | Sep. 30, 2018USD ($)a | Aug. 13, 2018USD ($) | Sep. 30, 2018USD ($)a | Sep. 30, 2017USD ($) | Aug. 13, 2018USD ($) | Aug. 13, 2018USD ($) | Sep. 30, 2018USD ($)a$ / bbl$ / Mcf | Sep. 30, 2017USD ($) |
Operations And Summary Of Significant Accounting Policies [Line Items] | ||||||||||||
Jones contribution transaction, ownership percentage | 84.00% | |||||||||||
Jones contribution transaction, Shares issued | shares | 88,571,429 | |||||||||||
Jones contribution transaction, share price | $ / shares | $ 7 | |||||||||||
Purchase price allocation period | 12 months | |||||||||||
Success fee for contribution transaction | $ 8,100,000 | $ 8,100,000 | $ 8,100,000 | $ 8,100,000 | ||||||||
Recognized stock-based compensation expense | 7,200,000 | |||||||||||
Unrecognized stock-based compensation expense | 11,900,000 | 11,900,000 | 11,900,000 | 11,900,000 | ||||||||
Jones contribution transaction | $ 36,365,000 | 43,200,000 | ||||||||||
Deferred tax liability adjustment to additional paid-in capital | $ 77,900,000 | |||||||||||
Deferred tax liability related to tax basis of long-lived assets | $ 52,400,000 | 52,400,000 | 52,400,000 | |||||||||
Loss on sale of oil and gas properties | (98,000) | |||||||||||
Working interests re-acquired under the joint venture | $ 17,900,000 | |||||||||||
Impairment of oil and gas properties | 0 | |||||||||||
Goodwill | 349,667,000 | 349,667,000 | 349,667,000 | $ 349,667,000 | ||||||||
Annual goodwill impairment test, description | The Company will perform its first annual review of goodwill impairment starting on October 1, 2019. | |||||||||||
Cash flow hedges derivative instruments | $ 0 | $ 0 | $ 0 | |||||||||
Predecessor | ||||||||||||
Operations And Summary Of Significant Accounting Policies [Line Items] | ||||||||||||
Transaction-related costs | 2,600,000 | |||||||||||
Loss on sale of oil and gas properties | $ 1,060,000 | 35,438,000 | $ 1,060,000 | |||||||||
Loss resulting from final settlement for property sale | 2,700,000 | |||||||||||
Impairment of oil and gas properties | 0 | $ 0 | 0 | $ 0 | ||||||||
Predecessor | North Louisiana and Texas Properties | ||||||||||||
Operations And Summary Of Significant Accounting Policies [Line Items] | ||||||||||||
Acquired oil and gas properties | $ 39,300,000 | |||||||||||
Oil and gas properties, gross acres | a | 23,000 | |||||||||||
Oil and gas properties, net acres | a | 12,000 | |||||||||||
Producing natural gas wells, gross | Well | 120 | |||||||||||
Producing natural gas wells, net | Well | 26.2 | |||||||||||
Producing Haynesville shale natural gas wells, gross | Well | 49 | |||||||||||
Producing Haynesville shale natural gas wells, net | Well | 14.7 | |||||||||||
Potential drilling locations, gross | Location | 112 | |||||||||||
Potential drilling locations, net | Location | 31 | |||||||||||
Potential operated drilling locations, gross | Location | 21 | |||||||||||
Potential operated drilling locations, net | Location | 17.9 | |||||||||||
Predecessor | South Texas Sold Properties | ||||||||||||
Operations And Summary Of Significant Accounting Policies [Line Items] | ||||||||||||
Gross proceeds from sale of oil and gas properties | $ 125,000,000 | |||||||||||
Effective date of sale | Nov. 1, 2017 | |||||||||||
Bakken Shale Properties | ||||||||||||
Operations And Summary Of Significant Accounting Policies [Line Items] | ||||||||||||
Oil and gas property cost basis | 397,600,000 | |||||||||||
Oil and gas property capitalized costs | 554,300,000 | |||||||||||
Oil and gas property accumulated depletion, depreciation and amortization | $ 156,700,000 | |||||||||||
Goodwill Oil and Gas Property Valuation | ||||||||||||
Operations And Summary Of Significant Accounting Policies [Line Items] | ||||||||||||
Management's oil price outlook | $ / bbl | 79.72 | |||||||||||
Management's gas price outlook | $ / Mcf | 3.87 | |||||||||||
Annual minimum discount rate | 10.00% | |||||||||||
Annual maximum discount rate | 25.00% | |||||||||||
South Texas Asset Held for Sale | ||||||||||||
Operations And Summary Of Significant Accounting Policies [Line Items] | ||||||||||||
Management's oil price outlook | $ / bbl | 72.03 | |||||||||||
Management's gas price outlook | $ / Mcf | 4.31 | |||||||||||
Annual minimum discount rate | 20.00% | |||||||||||
Annual maximum discount rate | 25.00% | |||||||||||
Undeveloped Acres | a | 8,400 | 8,400 | 8,400 | |||||||||
Proceeds from sale of undeveloped acreage | $ 13,700,000 | |||||||||||
South Texas Asset Held for Sale | Predecessor | ||||||||||||
Operations And Summary Of Significant Accounting Policies [Line Items] | ||||||||||||
Assets held for sale, fair value | $ 55,000,000 | $ 55,000,000 | $ 55,000,000 | 55,000,000 | ||||||||
Loss on sale of oil and gas properties | $ 32,700,000 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Summary of Estimated Fair Value of Assets and Liabilities and Resulting Goodwill (Detail) - USD ($) $ in Thousands | Sep. 30, 2018 | Aug. 14, 2018 |
Jones Contribution And Refinancing Plans [Abstract] | ||
Fair Value of Comstock's common stock | $ 149,357 | |
Fair Value of Liabilities Assumed — | ||
Current Liabilities | 180,452 | |
Long-Term Debt | 2,059,560 | |
Deferred Income Taxes | 63,708 | |
Reserve for Future Abandonment Costs | 4,440 | |
Net Liabilities Assumed | 2,308,160 | |
Fair Value of Assets Acquired — | ||
Current Assets | 936,026 | |
Oil and Gas Properties | 1,147,749 | |
Other Property & Equipment | 4,440 | |
Income Taxes Receivable | 19,086 | |
Other Assets | 549 | |
Total Assets | 2,107,850 | |
Goodwill | $ 349,667 | $ 349,667 |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies - Summary of Unaudited Pro Forma Financial Information (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 1 Months Ended | 2 Months Ended | 3 Months Ended | 9 Months Ended | ||
Aug. 13, 2018 | Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | [1] | Sep. 30, 2017 | |
Revenues: | ||||||
Total oil and gas sales | $ 70,123 | |||||
Operating expenses: | ||||||
Production taxes | 4,051 | |||||
Gathering and transportation | 3,450 | |||||
Lease operating | 7,016 | |||||
Depreciation, depletion and amortization | 17,820 | |||||
General and administrative | 3,303 | |||||
Loss (gain) on sale of oil and gas properties | (98) | |||||
Total operating expenses | 35,542 | |||||
Operating income | 34,581 | |||||
Other income (expenses): | ||||||
Gain (loss) from derivative financial instruments | (2,015) | |||||
Other income | 42 | |||||
Interest expense | (14,845) | |||||
Total other income (expenses) | (16,818) | |||||
Income (loss) before income taxes | 17,763 | |||||
Benefit from (provision for) income taxes | (3,940) | |||||
Net income (loss) | $ 13,823 | |||||
Net income (loss) per share – basic and diluted | $ (1.09) | $ 0.13 | $ (1.67) | |||
Weighted average shares outstanding – | ||||||
Basic | 105,448 | |||||
Diluted | 105,463 | |||||
Natural Gas Sales | ||||||
Revenues: | ||||||
Total oil and gas sales | $ 36,393 | |||||
Oil Sales | ||||||
Revenues: | ||||||
Total oil and gas sales | $ 33,730 | |||||
Pro Forma | ||||||
Revenues: | ||||||
Total oil and gas sales | $ 390,377 | $ 318,491 | ||||
Operating expenses: | ||||||
Production taxes | 22,168 | 16,722 | ||||
Gathering and transportation | 15,291 | 12,428 | ||||
Lease operating | 44,103 | 43,309 | ||||
Depreciation, depletion and amortization | 132,234 | 148,100 | ||||
General and administrative | 19,319 | 19,134 | ||||
Loss (gain) on sale of oil and gas properties | 35,340 | 1,060 | ||||
Total operating expenses | 268,455 | 240,753 | ||||
Operating income | 121,922 | 77,738 | ||||
Other income (expenses): | ||||||
Gain (loss) from derivative financial instruments | (1,134) | 14,585 | ||||
Other income | 719 | 398 | ||||
Interest expense | (80,437) | (89,063) | ||||
Total other income (expenses) | (80,852) | (74,080) | ||||
Income (loss) before income taxes | 41,070 | 3,658 | ||||
Benefit from (provision for) income taxes | (10,818) | (2,211) | ||||
Net income (loss) | $ 30,252 | $ 1,447 | ||||
Net income (loss) per share – basic and diluted | $ 0.29 | $ 0.01 | ||||
Weighted average shares outstanding – | ||||||
Basic | 105,448 | 105,095 | ||||
Diluted | 105,463 | 105,574 | ||||
Pro Forma | Natural Gas Sales | ||||||
Revenues: | ||||||
Total oil and gas sales | $ 196,049 | $ 158,679 | ||||
Pro Forma | Oil Sales | ||||||
Revenues: | ||||||
Total oil and gas sales | $ 194,328 | $ 159,812 | ||||
[1] | Excludes $2.6 million of transaction costs associated with the Jones Contribution. |
Summary of Significant Accoun_7
Summary of Significant Accounting Policies - Summary of Unaudited Pro Forma Financial Information (Parenthetical) (Detail) $ in Millions | 9 Months Ended |
Sep. 30, 2018USD ($) | |
Pro Forma | |
Transaction-related costs | $ 2.6 |
Summary of Significant Accoun_8
Summary of Significant Accounting Policies - Results of Operations for Properties (Detail) - Predecessor - USD ($) $ in Thousands | 3 Months Ended | 7 Months Ended | 9 Months Ended | |
Sep. 30, 2017 | Aug. 13, 2018 | Sep. 30, 2017 | ||
Operations And Summary Of Significant Accounting Policies [Line Items] | ||||
Total oil and gas sales | $ 11,079 | $ 17,747 | $ 36,495 | |
Total operating expenses | [1] | (11,664) | (6,134) | (38,262) |
Operating income (loss) | $ (585) | $ 11,613 | $ (1,767) | |
[1] | Includes direct operating expenses, depreciation, depletion and amortization and exploration expense and excludes interest and general and administrative expense. No depreciation, depletion and amortization expense has been provided for subsequent to the date the assets were designated as held for sale. |
Summary of Significant Accoun_9
Summary of Significant Accounting Policies - Summary of Accrued Expenses (Detail) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Accrued Liabilities, Current [Abstract] | ||
Accrued drilling costs | $ 18,811 | |
Accrued interest payable | 14,328 | |
Accrued transportation costs | 5,022 | |
Accrued employee compensation | 3,841 | |
Accrued ad valorem taxes | 5,021 | |
Accrued lease operating expenses | 3,311 | |
Other | 2,927 | |
Total accrued expenses | $ 53,261 | |
Predecessor | ||
Accrued Liabilities, Current [Abstract] | ||
Accrued drilling costs | $ 5,874 | |
Accrued interest payable | 21,277 | |
Accrued transportation costs | 3,269 | |
Accrued employee compensation | 6,449 | |
Accrued lease operating expenses | 68 | |
Asset retirement obligation – assets held for sale | 4,557 | |
Other | 961 | |
Total accrued expenses | $ 42,455 |
Summary of Significant Accou_10
Summary of Significant Accounting Policies - Summary of Changes in Reserve for Future Abandonment Costs (Detail) - USD ($) $ in Thousands | 2 Months Ended | 7 Months Ended | 9 Months Ended |
Sep. 30, 2018 | Aug. 13, 2018 | Sep. 30, 2017 | |
Asset Retirement Obligations Noncurrent [Abstract] | |||
Future abandonment costs — beginning of period | $ 4,683 | ||
Accretion expense | 45 | ||
New wells placed on production | 10 | ||
Future abandonment costs — end of period | 4,738 | $ 4,683 | |
Predecessor | |||
Asset Retirement Obligations Noncurrent [Abstract] | |||
Future abandonment costs — beginning of period | $ 10,683 | 10,407 | $ 15,804 |
Accretion expense | 346 | 645 | |
New wells placed on production | 17 | 5 | |
Liabilities settled and assets disposed of | (87) | (356) | |
Future abandonment costs — end of period | $ 10,683 | $ 16,098 |
Summary of Significant Accou_11
Summary of Significant Accounting Policies - Schedule of Gas Derivative Contracts Volume and Prices (Detail) | Sep. 30, 2018MMBTUbbl$ / bbl$ / MMBTU |
Natural Gas Contracts, in MMBTU | Swap Contracts for Q4 | |
Derivative [Line Items] | |
Volume, MMBTU | MMBTU | 5,400,000 |
Average price per MMBtu in usd | 3 |
Natural Gas Contracts, in MMBTU | Swap Contracts for 2019 | |
Derivative [Line Items] | |
Volume, MMBTU | MMBTU | 4,200,000 |
Average price per MMBtu in usd | 3 |
Natural Gas Contracts, in MMBTU | Swap Contracts | |
Derivative [Line Items] | |
Volume, MMBTU | MMBTU | 9,600,000 |
Average price per MMBtu in usd | 3 |
Natural Gas Contracts, in MMBTU | Collar Contracts for Q4 | |
Derivative [Line Items] | |
Volume, MMBTU | MMBTU | 6,300,000 |
Ceiling, Average price per MMBTU | 3.40 |
Floor, Average price per MMBTU | 2.50 |
Natural Gas Contracts, in MMBTU | Swap Contracts for 2019 | |
Derivative [Line Items] | |
Volume, MMBTU | MMBTU | 13,200,000 |
Ceiling, Average price per MMBTU | 3.40 |
Floor, Average price per MMBTU | 2.50 |
Natural Gas Contracts, in MMBTU | Collar Contracts | |
Derivative [Line Items] | |
Volume, MMBTU | MMBTU | 19,500,000 |
Ceiling, Average price per MMBTU | 3.40 |
Floor, Average price per MMBTU | 2.50 |
Crude Oil Contracts, in Barrels | Collar Contracts for Q4 | |
Derivative [Line Items] | |
Volume, MMBTU | bbl | 315,000 |
Ceiling, Average price per MMBTU | $ / bbl | 77.85 |
Floor, Average price per MMBTU | $ / bbl | 55 |
Crude Oil Contracts, in Barrels | Swap Contracts for 2019 | |
Derivative [Line Items] | |
Volume, MMBTU | bbl | 855,000 |
Ceiling, Average price per MMBTU | $ / bbl | 77.98 |
Floor, Average price per MMBTU | $ / bbl | 55 |
Crude Oil Contracts, in Barrels | Collar Contracts | |
Derivative [Line Items] | |
Volume, MMBTU | bbl | 1,170,000 |
Ceiling, Average price per MMBTU | $ / bbl | 77.94 |
Floor, Average price per MMBTU | $ / bbl | 55 |
Summary of Significant Accou_12
Summary of Significant Accounting Policies - Schedule of Derivative Instruments (Detail) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Derivative [Line Items] | ||
Net Fair Value Presented in the Consolidated Balance Sheet, Liabilities Derivatives - current | $ 2,849 | |
Predecessor | ||
Derivative [Line Items] | ||
Net Fair Value Presented in the Consolidated Balance Sheet, Asset Derivatives - current | $ 1,318 | |
Natural Gas Price Derivatives | Derivative Financial Instruments – Current | ||
Derivative [Line Items] | ||
Asset Derivatives, Fair Value | 18 | |
Gross Amounts Offset in the Consolidated Balance Sheet, Assets Derivatives | (18) | |
Net Fair Value Presented in the Consolidated Balance Sheet, Asset Derivatives - current | 0 | |
Liability Derivatives, Fair Value | 854 | |
Gross Amounts Offset in the Consolidated Balance Sheet, Liabilities Derivatives | (18) | |
Net Fair Value Presented in the Consolidated Balance Sheet, Liabilities Derivatives - current | 836 | |
Natural Gas Price Derivatives | Predecessor | Derivative Financial Instruments – Current | ||
Derivative [Line Items] | ||
Asset Derivatives, Fair Value | 1,318 | |
Gross Amounts Offset in the Consolidated Balance Sheet, Assets Derivatives | 0 | |
Net Fair Value Presented in the Consolidated Balance Sheet, Asset Derivatives - current | $ 1,318 | |
Crude Oil Price Derivatives | Derivative Financial Instruments – Current | ||
Derivative [Line Items] | ||
Liability Derivatives, Fair Value | 2,013 | |
Net Fair Value Presented in the Consolidated Balance Sheet, Liabilities Derivatives - current | $ 2,013 |
Summary of Significant Accou_13
Summary of Significant Accounting Policies - Schedule of Gains and Losses from Derivative Financial Instruments (Detail) - USD ($) $ in Thousands | 1 Months Ended | 2 Months Ended | 3 Months Ended | 7 Months Ended | 9 Months Ended |
Aug. 13, 2018 | Sep. 30, 2018 | Sep. 30, 2017 | Aug. 13, 2018 | Sep. 30, 2017 | |
Derivative [Line Items] | |||||
Gain (loss) from derivative financial instruments | $ (2,015) | ||||
Predecessor | |||||
Derivative [Line Items] | |||||
Gain (loss) from derivative financial instruments | $ (83) | $ 1,430 | $ 881 | $ 14,585 | |
Gain (Loss) from Derivative Financial Instruments | Natural Gas Price Derivatives | |||||
Derivative [Line Items] | |||||
Gain (loss) from derivative financial instruments | $ (2,015) | ||||
Gain (Loss) from Derivative Financial Instruments | Natural Gas Price Derivatives | Predecessor | |||||
Derivative [Line Items] | |||||
Gain (loss) from derivative financial instruments | $ (83) | $ 1,430 | $ 881 | $ 14,585 |
Summary of Significant Accou_14
Summary of Significant Accounting Policies - Additional Information 2 (Detail) $ / shares in Units, $ in Thousands | 1 Months Ended | 2 Months Ended | 3 Months Ended | 7 Months Ended | 9 Months Ended | ||
Aug. 13, 2018USD ($)$ / sharesshares | Sep. 30, 2018USD ($)Unit$ / shares$ / EquityUnitshares | Sep. 30, 2017USD ($) | Aug. 13, 2018USD ($)shares | Sep. 30, 2018USD ($)Productshares | Sep. 30, 2017USD ($) | Dec. 31, 2017shares | |
Operations And Summary Of Significant Accounting Policies [Line Items] | |||||||
Stock-based compensation expense recognized | $ 329 | ||||||
Number of primary products | Product | 2 | ||||||
Contract cash settlement max days | 25 days | ||||||
Contract cancellable notice term | 30 days | ||||||
Accounts Receivable related to satisfied performance obligations and unconditional right to consideration | $ 61,000 | $ 61,000 | |||||
Restricted Stock | |||||||
Operations And Summary Of Significant Accounting Policies [Line Items] | |||||||
Number of shares granted | shares | 422,545 | ||||||
Restricted stock grant date fair value | $ 3,700 | ||||||
Grant date fair value of share units, per share | $ / shares | $ 8.70 | ||||||
Shares of unvested restricted stock outstanding | shares | 422,545 | 422,545 | |||||
Unrecognized compensation cost related to unvested restricted stock | $ 3,500 | $ 3,500 | |||||
Period in which compensation cost expected to be recognized | 2 years 10 months 24 days | ||||||
Potential Performance Shares (PSU) | |||||||
Operations And Summary Of Significant Accounting Policies [Line Items] | |||||||
Shares of unvested restricted stock outstanding | shares | 1,028,672 | 1,028,672 | |||||
Period in which compensation cost expected to be recognized | 2 years 10 months 24 days | ||||||
Number of units granted | Unit | 335,545 | ||||||
Performance share units grant date fair value | $ 4,300 | ||||||
Grant date fair value of share units, per unit | $ / EquityUnit | 12.93 | ||||||
Minimum final number of shares of common stock issuable based on performance multiplier | shares | 0 | ||||||
Maximum final number of shares of common stock issuable based on performance multiplier | shares | 671,090 | ||||||
Unrecognized expense, performance share units | $ 4,200 | ||||||
Predecessor | |||||||
Operations And Summary Of Significant Accounting Policies [Line Items] | |||||||
Stock-based compensation expense recognized | $ 3,912 | $ 4,455 | |||||
Predecessor | Restricted Stock | |||||||
Operations And Summary Of Significant Accounting Policies [Line Items] | |||||||
Number of shares granted | shares | 100,226 | ||||||
Restricted stock grant date fair value | $ 900 | ||||||
Grant date fair value of share units, per share | $ / shares | $ 8.73 | ||||||
Shares of unvested restricted stock outstanding | shares | 904,181 | 904,181 | 619,867 | ||||
General and Administrative Expense | |||||||
Operations And Summary Of Significant Accounting Policies [Line Items] | |||||||
Stock-based compensation expense recognized | $ 300 | ||||||
General and Administrative Expense | Predecessor | |||||||
Operations And Summary Of Significant Accounting Policies [Line Items] | |||||||
Stock-based compensation expense recognized | $ 800 | $ 1,700 | $ 4,500 |
Summary of Significant Accou_15
Summary of Significant Accounting Policies - Consolidated Income Tax Provision (Benefit) (Detail) - USD ($) $ in Thousands | 1 Months Ended | 2 Months Ended | 3 Months Ended | 7 Months Ended | 9 Months Ended |
Aug. 13, 2018 | Sep. 30, 2018 | Sep. 30, 2017 | Aug. 13, 2018 | Sep. 30, 2017 | |
Income Tax Expense Benefit From Continuing Operations [Line Items] | |||||
Current - State | $ 57 | ||||
Deferred - State | 20 | ||||
Deferred - Federal | 3,863 | ||||
Total | $ 3,940 | ||||
Predecessor | |||||
Income Tax Expense Benefit From Continuing Operations [Line Items] | |||||
Current - State | $ (22) | $ 18 | $ 13 | $ 115 | |
Deferred - State | (309) | (87) | (1,360) | 768 | |
Deferred - Federal | 936 | 2,412 | |||
Total | $ 605 | $ (69) | $ 1,065 | $ 883 |
Summary of Significant Accou_16
Summary of Significant Accounting Policies - Additional Information 3 (Detail) - USD ($) | Dec. 31, 2017 | Aug. 13, 2018 | Sep. 30, 2018 | Sep. 30, 2017 | Aug. 13, 2018 | Sep. 30, 2018 | Sep. 30, 2017 | Dec. 31, 2017 |
Operations And Summary Of Significant Accounting Policies [Line Items] | ||||||||
Federal statutory rate | 21.00% | 21.00% | ||||||
Operating losses carryforward indefinitely with no carryback as percentage of taxable income | 80.00% | |||||||
Interest expense threshold percentage of adjusted taxable income beyond which interest expense is deductible | 30.00% | |||||||
Deferred federal tax, Remeasurement Rate | 21.00% | |||||||
Refundable unused AMT credit carryforward, Percentage | 50.00% | |||||||
Refundable unused alternative minimum tax credit carryforward years | 2018 through 2020 | |||||||
Refundable unused AMT credit carryforward, year fully refunded by | 2,021 | |||||||
Net operating loss limitation | $ 3,300,000 | |||||||
Period of increase in net operating loss limitation | 5 years | |||||||
Net operating loss expiration period | 20 years | |||||||
Net Fair Value Presented in the Consolidated Balance Sheet, Liabilities Derivatives - current | $ 2,849,000 | $ 2,849,000 | ||||||
Fixed Rate Debt | ||||||||
Operations And Summary Of Significant Accounting Policies [Line Items] | ||||||||
Long-term debt, including current portion, Carrying Value | 816,300,000 | 816,300,000 | ||||||
Level 2 | Fixed Rate Debt | ||||||||
Operations And Summary Of Significant Accounting Policies [Line Items] | ||||||||
Long-term debt, including current portion, Fair Value | 850,000,000 | 850,000,000 | ||||||
Predecessor | ||||||||
Operations And Summary Of Significant Accounting Policies [Line Items] | ||||||||
Federal statutory rate | 21.00% | 35.00% | 21.00% | 35.00% | 35.00% | |||
Deferred federal tax, Remeasurement Value | $ 140,400,000 | |||||||
Refundable unused AMT credit carryforward, Valuation Allowance | 19,100,000 | $ 19,100,000 | ||||||
Derivative financial instruments, asset | $ 1,300,000 | $ 1,300,000 | ||||||
Predecessor | Fair Value, Measurements, Recurring | Level 3 | ||||||||
Operations And Summary Of Significant Accounting Policies [Line Items] | ||||||||
Financial assets | 0 | 0 | ||||||
Financial liabilities | $ 0 | $ 0 |
Summary of Significant Accou_17
Summary of Significant Accounting Policies - Difference Between Federal Statutory Rate and Effective Tax Rate (Detail) | 1 Months Ended | 2 Months Ended | 3 Months Ended | 7 Months Ended | 9 Months Ended | 12 Months Ended | |
Aug. 13, 2018 | Sep. 30, 2018 | Sep. 30, 2017 | Aug. 13, 2018 | Sep. 30, 2018 | Sep. 30, 2017 | Dec. 31, 2017 | |
Effective Income Tax Rate Continuing Operations Tax Rate Reconciliation [Line Items] | |||||||
Tax at statutory rate | 21.00% | 21.00% | |||||
Tax effect of: | |||||||
State income taxes, net of federal benefit | 2.00% | ||||||
Valuation allowance on deferred tax assets | (0.60%) | ||||||
Nondeductible stock-based compensation | (0.20%) | ||||||
Effective tax rate | 22.20% | ||||||
Predecessor | |||||||
Effective Income Tax Rate Continuing Operations Tax Rate Reconciliation [Line Items] | |||||||
Tax at statutory rate | 21.00% | 35.00% | 21.00% | 35.00% | 35.00% | ||
Tax effect of: | |||||||
State income taxes, net of federal benefit | 4.50% | 3.80% | 3.90% | 4.10% | |||
Valuation allowance on deferred tax assets | (21.10%) | (37.80%) | (24.10%) | (39.20%) | |||
Nondeductible stock-based compensation | (0.70%) | (0.70%) | (0.70%) | (1.10%) | |||
Other | (7.40%) | (1.30%) | (0.10%) | ||||
Effective tax rate | (3.70%) | 0.30% | (1.20%) | (1.30%) |
Summary of Significant Accou_18
Summary of Significant Accounting Policies - Additional Information 4 (Detail) - USD ($) $ in Thousands | 7 Months Ended | 9 Months Ended | ||
Aug. 13, 2018 | Sep. 30, 2018 | Sep. 30, 2017 | Dec. 31, 2017 | |
Operations And Summary Of Significant Accounting Policies [Line Items] | ||||
Performance multiplier, minimum | 0.00% | |||
Performance multiplier, maximum | 200.00% | |||
Participating securities that share in losses | 0 | |||
Convertible Notes | ||||
Operations And Summary Of Significant Accounting Policies [Line Items] | ||||
Interest paid in-kind | $ 25,000 | |||
Restricted Stock | ||||
Operations And Summary Of Significant Accounting Policies [Line Items] | ||||
Shares of unvested restricted stock outstanding | 422,545 | |||
Predecessor | ||||
Operations And Summary Of Significant Accounting Policies [Line Items] | ||||
Participating securities that share in losses | 0 | |||
Interest paid in-kind | $ 25,004 | $ 28,194 | ||
Predecessor | Convertible Notes | ||||
Operations And Summary Of Significant Accounting Policies [Line Items] | ||||
Interest paid in-kind | $ 28,200 | |||
Predecessor | Restricted Stock | ||||
Operations And Summary Of Significant Accounting Policies [Line Items] | ||||
Shares of unvested restricted stock outstanding | 904,181 | 619,867 |
Summary of Significant Accou_19
Summary of Significant Accounting Policies - Basic and Diluted Income (Loss) Per Share (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 1 Months Ended | 2 Months Ended | 3 Months Ended | 7 Months Ended | 9 Months Ended |
Aug. 13, 2018 | Sep. 30, 2018 | Sep. 30, 2017 | Aug. 13, 2018 | Sep. 30, 2017 | |
Earnings Per Share [Line Items] | |||||
Basic income attributable to common stock, Per Share | $ 0.13 | ||||
Diluted income attributable to common stock, Per Share | $ 0.13 | ||||
Net income (loss) | $ 13,823 | ||||
Income allocable to unvested restricted shares | (51) | ||||
Basic income attributable to common stock | 13,772 | ||||
Diluted income attributable to common stock | $ 13,772 | ||||
Basic income attributable to common stock, Shares | 105,448 | ||||
Effect of Dilutive Securities: Income allocable to unvested restricted shares, Shares | 15 | ||||
Diluted income attributable to common stock, Shares | 105,463 | ||||
Basic and diluted net loss attributable to common stock | $ (16,865) | $ (24,736) | |||
Basic and diluted net loss attributable to common stock, Shares | 15,468 | 14,796 | |||
Net income (loss) per share – basic and diluted | $ (1.09) | $ 0.13 | $ (1.67) | ||
Predecessor | |||||
Earnings Per Share [Line Items] | |||||
Net income (loss) | $ (16,865) | $ (24,736) | $ (92,754) | $ (69,109) | |
Basic income attributable to common stock, Shares | 15,468 | 14,796 | 15,262 | 14,591 | |
Diluted income attributable to common stock, Shares | 15,468 | 14,796 | 15,262 | 14,591 | |
Basic and diluted net loss attributable to common stock | $ (92,754) | ||||
Basic and diluted net loss attributable to common stock, Shares | 15,262 | ||||
Net income (loss) per share – basic and diluted | $ (1.09) | $ (1.67) | $ (6.08) | $ (4.74) |
Summary of Significant Accou_20
Summary of Significant Accounting Policies - Weighted Average Shares of Unvested Restricted Stock (Detail) - shares shares in Thousands | 1 Months Ended | 2 Months Ended | 3 Months Ended | 7 Months Ended | 9 Months Ended |
Aug. 13, 2018 | Sep. 30, 2018 | Sep. 30, 2017 | Aug. 13, 2018 | Sep. 30, 2017 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Unvested restricted stock | 396 | ||||
Predecessor | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Unvested restricted stock | 813 | 666 | 839 | 612 |
Summary of Significant Accou_21
Summary of Significant Accounting Policies - Common Stock and Convertible Stock Dilutive in Computation of Earning Per Share (Detail) shares in Thousands, EquityUnit in Thousands | 1 Months Ended | 2 Months Ended | 3 Months Ended | 7 Months Ended | 9 Months Ended |
Aug. 13, 2018EquityUnit$ / shares$ / EquityUnitshares | Sep. 30, 2018EquityUnit$ / shares$ / EquityUnitshares | Sep. 30, 2017EquityUnit$ / shares$ / EquityUnitshares | Aug. 13, 2018EquityUnit$ / shares$ / EquityUnitshares | Sep. 30, 2017EquityUnit$ / shares$ / EquityUnitshares | |
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | |||||
Weighted average warrants for common stock | shares | 15 | ||||
Weighted average PSUs | EquityUnit | 315 | ||||
Weighted average grant date fair value per unit | $ / EquityUnit | 12.93 | ||||
Predecessor | |||||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | |||||
Weighted average warrants for common stock | shares | 42 | 415 | 142 | 479 | |
Weighted average PSUs | EquityUnit | 514 | 303 | 476 | 281 | |
Weighted average grant date fair value per unit | $ / EquityUnit | 13.83 | 17.12 | 13.83 | 17.12 | |
Weighted average contingently convertible shares | shares | 40,631 | 37,624 | 39,819 | 36,676 | |
Warrants for Common Stock | |||||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | |||||
Weighted average exercise price per share | $ / shares | $ 0.01 | ||||
Warrants for Common Stock | Predecessor | |||||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | |||||
Weighted average exercise price per share | $ / shares | $ 0.01 | $ 0.01 | $ 0.01 | $ 0.01 | |
Contingently Convertible Shares | Predecessor | |||||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | |||||
Weighted average exercise price per share | $ / shares | $ 12.32 | $ 12.32 | $ 12.32 | $ 12.32 |
Summary of Significant Accou_22
Summary of Significant Accounting Policies - Cash Payments Made for Interest and Income Taxes (Detail) - USD ($) $ in Thousands | 2 Months Ended | 7 Months Ended | 9 Months Ended |
Sep. 30, 2018 | Aug. 13, 2018 | Sep. 30, 2017 | |
Supplemental Cash Flow Information [Line Items] | |||
Interest payments | $ 1,999 | ||
Predecessor | |||
Supplemental Cash Flow Information [Line Items] | |||
Interest payments | $ 36,187 | $ 72,913 | |
Income tax payments | $ 2 | $ 3 |
Long-Term Debt - Long-term Debt
Long-Term Debt - Long-term Debt (Detail) $ in Thousands | Sep. 30, 2018USD ($) |
Debt Instrument [Line Items] | |
Debt issuance costs, net of amortization | $ (23,506) |
Long-term Debt | 1,242,844 |
Bank Credit Facility | |
Debt Instrument [Line Items] | |
Principal | 450,000 |
9¾% Senior Notes due 2026 | |
Debt Instrument [Line Items] | |
Principal | 850,000 |
Discount, net of amortization | $ (33,650) |
Long-Term Debt - Long-term De_2
Long-Term Debt - Long-term Debt (Parenthetical) (Detail) | Sep. 30, 2018 |
9¾% Senior Notes due 2026 | |
Debt Instrument [Line Items] | |
Interest rate on debt instrument | 9.75% |
Long-Term Debt - Additional Inf
Long-Term Debt - Additional Information (Detail) - USD ($) | Aug. 03, 2018 | Sep. 30, 2018 | Aug. 14, 2018 |
9¾% Senior Notes due 2026 | |||
Debt Instrument [Line Items] | |||
Principal amount of notes issued | $ 850,000,000 | ||
Interest rate on debt instrument | 9.75% | ||
Interest payment terms | payable at an annual rate of 9¾% on February 15 and August 15 | ||
Maturity of senior notes | Aug. 15, 2026 | ||
Bank Credit Facility | |||
Debt Instrument [Line Items] | |||
Principal amount of notes issued | $ 450,000,000 | ||
Bank credit facility | 700,000,000 | $ 700,000,000 | |
Bank credit facility borrowing outstanding | $ 450,000,000 |
Long-Term Debt - Additional I_2
Long-Term Debt - Additional Information 1 (Detail) - Bank Credit Facility - USD ($) | Aug. 14, 2018 | Dec. 31, 2018 | Sep. 30, 2018 |
Debt Instrument [Line Items] | |||
Bank credit facility | $ 700,000,000 | $ 700,000,000 | |
Maturity of credit facility | Aug. 14, 2023 | ||
Bank credit facility borrowing outstanding | $ 450,000,000 | ||
Scenario, Forecast | |||
Debt Instrument [Line Items] | |||
Leverage ratio | 400.00% | ||
Current ratio | 100.00% | ||
Minimum | |||
Debt Instrument [Line Items] | |||
Commitment fee on unused borrowing base | 0.375% | ||
Maximum | |||
Debt Instrument [Line Items] | |||
Commitment fee on unused borrowing base | 0.50% | ||
LIBOR | Minimum | |||
Debt Instrument [Line Items] | |||
Spread rate for interest rate on credit facility | 2.00% | ||
LIBOR | Maximum | |||
Debt Instrument [Line Items] | |||
Spread rate for interest rate on credit facility | 3.00% | ||
Base Rate | Minimum | |||
Debt Instrument [Line Items] | |||
Spread rate for interest rate on credit facility | 1.00% | ||
Base Rate | Maximum | |||
Debt Instrument [Line Items] | |||
Spread rate for interest rate on credit facility | 2.00% |
Stockholders' Equity - Addition
Stockholders' Equity - Additional Information (Detail) - $ / shares | Aug. 14, 2018 | Sep. 30, 2018 | Sep. 30, 2017 | Aug. 10, 2018 | Dec. 31, 2017 |
Stockholders Equity [Line Items] | |||||
Common stock, shares authorized | 155,000,000 | ||||
Common stock, par value | $ 0.50 | ||||
Jones contribution transaction, Shares issued | 88,571,429 | ||||
Exercise price of warrants for common stock | $ 0.01 | ||||
Common stock warrants exercised, Shares | 402,708 | ||||
Remaining warrants expired without being exercised | 11,955 | ||||
Predecessor | |||||
Stockholders Equity [Line Items] | |||||
Total authorized shares | 160,000,000 | ||||
Common stock, shares authorized | 155,000,000 | 75,000,000 | |||
Common stock, par value | $ 0.50 | $ 0.50 | |||
Preferred stock, shares authorized | 5,000,000 | ||||
Preferred stock, par value | $ 10 | ||||
Common stock warrants exercised, Shares | 246,793 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Detail) $ in Millions | 9 Months Ended |
Sep. 30, 2018USD ($) | |
Commitments And Contingencies Disclosure [Abstract] | |
Natural gas transportation and treating agreements | through July 2019 |
Maximum commitments under natural gas transportation and treating agreements | $ 1 |
Contract term related to drilling services | through September 2019 |
Commitments for contracted drilling services | $ 16.5 |