Cover
Cover - shares | 9 Months Ended | |
Sep. 30, 2023 | Nov. 02, 2023 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Sep. 30, 2023 | |
Document Transition Report | false | |
Entity File Number | 001-12935 | |
Entity Registrant Name | DENBURY INC. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 20-0467835 | |
Entity Address, Address Line One | 5851 Legacy Circle, | |
Entity Address, City or Town | Plano, | |
Entity Address, State or Province | TX | |
Entity Address, Postal Zip Code | 75024 | |
City Area Code | (972) | |
Local Phone Number | 673-2000 | |
No Trading Symbol Flag | true | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Bankruptcy Proceedings, Reporting Current | true | |
Entity Common Stock, Shares Outstanding | 1,000 | |
Entity Central Index Key | 0000945764 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false |
Unaudited Condensed Consolidate
Unaudited Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Current assets | ||
Cash and cash equivalents | $ 803 | $ 521 |
Accrued production receivable | 161,953 | 144,277 |
Trade and other receivables, net | 18,239 | 27,343 |
Derivative assets | 98 | 15,517 |
Prepaids | 13,204 | 18,572 |
Total current assets | 194,297 | 206,230 |
Oil and natural gas properties (using full cost accounting) | ||
Proved properties | 1,882,430 | 1,414,779 |
Unevaluated properties | 119,557 | 240,435 |
CO2 properties | 199,609 | 190,985 |
Pipelines | 223,779 | 220,125 |
CCUS storage sites and related assets | 141,829 | 64,971 |
Other property and equipment | 117,858 | 107,133 |
Less accumulated depletion, depreciation, amortization and impairment | (427,759) | (306,743) |
Net property and equipment | 2,257,303 | 1,931,685 |
Operating lease right-of-use assets | 18,257 | 18,017 |
Derivative assets | 26 | 0 |
Intangible assets, net | 72,293 | 79,128 |
Restricted cash for future asset retirement obligations | 49,027 | 47,359 |
Other assets | 59,996 | 45,080 |
Total assets | 2,651,199 | 2,327,499 |
Current liabilities | ||
Accounts payable and accrued liabilities | 250,938 | 248,800 |
Oil and gas production payable | 79,496 | 80,368 |
Derivative liabilities | 40,813 | 13,018 |
Current maturities of long-term debt | 13 | 0 |
Operating lease liabilities | 5,136 | 4,676 |
Total current liabilities | 376,396 | 346,862 |
Long-term liabilities | ||
Long-term debt, net of current portion | 70,336 | 29,000 |
Asset retirement obligations | 350,448 | 315,942 |
Derivative liabilities | 336 | 0 |
Deferred tax liabilities, net | 110,556 | 71,120 |
Operating lease liabilities | 14,797 | 15,431 |
Other liabilities | 12,556 | 16,527 |
Total long-term liabilities | 559,029 | 448,020 |
Commitments and Contingencies | ||
Stockholders’ equity | ||
Preferred stock, $.001 par value, 50,000,000 shares authorized, none issued and outstanding | 0 | 0 |
Common stock, $.001 par value, 250,000,000 shares authorized; 51,446,811 and 49,814,874 shares issued, respectively | 51 | 50 |
Paid-in capital in excess of par | 1,076,632 | 1,047,063 |
Retained Earnings (Accumulated Deficit) | 639,091 | 485,504 |
Total stockholders’ equity | 1,715,774 | 1,532,617 |
Total liabilities and stockholders’ equity | $ 2,651,199 | $ 2,327,499 |
Unaudited Condensed Consolida_2
Unaudited Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Sep. 30, 2023 | Dec. 31, 2022 |
Stockholders’ equity | ||
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized (in shares) | 50,000,000 | 50,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per shares) | $ 0.001 | $ 0.001 |
Common stock, shares authorized (in shares) | 250,000,000 | 250,000,000 |
Common stock, shares issued (in shares) | 51,446,811 | 49,814,874 |
Unaudited Condensed Consolida_3
Unaudited Condensed Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Revenues | $ 354,396 | $ 431,472 | $ 1,022,212 | $ 1,324,447 |
Other income | 851 | 8,015 | 3,036 | 9,055 |
Total revenues and other income | 355,247 | 439,487 | 1,025,248 | 1,333,502 |
Taxes other than income | 29,072 | 33,789 | 85,047 | 101,487 |
General and administrative expenses | 26,430 | 21,071 | 76,302 | 58,998 |
Interest, net of amounts capitalized of $2,502, $1,044, $6,454 and $3,177, respectively | 843 | 909 | 2,595 | 3,092 |
Depletion, depreciation, and amortization | 52,917 | 37,680 | 144,716 | 108,425 |
Commodity derivatives expense (income) | 85,251 | (109,248) | 42,451 | 140,325 |
Other expenses | 14,143 | 2,726 | 19,624 | 11,459 |
Total expenses | 359,227 | 147,743 | 822,502 | 868,793 |
Income (loss) before income taxes | (3,980) | 291,744 | 202,746 | 464,709 |
Income tax provision (benefit) | (1,087) | 41,321 | 49,159 | 59,664 |
Net income (loss) | $ (2,893) | $ 250,423 | $ 153,587 | $ 405,045 |
Net income (loss) per common share | ||||
Basic (in dollars per shares) | $ (0.06) | $ 4.89 | $ 2.96 | $ 7.86 |
Diluted (in dollars per shares) | $ (0.06) | $ 4.66 | $ 2.85 | $ 7.43 |
Weighted average common shares outstanding | ||||
Basic (in shares) | 52,417 | 51,182 | 51,916 | 51,512 |
Diluted (in shares) | 52,417 | 53,715 | 53,941 | 54,524 |
Oil, natural gas, and related product sales | ||||
Revenues | $ 325,870 | $ 395,223 | $ 943,305 | $ 1,232,104 |
Lease operating expenses | 127,440 | 134,464 | 386,905 | 376,643 |
Operating expenses | 5,474 | 5,191 | 16,022 | 14,638 |
CO2 sales and transportation fees | ||||
Revenues | 12,706 | 18,586 | 34,556 | 44,618 |
Operating expenses | 2,138 | 2,066 | 4,931 | 6,564 |
Oil marketing revenues | ||||
Revenues | 15,820 | 17,663 | 44,351 | 47,725 |
Operating expenses | $ 15,519 | $ 19,095 | $ 43,909 | $ 47,162 |
Unaudited Condensed Consolida_4
Unaudited Condensed Consolidated Statements of Operations (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Expenses | ||||
Interest costs capitalized | $ 2,502 | $ 1,044 | $ 6,454 | $ 3,177 |
Unaudited Condensed Consolida_5
Unaudited Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Cash flows from operating activities | ||
Net income | $ 153,587 | $ 405,045 |
Adjustments to reconcile net income to cash flows from operating activities | ||
Depletion, depreciation, and amortization | 144,716 | 108,425 |
Deferred income taxes | 39,436 | 53,301 |
Stock-based compensation | 18,145 | 11,491 |
Commodity derivatives expense | 42,451 | 140,325 |
Receipt (payment) on settlements of commodity derivatives | 1,074 | (276,796) |
Debt issuance cost amortization | 1,594 | 2,465 |
Gain from asset sales | (403) | (1,119) |
Other, net | (4,413) | (11,543) |
Changes in assets and liabilities, net of effects from acquisitions | ||
Accrued production receivable | (17,676) | (32,884) |
Trade and other receivables | 9,106 | 66 |
Other current and long-term assets | 5,340 | (21,729) |
Accounts payable and accrued liabilities | 9,738 | 28,359 |
Oil and natural gas production payable | (872) | 13,412 |
Asset retirement obligations and other liabilities | (26,413) | (22,409) |
Net cash provided by operating activities | 375,410 | 396,409 |
Cash flows from investing activities | ||
Oil and natural gas capital expenditures | (320,422) | (217,834) |
CCUS storage sites and related capital expenditures | (69,891) | (27,518) |
Acquisitions of oil and natural gas properties | (1,427) | (874) |
Pipelines and plants capital expenditures | 0 | (22,259) |
Net proceeds from sales of oil and natural gas properties and equipment | 0 | 237 |
Equity investments | (18,817) | (10,000) |
Other | (17,993) | (9,746) |
Net cash used in investing activities | (428,550) | (287,994) |
Cash flows from financing activities | ||
Bank repayments | (1,399,000) | (808,000) |
Bank borrowings | 1,440,000 | 788,000 |
Common stock repurchase program | 0 | (100,028) |
Other | 14,090 | 9,421 |
Net cash provided by (used in) financing activities | 55,090 | (110,607) |
Net increase (decrease) in cash, cash equivalents, and restricted cash | 1,950 | (2,192) |
Cash, cash equivalents, and restricted cash at beginning of period | 47,880 | 50,344 |
Cash, cash equivalents, and restricted cash at end of period | $ 49,830 | $ 48,152 |
Unaudited Condensed Consolida_6
Unaudited Condensed Consolidated Statement of Changes in Stockholders' Equity - USD ($) $ in Thousands | Total | Common Stock ($.001 Par Value) | Paid-In Capital in Excess of Par | Retained Earnings | Treasury Stock (at cost) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Beginning balance (in shares) | 0 | ||||
Beginning balance (in shares) at Dec. 31, 2021 | 50,193,656 | ||||
Beginning balance at Dec. 31, 2021 | $ 1,135,390 | $ 50 | $ 1,129,996 | $ 5,344 | $ 0 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Issued pursuant to stock compensation plans (in shares) | 141,581 | ||||
Stock-based compensation | 3,142 | 3,142 | |||
Tax withholding for stock compensation plans | (58) | (58) | |||
Issued pursuant to exercise of warrants (in shares) | 14,153 | ||||
Issued pursuant to exercise of warrants | 47 | 47 | |||
Net income(loss) | (872) | (872) | |||
Ending balance (in shares) at Mar. 31, 2022 | 50,349,390 | ||||
Ending balance (in shares) at Mar. 31, 2022 | 0 | ||||
Ending balance at Mar. 31, 2022 | 1,137,649 | $ 50 | 1,133,127 | 4,472 | $ 0 |
Beginning balance (in shares) at Dec. 31, 2021 | 50,193,656 | ||||
Beginning balance at Dec. 31, 2021 | 1,135,390 | $ 50 | 1,129,996 | 5,344 | $ 0 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net income(loss) | 405,045 | ||||
Ending balance (in shares) at Sep. 30, 2022 | 49,793,270 | ||||
Ending balance (in shares) at Sep. 30, 2022 | 0 | ||||
Ending balance at Sep. 30, 2022 | 1,452,877 | $ 50 | 1,042,438 | 410,389 | $ 0 |
Beginning balance (in shares) at Dec. 31, 2021 | 50,193,656 | ||||
Beginning balance at Dec. 31, 2021 | $ 1,135,390 | $ 50 | 1,129,996 | 5,344 | $ 0 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Retired treasury shares (in shares) | (1,600,000) | ||||
Retired treasury shares | $ (100,000) | ||||
Ending balance (in shares) at Dec. 31, 2022 | 49,814,874 | 49,814,874 | |||
Ending balance (in shares) at Dec. 31, 2022 | 0 | ||||
Ending balance at Dec. 31, 2022 | $ 1,532,617 | $ 50 | 1,047,063 | 485,504 | $ 0 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Beginning balance (in shares) | 0 | ||||
Beginning balance (in shares) at Mar. 31, 2022 | 50,349,390 | ||||
Beginning balance at Mar. 31, 2022 | 1,137,649 | $ 50 | 1,133,127 | 4,472 | $ 0 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Forfeited pursuant to stock compensation plans (in shares) | (3,264) | ||||
Stock-based compensation | 4,400 | 4,400 | |||
Tax withholding for stock compensation plans | (5) | (5) | |||
Issued pursuant to exercise of warrants (in shares) | 987,411 | ||||
Issued pursuant to exercise of warrants | 54 | $ 1 | 53 | ||
Stock repurchase program (in shares) | (457,549) | (457,549) | |||
Stock repurchase program | (28,751) | $ (28,751) | |||
Net income(loss) | 155,494 | 155,494 | |||
Ending balance (in shares) at Jun. 30, 2022 | 50,875,988 | ||||
Ending balance (in shares) at Jun. 30, 2022 | 457,549 | ||||
Ending balance at Jun. 30, 2022 | 1,268,841 | $ 51 | 1,137,575 | 159,966 | $ (28,751) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Beginning balance (in shares) | 457,549 | ||||
Stock-based compensation | 4,691 | 4,691 | |||
Retired treasury shares (in shares) | (1,615,391) | ||||
Retired treasury shares | $ (1) | (100,029) | $ 100,030 | ||
Tax withholding for stock compensation plans (in shares) | (35) | (35) | |||
Tax withholding for stock compensation plans | (2) | $ (2) | |||
Issued pursuant to exercise of warrants (in shares) | 71,440 | ||||
Issued pursuant to exercise of warrants | 201 | 201 | |||
Stock repurchase program (in shares) | (1,157,807) | (1,157,807) | |||
Stock repurchase program | (71,277) | $ (71,277) | |||
Net issued pursuant to stock compensation plans (in shares) | 3,684 | ||||
Net income(loss) | 250,423 | 250,423 | |||
Ending balance (in shares) at Sep. 30, 2022 | 49,793,270 | ||||
Ending balance (in shares) at Sep. 30, 2022 | 0 | ||||
Ending balance at Sep. 30, 2022 | $ 1,452,877 | $ 50 | 1,042,438 | 410,389 | $ 0 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Beginning balance (in shares) | 0 | ||||
Beginning balance (in shares) | 0 | ||||
Beginning balance (in shares) at Dec. 31, 2022 | 49,814,874 | 49,814,874 | |||
Beginning balance at Dec. 31, 2022 | $ 1,532,617 | $ 50 | 1,047,063 | 485,504 | $ 0 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Issued pursuant to stock compensation plans (in shares) | 268,748 | ||||
Stock-based compensation | 5,320 | 5,320 | |||
Tax withholding for stock compensation plans (in shares) | (16,281) | ||||
Tax withholding for stock compensation plans | (2,683) | (2,683) | |||
Issued pursuant to exercise of warrants (in shares) | 209,185 | ||||
Issued pursuant to exercise of warrants | 130 | 130 | |||
Net income(loss) | 89,199 | 89,199 | |||
Ending balance (in shares) at Mar. 31, 2023 | 50,276,526 | ||||
Ending balance (in shares) at Mar. 31, 2023 | 0 | ||||
Ending balance at Mar. 31, 2023 | $ 1,624,583 | $ 50 | 1,049,830 | 574,703 | $ 0 |
Beginning balance (in shares) at Dec. 31, 2022 | 49,814,874 | 49,814,874 | |||
Beginning balance at Dec. 31, 2022 | $ 1,532,617 | $ 50 | 1,047,063 | 485,504 | $ 0 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Retired treasury shares (in shares) | (16,281) | ||||
Retired treasury shares | $ (1,400) | ||||
Net income(loss) | $ 153,587 | ||||
Ending balance (in shares) at Sep. 30, 2023 | 51,446,811 | 51,446,811 | |||
Ending balance (in shares) at Sep. 30, 2023 | 0 | ||||
Ending balance at Sep. 30, 2023 | $ 1,715,774 | $ 51 | 1,076,632 | 639,091 | $ 0 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Beginning balance (in shares) | 0 | ||||
Beginning balance (in shares) at Mar. 31, 2023 | 50,276,526 | ||||
Beginning balance at Mar. 31, 2023 | 1,624,583 | $ 50 | 1,049,830 | 574,703 | $ 0 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Forfeited pursuant to stock compensation plans (in shares) | (1,013) | ||||
Stock-based compensation | 7,246 | 7,246 | |||
Issued pursuant to exercise of warrants (in shares) | 186,373 | ||||
Issued pursuant to exercise of warrants | 228 | 228 | |||
Employee stock purchase plan (in shares) | 11,115 | ||||
Employee stock purchase plan | 815 | 815 | |||
Net income(loss) | 67,281 | 67,281 | |||
Ending balance (in shares) at Jun. 30, 2023 | 50,473,001 | ||||
Ending balance (in shares) at Jun. 30, 2023 | 0 | ||||
Ending balance at Jun. 30, 2023 | 1,700,153 | $ 50 | 1,058,119 | 641,984 | $ 0 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Beginning balance (in shares) | 0 | ||||
Forfeited pursuant to stock compensation plans (in shares) | (1,211) | ||||
Stock-based compensation | 7,359 | 7,359 | |||
Issued pursuant to exercise of warrants (in shares) | 975,021 | ||||
Issued pursuant to exercise of warrants | 11,155 | $ 1 | 11,154 | ||
Net income(loss) | $ (2,893) | (2,893) | |||
Ending balance (in shares) at Sep. 30, 2023 | 51,446,811 | 51,446,811 | |||
Ending balance (in shares) at Sep. 30, 2023 | 0 | ||||
Ending balance at Sep. 30, 2023 | $ 1,715,774 | $ 51 | $ 1,076,632 | $ 639,091 | $ 0 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Beginning balance (in shares) | 0 |
Basis of Presentation
Basis of Presentation | 9 Months Ended |
Sep. 30, 2023 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Note 1. Basis of Presentation Organization and Nature of Operations Denbury Inc., a Delaware corporation (the “Company”) is an independent energy company with operations focused in the Gulf Coast and Rocky Mountain regions of the United States. The Company is differentiated by its focus on CO 2 enhanced oil recovery (“EOR”) and the emerging carbon capture, utilization, and storage (“CCUS”) industry, supported by the Company’s CO 2 EOR technical and operational expertise and its extensive CO 2 pipeline infrastructure. On July 13, 2023, the Company entered into an Agreement and Plan of Merger (the “Merger Agreement”) by and among the Company, Exxon Mobil Corporation, a New Jersey corporation (“ExxonMobil”), and EMPF Corporation, a Delaware corporation and a wholly-owned subsidiary of ExxonMobil (“Merger Sub”). Upon the terms and subject to the conditions set forth in the Merger Agreement, on November 2, 2023, Merger Sub merged with and into the Company (the “Merger”), with the Company surviving the Merger as a wholly owned subsidiary of ExxonMobil (the “Surviving Corporation”). On November 2, 2023 (the “Effective Time”), each share of Company common stock, par value $0.001 per share (the “Denbury Common Stock”) issued and outstanding immediately prior to the Effective Time (including the unvested restricted stock of the Company, but excluding shares of Denbury Common Stock held (1) in treasury (excluding Denbury Common Stock subject to or issuable in connection with a Company employee benefit plan) or (2) by ExxonMobil or Merger Sub, which were cancelled at the Effective Time) was cancelled and converted into the right to receive 0.840 shares of ExxonMobil common stock, without par value (“ExxonMobil Common Stock”) (together with cash in lieu of fractional shares, the “Merger Consideration”), without interest and subject to any applicable withholding taxes, in accordance with the Merger Agreement. Additionally, each Company restricted stock unit (each, a “Denbury RSU”), each Company deferred stock unit (each, a “Denbury DSU”) and each Company performance stock unit whose vesting was subject to performance goals related to absolute or relative total shareholder return (each, a “Denbury TSR Performance Award”) that was outstanding immediately prior to the Effective Time, whether vested or unvested, automatically became fully vested and was canceled and converted into the right to receive the Merger Consideration in accordance with the Merger Agreement in respect of the total number of shares of Denbury Common Stock subject to each respective Denbury RSU, Denbury DSU and Denbury TSR Performance Award (in the case of the Denbury TSR Performance Awards, with such number determined based on actual performance levels, calculated in accordance with the underlying award agreements), without interest and subject to any applicable withholding taxes. The issuance of ExxonMobil Common Stock in connection with the Merger was registered under the Securities Act of 1933, as amended (the “Securities Act”), pursuant to ExxonMobil’s registration statement on Form S-4, as amended (File No. 333-274252), which was declared effective by the U.S. Securities and Exchange Commission (the “SEC”) on September 29, 2023. The foregoing description of the Merger, the Merger Agreement, and the transactions contemplated thereby, is a summary only, does not purport to be complete, and is subject to and qualified in its entirety by reference to the full text of the Merger Agreement, a copy of which is attached as Annex A to the Company’s Proxy Statement on Schedule 14A, filed with the SEC on September 29, 2023. Interim Financial Statements The accompanying unaudited condensed consolidated financial statements of Denbury Inc. and its subsidiaries have been prepared in accordance with the rules and regulations of the SEC and do not include all of the information and footnotes required by accounting principles generally accepted in the United States for complete financial statements. These financial statements and the notes thereto should be read in conjunction with our Annual Report on Form 10-K for the year ended December 31, 2022 (the “Form 10-K”). Unless indicated otherwise or the context requires, the terms “we,” “our,” “us,” “Company” or “Denbury,” refer to Denbury Inc. and its subsidiaries. Accounting measurements at interim dates inherently involve greater reliance on estimates than at year end, and the results of operations for the interim periods shown in this report are not necessarily indicative of results to be expected for the year. In management’s opinion, the accompanying unaudited condensed consolidated financial statements include all adjustments of a normal recurring nature necessary for a fair presentation of our consolidated financial position as of September 30, 2023, our consolidated results of operations for the three and nine months ended September 30, 2023 and 2022, our consolidated cash flows for the nine months ended September 30, 2023 and 2022, and our consolidated statements of changes in stockholders’ equity for the three and nine months ended September 30, 2023 and 2022. Reclassifications Certain prior period amounts have been reclassified to conform to the current year presentation. Such reclassifications had no impact on our reported net income (loss), current assets, total assets, current liabilities, total liabilities or stockholders’ equity. Cash, Cash Equivalents, and Restricted Cash We consider all highly liquid investments to be cash equivalents if they have maturities of three months or less at the date of purchase. The following table provides a reconciliation of cash, cash equivalents, and restricted cash as reported within the Unaudited Condensed Consolidated Balance Sheets to “Cash, cash equivalents, and restricted cash at end of period” as reported within the Unaudited Condensed Consolidated Statements of Cash Flows: In thousands September 30, 2023 September 30, 2022 Cash and cash equivalents $ 803 $ 519 Restricted cash for future asset retirement obligations 49,027 47,633 Total cash, cash equivalents, and restricted cash shown in the Unaudited Condensed Consolidated Statements of Cash Flows $ 49,830 $ 48,152 Restricted cash for future asset retirement obligations in the table above consists of escrow accounts that are legally restricted for certain of our asset retirement obligations. Net Income (Loss) per Common Share Basic net income (loss) per common share is computed by dividing the net income (loss) attributable to common stockholders by the weighted average number of shares of common stock outstanding during the period. Basic weighted average common shares exclude shares of nonvested restricted stock (although nonvested restricted stock is issued and outstanding upon grant). As these restricted shares vest, they will be included in the shares outstanding used to calculate basic net income (loss) per common share. Restricted stock units and performance stock units are also excluded from basic weighted average common shares outstanding until the vesting date. Basic weighted average common shares during the three and nine months ended September 30, 2023 includes 1,775,182 performance-based and restricted stock units which are fully vested as of September 30, 2023; however, the shares underlying these awards are not included in shares currently issued or outstanding as actual delivery of the shares had not occurred as of September 30, 2023. Diluted net income (loss) per common share is calculated in the same manner but includes the impact of all potentially dilutive securities. Potentially dilutive securities include restricted stock, restricted stock units, performance stock units, shares to be issued under the employee stock purchase plan (“ESPP”), and warrants . For each of the three and nine months ended September 30, 2023 and 2022, there were no adjustments to net income (loss) for purposes of calculating basic and diluted net income (loss) per common share. For the three months ended September 30, 2023, the weighted average common shares outstanding used to calculate basic earnings per share and diluted earnings per share were the same, since the Company recorded a net loss during the period. The following table sets forth the weighted average shares used for purposes of calculating basic and diluted net income (loss) per common share for the periods indicated: Three Months Ended Nine Months Ended September 30, September 30, In thousands 2023 2022 2023 2022 Weighted average common shares outstanding – basic 52,417 51,182 51,916 51,512 Effect of potentially dilutive securities Restricted stock, restricted stock units and performance stock units — 664 440 615 Warrants — 1,869 1,584 2,397 Employee Stock Purchase Plan — — 1 — Weighted average common shares outstanding – diluted 52,417 53,715 53,941 54,524 For purposes of calculating diluted weighted average common shares, unvested restricted stock units, unvested restricted stock, unvested performance stock units, unissued ESPP shares and unexercised warrants are included in the diluted shares computation using the treasury stock method. The following outstanding securities were excluded from the computation of diluted net income (loss) per share for the three months ended September 30, 2023 and September 30, 2022, as their effect would have been antidilutive, as of the respective dates: September 30, In thousands 2023 2022 Restricted stock, restricted stock units and performance stock units (1) 966 196 Warrants 992 — Employee Stock Purchase Plan 6 8 (1) Antidilutive shares for the three-month periods ended September 30, 2023 and 2022 reflect total shares excluded from the computation of diluted net income per share that are potentially dilutive in the future, assuming performance stock units at the target level. Shares disclosed for the period ended September 30, 2022 have been revised to be consistent with the current year presentation. At September 30, 2023, the Company had 1.0 million Series A warrants outstanding exercisable for shares of our common stock, on a cash or cashless basis, at an exercise price of $32.59 per share for each of the Series A warrants outstanding. Outstanding Series B warrants expired on September 18, 2023, in accordance with the Series B warrant agreement. From issuance through September 30, 2023, a total of 1.6 million Series A warrants and a total of 2.7 million Series B warrants have been exercised for a total of 2.7 million shares, most of which were exercised on a cashless basis. During October 2023, 1.0 million Series A warrants were exercised resulting in the issuance of 0.8 million shares, and any remaining unexercised Series A warrants expired prior to the effective time of the Merger. Oil and Natural Gas Properties Write-Down of Oil and Natural Gas Properties. Under full cost accounting, the net capitalized costs of oil and natural gas properties are limited to the lower of unamortized cost or the cost center ceiling. The cost center ceiling is defined as (1) the present value of estimated future net revenues from proved oil and natural gas reserves before future abandonment costs (discounted at 10%), based on the average first-day-of-the-month oil and natural gas price for each month during a 12-month rolling period prior to the end of a particular reporting period; plus (2) the cost of properties not being amortized; plus (3) the lower of cost or estimated fair value of unproved properties included in the costs being amortized, if any; less (4) related income tax effects. Our future net revenues from proved oil and natural gas reserves are not reduced for development costs related to the cost of drilling for and developing CO 2 reserves nor those related to the cost of constructing CO 2 pipelines, as we do not have to incur additional CO 2 capital costs to develop the proved oil and natural gas reserves. Therefore, we include in the ceiling test, as a reduction of future net revenues, that portion of our capitalized CO 2 costs related to CO 2 reserves and CO 2 pipelines that we estimate will be consumed in the process of producing our proved oil and natural gas reserves. The fair value of our oil and natural gas derivative contracts is not included in the ceiling test, as we do not designate these contracts as hedge instruments for accounting purposes. The cost center ceiling test is prepared quarterly. We did not record a ceiling test write-down during the three or nine months ended September 30, 2023 or September 30, 2022. Equity Method Investments |
Revenue Recognition
Revenue Recognition | 9 Months Ended |
Sep. 30, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Revenue Recognition | Note 2. Revenue Recognition We record revenue in accordance with Financial Accounting Standards Board (“FASB”) Codification (“FASC”) Topic 606, Revenue from Contracts with Customers . The core principle of FASC Topic 606 is that an entity should recognize revenue for the transfer of goods or services equal to the amount of consideration that it expects to be entitled to receive for those goods or services. Once we have delivered the volume of commodity to the delivery point and the customer takes delivery and possession, we are entitled to payment and we invoice the customer for such delivered production. Payment under most oil and CO 2 contracts is received within one month following product delivery, and for natural gas and NGL contracts, payment is generally received within two months following delivery. Timing of revenue recognition may differ from the timing of invoicing to customers; however, as the right to consideration after delivery is unconditional based on only the passage of time before payment of the consideration is due, upon delivery we record a receivable in “Accrued production receivable” in our Unaudited Condensed Consolidated Balance Sheets. In certain situations, the Company enters into marketing arrangements for the purchase and subsequent sale of crude oil from third parties. We recognize the revenue received and the associated expense incurred on these sales on a gross basis, as “Oil marketing revenues” and “Oil marketing purchases” in our Unaudited Condensed Consolidated Statements of Operations, since we act as a principal in the transaction by assuming control of the commodities purchased and responsibility to deliver the commodities sold. Revenue is recognized when control transfers to the purchaser at the delivery point based on the price received from the purchaser. Disaggregation of Revenue The following table summarizes our revenues by product type for the three and nine months ended September 30, 2023 and 2022: Three Months Ended Nine Months Ended September 30, September 30, In thousands 2023 2022 2023 2022 Oil sales $ 324,236 $ 389,543 $ 938,351 $ 1,217,377 Natural gas sales 1,634 5,680 4,954 14,727 CO 2 sales and transportation fees 12,706 18,586 34,556 44,618 Oil marketing revenues 15,820 17,663 44,351 47,725 Total revenues $ 354,396 $ 431,472 $ 1,022,212 $ 1,324,447 |
Long-Term Debt
Long-Term Debt | 9 Months Ended |
Sep. 30, 2023 | |
Debt Disclosure [Abstract] | |
Long-Term Debt | Note 3. Long-Term Debt The table below reflects long-term debt outstanding as of the dates indicated: In thousands September 30, 2023 December 31, 2022 Senior Secured Bank Credit Agreement $ 70,000 $ 29,000 Finance lease obligations 349 — Total debt principal balance 70,349 29,000 Less: current maturities of long-term debt (13) — Long-term debt and finance lease obligations $ 70,336 $ 29,000 Senior Secured Bank Credit Agreement In September 2020, we entered into a credit agreement with JPMorgan Chase Bank, N.A., as administrative agent, and other lenders party thereto (as amended, the “Bank Credit Agreement”). The Bank Credit Agreement is a senior secured revolving credit facility with a maturity date of May 4, 2027. The weighted average interest rate on borrowings outstanding as of September 30, 2023 under the Bank Credit Agreement was 8.2%. The undrawn portion of the aggregate lender commitments under the Bank Credit Agreement is subject to a commitment fee of 0.5% per annum. Cash interest, including commitment fees paid on the Company’s bank credit facility but excluding debt issue costs, were $2.8 million and $7.5 million during the three and nine months ended September 30, 2023, respectively, and $1.4 million and $3.8 million during the corresponding prior-year periods. As of September 30, 2023, we had $10.4 million of outstanding letters of credit. As of September 30, 2023, we were in compliance with all debt covenants under the Bank Credit Agreement. On October 27, 2023, we entered into a Fourth Amendment to the Bank Credit Agreement, which allowed us to borrow an amount exceeding the existing $75 million “excess cash” limitation for purposes of liquidity ahead of the closing of the Merger. In connection with the consummation of the Merger, on November 2, 2023, the Company terminated all outstanding lender commitments, including commitments of the lenders to issue letters of credit, under the Bank Credit Agreement. In connection with the termination of the Bank Credit Agreement, on November 2, 2023, all outstanding obligations for principal, interest and fees under the Bank Credit Agreement were paid off in full, and all liens securing such obligations and any letters of credit or hedging obligations permitted by the Bank Credit Agreement to be secured by such liens and guarantees of such obligations were released. |
Investments
Investments | 9 Months Ended |
Sep. 30, 2023 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Investments | Note 4. Investments Equity Method Investments Our equity-method investments and their book value balances consisted of the following: In thousands September 30, 2023 December 31, 2022 Equity method investments (1) Clean Hydrogen Works, LA-1, L.L.C. $ 20,000 $ 10,218 Libra CO 2 Storage Solutions LLC 1,926 — Total equity method investments $ 21,926 $ 10,218 (1) Investment balances include capitalized transaction costs. Clean Hydrogen Works. In April 2023, based on the achievement of certain milestones, we invested the remaining $10 million of our total $20 million commitment to invest in Clean Hydrogen Works (“CHW”), the project development company of a planned blue hydrogen/ammonia multi-block facility for which we have signed a definitive agreement for the transportation and storage of CO 2 for the first two blocks of the proposed plant. We account for the investment in CHW under the equity method of accounting. When an entity makes an investment that qualifies for the equity method of accounting, there may be a difference in the cost basis of the investment and the proportional interest in the underlying equity in the net assets of the investee (“basis difference”) . At the acquisition date, the Company identified a basis difference of $17.7 million associated with its investment in CHW. The basis difference was allocated to finite lived intangible assets identified and equity method goodwill. The Company will amortize the basis differences attributable to finite lived intangible assets and record the amortization as a reduction of earnings from equity method investments, net in the accompanying Unaudited Condensed Consolidated Statements of Operations. Libra CO 2 Storage Solutions LLC. During the second quarter of 2023, we invested $1.5 million in Libra CO 2 Storage Solutions LLC in connection with a joint venture related to a CO 2 sequestration project in St. Charles Parish, Louisiana. Other Investments During the first quarter of 2023, we made two investments in carbon capture technology companies, including a $2 million investment in Aqualung Carbon Capture AS and a $5 million investment in ION Clean Energy, Inc. All investments are included in “Other assets” in the Unaudited Condensed Consolidated Balance Sheets as of September 30, 2023. |
Stockholders' Equity
Stockholders' Equity | 9 Months Ended |
Sep. 30, 2023 | |
Stockholders' Equity Note [Abstract] | |
Stockholders' Equity | Note 5. Stockholders’ Equity 2022 Share Repurchases In May 2022, our Board of Directors authorized a common share repurchase program for up to $250 million of outstanding Denbury common stock. During June and July 2022, the Company repurchased 1,615,356 shares of Denbury common stock under this program for approximately $100 million, at an average price of $61.92 per share. No share repurchases have been made under this program since that time. Retirement of Treasury Stock During the year ended December 31, 2022, we retired 1.6 million shares of existing treasury stock, with a carrying value of $100 million, acquired through our stock repurchase program. Upon the retirement of treasury stock, we reduce common stock by the par value of common stock retired, and we reduce additional paid-in capital by the value of those shares in excess of par value. Tax Withholding and Treasury Stock Retirement in Connection with Stock Compensation Plans During the nine months ended September 30, 2023, employees surrendered 16,281 shares of common stock, with a carrying value of approximately $1.4 million, to cover employee tax withholdings upon vesting of restricted stock awards, which shares were concurrently retired. As awards for restricted stock units (“RSUs”) are settled, the Company issues the net shares of common stock, reduced by the units surrendered to cover tax withholding. For the nine months ended September 30, 2023, we decreased additional paid in capital by $1.3 million for tax withholdings on RSUs. |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2023 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Note 6. Income Taxes We make estimates and judgments in determining our income tax expense for financial reporting purposes. These estimates and judgments occur in the calculation of certain tax assets and liabilities that arise from differences in the timing and recognition of revenue and expense for tax and financial reporting purposes. Significant judgment is required in estimating valuation allowances, and in making this determination we consider all available positive and negative evidence and make certain assumptions. The realization of a deferred tax asset ultimately depends on the existence of sufficient taxable income in the applicable carryback or carryforward periods. In our assessment, we consider the nature, frequency, and severity of current and cumulative losses, as well as historical and forecasted financial results, the overall business environment, our industry’s historic cyclicality, the reversal of existing deferred tax assets and liabilities, and tax planning strategies. We assess the valuation allowance recorded on our deferred tax assets on a quarterly basis, which was $59.2 million at December 31, 2022. This valuation allowance relates primarily to our Louisiana net deferred tax assets of $55.4 million, as well as our Alabama net deferred tax assets and certain Mississippi tax credits totaling $3.8 million. We have concluded that the benefits of such deferred tax assets were not more likely than not to be realized due to lack of sufficient taxable income to fully realize the benefits of such deferred tax assets. We evaluate our estimated annual effective income tax rate based on current and forecasted business results and enacted tax laws on a quarterly basis and apply this tax rate to our ordinary income or loss to calculate our estimated tax liability or benefit. Our income taxes are based on an estimated combined federal and state statutory rate of approximately 25% in 2023 and 2022. Our effective tax rate for the three months ended September 30, 2023 was slightly higher than our estimated statutory rate primarily due to the effects of a small pretax loss; our effective tax rate for the nine months ended September 30, 2023 was slightly lower than our estimated statutory rate primarily due to excess stock compensation deductions that were recorded discretely in the first quarter. Our effective tax rate for the three and nine months ended September 30, 2022 was significantly lower than our estimated statutory rate due to the release of a portion of the valuation allowance on our deferred tax assets. |
Commodity Derivative Contracts
Commodity Derivative Contracts | 9 Months Ended |
Sep. 30, 2023 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Commodity Derivative Contracts | Note 7. Commodity Derivative Contracts We do not apply hedge accounting treatment to our oil and natural gas derivative contracts; therefore, the changes in the fair values of these instruments are recognized in income in the period of change. These fair value changes, along with the settlements of expired contracts, are shown under “Commodity derivatives expense (income)” in our Unaudited Condensed Consolidated Statements of Operations. Historically, we have entered into various oil and natural gas derivative contracts to provide an economic hedge of our exposure to commodity price risk associated with anticipated future oil and natural gas production and to provide more certainty to our future cash flows. We do not hold or issue derivative financial instruments for trading purposes. Over the last few years these contracts have consisted of fixed-price swaps and costless collars. The production we hedge has varied from year to year depending on our levels of debt, financial strength and expectation of future commodity prices, and occasionally requirements under our bank credit facility. We currently have no hedging requirements under our bank credit facility. We manage and control market and counterparty credit risk through established internal control procedures that are reviewed on an ongoing basis. We attempt to minimize credit risk exposure to counterparties through formal credit policies, monitoring procedures and diversification, and all of our commodity derivative contracts are with parties that are lenders under our Bank Credit Agreement (or affiliates of such lenders). As of September 30, 2023, all of our outstanding derivative contracts were subject to enforceable master netting arrangements whereby payables on those contracts can be offset against receivables from separate derivative contracts with the same counterparty. It is our policy to classify derivative assets and liabilities on a gross basis on our balance sheets, even if the contracts are subject to enforceable master netting arrangements. The following table summarizes our commodity derivative contracts as of September 30, 2023, none of which are classified as hedging instruments in accordance with the FASC Derivatives and Hedging topic: Months Index Price Volume (Barrels per day) Contract Prices ($/Bbl) Weighted Average Price Swap Floor Ceiling Oil Contracts: 2023 Fixed-Price Swaps Oct – Dec NYMEX 18,000 $ 78.51 $ — $ — 2023 Collars Oct – Dec NYMEX 9,000 $ — $ 68.33 $ 100.69 2024 Fixed-Price Swaps Jan – June NYMEX 19,000 $ 75.36 $ — $ — July – Dec NYMEX 3,000 76.50 — — |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 30, 2023 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Note 8. Fair Value Measurements The FASC Fair Value Measurement topic defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (often referred to as the “exit price”). We utilize market data or assumptions that market participants would use in pricing the asset or liability, including assumptions about risk and the risks inherent in the inputs to the valuation technique. These inputs can be readily observable, market corroborated or generally unobservable. We primarily apply the income approach for recurring fair value measurements and endeavor to utilize the best available information. Accordingly, we utilize valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs. We are able to classify fair value balances based on the observability of those inputs. The FASC establishes a fair value hierarchy that prioritizes the inputs used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurement) and the lowest priority to unobservable inputs (Level 3 measurement). The three levels of the fair value hierarchy are as follows: • Level 1 – Quoted prices in active markets for identical assets or liabilities as of the reporting date. • Level 2 – Pricing inputs are other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reported date. Level 2 includes those financial instruments that are valued using models or other valuation methodologies. Instruments in this category include non-exchange-traded oil derivatives that are based on NYMEX. Our costless collars are valued using the Black-Scholes model, an industry standard option valuation model that takes into account inputs such as contractual prices for the underlying instruments, maturity, quoted forward prices for commodities, interest rates, volatility factors and credit worthiness, as well as other relevant economic measures. Substantially all of these assumptions are observable in the marketplace throughout the full term of the instrument, can be derived from observable data or are supported by observable levels at which transactions are executed in the marketplace. • Level 3 – Pricing inputs include significant inputs that are generally less observable. These inputs may be used with internally developed methodologies that result in management’s best estimate of fair value. We adjust the valuations from the valuation model for nonperformance risk, using our estimate of the counterparty’s credit quality for asset positions and our credit quality for liability positions. We use multiple sources of third-party credit data in determining counterparty nonperformance risk, including credit default swaps. The following table sets forth, by level within the fair value hierarchy, our financial assets and liabilities that were accounted for at fair value on a recurring basis as of the periods indicated: Fair Value Measurements Using: In thousands Quoted Prices Significant Significant Total September 30, 2023 Assets Oil derivative contracts – current $ — $ 98 $ — $ 98 Oil derivative contracts – long-term — 26 — 26 Total Assets $ — $ 124 $ — $ 124 Liabilities Oil derivative contracts – current $ — $ (40,813) $ — $ (40,813) Oil derivative contracts – long-term — (336) — (336) Total Liabilities $ — $ (41,149) $ — $ (41,149) December 31, 2022 Assets Oil derivative contracts – current $ — $ 15,517 $ — $ 15,517 Total Assets $ — $ 15,517 $ — $ 15,517 Liabilities Oil derivative contracts – current $ — $ (13,018) $ — $ (13,018) Total Liabilities $ — $ (13,018) $ — $ (13,018) Since we do not apply hedge accounting for our commodity derivative contracts, any gains and losses on our assets and liabilities are included in “Commodity derivatives expense (income)” in the accompanying Unaudited Condensed Consolidated Statements of Operations. Other Fair Value Measurements The carrying value of our loans under our Bank Credit Agreement approximate fair value, as they are subject to short-term floating interest rates that approximate the rates available to us for those periods. The estimated fair value of the principal amount of our debt as of September 30, 2023 and December 31, 2022, excluding financing lease obligations, was $70.0 million and $29.0 million, respectively. We have other financial instruments consisting primarily of cash, cash equivalents, U.S. Treasury notes, short-term receivables and payables that approximate fair value due to the nature of the instrument and the relatively short maturities. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 9. Commitments and Contingencies Litigation and Regulatory Proceedings We are involved in various lawsuits, claims and regulatory proceedings incidental to our businesses. We are also subject to audits for various taxes (income, sales and use, and severance) in the various states in which we operate, and from time to time receive assessments for potential taxes that we may owe. We accrue for losses from litigation and claims if we determine that a loss is probable and the amount can be reasonably estimated. On May 26, 2022, the Pipeline and Hazardous Materials Safety Administration (“PHMSA”) of the U.S. Department of Transportation issued a Notice of Probable Violation, Proposed Civil Penalty, and Proposed Compliance Order (“NOPV”) relating to the February 2020 CO 2 release from a pipeline failure near Satartia, Mississippi in our CO 2 pipeline running between the Tinsley and Delhi fields, and assessed a preliminary civil penalty of $3.9 million, which the Company recorded in its financial statements in the second quarter of 2022. On March 24, 2023, Denbury and PHMSA entered into a final Consent Order and Consent Agreement that settled all of the allegations in the NOPV and also reduced the assessed penalty to $2.9 million. The $1.0 million reduction was reflected in “Other expenses” in our Unaudited Condensed Consolidated Statements of Operations in the first quarter of 2023. |
Additional Balance Sheet Detail
Additional Balance Sheet Details | 9 Months Ended |
Sep. 30, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Additional Balance Sheet Details | Note 10. Additional Balance Sheet Details Trade and Other Receivables, Net In thousands September 30, 2023 December 31, 2022 Trade accounts receivable, net $ 15,904 $ 19,619 Federal income tax receivable, net — 597 Other receivables 2,335 7,127 Total $ 18,239 $ 27,343 |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2023 | Jun. 30, 2023 | Mar. 31, 2023 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Pay vs Performance Disclosure | ||||||||
Net income(loss) | $ (2,893) | $ 67,281 | $ 89,199 | $ 250,423 | $ 155,494 | $ (872) | $ 153,587 | $ 405,045 |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended |
Sep. 30, 2023 shares | |
Trading Arrangements, by Individual | |
Name | Nicole Jennings |
Title | Vice President and Chief Accounting Officer |
Rule 10b5-1 Arrangement Adopted | true |
Non-Rule 10b5-1 Arrangement Adopted | false |
Adoption Date | September 7, 2023 |
Rule 10b5-1 Arrangement Terminated | true |
Non-Rule 10b5-1 Arrangement Terminated | false |
Termination Date | November 2, 2023, |
Arrangement Duration | 64 days |
Aggregate Available | 56,542 |
Trading Arrangement, Restricted Stock Units [Member] | |
Trading Arrangements, by Individual | |
Aggregate Available | 28,479 |
Trading Arrangement, Performance Stock Units [Member] | |
Trading Arrangements, by Individual | |
Aggregate Available | 28,063 |
Basis of Presentation (Policies
Basis of Presentation (Policies) | 9 Months Ended |
Sep. 30, 2023 | |
Accounting Policies [Abstract] | |
Basis of Accounting | The accompanying unaudited condensed consolidated financial statements of Denbury Inc. and its subsidiaries have been prepared in accordance with the rules and regulations of the SEC and do not include all of the information and footnotes required by accounting principles generally accepted in the United States for complete financial statements. These financial statements and the notes thereto should be read in conjunction with our Annual Report on Form 10-K for the year ended December 31, 2022 (the “Form 10-K”). Unless indicated otherwise or the context requires, the terms “we,” “our,” “us,” “Company” or “Denbury,” refer to Denbury Inc. and its subsidiaries. |
Use of Estimates | Accounting measurements at interim dates inherently involve greater reliance on estimates than at year end, and the results of operations for the interim periods shown in this report are not necessarily indicative of results to be expected for the year. In management’s opinion, the accompanying unaudited condensed consolidated financial statements include all adjustments of a normal recurring nature necessary for a fair presentation of our consolidated financial position as of September 30, 2023, our consolidated results of operations for the three and nine months ended September 30, 2023 and 2022, our consolidated cash flows for the nine months ended September 30, 2023 and 2022, and our consolidated statements of changes in stockholders’ equity for the three and nine months ended September 30, 2023 and 2022. |
Reclassifications | Reclassifications Certain prior period amounts have been reclassified to conform to the current year presentation. Such reclassifications had no impact on our reported net income (loss), current assets, total assets, current liabilities, total liabilities or stockholders’ equity. |
Cash, Cash Equivalents, and Restricted Cash | Cash, Cash Equivalents, and Restricted Cash We consider all highly liquid investments to be cash equivalents if they have maturities of three months or less at the date of purchase. The following table provides a reconciliation of cash, cash equivalents, and restricted cash as reported within the Unaudited Condensed Consolidated Balance Sheets to “Cash, cash equivalents, and restricted cash at end of period” as reported within the Unaudited Condensed Consolidated Statements of Cash Flows: In thousands September 30, 2023 September 30, 2022 Cash and cash equivalents $ 803 $ 519 Restricted cash for future asset retirement obligations 49,027 47,633 Total cash, cash equivalents, and restricted cash shown in the Unaudited Condensed Consolidated Statements of Cash Flows $ 49,830 $ 48,152 Restricted cash for future asset retirement obligations in the table above consists of escrow accounts that are legally restricted for certain of our asset retirement obligations. |
Net Income (Loss) per Common Share | Net Income (Loss) per Common Share Basic net income (loss) per common share is computed by dividing the net income (loss) attributable to common stockholders by the weighted average number of shares of common stock outstanding during the period. Basic weighted average common shares exclude shares of nonvested restricted stock (although nonvested restricted stock is issued and outstanding upon grant). As these restricted shares vest, they will be included in the shares outstanding used to calculate basic net income (loss) per common share. Restricted stock units and performance stock units are also excluded from basic weighted average common shares outstanding until the vesting date. Basic weighted average common shares during the three and nine months ended September 30, 2023 includes 1,775,182 performance-based and restricted stock units which are fully vested as of September 30, 2023; however, the shares underlying these awards are not included in shares currently issued or outstanding as actual delivery of the shares had not occurred as of September 30, 2023. Diluted net income (loss) per common share is calculated in the same manner but includes the impact of all potentially dilutive securities. Potentially dilutive securities include restricted stock, restricted stock units, performance stock units, shares to be issued under the employee stock purchase plan (“ESPP”), and warrants . |
Oil and Natural Gas Properties | Oil and Natural Gas Properties Write-Down of Oil and Natural Gas Properties. Under full cost accounting, the net capitalized costs of oil and natural gas properties are limited to the lower of unamortized cost or the cost center ceiling. The cost center ceiling is defined as (1) the present value of estimated future net revenues from proved oil and natural gas reserves before future abandonment costs (discounted at 10%), based on the average first-day-of-the-month oil and natural gas price for each month during a 12-month rolling period prior to the end of a particular reporting period; plus (2) the cost of properties not being amortized; plus (3) the lower of cost or estimated fair value of unproved properties included in the costs being amortized, if any; less (4) related income tax effects. Our future net revenues from proved oil and natural gas reserves are not reduced for development costs related to the cost of drilling for and developing CO 2 reserves nor those related to the cost of constructing CO 2 pipelines, as we do not have to incur additional CO 2 capital costs to develop the proved oil and natural gas reserves. Therefore, we include in the ceiling test, as a reduction of future net revenues, that portion of our capitalized CO 2 costs related to CO 2 reserves and CO 2 pipelines that we estimate will be consumed in the process of producing our proved oil and natural gas reserves. The fair value of our oil and natural gas derivative contracts is not included in the ceiling test, as we do not designate these contracts as hedge instruments for accounting purposes. The cost center ceiling test is prepared quarterly. We did not record a ceiling test write-down during the three or nine months ended September 30, 2023 or September 30, 2022. |
Equity Method Investments | Equity Method InvestmentsIn accordance with equity method accounting, we record our initial equity investments at cost and periodically adjust the value of the investment balance to recognize (1) the proportionate share of the investee’s net income or losses after the date of investment, (2) additional contributions made and dividends or distributions received, and (3) impairment losses resulting from adjustments to net realizable value. The investments are included in “Other assets” in the Unaudited Condensed Consolidated Balance Sheets as of September 30, 2023. We evaluate our equity method investments for other-than-temporary impairment on a periodic basis. |
Revenue Recognition | We record revenue in accordance with Financial Accounting Standards Board (“FASB”) Codification (“FASC”) Topic 606, Revenue from Contracts with Customers . The core principle of FASC Topic 606 is that an entity should recognize revenue for the transfer of goods or services equal to the amount of consideration that it expects to be entitled to receive for those goods or services. Once we have delivered the volume of commodity to the delivery point and the customer takes delivery and possession, we are entitled to payment and we invoice the customer for such delivered production. Payment under most oil and CO 2 contracts is received within one month following product delivery, and for natural gas and NGL contracts, payment is generally received within two months following delivery. Timing of revenue recognition may differ from the timing of invoicing to customers; however, as the right to consideration after delivery is unconditional based on only the passage of time before payment of the consideration is due, upon delivery we record a receivable in “Accrued production receivable” in our Unaudited Condensed Consolidated Balance Sheets. In certain situations, the Company enters into marketing arrangements for the purchase and subsequent sale of crude oil from third parties. We recognize the revenue received and the associated expense incurred on these sales on a gross basis, as “Oil marketing revenues” and “Oil marketing purchases” in our Unaudited Condensed Consolidated Statements of Operations, since we act as a principal in the transaction by assuming control of the commodities purchased and responsibility to deliver the commodities sold. Revenue is recognized when control transfers to the purchaser at the delivery point based on the price received from the purchaser. |
Income Taxes | We make estimates and judgments in determining our income tax expense for financial reporting purposes. These estimates and judgments occur in the calculation of certain tax assets and liabilities that arise from differences in the timing and recognition of revenue and expense for tax and financial reporting purposes. Significant judgment is required in estimating valuation allowances, and in making this determination we consider all available positive and negative evidence and make certain assumptions. The realization of a deferred tax asset ultimately depends on the existence of sufficient taxable income in the applicable carryback or carryforward periods. In our assessment, we consider the nature, frequency, and severity of current and cumulative losses, as well as historical and forecasted financial results, the overall business environment, our industry’s historic cyclicality, the reversal of existing deferred tax assets and liabilities, and tax planning strategies.We evaluate our estimated annual effective income tax rate based on current and forecasted business results and enacted tax laws on a quarterly basis and apply this tax rate to our ordinary income or loss to calculate our estimated tax liability or benefit. Our income taxes are based on an estimated combined federal and state statutory rate of approximately 25% in 2023 and 2022. |
Commodity Derivative Contracts | We do not apply hedge accounting treatment to our oil and natural gas derivative contracts; therefore, the changes in the fair values of these instruments are recognized in income in the period of change. These fair value changes, along with the settlements of expired contracts, are shown under “Commodity derivatives expense (income)” in our Unaudited Condensed Consolidated Statements of Operations. Historically, we have entered into various oil and natural gas derivative contracts to provide an economic hedge of our exposure to commodity price risk associated with anticipated future oil and natural gas production and to provide more certainty to our future cash flows. We do not hold or issue derivative financial instruments for trading purposes. Over the last few years these contracts have consisted of fixed-price swaps and costless collars. The production we hedge has varied from year to year depending on our levels of debt, financial strength and expectation of future commodity prices, and occasionally requirements under our bank credit facility. We currently have no hedging requirements under our bank credit facility. We manage and control market and counterparty credit risk through established internal control procedures that are reviewed on an ongoing basis. We attempt to minimize credit risk exposure to counterparties through formal credit policies, monitoring procedures and diversification, and all of our commodity derivative contracts are with parties that are lenders under our Bank Credit Agreement (or affiliates of such lenders). As of September 30, 2023, all of our outstanding derivative contracts were subject to enforceable master netting arrangements whereby payables on those contracts can be offset against receivables from separate derivative contracts with the same counterparty. It is our policy to classify derivative assets and liabilities on a gross basis on our balance sheets, even if the contracts are subject to enforceable master netting arrangements. The following table summarizes our commodity derivative contracts as of September 30, 2023, none of which are classified as hedging instruments in accordance with the FASC Derivatives and Hedging topic: Months Index Price Volume (Barrels per day) Contract Prices ($/Bbl) Weighted Average Price Swap Floor Ceiling Oil Contracts: 2023 Fixed-Price Swaps Oct – Dec NYMEX 18,000 $ 78.51 $ — $ — 2023 Collars Oct – Dec NYMEX 9,000 $ — $ 68.33 $ 100.69 2024 Fixed-Price Swaps Jan – June NYMEX 19,000 $ 75.36 $ — $ — July – Dec NYMEX 3,000 76.50 — — On October 24, 2023, the Company and the counterparties to all of our outstanding derivative contracts mutually agreed to terminate the contracts, resulting in a cash payment by the Company to the counterparties aggregating $26.9 million. |
Fair Value Measurements | The FASC Fair Value Measurement topic defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (often referred to as the “exit price”). We utilize market data or assumptions that market participants would use in pricing the asset or liability, including assumptions about risk and the risks inherent in the inputs to the valuation technique. These inputs can be readily observable, market corroborated or generally unobservable. We primarily apply the income approach for recurring fair value measurements and endeavor to utilize the best available information. Accordingly, we utilize valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs. We are able to classify fair value balances based on the observability of those inputs. The FASC establishes a fair value hierarchy that prioritizes the inputs used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurement) and the lowest priority to unobservable inputs (Level 3 measurement). The three levels of the fair value hierarchy are as follows: • Level 1 – Quoted prices in active markets for identical assets or liabilities as of the reporting date. • Level 2 – Pricing inputs are other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reported date. Level 2 includes those financial instruments that are valued using models or other valuation methodologies. Instruments in this category include non-exchange-traded oil derivatives that are based on NYMEX. Our costless collars are valued using the Black-Scholes model, an industry standard option valuation model that takes into account inputs such as contractual prices for the underlying instruments, maturity, quoted forward prices for commodities, interest rates, volatility factors and credit worthiness, as well as other relevant economic measures. Substantially all of these assumptions are observable in the marketplace throughout the full term of the instrument, can be derived from observable data or are supported by observable levels at which transactions are executed in the marketplace. • Level 3 – Pricing inputs include significant inputs that are generally less observable. These inputs may be used with internally developed methodologies that result in management’s best estimate of fair value. We adjust the valuations from the valuation model for nonperformance risk, using our estimate of the counterparty’s credit quality for asset positions and our credit quality for liability positions. We use multiple sources of third-party credit data in determining counterparty nonperformance risk, including credit default swaps. |
Basis of Presentation (Tables)
Basis of Presentation (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Accounting Policies [Abstract] | |
Schedule of Cash and Cash Equivalents | The following table provides a reconciliation of cash, cash equivalents, and restricted cash as reported within the Unaudited Condensed Consolidated Balance Sheets to “Cash, cash equivalents, and restricted cash at end of period” as reported within the Unaudited Condensed Consolidated Statements of Cash Flows: In thousands September 30, 2023 September 30, 2022 Cash and cash equivalents $ 803 $ 519 Restricted cash for future asset retirement obligations 49,027 47,633 Total cash, cash equivalents, and restricted cash shown in the Unaudited Condensed Consolidated Statements of Cash Flows $ 49,830 $ 48,152 |
Schedule of Restricted Cash and Cash Equivalents | The following table provides a reconciliation of cash, cash equivalents, and restricted cash as reported within the Unaudited Condensed Consolidated Balance Sheets to “Cash, cash equivalents, and restricted cash at end of period” as reported within the Unaudited Condensed Consolidated Statements of Cash Flows: In thousands September 30, 2023 September 30, 2022 Cash and cash equivalents $ 803 $ 519 Restricted cash for future asset retirement obligations 49,027 47,633 Total cash, cash equivalents, and restricted cash shown in the Unaudited Condensed Consolidated Statements of Cash Flows $ 49,830 $ 48,152 |
Schedule of Net Loss Per Share, Basic and Diluted | The following table sets forth the weighted average shares used for purposes of calculating basic and diluted net income (loss) per common share for the periods indicated: Three Months Ended Nine Months Ended September 30, September 30, In thousands 2023 2022 2023 2022 Weighted average common shares outstanding – basic 52,417 51,182 51,916 51,512 Effect of potentially dilutive securities Restricted stock, restricted stock units and performance stock units — 664 440 615 Warrants — 1,869 1,584 2,397 Employee Stock Purchase Plan — — 1 — Weighted average common shares outstanding – diluted 52,417 53,715 53,941 54,524 |
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | The following outstanding securities were excluded from the computation of diluted net income (loss) per share for the three months ended September 30, 2023 and September 30, 2022, as their effect would have been antidilutive, as of the respective dates: September 30, In thousands 2023 2022 Restricted stock, restricted stock units and performance stock units (1) 966 196 Warrants 992 — Employee Stock Purchase Plan 6 8 (1) Antidilutive shares for the three-month periods ended September 30, 2023 and 2022 reflect total shares excluded from the computation of diluted net income per share that are potentially dilutive in the future, assuming performance stock units at the target level. Shares disclosed for the period ended September 30, 2022 have been revised to be consistent with the current year presentation. |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Disaggregation of Revenue | The following table summarizes our revenues by product type for the three and nine months ended September 30, 2023 and 2022: Three Months Ended Nine Months Ended September 30, September 30, In thousands 2023 2022 2023 2022 Oil sales $ 324,236 $ 389,543 $ 938,351 $ 1,217,377 Natural gas sales 1,634 5,680 4,954 14,727 CO 2 sales and transportation fees 12,706 18,586 34,556 44,618 Oil marketing revenues 15,820 17,663 44,351 47,725 Total revenues $ 354,396 $ 431,472 $ 1,022,212 $ 1,324,447 |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Debt Disclosure [Abstract] | |
Schedule of Long-Term Debt Outstanding | The table below reflects long-term debt outstanding as of the dates indicated: In thousands September 30, 2023 December 31, 2022 Senior Secured Bank Credit Agreement $ 70,000 $ 29,000 Finance lease obligations 349 — Total debt principal balance 70,349 29,000 Less: current maturities of long-term debt (13) — Long-term debt and finance lease obligations $ 70,336 $ 29,000 |
Investments (Tables)
Investments (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Schedule of Equity Method Investments | Our equity-method investments and their book value balances consisted of the following: In thousands September 30, 2023 December 31, 2022 Equity method investments (1) Clean Hydrogen Works, LA-1, L.L.C. $ 20,000 $ 10,218 Libra CO 2 Storage Solutions LLC 1,926 — Total equity method investments $ 21,926 $ 10,218 (1) Investment balances include capitalized transaction costs. |
Commodity Derivative Contracts
Commodity Derivative Contracts (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Commodity Derivative Contracts Not Classified as Hedging Instruments | The following table summarizes our commodity derivative contracts as of September 30, 2023, none of which are classified as hedging instruments in accordance with the FASC Derivatives and Hedging topic: Months Index Price Volume (Barrels per day) Contract Prices ($/Bbl) Weighted Average Price Swap Floor Ceiling Oil Contracts: 2023 Fixed-Price Swaps Oct – Dec NYMEX 18,000 $ 78.51 $ — $ — 2023 Collars Oct – Dec NYMEX 9,000 $ — $ 68.33 $ 100.69 2024 Fixed-Price Swaps Jan – June NYMEX 19,000 $ 75.36 $ — $ — July – Dec NYMEX 3,000 76.50 — — |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair value Hierarchy of Financial Assets and Liabilities | The following table sets forth, by level within the fair value hierarchy, our financial assets and liabilities that were accounted for at fair value on a recurring basis as of the periods indicated: Fair Value Measurements Using: In thousands Quoted Prices Significant Significant Total September 30, 2023 Assets Oil derivative contracts – current $ — $ 98 $ — $ 98 Oil derivative contracts – long-term — 26 — 26 Total Assets $ — $ 124 $ — $ 124 Liabilities Oil derivative contracts – current $ — $ (40,813) $ — $ (40,813) Oil derivative contracts – long-term — (336) — (336) Total Liabilities $ — $ (41,149) $ — $ (41,149) December 31, 2022 Assets Oil derivative contracts – current $ — $ 15,517 $ — $ 15,517 Total Assets $ — $ 15,517 $ — $ 15,517 Liabilities Oil derivative contracts – current $ — $ (13,018) $ — $ (13,018) Total Liabilities $ — $ (13,018) $ — $ (13,018) |
Additional Balance Sheet Deta_2
Additional Balance Sheet Details (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Trade and Other Receivables, Net | Trade and Other Receivables, Net In thousands September 30, 2023 December 31, 2022 Trade accounts receivable, net $ 15,904 $ 19,619 Federal income tax receivable, net — 597 Other receivables 2,335 7,127 Total $ 18,239 $ 27,343 |
Basis of Presentation (Narrativ
Basis of Presentation (Narrative) (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 9 Months Ended | ||||
Nov. 02, 2023 | Oct. 31, 2023 | Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Common stock, par value (in dollars per shares) | $ 0.001 | $ 0.001 | $ 0.001 | ||||
Weighted average common shares outstanding – basic (in shares) | 52,417,000 | 51,182,000 | 51,916,000 | 51,512,000 | |||
Number of warrants exercised (in shares) | 2,700,000 | 2,700,000 | |||||
Write-down of oil and natural gas properties | $ 0 | $ 0 | $ 0 | $ 0 | |||
Subsequent Event | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Common stock, par value (in dollars per shares) | $ 0.001 | ||||||
Subsequent Event | Exxon Mobil Corporation | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Number of shares that can be received (in shares) | 0.840 | ||||||
Series A Warrants | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Number of warrants outstanding (in shares) | 1,000,000 | 1,000,000 | |||||
Exercise price of warrants (in dollars per share) | $ 32.59 | $ 32.59 | |||||
Number of warrants exercised (in shares) | 1,600,000 | 1,600,000 | |||||
Series A Warrants | Subsequent Event | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Number of warrants exercised (in shares) | 1,000,000 | ||||||
Issued pursuant to exercise of warrants (in shares) | 800,000 | ||||||
Series B Warrants | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Number of warrants exercised (in shares) | 2,700,000 | 2,700,000 | |||||
Performance-based and restricted stock units | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Weighted average common shares outstanding – basic (in shares) | 1,775,182 | 1,775,182 |
Basis of Presentation (Cash, Ca
Basis of Presentation (Cash, Cash Equivalents, and Restricted Cash) (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 | Sep. 30, 2022 | Dec. 31, 2021 |
Accounting Policies [Abstract] | ||||
Cash and cash equivalents | $ 803 | $ 521 | $ 519 | |
Restricted cash for future asset retirement obligations | 49,027 | 47,359 | 47,633 | |
Total cash, cash equivalents, and restricted cash shown in the Unaudited Condensed Consolidated Statements of Cash Flows | $ 49,830 | $ 47,880 | $ 48,152 | $ 50,344 |
Basis of Presentation (Schedule
Basis of Presentation (Schedule of Earnings Per Share Basic and Diluted) (Details) - shares shares in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Weighted average common shares outstanding – basic (in shares) | 52,417 | 51,182 | 51,916 | 51,512 |
Effect of potentially dilutive securities - Warrants (in shares) | 0 | 1,869 | 1,584 | 2,397 |
Weighted average common shares outstanding – diluted (in shares) | 52,417 | 53,715 | 53,941 | 54,524 |
Restricted stock, restricted stock units and performance stock units | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Effect of potentially dilutive securities - Share-based payment (in shares) | 0 | 664 | 440 | 615 |
Employee Stock Purchase Plan | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Effect of potentially dilutive securities - Share-based payment (in shares) | 0 | 0 | 1 | 0 |
Basis of Presentation (Antidilu
Basis of Presentation (Antidilutive Securities) (Details) - shares shares in Thousands | Sep. 30, 2023 | Sep. 30, 2022 |
Restricted stock, restricted stock units and performance stock units | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Number of antidilutive equity-based instruments outstanding (in shares) | 966 | 196 |
Warrants | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Number of antidilutive equity-based instruments outstanding (in shares) | 992 | 0 |
Employee Stock Purchase Plan | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Number of antidilutive equity-based instruments outstanding (in shares) | 6 | 8 |
Revenue Recognition (Disaggrega
Revenue Recognition (Disaggregation of Revenue) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Disaggregation of Revenue [Line Items] | ||||
Revenues | $ 354,396 | $ 431,472 | $ 1,022,212 | $ 1,324,447 |
Oil sales | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 324,236 | 389,543 | 938,351 | 1,217,377 |
Natural gas sales | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 1,634 | 5,680 | 4,954 | 14,727 |
CO2 sales and transportation fees | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 12,706 | 18,586 | 34,556 | 44,618 |
Oil marketing revenues | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | $ 15,820 | $ 17,663 | $ 44,351 | $ 47,725 |
Long-Term Debt (Schedule of Lon
Long-Term Debt (Schedule of Long-Term Debt Outstanding) (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Debt Disclosure [Abstract] | ||
Senior Secured Bank Credit Agreement | $ 70,000 | $ 29,000 |
Finance lease obligations | 349 | 0 |
Total debt principal balance | 70,349 | 29,000 |
Less: current maturities of long-term debt | (13) | 0 |
Long-term debt and finance lease obligations | $ 70,336 | $ 29,000 |
Long-Term Debt (Narrative) (Det
Long-Term Debt (Narrative) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Debt Instrument [Line Items] | ||||
Interest paid | $ 2.8 | $ 1.4 | $ 7.5 | $ 3.8 |
Senior Secured Bank Credit Agreement | ||||
Debt Instrument [Line Items] | ||||
Commitment fee percentage | 0.50% | |||
Amount of letter of credit posted as security | 10.4 | $ 10.4 | ||
Borrowing base | $ 75 | $ 75 | ||
Senior Secured Bank Credit Agreement | Weighted Average | ||||
Debt Instrument [Line Items] | ||||
Weighted average interest rate | 8.20% |
Investments (Schedule of Equity
Investments (Schedule of Equity Method Investments) (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Apr. 30, 2023 | Dec. 31, 2022 |
Schedule of Equity Method Investments [Line Items] | |||
Equity method investments | $ 21,926 | $ 10,218 | |
Clean Hydrogen Works, LA-1, L.L.C. | |||
Schedule of Equity Method Investments [Line Items] | |||
Equity method investments | 20,000 | $ 20,000 | 10,218 |
Libra CO2 Storage Solutions LLC | |||
Schedule of Equity Method Investments [Line Items] | |||
Equity method investments | $ 1,926 | $ 0 |
Investments (Narrative) (Detail
Investments (Narrative) (Details) $ in Thousands | 1 Months Ended | 3 Months Ended | 9 Months Ended | |||
Apr. 30, 2023 USD ($) plant | Jun. 30, 2023 USD ($) | Mar. 31, 2023 USD ($) investment | Sep. 30, 2023 USD ($) | Sep. 30, 2022 USD ($) | Dec. 31, 2022 USD ($) | |
Schedule of Equity Method Investments [Line Items] | ||||||
Payments to acquire equity method investments | $ 18,817 | $ 10,000 | ||||
Equity method investments | 21,926 | $ 10,218 | ||||
Number of blocks | plant | 2 | |||||
Number of investment | investment | 2 | |||||
Clean Hydrogen Works, LA-1, L.L.C. | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Payments to acquire equity method investments | $ 10,000 | |||||
Equity method investments | $ 20,000 | 20,000 | 10,218 | |||
Equity method investment, difference between carrying amount and underlying equity | 17,700 | |||||
Libra, CO2 Storage Solutions, LLC | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Payments to acquire equity method investments | $ 1,500 | |||||
Equity method investments | $ 1,926 | $ 0 | ||||
Aqualung Carbon Capture AS | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Payments to acquire other investments | $ 2,000 | |||||
ION Clean Energy, Inc, | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Payments to acquire other investments | $ 5,000 |
Stockholders' Equity (Narrative
Stockholders' Equity (Narrative) (Details) - USD ($) | 2 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | 14 Months Ended | |||
Jul. 31, 2022 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Sep. 30, 2023 | Dec. 31, 2022 | Sep. 30, 2023 | May 31, 2022 | |
Stockholders' Equity Note [Abstract] | ||||||||
Authorized amount under share repurchase program | $ 250,000,000 | |||||||
Shares repurchased under share repurchase program (in shares) | 1,615,356 | 0 | ||||||
Stock repurchase program | $ 100,000,000 | $ 71,277,000 | $ 28,751,000 | |||||
Average cost per share of shares repurchased under share repurchase program (in dollars per share) | $ 61.92 | |||||||
Retired treasury shares (in shares) | 16,281 | 1,600,000 | ||||||
Treasury stock retired | $ 1,400,000 | $ 100,000,000 | ||||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||||||
Tax withholding for stock compensation plans, value | $ 5,000 | $ 58,000 | ||||||
Restricted stock units | ||||||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||||||
Tax withholding for stock compensation plans, value | $ 1,300,000 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Millions | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | |
Valuation Allowance [Line Items] | |||
Valuation allowance | $ 59.2 | ||
Federal and state statutory tax rate (as a percent) | 25% | 25% | |
Louisiana | |||
Valuation Allowance [Line Items] | |||
Deferred tax assets | 55.4 | ||
Alabama and Mississippi | |||
Valuation Allowance [Line Items] | |||
Deferred tax assets | $ 3.8 |
Commodity Derivative Contract_2
Commodity Derivative Contracts (Details) $ in Millions | Oct. 24, 2023 USD ($) | Sep. 30, 2023 bbl / d $ / Barrel |
Subsequent Event | ||
Derivative [Line Items] | ||
Payments for derivative contracts | $ | $ 26.9 | |
NYMEX | Swap | Q3-Q4 2023 | ||
Derivative [Line Items] | ||
Volume per day (Barrels per day) | bbl / d | 18,000 | |
Weighted average swap price (in dollars per Barrel) | 78.51 | |
NYMEX | Swap | Q1 - Q2 2024 | ||
Derivative [Line Items] | ||
Volume per day (Barrels per day) | bbl / d | 19,000 | |
Weighted average swap price (in dollars per Barrel) | 75.36 | |
NYMEX | Swap | Q3- Q4 2024 | ||
Derivative [Line Items] | ||
Volume per day (Barrels per day) | bbl / d | 3,000 | |
Weighted average swap price (in dollars per Barrel) | 76.50 | |
NYMEX | Collar | Q3-Q4 2023 | ||
Derivative [Line Items] | ||
Volume per day (Barrels per day) | bbl / d | 9,000 | |
Weighted average floor price (in dollars per Barrel) | 68.33 | |
Weighted average ceiling price (in dollars per Barrel) | 100.69 |
Fair Value Measurements (Fair v
Fair Value Measurements (Fair value Hierarchy of Financial Assets and Liabilities) (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Oil derivative contracts – current | $ 98 | $ 15,517 |
Oil derivative contracts – long-term | 26 | 0 |
Total Assets | 124 | 15,517 |
Oil derivative contracts – current | (40,813) | (13,018) |
Oil derivative contracts – long-term | (336) | 0 |
Total Liabilities | (41,149) | (13,018) |
Quoted Prices in Active Markets (Level 1) | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Oil derivative contracts – current | 0 | 0 |
Oil derivative contracts – long-term | 0 | |
Total Assets | 0 | 0 |
Oil derivative contracts – current | 0 | 0 |
Oil derivative contracts – long-term | 0 | |
Total Liabilities | 0 | 0 |
Significant Other Observable Inputs (Level 2) | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Oil derivative contracts – current | 98 | 15,517 |
Oil derivative contracts – long-term | 26 | |
Total Assets | 124 | 15,517 |
Oil derivative contracts – current | (40,813) | (13,018) |
Oil derivative contracts – long-term | (336) | |
Total Liabilities | (41,149) | (13,018) |
Significant Unobservable Inputs (Level 3) | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Oil derivative contracts – current | 0 | 0 |
Oil derivative contracts – long-term | 0 | |
Total Assets | 0 | 0 |
Oil derivative contracts – current | 0 | 0 |
Oil derivative contracts – long-term | 0 | |
Total Liabilities | $ 0 | $ 0 |
Fair Value Measurements (Narrat
Fair Value Measurements (Narrative) (Details) - USD ($) $ in Millions | Sep. 30, 2023 | Dec. 31, 2022 |
Fair Value Disclosures [Abstract] | ||
Fair value of debt | $ 70 | $ 29 |
Commitment and Contingencies (D
Commitment and Contingencies (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2023 | Mar. 24, 2023 | Jun. 30, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |||
Preliminary assessed civil penalty | $ 3.9 | ||
Final penalty assessed | $ 2.9 | ||
Decrease in loss contingencies | $ 1 |
Additional Balance Sheet (Detai
Additional Balance Sheet (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Trade accounts receivable, net | $ 15,904 | $ 19,619 |
Federal income tax receivable, net | 0 | 597 |
Other receivables | 2,335 | 7,127 |
Total | $ 18,239 | $ 27,343 |