Quarterly report pursuant to Section 13 or 15(d)

Derivative Instruments and Hedging Activities (Tables)

v3.22.2.2
Derivative Instruments and Hedging Activities (Tables)
 9 Months Ended
Sep. 30, 2022
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Schedule of Offsetting Assets The following presents the impact of this presentation to the Company’s recognized assets and liabilities for the periods indicated:
As of September 30, 2022
Presented without   As Presented with
Effects of Netting Effects of Netting Effects of Netting
(In thousands)
Derivative Assets
Fair value of derivatives - current $74,016  ($59,272) $14,744 
Other assets, net $13,520  ($12,131) $1,389 
Derivative Liabilities      
Fair value of derivatives - current ($107,969) $59,272  ($48,697)
Fair value of derivatives - non-current ($21,735) $12,131  ($9,604)

As of December 31, 2021
Presented without   As Presented with
Effects of Netting Effects of Netting Effects of Netting
(In thousands)
Assets
Commodity derivative instruments $25,469  ($23,921) $1,548 
Contingent consideration arrangements 20,833  —  20,833 
Fair value of derivatives - current $46,302  ($23,921) $22,381 
Commodity derivative instruments $1,119  ($869) $250 
Contingent consideration arrangements —  —  — 
Other assets, net $1,119  ($869) $250 
Liabilities      
Commodity derivative instruments (1)
($184,898) $23,921  ($160,977)
Contingent consideration arrangements (25,000) —  (25,000)
Fair value of derivatives - current ($209,898) $23,921  ($185,977)
Commodity derivative instruments ($12,278) $869  ($11,409)
Contingent consideration arrangements —  —  — 
Fair value of derivatives - non-current ($12,278) $869  ($11,409)
(1)    Includes approximately $2.9 million of deferred premiums, which will be paid as the applicable contracts settle.
Schedule of Offsetting Liabilities The following presents the impact of this presentation to the Company’s recognized assets and liabilities for the periods indicated:
As of September 30, 2022
Presented without   As Presented with
Effects of Netting Effects of Netting Effects of Netting
(In thousands)
Derivative Assets
Fair value of derivatives - current $74,016  ($59,272) $14,744 
Other assets, net $13,520  ($12,131) $1,389 
Derivative Liabilities      
Fair value of derivatives - current ($107,969) $59,272  ($48,697)
Fair value of derivatives - non-current ($21,735) $12,131  ($9,604)

As of December 31, 2021
Presented without   As Presented with
Effects of Netting Effects of Netting Effects of Netting
(In thousands)
Assets
Commodity derivative instruments $25,469  ($23,921) $1,548 
Contingent consideration arrangements 20,833  —  20,833 
Fair value of derivatives - current $46,302  ($23,921) $22,381 
Commodity derivative instruments $1,119  ($869) $250 
Contingent consideration arrangements —  —  — 
Other assets, net $1,119  ($869) $250 
Liabilities      
Commodity derivative instruments (1)
($184,898) $23,921  ($160,977)
Contingent consideration arrangements (25,000) —  (25,000)
Fair value of derivatives - current ($209,898) $23,921  ($185,977)
Commodity derivative instruments ($12,278) $869  ($11,409)
Contingent consideration arrangements —  —  — 
Fair value of derivatives - non-current ($12,278) $869  ($11,409)
(1)    Includes approximately $2.9 million of deferred premiums, which will be paid as the applicable contracts settle.
Schedule of Gain or Loss on Derivative Contracts
The components of “(Gain) loss on derivative contracts” are as follows for the respective periods:
Three Months Ended September 30, Nine Months Ended September 30,
2022 2021 2022 2021
(In thousands)
(Gain) loss on oil derivatives ($157,731) $67,198  $243,527  $393,792 
Loss on natural gas derivatives 22,881  33,026  56,800  48,539 
Loss on NGL derivatives —  10,242  4,771  15,114 
Gain on contingent consideration arrangements —  (3,297) —  (680)
Loss on September 2020 Warrants liability (1)
—  —  —  55,390 
(Gain) loss on derivative contracts ($134,850) $107,169  $305,098  $512,155 
(1)    Further details of the Company’s September 2020 Warrants and the loss on the associated September 2020 Warrants liability are described in “Note 7 - Borrowings”, “Note 8 - Derivative Instruments and Hedging Activities” and “Note 9 - Fair Value Measurements” of the Notes to Consolidated Financial Statements in its 2021 Annual Report.
Schedule of Derivative Instruments
The components of “Cash paid for commodity derivative settlements, net” and “Cash received (paid) for settlements of contingent consideration arrangements, net” are as follows for the respective periods:
Three Months Ended September 30, Nine Months Ended September 30,
2022 2021 2022 2021
(In thousands)
Cash flows from operating activities        
Cash paid on oil derivatives ($117,024) ($98,752) ($374,711) ($221,112)
Cash paid on natural gas derivatives (28,572) (9,592) (55,024) (12,867)
Cash paid on NGL derivatives —  (2,463) (3,783) (4,399)
Cash paid for commodity derivative settlements, net ($145,596) ($110,807) ($433,518) ($238,378)
Cash received for settlements of contingent consideration arrangements, net $—  $—  $6,492  $— 
Cash flows from investing activities        
Cash paid for settlement of contingent consideration arrangement $—  $—  ($19,171) $— 
Cash flows from financing activities
Cash received for settlement of contingent consideration arrangement $—  $—  $8,512  $— 
Schedule of Outstanding Oil and Natural Gas Derivative Contracts
Listed in the tables below are the outstanding oil and natural gas derivative contracts as of September 30, 2022:
For the Remainder For the Full Year For the Full Year
Oil Contracts (WTI) 2022 2023 2024
Swap Contracts
Total volume (Bbls) 1,978,000  1,722,500  — 
Weighted average price per Bbl $67.29  $81.46  $— 
Collar Contracts (Three-Way Collars)
Total volume (Bbls) —  1,825,000  — 
Weighted average price per Bbl
Ceiling (short call) $—  $90.00  $— 
Floor (long put) $—  $70.00  $— 
Floor (short put) $—  $50.00  $— 
Collar Contracts (Two-Way Collars)
Total volume (Bbls) 1,196,000  2,730,000  — 
Weighted average price per Bbl
Ceiling (short call) $70.12  $87.15  $— 
Floor (long put) $60.00  $71.92  $— 
Short Call Swaption Contracts (1)
Total volume (Bbls) —  —  1,830,000 
Weighted average price per Bbl $—  $—  $80.30 
Oil Contracts (Midland Basis Differential)
Swap Contracts
Total volume (Bbls) 598,000  —  — 
Weighted average price per Bbl $0.50  $—  $— 
(1)    The 2024 short call swaption contracts have exercise expiration dates of December 29, 2023.
For the Remainder For the Full Year
Natural Gas Contracts (Henry Hub) 2022 2023
Swap Contracts
Total volume (MMBtu) 1,550,000  — 
Weighted average price per MMBtu $3.62  $— 
Collar Contracts
Total volume (MMBtu) 3,670,000  6,640,000 
Weighted average price per MMBtu
Ceiling (short call) $6.91  $6.60 
Floor (long put) $4.67  $4.48 
Natural Gas Contracts (Waha Basis Differential)
Swap Contracts
Total volume (MMBtu) 1,220,000  6,080,000 
Weighted average price per MMBtu ($0.75) ($0.75)