Quarterly report pursuant to Section 13 or 15(d)

Income Taxes

 v2.3.0.11
Income Taxes
6 Months Ended
Jun. 30, 2011
Income Taxes [Abstract]  
Income Taxes
Note 8 — Income Taxes
          The following table presents Callon’s net unrecognized tax benefits relating to its reported net losses and other temporary differences from operations:
                 
    June 30, 2011     December 31, 2010  
Deferred tax asset:
               
Federal net operating loss carryforward
  $ 74,305     $ 79,680  
Statutory depletion carryforward
    6,997       6,140  
Alternative minimum tax credit carryforward
    209       208  
Asset retirement obligations
    3,482       4,018  
Other
    14,195       16,807  
 
           
Deferred tax asset before valuation allowance
    99,188       106,853  
Less: Valuation allowance
    (74,583 )     (85,222 )
 
           
Total deferred tax asset
    24,605       21,631  
 
           
Deferred tax liability:
               
Oil and gas properties
    24,605       21,631  
 
           
Total deferred tax liability
    24,605       21,631  
 
           
Net deferred tax asset
  $     $  
 
           
          In assessing the realizability of deferred tax assets, the Company considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. The Company considers the scheduled expiration of deferred tax assets, projected future taxable income and tax planning strategies in making this assessment. Following an impairment of oil and gas properties recorded during the fourth quarter of 2008, the Company remains in a three-year cumulative loss position as of June 30, 2011. Accordingly, the Company continues to carry a full valuation allowance against its net deferred tax assets, which will affect the Company’s effective tax rate in future periods to the extent these deferred tax assets are recognized.