Quarterly report pursuant to Section 13 or 15(d)

Supplemental Guarantor Information

v2.4.0.8
Supplemental Guarantor Information
6 Months Ended
Jun. 30, 2014
Supplemental Guarantor Information

W&T OFFSHORE, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)

 

13.  Supplemental Guarantor Information

Our payment obligations under the 8.50% Senior Notes and the Credit Agreement (see Note 5) are fully and unconditionally guaranteed by certain of our wholly-owned subsidiaries, including W&T Energy VI, LLC and W&T Energy VII, LLC (together, the “Guarantor Subsidiaries”).  W&T Energy VII, LLC does not currently have any active operations or contain any assets.  Guarantees of the 8.50% Senior Notes will be released under certain circumstances, including:

(1) in connection with any sale or other disposition of all or substantially all of the assets of a Guarantor Subsidiary (including by way of merger or consolidation) to a person that is not (either before or after giving effect to such transaction) the Company or a Restricted Subsidiary (as such term is defined in the indenture governing the 8.50% Senior Notes) of the Company, if the sale or other disposition does not violate the “Asset Sales” provisions of the indenture;

(2) in connection with any sale or other disposition of the capital stock of such Guarantor Subsidiary to a person that is not (either before or after giving effect to such transaction) the Company or a Restricted Subsidiary of the Company, if the sale or other disposition does not violate the “Asset Sales” provisions of the indenture and the Guarantor Subsidiary ceases to be a subsidiary of the Company as a result of such sales or disposition;

(3) if such Guarantor Subsidiary is a Restricted Subsidiary and the Company designates such Guarantor Subsidiary as an Unrestricted Subsidiary in accordance with the applicable provisions of the indenture;

(4) upon Legal Defeasance or Covenant Defeasance (as such terms are defined in the indenture) or upon satisfaction and discharge of the indenture;

(5) upon the liquidation or dissolution of such Guarantor Subsidiary, provided no event of default has occurred and is continuing; or

(6) at such time as such Guarantor Subsidiary is no longer required to be a Guarantor Subsidiary of the 8.50% Senior Notes as described in the indenture, provided no event of default has occurred and is continuing.

The following condensed consolidating financial information presents the financial condition, results of operations and cash flows of the Parent Company and the Guarantor Subsidiaries, together with consolidating adjustments necessary to present the Company’s results on a consolidated basis.  Transfers of property, including related ARO, were made from the Parent Company to the Guarantor Subsidiaries to assist the Parent Company to continue to qualify for a waiver of certain supplemental bonding requirements from the BOEM.  See Note 11 for additional information.  As these transfers were transactions between entities under common control, the prior period financial information has been retrospectively adjusted for comparability purposes, as prescribed under authoritative guidance.  These adjustments had no impact on the consolidated results for the current or prior periods presented.

 

 

 

Condensed Consolidating Balance Sheet as of June 30, 2014

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consolidated

 

 

Parent

 

 

Guarantor

 

 

 

 

 

 

W&T

 

 

Company

 

 

Subsidiaries

 

 

Eliminations

 

 

Offshore, Inc.

 

 

(In thousands)

 

Assets

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

$

23,847

 

 

$

 

 

$

 

 

$

23,847

 

Receivables:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Oil and natural gas sales

 

53,737

 

 

 

40,680

 

 

 

 

 

 

94,417

 

Joint interest and other

 

26,584

 

 

 

 

 

 

 

 

 

26,584

 

Income tax

 

144,976

 

 

 

 

 

 

(144,856

)

 

 

120

 

Total receivables

 

225,297

 

 

 

40,680

 

 

 

(144,856

)

 

 

121,121

 

Prepaid expenses and other assets

 

34,462

 

 

 

4,182

 

 

 

 

 

 

38,644

 

Total current assets

 

283,606

 

 

 

44,862

 

 

 

(144,856

)

 

 

183,612

 

Property and equipment – at cost:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Oil and natural gas properties and equipment

 

5,817,544

 

 

 

1,810,664

 

 

 

 

 

 

7,628,208

 

Furniture, fixtures and other

 

21,660

 

 

 

 

 

 

 

 

 

21,660

 

Total property and equipment

 

5,839,204

 

 

 

1,810,664

 

 

 

 

 

 

7,649,868

 

Less accumulated depreciation, depletion and

   amortization

 

4,295,168

 

 

 

1,030,906

 

 

 

 

 

 

5,326,074

 

Net property and equipment

 

1,544,036

 

 

 

779,758

 

 

 

 

 

 

2,323,794

 

Restricted deposits for asset retirement obligations

 

23,723

 

 

 

 

 

 

 

 

 

23,723

 

Other assets

 

1,160,693

 

 

 

566,950

 

 

 

(1,709,000

)

 

 

18,643

 

Total assets

$

3,012,058

 

 

$

1,391,570

 

 

$

(1,853,856

)

 

$

2,549,772

 

Liabilities and Shareholders’ Equity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Accounts payable

$

134,748

 

 

$

5,747

 

 

$

 

 

$

140,495

 

Undistributed oil and natural gas proceeds

 

38,591

 

 

 

611

 

 

 

 

 

 

39,202

 

Asset retirement obligations

 

61,509

 

 

 

8,414

 

 

 

 

 

 

69,923

 

Accrued liabilities

 

59,800

 

 

 

116,355

 

 

 

(144,856

)

 

 

31,299

 

Total current liabilities

 

294,648

 

 

 

131,127

 

 

 

(144,856

)

 

 

280,919

 

Long-term debt, less current maturities

 

1,224,262

 

 

 

 

 

 

 

 

 

1,224,262

 

Asset retirement obligations, less current portion

 

172,999

 

 

 

114,681

 

 

 

 

 

 

287,680

 

Deferred income taxes

 

106,175

 

 

 

83,727

 

 

 

 

 

 

189,902

 

Other liabilities

 

660,588

 

 

 

 

 

 

(646,966

)

 

 

13,622

 

Shareholders’ equity:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common stock

 

1

 

 

 

 

 

 

 

 

 

1

 

Additional paid-in capital

 

410,641

 

 

 

842,802

 

 

 

(842,801

)

 

 

410,642

 

Retained earnings

 

166,911

 

 

 

219,233

 

 

 

(219,233

)

 

 

166,911

 

Treasury stock, at cost

 

(24,167

)

 

 

 

 

 

 

 

 

(24,167

)

Total shareholders’ equity

 

553,386

 

 

 

1,062,035

 

 

 

(1,062,034

)

 

 

553,387

 

Total liabilities and shareholders’ equity

$

3,012,058

 

 

$

1,391,570

 

 

$

(1,853,856

)

 

$

2,549,772

 

 

 

 

Condensed Consolidating Balance Sheet as of December 31, 2013

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consolidated

 

 

Parent

 

 

Guarantor

 

 

 

 

 

 

W&T

 

 

Company

 

 

Subsidiaries

 

 

Eliminations

 

 

Offshore, Inc.

 

 

(In thousands)

 

Assets

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

$

15,800

 

 

$

 

 

$

 

 

$

15,800

 

Receivables:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Oil and natural gas sales

 

61,373

 

 

 

35,379

 

 

 

 

 

 

96,752

 

Joint interest and other

 

27,984

 

 

 

 

 

 

 

 

 

27,984

 

Income taxes

 

95,611

 

 

 

 

 

 

(92,491

)

 

 

3,120

 

Total receivables

 

184,968

 

 

 

35,379

 

 

 

(92,491

)

 

 

127,856

 

Prepaid expenses and other assets

 

23,674

 

 

 

6,272

 

 

 

 

 

 

29,946

 

Total current assets

 

224,442

 

 

 

41,651

 

 

 

(92,491

)

 

 

173,602

 

Property and equipment – at cost:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Oil and natural gas properties and equipment

 

5,667,389

 

 

 

1,671,708

 

 

 

 

 

 

7,339,097

 

Furniture, fixtures and other

 

21,431

 

 

 

 

 

 

 

 

 

21,431

 

Total property and equipment

 

5,688,820

 

 

 

1,671,708

 

 

 

 

 

 

7,360,528

 

Less accumulated depreciation, depletion and amortization

 

4,166,359

 

 

 

918,345

 

 

 

 

 

 

5,084,704

 

Net property and equipment

 

1,522,461

 

 

 

753,363

 

 

 

 

 

 

2,275,824

 

Restricted deposits for asset retirement obligations

 

37,421

 

 

 

 

 

 

 

 

 

37,421

 

Other assets

 

951,203

 

 

 

479,820

 

 

 

(1,410,568

)

 

 

20,455

 

Total assets

$

2,735,527

 

 

$

1,274,834

 

 

$

(1,503,059

)

 

$

2,507,302

 

Liabilities and Shareholders’ Equity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Accounts payable

$

144,492

 

 

$

720

 

 

$

 

 

$

145,212

 

Undistributed oil and natural gas proceeds

 

41,735

 

 

 

372

 

 

 

 

 

 

42,107

 

Asset retirement obligations

 

65,329

 

 

 

12,456

 

 

 

 

 

 

77,785

 

Accrued liabilities

 

28,000

 

 

 

92,491

 

 

 

(92,491

)

 

 

28,000

 

Total current liabilities

 

279,556

 

 

 

106,039

 

 

 

(92,491

)

 

 

293,104

 

Long-term debt, less current maturities

 

1,205,421

 

 

 

 

 

 

 

 

 

1,205,421

 

Asset retirement obligations, less current portion

 

189,507

 

 

 

87,130

 

 

 

 

 

 

276,637

 

Deferred income taxes

 

79,424

 

 

 

98,718

 

 

 

 

 

 

178,142

 

Other liabilities

 

441,009

 

 

 

 

 

 

(427,621

)

 

 

13,388

 

Shareholders’ equity:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common stock

 

1

 

 

 

 

 

 

 

 

 

1

 

Additional paid-in capital

 

403,564

 

 

 

784,104

 

 

 

(784,104

)

 

 

403,564

 

Retained earnings

 

161,212

 

 

 

198,843

 

 

 

(198,843

)

 

 

161,212

 

Treasury stock, at cost

 

(24,167

)

 

 

 

 

 

 

 

 

(24,167

)

Total shareholders’ equity

 

540,610

 

 

 

982,947

 

 

 

(982,947

)

 

 

540,610

 

Total liabilities and shareholders’ equity

$

2,735,527

 

 

$

1,274,834

 

 

$

(1,503,059

)

 

$

2,507,302

 

 

 

 

 

 

Condensed Consolidating Statement of Income for the Three Months Ended June 30, 2014

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consolidated

 

 

Parent

 

 

Guarantor

 

 

 

 

 

 

W&T

 

 

Company

 

 

Subsidiaries

 

 

Eliminations

 

 

Offshore, Inc.

 

 

(In thousands)

 

Revenues

$

162,071

 

 

$

100,923

 

 

$

 

 

$

262,994

 

Operating costs and expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Lease operating expenses

 

40,612

 

 

 

21,153

 

 

 

 

 

 

61,765

 

Production taxes

 

1,842

 

 

 

 

 

 

 

 

 

1,842

 

Gathering and transportation

 

2,218

 

 

 

1,767

 

 

 

 

 

 

3,985

 

Depreciation, depletion, amortization and accretion

 

71,327

 

 

 

56,909

 

 

 

 

 

 

128,236

 

General and administrative expenses

 

10,638

 

 

 

9,044

 

 

 

 

 

 

19,682

 

Derivative loss

 

13,079

 

 

 

 

 

 

 

 

 

13,079

 

Total costs and expenses

 

139,716

 

 

 

88,873

 

 

 

 

 

 

228,589

 

Operating income

 

22,355

 

 

 

12,050

 

 

 

 

 

 

34,405

 

Earnings of affiliates

 

7,939

 

 

 

 

 

 

(7,939

)

 

 

 

Interest expense:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Incurred

 

20,617

 

 

 

837

 

 

 

 

 

 

21,454

 

Capitalized

 

(1,322

)

 

 

(837

)

 

 

 

 

 

(2,159

)

Income before income tax expense

 

10,999

 

 

 

12,050

 

 

 

(7,939

)

 

 

15,110

 

Income tax expense  (benefit)

 

1,162

 

 

 

4,111

 

 

 

 

 

 

5,273

 

Net income

$

9,837

 

 

$

7,939

 

 

$

(7,939

)

 

$

9,837

 

 

Condensed Consolidating Statement of Income for the Six Months Ended June 30, 2014

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consolidated

 

 

Parent

 

 

Guarantor

 

 

 

 

 

 

W&T

 

 

Company

 

 

Subsidiaries

 

 

Eliminations

 

 

Offshore, Inc.

 

 

(In thousands)

 

Revenues

$

306,057

 

 

$

211,453

 

 

$

 

 

$

517,510

 

Operating costs and expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Lease operating expenses

 

79,724

 

 

 

37,660

 

 

 

 

 

 

117,384

 

Production taxes

 

3,834

 

 

 

 

 

 

 

 

 

3,834

 

Gathering and transportation

 

5,556

 

 

 

3,725

 

 

 

 

 

 

9,281

 

Depreciation, depletion, amortization and accretion

 

133,758

 

 

 

117,784

 

 

 

 

 

 

251,542

 

General and administrative expenses

 

22,083

 

 

 

21,187

 

 

 

 

 

 

43,270

 

Derivative loss

 

20,571

 

 

 

 

 

 

 

 

 

20,571

 

Total costs and expenses

 

265,526

 

 

 

180,356

 

 

 

 

 

 

445,882

 

Operating income

 

40,531

 

 

 

31,097

 

 

 

 

 

 

71,628

 

Earnings of affiliates

 

20,390

 

 

 

 

 

 

(20,390

)

 

 

 

Interest expense:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Incurred

 

41,294

 

 

 

1,618

 

 

 

 

 

 

42,912

 

Capitalized

 

(2,613

)

 

 

(1,618

)

 

 

 

 

 

(4,231

)

Income before income tax expense

 

22,240

 

 

 

31,097

 

 

 

(20,390

)

 

 

32,947

 

Income tax expense  (benefit)

 

1,214

 

 

 

10,707

 

 

 

 

 

 

11,921

 

Net income

$

21,026

 

 

$

20,390

 

 

$

(20,390

)

 

$

21,026

 

 

 

 

 

 

Condensed Consolidating Statement of Income for the Three Months Ended June 30, 2013

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consolidated

 

 

Parent

 

 

Guarantor

 

 

 

 

 

 

W&T

 

 

Company

 

 

Subsidiaries

 

 

Eliminations

 

 

Offshore, Inc.

 

 

(In thousands)

 

Revenues

$

147,070

 

 

$

88,313

 

 

$

 

 

$

235,383

 

Operating costs and expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Lease operating expenses

 

51,406

 

 

 

16,842

 

 

 

 

 

 

68,248

 

Production taxes

 

1,780

 

 

 

 

 

 

 

 

 

1,780

 

Gathering and transportation

 

2,833

 

 

 

1,775

 

 

 

 

 

 

4,608

 

Depreciation, depletion, amortization and accretion

 

55,706

 

 

 

44,190

 

 

 

 

 

 

99,896

 

General and administrative expenses

 

11,473

 

 

 

8,395

 

 

 

 

 

 

19,868

 

Derivative loss

 

(12,840

)

 

 

 

 

 

 

 

 

(12,840

)

Total costs and expenses

 

110,358

 

 

 

71,202

 

 

 

 

 

 

181,560

 

Operating income

 

36,712

 

 

 

17,111

 

 

 

 

 

 

53,823

 

Earnings of affiliates

 

11,143

 

 

 

 

 

 

(11,143

)

 

 

 

Interest expense:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Incurred

 

20,789

 

 

 

747

 

 

 

 

 

 

21,536

 

Capitalized

 

(1,785

)

 

 

(747

)

 

 

 

 

 

(2,532

)

Income before income tax expense

 

28,851

 

 

 

17,111

 

 

 

(11,143

)

 

 

34,819

 

Income tax expense

 

6,455

 

 

 

5,968

 

 

 

 

 

 

12,423

 

Net income

$

22,396

 

 

$

11,143

 

 

$

(11,143

)

 

$

22,396

 

 

Condensed Consolidating Statement of Income for the Six Months Ended June 30, 2013

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consolidated

 

 

Parent

 

 

Guarantor

 

 

 

 

 

 

W&T

 

 

Company

 

 

Subsidiaries

 

 

Eliminations

 

 

Offshore, Inc.

 

 

(In thousands)

 

Revenues

$

317,611

 

 

$

176,994

 

 

$

 

 

$

494,605

 

Operating costs and expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Lease operating expenses

 

94,676

 

 

 

32,914

 

 

 

 

 

 

127,590

 

Production taxes

 

3,569

 

 

 

 

 

 

 

 

 

3,569

 

Gathering and transportation

 

5,112

 

 

 

3,940

 

 

 

 

 

 

9,052

 

Depreciation, depletion, amortization and accretion

 

118,908

 

 

 

89,859

 

 

 

 

 

 

208,767

 

General and administrative expenses

 

23,885

 

 

 

17,070

 

 

 

 

 

 

40,955

 

Derivative loss

 

(9,473

)

 

 

 

 

 

 

 

 

(9,473

)

Total costs and expenses

 

236,677

 

 

 

143,783

 

 

 

 

 

 

380,460

 

Operating income

 

80,934

 

 

 

33,211

 

 

 

 

 

 

114,145

 

Earnings of affiliates

 

21,641

 

 

 

 

 

 

(21,641

)

 

 

 

Interest expense:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Incurred

 

41,307

 

 

 

1,463

 

 

 

 

 

 

42,770

 

Capitalized

 

(3,501

)

 

 

(1,463

)

 

 

 

 

 

(4,964

)

Income before income tax expense

 

64,769

 

 

 

33,211

 

 

 

(21,641

)

 

 

76,339

 

Income tax expense

 

15,755

 

 

 

11,570

 

 

 

 

 

 

27,325

 

Net income

$

49,014

 

 

$

21,641

 

 

$

(21,641

)

 

$

49,014

 

 

 

 

 

Condensed Consolidating Statement of Cash Flows for the Six Months Ended June 30, 2014

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consolidated

 

 

Parent

 

 

Guarantor

 

 

 

 

 

 

W&T

 

 

Company

 

 

Subsidiaries

 

 

Eliminations

 

 

Offshore, Inc.

 

 

(In thousands)

 

Operating activities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

$

21,026

 

 

$

20,390

 

 

$

(20,390

)

 

$

21,026

 

Adjustments to reconcile net income to net cash

   provided by operating activities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation, depletion, amortization and accretion

 

133,758

 

 

 

117,784

 

 

 

 

 

 

251,542

 

Amortization of debt issuance costs and premium

 

366

 

 

 

 

 

 

 

 

 

366

 

Share-based compensation

 

7,644

 

 

 

 

 

 

 

 

 

7,644

 

Derivative loss

 

20,571

 

 

 

 

 

 

 

 

 

20,571

 

Cash payments on derivative settlements (realized)

 

(14,310

)

 

 

 

 

 

 

 

 

(14,310

)

Deferred income taxes

 

25,078

 

 

 

(13,157

)

 

 

 

 

 

11,921

 

Earnings of affiliates

 

(20,390

)

 

 

 

 

 

20,390

 

 

 

 

Changes in operating assets and liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Oil and natural gas receivables

 

7,636

 

 

 

(5,301

)

 

 

 

 

 

2,335

 

Joint interest and other receivables

 

3,550

 

 

 

 

 

 

 

 

 

3,550

 

Income taxes

 

(20,947

)

 

 

23,865

 

 

 

 

 

 

2,918

 

Prepaid expenses and other assets

 

(127,910

)

 

 

(86,875

)

 

 

219,224

 

 

 

4,439

 

Asset retirement obligations settlements

 

(18,583

)

 

 

(11,755

)

 

 

 

 

 

(30,338

)

Accounts payable, accrued liabilities  and other

 

203,344

 

 

 

5,266

 

 

 

(219,224

)

 

 

(10,614

)

Net cash provided by operating activities

 

220,833

 

 

 

50,217

 

 

 

 

 

 

271,050

 

Investing activities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Acquisition of property interest in oil and natural gas properties

 

 

 

 

(53,363

)

 

 

 

 

 

(53,363

)

Investment in oil and natural gas properties and equipment

 

(157,128

)

 

 

(55,552

)

 

 

 

 

 

(212,680

)

Investment in subsidiary

 

(58,698

)

 

 

 

 

 

58,698

 

 

 

 

Purchases of furniture, fixtures and other

 

(1,715

)

 

 

 

 

 

 

 

 

(1,715

)

Net cash used in investing activities

 

(217,541

)

 

 

(108,915

)

 

 

58,698

 

 

 

(267,758

)

Financing activities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Borrowings of long-term debt – revolving bank credit facility

 

220,000

 

 

 

 

 

 

 

 

 

220,000

 

Repayments of long-term debt – revolving bank credit

   facility

 

(200,000

)

 

 

 

 

 

 

 

 

(200,000

)

Dividends to shareholders

 

(15,129

)

 

 

 

 

 

 

 

 

(15,129

)

Other

 

(116

)

 

 

 

 

 

 

 

 

(116

)

Investment from parent

 

 

 

 

58,698

 

 

 

(58,698

)

 

 

 

Net cash provided (used) in financing activities

 

4,755

 

 

 

58,698

 

 

 

(58,698

)

 

 

4,755

 

Increase in cash and cash equivalents

 

8,047

 

 

 

 

 

 

 

 

 

8,047

 

Cash and cash equivalents, beginning of period

 

15,800

 

 

 

 

 

 

 

 

 

15,800

 

Cash and cash equivalents, end of period

$

23,847

 

 

$

 

 

$

 

 

$

23,847

 

 

 

 

 

Condensed Consolidating Statement of Cash Flows for the Six Months Ended June 30, 2013

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consolidated

 

 

Parent

 

 

Guarantor

 

 

 

 

 

 

W&T

 

 

Company

 

 

Subsidiaries

 

 

Eliminations

 

 

Offshore, Inc.

 

 

(In thousands)

 

Operating activities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

$

49,014

 

 

$

21,641

 

 

$

(21,641

)

 

$

49,014

 

Adjustments to reconcile net income to net cash

   provided by operating activities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation, depletion, amortization and accretion

 

118,908

 

 

 

89,859

 

 

 

 

 

 

208,767

 

Amortization of debt issuance costs and premium

 

910

 

 

 

 

 

 

 

 

 

910

 

Share-based compensation

 

4,950

 

 

 

 

 

 

 

 

 

4,950

 

Derivative gain

 

(9,473

)

 

 

 

 

 

 

 

 

(9,473

)

Cash payments on derivative settlements

 

(2,310

)

 

 

 

 

 

 

 

 

(2,310

)

Deferred income taxes

 

11,357

 

 

 

12,369

 

 

 

 

 

 

23,726

 

Earnings of affiliates

 

(21,641

)

 

 

 

 

 

21,641

 

 

 

 

Changes in operating assets and liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Oil and natural gas receivables

 

15,673

 

 

 

1,390

 

 

 

 

 

 

17,063

 

Joint interest and other receivables

 

38,635

 

 

 

 

 

 

 

 

 

38,635

 

Income taxes

 

9,378

 

 

 

(799

)

 

 

 

 

 

8,579

 

Prepaid expenses and other assets

 

(26,487

)

 

 

(27,054

)

 

 

41,160

 

 

 

(12,381

)

Asset retirement obligations

 

(29,740

)

 

 

(3,146

)

 

 

 

 

 

(32,886

)

Accounts payable, accrued liabilities  and other

 

44,054

 

 

 

(126

)

 

 

(41,160

)

 

 

2,768

 

Net cash provided by operating activities

 

203,228

 

 

 

94,134

 

 

 

 

 

 

297,362

 

Investing activities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Investment in oil and natural gas properties and equipment

 

(205,079

)

 

 

(94,134

)

 

 

 

 

 

(299,213

)

Purchases of furniture, fixtures and other

 

(981

)

 

 

 

 

 

 

 

 

(981

)

Net cash used in investing activities

 

(206,060

)

 

 

(94,134

)

 

 

 

 

 

(300,194

)

Financing activities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Borrowings of long-term debt – revolving bank credit facility

 

252,000

 

 

 

 

 

 

 

 

 

252,000

 

Repayments of long-term debt – revolving bank credit facility

 

(239,000

)

 

 

 

 

 

 

 

 

(239,000

)

Dividends to shareholders

 

(12,795

)

 

 

 

 

 

 

 

 

(12,795

)

Other

 

(342

)

 

 

 

 

 

 

 

 

(342

)

Net cash used in financing activities

 

(137

)

 

 

 

 

 

 

 

 

(137

)

Increase in cash and cash equivalents

 

(2,969

)

 

 

 

 

 

 

 

 

(2,969

)

Cash and cash equivalents, beginning of period

 

12,245

 

 

 

 

 

 

 

 

 

12,245

 

Cash and cash equivalents, end of period

$

9,276

 

 

$

 

 

$

 

 

$

9,276