Quarterly report pursuant to Section 13 or 15(d)

SUBSIDIARY BORROWERS

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SUBSIDIARY BORROWERS
9 Months Ended
Sep. 30, 2023
SUBSIDIARY BORROWERS  
SUBSIDIARY BORROWERS

NOTE 6 — SUBSIDIARY BORROWERS

The Subsidiary Borrowers used the net proceeds from the Term Loan (see Note 2 – Debt) to acquire all of the Company’s interests in certain oil and gas leasehold interests and associated wells and units located in State of Alabama waters and U.S. federal waters in the offshore Gulf of Mexico, Mobile Bay region (such assets, the “Mobile Bay Properties”) and the Company’s interest in certain gathering and processing assets located offshore Gulf of Mexico, Mobile Bay region and onshore near Mobile, Alabama, including offshore gathering pipelines, an onshore crude oil treating and sweetening facility, an onshore gathering pipeline, and associated assets (such assets, the “Midstream Assets”).

The Subsidiary Borrowers are wholly-owned subsidiaries of the Company; however, the assets of the Subsidiary Borrowers are not available to satisfy the debt or contractual obligations of any other entities, including debt securities or other contractual obligations of the Company, and the Subsidiary Borrowers do not bear any liability for the indebtedness or other contractual obligations of any other entities, and vice versa.

During the year ended December 31, 2022, the Subsidiary Borrowers paid cash distributions to W&T of $30.2 million. During the nine months ended September 30, 2023, no such distributions were paid.

Consolidation and Carrying Amounts

The following table presents the amounts recorded by the Company on the Condensed Consolidated Balance Sheets related to the consolidation of the Subsidiary Borrowers and the Subsidiary Parent (in thousands):

September 30, 

December 31, 

2023

2022

Assets:

 

  

 

  

Cash and cash equivalents

$

1,408

$

21,764

Receivables:

 

  

 

  

Oil and natural gas sales

 

22,988

 

37,344

Joint interest, net

 

(25,446)

 

(5,760)

Prepaid expenses and other assets

 

(55)

 

417

Oil and natural gas properties and other, net

 

290,686

 

280,649

Other assets

 

9,328

 

8,473

Liabilities:

 

  

 

  

Accounts payable

10,432

27,387

Undistributed oil and natural gas proceeds

 

4,480

 

7,930

Accrued liabilities

 

17,982

 

45,102

Current portion of long-term debt, net

29,451

32,119

Long-term debt, net

 

88,783

 

111,188

Asset retirement obligations

 

67,402

 

61,138

Other liabilities

 

16,531

 

47,398

The following table presents the amounts recorded by the Company in the Condensed Consolidated Statement of Operations related to the consolidation of the operations of the Subsidiary Borrowers and the Subsidiary Parent (in thousands):

Three Months Ended September 30, 

Nine Months Ended September 30, 

2023

2022

2023

2022

Total revenues

$

28,865

$

94,264

$

75,425

$

218,625

Total operating expenses

 

18,807

 

19,776

 

69,297

 

52,961

Interest expense, net

 

2,536

 

3,405

 

7,947

 

11,841

Derivative (gain) loss

 

(2,652)

 

55,850

 

(55,041)

 

187,896