0001655020-21-000118 | 10-K | XBRL Viewer

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Document and Entity Information - USD ($) $ in Millions	12 Months Ended
Document and Entity Information - USD ($) $ in Millions	Dec. 31, 2020	Mar. 15, 2021	Jun. 30, 2020
Cover [Abstract]
Document Type	10-K
Document Annual Report	true
Document Period End Date	Dec. 31, 2020
Current Fiscal Year End Date	--12-31
Document Transition Report	false
Entity File Number	001-37907
Entity Registrant Name	EXTRACTION OIL & GAS, INC.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	46-1473923
Entity Address, Address Line One	370 17th Street,
Entity Address, Address Line Two	Suite 5200
Entity Address, City or Town	Denver
Entity Address, State or Province	CO
Entity Address, Postal Zip Code	80202
City Area Code	(720)
Local Phone Number	557-8300
Title of 12(b) Security	Common Stock, par value $0.01
Trading Symbol	XOG
Security Exchange Name	NASDAQ
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Public Float			$ 9.7
Entity Common Stock, Shares Outstanding		25,697,136
Documents Incorporated by Reference [Text Block]	Items 10, 11, 12, 13 and 14 of Part III will be incorporated by reference from the Form 10-K/A to be filed with the Securities and Exchange Commission.
Entity Central Index Key	0001655020
Document Fiscal Year Focus	2020
Document Fiscal Period Focus	FY
Amendment Flag	false
ICFR Auditor Attestation Flag	false
Entity Bankruptcy Proceedings, Reporting Current	true

CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Dec. 31, 2020	Dec. 31, 2019
Current Assets:
Cash and cash equivalents	$ 205,890	$ 32,382
Accounts receivable, net
Trade	13,266	32,009
Oil, natural gas and NGL sales	63,429	105,103
Inventory, prepaid expenses and other	36,382	36,702
Commodity derivative asset	6,971	17,554
Total Current Assets	325,938	223,750
Property and Equipment (successful efforts method), at cost:
Proved oil and gas properties	4,743,463	4,530,934
Unproved oil and gas properties	220,380	524,214
Wells in progress	129,058	149,733
Less: accumulated depletion, depreciation, amortization and impairment charges	(3,459,689)	(2,985,983)
Net oil and gas properties	1,633,212	2,218,898
Gathering systems and facilities, net of accumulated depreciation—Note 2	0	315,777
Other property and equipment, net of accumulated depreciation and impairment charges—Note 2	56,701	72,542
Net Property and Equipment	1,689,913	2,607,217
Non-Current Assets:
Commodity derivative asset	0	13,229
Other non-current assets	9,348	82,761
Total Non-Current Assets	9,348	95,990
Total Assets	2,025,199	2,926,957
Current Liabilities:
Accounts payable and accrued liabilities	80,082	190,864
Revenue payable	49,376	108,493
Production taxes payable	2,595	115,489
Commodity derivative liability	2,147	1,998
Accrued interest payable	692	20,625
Asset retirement obligations	0	27,058
Debtor In Possession Financing, Line of Credit	106,727	0
Line of Credit, Current	453,747	0
Total Current Liabilities	695,366	464,527
Non-Current Liabilities:
Prior Credit Facility—Note 8	0	470,000
Senior Notes, net of unamortized debt issuance costs—Note 8	0	1,085,777
Production taxes payable	33,627	98,740
Commodity derivative liability	0	108
Other non-current liabilities	0	54,579
Asset retirement obligations	0	68,850
Total Non-Current Liabilities	33,627	1,778,054
Liabilities Subject to Compromise	2,143,497	0
Total Liabilities	2,872,490	2,242,581
Series A Convertible Preferred Stock, $0.01 par value; 50,000,000 shares authorized; 185,280 issued and outstanding	191,754	175,639
Stockholders’ Equity (Deficit):
Common stock, $0.01 par value; 900,000,000 shares authorized; 136,588,900 and 137,657,922 issued and outstanding, respectively	1,336	1,336
Treasury stock, at cost, 38,859,078 shares	(170,138)	(170,138)
Additional paid-in capital	2,140,499	2,156,383
Accumulated deficit	(3,010,742)	(1,743,208)
Total Extraction Oil & Gas, Inc. Stockholders’ Equity (Deficit)	(1,039,045)	244,373
Noncontrolling interest—Note 12	0	264,364
Total Stockholders’ Equity (Deficit)	(1,039,045)	508,737
Total Liabilities and Stockholders’ Equity	$ 2,025,199	$ 2,926,957

CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Total Revenues	$ 557,904	$ 906,635	$ 1,060,743
Operating Expenses:
Lease operating expenses	77,836	97,254	79,413
Production taxes	29,038	68,182	90,345
Exploration and abandonment expenses	258,932	88,794	31,611
Depletion, depreciation, amortization and accretion	332,319	524,537	435,775
Impairment of long lived assets and goodwill	208,463	1,337,996	70,928
(Gain) loss on sale of property and equipment and assets of unconsolidated subsidiary	(122)	421	(136,834)
General and administrative expenses	55,182	98,845	134,604
Other Cost and Expense, Operating	79,615	0	0
Total Operating Expenses	1,183,750	2,271,427	745,253
Operating Income (Loss)	(625,846)	(1,364,792)	315,490
Other Income (Expense):
Commodity derivatives gain (loss)	164,968	(37,107)	(8,554)
Deconsolidation, Gain (Loss), Amount	(73,139)	0	0
Reorganization Items	(676,855)	0	0
Interest expense (1)	(57,143)	(79,232)	(123,330)
Other income	481	4,535	5,099
Total Other Expense	(641,688)	(111,804)	(126,785)
Income (Loss) Before Income Taxes	(1,267,534)	(1,476,596)	188,705
Income tax (expense) benefit	0	109,176	(66,850)
Income (Loss), Including Portion Attributable to Noncontrolling Interest, before Tax	(1,267,534)	(1,367,420)	121,855
Net Income (Loss) Attributable to Noncontrolling Interest	6,160	19,992	7,287
Net Income (Loss) Attributable to Parent, Total	(1,273,694)	(1,387,412)	114,568
Preferred Stock Dividends and Other Adjustments	16,115	19,436	16,869
Net income (loss) available to common shareholders, basic and diluted	$ (1,289,809)	$ (1,406,848)	$ 97,699
Net Income (Loss) Per Common Share—Note 15
Basic and diluted (in dollars per share)	$ (9.34)	$ (9.29)	$ 0.56
Weighted Average Common Shares Outstanding
Basic and diluted (in shares)	138,149	151,481	174,748
Oil sales
Total Revenues	$ 382,526	$ 721,429	$ 840,687
Natural gas sales
Total Revenues	96,701	108,873	105,629
NGL sales
Total Revenues	77,204	75,072	114,427
Transporting And Gathering [Member]
Total Revenues	30,515	38,453	35,682
Operating Expenses:
Cost of Goods and Services Sold	138,552	53,140	39,411
Mindstream Operating Expenses [Member]
Operating Expenses:
Cost of Goods and Services Sold	3,935	2,258	0
Gathering and Compression [Member]
Total Revenues	$ 1,473	$ 1,261	$ 0

CONSOLIDATED STATEMENTS OF OPERATIONS (Parenthetical) $ in Millions	12 Months Ended
	Dec. 31, 2020 USD ($)
Income Statement [Abstract]
Interest Expense, Debt, Absent of Automatic Stay	$ 94.5

CONSOLIDATED STATEMENTS OF CHANGES IN MEMBERS' AND STOCKHOLDERS' EQUITY - USD ($) shares in Thousands, $ in Thousands	Total	Common Stock	Treasury Stock	Additional Paid in Capital	Retained Earnings (Deficit)	Parent [Member]	Noncontrolling Interest [Member]
Balance at beginning of period (in units or shares) at Dec. 31, 2017		172,060	165
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest, Beginning Balance at Dec. 31, 2017	$ 1,616,765	$ 1,718	$ (2,105)	$ 2,114,795	$ (497,643)	$ 1,616,765	$ 0
CHANGES IN MEMBERS’ AND STOCKHOLDERS’ EQUITY
Preferred Stock, Value, Issued, Issuance Costs	(7,915)						(7,915)
Adjustments To Additional Paid in Capital, Preferred Stock, Commitment Fees and Dividends Paid-in-Kind	0			(7,287)		7,287	7,287
Stock Issued During Period, Shares, Share-based Compensation, Net of Forfeitures		2,794
Shares Granted, Value, Share-based Payment Arrangement, after Forfeiture	(68,349)			68,349		(68,349)
Dividends, Preferred Stock, Paid	(10,885)			(10,885)		(10,885)
Preferred Stock, Accretion of Redemption Discount	(5,984)			(5,984)		(5,984)
Income (Loss), Including Portion Attributable to Noncontrolling Interest, before Tax	121,855				121,855	121,855
Repurchase of common stock (in shares)			4,378
Treasury Stock, Value, Acquired, Cost Method	(30,672)	$ (40)	$ (30,632)			(30,672)
Shares issued under LTIP, including payment of tax withholdings using withheld shares (in shares)		1,356
APIC, Share-based Payment Arrangement, Other, Increase for Cost Recognition	(5,327)			(5,327)		(5,327)
Balance at end of period (in units or shares) at Dec. 31, 2018		176,210	4,543
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest, Ending Balance at Dec. 31, 2018	1,894,686	$ 1,678	$ (32,737)	2,153,661	(375,788)	1,746,814	147,872
CHANGES IN MEMBERS’ AND STOCKHOLDERS’ EQUITY
Preferred Stock, Value, Issued	148,500						148,500
Preferred Stock, Value, Issued, Issuance Costs	(2,500)						(2,500)
Adjustments To Additional Paid in Capital, Preferred Stock, Commitment Fees and Dividends Paid-in-Kind	0			(19,992)		(19,992)	19,992
Shares Granted, Value, Share-based Payment Arrangement, after Forfeiture	44,001			44,001		44,001
Dividends, Preferred Stock, Paid	(12,796)			(12,796)		(12,796)
Preferred Stock, Accretion of Redemption Discount	(6,640)			(6,640)		(6,640)
Income (Loss), Including Portion Attributable to Noncontrolling Interest, before Tax	(1,367,420)				(1,367,420)	(1,367,420)
Repurchase of common stock (in shares)			34,316
Treasury Stock, Value, Acquired, Cost Method	(137,743)	$ (342)	$ (137,401)			(137,743)
Shares issued under LTIP, including payment of tax withholdings using withheld shares (in shares)		307
APIC, Share-based Payment Arrangement, Other, Increase for Cost Recognition	(1,851)			(1,851)		(1,851)
Balance at end of period (in units or shares) at Dec. 31, 2019		176,517	38,859
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest, Ending Balance at Dec. 31, 2019	508,737	$ 1,336	$ (170,138)	2,156,383	(1,743,208)	244,373	264,364
CHANGES IN MEMBERS’ AND STOCKHOLDERS’ EQUITY
Preferred Stock, Value, Issued	99,000						99,000
Adjustments To Additional Paid in Capital, Preferred Stock, Commitment Fees and Dividends Paid-in-Kind	0			(6,160)		(6,160)	6,160
Shares Granted, Value, Share-based Payment Arrangement, after Forfeiture	6,511			6,511		6,511
Dividends, Preferred Stock, Paid	(8,749)			(8,749)		(8,749)
Preferred Stock, Accretion of Redemption Discount	(7,366)			(7,366)		(7,366)
Income (Loss), Including Portion Attributable to Noncontrolling Interest, before Tax	(1,267,534)				(1,267,534)	(1,267,534)
Shares issued under LTIP, including payment of tax withholdings using withheld shares (in shares)		714
APIC, Share-based Payment Arrangement, Other, Increase for Cost Recognition	(120)			(120)		(120)
Cancellation of Performance Stock Awards, Shares		(1,783)
Effect of Deconsolidation of An Entity							(270,524)
Balance at end of period (in units or shares) at Dec. 31, 2020		175,448	38,859
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest, Ending Balance at Dec. 31, 2020	$ (1,039,045)	$ 1,336	$ (170,138)	$ 2,140,499	$ (3,010,742)	$ (1,039,045)	$ 0

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Cash flows from operating activities:
Income (Loss), Including Portion Attributable to Noncontrolling Interest, before Tax	$ (1,267,534)	$ (1,367,420)	$ 121,855
Reconciliation of net income (loss) to net cash provided by operating activities:
Depletion, depreciation, amortization and accretion	332,319	524,537	435,775
Abandonment of unproved properties	253,142	73,729	25,704
Impairment of long lived assets and goodwill	208,463	1,337,996	70,928
(Gain) loss on sale of property and equipment	(122)	1,431	(53,222)
(Gain) loss on sale of property and equipment and assets of unconsolidated subsidiary	0	(1,010)	(83,612)
Gain (Loss) on Repurchase of Debt Instrument	0	10,486	0
Amortization of debt issuance costs and debt discount	3,685	5,482	13,250
Noncash Lease Expense	11,724	11,146	0
Noncash Reorganization Items, Net	10,636	0	0
Increase (Decrease) in Contract with Customer, Asset	12,317	24,700	0
Deferred rent	0	0	348
(Gain) loss on commodity derivatives	(164,968)	37,107	8,554
Settlements on commodity derivatives	89,800	(678)	(134,624)
Premiums paid on commodity derivatives	0	(2,852)	(22,749)
Deconsolidation, Gain (Loss), Amount	73,139	0	0
Earnings in unconsolidated subsidiaries	(480)	(2,285)	(2,862)
Distributions from unconsolidated subsidiary	0	3,200	1,684
Make-whole premium expense on 2021 Senior Notes	0	0	35,600
Deferred income tax expense (benefit)	0	(109,176)	66,850
Stock-based compensation	6,511	43,954	68,349
Changes in current assets and liabilities:
Accounts receivable—trade	16,900	3,630	8,562
Accounts receivable—oil, natural gas and NGL sales	41,674	(12,996)	2,076
Inventory, prepaid expenses and other	(17,555)	(332)	(853)
Accounts payable and accrued liabilities	87,228	(5,753)	(6,835)
Accrued Damages From Rejected And Settled Contracts	582,439	0	0
Revenue payable	(147)	(7,598)	66,276
Production taxes payable	(3,631)	40,957	79,106
Accrued interest payable	11,743	(1,624)	(1,558)
Asset retirement expenditures	(21,308)	(27,702)	(13,669)
Net Cash Provided by (Used in) Operating Activities, Total	265,975	557,957	684,933
Net Cash Provided by (Used in) Investing Activities, Continuing Operations [Abstract]
Oil and gas property additions	(249,984)	(635,853)	(958,399)
Sale of property and equipment	14,420	56,305	80,879
Gathering systems and facilities additions, net of cost reimbursements	4,193	(202,513)	(81,406)
Other property and equipment additions	(3,697)	(39,090)	(15,991)
Investment in unconsolidated subsidiaries	(10,033)	(30,012)	(6,000)
Sale of assets of unconsolidated subsidiary	0	1,010	83,612
Net cash used in investing activities	(245,101)	(850,153)	(897,305)
Cash flows from financing activities:
Borrowings under Prior Credit Facility	200,500	465,000	635,000
Repayments under Prior Credit Facility	(70,000)	(280,000)	(440,000)
Proceeds From Borrowings Under Debtor In Possession Financing	35,000	0	0
Repayments of Borrowings Under Debtor In Possession Financing	(3,273)	0	0
Proceeds from the issuance of Senior Notes	0	0	739,664
Repayments of 2021 Senior Notes	0	0	(550,000)
Make-whole premium paid on 2021 Senior Notes	0	0	(35,600)
Payment for Repurchase of Senior Notes	0	39,325	0
Repurchase of common stock	0	(137,743)	(30,672)
Payment, Tax Withholding, Share-based Payment Arrangement	(120)	(1,851)	(5,327)
Dividends on Series A Preferred Stock	0	(10,885)	(10,885)
Proceeds from issuance of Preferred Units	0	99,000	148,500
Preferred Unit issuance costs	0	(2,500)	(6,915)
Net Cash Provided by (Used in) Financing Activities, Total	160,362	89,592	440,590
Effect of Deconsolidation Of A Subsidiary	(7,728)	0	0
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents, Period Increase (Decrease), Excluding Exchange Rate Effect, Total	173,508	(202,604)	228,218
Cash, cash equivalents and restricted cash at beginning of period	32,382	234,986	6,768
Cash, cash equivalents and restricted cash at end of the period	205,890	32,382	234,986
Supplemental Cash Flow Information [Abstract]
Property and equipment included in accounts payable and accrued liabilities	14,878	118,152	141,952
Interest Paid, Excluding Capitalized Interest, Operating Activities	47,032	93,084	84,224
Cash Paid For Reorganization	34,356	0	0
Series A Preferred Stock Dividends	8,749	4,632	0
Accretion of beneficial conversion feature of Series A Preferred Stock	7,366	6,640	5,984
Preferred Units commitment fees and dividends paid-in-kind	6,160	19,992	7,287
Reduction in Credit Facility From Derivative Unwinding	96,065	0	0
Increase in Credit Facility From Draws	24,311	0	0
Issuance Of Notes To Unconsolidated Subsidiaries	0	0	35,329
Noncash Or Part Noncash Transaction, Extinguishment Of Note For Equity Interest	0	0	(35,329)
Series A Preferred Stock
Cash flows from financing activities:
Dividends on preferred stock/units	$ (1,745)	$ (2,104)	$ (3,175)

Business and Organization	12 Months Ended
Business and Organization	Dec. 31, 2020
Limited Liability Company or Limited Partnership, Business Organization and Operations [Abstract]
Business and Organization	Business and Organization Extraction Oil & Gas, Inc. (the “Company” or “Extraction”) is an independent oil and gas company focused on the acquisition, development and production of oil, natural gas and natural gas liquids (“NGLs”) reserves in the Rocky Mountain region, primarily in the Wattenberg Field of the Denver-Julesburg Basin (the “DJ Basin”) of Colorado. As described in the section below titled Voluntary Reorganization under Chapter 11 of the Bankruptcy Code, during the second quarter of 2020, the Company filed for bankruptcy and, as a result, was delisted from the NASDAQ Global Select Market on June 25, 2020 and began trading on the Pink Open Market under the symbol “XOGAQ.” As described in the section below titled Emergence from Chapter 11 Bankruptcy, on January 20, 2021 the Company emerged from bankruptcy as a reorganized entity and, as a result, was relisted on the NASDAQ Global Select Market on January 21, 2021 and began trading under the symbol “XOG.” To facilitate our financial statement presentations, the Company refers to the post-emergence reorganized company in these consolidated financial statements and footnotes as the Successor Company for periods subsequent to January 20, 2021 and to the pre-emergence company as the Predecessor Company for periods on or prior to January 20, 2021. Voluntary Reorganization under Chapter 11 of the Bankruptcy Code As previously disclosed, on June 14, 2020 (the “Petition Date”), Extraction and its wholly owned subsidiaries (collectively, the “Debtors”), filed voluntary petitions for relief under chapter 11 (“Chapter 11”) of title 11 of the United States Code (the “Bankruptcy Code”) in the United States Bankruptcy Court for the District of Delaware (the “Bankruptcy Court”). The Debtors’ Chapter 11 cases (the “Chapter 11 Cases”) were jointly administered under the caption In re Extraction Oil & Gas., et al. Case No. 20-11548 (CSS). While in Chapter 11, the Debtors continued to operate their businesses and manage their properties as “debtors-in-possession” under the jurisdiction of the Bankruptcy Court and in accordance with the applicable provisions of the Bankruptcy Code and orders of the Bankruptcy Court. The commencement of a voluntary proceeding in bankruptcy constituted an immediate event of default under the Predecessor Credit Agreement (as defined in Note 8—Long-Term Debt) and the indentures governing the Company’s Senior Notes (as defined in Note 2—Basis of Presentation and Significant Accounting Policies), resulting in the automatic and immediate acceleration of all of the Company’s debt outstanding under the Predecessor Credit Agreement and Senior Notes. Accordingly, the Company has classified its outstanding Senior Notes debt as liabilities subject to compromise on its consolidated balance sheet as of December 31, 2020. The Prior Credit Facility (as defined in Note 8—Long-Term Debt) was not classified as liabilities subject to compromise because it was fully secured and unimpaired before being paid off as part of the Company’s emergence from bankruptcy described below. Please refer to Note 5—Liabilities Subject to Compromise for more information. Pursuant to the Bankruptcy Code and as described in Note 8—Long-Term Debt, the filing of the Chapter 11 Cases automatically stayed most actions against the Debtors, including most actions to collect indebtedness incurred prior to the Petition Date or to exercise control over the Debtors’ property. Plan, Disclosure Statement, and Backstop Commitment Agreement On July 30, 2020, the Debtors filed a proposed Plan of Reorganization (as amended, modified, or supplemented from time to time, the “Plan”) and related Disclosure Statement (as amended or modified, the “Disclosure Statement”) describing the Plan and the solicitation of votes to approve the same from certain of the Debtors’ creditors with respect to the Chapter 11 Cases. Subsequently on October 22, 2020 and November 5, 2020, the Debtors filed first and second amendments, respectively, to the Disclosure Statement. The hearing to consider approval of the Disclosure Statement was held on November 6, 2020. On November 6, 2020, the Bankruptcy Court approved the adequacy of the Disclosure Statement and the Debtors commenced a solicitation process to receive votes on the Plan. Pursuant to the terms of the Plan and as described in the Disclosure Statement, the Debtors also commenced a rights offering (the “Equity Rights Offering”), which was backstopped by certain holders of the Senior Notes. On November 6, 2020, the Bankruptcy Court approved the Backstop Commitment Agreement (the “Backstop Commitment Agreement”), which provided a commitment of $200 million. The hearing on the confirmation of the Plan was held on December 23, 2020, in which the Plan was approved. Emergence from Chapter 11 Bankruptcy On December 23, 2020, the Company filed the Sixth Amended Joint Plan of Reorganization of Extraction Oil & Gas, Inc. pursuant to Chapter 11 of the Bankruptcy Code. Also on December 23, 2020, the Bankruptcy Court entered an order (the “Confirmation Order”) confirming the Plan. The Plan is attached to the Confirmation Order as Exhibit A. The sixth-amended Plan and the Confirmation Order were previously filed as Exhibits 2.1 and 99.1 to the Company’s Current Report on Form 8-K filed with the U.S. Securities and Exchange Commission on December 30, 2020. On January 20, 2021 (the “Emergence Date”) the Plan became effective in accordance with its terms and the Company emerged from the Chapter 11 Cases. On the Emergence Date and pursuant to the Plan: •The Company amended and restated its certificate of incorporation and bylaws; •The Company constituted a new board of directors; •The Company appointed a new Chief Executive Officer, President and Chief Operating Officer, and Chief Financial Officer; •The Company issued new common stock in the Successor Company (the “New Common Stock”) and New Warrants (as defined in Note 12—Equity): ◦2,832,833 shares of New Common Stock pro rata to holders of the 2024 Notes; ◦4,854,017 shares of New Common Stock pro rata to holders of the 2026 Notes; ◦179,472 shares of New Common Stock, 1,454,832 Tranche A Warrants to purchase 1,454,832 shares of New Common Stock and 727,420 Tranche B Warrants to purchase 727,420 shares of New Common Stock pro rata to holders of the Predecessor Company’s Series A Preferred Stock (the “Predecessor Preferred Stock”) outstanding prior to the Emergence Date; ◦179,496 shares of New Common Stock, 1,454,854 Tranche A Warrants to purchase 1,454,854 shares of New Common Stock and 727,443 Tranche B Warrants to purchase 727,443 shares of New Common Stock pro rata to holders of the Predecessor Company’s existing common stock (the “Predecessor Common Stock”) outstanding prior to the Emergence Date; ◦1,169,322 shares of New Common Stock to commitment parties under the Backstop Commitment Agreement in respect of the commitment premium due thereunder; ◦844,760 shares of New Common Stock to the commitment parties under the Backstop Commitment Agreement in connection with their backstop obligation thereunder to purchase unsubscribed shares of New Common Stock; ◦11,478,670 shares of New Common Stock were issued to participants in the Equity Rights Offering extended by the Company to the applicable classes under the Plan (including to the commitment parties party to the Backstop Commitment Agreement); and ◦13,392 shares of New Common Stock were issued to participants in rights offering extended by the Company to certain holders of general unsecured claims. •The Company entered into the RBL Credit Facility (as defined in Note 8—Long-Term Debt—RBL Credit Facility); •The Company terminated the Prior Credit Facility (as defined in Note 8—Long-Term Debt—Prior Credit Facility), and the holders of claims under the Prior Credit Facility each received its ratable portion of the RBL Credit Facility for its allowed claims. All liens and security interests granted to secure such obligations were automatically terminated and are of no further force and effect; •The Company terminated the DIP Credit Facility (as defined in Note 8—Long-Term Debt—DIP Credit Facility), and the holders of claims under the DIP Credit Facility received payment in full, in cash, for allowed claims. All liens and security interests granted to secure such obligations were automatically terminated and are of no further force and effect; •The holders of certain trade claims, administrative claims, other secured claims and other priority claims that were allowed by the Bankruptcy Court received payment in full in cash upon emergence or through the ordinary course of business after the Emergence Date. Tax Attributes and Net Operating Loss (“NOL”) Carryforwards As of December 31, 2020, the Company had substantial tax NOL carryforwards and other tax attributes. Under the U.S. Internal Revenue Code of 1986, as amended (the “Code”), our ability to use these NOLs and other tax attributes may be limited if the Company experiences an “ownership change,” as determined under Section 382 of the Code. Accordingly, on July 13, 2020, the Company obtained a final order from the Bankruptcy Court that was intended to prevent an ownership change during the pendency of the Chapter 11 Cases and therefore protect the Company’s ability to use its tax attributes by imposing certain notice procedures and transfer restrictions on the trading of the Company’s Predecessor Common Stock and Predecessor Preferred Stock. In general, the order applied to any person or entity that, directly or indirectly, beneficially owned (or would beneficially own as a result of a proposed transfer) at least 4.5% of the Company’s common stock or preferred stock. Such persons were required to notify the Company and the Bankruptcy Court before effecting a transaction involving the Company’s Predecessor Common Stock and Predecessor Preferred Stock, and the Company had the right to seek an injunction to prevent the transaction if it might have adversely affected the Company’s ability to use its tax attributes. The order also required any person or entity that, directly or indirectly, beneficially owned at least 50% of the Company’s Predecessor Common Stock and Predecessor Preferred Stock to notify the Company and the Bankruptcy Court prior to claiming any deduction for worthlessness of the Company’s Predecessor Common Stock and Predecessor Preferred Stock for a tax year ending before the Company’s emergence from chapter 11 protection and the Company had the right to seek an injunction to prevent the transaction if it might have adversely affected the Company’s ability to use its tax attributes. Any purchase, sale or other transfer of, or any claim of a deduction for worthlessness with respect to, the Company’s Predecessor Common Stock and Predecessor Preferred Stock in violation of the restrictions of the order would have been null and void ab initio as an act in violation of a Bankruptcy Court order and would therefore have conferred no rights on a proposed transferee or such holder, as applicable. However, the Company expects that it will be required to substantially reduce or eliminate certain of its tax attributes, including NOL carryforwards, as a result of cancellation of indebtedness income realized in connection with the Chapter 11 Cases. Additionally, the consummation of the Plan on the Emergence Date resulted in an “ownership change” under Section 382 of the Code. Absent an applicable exception, if a corporation undergoes an “ownership change,” the amount of its pre-ownership change NOLs that may be utilized to offset future taxable income generally will be subject to an annual limitation equal to the value of its stock immediately prior to the ownership change multiplied by the long-term tax-exempt rate, plus an additional amount calculated based on certain “built in gains” in its assets that may be deemed to be realized within a 5-year period following any ownership change. This limitation, in the case of the ownership change that occurred as a result of the consummation of the Plan, will be subject to additional rules under Sections 382(l)(5) or (l)(6) of the Code, depending upon whether we are eligible for the application of Section 382(l)(5) of the Code and, if so eligible, whether we affirmatively elect not to apply Section 382(l)(5) of the Code. As a result of such limitation, the Company’s ability to utilize any NOLs or other tax attributes that are not eliminated as a result of cancellation of indebtedness income arising from the consummation of the Plan may be materially limited in the future. Fresh-Start Reporting Upon the Emergence Date, we began our assessment of our qualifications for fresh-start reporting. In order to qualify for fresh-start reporting, under Accounting Standards Codification (“ASC”) Topic 852 — Reorganizations, (i) the holders of existing voting shares of the Company prior to its emergence must receive less than 50% of the voting shares of the Company outstanding following its emergence from bankruptcy and (ii) the reorganization value of our assets immediately prior to confirmation of the plan of reorganization must be less than the post-petition liabilities and allowed claims. If we qualify for fresh-start reporting, a new reporting entity will be considered to have been created, and, as a result, the Company will allocate the reorganization value of the Company to its individual assets, including property, plant and equipment, based on their estimated fair values. The process of estimating the fair value of the Company’s assets, liabilities and equity upon emergence is currently ongoing and, therefore, neither the amounts nor the qualification for this accounting treatment have been finalized. In support of the Plan, the enterprise value of the Successor Company was estimated and approved by the Bankruptcy Court to be in the range of $875 million to $1.275 billion. On the Emergence Date, pursuant to the terms of the Plan, the Successor Company entered into a $1.0 billion reserve-based credit agreement with an initial borrowing base of $500.0 million. Please see Note 8—Long-Term Debt for discussion of the Successor Company’s debt. Deconsolidation of Elevation Midstream, LLC Elevation Midstream, LLC (“Elevation”), a Delaware limited liability company, is focused on the construction and operation of gathering systems and facilities to serve the development of acreage in the Company’s Hawkeye and Southwest Wattenberg areas. Midstream assets of Elevation are represented as the gathering systems and facilities line item within the consolidated balance sheets for any periods ended on or prior to December 31, 2019. During the first quarter of 2020, Elevation’s then non-controlling interest owner, which owned 100% of Elevation’s preferred stock, per contractual agreement, expanded Elevation’s then five member board of managers by four seats and filled them with managers of their choosing (the “Board Expansion”). Because Extraction had the right to appoint only three of the managers of Elevation before and after Board Expansion, Extraction determined the Company had lost voting control of Elevation, and on March 16, 2020 deconsolidated Elevation and began accounting for the entity as an equity method investment. Though Extraction determined control of Elevation was lost under the voting interest model of consolidation, the Company also determined significant influence was not lost due to (1) Extraction owning 100% of the common stock, (2) Extraction appointing three of the nine managers of Elevation and (3) Extraction’s continuing involvement in the day-to-day operation of Elevation through a management services agreement. Because Extraction also determined the Company is not the primary beneficiary, Elevation Midstream, LLC is not a variable interest entity. Extraction elected the fair value option to remeasure the Elevation equity method investment and determined it had no fair value. The Company recorded a $73.1 million loss on deconsolidation of the investment in the consolidated statements of operations for the three months ended March 31, 2020. Also during the three months ended March 31, 2020, Elevation determined certain gathering systems and facilities were impaired by $50.3 million as a result of the abandonment of certain projects. In accordance with ASC Topic 323-10-35-20: Investments—equity method and joint ventures, Extraction discontinued applying the equity method for Elevation as the impairment charge would have reduced the investment below zero. On May 1, 2020, Elevation’s board of managers issued 1,530,000,000 common units at a price of $0.01 per unit to certain of Elevation’s members other than Extraction (the “Capital Raise”). The Capital Raise caused Extraction’s ownership of Elevation to be diluted to less than 0.01%. As a result of the Capital Raise, beginning in May 2020 Extraction began accounting for Elevation under the cost method of accounting. In December 2020, the Company reached a settlement with Elevation (as discussed in Note 16—Commitments and Contingencies — Elevation Gathering Agreements) which was approved by the Bankruptcy Court. As part of the settlement, the Company relinquished its remaining ownership in Elevation and has no more interest in Elevation as of December 31, 2020.

Basis of Presentation and Significant Accounting Policies

12 Months Ended

Dec. 31, 2020

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Basis of Presentation and Significant Accounting Policies

Basis of Presentation

The consolidated financial statements include the accounts of the Company, including its subsidiaries. All significant intercompany balances and transactions have been eliminated in consolidation. The financial statements included herein were prepared from the records of the Company in accordance with accounting principles generally accepted in the United States of America (“GAAP”).

Use of Estimates in the Preparation of Financial Statements

The preparation of the consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of oil and gas reserves, assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Significant areas requiring the use of assumptions, judgments and estimates include (1) oil and gas reserves; (2) cash flow estimates used in impairment testing of oil and gas properties and goodwill; (3) depreciation, depletion, amortization and accretion; (4) asset retirement obligations; (5) assigning fair value and allocating purchase price in connection with business combinations, including the determination of any resulting goodwill; (6) accrued revenue and related receivables; (7) valuation of commodity derivative instruments; (8) accrued liabilities; (9) valuation of stock-based payments, and (10) income taxes. Although management believes these estimates are reasonable, actual results could differ from these estimates. The Company evaluates its estimates on an on-going basis and bases its estimates on historical experience and on various other assumptions the Company believes to be reasonable under the circumstances.

Significant Accounting Policies

Beginning after the Petition Date, the Company has applied ASC Topic 852 — Reorganizations in preparing the consolidated financial statements. ASC 852 requires the financial statements, for periods subsequent to the Chapter 11 Cases’ filing date, to distinguish transactions and events that are directly associated with the reorganization from the ongoing operations of the business. Accordingly, certain expenses incurred during the bankruptcy proceedings, including unamortized debt issuance costs associated with debt classified as liabilities subject to compromise, are recorded as reorganization items. In addition, pre-petition obligations that may be impacted by the chapter 11 process have been classified on the consolidated balance sheets as liabilities subject to compromise. These liabilities are reported at the amounts the Company anticipates will be allowed by the Bankruptcy Court, even if they may be settled for lesser amounts.

GAAP requires certain additional reporting for financial statements prepared between the Petition Date and the date that the Company emerges from bankruptcy, including:

•Reclassification of pre-petition liabilities that are unsecured, under-secured or where it cannot be determined that the liabilities are fully secured to a separate line item in the consolidated balance sheets called liabilities subject to compromise; and

•Segregation of reorganization items as a separate line in the consolidated statements of operations outside of income from continuing operations.

Debtor-In-Possession

As of December 31, 2020, the Debtors operated as debtors in possession in accordance with the applicable provisions of the Bankruptcy Code. The Bankruptcy Court approved motions filed by the Debtors that were designed primarily to mitigate the impact of the Chapter 11 Cases on the Company’s operations, customers and employees. As a result, the Company conducted normal business activities during 2020 and paid all associated obligations for the period following its bankruptcy filing in the ordinary course of business and was authorized to pay and have paid certain pre-petition obligations, including, among other things, for employee wages and benefits and certain goods and services provided. During the Chapter 11 Cases, transactions outside the ordinary course of business required prior approval of the Bankruptcy Court.

Automatic Stay

Subject to certain specific exceptions under the Bankruptcy Code, the Chapter 11 Cases automatically stayed most judicial or administrative actions against the Debtors and efforts by creditors to collect on or otherwise exercise rights or remedies with respect to pre-petition claims. Absent an order from the Bankruptcy Court, substantially all of the Debtors’ pre-petition liabilities are subject to settlement under the Bankruptcy Code.

Executory Contracts

Subject to certain exceptions, under the Bankruptcy Code, the Debtors may assume, assign, or reject certain executory contracts and unexpired leases subject to the approval of the Bankruptcy Court and certain other conditions. Generally, the rejection of an executory contract or unexpired lease is treated as a pre-petition breach of such executory contract or unexpired lease and, subject to certain exceptions, relieves the Debtors from performing their future obligations under such executory contract or unexpired lease but entitles the contract counterparty or lessor to a pre-petition general unsecured claim for damages caused by such deemed breach. Generally, the assumption of an executory contract or unexpired lease requires the Debtors to cure existing monetary defaults under such executory contract or unexpired lease and provide adequate assurance of future performance. Please refer to Note 5—Liabilities Subject to Compromise and Note 16—Commitments and Contingencies — Delivery Commitments for more information.

Potential Claims

The Debtors have filed with the Bankruptcy Court schedules and statements setting forth, among other things, the assets and liabilities of each of the Debtors, subject to the assumptions filed in connection therewith. These schedules and statements may be subject to further amendment or modification after filing. Certain holders of pre-petition claims that are not governmental units were required to file proofs of claim by the bar date of August 14, 2020. As of March 9, 2021, the Debtors’ have received approximately 2,600 proofs of claim, primarily representing general unsecured claims, for an amount of approximately $5.8 billion. The Bankruptcy Court does not allow for claims that have been acknowledged as duplicates. Approximately 1,100 claims totaling approximately $4.2 billion have been withdrawn, disallowed or are pending approval to be

disallowed. These claims will be reconciled to amounts recorded in liabilities subject to compromise in the consolidated balance sheet. Differences in amounts recorded and claims filed by creditors will be investigated and resolved, including through the filing of objections with the Bankruptcy Court, where appropriate. The Company may ask the Bankruptcy Court to disallow claims that the Company believes are duplicative, have been later amended or superseded, are without merit, are overstated or should be disallowed for other reasons. In light of the substantial number of claims filed, the claims resolution process may take considerable time to complete and is continuing even after the Debtors emerged from bankruptcy.

Financial Statement Classification of Liabilities Subject to Compromise

The accompanying consolidated balance sheets as of December 31, 2020 includes amounts classified as liabilities subject to compromise, which represent liabilities the Company anticipates will be allowed as claims in the Chapter 11 Cases. These amounts represent the Debtors’ current estimate of known or potential obligations to be resolved in connection with the Chapter 11 Cases, and may differ from actual future settlement amounts paid. Differences between liabilities estimated and claims filed, or to be filed, will be investigated and resolved in connection with the claims resolution process. The Company will continue to evaluate these liabilities throughout the chapter 11 process and adjust amounts as necessary. Such adjustments may be material. Please refer to Note 5—Liabilities Subject to Compromise for more information.

Reorganization Items, Net

The Debtors have incurred and will continue to incur significant costs associated with the reorganization, primarily from damages for rejected or settled contracts and legal and professional fees. The amount of these costs, which since the Petition Date, are being expensed as incurred, are expected to significantly affect the Company’s results of operations. In accordance with applicable guidance, costs associated with the bankruptcy proceedings have been recorded as reorganization items within the Company’s accompanying consolidated statements of operations for the year ended December 31, 2020. Please refer to Note 6—Reorganization Items, Net for more information.

Other Operating Expenses

Other operating expenses were $79.6 million for the year ended December 31, 2020, respectively. There were no other operating expenses for the years ended December 31, 2019 and 2018. The total amount in the current year is made up of the following:

•$46.8 million loss contingency from an alleged breach in contract stemming from a purported failure to complete the pipeline extensions connecting certain wells to the Badger central gathering facility prior to April 1, 2020. Please see Note 16—Commitments and Contingencies for further details.

•$4.2 million of accrued interest related to the aforementioned alleged breach in contract.

•$13.2 million early termination penalty for the revenue contract terminated in June 2020. Please see the section Contract Balance below for further details.

•$7.6 million of expenses related to workforce reductions in February and May 2020.

•$4.1 million of interest expense on unpaid production taxes recorded in the last half of 2020.

•$2.4 million of expenses related to drilling rig standby charges during the second quarter of 2020.

•$1.3 million of expenses related to legal accruals and other.

Cash and Cash Equivalents

Cash and cash equivalents consist of all highly liquid investments that are readily convertible into cash and have original maturities of three months or less when purchased.

Accounts Receivable

The Company records estimated oil and gas revenue receivable from third parties at its net revenue interest. The Company also reflects costs incurred on behalf of joint interest partners in accounts receivable. The Company generally has the ability to withhold future revenue disbursements to recover non-payment of joint interest billings. On an on-going basis, management reviews accounts receivable amounts for collectability and records its allowance for uncollectible receivables based on expected losses. The Company did not record any allowance for uncollectible receivables as of December 31, 2020 and 2019.

Credit Risk and Other Concentrations

The Company’s cash and cash equivalents are exposed to concentrations of credit risk. The Company manages and controls this risk by investing these funds with major financial institutions. The Company often has balances in excess of the federally insured limits.

The Company sells oil, natural gas and NGL to various types of customers, including oil marketers, pipelines and refineries. Credit is extended based on an evaluation of the customer’s financial conditions and historical payment record. The future availability of a ready market for oil, natural gas and NGL depends on numerous factors outside the Company’s control, none of which can be predicted with certainty. For the years ended December 31, 2020, 2019 and 2018, respectively, the Company had the following customers that exceeded 10% of total oil, natural gas and NGL revenues. The Company does not believe the loss of any single purchaser would materially impact its operating results because crude oil, natural gas and NGL are fungible products with well-established markets and numerous purchasers.


	For the Year Ended December 31,
	2020		2019		2018
Customer A	28	%	77	%	76	%
Customer B	16	%	<10%		<10%
Customer C	12	%	<10%		<10%
Customer D	<10%		<10%		11	%

At December 31, 2020, the Company had commodity derivative contracts with two counterparties, both of which are lenders under the Predecessor Credit Agreement. The Company does not require collateral or other security from counterparties to support derivative instruments; however, to minimize the credit risk in derivative instruments, it is the Company’s policy to enter into derivative contracts only with counterparties that are credit worthy financial institutions deemed by management as competent and competitive market-makers. Additionally, the Company uses master netting agreements to minimize credit-risk exposure. The credit worthiness of the Company’s counterparties is subject to periodic review. For the years ended December 31, 2020, 2019 and 2018, the Company did not incur any losses with respect to counterparty contracts. None of the Company’s existing derivative instrument contracts contains credit-risk related contingent features.

Inventory, Prepaid Expenses and Other

The Company records well equipment inventory at the lower of cost or net realizable value. Prepaid expenses are recorded at cost. Inventory, prepaid expenses and other are comprised of the following (in thousands):


	As of December 31,
	2020		2019
Well equipment inventory	$	11,989	$	20,960
Prepaid expenses	8,456		5,793
Line fill	14,115		—
Deposits	1,822		—
Contractual asset under ASC 606	—		9,949
	$	36,382	$	36,702

The Company recognized impairment expense on well equipment inventory in the amount of $2.1 million for the year ended December 31, 2020. No such impairment expense was recognized for the year ended December 31, 2019. The Company recognized impairment expense on well equipment inventory in the amount $0.1 million for the year ended December 31, 2018.

Oil and Gas Properties

The Company follows the successful efforts method of accounting for oil and gas properties. Under this method of accounting, all property acquisition costs and development costs are capitalized when incurred and depleted on a units-of-production basis over the remaining life of proved reserves and proved developed reserves, respectively. For the years ended

December 31, 2020, 2019 and 2018, the Company excluded $129.1 million, $149.7 million and $144.3 million, respectively, of capitalized costs from depletion related to wells in progress. For the years ended December 31, 2020, 2019 and 2018, the

Company recorded depletion expense on capitalized oil and gas properties of $321.0 million, $513.7 million and $426.8 million, respectively.

The costs of exploratory wells are initially capitalized pending a determination of whether proved reserves have been found. At the completion of drilling activities, the costs of exploratory wells remain capitalized if a determination is made that proved reserves have been found. If no proved reserves have been found, the costs of exploratory wells are charged to expense. In some cases, a determination of proved reserves cannot be made at the completion of drilling, requiring additional testing and evaluation of the wells. Costs incurred for exploratory wells that find reserves that cannot yet be classified as proved are capitalized if (a) the well has found a sufficient quantity of reserves to justify its completion as a producing well and (b) sufficient progress in assessing the reserves and the economic and operating viability of the project has been made. The status of suspended well costs is monitored continuously and reviewed at each period end. Due to the capital-intensive nature and the geological characteristics of certain projects, it may take an extended period of time to evaluate the future potential of an exploration project and the economics associated with making a determination of its commercial viability. As of December 31, 2020 and 2019, the Company had no suspended well costs.

Geological and geophysical costs are expensed as incurred. Costs of seismic studies that are utilized in development drilling within an area of proved reserves are capitalized as development costs. Amounts of seismic costs capitalized are based on only those blocks of data used in determining development well locations. To the extent that a seismic project covers areas of both developmental and exploratory drilling, those seismic costs are proportionately allocated between development costs and exploration expense. The Company expensed $0.2 million, $0.2 million and $0.4 million of costs associated with exploratory geological and geophysical costs for the years ended December 31, 2020, 2019 and 2018, respectively.

The Company capitalizes interest, if debt is outstanding, during drilling operations in its exploration and development activities. For the years ended December 31, 2020, 2019 and 2018, the Company capitalized interest of approximately $5.3 million, $7.2 million and $8.2 million, respectively.

Net carrying values of retired, sold or abandoned properties that constitute less than a complete unit of depreciable property are charged or credited, net of proceeds, to accumulated depreciation, depletion and amortization unless doing so significantly affects the unit-of-production amortization rate, in which case a gain or loss is recognized in income. Gains or losses from the disposal of complete units of depreciable property are recognized to earnings.

For sales of entire working interests in unproved properties, gain or loss is recognized to the extent of the difference between the proceeds received and the net carrying value of the property. Proceeds from sales of partial interests in unproved properties are accounted for as a recovery of costs unless the proceeds exceed the entire cost of the property.

Impairment of Oil and Gas Properties

Proved oil and gas properties are reviewed for impairment annually or when events and circumstances indicate a possible decline in the recoverability of the carrying amount of such property. For all of its fields, the Company estimates the expected future cash flows of its oil and gas properties and compares these undiscounted cash flows to the carrying amount of the oil and gas properties to determine if the carrying amount is recoverable. If the carrying amount exceeds the estimated undiscounted future cash flows, the Company will write down the carrying amount of the oil and gas properties to fair value. The factors used to determine fair value include, but are not limited to, estimates of reserves, future commodity prices, future production estimates, estimated future capital expenditures, estimated future operating costs, and discount rates commensurate with the risk associated with realizing the projected cash flows. Impairment expense for proved oil and gas properties is reported in impairment of long lived assets and goodwill in the consolidated statements of operations, which increases accumulated depletion, depreciation and amortization. For the year ended December 31, 2020, the Company recognized $3.6 million related to impairment of the proved oil and gas properties in our northern field and $194.3 million related to oil and gas properties in one of our Core DJ Basin fields, as the fields’ fair values did not exceed the carrying amounts associated with our oil and gas properties. For the year ended December 31, 2019, the Company recognized $14.5 million related to impairment of the proved oil and gas properties in its northern field and $1.3 billion related to assets in its Core DJ Basin field as the field’s fair values did not exceed the carrying amounts associated with its proved oil and gas properties. For the year ended December 31, 2018, the Company recognized $16.2 million related to impairment of the proved oil and gas properties in its northern field as the fair value did not exceed the carrying amount associated with its proved oil and gas properties in its northern field.

Unproved oil and gas properties consist of costs to acquire unevaluated leases as well as costs to acquire unproved reserves. The Company evaluates significant unproved oil and gas properties for impairment based on remaining lease term, drilling results, reservoir performance, seismic interpretation or future plans to develop acreage. When successful wells are

drilled on undeveloped leaseholds, unproved property costs are reclassified to proved properties and depleted on a unit-of-production basis. Impairment expense and lease extension payments for unproved properties is reported in exploration and abandonment expenses in the consolidated statements of operations. As a result of the abandonment of unproved properties, the Company recognized $253.1 million, $73.7 million and $25.7 million of abandonment expense for the years ended December 31, 2020, 2019 and 2018, respectively.

Other Property and Equipment

Other property and equipment consists of (i) compressors, compressor stations, central tank batteries and disposal well facilities used in Extraction’s oil and gas operations, (ii) land, (iii) rights of ways, pipeline and engineering costs, (iv) office leasehold improvements, (v) the field office, and (vi) other property and equipment including office furniture and fixtures and computer hardware and software. Impairment expense for other property and equipment is reported in impairment of long lived assets and goodwill in the consolidated statements of operations. No impairment expense was incurred related to midstream facilities for the year ended December 31, 2020. The Company recognized $0.1 million and $0.4 million in impairment expense related to midstream facilities for the year ended December 31, 2019 and December 31, 2018, respectively, which increased accumulated depreciation recognized in other property and equipment, net of accumulated depreciation. These impairment expenses were primarily the result of right-of-way options that were no longer in the Company’s plans for developing midstream infrastructure. The gain or loss on the sale of other property and equipment is reported in gain (loss) on sale of property and equipment and assets of unconsolidated subsidiary in the consolidated statements of operations. The Company recognized $4.5 million, $3.1 million and $0.8 million of impairment expense related to land, midstream facilities and rental equipment, respectively, for the year ended December 31, 2020. The Company also wrote off $2.6 million of leasehold improvements during the year ended December 31, 2020 due to a consolidation of leased office space.

The estimated useful lives of those assets depreciated under the straight-line method are as follows:


Rental equipment			1-10 years
Office leasehold improvements			3-10 years
Field office			30 years
Other			3-5 years

Other property and equipment is comprised of the following (in thousands):


	As of December 31,
	2020		2019
Rental equipment	$	3,251	$	4,043
Land	39,788		42,273
Right-of-ways and pipeline	8,008		8,008
Office leasehold improvements	4,390		7,009
Field office	18,447		18,317
Other	8,604		8,884
Less: accumulated depreciation and impairment charges	(25,787)		(15,992)
	$	56,701	$	72,542

Gathering Systems and Facilities

Gathering systems and facilities consisted of midstream assets such as land, rights of way, pipelines, equipment and construction and engineering costs associated with the construction of pipeline infrastructure to serve the development of the Company’s acreage in its Hawkeye and Southwest Wattenberg areas. As discussed in Note 1 — Business and Organization — Deconsolidation of Elevation Midstream, LLC, during the first quarter of 2020 the Company deconsolidated Elevation Midstream, LLC.

Gathering systems and facilities is comprised of the following (in thousands):


	As of December 31,
	2020		2019
Gathering systems and facilities	$	—	$	314,906
Land associated with gathering systems and facilities	—		2,188
Less: accumulated depreciation	—		(1,317)
	$	—	$	315,777

Gathering systems and facilities balances are evaluated for potential impairment when events or changes in circumstances indicate that their carrying amounts may not be recoverable from expected undiscounted cash flows from the use and eventual disposition of an asset. If the carrying amount of the asset is not expected to be recoverable from future undiscounted cash flows, an impairment may be recognized. Any impairment is measured as the excess of the carrying amount of the asset over its estimated fair value.

In assessing gathering systems and facilities assets for impairment, management evaluates changes in business and economic conditions and their implications for recoverability of the assets’ carrying amounts. The measure of impairments to be recognized, if any, depends upon management’s estimate of the asset’s fair value, which may be determined based on the estimates of future net cash flows or values at which similar assets were transferred in the market in recent transactions, if such data is available. Gathering systems and facilities are recorded at historical cost and depreciated using the straight-line method over 30 years.

In March 2020, Elevation determined certain gathering systems and facilities were impaired by $50.3 million as a result of the abandonment of certain projects. In accordance with ASC Topic 323-10-35-20: Investments—equity method and joint ventures, Extraction discontinued applying the equity method investment for Elevation as the impairment charge would have reduced the investment below zero. For further information on the deconsolidation of Elevation Midstream, LLC, please see Note 1—Business and Organization — Deconsolidation of Elevation Midstream, LLC. No impairment expense was recognized for the years ended December 31, 2019 and 2018 associated with gathering systems and facilities.

Equity Method Investments

Investments in entities for which the Company exercises significant influence, but not control, are accounted for under the equity method of accounting. The Company recorded $44.6 million of such investments included in other non-current assets on the consolidated balance sheets as of December 31, 2019 but had no equity method investment as of December 31, 2020 due to the deconsolidation of Elevation Midstream discussed in Note 1 — Business and Organization — Deconsolidation of Elevation Midstream, LLC. Please refer to Note 16 — Commitments and Contingencies — Delivery Commitments for more information. The Company recognized $0.5 million, $2.3 million and $2.9 million of net income from such investments, including the accretion of any basis difference between the carrying amount of the investment and the amount of underlying equity in net assets, included in other income on the consolidated statements of operations and equity in earnings of unconsolidated subsidiary, in which we had a minority ownership interest on the consolidated statements of cash flows for the years ended December 31, 2020, 2019 and 2018, respectively.

For the year ended December 31, 2019, a gain on sale of unconsolidated subsidiary of $1.0 million was recorded relating to Elevation’s August 2018 Divestiture. In August 2018, Elevation received proceeds of $83.6 million and recognized a gain of $83.6 million for the year ended December 31, 2018, upon the sale of assets of DJ Holdings, LLC, a subsidiary of Discovery Midstream Partners, LP, of which Elevation held a 10% membership interest. The Company acquired its interest in exchange for the contribution of an acreage dedication, which is considered a nonfinancial asset.

Deferred Lease Incentives

All incentives received from landlords for office leasehold improvements are recorded as deferred lease incentives and amortized over the term of the respective lease on a straight-line basis as a reduction of rental expense. The Company wrote off $2.6 million of leasehold improvements during the year ended December 31, 2020 due to a consolidation of leased office space.

Debt Issuance Costs

Debt issuance costs include origination, legal, engineering, and other fees incurred to issue the debt in connection with the Company’s Prior Credit Facility, DIP Credit Facility (as defined in Note 8 — Long Term Debt), 2024 Senior Notes and 2026 Senior Notes (collectively, the “Senior Notes”). Debt issuance costs related to the Prior Credit Facility are included in other non-current assets on the consolidated balance sheets and amortized to interest expense on the consolidated statement of operations on a straight-line basis over the respective borrowing term. Debt issuance costs related to the Senior Notes prior to the Chapter 11 Cases were amortized to interest expense using the effective interest method over the term of the debt. However, as a result of the Chapter 11 Cases, the Company expensed $13.5 million of debt issuance costs pertaining to the Senior Notes to reorganization items, net on the consolidated statements of operations for the year ended December 31, 2020. Debt issuance costs of $1.7 million pertaining to the DIP Credit Facility were expensed to reorganization items, net during the year ended December 31, 2020.

Commodity Derivative Instruments

The Company has entered into commodity derivative instruments to reduce the effect of price changes on a portion of the Company’s future oil and natural gas production. The commodity derivative instruments are measured at fair value and are included in the accompanying balance sheets as commodity derivative assets and commodity derivative liabilities. The Company has not designated any of the derivative contracts as fair value or cash flow hedges. Therefore, the Company does not apply hedge accounting to the commodity derivative instruments. Net gains and losses on commodity derivative instruments are recorded based on the changes in the fair values of the derivative instruments. Net gains and losses on commodity derivative instruments are recorded in the commodity derivatives gain (loss) line on the consolidated statements of operations. The Company’s cash flow is only impacted when the actual settlements under the commodity derivative contracts result in making or receiving a payment to or from the counterparty. These settlements under the commodity derivative contracts are reflected as operating activities in the Company’s consolidated statements of cash flows.

Any premiums paid on derivative contracts are capitalized as part of the derivative assets or derivative liabilities, as appropriate, at the time the premiums are paid. Premium payments are reflected in cash flows from operating activities in the Company’s consolidated statements of cash flows. Over time, as the derivative contracts settle, the differences between the cash received and the premiums paid or fair value of contracts acquired are recognized in net gains or losses on commodity or interest rate derivative contracts, and the cash received is reflected in cash flows from operating activities in the Company’s consolidated statements of cash flows.

The Company’s valuation estimate takes into consideration the counterparties’ credit worthiness, the Company’s credit worthiness, and the time value of money. The consideration of these factors results in an estimated exit-price for each derivative asset or liability under a market participant’s view. Management believes that this approach provides a reasonable, non-biased, verifiable, and consistent methodology for valuing commodity derivative instruments. Please refer to Note 9 — Commodity Derivative Instruments for additional discussion on commodity derivative instruments.

Goodwill and Other Intangible Assets

The Company applies the provisions of ASC 350, Intangibles-Goodwill and Other. Goodwill represents the excess of the purchase price over the estimated value of the net assets acquired in business combinations. The Company tests goodwill for impairment annually on September 30, or whenever other circumstances or events indicate that the carrying amount of goodwill may not be recoverable. The goodwill test is performed at the reporting unit level, which represents the Company’s oil and gas operations in its Core DJ Basin field. If indicators of impairment are determined to exist, an impairment charge is recognized if the carrying value of goodwill exceeds its implied fair value. Any sharp prolonged decreases in the prices of oil and natural gas as well as continued declines in the quoted market price of the Company’s common shares could change the estimates of the fair value of the reporting unit and could result in an impairment charge. The Company performed a quantitative assessment as of September 30, 2018, which concluded the fair value of the reporting unit was greater than its carrying amount. The Company identified triggering events as of December 31, 2018, due to the decrease in commodity pricing and the quoted market price of the Company's common shares compared to September 30, 2018. As such, the Company performed a quantitative assessment as of December 31, 2018, utilizing an income approach based on estimates of the expected discounted future cash flows of the reporting unit's oil and gas properties, which concluded the fair value of the reporting unit was not greater than its carrying amount. As a result, the Company recorded goodwill impairment of $54.2 million, the entirety of the balance, for the year ended December 31, 2018. As such, no test for goodwill impairment was necessary for the year ended December 31, 2020 and 2019.

Costs relating to the acquisition of internal-use software licenses are capitalized when incurred and amortized over the estimated useful life of the license, which is typically one to three years. The Company recorded $0.3 million, $2.2 million and $3.0 million of capitalized internal-use software costs for the years ended December 31, 2020, 2019 and 2018, respectively, on the consolidated balance sheets within the other non-current assets line item. Accumulated amortization for the years ended December 31, 2020 and 2019 was $6.8 million and $5.3 million, respectively. The Company recognized $1.6 million, $2.2 million and $2.1 million of amortization expense for the years ended December 31, 2020, 2019 and 2018, respectively.

Fair Value of Financial Instruments

The Company’s financial instruments consist primarily of cash and cash equivalents, accounts receivable, accounts payable, commodity derivative instruments (discussed above) and long-term debt. The carrying values of cash and cash equivalents, accounts receivable and accounts payable are representative of their fair values due to their short-term maturities. The carrying amounts of the Company’s Prior Credit Facility and DIP Credit Facility approximates fair value as it bears interest at variable rates over the term of the loans. The Company’s Senior Notes are recorded at cost and the fair value is disclosed in Note 11 — Fair Value Measurements. Considerable judgment is required to develop estimates of fair value. The estimates provided are not necessarily indicative of the amounts the Company would realize upon the sale or refinancing of such instruments.

Asset Retirement Obligation

The Company recognizes estimated liabilities for future costs associated with the abandonment of its oil and gas properties. A liability for the fair value of an asset retirement obligation and corresponding increase to the carrying value of the related long-lived asset are recorded at the time the Company makes the decision to complete the well or a well is acquired. For additional discussion on asset retirement obligations please refer to Note 10 — Asset Retirement Obligations.

Environmental Liabilities

The Company is subject to federal, state and local environmental laws and regulations. These laws regulate the release, disposal or discharge of materials into the environment or otherwise relating to environmental protection and may require the Company to remove or mitigate the environmental effects of the discharge, disposal or release of petroleum substances at various sites. Environmental expenditures are expensed or capitalized depending on their future economic benefit. Expenditures that relate to an existing condition caused by past operations and that have no future economic benefit are expensed.

Liabilities for expenditures of a non-capital nature are recorded when environmental assessments and/or remediation is probable, and the costs can be reasonably estimated. Such liabilities are generally undiscounted values unless the timing of cash payments for the liability or component is fixed or determinable. Management has determined that no significant environmental liabilities existed as of December 31, 2020. Please refer to Note 16 — Commitments and Contingencies for additional discussion on environmental liabilities.

Revenue Recognition

Revenue from the sale of oil, natural gas and NGLs is recognized in accordance with ASC 606 - Revenue from Contracts with Customers (“ASC 606”) five-step revenue recognition model to depict the transfer of goods or services to customers in an amount that reflects the consideration to which the Company expects to be entitled in exchange for those goods or services. To account for producer imbalances, the Company recognizes revenues on all sales of oil, natural gas and NGLs to third party customers regardless of their ownership percentage and adjusts the underlifter or overlifter’s claim on the asset’s remaining reserves. In other words, revenue is recorded based on the Company’s share of volume sold, regardless of whether the Company has taken its proportional share of volume produced. A receivable or liability is recognized only to the extent that the Company has an imbalance on a specific property greater than the expected remaining proved reserves. As of December 31, 2020, 2019, and 2018, the Company had oil imbalances of 1.1, 12.7, and 22.0 MBbl, respectively, which the Company intends to settle with the counterparty in crude oil barrels. On January 1, 2018, the Company adopted ASC 606. See —Adoption of ASC 606 for more information regarding the adoption of this standard.

Stock-Based Payments

The Company has granted awards under the LTIP to certain directors, officers and employees, including stock options, restricted stock units, performance stock awards, performance stock units, performance cash awards and cash awards which therefore required the Company to recognize the expense in its consolidated financial statements.

All stock-based payments to directors, officers and employees are measured at fair value on the grant date and expensed over the relevant service period. The fair value of stock option awards is determined by using the Black-Scholes option pricing model. The fair value of the performance stock awards was measured at the grant date with a stochastic process method using a Monte Carlo simulation. All stock-based payment expense is recognized using the straight-line method and is included within general and administrative expenses in the consolidated statements of operations and stock-based compensation in the consolidated statements of cash flows. Forfeitures are recorded as they occur. Please refer to Note 14 — Stock-Based Compensation for additional discussion on stock-based payments.

Income Taxes

The Company accounts for income taxes using the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis and operating loss and tax credit carry forwards. Deferred tax assets and liabilities are calculated by applying existing tax laws and the rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period that includes the enactment date. The tax returns and the amount of taxable income or loss are subject to examination by deferral and state taxing authorities.

The Company periodically assesses whether it is more likely than not that it will generate sufficient taxable income to realize its deferred income tax assets, including NOLs. In making this determination, the Company considers all the available positive and negative evidence and makes certain assumptions. The Company considers, among other things, its deferred tax liabilities, the overall business environment, its historical earnings and losses, current industry trends, and its outlook for future years. The Company believes it is more likely than not that the benefit from NOL carryforwards will not be fully realized. In recognition of this risk, the Company has provided a valuation allowance on the deferred tax assets.

The Company recognizes the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities based on the technical merits of the position. The tax benefits recognized in the consolidated financial statements from such a position are measured based on the largest benefit that has a greater than fifty percent likelihood of being realized upon ultimate settlement. The Company does not currently have uncertain tax positions.

Earnings Per Share

Basic earnings per share (“EPS”) includes no dilution and is computed by dividing net income (loss) available to common shareholders by the weighted-average number of shares outstanding during the period. Diluted EPS reflects the potential dilution of securities that could share in the earnings available to common shareholders of the Company. The Company uses the “if-converted” method to determine the potential dilutive effects of its Series A Preferred Stock, and the treasury stock method to determine the potential dilutive effect of outstanding restricted stock units and stock option awards.

Segment Reporting

Beginning in the fourth quarter of 2018, the Company had two operating segments, (i) the exploration, development and production of oil, natural gas and NGL (the “exploration and production segment”) and (ii) the construction of and support of midstream assets to gather and process crude oil and gas production (the “gathering and facilities segment”). Elevation Midstream, LLC comprised the gathering and facilities segment. During the fourth quarter of 2019, the Company’s gathering and facilities segment commenced operations. Through March 16, 2020, the results of Elevation were included in the consolidated financial statements of Extraction. Effective March 17, 2020, the results of Elevation Midstream, LLC are no longer consolidated in Extraction’s results; however, the Company’s prior annual segment disclosures included the gathering and facilities segment because it was consolidated through March 16, 2020. Please see Note 1 — Business and Organization — Deconsolidation of Elevation Midstream, LLC for further information related to the deconsolidation of Elevation Midstream, LLC. After March 16, 2020, the Company had a single reportable segment.

All of the Company’s operations are conducted in one geographic area of the United States. All revenues are derived from customers located in the United States.

Recent Accounting Pronouncements

The accounting standard-setting organizations frequently issue new or revised accounting rules. The Company regularly reviews new pronouncements to determine their impact, if any, on its consolidated financial statements and related disclosures.

In March 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2020-04, Reference Rate Reform — Facilitation of the Effects of Reference Rate Reform on Financial Reporting (Topic 848). This ASU provides an optional expedient and exceptions for applying GAAP to contracts, hedging relationships, and other transactions affected by reference rate reform if certain criteria are met. In response to the concerns about structural risks of interbank offered rates (IBORs) and, particularly, the risk of cessation of the London Interbank Offered Rate (LIBOR), regulators in several jurisdictions around the world have undertaken reference rate reform initiatives to identify alternative reference rates that are more observable or transaction-based and less susceptible to manipulation. The ASU provides companies with optional guidance to ease the potential accounting burden associated with transitioning away from reference rates that are expected to be discontinued. In January 2021, the FASB issued ASU No. 2021-01, which clarifies that certain provisions in Topic 848, if elected by an entity, apply to derivative instruments that use an interest rate for margining, discounting, or contract price alignment that is modified as a result of reference rate reform. The amendments in these ASUs are effective for all entities as of March 12, 2020 through December 31, 2022. The Company is still evaluating the effect of adopting this guidance.

In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments—Credit Losses. In May 2019, ASU No. 2016-13 was subsequently amended by ASU No. 2019-04, Codification Improvements to Topic 326, Financial Instruments—Credit Losses and ASU No. 2019-05, Financial Instruments—Credit Losses (Topic 326): Targeted Transition Relief. ASU No. 2016-13, as amended, affects trade receivables, financial assets and certain other instruments that are not measured at fair value through net income. This ASU replaced the incurred loss approach with an expected loss model for instruments measured at amortized cost and was effective for financial statements issued for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. ASU No. 2016-13 will be applied using a modified retrospective approach through a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which the guidance is effective. The Company adopted this ASU on January 1, 2020, and the adoption did not have a material impact on the consolidated financial statements and related disclosures.

In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement (Topic 820) which removes or modifies current fair value disclosures and adds additional disclosures. The update to the guidance is the result of the FASB’s test of the principles developed in its disclosure effectiveness project, which is designed to improve the effectiveness of disclosures in the notes to the financial statements. The disclosures that have been removed or modified may be applied immediately with retrospective application. For public entities, the new guidance was effective for fiscal years beginning after December 15, 2019, including interim reporting periods within that reporting period. The Company adopted this ASU on January 1, 2020, and the adoption did not have a material impact on the consolidated financial statements and related disclosures.

In August 2018, the FASB issued ASU No. 2018-15, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40) which aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software and hosting arrangements that include an internal-use software license. For public entities, the guidance is effective for fiscal years beginning after December 15, 2019, including interim reporting periods within that reporting period. The Company adopted this ASU on January 1, 2020 which did not have a material impact on the consolidated financial statements and related disclosures as capitalized costs for internal-use software were not material during 2020.

In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) which requires lessee recognition on the balance sheet of a right of use asset and a lease liability, initially measured at the present value of the lease payments. It further requires recognition in the income statement of a single lease cost, calculated so that the cost of the lease is allocated over the lease term on a generally straight-line basis. Under the new standard, certain lease agreements with terms over one year are classified as right-of-use assets and right-of-use liabilities, which gross up the balance sheet. Finally, it requires classification of all cash payments within operating activities in the statements of cash flows. It is effective for fiscal years commencing after December 15, 2018. The FASB subsequently issued ASU No. 2017-13, ASU No. 2018-01, ASU No. 2018-10 and ASU No. 2018-11, which provided additional implementation guidance. The Company adopted these lease accounting standards on January 1, 2019 using a modified retrospective transition approach, which applied the provisions of the new guidance at the effective date without adjusting the comparative periods presented. Upon adoption, the Company elected the package of practical expedients permitted under the transition guidance with the new standard, which among other things, requires no reassessment of whether existing contracts are or contain leases as well as no reassessment of lease classification for existing

leases upon adoption. The Company also elected the optional practical expedient permitted under the transition guidance within the new standard related to land easements that allows it to carry forward its current accounting treatment for land easements on existing agreements. The Company made an accounting policy election to keep leases with an initial term of twelve months or less off of the consolidated balance sheets. Please refer to Note 7 — Leases for further information.

In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606) which establishes a comprehensive new revenue recognition model, referred to as ASC 606, designed to depict the transfer of goods or services to a customer in an amount that reflects the consideration the entity expects to receive in exchange for those goods or services. The ASU allows for the use of either the full or modified retrospective transition method. In August 2015, the FASB issued ASU No. 2015-14, which deferred ASU No. 2014-09 for one year, and was effective for annual reporting periods beginning after December 15, 2017, including interim reporting periods within that reporting period. The FASB subsequently issued ASU No. 2016-08, ASU No. 2016-10, ASU No. 2016-11, ASU No. 2016-12, ASU No. 2016-20, ASU No. 2017-13, ASU No. 2017-14 and ASU No. 2019-20, which provided additional implementation guidance. Refer to —Adoption of ASC 606 for more information.

Adoption of ASC 606

On January 1, 2018, the Company adopted ASC 606. The Company adopted ASC 606 using the modified retrospective method to apply the new standard to all new contracts entered into on or after January 1, 2018 and all existing contracts for which all (or substantially all) of the revenue has not been recognized under legacy revenue guidance. ASC 606 supersedes previous revenue recognition requirements in ASC 605 and includes a five-step revenue recognition model to depict the transfer of goods or services to customers in an amount that reflects the consideration to which the Company expects to be entitled in exchange for those goods or services.

Changes to sales of natural gas and NGL, as well as transportation and gathering expenses, are due to the conclusion that certain midstream processing entities are the Company’s customers in natural gas processing and marketing agreements in accordance with the five-step process in ASC 606. This is a change from previous conclusions reached for these agreements utilizing the principal versus agent indicators under ASC 605 where the Company determined it was the principal, the midstream processor was the agent and the third-party end user was its customer. As a result, the Company modified its presentation of revenues and operating expenses for these agreements. Revenues related to these agreements are now presented on a net basis for proceeds expected to be received from the midstream processing entity. Revenues from the sale of oil, natural gas and NGLs, where the Company is a non-operating interest partner, are considered in the scope of ASC 808 - Collaborative Arrangements. Therefore, ASC 606 did not change the presentation of these revenues.

Transportation and gathering expense related to other agreements incurred prior to the transfer of control to the customer at the tailgate of the natural gas processing facilities will continue to be presented as transportation and gathering expense.

Revenues from Contracts with Customers

Sales of oil, natural gas and NGLs are recognized at the point control of the commodity is transferred to the customer and collectability is reasonably assured. The majority of the Company’s contracts’ pricing provisions are tied to a commodity market index, with certain adjustments based on, among other factors, whether a well delivers to a gathering or transmission line, quality of the oil or natural gas, and prevailing supply and demand conditions. As a result, the price of the oil, natural gas and NGLs fluctuates to remain competitive with the other available oil, natural gas and NGL supplies.

Oil Sales

Under the Company’s crude purchase and marketing contracts, the Company generally sells oil production at the wellhead and collects an agreed-upon index price, net of pricing differentials. In this scenario, the Company recognizes revenue when control transfers to the purchaser at the wellhead at the net price received.

To account for producer imbalances, the Company recognizes revenue on all sales to third party customers regardless of their ownership percentage and adjusts the underlifter or overlifter’s claim on the asset’s remaining reserves. As of December 31, 2020, the Company had an oil imbalance of 1.1 MBbl, which the Company intends to settle with the counterparty in crude oil barrels.

Natural Gas and NGL Sales

Under the Company’s natural gas processing contracts, the Company delivers natural gas to a midstream processing entity at the wellhead or the inlet of the midstream processing entity’s system. The midstream processing entity gathers and processes the natural gas and remits proceeds to the Company for the resulting sales of NGLs and residue gas. In these scenarios, we evaluate whether we are the principal or the agent in the transaction, and the point at which control of the hydrocarbons transfers to the customer. For those contracts where the Company has concluded the midstream processing entity is the Company’s agent and the third-party end user is its customer (generally the Company’s fixed-fee gathering and processing agreements), the Company recognizes revenue on a gross basis, with transportation and gathering expense presented as an operating expense in the consolidated statements of operations. Alternatively, for those contracts where the Company has concluded the midstream processing entity is its customer and controls the hydrocarbons (generally the Company’s percentage of proceeds gathering and processing agreements), the Company recognizes natural gas and NGL revenues based on the net amount of the proceeds received from the midstream processing company.

In certain natural gas processing agreements, the Company may elect to take its residue gas and/or NGLs in-kind at the tailgate of the midstream entity’s processing plant and subsequently market the product. Through the marketing process, the Company delivers product to the third-party purchaser at a contractually agreed-upon delivery point and receives a specified index price from the purchaser. In this scenario, the Company recognizes revenue when the control transfers to the purchaser at the delivery point based on the index price received from the purchaser. The gathering and processing expense attributable to the gas processing contracts, as well as any transportation expense incurred to deliver the product to the purchaser, are presented as transportation and gathering expense in the consolidated statements of operations.

Performance Obligations

A significant number of the Company’s product sales are short-term in nature with a contract term of one year or less. For those contracts, the Company has utilized the practical expedient in ASC 606-10-50-14 exempting the Company from disclosure of the transaction price of a contract that has an original expected duration of one year or less.

For the Company’s product sales that have a contract term greater than one year, the Company has utilized the practical expedient in ASC 606-10-50-14(a), which states the Company is not required to disclose the transaction price allocated to remaining performance obligations if the variable consideration is allocated entirely to a wholly unsatisfied performance obligation. Under these sales contracts, each unit of product generally represents a separate performance obligation; therefore future volumes are wholly unsatisfied and disclosure of the transaction price allocated to remaining performance obligations is not required.

The Company records revenue on its oil, natural gas and NGL sales at the time production is delivered to the purchaser. However, settlement statements for certain oil, natural gas and NGL sales may not be received for 30 to 90 days after the date production is delivered, and as a result, the Company is required to estimate the amount of production delivered to the customer and the net commodity price that will be received for the sale of these commodity products. The Company records the differences between the revenue estimated and the actual amounts received for product sales in the month that payment is received from the customer.

Contract Balances

The Company had a certain revenue contract with an initial term beginning on November 1, 2016 and continuing until October 31, 2020 after which the contract was to begin an automatic month-to-month renewal unless terminated by either party giving notice at least six months prior to the effective termination date but in no event could either party give such notice earlier than November 1, 2020. Based on the accounting treatment pursuant to ASC 606 — Revenue from Contracts with Customers, the contract term would end on April 30, 2021 because it could be terminated by either party with no penalty effective as of such date. The contract term impacted the amount of consideration that could be included in the transaction price. The Company recognizes revenue and invoices customers once its performance obligations have been satisfied. When it becomes probable that the Company will not meet its performance obligations, the transaction price allocated to the performance obligation is constrained in the amount of the estimated unmet performance obligation and recognized as a reduction to revenue in the period in which the transaction price changes. On June 12, 2020, the Company and the counterparty to the contract mutually cancelled the contract effective June 30, 2020. As a result of the cancellation, for the year ended December 31, 2020, $12.3 million was recorded as a reduction in the transaction price resulting from unsatisfied performance obligations in the period. For the year ended December 31, 2019, the Company allocated $24.7 million to a satisfied performance obligation recognized within oil sales under ASC 606. As a result of the contract termination, the Company incurred an early termination

fee of $13.2 million recorded in other operating expenses for the year ended December 31, 2020. This amount was settled during the third quarter of 2020, and there are no remaining amounts due to the counterparty.

The following table presents the Company’s revenues disaggregated by revenue source. Transportation and gathering costs in the following table are not all of the transportation and gathering expenses that the Company incurs, only the expenses that are netted against revenues pursuant to ASC 606.


	For the Year Ended December 31,
	2020		2019		2018
Revenues:
Oil sales	$	382,526	$	721,429	$	840,687
Natural gas sales	114,786		129,969		121,180
NGL sales	89,634		92,429		134,558
Gathering and compression	1,473		1,261		—
Transportation and gathering included in revenues	(30,515)		(38,453)		(35,682)
Total Revenues	$	557,904	$	906,635	$	1,060,743

There are no other accounting standards applicable to the Company that have been issued but not yet adopted by the Company as of December 31, 2020 and through the date of this filing that would have a material impact on the Company’s consolidated financial statements and related disclosures.

Oil and Gas Properties

12 Months Ended

Dec. 31, 2020

Extractive Industries [Abstract]

Oil and Gas Properties

The Company’s oil and gas properties are entirely within the United States. The net capitalized costs related to the Company’s oil and gas producing activities were as follows (in thousands):


	As of December 31,
	2020		2019
Proved oil and gas properties	$	4,743,463	$	4,530,934
Unproved oil and gas properties (1)	220,380		524,214
Wells in progress (2)	129,058		149,733
Total capitalized costs (3)	$	5,092,901	$	5,204,881
Accumulated depletion, depreciation, amortization and impairment charge (4)	$	(3,459,689)	(2,985,983)
Net capitalized costs	$	1,633,212	$	2,218,898

(1) Unproved oil and gas properties represent unevaluated costs the Company excludes from the amortization base until proved reserves are established or impairment is determined.

(2) Costs from wells in progress are excluded from the amortization base until production commences.

(3) Includes accumulated interest capitalized of $45.1 million and $39.8 million as of December 31, 2020 and 2019, respectively.

(4) For more information about proved oil and gas properties impairment, see Note 2 — Basis of Presentation and Significant Accounting Policies.

The following table presents information regarding the Company’s net costs incurred in oil and gas property acquisition, exploration and development activities (in thousands):


	For the Year Ended
	December 31,
	2020		2019
Property acquisition costs:
Proved	$	8,071	$	21,024
Unproved	8,970		35,207
Exploration costs (1)	—		3,569
Development costs	173,538		588,974
Total	$	190,579	$	648,774
Total excluding asset retirement costs	$	176,629	$	598,778

(1) Exploration costs do not include abandonment costs of unproved properties, which are included in the line item exploration and abandonment expenses in the consolidated statements of operations.

Acquisitions	12 Months Ended
Acquisitions	Dec. 31, 2020
Business Combinations [Abstract]
Acquisitions	Acquisitions and Divestitures February 2020 Divestiture In February 2020, the Company completed the sale of certain non-operated producing properties for aggregate sales proceeds of approximately $12.2 million, subject to customary purchase price adjustments. No gain or loss was recognized for the February 2020 Divestiture. The Company continues to explore divestitures, as part of our ongoing initiative to divest of non-strategic assets. December 2019 Divestiture In December 2019, the Company completed the sale of certain non-operated producing properties for aggregate sales proceeds of approximately $10.0 million, subject to customary purchase price adjustments. No gain or loss was recognized for the December 2019 Divestiture. August 2019 Divestiture In August 2019, the Company completed the sale of certain non-operated producing properties for aggregate sales proceeds of approximately $22.0 million, subject to customary purchase price adjustments. No gain or loss was recognized for the August 2019 Divestiture. March 2019 Divestiture In March 2019, the Company completed the sale of its interests in approximately 5,000 net acres of leasehold and producing properties for aggregate sales proceeds of approximately $22.4 million. The effective date for the March 2019 Divestiture was July 1, 2018 with purchase price adjustments calculated as of the closing date of $5.9 million, resulting in net proceeds of $16.5 million. No gain or loss was recognized for the March 2019 Divestiture. December 2018 Divestitures In December 2018, the Company completed various sales of its interests in approximately 31,200 net acres of leasehold and primarily non-producing properties, for aggregate sales proceeds of approximately $8.5 million, subject to customary purchase price adjustments, and recognized a loss of $6.1 million. August 2018 Divestiture In August 2018, Elevation received proceeds of $83.6 million and recognized a gain of $83.6 million for the year ended December 31, 2018, upon the sale of assets of DJ Holdings, LLC, a subsidiary of Discovery Midstream Partners, LP, of which Elevation held a 10% membership interest. The Company acquired its interest in exchange for the contribution of an acreage dedication, which is considered a nonfinancial asset. April 2018 Divestitures In April 2018, the Company completed various sales of its interests in approximately 15,100 net acres of leasehold and primarily non-producing properties for aggregate sales proceeds of approximately $72.3 million and recognized a gain of $59.3 million for the year ended December 31, 2018. April 2018 Acquisition In April 2018, the Company acquired an unaffiliated oil and gas company’s interest in approximately 1,000 net acres of non-producing leasehold primarily located in Arapahoe County, Colorado. Upon closing the seller received approximately $9.4 million in cash. This transaction has been accounted for as an asset acquisition. The acquisition provided new development opportunities in the Core DJ Basin. January 2018 Acquisition On January 8, 2018, the Company acquired an unaffiliated oil and gas company’s interest in approximately 1,200 net acres of non-producing leasehold located in Arapahoe County, Colorado. Upon closing the seller received approximately $11.6 million in cash. This transaction has been accounted for as an asset acquisition. The acquisition provided new development opportunities in the Core DJ Basin.

Liabilities Subject to Compromise

12 Months Ended

Dec. 31, 2020

Reorganizations [Abstract]

Liabilities Subject to Compromise

The Company’s liabilities subject to compromise consisted of the following (in thousands):


	December 31, 2020
Accounts payable and accrued liabilities	$	54,647
Revenue payable	59,848
Production taxes payable - current	151,971
Production taxes payable - non-current	22,405
Asset retirement obligations - current	14,304
Asset retirement obligations - non-current	80,465
Accrued interest on debt subject to compromise	31,676
2024 Senior Notes due May 15, 2024	400,000
2026 Senior Notes due February 1, 2026	700,189
Deferred liability	7,153
Damages for rejected and settled contracts	582,439
Elevation cash settlement	38,400
Total liabilities subject to compromise	$	2,143,497

As discussed in Note 1 — Business and Organization — Voluntary Reorganization under Chapter 11 of the Bankruptcy Code, since the Petition Date, the Company has been operating as debtor-in-possession under the jurisdiction of the Bankruptcy Court and in accordance with provisions of the Bankruptcy Code. On the accompanying consolidated balance sheets, the line item liabilities subject to compromise reflects the expected allowed amount of the prepetition claims that are not fully secured and that have at least a possibility of not being repaid at the full claim amount. Determination of the value at which liabilities will ultimately be settled was determined when the Bankruptcy Court approved the Plan on December 23, 2020. In addition, the manner by which those liabilities are settled was determined by the aforementioned Plan and will include settlement in cash, Successor Company New Common Stock or a combination. Liabilities subject to compromise includes amounts related to the rejection of various executory contracts and unexpired leases. The Company will continue to evaluate the amount and classification of its prepetition liabilities.

Reorganization Items, Net

The Company’s reorganization items, net consisted of the following (in thousands):


	For the Year Ending
	December 31, 2020
Professional fees	$	59,841
Professional services fees	2,200
Trustee fees	801
Damages for rejected and settled contracts	572,126
DIP Credit Facility fees	1,717
Write-off of debt issuance costs	13,541
Court approved vendor settlements	(2,602)
Backstop commitment premium	29,231
Total reorganization items, net	$	676,855

The Company has incurred and will continue to incur significant expenses, gains and losses associated with the reorganization, primarily adjustments for allowable claims related to executory contracts approved for rejection by the Bankruptcy Court, negotiated settlements on executory contracts, the write-off of unamortized debt issuance costs and professional fees incurred subsequent to the Chapter 11 filings for the restructuring process. The amount of these items, which are being incurred in reorganization items, net within the Company’s accompanying consolidated statements of operations, are expected to significantly affect the Company’s results of operations.

As of December 31, 2020, $633.6 million of reorganization costs, net consisting of professional fees, trustee fees, damages for rejected or settled contracts and backstop party premiums are accrued and unpaid and are presented in either accounts payable and accrued liabilities or liabilities subject to compromise on the consolidated balance sheets. The write-off of the Senior Notes debt issuance costs are included in reorganization items, net as the underlying debt instruments were impacted by the Chapter 11 Cases. The write-off of the Senior Notes debt issuance costs is a non-cash reorganization item. For the year ended December 31, 2020, the Company had cash charges related to reorganization items, net of $34.4 million.

Reorganizations Items, Net

12 Months Ended

Dec. 31, 2020

Reorganizations [Abstract]

Reorganization Items, Net

Liabilities Subject to Compromise

The Company’s liabilities subject to compromise consisted of the following (in thousands):


	December 31, 2020
Accounts payable and accrued liabilities	$	54,647
Revenue payable	59,848
Production taxes payable - current	151,971
Production taxes payable - non-current	22,405
Asset retirement obligations - current	14,304
Asset retirement obligations - non-current	80,465
Accrued interest on debt subject to compromise	31,676
2024 Senior Notes due May 15, 2024	400,000
2026 Senior Notes due February 1, 2026	700,189
Deferred liability	7,153
Damages for rejected and settled contracts	582,439
Elevation cash settlement	38,400
Total liabilities subject to compromise	$	2,143,497

Reorganization Items, Net

The Company’s reorganization items, net consisted of the following (in thousands):


	For the Year Ending
	December 31, 2020
Professional fees	$	59,841
Professional services fees	2,200
Trustee fees	801
Damages for rejected and settled contracts	572,126
DIP Credit Facility fees	1,717
Write-off of debt issuance costs	13,541
Court approved vendor settlements	(2,602)
Backstop commitment premium	29,231
Total reorganization items, net	$	676,855

Leases

12 Months Ended

Dec. 31, 2020

Leases [Abstract]

Leases

The Company accounts for leases in accordance with ASC 842, Leases, which it adopted on January 1, 2019, applying the modified retrospective transition approach as of the effective date of adoption (see Note 2 — Basis of Presentation and Significant Accounting Policies — Recent Accounting Pronouncements for impacts of adoption).

The Company enters into operating leases for certain drilling equipment, completions equipment, equipment ancillary to drilling and completions, office facilities, compressors and office equipment. Under ASC 842, a contract is or contains a lease when (i) the contract contains an explicitly or implicitly identified asset and (ii) the customer obtains substantially all of the economic benefits from the use of that underlying asset and directs how and for what purpose the asset is used during the term of the contract in exchange for consideration. The Company assesses whether an arrangement is or contains a lease at inception of the contract. All leases (operating leases), other than those that qualify for the short-term recognition exemption, are recognized as of the lease commencement date on the balance sheet as a liability for its obligation related to the lease and a corresponding asset representing its right to use the underlying asset over the period of use.

The Company’s leases have remaining terms up to four years. Certain of our lease agreements contain options to extend or early terminate the agreement. The lease term used to calculate the lease asset and liability at commencement includes options to extend or terminate the lease when it is reasonably certain that we will exercise that option. When determining whether it is reasonably certain that the Company will exercise an option at commencement, it considers various economic factors, including capital expenditure strategies, the nature, length, and underlying terms of the agreement, as well as the uncertainty of the condition of leased equipment at the end of the lease term. Based on these determinations, the Company generally determines that the exercise of renewal options would not be reasonably certain in determining the expected lease term for leases, other than certain operating compressor leases.

The discount rate used to calculate the present value of the future minimum lease payments is the rate implicit in the lease, when readily determinable. As the Company’s leases generally do not provide an implicit rate, the Company uses its incremental borrowing rate based on its Prior Credit Facility, which includes consideration of the nature, term, and geographic location of the leased asset.

Certain of the Company’s leases include variable lease payments, including payments that depend on an index or rate, as well as variable payments for items such as property taxes, insurance, maintenance, and other operating expenses associated with leased assets. Payments that vary based on an index or rate are included in the measurement of the Company’s lease assets and liabilities at the rate as of the commencement date. All other variable lease payments are excluded from the measurement of the Company’s lease assets and liabilities and are recognized in the period in which the obligation for those payments is incurred. The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants.

The Company has elected, for all classes of underlying assets, to not apply the balance sheet recognition requirements of ASC 842 to leases with a term of one year or less, and instead, recognize the lease payments in the consolidated statements of operations on a straight-line basis over the lease term. The Company has also made the election, for its certain drilling equipment, completions equipment, equipment ancillary to drilling and completions, compressors and office equipment classes of underlying assets, to account for lease and non-lease components in a contract as a single lease component.

For the year ended December 31, 2020, lease costs, which represent the straight-line lease expense of right-of-use (“ROU”) assets and short-term leases, were as follows (in thousands):


	For the Year Ended December 31,		For the Year Ended December 31,
	2020		2019
Lease Costs included in the Consolidated Balance Sheets
Proved oil and gas properties, including drilling, completions and ancillary equipment, and gathering systems and facilities (1)	$	69,104	$	259,737

Lease Costs included in the Consolidated Statements of Operations
Operating lease costs (2)	$	23,060	$	33,025
General and administrative expenses (3)	$	3,074	$	3,821
Total operating lease costs	$	26,134	$	36,846

Total lease costs	$	95,238	$	296,583

(1) Represents short-term lease capital expenditures related to drilling rigs, completions equipment and other equipment ancillary to the drilling and completion of wells.

(2) Includes $6.0 million and $8.8 million of lease costs accounted for under ASC 842 for the years ended December 31, 2020 and 2019, respectively.

(3) Includes $1.0 million and $1.4 million of lease costs accounted for under ASC 842 for the years ended December 31, 2020 and 2019, respectively.

Supplemental cash flow information related to operating leases for the years ended December 31, 2020 and 2019, was as follows (in thousands):


	For the Year Ended December 31,		For the Year Ended December 31,
	2020		2019
Cash paid for amounts included in the measurements of lease liabilities
Operating cash flows from operating leases	$	14,146	$	12,923
Right-of-use assets obtained in exchange for lease obligations
Operating leases	$	5,057	$	12,805

Supplemental balance sheet information related to operating leases were as follows (in thousands, except lease term and discount rate):


	2020 Classification	As of December 31, 2020			As of December 31, 2019
Operating Leases
Operating lease right-of-use assets	Other non-current assets	$	8,199		$	29,186

Operating lease obligation - short-term	Liabilities subject to compromise	4,279			17,388
Operating lease obligation - long-term	Liabilities subject to compromise	4,357			17,166
Total operating lease liabilities		$	8,636		$	34,554

Weighted Average Remaining Lease Term in Years
Operating leases		2.3			4.4
Weighted Average Discount Rate
Operating leases		4.5		%	4.2		%

Long Term Debt

12 Months Ended

Dec. 31, 2020

Debt Disclosure [Abstract]

Long-Term Debt

The Company’s long-term debt consisted of the following (in thousands):


	As of December 31,
	2020		2019
DIP Credit Facility	$	106,727	$	—
Prior Credit Facility due August 16, 2022 (or an earlier time as set forth in the credit facility)	453,747		470,000
2024 Senior Notes due May 15, 2024	400,000		400,000
2026 Senior Notes due February 1, 2026	700,189		700,189
Total principal	1,660,663		1,570,189
Unamortized debt issuance costs on Senior Notes (1)	—		(14,412)
Total debt, prior to reclassification to liabilities subject to compromise	1,660,663		1,555,777
Less amounts reclassified to liabilities subject to compromise (2)	(1,100,189)		—
Total debt not subject to compromise (3)	560,474		1,555,777
Less: current portion of long-term debt (4)	(560,474)		—
Total long-term debt, net of current portion	$	—	$	1,555,777

(1) As a result of the Chapter 11 Cases and the adoption of ASC 852, the Company wrote off all unamortized debt issuance cost balances to reorganization items, net in the consolidated statements of operations during the year ended December 31, 2020.

(2) Debt subject to compromise includes the principal balances of the Company’s Senior Notes, which are unsecured claims in the Chapter 11 Cases and where the payments are stayed.

(3) Debt not subject to compromise includes all borrowings outstanding under the Prior Credit Facility and DIP Credit Facility which are fully secured claims in the Chapter 11 Cases and are expected to be unimpaired.

(4) Due to uncertainties regarding the outcome of the Chapter 11 Cases, the Company has classified the borrowings outstanding under the Prior Credit Facility and DIP Credit Facility as current liabilities on the consolidated balance sheets as of December 31, 2020.

RBL Credit Facility

On the Emergence Date at emergence, pursuant to the terms of the Plan, the Successor Company entered into a $1.0 billion reserve-based credit agreement (“RBL Credit Agreement”) with Wells Fargo Bank, National Association (“RBL Credit Facility”) with an initial borrowing base of $500.0 million. The borrowing base will be redetermined semiannually on or around May 1 and November 1 of each year, with one interim “wildcard” redetermination available to each of the Company and the bank between scheduled redeterminations during any 12-month period. The next scheduled redetermination will be on or around May 1, 2021. The initial elected amount under the RBL Credit Facility is $500.0 million before giving effect to any outstanding letters of credit.

As of the date of this filing, the Company has drawn $253.7 million on the RBL Credit Facility. Total funds available for borrowing under the Company’s RBL Credit Facility, after giving effect to an aggregate of $0.5 million of undrawn letters of credit, were $245.8 million as of the date of this filing.

The RBL Credit Facility provides for a $50.0 million sublimit of the aggregate commitments that is available for the issuance of letters of credit. The RBL Credit Facility bears interest either at a rate equal to (a) LIBOR plus an applicable margin that varies from 3.00% to 4.00% per annum or (b) a base rate plus an applicable margin that varies from 2.00% to 3.00% per annum. The RBL Credit Facility matures on July 20, 2024. The grid below shows the base rate margin and eurodollar margin depending on the applicable borrowing base utilization percentage as of the date of this filing:

RBL Credit Facility Borrowing Base Utilization Grid


					Base Rate		Eurodollar		Commitment
Borrowing Base Utilization Percentage	Utilization				Margin		Margin		Fee Rate
Level 1	<25%				2.00	%	3.00	%	0.50	%
Level 2	≥	25%	<	50%	2.25	%	3.25	%	0.50	%
Level 3	≥	50%	<	75%	2.50	%	3.50	%	0.50	%
Level 4	≥	75%	<	90%	2.75	%	3.75	%	0.50	%
Level 5	≥90%				3.00	%	4.00	%	0.50	%

The RBL Credit Facility requires the Company to maintain (i) a consolidated net leverage ratio of less than or equal to 3.00 to 1.00 and (ii) a consolidated current ratio of greater than or equal to 1.00 to 1.00.

The Company is required to pay a commitment fee of 0.50% per annum on the actual daily unused portion of the current aggregate commitments under the RBL Credit Facility. The Company is also required to pay customary letter of credit and fronting fees.

The RBL Credit Agreement also contains customary affirmative and negative covenants, including, among other things, as to compliance with laws (including environmental laws and anti-corruption laws), delivery of quarterly and annual financial statements and borrowing base certificates, conduct of business, maintenance of property, maintenance of insurance, restrictions on the incurrence of liens, indebtedness, asset dispositions, restricted payments, and other customary covenants.

Additionally, the RBL Credit Agreement contains customary events of default and remedies for credit facilities of this nature. If the Company does not comply with the financial and other covenants in the RBL Credit Agreement, the lenders may, subject to customary cure rights, require immediate payment of all amounts outstanding under the RBL Credit Agreement and any outstanding unfunded commitments may be terminated.

Chapter 11 Cases and Effect of Automatic Stay

On June 14, 2020, the Company filed for relief under Chapter 11 of the Bankruptcy Code. The commencement of a voluntary proceeding in bankruptcy constituted an immediate event of default under the Predecessor Credit Agreement and the indentures governing the Company’s Senior Notes, resulting in the automatic and immediate acceleration of all of the Company’s outstanding debt under the Predecessor Credit Agreement and Senior Notes. In conjunction with the filing of the Chapter 11 Cases, the Company did not make the $14.8 million interest payment on the Company’s 2024 Senior Notes (as defined below) due on May 15, 2020.

Debtor-in-Possession Financing

On June 16, 2020, in connection with the filing of the Chapter 11 Cases, the Debtors entered into a debtor-in-possession credit agreement on the terms set forth in a Superpriority Senior Secured Debtor-in-Possession Credit Agreement (the “DIP Credit Agreement”), by and among the Company, as borrower, the Company’s subsidiaries party thereto, as guarantors, the lenders party thereto (the “DIP Lenders”), and Wells Fargo Bank, National Association, as DIP agent and issuing lender, pursuant to which, having been granted the approval of the Bankruptcy Court, the DIP Lenders agreed to provide the Company with a superpriority senior secured debtor-in-possession credit facility (as amended, the “DIP Credit Facility”) with loans in an aggregate principal amount not to exceed $50.0 million that, among other things, will be used to finance the ongoing general corporate needs of the Debtors during the course of the Chapter 11 Cases. In addition to the $50.0 million of incremental loans, the DIP Credit Facility included $75.0 million in Prior Credit Facility loans rolled over into the DIP Credit Facility during July 2020, for a total facility size of $125.0 million.

As is described above, $22.5 million rolled from the Prior Credit Facility to the DIP Credit Facility on June 16, 2020 and an additional $52.5 million rolled on July 20, 2020 upon the Bankruptcy Court’s authorization order (the “Final DIP Order”). On July 27, 2020, the Company drew an additional $20.0 million on the DIP Credit Facility leaving $15.0 million of availability on the facility. The DIP Credit Facility is classified as a current liability on the consolidated balance sheets as of December 31, 2020 as it is fully secured and expected to be unimpaired. As of December 31, 2020, the Company’s DIP Credit Facility borrowings were $35.0 million and $75.0 million had been rolled over from the Prior Credit Facility. As of December 31, 2020, the Company had a undrawn standby letters of credit of $3.5 million under the DIP Credit Facility, which reduced the availability of the undrawn borrowing base. As of December 31, 2020, the total outstanding balance under the DIP Credit Facility was $106.7 million due to land sale proceeds during the fourth quarter that were required to reduce the DIP Credit Facility per the DIP Credit Agreement.

The annualized, weighted average interest rate for the DIP Credit Facility for the year ending December 31, 2020 was approximately 6.75%.

Upon emergence from bankruptcy on the Emergence Date, the DIP Credit Agreement was terminated and the holders of claims under the DIP Credit Agreement received payment in full, in cash, for allowed claims. Also on this date all liens and security interests granted to secure such obligations were automatically terminated and are of no further force and effect.

Predecessor Credit Agreement

As described in Note 1 — Business and Organization — Plan, Disclosure Statement, and Backstop Commitment Agreement, the Company entered into the Predecessor Credit Agreement and subsequent amendments thereto (“Prior Credit Facility”). The acceleration of the obligations under the Predecessor Credit Agreement as of June 14, 2020 resulted in a cross-default and acceleration of the maturity of the Company’s other outstanding long-term debt. As of December 31, 2020, the Prior Credit Facility had a drawn balance of $453.7 million classified as a current liability on the consolidated balance sheet as it was fully secured and unimpaired. Because this debt was fully secured, adequate protection payments paid throughout 2020 were classified as interest expense and not a reduction of principal. As is described in the Debtor-in-Possession Financing section above, $22.5 million rolled from the Prior Credit Facility to the DIP Credit Facility on June 16, 2020 and an additional $52.5 million rolled on July 20, 2020 upon court approval of the Final DIP Order. During the third quarter, due to the cancellation of a certain revenue contract discussed in Note 2 — Basis of Presentation, Significant Accounting Policies and Recent Accounting Pronouncements — Contract Balances, $24.3 million was drawn on a $40.0 million letter of credit secured by the Company’s Prior Credit Facility. As of December 31, 2020 and 2019, the Company had standby letters of credit of $9.4 million and $49.5 million, respectively, which reduced the availability of the undrawn borrowing base. As of the date of this filing, and excluding any undrawn amounts under letters of credit, the available amount to be borrowed under the Prior Credit Facility was zero. As of the date of this filing, the Company had no borrowings outstanding under the Prior Credit Facility due to the Company’s emergence from bankruptcy described below.

Interest was paid on the Prior Credit Facility throughout 2020 because adequate protection was granted by the Bankruptcy Court to holders of the Prior Credit Facility in the form of interest payments. The adequate protection payments were classified as interest expense and not reduction of principal given that the debt was considered fully secured, and the Bankruptcy Court did not take any action to recharacterize the adequate protection payments as principal reduction. The weighted average interest rate for the Prior Credit Facility for the years ending December 31, 2020 and 2019 was 5.0% and 4.8%, respectively.

Upon emergence from bankruptcy on the Emergence Date, the Predecessor Credit Agreement was terminated and the holders of claims under the Predecessor Credit Agreement each received its ratable portion of the Predecessor Credit Agreement for its allowed claims. Also on this date all liens and security interests granted to secure such obligations were automatically terminated and are of no further force and effect.

2021 Senior Notes

In July 2016, the Company issued at par $550.0 million principal amount of 7.875% Senior Notes due July 15, 2021 (the “2021 Senior Notes” and the offering, the “2021 Senior Notes Offering”). The 2021 Senior Notes bore an annual interest rate of 7.875%. The interest on the 2021 Senior Notes was payable on January 15 and July 15 of each year commencing on January 15, 2017. The Company received net proceeds of approximately $537.2 million after deducting discounts and fees.

Concurrent with the 2026 Senior Notes Offering (as defined below), the Company commenced a cash tender offer to purchase any and all of its 2021 Senior Notes (the “Tender Offer”). On January 24, 2018, the Company received approximately $500.6 million aggregate principal amount of the 2021 Senior Notes which were validly tendered (and not validly withdrawn). As a result, on January 25, 2018 the Company made a cash payment of approximately $534.2 million, which includes principal of approximately $500.6 million, a make-whole premium of approximately $32.6 million and accrued and unpaid interest of approximately $1.0 million.

On February 17, 2018, the Company redeemed approximately $49.4 million aggregate principal amount of the 2021 Senior Notes that remained outstanding after the Tender Offer and made a cash payment of approximately $52.7 million to the remaining holders of the 2021 Senior Notes, which included a make-whole premium of $3.0 million and accrued and unpaid interest of approximately $0.3 million.

2024 Senior Notes

In August 2017, the Company issued at par $400.0 million principal amount of 7.375% Senior Notes due May 15, 2024 (the “2024 Senior Notes” and the offering, the “2024 Senior Notes Offering”). The 2024 Senior Notes bore an annual interest rate of 7.375%. The interest on the 2024 Senior Notes was payable on May 15 and November 15 of each year which commenced on November 15, 2017. The Company received net proceeds of approximately $392.6 million after deducting fees.

The Company’s 2024 Senior Notes were its senior unsecured obligations and ranked equally in right of payment with all of its other senior indebtedness and senior to any of its subordinated indebtedness. The Company’s 2024 Senior Notes were fully and unconditionally guaranteed on a senior unsecured basis by certain of the Company’s current subsidiaries and by

certain future restricted subsidiaries that guarantees its indebtedness under a Prior Credit Facility (the “2024 Senior Notes Guarantors”). The 2024 Senior Notes were effectively subordinated to all of the Company’s secured indebtedness (including all borrowings and other obligations under its Prior Credit Facility) to the extent of the value of the collateral securing such indebtedness, and structurally subordinated in right of payment to all existing and future indebtedness and other liabilities (including trade payables) of any of its future subsidiaries that did not guarantee the 2024 Senior Notes.

The 2024 Senior Notes also contained affirmative and negative covenants that, among other things, limited the Company’s and the 2024 Senior Notes Guarantors’ ability to make investments; declare or pay any dividend or make any other payment to holders of the Company’s or any of its 2024 Senior Notes Guarantors’ equity interests; repurchase or redeem any equity interests of the Company; repurchase or redeem subordinated indebtedness; incur additional indebtedness or issue preferred stock; create liens; sell assets; enter into agreements that restrict dividends or other payments by restricted subsidiaries; consolidate, merge or transfer all or substantially all of the assets of the Company; engage in transactions with the Company’s affiliates; engage in any business other than the oil and gas business; and create unrestricted subsidiaries. The indenture governing the 2024 Senior Notes also contained customary events of default. Upon the occurrence of events of default arising from certain events of bankruptcy or insolvency, the 2024 Senior Notes would have become due and payable immediately without any declaration or other act of the trustee or the holders of the 2024 Senior Notes. Upon the occurrence of certain other events of default, the trustee or the holders of at least 25% in aggregate principal amount of the then outstanding 2024 Senior Notes could declare all outstanding 2024 Senior Notes to be due and payable immediately.

The filing of the Chapter 11 Cases resulted in an event of default under and acceleration of the maturity of the Company’s 2024 Senior Notes.

On January 20, 2021, upon emergence from bankruptcy, the 2024 Senior Notes were cancelled. The holders of the 2024 Senior Notes received (i) their proportionate distribution of the New Common Stock and (ii) the right to participate in the Equity Rights Offering.

2026 Senior Notes

In January 2018, the Company issued at par $750.0 million principal amount of 5.625% Senior Notes due February 1, 2026 (the “2026 Senior Notes” and together with the 2024 Senior Notes, the “Senior Notes” and the offering, the offering of the 2026 Senior Notes, “2026 Senior Notes Offering”). The 2026 Senior Notes bore an annual interest rate of 5.625%. The interest on the 2026 Senior Notes was payable on February 1 and August 1 of each year commencing on August 1, 2018. The Company received net proceeds of approximately $737.9 million after deducting fees. The Company used $534.2 million of the net proceeds from the 2026 Senior Notes Offering to fund the tender offer for its 2021 Senior Notes, $52.7 million to redeem any 2021 Senior Notes not tendered and the remainder for general corporate purposes.

The Company’s 2026 Senior Notes were the Company’s senior unsecured obligations and ranked equally in right of payment with all of the Company’s other senior indebtedness and senior to any of the Company’s subordinated indebtedness. The Company’s 2026 Senior Notes were fully and unconditionally guaranteed on a senior unsecured basis by certain of the Company’s current subsidiaries and by certain future restricted subsidiaries that guarantee the Company’s indebtedness under a Prior Credit Facility (the “2026 Senior Notes Guarantors”). The 2026 Senior Notes were effectively subordinated to all of the Company’s secured indebtedness (including all borrowings and other obligations under its Prior Credit Facility) to the extent of the value of the collateral securing such indebtedness, and structurally subordinated in right of payment to all existing and future indebtedness and other liabilities (including trade payables) of certain of the Company’s future restricted subsidiaries that do not guarantee the 2026 Senior Notes.

The 2026 Senior Notes also contained affirmative and negative covenants that, among other things, limited the Company’s and the 2026 Senior Notes Guarantors’ ability to make investments; declare or pay any dividend or make any other payment to holders of the Company’s or any of its 2026 Senior Notes Guarantors’ equity interests; repurchase or redeem any equity interests of the Company; repurchase or redeem subordinated indebtedness; incur additional indebtedness or issue preferred stock; create liens; sell assets; enter into agreements that restrict dividends or other payments by restricted subsidiaries; consolidate, merge or transfer all or substantially all of the assets of the Company; engage in transactions with the Company’s affiliates; engage in any business other than the oil and gas business; and create unrestricted subsidiaries. The indenture governing the 2026 Senior Notes also contained customary events of default. Upon the occurrence of events of default arising from certain events of bankruptcy or insolvency, the 2026 Senior Notes would have become due and payable immediately without any declaration or other act of the trustee or the holders of the 2026 Senior Notes. Upon the occurrence of certain other events of default, the trustee or the holders of at least 25% in aggregate principal amount of the then outstanding 2026 Senior Notes could declare all outstanding 2026 Senior Notes to be due and payable immediately.

The filing of the Chapter 11 Cases resulted in an event of default under and acceleration of the maturity of the Company’s 2026 Senior Notes.

On January 20, 2021, upon emergence from bankruptcy, the 2026 Senior Notes were cancelled. The holders of the 2026 Senior Notes received (i) their proportionate distribution of the New Common Stock and (ii) the right to participate in the Equity Rights Offering.

Debt Issuance Costs

Debt issuance costs include origination, legal and other fees incurred in connection with the Company’s Prior Credit Facility and Senior Notes. As of December 31, 2020 and 2019, the Company had debt issuance costs, net of accumulated amortization, of $0.1 million and $2.9 million, respectively, related to its Prior Credit Facility which has been reflected on the Company’s consolidated balance sheet within the line item other non-current assets. As a result of bankruptcy, the Company wrote-off $13.5 million in unamortized debt issuance costs on the Senior Notes to reorganization items, net in the consolidated statements of operations. As of December 31, 2019, the Company had debt issuance costs net of accumulated amortization of $14.4 million related to its Senior Notes, which have been reflected on the Company’s consolidated balance sheets within the line item Senior Notes, net of unamortized debt issuance costs. For the year ended December 31, 2020, 2019 and 2018, the Company recorded amortization expense related to the debt issuance costs $3.7 million, $5.5 million and $13.2 million, respectively.

Debt issuance costs of $1.7 million pertaining to the DIP Credit Facility were expensed to reorganization items, net during the year ended December 31, 2020.

Interest Incurred on Long-Term Debt

As discussed in Note 2 — Basis of Presentation — Automatic Stay, during the proceedings of the Chapter 11 Cases, interest on the Senior Notes ceased being accrued and paid during 2020. However, interest was incurred, accrued and paid on the Prior Credit Facility due to the adequate protections obtained for this facility. Interest was incurred, accrued and paid on the DIP Credit Facility as it was obtained post-petition and approved by the Bankruptcy Court. For the years ended December 31, 2020, 2019 and 2018, the Company incurred interest expense on debt of $58.8 million, $91.5 million and $82.7 million, respectively, and the Company capitalized interest expense on debt of $5.3 million, $7.2 million and $8.2 million, respectively, for the years ended December 31, 2020, 2019 and 2018, which has been reflected in the Company’s consolidated financial statements. Also included in interest expense for the year ended December 31, 2018 was a make-whole premium of $35.6 million related to the Company’s repayment of its 2021 Senior Notes in January and February 2018.

Senior Note Repurchase Program

In January 2019, the Company’s board of directors (the “Board”) authorized a program to repurchase up to $100.0 million of the Company’s Senior Notes (the “Senior Notes Repurchase Program”). The Company’s Senior Notes Repurchase Program was subject to restrictions under the Prior Credit Facility and did not obligate it to acquire any specific nominal amount of Senior Notes. During 2020, the Company did not repurchase any Senior Notes. As a result of the Chapter 11 Cases, the authorization to repurchase Senior Notes is no longer applicable. During 2019, the Company repurchased 2026 Senior Notes with a nominal value of $49.8 million for $39.3 million in connection with the Senior Notes Repurchase Program.

Commodity Derivative Instruments

12 Months Ended

Dec. 31, 2020

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Commodity Derivative Instruments

The Company has entered into commodity derivative instruments, as described below. The Company has utilized swaps, put options and call options to reduce the effect of price changes on a portion of the Company’s future oil and natural gas production.

The Company combines swaps, purchased put options, purchased call options, sold put options and sold call options in order to achieve various hedging strategies. Some examples of the Company’s hedging strategies are collars which include purchased put options and sold call options, three-way collars which include purchased put options, sold put options and sold call options, and enhanced swaps, which include either sold put options or sold call options with the associated premiums rolled into an enhanced fixed price swap. The Company has historically relied on commodity derivative contracts to mitigate its exposure to lower commodity prices.

The objective of the Company’s use of commodity derivative instruments is to achieve more predictable cash flows in an environment of volatile oil and natural gas prices and to manage its exposure to commodity price risk. While the use of these commodity derivative instruments limits the downside risk of adverse price movements, such use may also limit the Company’s ability to benefit from favorable price movements. The Company may, from time to time, add incremental derivatives to hedge additional production, restructure existing derivative contracts or enter into new transactions to modify the terms of current contracts in order to realize the current value of the Company’s existing positions. The Company does not enter into derivative contracts for speculative purposes.

To reduce the impact of fluctuations in oil and natural gas prices on the Company’s revenues, the Company has periodically entered into commodity derivative contracts with respect to certain of its oil and natural gas production through various transactions that limit the downside of future prices received. Future transactions may include price swaps whereby the Company will receive a fixed price for its production and pay a variable market price to the contract counterparty. Additionally, the Company may enter into collars, whereby it receives the excess, if any, of the fixed floor over the floating rate or pay the excess, if any, of the floating rate over the fixed ceiling price. These hedging activities are intended to support oil and natural gas prices at targeted levels and to manage the Company’s exposure to oil and natural gas price fluctuations.

The use of derivatives involves the risk that the counterparties to such instruments will be unable to meet the financial terms of such contracts. The Company’s derivative contracts are currently with two counterparties, both of which are lenders under the Predecessor Credit Agreement and the DIP Credit Facility. The Company has netting arrangements with the counterparties that provide for the offset of payables against receivables from separate derivative arrangements with the counterparties in the event of contract termination. The derivative contracts may be terminated by a non-defaulting party in the event of default by one of the parties to the agreement. There are no credit risk related contingent features or circumstances in which the features could be triggered in derivative instruments that are in a net liability position at the end of the reporting period.

Effect of Chapter 11 Cases

The commencement of the Chapter 11 Cases constituted a termination event with respect to the Company’s derivative instruments, which permitted the counterparties to such derivative instruments to terminate their outstanding hedges. Such termination events were not stayed under the Bankruptcy Code. During June 2020, certain of the lenders under the Predecessor Credit Agreement elected to terminate their International Swaps and Derivatives Association master agreements and outstanding hedges with the Company for aggregate settlement proceeds of $96.1 million. The proceeds from these terminations were applied to the outstanding borrowings under the Prior Credit Facility.

The Company’s open commodity derivative contracts as of December 31, 2020 are summarized below:


	2021
NYMEX WTI Crude Swaps:
Notional volume (Bbl)	2,629,700
Weighted average fixed price ($/Bbl)	$	50.40

The following tables detail the fair value of the Company’s derivative instruments, including the gross amounts and adjustments made to net the derivative instruments for the presentation in the consolidated balance sheets (in thousands):


	As of December 31, 2020
Location on Balance Sheet	Gross Amounts of Recognized Assets and Liabilities		Gross Amounts Offset in the Balance Sheet (1)		Net Amounts of Assets and Liabilities Presented in the Balance Sheet		Gross Amounts not Offset in the Balance Sheet (2)		Net Amounts (3)
Current assets	$	8,372	$	(1,401)	$	6,971	$	—	$	6,971
Non-current assets	—		—		—		—		—
Current liabilities	(3,548)		1,401		(2,147)		—		(2,147)
Non-current liabilities	—		—		—		—		—

	As of December 31, 2019
Location on Balance Sheet	Gross Amounts of Recognized Assets and Liabilities		Gross Amounts Offset in the Balance Sheet (1)		Net Amounts of Assets and Liabilities Presented in the Balance Sheet		Gross Amounts not Offset in the Balance Sheet (2)		Net Amounts (3)
Current assets	$	48,605	$	(31,051)	$	17,554	$	—	$	30,783
Non-current assets	38,034		(24,805)		13,229		—		—
Current liabilities	(33,049)		31,051		(1,998)		—		(2,106)
Non-current liabilities	(24,913)		24,805		(108)		—		—

(1) Agreements are in place that allow for the financial right of offset for derivative assets and derivative liabilities at settlement or in the event of a default under the agreements.
(2) Netting for balance sheet presentation is performed by current and non-current classification. This adjustment represents amounts subject to an enforceable master netting arrangement, which are not netted on the consolidated balance sheets. There are no amounts of related financial collateral received or pledged.
(3) Net amounts are not split by current and non-current. All counterparties in a net asset position are shown in the current asset line item, and all counterparties in a net liability position are shown in the current liability line item.

The table below sets forth the commodity derivatives gain (loss) for the years ended December 31, 2020, 2019 and 2018 (in thousands) included in the other income (expense) section of the consolidated statements of operations.


	For the Year Ended December 31,
	2020		2019		2018
Commodity derivatives gain (loss)	$	164,968	$	(37,107)	$	(8,554)

Asset Retirement Obligations

12 Months Ended

Dec. 31, 2020

Asset Retirement Obligation Disclosure [Abstract]

Asset Retirement Obligations

The Company follows accounting for asset retirement obligations in accordance with ASC 410, Asset Retirement and Environmental Obligations, which requires that the fair value of a liability for an asset retirement obligation be recognized in the period in which it was incurred if a reasonable estimate of fair value could be made. The Company’s asset retirement obligations primarily represent the estimated present value of the amounts expected to be incurred to plug, abandon and remediate producing and shut-in wells at the end of their productive lives in accordance with applicable local, state and federal laws, and applicable lease terms. The Company determines the estimated fair value of its asset retirement obligations by calculating the present value of estimated cash flows related to plugging and abandonment liabilities. The significant inputs used to calculate such liabilities include estimates of costs to be incurred; the Company’s credit adjusted discount rates, inflation rates and estimated dates of abandonment. The asset retirement liability is accreted to its present value each period and the capitalized asset retirement costs are depleted with proved oil and gas properties using the unit of production method. Asset retirement obligations are currently presented in the line item liabilities subject to compromise on the consolidated balance sheets.

The following table summarizes the activities of the Company’s asset retirement obligations for the periods indicated (in thousands):


	For the Year Ended
	December 31,
	2020		2019
Balance beginning of period	$	95,908	$	69,791
Liabilities incurred or acquired	$	333	$	978
Liabilities settled	$	(21,533)	$	(29,305)
Revisions in estimated cash flows (1)	$	13,617	$	49,050
Accretion expense	$	6,444	$	5,394
Balance end of period	$	94,769	$	95,908

(1) Revisions in estimated cash flows during the year ended December 31, 2020 and 2019 were primarily due to changes in estimates of costs to be incurred to plug and abandon wells and changes in estimated dates of abandonment.

Fair Value Measurements

12 Months Ended

Dec. 31, 2020

Fair Value Disclosures [Abstract]

Fair Value Measurements

ASC 820, Fair Value Measurement and Disclosure, establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs that market participants would use in pricing the asset or liability developed based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company’s assumptions of what market participants would use in pricing the asset or liability developed based on the best information available in the circumstances. The hierarchy is broken down into three levels based on the reliability of the inputs as follows:

•Level 1: Quoted prices are available in active markets for identical assets or liabilities;

•Level 2: Quoted prices in active markets for similar assets and liabilities that are observable for the asset or liability;

•Level 3: Unobservable pricing inputs that are generally less observable from objective sources, such as discounted cash flow models or valuations.

The financial assets and liabilities are classified based on the lowest level of input that is significant to the fair value measurement. The Company’s assessment of the significance of a particular input to the fair value measurement requires judgment, and may affect the valuation of the fair value of assets and liabilities and their placement within the fair value hierarchy levels. There were no transfers between levels during any periods presented below.

The following table presents the Company’s financial assets and liabilities that were accounted for at fair value on a recurring basis as of December 31, 2020 and 2019 by level within the fair value hierarchy (in thousands):


	Fair Value Measurement at
	December 31, 2020
	Level 1		Level 2		Level 3		Total
Financial Assets:
Commodity derivative assets	$	—	$	6,971	$	—	$	6,971
Financial Liabilities:
Commodity derivative liabilities	$	—	$	2,147	$	—	$	2,147


	Fair Value Measurement at
	December 31, 2019
	Level 1		Level 2		Level 3		Total
Financial Assets:
Commodity derivative assets	$	—	$	30,783	$	—	$	30,783
Financial Liabilities:
Commodity derivative liabilities	$	—	$	2,106	$	—	$	2,106

The following methods and assumptions were used to estimate the fair value of the assets and liabilities in the tables above:

Commodity Derivative Instruments

The Company determines its estimate of the fair value of derivative instruments using a market based approach that takes into account several factors, including quoted market prices in active markets, implied market volatility factors, quotes from third parties, the credit rating of each counterparty, and the Company’s own credit rating. In consideration of counterparty credit risk, the Company assessed the possibility of whether each counterparty to the derivative would default by failing to make any contractually required payments. Additionally, the Company considers that it is of substantial credit quality and has the financial resources and willingness to meet its potential repayment obligations associated with the derivative transactions. Derivative instruments utilized by the Company consist of swaps, put options, and call options. The oil and natural gas derivative markets are highly active. Although the Company’s derivative instruments are valued using public indices, the instruments themselves are traded with third-party counterparties and are not openly traded on an exchange. As such, the Company has classified these instruments as Level 2.

Fair Value of Financial Instruments

The Company’s financial instruments consist primarily of cash and cash equivalents, accounts receivable, accounts payable, commodity derivative instruments (discussed above) and long-term debt. The carrying values of cash and cash equivalents, accounts receivable and accounts payable are representative of their fair values due to their short-term maturities. The carrying amount of the Company’s Prior Credit Facility and DIP Credit Facility approximated fair value as it bears interest at variable rates over the term of the loan. The fair values of the 2024 Senior Notes and 2026 Senior Notes were derived from available market data. As such, the Company has classified the 2024 Senior Notes and 2026 Senior Notes as Level 2. Please refer to Note 8 — Long-Term Debt for further information. The Company’s policy is to recognize transfers between levels at the end of the period. The table below (in thousands) does not impact the Company’s financial position, results of operations or cash flows.


	At December 31, 2020				At December 31, 2019
	Carrying Amount		Fair Value		Carrying Amount		Fair Value
Prior Credit Facility	$	453,747	$	453,747	$	470,000	$	470,000
DIP Credit Facility	106,727		106,727		—		—
2024 Senior Notes (1)	400,000		70,732		394,824		250,000
2026 Senior Notes (2)	700,189		123,408		690,953		420,113