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LEASES
 12 Months Ended
Dec. 31, 2024
Leases [Abstract]  
LEASES LEASES
Under the leasing standard that became effective January 1, 2019, there are two types of leases: finance and operating. Regardless of the type of lease, the initial measurement of the lease results in recording a ROU asset and a lease liability at the present value of the future lease payments.
Operating leases
The Company is currently a party to two operating lease agreements for the corporate office and transportation equipment. The remaining lease term for these agreements ranges from 47 to 65 months. In some cases, the lease contracts require the Company to make payments both for the use of the asset itself and for operations and maintenance services. Only the payments for the use of the asset related to the lease component are included in the calculation of ROU assets and lease liabilities. Payments for the operations and maintenance services are considered non-lease components and are not included in calculating the ROU assets and lease liabilities. For leases on ROU assets used in joint operations, generally the operator reflects the full amount of the lease component, including the amount that will be funded by the non-operators. As operator for the Etame Marin block, the ROU asset recorded for certain equipment used in the joint operations includes the gross amount of the lease components.
The transportation equipment leases include provisions for variable lease payments, under which the Company is required to make additional payments based on the number of days or hours the asset is deployed. Because the Company does not
know the extent that the Company will be required to make such payments, they are excluded from the calculation of ROU assets and lease liabilities.
Financing leases
The Company is currently a party to several financing lease agreements for the FSO and generators and marine vessels used in the operations of the Etame Marin block. The remaining lease term for these agreements ranges from 13 to 93 months. In some cases, the lease contracts require the Company to make payments both for the use of the asset itself and for operations and maintenance services. Only the payments for the use of the asset related to the lease component are included in the calculation of ROU assets and lease liabilities. Payments for the operations and maintenance services are considered non-lease components and are not included in calculating the ROU assets and lease liabilities.
All leases
For all leases that contain an option to extend the initial lease term, the Company has evaluated whether it is reasonably certain that the Company will extend the lease beyond the initial lease term. When the Company believes it is reasonably certain it will utilize these leased assets beyond the initial lease term, those payments have been included in the calculation of the ROU assets and liabilities. The discount rate used to calculate ROU assets and lease liabilities represents the Company’s incremental borrowing rate. The Company determined this by considering the term and economic environment of each lease, and estimating the resulting interest rate the Company would incur to borrow the lease payments.
For the years ended December 31, 2024, 2023 and 2022, the components of the lease costs and supplemental information was as follows:
Year Ended December 31,
202420232022
Lease cost:(in thousands)
Finance lease cost (1)
$19,198 $17,297 $3,682 
Operating lease cost5,100 1,403 11,040 
Short-term lease cost (2)
893 6,574 5,213 
Variable lease cost (3)
1 653 4,513 
Total lease expense25,192 25,927 24,448 
Lease costs capitalized— 55 4,127 
Total lease costs$25,192 $25,982 $28,575 
(1)Represents depreciation and interest associated with financing leases.
(2)Represents short term leases under contracts that are 1 year or less where a ROU asset and lease liability are not required to be recorded.
(3)Variable costs represent differences between minimum lease costs and actual lease costs incurred under lease contracts.
Other information:
Year Ended December 31,
202420232022
Other information:(in thousands)
Cash paid for amounts included in the measurement of lease liabilities:
Financing cash flows attributable to finance leases (in thousands)$10,477$7,161 $3,039 
Weighted-average remaining lease term (in years)7.368.169.65
Weighted-average discount rate7.16 %7.99 %4.59 %
Operating cash flows attributable to operating leases (in thousands)$2,127 $505 $19,300 
Weighted-average remaining lease term (in years)4.090.671.33
Weighted-average discount rate6.14 %8.45 %9.91 %
The table below describes the presentation of the total lease cost on the Company’s consolidated statements of operations and other comprehensive income (loss). As discussed above, the Company’s joint venture owners are required to reimburse the Company for their share of certain expenses, including certain lease costs.
Year Ended December 31,
202420232022
(in thousands)
Finance lease cost$11,290 $10,231 $2,188 
Production expense3,517 3,556 12,222 
General and administrative expense346 196 160 
Lease costs billed to the joint venture owners10,039 11,964 11,390 
Total lease expense25,192 25,947 25,960 
Lease costs capitalized— 35 2,615 
Total lease costs$25,192 $25,982 $28,575 
The following table describes the future maturities of the Company’s operating and financing lease liabilities at December 31, 2024:
Operating LeasesFinance Leases
Year(in thousands)
2025$4,368 $18,755 
20264,842 16,674 
20275,008 15,023 
20284,780 11,321 
2029520 11,315 
Thereafter220 28,925 
19,738 102,013 
Less: imputed interest2,323 21,253 
Total lease liabilities$17,415 $80,760 
Under the joint operating agreements, other joint venture owners are obligated to fund $49.2 million of the $121.8 million in future lease liabilities as of December 31, 2024.
LEASES LEASES
Under the leasing standard that became effective January 1, 2019, there are two types of leases: finance and operating. Regardless of the type of lease, the initial measurement of the lease results in recording a ROU asset and a lease liability at the present value of the future lease payments.
Operating leases
The Company is currently a party to two operating lease agreements for the corporate office and transportation equipment. The remaining lease term for these agreements ranges from 47 to 65 months. In some cases, the lease contracts require the Company to make payments both for the use of the asset itself and for operations and maintenance services. Only the payments for the use of the asset related to the lease component are included in the calculation of ROU assets and lease liabilities. Payments for the operations and maintenance services are considered non-lease components and are not included in calculating the ROU assets and lease liabilities. For leases on ROU assets used in joint operations, generally the operator reflects the full amount of the lease component, including the amount that will be funded by the non-operators. As operator for the Etame Marin block, the ROU asset recorded for certain equipment used in the joint operations includes the gross amount of the lease components.
The transportation equipment leases include provisions for variable lease payments, under which the Company is required to make additional payments based on the number of days or hours the asset is deployed. Because the Company does not
know the extent that the Company will be required to make such payments, they are excluded from the calculation of ROU assets and lease liabilities.
Financing leases
The Company is currently a party to several financing lease agreements for the FSO and generators and marine vessels used in the operations of the Etame Marin block. The remaining lease term for these agreements ranges from 13 to 93 months. In some cases, the lease contracts require the Company to make payments both for the use of the asset itself and for operations and maintenance services. Only the payments for the use of the asset related to the lease component are included in the calculation of ROU assets and lease liabilities. Payments for the operations and maintenance services are considered non-lease components and are not included in calculating the ROU assets and lease liabilities.
All leases
For all leases that contain an option to extend the initial lease term, the Company has evaluated whether it is reasonably certain that the Company will extend the lease beyond the initial lease term. When the Company believes it is reasonably certain it will utilize these leased assets beyond the initial lease term, those payments have been included in the calculation of the ROU assets and liabilities. The discount rate used to calculate ROU assets and lease liabilities represents the Company’s incremental borrowing rate. The Company determined this by considering the term and economic environment of each lease, and estimating the resulting interest rate the Company would incur to borrow the lease payments.
For the years ended December 31, 2024, 2023 and 2022, the components of the lease costs and supplemental information was as follows:
Year Ended December 31,
202420232022
Lease cost:(in thousands)
Finance lease cost (1)
$19,198 $17,297 $3,682 
Operating lease cost5,100 1,403 11,040 
Short-term lease cost (2)
893 6,574 5,213 
Variable lease cost (3)
1 653 4,513 
Total lease expense25,192 25,927 24,448 
Lease costs capitalized— 55 4,127 
Total lease costs$25,192 $25,982 $28,575 
(1)Represents depreciation and interest associated with financing leases.
(2)Represents short term leases under contracts that are 1 year or less where a ROU asset and lease liability are not required to be recorded.
(3)Variable costs represent differences between minimum lease costs and actual lease costs incurred under lease contracts.
Other information:
Year Ended December 31,
202420232022
Other information:(in thousands)
Cash paid for amounts included in the measurement of lease liabilities:
Financing cash flows attributable to finance leases (in thousands)$10,477$7,161 $3,039 
Weighted-average remaining lease term (in years)7.368.169.65
Weighted-average discount rate7.16 %7.99 %4.59 %
Operating cash flows attributable to operating leases (in thousands)$2,127 $505 $19,300 
Weighted-average remaining lease term (in years)4.090.671.33
Weighted-average discount rate6.14 %8.45 %9.91 %
The table below describes the presentation of the total lease cost on the Company’s consolidated statements of operations and other comprehensive income (loss). As discussed above, the Company’s joint venture owners are required to reimburse the Company for their share of certain expenses, including certain lease costs.
Year Ended December 31,
202420232022
(in thousands)
Finance lease cost$11,290 $10,231 $2,188 
Production expense3,517 3,556 12,222 
General and administrative expense346 196 160 
Lease costs billed to the joint venture owners10,039 11,964 11,390 
Total lease expense25,192 25,947 25,960 
Lease costs capitalized— 35 2,615 
Total lease costs$25,192 $25,982 $28,575 
The following table describes the future maturities of the Company’s operating and financing lease liabilities at December 31, 2024:
Operating LeasesFinance Leases
Year(in thousands)
2025$4,368 $18,755 
20264,842 16,674 
20275,008 15,023 
20284,780 11,321 
2029520 11,315 
Thereafter220 28,925 
19,738 102,013 
Less: imputed interest2,323 21,253 
Total lease liabilities$17,415 $80,760 
Under the joint operating agreements, other joint venture owners are obligated to fund $49.2 million of the $121.8 million in future lease liabilities as of December 31, 2024.