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Long-Term Debt and Credit Agreements | 12 Months Ended
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Dec. 31, 2024
Debt Disclosure [Abstract] |
Long-Term Debt and Credit Agreements | Long-Term Debt and Credit Agreements The following table includes a summary of the Company’s long-term debt.
| December 31,
(In millions) | 2024 |  | 2023
Private placement senior notes: |  |  |
3.65% weighted-average private placement senior notes(1) | $ | 250 |  |  | $ | 825 |
Senior notes: |  |  |
3.90% senior notes due May 15, 2027 | 750 |  |  | 750 |
4.375% senior notes due March 15, 2029 | 500 |  |  | 500 |
5.60% senior notes due March 15, 2034 | 500 |  |  | — |
5.40% senior notes due February 15, 2035 | 750 |  |  | — |
5.90% senior notes due February 15, 2055 | 750 |  |  | — |
Total debt | 3,500 |  |  | 2,075 |
Unamortized debt premium | 69 |  |  | 90 |
Unamortized debt discount | (10) |  |  | — |
Unamortized debt issuance costs | (24) |  |  | (4) |
Total debt, net | 3,535 |  |  | 2,161 |
Less: current portion of long-term debt | — |  |  | 575 |
Long-term debt | $ | 3,535 |  |  | $ | 1,586 |
_______________________________________________________________________________ (1)The 3.65% weighted-average senior notes have bullet maturities, of which $575 million was repaid in September 2024 and $250 million will mature in September 2026. The remaining $250 million of the 3.65% weighted-average private placement senior notes bear interest at 3.77% per annum. Long-Term Debt Maturity As of December 31, 2024, maturities of long-term debt over the next five years were as follows:
(In millions) |
Year Ending December 31, |
2025 | $ | — |
2026 | 250
2027 | 750
2028 | — |
2029 | 500
Thereafter | 2,000 |
Total long-term debt | $ | 3,500 |
Private Placement Senior Notes The private placement senior notes are general, unsecured obligations of the Company. Interest on each series of private placement senior notes is payable semi-annually. Under the terms of the note purchase agreement, the Company may prepay all or any portion of the notes of each series on any date at a price equal to the principal amount thereof plus accrued and unpaid interest plus a make-whole premium. The note purchase agreement provides that the Company must maintain a minimum annual coverage ratio of consolidated cash flow to interest expense for the trailing four quarters of not less than 2.8 to 1.0 and requires the Company to maintain, as of the last day of any fiscal quarter, a maximum ratio of total debt to consolidated EBITDAX for the trailing four quarters of not more than 3.0 to 1.0. There are also various other covenants and events of default customarily found in such debt instrument. As of December 31, 2024, the Company was in compliance with its financial covenants under the private placement senior notes. Senior Notes The senior notes (the “Senior Notes”) are general, unsecured obligations of the Company. Interest on each series of Senior Notes is payable semi-annually. Under the terms of the indenture documents governing the Senior Notes, the Company may redeem all or any portion of the Senior Notes of each series on any date at a price equal to the principal amount thereof plus applicable redemption prices described in the governing indentures. The Company is also subject to various covenants and events of default customarily found in such debt instruments. In March 2024, the Company issued $500 million aggregate principal amount of 5.60% senior notes due 2034 (the “2034 Senior Notes”). The 2034 Senior Notes will mature on March 15, 2034 and were issued at a discount of $1 million. The Company incurred approximately $5 million of debt issuance costs that were capitalized and will be amortized over the term of such notes. In December 2024, the Company issued $750 million aggregate principal amount of 5.40% senior notes due 2035 (the “2035 Senior Notes”) and $750 million aggregate principal amount of 5.90% senior notes due 2055 (the “2055 Senior Notes”). The 2035 Senior Notes and the 2055 Senior Notes will mature on February 15, 2035 and February 15, 2055, respectively, and were issued at a discount of $3 million and $5 million, respectively. The Company incurred approximately $7 million and $8 million of debt issuance costs for the 2035 Senior Notes and 2055 Senior Notes, respectively, that were capitalized and will be amortized over the term of such notes. Term Loan In December 2024, the Company entered into a delayed draw term loan credit agreement with Toronto Dominion (Texas), LLC, as administrative agent, and certain other lenders and issuing banks (the “Term Loan”), which consists of a $500 million Tranche A Term Loan and a $500 million Tranche B Term Loan. The Tranche A Term Loan matures two years after funding, and the Tranche B Term Loan matures three years after funding. Borrowings under the Term Loan can be prepaid without penalty. As of December 31, 2024, the Company had no borrowings outstanding under the Term Loan and $1.0 billion of available commitments. Borrowings under the Term Loan bear interest at a rate per annum equal to, at the Company’s option, either a term secured overnight financing rate (“SOFR”) plus a 0.10 percent credit spread adjustment for all tenors or a base rate, plus an interest rate margin which ranges from 0 to 75 basis points for base rate loans, 100 to 175 basis points for Tranche A SOFR Term Loans and 112.5 to 187.5 basis points for Tranche B SOFR Term Loans based on the Company’s credit rating. The Company incurred $2 million of debt issuance costs which were capitalized and will be amortized over the terms of the Tranche A and Tranche B Term Loans. The Term Loan contains customary covenants, including the maintenance of a maximum leverage ratio of no more than 3.0 to 1.0 as of the last day of any fiscal quarter until such time as the Company has no other debt (other than the Company’s Credit Agreement as defined below) in a principal amount in excess of $75 million outstanding that has a financial maintenance covenant based on a leverage ratio, at which time the Term Loan requires maintenance of a ratio of total net debt to total capitalization of no more than 65 percent (with all calculations based on definitions contained in the Term Loan). Subsequent Event. In January 2025, the Company borrowed $500 million under the Tranche A Term Loan to partially fund the FME acquisition and borrowed $500 million under the Tranche B Term Loan to partially fund the Avant acquisition. Revolving Credit Agreement On September 12, 2024, the Company entered into an Amendment No. 1 (the “Amendment”) relating to its revolving credit agreement with JPMorgan Chase Bank, N.A., as administrative agent (the “Administrative Agent”), and certain lenders and issuing banks party thereto (as amended by the Amendment, and further amended, supplemented or otherwise modified from time-to-time, the “Credit Agreement”). The Amendment has increased the aggregate revolving commitments under the Credit Agreement from $1.5 billion to $2.0 billion, extended the Credit Agreement maturity date from March 10, 2028 to September 12, 2029, made certain amendments to the representations and warranties, affirmative and negative covenants and events of default, and made certain other modifications. The Company incurred $4 million of debt issuance costs related to the Amendment which were capitalized and will be amortized over the term of the amended Credit Agreement. Borrowings under the Credit Agreement bear interest at a rate per annum equal to, at the Company’s option, either a term SOFR plus a 0.10 percent credit spread adjustment for all tenors or a base rate, plus, in each case, an interest rate margin which ranges from 0 to 75 basis points for base rate loans and 100 to 175 basis points for term SOFR loans, based on the Company’s credit rating. The commitment fee on the unused available credit is calculated at annual rates ranging from 10 basis points to 25 basis points, based on the Company’s credit rating. The maturity date of the Credit Agreement can be extended for additional one-year periods on up to two occasions upon the agreement of the Company and lenders holding at least 50 percent of the commitments under the Credit Agreement. The Credit Agreement contains customary covenants, including the maintenance of a maximum leverage ratio of no more than 3.0 to 1.0 as of the last day of any fiscal quarter. At such time as the Company has no other debt in a principal amount in excess of $75 million outstanding that has a financial maintenance covenant based on a substantially similar leverage ratio, in lieu of such maximum leverage ratio covenant, the Credit Agreement will instead require the Company to maintain a ratio of total net debt to capitalization of no more than 65 percent (with all calculations based on definitions contained in the Credit Agreement). As of December 31, 2024, the Company had no borrowings outstanding under its revolving credit agreement and unused commitments of $2.0 billion.

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