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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)
 6 Months Ended
Jun. 30, 2021
Accounting Policies [Abstract]  
Summary of Lease Cost Recognized
Lease costs recognized during the three months and six months ended June 30, 2021 were as follows:
Three Months Ended
June 30, 2021		Six Months Ended
June 30, 2021
(In thousands)
Operating lease cost included in general and administrative expense$435 $864 
Operating lease cost included in lease operating expense190 422 
Short-term lease cost (drilling rig costs included in proved oil and gas properties)7,659 19,243 
$8,284 $20,529 
Summary of Liabilities Under Contracts That Contain Operating Leases
As of June 30, 2021, expected future payments related to contracts that contain operating leases were as follows:
(In thousands)
July 1 to December 31, 2021$1,141 
20222,317 
20231,983 
20241,733 
20251 
Total lease payments
7,175 
Imputed interest(310)
Total lease liability$6,865 
Summary of Accrued Costs
Accrued costs at June 30, 2021 and December 31, 2020 consisted of the following:
As of
June 30,
2021
As of
December 31, 2020
(In thousands)
Accrued interest payable$30,549 $67,265 
Accrued capital expenditures25,744 24,959 
Accrued transportation costs24,379 25,353 
Accrued employee compensation7,562 7,519 
Accrued ad valorem taxes6,000 — 
Accrued income and other taxes5,661 2,168 
Accrued lease operating expenses2,354 3,466 
Other2,961 2,289 
$105,210 $133,019 
Summary of Changes in Total Estimated Asset Retirement Obligation Liability The following table summarizes the changes in Comstock's total estimated liability for such obligations during the periods presented:
Six Months Ended
June 30,
20212020
(In thousands)
Reserve for future abandonment costs at beginning of period$19,290 $18,151 
New wells placed on production
862 289 
Liabilities settled and assets disposed of
(6)(27)
Accretion expense
602 581 
Reserve for future abandonment costs at end of period$20,748 $18,994 
Schedule of Oil and Natural Gas Price Derivative The Company had the following oil and natural gas price derivative financial instruments at June 30, 2021:
Future Production Period
Six Months Ending December 31, 2021Year Ending December 31, 2022Year Ending December 31, 2023Total
Natural Gas Swap Contracts:
Volume (MMBtu)
105,340,000 (1)74,750,000 — 180,090,000 
Average Price per MMBtu
$2.53 (1)$2.75 — $2.62 
Natural Gas Collar Contracts:
Volume (MMBtu)
74,210,000 109,450,000 4,500,000 188,160,000 
Price per MMBtu:
Average Ceiling
$3.04 $3.44 $3.67 $3.29 
Average Floor
$2.47 $2.52 $2.50 $2.50 
Natural Gas Swaptions Contracts:
Volume (MMBtu)
— 43,800,000 (2)— 43,800,000 (2)
Average Price per MMBtu
— $2.51 (2)— $2.51 (2)
Natural Gas Basis Swap Contracts:
Volume (MMBtu)
7,360,000 (3)10,950,000 (3)— 18,310,000 (3)
Average Price per MMBtu($0.12)($0.16)— ($0.14)
Crude Oil Collar Contracts:
Volume (Bbls)
276,000 — — 276,000 
Price per Bbl:
Average Ceiling
$51.67 — — $51.67 
Average Floor
$41.67 — — $41.67 
_____________________________
(1)For the six months ending December 31, 2021, natural gas price swap contracts include 22,080,000 MMBtu at an average price of $2.51 that are part of certain natural gas price swaption contracts which include a call to extend the price swap by the counterparty as described in (2) below.
(2)The counterparty has the right to exercise a call option to enter into a price swap with the Company on 43,800,000 MMBtu in 2022 at an average price $2.51. The call option expires for 36,500,000 MMBtu at an average price of $2.52 in October 2021 and 7,300,000 MMBtu at an average price of $2.50 in November 2021.
(3)Contracts fix the differential between NYMEX Henry Hub and the Houston Ship Channel indices.
Schedule of Derivative Instruments The aggregate fair value of the Company's derivative instruments are presented on a gross basis in the accompanying consolidated balance sheets. The classification of derivative financial instruments between assets and liabilities, consists of the following:
TypeConsolidated Balance Sheet LocationJune 30,
2021		December 31, 2020
(in thousands)
Asset Derivative Financial Instruments:
Natural gas price derivativesDerivative Financial Instruments  – current$6,419 $8,913 
Oil price derivativesDerivative Financial Instruments  – current4,346 — 
$10,765 $8,913 
Natural gas price derivativesDerivative Financial Instruments  – long-term$798 $661 
Interest rate derivativesDerivative Financial Instruments  – long-term32 — 
$830 $661 
Liability Derivative Financial Instruments:
   Natural gas price derivativesDerivative Financial Instruments  – current$244,304 $45,158 
   Oil price derivativesDerivative Financial Instruments  – current9,828 831 
   Interest rate derivativesDerivative Financial Instruments  – current995 1,016 
$255,127 $47,005 
   Natural gas price derivativesDerivative Financial Instruments  – long-term$14,157 $1,308 
   Interest rate derivativesDerivative Financial Instruments – long-term— 1,056 
$14,157 $2,364 
Schedule of Gains and Losses from Derivative Contracts Gains and losses related to cash settlements and changes in the fair value recognized on the Company's derivative contracts recognized in the consolidated statement of operations were as follows:
Gain (Loss) on Derivatives
Recognized in Earnings		Three Months Ended June 30,Six Months Ended June 30,
2021202020212020
(In thousands)
Natural gas price derivatives$(219,845)$(5,140)$(238,722)$37,835 
Oil price derivatives(3,989)(4,406)(7,533)14,518 
Interest rate derivatives(124)(2,752)548 (2,752)
$(223,958)$(12,298)$(245,707)$49,601 
Consolidated Income Tax Benefit (Provision)
The following is an analysis of the consolidated income tax benefit (provision):
Three Months Ended
June 30,		Six Months Ended
June 30,
2021202020212020
(In thousands)
Current - State$(3,001)$(88)$(3,137)$(149)
Deferred - Federal58,044 13,520 92,963 2,017 
Deferred - State13,134 (1,987)8,318 (1,814)
$68,177 $11,445 $98,144 $54 
Difference Between Federal Statutory Rate and Effective Tax Rate The difference between the federal statutory rate of 21% and the effective tax rate is due to the following:
Three Months Ended
June 30,		Six Months Ended
June 30,
2021202020212020
Tax at statutory rate21.0 %21.0 %21.0 %21.0 %
Tax effect of:
Valuation allowance on deferred tax assets
10.9 (0.8)(7.6)5.2 
State income taxes, net of federal benefit
4.1 (2.5)1.3 (30.0)
Nondeductible stock-based compensation
0.3 0.8 0.1 2.9 
Change in Louisiana tax law(8.8)— 9.0 — 
Other
— 0.2 — 1.6 
Effective tax rate27.5 %18.7 %23.8 %0.7 %
Reconciliation of Beginning and Ending Balances for Derivative Instruments
The following is a reconciliation of the beginning and ending balances for derivative instruments classified as Level 3 in the fair value hierarchy:
Six Months Ended
June 30,
20212020
(In thousands)
Balance at beginning of year$(22,588)$4,351 
Total gain (loss) included in earnings(30,262)11,454 
Settlements, net
5,402 (22,585)
Transfers out of Level 3(6,418)— 
Balance at end of period$(53,866)$(6,780)
Summary of Carrying Amounts and Fair Values of Financial Instruments
The following presents the carrying amounts and the fair values of the Company's financial instruments as of June 30, 2021 and December 31, 2020:
June 30, 2021December 31, 2020
Carrying ValueFair ValueCarrying ValueFair Value
Assets:(In thousands)
Derivative financial instruments (1)
$11,595 $11,595 $9,574 $9,574 
Liabilities:
Derivative financial instruments (1)
$269,284 $269,284 $49,369 $49,369 
Bank credit facility (2)
$475,000 $475,000 $500,000 $500,000 
7.50% senior notes due 2025 (3)
$191,774 $253,565 $473,728 $628,691 
9.75% senior notes due 2026 (3)
$— $— $1,577,824 $1,769,625 
6.75% senior notes due 2029 (3)
$1,257,257 $1,328,125 $— $— 
5.875% senior notes due 2030 (3)
$965,000 $984,300 $— $— 
______________
(1)The Company's natural gas price swaps and basis swap agreements, its interest rate swap agreements and its crude oil and natural gas price collars are classified as Level 2 and measured at fair value using a market approach using third party pricing services and other active markets or broker quotes that are readily available in the public markets. The Company's natural gas swaption contracts provide the counterparty the right, but not the obligation, to extend terms of an existing swap on predetermined dates. Due to subjectivity of the inputs used to value the counterparty rights in the contracts, these contracts are classified as Level 3 in the fair value hierarchy.
(2)The carrying value of our floating rate debt outstanding approximates fair value.
(3)The fair value of the Company's fixed rate debt was based on quoted prices as of June 30, 2021 and December 31, 2020, respectively, a Level 1 measurement.
Weighted Average Shares of Unvested Restricted Stock Weighted average shares of unvested restricted stock outstanding were as follows:
Three Months Ended
June 30,		Six Months Ended
June 30,
2021202020212020
(in thousands)
Unvested restricted stock1,091 1,184 1,063 1,135 
Common Stock and Convertible Stock Dilutive in Weighted average unearned PSUs outstanding The treasury stock method is used to measure the dilutive effect of PSUs. Weighted average unearned PSUs outstanding were as follows:
Three Months Ended
June 30,		Six Months Ended
June 30,
2021202020212020
(In thousands, except per unit amounts)
Weighted average PSUs1,192 976 1,165 951 
Weighted average grant date fair value per unit$9.21 $9.33 $9.21 $9.33 
Weighted Average Shares of Convertible Preferred Stock Weighted average shares of convertible preferred stock outstanding were as follows:
Three Months Ended
June 30,		Six Months Ended
June 30,
2021202020212020
(In thousands)
Weighted average convertible preferred stock43,750 72,019 43,750 84,135 
Cash Payments Made for Interest and Income Taxes
Cash payments made for interest and income taxes and other non-cash investing activities for the six months ended June 30, 2021 and 2020, respectively, were as follows:
Six Months Ended
June 30,
20212020
(In thousands)
Cash payments for:
Interest payments$204,615 $90,552 
Non-cash investing activities include:
Increase (decrease) in accrued capital expenditures$785 $(29,078)
Liabilities assumed in exchange for right-of-use lease assets$4,998 $1,505 
Non-cash financing activities include:
Retirement of debt in exchange for common stock$— $(4,151)
Issuance of common stock in exchange for debt$— $5,012