Revenue Recognition

3 Months Ended

Mar. 31, 2020

Revenue from Contract with Customer [Abstract]

Exploration and production revenues

Revenues associated with contracts with customers for crude oil, natural gas and NGL sales and other services were as follows for the three months ended March 31, 2020 and 2019:


Exploration and Production Revenues
	Three Months Ended March 31,
	2020		2019

	(In thousands)
Crude oil revenues	$	212,793	$	318,120
Purchased crude oil sales	85,757		147,136
Natural gas and NGL revenues	26,335		50,662
Purchased natural gas sales	521		1,335
Other services revenues⁽¹⁾	5,981		10,458
Total exploration and production revenues	$	331,387	$	527,711

__________________

(1)Represents revenues for equipment rentals and well services provided by the Company’s wholly-owned subsidiary, Oasis Well Services LLC (“OWS”), excluding intercompany revenues for services performed for the Company’s ownership interests, which are eliminated in consolidation and are therefore not included in consolidated exploration and production revenues.

Prior period performance obligations. For sales of commodities, the Company records revenue in the month production is delivered to the purchaser. However, settlement statements and payments are typically not received for 20 to 60 days after the date production is delivered, and as a result, the Company is required to estimate the amount of production that was delivered to the purchaser and the price that will be received for the sale of the product. The Company records the differences between estimates and the actual amounts received for product sales once payment is received from the purchaser. Such differences have historically not been significant. The Company uses knowledge of its properties, its properties’ historical performance, spot market prices and other factors as the basis for these estimates. For the three months ended March 31, 2020 and 2019, revenue recognized related to performance obligations satisfied in prior reporting periods was not material.

Midstream revenues

Revenues associated with contracts with customers for midstream services under fee-based arrangements and midstream product sales from purchase arrangements were as follows for the three months ended March 31, 2020 and 2019:


Midstream Revenues⁽¹⁾
	Three Months Ended March 31,
	2020		2019

	(In thousands)
Midstream service revenues
Crude oil and natural gas revenues	$	26,921	$	24,664
Produced and flowback water revenues	11,251		9,033
Total midstream service revenues	$	38,172	$	33,697
Midstream product revenues

Natural gas and NGL revenues	$	16,039	$	12,797
Freshwater revenues	2,200		1,527
Total midstream product revenues	$	18,239	$	14,324
Total midstream revenues	$	56,411	$	48,021

__________________

(1)Represents midstream revenues, excluding intercompany revenues for work performed by the midstream business segment for the Company’s ownership interests, which are eliminated in consolidation and are therefore not included in consolidated midstream revenues.

Prior period performance obligations. The Company records revenue for midstream services or product sales when the performance obligations under the terms of its customer contracts are satisfied. The Company measures the satisfaction of its performance obligations using the output method based upon the volume of crude oil, natural gas or water that flows through its systems. In certain cases, the Company is required to estimate these volumes during a reporting period and record any differences between the estimated volumes and actual volumes in the following reporting period. Such differences have historically not been significant. For the three months ended March 31, 2020 and 2019, revenue recognized related to performance obligations satisfied in prior reporting periods was not material.

Contract balances

Contract balances are the result of timing differences between revenue recognition, billings and cash collections. Contract liabilities are recorded for consideration received from customers primarily related to (i) temporary deficiency quantities under minimum volume commitments, which are recognized as revenue when the customer makes up the volumes or the deficiency makeup period expires and (ii) aid in construction payments received from customers which are recognized as revenue over the expected period of future benefit. The Company does not recognize contract assets or contract liabilities under its customer contracts for which invoicing occurs once the Company’s performance obligations have been satisfied and payment is unconditional. Contract liabilities are classified as current or long-term based on the timing of when the Company expects to recognize revenue. The following table reflects the changes in the Company’s contract liabilities for the three months ended March 31, 2020:


	(In thousands)
Balance as of December 31, 2019	$	2,105
Cash received	—
Revenues recognized	(117)
Balance as of March 31, 2020	$	1,988

Remaining performance obligations

The following table presents estimated revenue allocated to remaining performance obligations for contracted revenues that are unsatisfied (or partially satisfied) as of March 31, 2020:


	(In thousands)
2020 (excluding the three months ended March 31, 2020)	$	12,403
2021	18,580
2022	18,302
2023	12,628
2024	11,874
Thereafter	2,768
Total	$	76,555

The partially and wholly unsatisfied performance obligations presented in the table above are generally limited to customer contracts which have fixed pricing and fixed volume terms and conditions, which generally include customer contracts with minimum volume commitment payment obligations.

The Company has elected practical expedients, pursuant to Accounting Standards Codification 606, Revenue from Contracts with Customers, to exclude from the presentation of remaining performance obligations: (i) contracts with index-based pricing or variable volume attributes in which such variable consideration is allocated entirely to a wholly unsatisfied performance obligation or to a wholly unsatisfied promise to transfer a distinct service that forms part of a series of distinct services and (ii) contracts with an original expected duration of one year or less.