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Assets and Liabilities Measured at Fair Value | 12 Months Ended
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Dec. 31, 2024
Fair Value Disclosures [Abstract] |
Assets and Liabilities Measured at Fair Value | Note O – Assets and Liabilities Measured at Fair Value Fair Values – Recurring The Company carries certain assets and liabilities at fair value in its Consolidated Balance Sheets. The fair value hierarchy is based on the quality of inputs used to measure fair value, with Level 1 being the highest quality and Level 3 being the lowest quality. Level 1 inputs are quoted prices in active markets for identical assets or liabilities. Level 2 inputs are observable inputs other than quoted prices included within Level 1. Level 3 inputs are unobservable inputs which reflect assumptions about pricing by market participants. The fair value measurements for these assets and liabilities for the respective periods presented are shown in the following table.
| December 31, 2024 |  | December 31, 2023
(Thousands of dollars) | Level 1 |  | Level 2 |  | Level 3 |  | Total |  | Level 1 |  | Level 2 |  | Level 3 |  | Total
Liabilities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Nonqualified employee savings plan | $ | 19,469 |  |  | $ | — |  |  | $ | — |  |  | $ | 19,469 |  |  | $ | 17,785 |  |  | $ | — |  |  | $ | — |  |  | $ | 17,785 |
Commodity swaps | — |  |  | 1,707 |  |  | — |  |  | 1,707 |  |  | — |  |  | — |  |  | — |  |  | — |
| $ | 19,469 |  |  | $ | 1,707 |  |  | $ | — |  |  | $ | 21,176 |  |  | $ | 17,785 |  |  | $ | — |  |  | $ | — |  |  | $ | 17,785 |
The nonqualified employee savings plan is an unfunded savings plan through which participants seek a return via phantom investments in equity securities and/or mutual funds. The fair value of this liability was based on quoted prices for these equity securities and mutual funds. The income effect of changes in the fair value of the nonqualified employee savings plan is recorded in “Selling and general expenses” in the Consolidated Statements of Operations. The commodity swaps liability as of December 31, 2024 was $1.7 million and recorded as “Accounts payable” in the Consolidated Balance Sheets. The fair value of the commodity swaps was based on active market quotes for NYMEX Henry Hub natural gas. The before tax income effect of changes in fair value of natural gas derivative contracts is recorded in “(Loss) Gain on derivative instruments” in the Consolidated Statements of Operations. The Company acquired Gulf of America assets from LLOG Exploration Offshore L.L.C. and LLOG Bluewater Holdings, L.L.C. (collectively, LLOG) and, in a separate agreement, from Petrobras America Inc. (PAI) in 2019 and 2018, respectively. Under the terms of both transactions, contingent consideration was paid after meeting specified revenue thresholds and project milestones and recorded to “Contingent consideration payment” in the Consolidated Statements of Cash Flows. As at December 31, 2022, the Company’s liabilities with PAI and LLOG were based on realized inputs of volumes and pricing as a result of contractual thresholds and time durations being achieved. As a result, the related liability as at December 31, 2022, of $192.7 million, was no longer subject to fair value measurement. The liability was included in “Other accrued liabilities” in the Consolidated Balance Sheets and the changes in fair value of the contingent consideration during 2022 were recorded in “Other income (loss)” in the Consolidated Statements of Operations. The Company offsets certain assets and liabilities related to derivative contracts when the legal right of offset exists. There were no offsetting positions recorded at December 31, 2024 and 2023. The following table presents the carrying amounts and estimated fair values of financial instruments held by the Company at December 31, 2024 and 2023. The fair value of a financial instrument is the amount at which the instrument could be exchanged in a current transaction between willing parties. The table excludes cash and cash equivalents, trade accounts receivable, trade accounts payable and accrued expenses, all of which had fair values approximating carrying amounts. The fair value of current and long-term debt was estimated based on rates offered to the Company at that time for debt of the same maturities. Substantially all of the Company’s long-term debt is actively traded in open markets, and accordingly, is classified as Level 1 in the fair value hierarchy. The Company has off-balance sheet exposures relating to certain letters of credit. The fair value of these, which represents fees associated with obtaining the instruments, was nominal.
| December 31,
| 2024 |  | 2023
(Thousands of dollars) | Carrying Amount |  | Fair Value |  | Carrying Amount |  | Fair Value
Financial liabilities: |  |  |  |  |  |  |
Current and long-term debt | $ | 1,275,374 |  |  | $ | 1,185,961 |  |  | $ | 1,329,075 |  |  | $ | 1,265,185 |
Fair Values – Nonrecurring Impairment expenses of $62.9 million were incurred in 2024. In the first quarter of 2024, an impairment charge of $34.5 million was triggered for the Calliope field, and in the fourth quarter of 2024, an impairment charge of $28.4 million was triggered for the Nearly Headless Nick field. Both of the impairments were due to operational issues that led to reserve reductions. There were no impairment expenses incurred in 2023. The fair values were determined by internal discounted cash flow models using estimates of future production, prices, costs and discount rates believed to be consistent with those used by principal market participants in the applicable region. The fair value information associated with the impaired properties is presented in the following table:
| Year Ended December 31, 2024
|  |  |  |  |  |  | Net Book Value Prior to Impairment |  | Total Pretax Impairment
| Fair Value |  |
(Thousands of dollars) | Level 1 |  | Level 2 |  | Level 3 |  |
2024 |  |  |  |  |  |  |  |  |
Assets: |  |  |  |  |  |  |  |  |
Impaired proved properties |  |  |  |  |  |  |  |  |
United States - Offshore | $ | — |  |  | — |  |  | 501 |  |  | 63,410 |  |  | 62,909 |

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- Definition The entire disclosure of the fair value measurement of assets and liabilities, which includes financial instruments measured at fair value that are classified in shareholders' equity, which may be measured on a recurring or nonrecurring basis. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 820 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/820/tableOfContent + Details
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