XML 21 R10.htm IDEA: XBRL DOCUMENT
v3.5.0.2

Equity Investments | 6 Months Ended
--- | ---
Jun. 30, 2016
Equity Method Investments and Joint Ventures [Abstract] |
Equity Investments | EQUITY INVESTMENTS Investments accounted for by the equity method consist of the following as of June 30, 2016 and December 31, 2015:
|  |  | Carrying value |  | Loss (income) from equity method investments
| Approximate ownership % |  | June 30, 2016 |  | December 31, 2015 |  | Three months ended June 30, |  | Six months ended June 30,
|  |  |  | 2016 |  | 2015 |  | 2016 |  | 2015
|  |  | (In thousands)
Investment in Tatex Thailand II, LLC | 23.5 | % |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | (159 | ) |  | $ | — |
Investment in Tatex Thailand III, LLC | 17.9 | % |  | — |  |  | — |  |  | — |  |  | 189 |  |  | — |  |  | 189 |
Investment in Grizzly Oil Sands ULC | 24.9999 | % |  | 49,556 |  |  | 50,645 |  |  | 763 |  |  | 8,494 |  |  | 24,448 |  |  | 12,636 |
Investment in Timber Wolf Terminals LLC | 50.0 | % |  | 996 |  |  | 999 |  |  | 1 |  |  | 7 |  |  | 4 |  |  | 13 |
Investment in Windsor Midstream LLC | 22.5 | % |  | 26,147 |  |  | 27,955 |  |  | (2,881 | ) |  | 881 |  |  | (3,048 | ) |  | (17,906 | )
Investment in Stingray Cementing LLC | 50.0 | % |  | 2,359 |  |  | 2,487 |  |  | 78 |  |  | 105 |  |  | 108 |  |  | 172 |
Investment in Blackhawk Midstream LLC | 48.5 | % |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | (7,217 | )
Investment in Stingray Energy Services LLC | 50.0 | % |  | 4,981 |  |  | 5,908 |  |  | 139 |  |  | 311 |  |  | 641 |  |  | 321 |
Investment in Sturgeon Acquisitions LLC | 25.0 | % |  | 22,258 |  |  | 22,769 |  |  | 134 |  |  | (491 | ) |  | 511 |  |  | (1,059 | )
Investment in Mammoth Energy Partners LP | 30.5 | % |  | 121,309 |  |  | 131,630 |  |  | 2,543 |  |  | 5,624 |  |  | 9,009 |  |  | 7,996 |
Investment in Strike Force Midstream LLC | 25.0 | % |  | 25,441 |  |  | — |  |  | 59 |  |  | — |  |  | 59 |  |  | — |
|  |  | $ | 253,047 |  |  | $ | 242,393 |  |  | $ | 836 |  |  | $ | 15,120 |  |  | $ | 31,573 |  |  | $ | (4,855 | )
The tables below summarize financial information for the Company's equity investments as of June 30, 2016 and December 31, 2015. Summarized balance sheet information:
| June 30, 2016 |  | December 31, 2015
| (In thousands)
Current assets | $ | 105,614 |  |  | $ | 105,537 |
Noncurrent assets | $ | 1,330,877 |  |  | $ | 1,293,925 |
Current liabilities | $ | 41,238 |  |  | $ | 56,559 |
Noncurrent liabilities | $ | 146,642 |  |  | $ | 155,995 |
Summarized results of operations:
| Three months ended June 30, |  | Six months ended June 30,
| 2016 |  | 2015 |  | 2016 |  | 2015
| (In thousands)
Gross revenue | $ | 86,732 |  |  | $ | 130,134 |  |  | $ | 130,039 |  |  | $ | 263,690 |
Net (loss) income | $ | (560 | ) |  | $ | (45,246 | ) |  | $ | (25,868 | ) |  | $ | 45,422 |
Tatex Thailand II, LLC The Company has an indirect ownership interest in Tatex Thailand II, LLC (“Tatex II”). Tatex II holds 85,122 of the 1,000,000 outstanding shares of APICO, LLC (“APICO”), an international oil and gas exploration company. APICO has a reserve base located in Southeast Asia through its ownership of concessions covering approximately 243,000 acres which includes the Phu Horm Field. During the six months ended June 30, 2016, the Company received $0.2 million in distributions from Tatex II. Tatex Thailand III, LLC The Company has an ownership interest in Tatex Thailand III, LLC ("Tatex III"). Tatex III previously owned a concession covering approximately 245,000 acres in Southeast Asia. As of December 31, 2014, the Company reviewed its investment in Tatex III and made the decision to allow the concession to expire in January 2015. As such, the Company fully impaired the asset as of December 31, 2014. Grizzly Oil Sands ULC The Company, through its wholly owned subsidiary Grizzly Holdings Inc. ("Grizzly Holdings"), owns an interest in Grizzly Oil Sands ULC ("Grizzly"), a Canadian unlimited liability company. The remaining interest in Grizzly is owned by Grizzly Oil Sands Inc. ("Oil Sands"). As of June 30, 2016, Grizzly had approximately 830,000 acres under lease in the Athabasca and Peace River oil sands regions of Alberta, Canada. Initiation of steam injection at its first project, Algar Lake Phase 1, commenced in January 2014 and first bitumen production was achieved during the second quarter of 2014. In April 2015, Grizzly determined to cease bitumen production at its Algar Lake facility due to the level of commodity prices. Grizzly continues to monitor market conditions as it assesses future plans for the facility. The Company reviewed its investment in Grizzly at March 31, 2016 for impairment based on FASB ASC 323 due to certain qualitative factors and engaged an independent third party to assist management in determining fair value calculations of its investment. As a result of the calculated fair values and other qualitative factors, the Company concluded that an other than temporary impairment was required under FASB ASC 323, resulting in an impairment loss of $23.1 million for the three months ended March 31, 2016, which is included in loss (income) from equity method investments in the consolidated statements of operations. As of June 30, 2016, commodity prices had increased as compared to the prior quarter and there were no impairment indicators that required further evaluation for impairment. If commodity prices decline in the future, however, further impairment of the investment in Grizzly may be necessary. During the six months ended June 30, 2016, Gulfport paid $13.7 million in cash calls. Grizzly’s functional currency is the Canadian dollar. The Company's investment in Grizzly was decreased by $0.6 million as a result of a foreign currency translation loss and increased by $9.7 million as a result of a foreign currency translation gain for the three and six months ended June 30, 2016, respectively. The Company's investment in Grizzly was increased by $3.2 million as a result of a foreign currency translation gain and decreased by $11.7 million as a result of a foreign currency translation loss for the three and six months ended June 30, 2015, respectively. Effective October 5, 2012, Grizzly entered into a $125.0 million revolving credit facility, under which $57.2 million was outstanding at June 30, 2016. Grizzly has agreed to pay the outstanding balance by the payoff date in July 2016. Gulfport paid its share of this amount on June 30, 2016. Timber Wolf Terminals LLC During 2012, the Company invested in Timber Wolf Terminals LLC (“Timber Wolf”). Timber Wolf was formed to operate a crude/condensate terminal and a sand transloading facility in Ohio. Windsor Midstream LLC During 2012, the Company purchased an ownership interest in Windsor Midstream LLC (“Midstream”). Midstream owned a 28.4% interest in Coronado Midstream LLC ("Coronado"), a gas processing plant in West Texas. In March 2015, Coronado was sold to Enlink Midstream Partners, LP ("EnLink") for proceeds of approximately $600.0 million, consisting of cash and units representing a limited partnership interest in Enlink. Midstream recorded an $81.6 million gain on the sale of its investment in Coronado. The Company received $4.9 million in distributions from Midstream during the six months ended June 30, 2016. Stingray Cementing LLC During 2012, the Company invested in Stingray Cementing LLC ("Stingray Cementing"). Stingray Cementing provides well cementing services. The loss (income) from equity method investments presented in the table above reflects any intercompany profit eliminations. Blackhawk Midstream LLC During 2012, the Company invested in Blackhawk Midstream LLC ("Blackhawk"). Blackhawk was formed to coordinate gathering, compression, processing and marketing activities for the Company in connection with the development of its Utica Shale acreage. On January 28, 2014, Blackhawk completed the sale of its equity interests in Ohio Gathering Company, LLC and Ohio Condensate Company, LLC for a purchase price of $190.0 million, of which $14.3 million was placed in escrow. During the first quarter of 2015, the Company received net proceeds of approximately $7.2 million from the release of escrow from the Blackhawk sale, which is included in loss (income) from equity method investments in the consolidated statements of operations. Stingray Energy Services LLC During 2013, the Company invested in Stingray Energy Services LLC ("Stingray Energy"). Stingray Energy provides rental tools for land-based oil and natural gas drilling, completion and workover activities as well as the transfer of fresh water to wellsites. The loss (income) from equity method investments presented in the table above reflects any intercompany profit eliminations. Sturgeon Acquisitions LLC During 2014, the Company invested $20.7 million and received an ownership interest of 25% in Sturgeon Acquisitions LLC ("Sturgeon"). Sturgeon owns and operates sand mines that produce hydraulic fracturing grade sand. Mammoth Energy Partners LP In the fourth quarter of 2014, the Company contributed its investments in four entities to Mammoth Energy Partners LP ("Mammoth") for a 30.5% interest in this entity. Mammoth originally intended to pursue its initial public offering in 2014 or 2015; however, Mammoth continues to evaluate market conditions and expects to undertake this offering when commodity prices have recovered. The Company reviewed its investment in Mammoth at June 30, 2016 and determined no impairment was needed. If commodity prices decline in the future, an impairment of the investment in Mammoth may result. The Company's investment in Mammoth was decreased by $1.3 million as a result of a foreign currency loss from Mammoth's foreign subsidiary for the six months ended June 30, 2016. The loss (income) from equity method investments presented in the table above reflects any intercompany profit eliminations. Strike Force Midstream LLC In February 2016, the Company, through its wholly owned subsidiary Gulfport Midstream Holdings, LLC ("Midstream Holdings"), entered into an agreement with Rice Midstream Holdings LLC ("Rice"), a subsidiary of Rice Energy Inc., to develop natural gas gathering assets in eastern Belmont County and Monroe County, Ohio (the "dedicated areas"). The Company contributed certain gathering assets for a 25% interest in the newly formed entity called Strike Force Midstream LLC ("Strike Force"). Rice acts as operator and owns the remaining 75% interest in Strike Force. Construction of the gathering assets, which is underway, is expected to provide gathering services for Gulfport operated wells and connectivity of existing dry gas gathering systems. Strike Force has completed the first phase of the projects: a lateral that connects two existing dry gas gathering systems on which the Company currently flows the majority of its dry gas volumes. First flow from the lateral commenced on February 1, 2016. During the six months ended June 30, 2016, Gulfport paid $3.0 million in cash calls to Strike Force. The Company accounted for its contribution to Strike Force at fair value under applicable codification guidance. The Company estimated the fair market value of its investment in Strike Force as of the contribution date using the discounted cash flow method under the income approach, based on an independently prepared valuation of the contributed assets. The fair market value was reduced by a discount factor for the lack of marketability due to the Company's minority interest, resulting in a fair value of $22.5 million for the Company's 25% interest. The fair value of the assets contributed was estimated using assumptions that represent Level 3 inputs. See "Note 12 - Fair Value Measurements" for additional discussion of the measurement inputs. The Company has elected to report its proportionate share of Strike Force's earnings on a one-quarter lag as permitted under FASB ASC 323. The loss (income) from equity method investments presented in the table above reflects any intercompany profit eliminations.

X
- References No definition available. + Details
Name: | us-gaap_EquityMethodInvestmentsAndJointVenturesAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for equity method investments and joint ventures. Equity method investments are investments that give the investor the ability to exercise significant influence over the operating and financial policies of an investee. Joint ventures are entities owned and operated by a small group of businesses as a separate and specific business or project for the mutual benefit of the members of the group. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 323 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=6382943&loc=d3e33918-111571 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 323 -SubTopic 10 -Section 35 -Paragraph 35 -URI http://asc.fasb.org/extlink&oid=49116238&loc=d3e32847-111569 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 210 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.5-02.12) -URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 323 -SubTopic 10 -Section 35 -Paragraph 32 -URI http://asc.fasb.org/extlink&oid=49116238&loc=d3e32787-111569 + Details
Name: | us-gaap_EquityMethodInvestmentsDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration