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Long-Term Debt | 6 Months Ended
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Jun. 30, 2022
Debt Disclosure [Abstract] |
Long-Term Debt | Note 5 - Long-Term Debt The following table summarizes the total outstanding balance of the Company’s Senior Secured Notes net of unamortized discount and deferred financing costs, and Senior Unsecured Notes net of unamortized deferred financing costs, as of June 30, 2022, and December 31, 2021:
|  |  | As of June 30, 2022 |  | As of December 31, 2021
|  |  | (in thousands)
Senior Secured Notes (1) |  |  | $ | — |  |  | $ | 407,712 |
Senior Unsecured Notes (1) |  |  | 1,570,648 |  |  | 1,673,452 |
Total |  |  | $ | 1,570,648 |  |  | $ | 2,081,164 |
____________________________________________ (1) Senior Secured Notes and Senior Unsecured Notes are defined below. Credit Agreement The Credit Agreement was scheduled to mature on September 28, 2023, but was amended and restated by the New Credit Agreement on August 2, 2022, as discussed below. Prior to the effective date of the New Credit Agreement, the Credit Agreement provided for a senior secured revolving credit facility with a maximum loan amount of $2.5 billion. As of June 30, 2022, the borrowing base and aggregate lender commitments under the Credit Agreement were $1.1 billion. Under the Credit Agreement, interest and commitment fees associated with the revolving credit facility were accrued based on a borrowing base utilization grid as presented in Note 5 - Long-Term Debt in the 2021 Form 10-K. At the Company’s election, borrowings under the Credit Agreement could be in the form of Eurodollar, Alternate Base Rate (“ABR”), or Swingline loans. Eurodollar loans accrued interest at the London Interbank Offered Rate (“LIBOR”), plus the applicable margin from the utilization grid, and ABR and Swingline loans accrued interest at a market-based floating rate, plus the applicable margin from the utilization grid. Commitment fees were accrued on the unused portion of the aggregate lender commitment amount at rates from the utilization grid and are included in the interest expense line item on the accompanying statements of operations. The following table presents the outstanding balance, total amount of letters of credit outstanding, and available borrowing capacity under the Credit Agreement as of July 20, 2022, June 30, 2022, and December 31, 2021:
| As of July 20, 2022 |  | As of June 30, 2022 |  | As of December 31, 2021
| (in thousands)
Revolving credit facility (1) | $ | — |  |  | $ | — |  |  | $ | — |
Letters of credit (2) | 6,000 |  |  | 6,000 |  |  | 2,500 |
Available borrowing capacity | 1,094,000 |  |  | 1,094,000 |  |  | 1,097,500 |
Total aggregate lender commitment amount | $ | 1,100,000 |  |  | $ | 1,100,000 |  |  | $ | 1,100,000 |
____________________________________________ (1) Unamortized deferred financing costs attributable to the revolving credit facility are presented as a component of the other noncurrent assets line item on the accompanying balance sheets and totaled $2.0 million and $2.7 million as of June 30, 2022, and December 31, 2021, respectively. These costs are being amortized over the term of the revolving credit facility on a straight-line basis. (2) Letters of credit outstanding reduce the amount available under the revolving credit facility on a dollar-for-dollar basis. New Credit Agreement On August 2, 2022, the Company entered into a Seventh Amended and Restated Credit Agreement by and among the Company, Wells Fargo Bank, National Association, as Administrative Agent and Swingline Lender (“Agent”), and the institutions named therein as lenders. The New Credit Agreement amends and restates the Credit Agreement, and provides for a senior secured revolving credit facility with a maximum loan amount of $3.0 billion, an initial borrowing base of $2.5 billion, and initial aggregate lender commitments totaling $1.25 billion. The revolving credit facility is secured by substantially all of the Company’s proved oil and gas properties. The borrowing base is subject to regular, semi-annual redetermination, and considers the value of both the Company’s (a) proved oil and gas properties reflected in the Company’s most recent reserve report; and (b) commodity derivative contracts, each as determined by the Company’s lender group. The New Credit Agreement is scheduled to mature on the earlier of (a) August 2, 2027 (“Stated Maturity Date”), or (b) 91 days prior to the maturity date of any of the Company’s outstanding Senior Notes, to the extent that, on or before such date, the respective Senior Notes have not been repaid, exchanged, repurchased, refinanced, or otherwise redeemed in full, and, if refinanced or exchanged, with a scheduled maturity date that is not earlier than at least 180 days after the Stated Maturity Date. In addition to other negotiated terms, conditions, agreements, and provisions, the New Credit Agreement establishes the Secured Overnight Financing Rate as the new benchmark for determining interest rates in replacement of LIBOR. LIBOR was discontinued as a global reference rate for new loans and contracts after December 31, 2021. The financial covenants under the New Credit Agreement require, among other customary covenants, that the Company’s (a) total funded debt, as defined by the New Credit Agreement, to 12-month trailing adjusted EBITDAX ratio cannot be greater than 3.50 to 1.00 on the last day of each fiscal quarter ended after June 30, 2022; and (b) adjusted current ratio, as defined in the New Credit Agreement, cannot be less than 1.00 to 1.00 as of the last day of any fiscal quarter. Senior Secured Notes On June 17, 2022, the Company redeemed all of the $446.7 million of aggregate principal amount outstanding of its 10.0% Senior Secured Notes due 2025 (“2025 Senior Secured Notes” or “Senior Secured Notes”). The 2025 Senior Secured Notes were redeemed with cash on hand, at a redemption price equal to 107.5 percent of the principal amount outstanding on the date of the redemption, plus accrued and unpaid interest. Upon redemption, the Company recorded a net loss on extinguishment of debt of $67.2 million which included $33.5 million of premium paid, $26.3 million of accelerated unamortized debt discount, and $7.4 million of accelerated unamortized deferred financing costs. The Company canceled all redeemed 2025 Senior Secured Notes upon settlement. Senior Secured Notes, net of unamortized discount and deferred financing costs, included within the Senior Notes, net line item on the accompanying balance sheets, as of December 31, 2021, consist of the following:
|  |  | As of December 31, 2021
|  |  | (in thousands)
Principal amount of 10.0% Senior Secured Notes due 2025 |  |  | $ | 446,675 |
Unamortized debt discount |  |  | 30,236 |
Unamortized deferred financing costs |  |  | 8,727 |
10.0% Senior Secured Notes due 2025, net of unamortized debt discount and deferred financing costs |  |  | $ | 407,712 |
Senior Unsecured Notes Senior Unsecured Notes, net of unamortized deferred financing costs, included within the Senior Notes, net line item on the accompanying balance sheets as of June 30, 2022, and December 31, 2021, consist of the following (collectively referred to as “Senior Unsecured Notes,” and together with the 2025 Senior Secured Notes, “Senior Notes”):
| As of June 30, 2022 |  | As of December 31, 2021
| Principal Amount |  | Unamortized Deferred Financing Costs |  | Principal Amount, Net |  | Principal Amount |  | Unamortized Deferred Financing Costs |  | Principal Amount, Net
| (in thousands)
5.0% Senior Notes due 2024 | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 104,769 |  |  | $ | 403 |  |  | $ | 104,366 |
5.625% Senior Notes due 2025 | 349,118 |  |  | 1,844 |  |  | 347,274 |  |  | 349,118 |  |  | 2,160 |  | 346,958 |
6.75% Senior Notes due 2026 | 419,235 |  |  | 2,919 |  |  | 416,316 |  |  | 419,235 |  |  | 3,270 |  | 415,965 |
6.625% Senior Notes due 2027 | 416,791 |  |  | 3,560 |  |  | 413,231 |  |  | 416,791 |  |  | 3,949 |  | 412,842 |
6.5% Senior Notes due 2028 | 400,000 |  |  | 6,173 |  |  | 393,827 |  |  | 400,000 |  |  | 6,679 |  |  | 393,321 |
Total | $ | 1,585,144 |  |  | $ | 14,496 |  |  | $ | 1,570,648 |  |  | $ | 1,689,913 |  |  | $ | 16,461 |  |  | $ | 1,673,452 |
The Senior Unsecured Notes are unsecured senior obligations and rank equal in right of payment with all of the Company’s existing and any future unsecured senior debt and are senior in right of payment to any future subordinated debt. The Company may redeem some or all of its Senior Unsecured Notes prior to their maturity at redemption prices based on a premium, plus accrued and unpaid interest as described in the indentures governing the Senior Unsecured Notes. On February 14, 2022, the Company redeemed all of the $104.8 million of aggregate principal amount outstanding of its 5.0% Senior Notes due 2024 (“2024 Senior Notes”), with cash on hand, pursuant to the terms of the indenture governing the 2024 Senior Notes which provided for a redemption price equal to 100 percent of the principal amount of the 2024 Senior Notes on the date of redemption, plus accrued and unpaid interest. Upon redemption, the Company recorded a net loss on extinguishment of debt of $0.4 million related to the acceleration of unamortized deferred financing costs. The Company canceled all redeemed 2024 Senior Notes upon settlement. On June 23, 2021, the Company issued $400.0 million in aggregate principal amount of its 6.5% Senior Notes at par with a maturity date of July 15, 2028 (“2028 Senior Notes”). The Company received net proceeds of $392.8 million after deducting fees of $7.2 million, which are being amortized as deferred financing costs over the life of the 2028 Senior Notes. The net proceeds were used to repurchase $193.1 million and $172.3 million of outstanding principal amount of the Company’s 6.125% Senior Notes due 2022 (“2022 Senior Notes”) and 2024 Senior Notes, respectively, through a cash tender offer (“Tender Offer”), and to redeem the remaining $19.3 million of 2022 Senior Notes not repurchased as part of the Tender Offer (“2022 Senior Notes Redemption”). The Company paid total consideration, excluding accrued interest, of $385.3 million, and recorded a net loss on extinguishment of debt of $2.1 million for the three months ended June 30, 2021, which included $1.5 million of accelerated unamortized deferred financing costs and $0.6 million of net premiums. The Company canceled all repurchased and redeemed 2022 Senior Notes and 2024 Senior Notes upon settlement. Please refer to Note 5 - Long-Term Debt in the 2021 Form 10-K for additional detail on the Company’s Senior Notes. Covenants The Company was subject under the Credit Agreement, and is subject under the New Credit Agreement and under the indentures governing the Senior Notes, to certain financial and non-financial covenants, as discussed above, that, among other terms, limit the Company’s ability to incur additional indebtedness, make restricted payments including dividends, sell assets, create liens that secure debt, enter into transactions with affiliates, merge or consolidate with other entities, and with respect to the Company’s restricted subsidiaries, permit the consensual restriction on the ability of such restricted subsidiaries to pay dividends or indebtedness owing to the Company or to any other restricted subsidiaries. The Company was in compliance with all financial and non-financial covenants as of June 30, 2022, and through the filing of this report. Please refer to Note 5 - Long-Term Debt in the 2021 Form 10-K for additional detail on the Company’s covenants under the Credit Agreement and the indentures governing the Senior Notes. Capitalized Interest Capitalized interest costs for the three months ended June 30, 2022, and 2021, totaled $4.2 million and $4.7 million, respectively, and totaled $7.2 million and $9.0 million for the six months ended June 30, 2022, and 2021, respectively. The amount of interest the Company capitalizes generally fluctuates based on the amount borrowed, the Company’s capital program, and the timing and amount of costs associated with capital projects that are considered in progress. Capitalized interest costs are included in total costs incurred.

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- Definition The entire disclosure for long-term debt. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -URI https://asc.fasb.org/topic&trid=2208564 + Details
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