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Fair Value Measurements
 3 Months Ended
Mar. 31, 2026
Fair Value Disclosures [Abstract]  
Fair Value Disclosures
Note 9 - Fair Value Measurements
The Company follows fair value measurement accounting guidance for all assets and liabilities measured at fair value. This guidance defines fair value as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the measurement date. Market or observable inputs are the preferred sources of values, followed by assumptions based on hypothetical transactions in the absence of market inputs. The fair value hierarchy for grouping these assets and liabilities is based on the significance level of the following inputs:
•Level 1 – quoted prices in active markets for identical assets or liabilities
•Level 2 – quoted prices in active markets for similar assets or liabilities, quoted prices for identical or similar instruments in markets that are not active, and model-derived valuations whose inputs are observable or whose significant value drivers are observable
•Level 3 – significant inputs to the valuation model are unobservable
The following table is a listing of the Company’s assets and liabilities that are measured at fair value on a recurring basis in the accompanying balance sheets and where they are classified within the fair value hierarchy:
As of March 31, 2026As of December 31, 2025
Level 1Level 2Level 3Level 1Level 2Level 3
(in millions)
Assets:
Derivatives
$— $228 $— $— $89 $— 
Liabilities:
Derivatives
$— $705 $— $— $4 $— 
Both financial and non-financial assets and liabilities are categorized within the fair value hierarchy based on the lowest level of input that is significant to the fair value measurement. The following is a description of the valuation methodologies used by the Company as well as the general classification of such instruments pursuant to the above fair value hierarchy.
Derivatives
The Company uses Level 2 inputs to measure the fair value of oil, gas, and NGL commodity derivative instruments. Fair values are based upon interpolated data. The Company derives internal valuation estimates taking into consideration forward commodity price curves, counterparties’ credit ratings, the Company’s credit rating, and the time value of money. These valuations are then compared to the respective counterparties’ mark-to-market statements. The considered factors result in an estimated exit price that management believes provides a reasonable and consistent methodology for valuing derivative instruments. The commodity derivative instruments utilized by the Company are not considered by management to be complex, structured, or illiquid. The oil, gas, and NGL commodity derivative markets are highly active. Refer to Note 8 - Derivative Financial Instruments for more information regarding the Company’s derivative instruments.
Acquisition of Proved and Unproved Properties
Assets acquired and liabilities assumed in transactions that meet the definition of a business combination under ASC 805 are recognized at their estimated fair values as of the acquisition date and are valued using an income valuation technique based on Level 3 inputs. The excess of consideration transferred over the fair value of identifiable net assets acquired is recorded as goodwill. Refer to Note 2 - Mergers, Acquisitions, and Divestitures for discussion of the valuation technique used for the Civitas Merger.
Properties Held for Sale
Properties classified as held for sale, including any corresponding asset retirement obligation liability, are valued using a market approach, based on an estimated net selling price, as evidenced by an executed or negotiated purchase and sale agreement, or, if unavailable, the most current bid prices received from third parties. If an estimated selling price is not available, the Company utilizes the various valuation techniques discussed above. Any initial write-down and subsequent changes to the fair value less estimated cost to sell is included within the net gain (loss) on divestiture activity line item in the accompanying statements of operations.
The Company had $666 million of assets classified as held for sale as of March 31, 2026, related to the South Texas Divestiture; however, none of these properties were recorded at fair value as the carrying value of these assets was below their estimated fair value less estimated selling costs. Refer to Note 2 - Mergers, Acquisitions, and Divestitures for additional discussion.
Long-Term Debt
The following table reflects the fair value of the Company’s Senior Notes obligations measured using Level 1 inputs based on quoted secondary market trading prices. The Senior Notes were not presented at fair value in the accompanying balance sheets as of March 31, 2026, or December 31, 2025, as the Senior Notes were recorded at carrying value, net of any unamortized premium or unamortized deferred financing costs. Refer to Note 6 - Long-Term Debt for additional information.
As of March 31, 2026As of December 31, 2025
Principal AmountFair ValuePrincipal AmountFair Value
(in millions)
6.75% Senior Notes due 2026 (1)
$419 $420 $419 $420 
5.0% Senior Notes due 2026 (1)(2)
$400 $399 $— $— 
6.625% Senior Notes due 2027
$417 $417 $417 $419 
8.375% Senior Notes due 2028 (2)
$566 $583 $— $— 
6.5% Senior Notes due 2028
$400 $401 $400 $405 
6.75% Senior Notes due 2029
$750 $764 $750 $756 
8.625% Senior Notes due 2030 (2)
$1,000 $1,054 $— $— 
8.75% Senior Notes due 2031 (2)
$1,350 $1,417 $— $— 
7.0% Senior Notes due 2032
$750 $766 $750 $739 
9.625% Senior Notes due 2033 (2)
$750 $830 $— $— 
6.625% Senior Notes due 2034
$1,000 $1,002 $— $— 
____________________________________________
(1)    As of March 31, 2026, the 2026 Senior Notes, the Civitas 2026 Senior Notes, and the 2027 Senior Notes are presented in the current liabilities section of the accompanying balance sheets.
(2)    Civitas Senior Notes assumed as part of the Civitas Merger.