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Related Party Transactions | 12 Months Ended
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Dec. 31, 2021
Related Party Transactions [Abstract] |
Related Party Transactions | Related Party Transactions KKR Group Management Agreement In connection with the Merger Transactions, we entered into a management agreement (the "Management Agreement") with KKR Energy Assets Manager LLC (the "Manager"). Pursuant to the Management Agreement, the Manager provides the Company with its executive management team and certain management services. The Management Agreement has an initial term of three years and shall renew automatically at the end of the initial term for an additional three-year period unless the Company or the Manager elects not to renew the Management Agreement. As consideration for the services rendered pursuant to the Management Agreement and the Manager’s overhead, including compensation of the executive management team, the Manager is entitled to receive compensation ("Management Compensation") equal to $13.5 million per annum, which represents our pro rata portion (based on our relative ownership of OpCo) of $53.3 million. This amount will increase over time as our ownership percentage of OpCo increases. In addition, as our business and assets expand, Management Compensation may increase by an amount equal to 1.5% per annum of the net proceeds from all future issuances of our equity securities (including in connection with acquisitions). However, incremental Management Compensation will not apply to the issuance of our shares upon the redemption or exchange of OpCo Units. During the year ended December 31, 2021, we recorded general and administrative expense of $0.9 million, related to the Management Agreement. Additionally, the Manager is entitled to receive incentive compensation ("Incentive Compensation") under which the Manager is targeted to receive 10% of our outstanding Class A Common Stock based on the achievement of certain performance-based measures. The Incentive Compensation consists of five tranches that settle over a five year period beginning in 2024, and each tranche relates to a target number of shares of Class A common stock equal to 2% of the outstanding Class A common stock as of the time such tranche is settled. So long as the Manager continuously provides services to us until the end of the performance period applicable to a tranche, the Manager is entitled to settlement of such tranche with respect to a number of shares of Class A common stock ranging from 0% to 240% of the initial target amount based on the level of achievement with respect to the performance goals applicable to such tranche. During the year ended December 31, 2021, we granted the Performance Stock Units associated with the Incentive Compensation. See NOTE 13 – Incentive Compensation Arrangements for more information. KKR Funds From time to time, we may invest in upstream oil and gas assets alongside EIGF II and/or other KKR funds ("KKR Funds") pursuant to the terms of the Management Agreement. In these instances, certain of our consolidated subsidiaries enter into Master Service Agreements ("MSA") with entities owned by KKR Funds, pursuant to which our subsidiaries provide certain services to such KKR Funds, including the allocation of the production and sale of oil, natural gas and NGLs, collection and disbursement of revenues, operating expenses and general and administrative expenses in the respective oil and natural gas properties, and the payment of all capital costs associated with the ongoing operations of the oil and natural gas assets. Our subsidiaries settle balances due to or due from KKR Funds on a monthly basis. The administrative costs associated with these MSAs are allocated by us to KKR Funds based on (i) an actual basis for direct expenses we may incur on their behalf or (ii) an allocation of such charges between the various KKR Funds based on the estimated use of such services by each party. As of December 31, 2021, we had a related party receivable of $3.3 million included within Accounts receivable – affiliates and $7.0 million included within Accounts payable – affiliates on our consolidated balance sheets associated with KKR Funds transactions. Other Transactions We paid $1.6 million in fees to KKR Capital Markets LLC, an affiliate of KKR, for services provided as a book-running manager in connection with the issuance of our Senior Notes in May 2021 and recorded as debt issuance costs within Long-term debt on the consolidated balance sheets. Additionally, we paid $0.1 million to KKR Capstone Americas LLC for professional fees support related to insurance and employee benefits due diligence and placement and recorded as General and administrative expense on the combined and consolidated statements of operations. In February 2022, we paid $0.4 million in fees to KKR Capital Markets LLC in connection with the issuance of the New Notes. See NOTE 16 – Subsequent Events. FDL On April 1, 2021, certain minority investors, including FDL Operating LLC ("FDL") management, exchanged 100% of their interests in our Barnett basin natural gas assets for 9,508 of our predecessor Class A units, representing 0.77% of our consolidated ownership. Since we already consolidate the results of these assets, this transaction was accounted for as an equity transaction and reflected as a reclassification from noncontrolling interests to members' equity with no gain or loss recognized on the exchange (the "April 2021 Exchange"). As of December 31, 2021, FDL's management owns less than 0.15% of our Class B shares and holds noncontrolling interests in certain of our consolidated subsidiaries. Certain of our consolidated subsidiaries have entered into an Oil and Natural Gas Property Operating and Services Agreement (the “FDL Agreement”) with FDL. Pursuant to the FDL Agreement, FDL was engaged to manage the day-to-day operations of the business activities of certain of our consolidated subsidiaries, including allocating to us and other interest holders the production and sale of oil, natural gas and natural gas liquids, collection and disbursement of revenues, operating expenses and general and administrative expenses in the respective oil and natural gas properties and the payment of all capital costs associated with the ongoing operations of such properties. As part of the engagement, FDL will then allocate the revenues, operating expenses, general and administrative expenses and cash collected to us and others as appropriate. We settle balances due to or due from FDL on a monthly basis. As of December 31, 2021, we had a net related party receivable due from FDL totaling $16.9 million and at December 31, 2020, we had a net related party payable due to FDL totaling $7.5 million, included within Accounts receivable – affiliates and Accounts payable – affiliates, respectively, on our consolidated balance sheets. On September 20, 2021 we provided notice that we are terminating the FDL Agreement effective on March 31, 2022. During October 2021, as part of the termination principal terms, we agreed to pay up to $6.5 million in wind down costs and additional severance costs for certain qualifying, dedicated employees, of which any unused portion will be returned to us at the end of the wind down period. During the year ended December 31, 2021, we recorded $3.3 million of expense associated with the termination. RPM An affiliate of KKR Group has entered into a Master Management Services Agreement (the “MSA”) with a subsidiary of RPM Energy Management Partnership L.P. (“RPM”) to act as the manager of certain mineral and non-operated assets controlled by our consolidated subsidiaries. Pursuant to the MSA and under management of certain KKR affiliated entities, RPM manages the day-to-day operations of the business activities of certain of our oil and natural gas properties. We reimburse RPM for all reasonable out-of-pocket expenses incurred for fulfilling its obligations under the MSA (“Allocable Overhead Costs”). The Allocable Overhead Costs are charged to us on an actual basis without mark-up or subsidy. As such, the Allocable Overhead Costs approximate reasonable market rates and are representative of the expenses that we would have incurred had we not entered into the MSA. We settle balances due to or due from RPM on a monthly basis. As of December 31, 2021 and 2020 we had a payable due to RPM of $1.7 million included within Accounts payable - affiliates on our consolidated balance sheets. On December 31, 2021, we terminated our relationship with RPM.

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- Definition The entire disclosure for related party transactions. Examples of related party transactions include transactions between (a) a parent company and its subsidiary; (b) subsidiaries of a common parent; (c) and entity and its principal owners; and (d) affiliates. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 850 -SubTopic 10 -Section 50 -Paragraph 1 -Subparagraph (d) -URI http://asc.fasb.org/extlink&oid=6457730&loc=d3e39549-107864 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 850 -SubTopic 10 -Section 50 -Paragraph 1 -Subparagraph (b) -URI http://asc.fasb.org/extlink&oid=6457730&loc=d3e39549-107864 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 850 -SubTopic 10 -Section 50 -Paragraph 1 -Subparagraph (a) -URI http://asc.fasb.org/extlink&oid=6457730&loc=d3e39549-107864 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 850 -URI http://asc.fasb.org/topic&trid=2122745 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 850 -SubTopic 10 -Section 50 -Paragraph 6 -URI http://asc.fasb.org/extlink&oid=6457730&loc=d3e39691-107864 + Details
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