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Note 2 - Net Profits Interest Divestiture

3 Months Ended

Mar. 31, 2021

Net Profits Interests Divestiture [Text Block]

2.	Net Profits Interest Divestiture

On September 30, 2020, the Partnership and affiliates of its General Partner closed the divestiture of our Hugoton net profits interest located in Texas County, Oklahoma and Stevens County, Kansas to a third party. In accordance with the full cost method of accounting, as the divestiture did not represent a significant portion of the Partnership’s reserves, gross divestiture proceeds of $5.7 million were credited to the oil and natural gas properties full cost pool as of December 31, 2020. Final net proceeds from the sale were subject to customary holdbacks and post-closing adjustments. Customary holdbacks of $0.2 million were paid to the Partnership during the first quarter of 2021 and are included in proceeds from the sale of oil and natural gas properties on the condensed consolidated statement of cash flows for the three months ended March 31, 2021.