XML 24 R12.htm IDEA: XBRL DOCUMENT
v3.23.1

Fair Value Measurements | 3 Months Ended
--- | ---
Mar. 31, 2023
Fair Value Disclosures [Abstract] |
Fair Value Measurements | Fair Value Measurements The Company has adopted and follows ASC 820, Fair Value Measurements and Disclosures, for measurement and disclosures about fair value of its financial instruments. ASC 820 establishes a framework for measuring fair value in U.S. GAAP, and expands disclosures about fair value measurements. To increase consistency and comparability in fair value measurements and related disclosures, ASC 820 establishes a fair value hierarchy which prioritizes the inputs to valuation techniques used to measure fair value into three (3) broad levels. The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. The three (3) levels of fair value hierarchy defined by ASC 820 are: Level 1 — Inputs are unadjusted, quoted prices in active markets for identical assets or liabilities at the measurement date. Level 2 — Inputs (other than quoted market prices included in Level 1) are either directly or indirectly observable for the asset or liability through correlation with market data at the measurement date and for the duration of the instrument’s anticipated life. Level 3 — Inputs reflect management’s best estimate of what market participants would use in pricing the asset or liability at the measurement date. Consideration is given to the risk inherent in the valuation technique and the risk inherent in the inputs to the model. Valuation of instruments includes unobservable inputs to the valuation methodology that are significant to the measurement of fair value of assets or liabilities. As defined by ASC 820, the fair value of a financial instrument is the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced or liquidation sale, which was further clarified 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. As required, financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. The Company’s assessment of the significance of a particular input requires judgment and may affect the valuation of fair value assets and liabilities and their placement within the fair value hierarchy levels. The following table presents the carrying amounts and fair values of the Company’s financial instruments as of March 31, 2023 and December 31, 2022:
| March 31, 2023 |  | December 31, 2022
(in thousands) | Carrying Value |  | Fair Value |  | Carrying Value |  | Fair Value
Assets: |  |  |  |  |  |  |
Derivative instruments - commodity derivatives | $ | 16,608 |  |  | $ | 16,608 |  |  | $ | 10,089 |  |  | $ | 10,089 |
Liabilities: |  |  |  |  |  |  |
Derivative instruments - common stock warrants | $ | 6,624 |  |  | $ | 6,624 |  |  | $ | 11,902 |  |  | $ | 11,902 |
Revolving credit facilities | $ | 25,000 |  |  | $ | 25,000 |  |  | $ | — |  |  | $ | — |
Derivative instruments - commodity derivatives | $ | 13 |  |  | $ | 13 |  |  | $ | 431 |  |  | $ | 431 |
Revolving credit facilities — The carrying amounts of the revolving credit facilities approximate their fair values, as the applicable interest rates are variable and reflective of market rates. Other financial assets and liabilities — The carrying amounts of the Company’s other financial assets and liabilities, such as revenue receivable and accrued expenses due to sellers, approximate their fair values because of the short maturity of these instruments. Derivative instruments - commodity derivatives — The fair value of the Company’s derivative instruments is estimated by management considering various factors, including closing exchange and over-the-counter quotations and the time value of the underlying commitments. The fair value of the Company’s commodity derivative instruments is considered to be a Level 2 measurement. S ubstantially all of these inputs are observable in the marketplace throughout the full term of the derivative instrument, can be derived from observable data, or supported by observable levels at which transactions are executed in the marketplace. The Company’s valuation models are primarily industry-standard models that consider various inputs including: (i) quoted forward prices for commodities, (ii) current market and contractual prices for the underlying instruments, (iii) applicable credit-adjusted risk-free rate curves, as well as other relevant economic measures. Derivative instruments - common stock warrants — The fair value of the Company’s common stock warrant liability is valued using the instrument’s publicly listed trading price as of the balance sheet date, which is considered to be a Level 1 measurement due to the use of an observable market quote in an active market. Financial assets and liabilities are classified based on the lowest level of input that is significant to the fair value measurement. The Company’s assessment of the significance of a particular input to the fair value measurement requires judgment and may affect the valuation of the fair value of assets and liabilities and their placement within the fair value hierarchy levels. The following tables summarize (i) the valuation of each of the Company’s financial instruments by required fair value hierarchy levels and (ii) the gross fair value by the appropriate balance sheet classification even when the derivative instruments are subject to netting arrangements and qualify for net presentation in the Company’s condensed consolidated balance sheets as of March 31, 2023 and December 31, 2022. The Company nets the fair value of commodity derivative instruments by counterparty in the Company’s condensed consolidated balance sheets.
| March 31, 2023
| Fair Value Measurement Using |  |  |  |  |  |
(in thousands) | Level 1 |  | Level 2 |  | Level 3 |  | Total Fair Value |  | Gross Amounts Offset in the Condensed Consolidated Balance Sheet |  | Net Fair Value Presented in the Condensed Consolidated Balance Sheet
Assets (at fair value): |  |  |  |  |  |  |  |  |  |  |
Commodity derivatives – current portion | $ | — |  |  | $ | 18,941 |  |  | $ | — |  |  | $ | 18,941 |  |  | $ | (2,333) |  |  | $ | 16,608 |
Liabilities (at fair value): |  |  |  |  |  |  |  |  |  |  |
Commodity derivatives – current portion | — |  |  | (2,346) |  |  | — |  |  | (2,346) |  |  | 2,333 |  |  | (13) |
Warrant liability – noncurrent portion | (6,624) |  |  | — |  |  | — |  |  | (6,624) |  |  | — |  |  | — |
Net derivative instruments | $ | (6,624) |  |  | $ | 16,595 |  |  | $ | — |  |  | $ | 9,971 |  |  | $ | — |  |  | $ | 16,595 |
| December 31, 2022
| Fair Value Measurement Using |  |  |  |  |  |
(in thousands) | Level 1 |  | Level 2 |  | Level 3 |  | Total Fair Value |  | Gross Amounts Offset in the Condensed Consolidated Balance Sheet |  | Net Fair Value Presented in the Condensed Consolidated Balance Sheet
Assets (at fair value): |  |  |  |  |  |  |  |  |  |  |
Commodity derivatives – current portion | $ | — |  |  | $ | 20,197 |  |  | $ | — |  |  | $ | 20,197 |  |  | $ | (10,108) |  |  | $ | 10,089 |
Liabilities (at fair value): |  |  |  |  |  |  |  |  |  |  |
Commodity derivatives – current portion | — |  |  | (10,539) |  |  | — |  |  | (10,539) |  |  | 10,108 |  |  | (431) |
Warrant liability - noncurrent portion | (11,902) |  |  | — |  |  | — |  |  | (11,902) |  |  | — |  |  | — |
Net derivative instruments | $ | (11,902) |  |  | $ | 9,658 |  |  | $ | — |  |  | $ | (2,244) |  |  | $ | — |  |  | $ | 9,658 |

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

X
- Definition The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 820 -SubTopic 10 -Section 50 -Paragraph 2 -URI https://asc.fasb.org/extlink&oid=126976982&loc=d3e19207-110258 + Details
Name: | us-gaap_FairValueDisclosuresTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration