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Summary of Significant Accounting Policies | 6 Months Ended
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Mar. 31, 2022
Accounting Policies [Abstract] |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Significant Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and accompanying notes. These estimates and assumptions may also affect disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The Company evaluates these estimates on an ongoing basis, using historical experience, consultation with experts and other methods the Company considers reasonable in the particular circumstances. Actual results may differ significantly from the Company’s estimates. Any effects on the Company’s business, financial position or results of operations resulting from revisions to these estimates are recorded in the period in which the facts that give rise to the revision become known. Significant items subject to such estimates and assumptions include, but are not limited to, estimates of proved oil and natural gas reserves and related present value estimates of future net cash flows therefrom, the carrying value of oil and natural gas properties, accounts receivable, accrued capital expenditures and operating expenses, ARO, the fair value determination of acquired assets and assumed liabilities, certain tax accruals and the fair value of derivatives. Accounts Receivable Accounts receivable is summarized below:
| March 31, 2022 |  | September 30, 2021
| (In thousands)
Oil, natural gas and NGL sales | $ | 25,379 |  |  | $ | 17,008 |
Joint interest accounts receivable | 379 |  |  | 413 |
Other accounts receivable | 24 |  |  | 52 |
Total accounts receivable | $ | 25,782 |  |  | $ | 17,473 |
The Company had no allowance for doubtful accounts at March 31, 2022 and September 30, 2021. Other Non-Current Assets, Net Other non-current assets consisted of the following:
| March 31, 2022 |  | September 30, 2021
| (In thousands)
Deferred financing costs, net | $ | 1,179 |  |  | $ | 1,353 |
Prepayments to outside operators | 594 |  |  | 707 |
Right of use assets | 106 |  |  | 309 |
Other deposits | 50 |  |  | 50 |
Total other non-current assets, net | $ | 1,929 |  |  | $ | 2,419 |
Accrued Liabilities Accrued liabilities consisted of the following:
| March 31, 2022 |  | September 30, 2021
| (In thousands)
Accrued capital expenditures | $ | 15,520 |  |  | $ | 9,718 |
Accrued lease operating expenses | 2,692 |  |  | 2,428 |
Accrued general and administrative costs | 2,363 |  |  | 3,575 |
Other accrued expenditures | 1,396 |  |  | 2,834 |
Total accrued liabilities | $ | 21,971 |  |  | $ | 18,555 |
Asset Retirement Obligations Components of the changes in ARO for the six months ended March 31, 2022 and year ended September 30, 2021 are shown below:
| March 31, 2022 |  | September 30, 2021
| (In thousands)
ARO, beginning balance | $ | 2,434 |  |  | $ | 2,326 |
Liabilities incurred | 93 |  |  | 113 |
Liability settlements and disposals | (190) |  |  | (92) |
Accretion | 46 |  |  | 87 |
ARO, ending balance | 2,383 |  |  | 2,434 |
Less: current ARO(1) | (146) |  |  | (128) |
ARO, long-term | $ | 2,237 |  |  | $ | 2,306 |
_____________________ (1)Current ARO is included within other current liabilities on the accompanying condensed consolidated balance sheets. Goodwill At the closing of the Merger, the Company determined it had two reporting units, and the entire goodwill balance was included in the reporting unit acquired in the Merger (the "Kansas Reporting Unit"). The Company did not fully integrate the Kansas Reporting Unit in the Company's operations as it was deemed to be held for sale upon acquisition. The Company assessed the goodwill balance for impairment since the Company entered into a purchase and sale agreement ("PSA") in March 2021 for $3.5 million before closing adjustments. As the carrying value exceeded the implied fair value at the time of the closing of the Merger, the Company concluded the goodwill balance associated with the Kansas Reporting Unit was impaired and recognized a goodwill impairment loss, included within loss from discontinued operations on the condensed consolidated statement of operations, of $18.5 million for the three and six months ended March 31, 2021. See further discussion in Note 12 - Discontinued Operations and Assets Held for Sale. Revenue Recognition The following table presents oil and natural gas sales disaggregated by product:
| Three Months Ended March 31, |  | Six Months Ended March 31,
| 2022 |  | 2021 |  | 2022 |  | 2021
| (In thousands)
Oil and natural gas sales: |  |  |  |  |  |  |
Oil | $ | 62,376 |  |  | $ | 30,784 |  |  | $ | 112,999 |  |  | $ | 52,891 |
Natural gas | 1,789 |  |  | 4,516 |  |  | 4,494 |  |  | 4,635 |
Natural gas liquids | 2,480 |  |  | 1,359 |  |  | 5,802 |  |  | 1,547 |
Total oil and natural gas sales, net | $ | 66,645 |  |  | $ | 36,659 |  |  | $ | 123,295 |  |  | $ | 59,073 |
Recent Accounting Pronouncements Recently Adopted Accounting Pronouncements In December 2019, the FASB issued ASU No. 2019-12, "Income Taxes (Topic 740) - Simplifying the Accounting for Income Taxes." This update is intended to simplify the accounting for income taxes by removing certain exceptions and by clarifying and amending existing guidance and is effective for public business entities beginning after December 15, 2020 with early adoption permitted. The Company adopted this ASU effective October 1, 2021. The adoption of this ASU did not have a material impact on the Company's condensed consolidated financial statements. Issued Accounting Standards Not Yet Adopted In March 2020, the FASB issued ASU No. 2020-04, “Reference Rate Reform (Topic 840): Facilitation of the Effects of Reference Rate Reform on Financial Reporting” (“ASU 2020-04”), which provides companies with optional guidance to ease the potential accounting burden associated with transitioning away from reference rates (e.g., LIBOR) that are expected to be discontinued. ASU 2020-04 allows, among other things, certain contract modifications, such as those within the scope of Topic 470 on debt, to be accounted as a continuation of the existing contract. This ASU was effective upon the issuance and its optional relief can be applied through December 31, 2022.

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- Definition The entire disclosure for all significant accounting policies of the reporting entity. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=123372394&loc=d3e18726-107790 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -URI http://asc.fasb.org/topic&trid=2122369 + Details
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