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Fair Value Measurements | 6 Months Ended
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Jun. 30, 2023
Fair Value Disclosures [Abstract] |
Fair Value Measurements | Fair Value Measurements The FASB has established a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy consists of three broad levels. Level 1 inputs are the highest priority and consist of unadjusted quoted prices in active markets for identical assets and liabilities. Level 2 are inputs other than quoted prices that are observable for the asset or liability, either directly or indirectly. Level 3 are unobservable inputs for an asset or liability. The carrying values of financial instruments comprising cash and cash equivalents, payables, receivables, and advances from joint interest owners approximate fair values due to the short-term maturities of these instruments and are classified as Level 1 in the fair value hierarchy. The carrying value reported for the revolving line of credit approximates fair value because the underlying instruments are at interest rates which approximate current market rates. The fair value of the Senior Notes is based on estimates of current rates available for similar issues with similar maturities and is classified as Level 2 in the fair value hierarchy. The oil and natural gas properties acquired and asset retirement obligations assumed in the New Mexico Acquisition are considered Level 3 measurements. Assets and Liabilities Measured on a Recurring Basis The fair value of commodity derivatives and interest rate swaps is estimated using discounted cash flow calculations based upon forward curves and are classified as Level 2 in the fair value hierarchy. The following table presents the Company’s financial assets and liabilities that were accounted for at fair value on a recurring basis as of June 30, 2023 and December 31, 2022, by level within the fair value hierarchy:
| June 30, 2023
| Level 1 |  | Level 2 |  | Level 3 |  | Total
| (In thousands)
Financial assets: |  |  |  |  |  |  |
Commodity derivative assets | $ | — |  |  | $ | 17,221 |  |  | $ | — |  |  | $ | 17,221 |
Interest rate assets | $ | — |  |  | $ | 1,294 |  |  | $ | — |  |  | $ | 1,294 |
Financial liabilities: |  |  |  |  |  |  |
Commodity derivative liabilities | $ | — |  |  | $ | (13,169) |  |  | $ | — |  |  | $ | (13,169) |
| December 31, 2022
| Level 1 |  | Level 2 |  | Level 3 |  | Total
| (In thousands)
Financial assets: |  |  |  |  |  |  |
Commodity derivative assets | $ | — |  |  | $ | 73 |  |  | $ | — |  |  | $ | 73 |
Financial liabilities: |  |  |  |  |  |  |
Commodity derivative liabilities | $ | — |  |  | $ | (16,537) |  |  | $ | — |  |  | $ | (16,537) |
The following table summarizes the fair value and carrying amount of the Company's financial instruments.
| June 30, 2023 |  | December 31, 2022
| Carrying Amount |  | Fair Value |  | Carrying Amount |  | Fair Value
| (In thousands)
Revolving Credit Facility (Level 2) | $ | 215,000 |  |  | $ | 215,000 |  |  | $ | 56,000 |  |  | $ | 56,000 |
Senior Notes (Level 2) | $ | 179,256 |  |  | $ | 195,000 |  |  | $ | — |  |  | $ | — |
The carrying value reported for the revolving credit facility approximates fair value because the underlying instruments are at interest rates which approximate current market rates. The fair value of the Senior Notes were determined utilizing a discounted cash flow approach.

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- References No definition available. + Details
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- 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 -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482106/820-10-50-2 + Details
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