XML 97 R13.htm IDEA: XBRL DOCUMENT
v3.25.0.1

Derivatives | 6 Months Ended
--- | ---
Dec. 31, 2024
Derivatives |
Derivatives | Note 7. Derivatives The Company is exposed to certain risks relating to its ongoing business operations, including commodity price risk and interest rate risk. In accordance with the Company’s strategy and the requirements under the Senior Secured Credit Facility (as discussed in Note 5, “Senior Secured Credit Facility”), it may hedge or may be required to hedge a varying portion of anticipated oil and natural gas production for future periods. Derivatives are carried at fair value on the unaudited condensed consolidated balance sheets as assets or liabilities, with the changes in the fair value included in the unaudited condensed consolidated statements of operations for the period in which the change occurs. The Company’s hedge strategies and objectives may change significantly as its operational profile changes or as required under the Senior Secured Credit Facility. The Company does not enter into derivative contracts for speculative trading purposes. It is the Company’s policy to enter into derivative contracts only with counterparties that are creditworthy financial or commodity hedging institutions deemed by management as competent and competitive market makers. As of December 31, 2024, the Company did not post collateral under any of its derivative contracts during the periods in which contracts were open as they were secured under the Company’s Senior Secured Credit Facility. When the Company utilizes commodity derivative contracts, it expects to enter into deferred premium puts, costless put/call collars, fixed-price swaps, and/or basis swaps to hedge a portion of its anticipated future production. A costless collar consists of a sold call, which establishes a maximum price the Company will receive for the volumes under contract, and a purchased put that establishes a minimum price. Fixed-price swaps are designed so that the Company receives or makes payments based on a differential between fixed and variable prices for the volumes under contract. Basis swaps effectively lock in a price differential between regional prices (i.e., Inside FERC’s Northwest Pipeline Corp Rocky Mountains) where the product is sold and the relevant pricing index under which the natural gas production is hedged (i.e., NYMEX Henry Hub). The Company has elected not to designate its open derivative contracts for hedge accounting. Accordingly, the Company records the net change in the mark-to-market valuation of the derivative contracts and all payments and receipts on settled derivative contracts in “Net gain (loss) on derivative contracts” on the unaudited condensed consolidated statements of operations. All derivative contracts are recorded at fair market value in accordance with ASC 815, Derivatives and Hedging (“ASC 815”) and ASC 820, Fair Value Measurement (“ASC 820”) and included in the unaudited condensed consolidated balance sheets as assets or liabilities. The “Derivative contract assets” and “Derivative contract liabilities” represent the difference between the market commodity prices and the hedged prices for the remaining volumes of production hedges as of December 31, 2024 and June 30, 2024 (the “mark-to-market valuation”). The following table summarizes the location and fair value amounts of all derivative contracts in the unaudited condensed consolidated balance sheets as of December 31, 2024 and June 30, 2024 (in thousands):
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Derivatives not designated | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
as hedging contracts | ​ | Balance sheet | ​ | Derivative Contract Assets | ​ | Balance sheet | ​ | Derivative Contract Liabilities
under ASC 815 |  | location |  | December 31, 2024 |  | June 30, 2024 |  | location |  | December 31, 2024 |  | June 30, 2024
Commodity contracts | ​ | Current assets – derivative contract assets | ​ | $ | 1,073 | ​ | $ | 596 | ​ | Current liabilities – derivative contract liabilities | ​ | $ | 439 | ​ | $ | 1,192
Commodity contracts | ​ | Other assets – derivative contract assets | ​ | ​ | 250 | ​ | ​ | 171 | ​ | Long term liabilities – derivative contract liabilities | ​ | ​ | 1,277 | ​ | ​ | 468
Total derivatives not designated as hedging contracts under ASC 815 | ​ | ​ | ​ | $ | 1,323 | ​ | $ | 767 | ​ | ​ | ​ | $ | 1,716 | ​ | $ | 1,660
​ ​ The following table summarizes the location and amounts of the Company’s realized and unrealized gains and losses on derivative contracts in the Company’s unaudited condensed consolidated statements of operations for the three and six months ended December 31, 2024 and 2023 (in thousands). “Realized gain (loss) on derivative contracts” represents all receipts (payments) on derivative contracts settled during the period. “Unrealized gain (loss) on derivative contracts” represents the net change in the mark-to-market valuation of the derivative contracts. ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Derivatives not designated | ​ | Location of gain (loss) | ​ | Three Months Ended | ​ | Six Months Ended
as hedging contracts | ​ | recognized in income on | ​ | December 31, | ​ | December 31,
under ASC 815 |  | derivative contracts |  | 2024 | ​ | 2023 | ​ | 2024 |  | 2023
Commodity contracts: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Realized gain (loss) on derivative contracts | ​ | Other income and expenses – net gain (loss) on derivative contracts | ​ | $ | 149 | ​ | $ | — | ​ | $ | 79 | ​ | $ | —
Unrealized gain (loss) on derivative contracts | ​ | Other income and expenses – net gain (loss) on derivative contracts | ​ | ​ | (1,368) | ​ | ​ | — | ​ | ​ | 500 | ​ | ​ | —
Total net gain (loss) on derivative contracts | ​ | ​ | ​ | $ | (1,219) | ​ | $ | — | ​ | $ | 579 | ​ | $ | —
​ ​ As of December 31, 2024, the Company had the following open crude oil and natural gas derivative contracts: ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | ​ | Volumes in | ​ | Swap Price per | ​ | Floor Price per | ​ | Ceiling Price per
Period |  | Commodity | ​ | Instrument |  | MMBTU/BBL | ​ | MMBTU/BBL |  | MMBTU/BBL |  | MMBTU/BBL
January 2025 - March 2025 | ​ | Crude Oil | ​ | Collar | ​ | 42,566 | ​ | ​ | ​ | ​ | $ | 68.00 | ​ | $ | 73.77
January 2025 - June 2025 | ​ | Crude Oil | ​ | Fixed-Price Swap | ​ | 51,992 | ​ | $ | 73.49 | ​ | ​ | ​ | ​ | ​ | ​
April 2025 - June 2025 | ​ | Crude Oil | ​ | Collar | ​ | 41,601 | ​ | ​ | ​ | ​ | ​ | 65.00 | ​ | ​ | 84.00
July 2025 - December 2025 | ​ | Crude Oil | ​ | Fixed-Price Swap | ​ | 81,335 | ​ | ​ | 71.40 | ​ | ​ | ​ | ​ | ​ | ​
January 2025 - February 2025 | ​ | Natural Gas | ​ | Fixed-Price Swap | ​ | 312,286 | ​ | ​ | 3.56 | ​ | ​ | ​ | ​ | ​ | ​
January 2025 - March 2025 | ​ | Natural Gas | ​ | Basis Swap | ​ | 305,607 | ​ | ​ | 0.66 | ​ | ​ | ​ | ​ | ​ | ​
March 2025 - December 2026 | ​ | Natural Gas | ​ | Fixed-Price Swap | ​ | 3,170,705 | ​ | ​ | 3.60 | ​ | ​ | ​ | ​ | ​ | ​
January 2026 - March 2026 | ​ | Natural Gas | ​ | Collar | ​ | 375,481 | ​ | ​ | ​ | ​ | ​ | 3.60 | ​ | ​ | 5.00
April 2025 - December 2027 | ​ | Natural Gas | ​ | Fixed-Price Swap | ​ | 3,729,540 | ​ | ​ | 3.57 | ​ | ​ | ​ | ​ | ​ | ​
Subsequent to December 31, 2024, the Company entered into the following new crude oil derivative contracts:
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | ​ | Volumes in | ​ | Swap Price per | ​ | Floor Price per | ​ | Ceiling Price per
Period |  | Commodity | ​ | Instrument |  | MMBTU/BBL | ​ | MMBTU/BBL |  | MMBTU/BBL |  | MMBTU/BBL
February 2025 - March 2025 | ​ | Crude Oil | ​ | Put | ​ | 3,277 | ​ | ​ | ​ | ​ | $ | 75.00 | ​ | ​ | ​
February 2025 - March 2025 | ​ | Crude Oil | ​ | Fixed-Price Swap | ​ | 3,278 | ​ | $ | 71.02 | ​ | ​ | ​ | ​ | ​ | ​
April 2025 - December 2025 | ​ | Crude Oil | ​ | Fixed-Price Swap | ​ | 32,229 | ​ | ​ | 72.00 | ​ | ​ | ​ | ​ | ​ | ​
January 2026 - March 2026 | ​ | Crude Oil | ​ | Collar | ​ | 43,493 | ​ | ​ | ​ | ​ | ​ | 60.00 | ​ | ​ | 75.80
​ The Company presents the fair value of its derivative contracts at the gross amounts in the unaudited condensed consolidated balance sheets. The following table shows the potential effects of master netting arrangements on the fair value of the Company’s derivative contracts as of December 31, 2024 and June 30, 2024 (in thousands): ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Derivative Contracts Assets | ​ | Derivative Contracts Liabilities
Offsetting of Derivative Assets and Liabilities |  | December 31, 2024 |  | June 30, 2024 |  | December 31, 2024 |  | June 30, 2024
Gross amounts presented in the Consolidated Balance Sheet | ​ | $ | 1,323 | ​ | $ | 767 | ​ | $ | 1,716 | ​ | $ | 1,660
Amounts not offset in the Consolidated Balance Sheet | ​ | ​ | (688) | ​ | ​ | (497) | ​ | ​ | (688) | ​ | ​ | (497)
Net amount | ​ | $ | 635 | ​ | $ | 270 | ​ | $ | 1,028 | ​ | $ | 1,163
​ The Company enters into an International Swap Dealers Association Master Agreements (“ISDA”) with each counterparty prior to a derivative contract with such counterparty. The ISDA is a standard contract that governs all derivative contracts entered into between the Company and the respective counterparty. The ISDA allows for offsetting of amounts payable or receivable between the Company and the counterparty, at the election of both parties, for transactions that occur on the same date and in the same currency.

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

X
- Definition The entire disclosure for derivative instruments and hedging activities including, but not limited to, risk management strategies, non-hedging derivative instruments, assets, liabilities, revenue and expenses, and methodologies and assumptions used in determining the amounts. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 815 -SubTopic 40 -Name Accounting Standards Codification -Section 50 -Paragraph 5 -Subparagraph (f) -Publisher FASB -URI https://asc.fasb.org/1943274/2147480237/815-40-50-5 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 815 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 5C -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org/1943274/2147480434/815-10-50-5C Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 815 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/815/tableOfContent + Details
Name: | us-gaap_DerivativeInstrumentsAndHedgingActivitiesDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration