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Fair Value Measurements

6 Months Ended

Jun. 30, 2025

Fair Value Disclosures [Abstract]

Fair Value Measurements

17. Fair Value Measurements

​

The methodologies used to determine the fair value of our financial assets and liabilities at June 30, 2025 were the same as those used at December 31, 2024.

​

Cash and cash equivalents, restricted cash, accounts receivable, and accounts payable are carried at cost, which approximates their fair value because of the short-term maturity of these instruments. The Company’s revolving line of credit has a recorded value that approximates its fair value since its variable interest rate is tied to current market rates and the applicable margins represent market rates. The revolving line of credit is classified within Level 2 of the fair value hierarchy.

​

Commodity derivative instruments consist of NYMEX HH swap, NYMEX HH option, and Tennessee Z4 basis swap contracts for natural gas, and NYMEX WTI CMA swap contracts for crude oil. The Company’s derivative contracts are valued based on a marked to market approach. These assumptions are observable in the marketplace throughout the full term of the contract, can be derived from observable data or are supported by observable levels at which transactions are executed in the marketplace, and are therefore designated as Level 2 within the valuation hierarchy. The Company utilizes its counterparties’ valuations to assess the reasonableness of its own valuations.

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​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

June 30, 2025

​

Level 1

​

Level 2

Level 3

Effect of Netting

Net Fair Value

Assets

​

​

​

​

​

​

​

​

​

​

Derivative contracts

​

$

—

​

$

1,348,294

​

$

—

​

$

(615,766)

​

$

732,528

Cash equivalents

​

$

261,512

​

$

—

​

$

—

​

$

—

​

$

261,512

Liabilities

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Derivative contracts

​

$

—

​

$

615,766

​

$

—

​

$

(615,766)

​

$

—

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

December 31, 2024

​

​

Level 1

​

Level 2

Level 3

Effect of Netting

Net Fair Value

Assets

​

​

​

​

​

​

​

​

​

​

Derivative contracts

​

$

—

​

$

403,032

​

$

—

​

$

(403,032)

​

$

—

Cash equivalents

​

$

298,767

​

$

—

​

$

—

​

$

—

​

$

298,767

Liabilities

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Derivative contracts

​

$

—

​

$

890,580

​

$

—

​

$

(403,032)

​

$

487,548

​

​

​

Non-Recurring Fair Value Measurements

​

The Company performed an impairment test on our oil and gas properties and it was determined that the carrying amount of the Canada asset exceeded the estimated undiscounted future cash flows resulting in a reduction of the carrying amount of the properties to their estimated fair values by $2.7 million. This nonrecurring fair value measurement is classified within Level 3 of the fair value hierarchy. For the year ended December 31, 2024, there was an impairment of $1.45 million.

​

The table below summarizes the fair value of the impaired assets at June 30, 2025.

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Quoted Prices

​

Significant

​

​

​

​

​

​

in Active

​

Other

​

Significant

​

​

​

​

Markets for

​

Observable

​

Unobservable

​

​

June 30,

​

Identical Assets

​

Inputs

​

Inputs

​

​

2025

(Level 1)

(Level 2)

(Level 3)

Nonrecurring fair value measurement

​

​

​

​

​

​

​

​

​

​

​

​

Long-lived assets held and used

​

$

1,342,942

​

$

—

​

$

—

​

$

1,342,942

Total Nonrecurring fair value measurement

​

$

1,342,942

​

$

—

​

$

—

​

$

1,342,942

​

The table below summarizes the fair value of the impaired assets at December 31, 2024.

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Quoted Prices

​

Significant

​

​

​

​

​

​

in Active

​

Other

​

Significant

​

​

​

​

Markets for

​

Observable

​

Unobservable

​

​

December 31,

​

Identical Assets

​

Inputs

​

Inputs

​

​

2024

(Level 1)

(Level 2)

(Level 3)

Nonrecurring fair value measurement

​

​

​

​

​

​

​

​

​

​

​

​

Long-lived assets held and used

​

$

492,253

​

$

—

​

$

—

​

$

492,253

Total Nonrecurring fair value measurement

​

$

492,253

​

$

—

​

$

—

​

$

492,253

​

X

- References

No definition available.

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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

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-Topic 820
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-Name Accounting Standards Codification
-Section 55
-Paragraph 107
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482078/820-10-55-107

Reference 2: http://www.xbrl.org/2003/role/exampleRef
-Topic 820
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-URI https://asc.fasb.org/1943274/2147482078/820-10-55-100

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
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-Topic 940
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