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Note 4 - Derivative Instruments

12 Months Ended

Dec. 31, 2023

Notes to Financial Statements

Derivative Instruments and Hedging Activities Disclosure [Text Block]

4. DERIVATIVE INSTRUMENTS

Natural gas derivatives

As of December 31, 2023 and 2022 the Company held a series of call options (the "Call Options”) for the purchase of natural gas related to customer commitments. The Call Options are for a total of 0.3 million MMBtu (million British thermal units) of natural gas at December 31, 2023, and extend into the second quarter of 2024. The Company purchased the Call Options to manage the risk of increasing natural gas prices above what it can charge its customers. The Company may also enter into other derivative transactions when beneficial. The Company recognizes all of its derivative instruments as either assets or liabilities which are recorded at fair value on its Condensed Consolidated Balance Sheet. The fair value of the Call Options are predominantly determined from broker quotes and are considered a level 2 fair value measurement. The following table presents the location and fair value of the Call Options at December 31, 2023 and 2022 (in thousands):

		*For the Year Ended December 31,*
Location on Consolidated Balance Sheet		*2023*					*2022 (2)*
Prepaid expenses and other current assets (1), (2)		$	—			$	347
Right-of-use assets and other noncurrent assets (1), (2)			—				225
		$	—			$	572

(1)

Amounts are presented on a gross basis.

(2)

The classification between current and noncurrent assets is based upon when the Call Options mature.

The Company has not designated the Call Options as a hedge under U.S. GAAP and all resulting gains and losses from changes in the fair value of its derivative instruments are included within change in unrealized loss or gain on natural gas derivatives within the Company's Condensed Consolidated Statements of Operations. The table below presents the changes in the fair value of the Call Options for the years ended December 31, 2023 and 2022 as well as the net realized gains and losses for all of its derivatives for the years ended December 31, 2023 and 2022 (in thousands):

		*For the Year Ended December 31,*
Changes in fair value of derivatives		*2023*				*2022*
Fair value of natural gas derivatives, beginning of period		$	572			$	—
Purchases of natural gas derivatives			—				2,241
Realized gains (losses), net			(1,113	)			(791	)
Change in unrealized gain (loss) on natural gas derivatives (1)			541				(878	)
Fair value of natural gas derivatives, end of year		$	—			$	572

		*For the Year Ended December 31,*
Realized gain (loss) from derivative instruments		*2023*				*2022*
Realized gains (losses), net		$	(1,113	)		$	(791	)
Derivative settlement payments received			—				1,235
Derivative settlement payments made			—				(31	)
Total realized gain (loss) from natural gas derivatives, net (2)		$	(1,113	)		$	413

	(1)	Amounts are presented as their own separate line item within the Company's Consolidated Statements of Operations.
	(2)	Amounts are included within cost of revenues on the Company's Consolidated Statements of Operations.