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Note 16 - Subsequent Events | 6 Months Ended
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Jun. 30, 2024
Notes to Financial Statements |
Subsequent Events [Text Block] | 16. SUBSEQUENT EVENTS Divestiture On July 9, 2024, the Company entered into a purchase and sale agreement to sell its remaining oil and gas producing properties in Karnes County, Texas including all oil and gas leases, wells and associated facilities (the "PSA"). The PSA includes a gross sales price of $6.0 million and is subject to certain adjustments to the sales price to reflect the transaction at the April 1, 2024 effective date. The PSA closed on July 31, 2024, with the Company receiving net proceeds of $5.2 million. Debt repayment The Company repaid $5.0 million of the amount owed under its credit facility with the proceeds from the sale of its properties in Karnes County Texas, which reduced the balance drawn on the credit facility to $2.0 million. Expected Write-Down of Oil and Gas Properties Under the full-cost method of accounting, the net book value of proved oil and gas properties, less related deferred income taxes, may not exceed a calculated “ceiling.” The ceiling limitation is the estimated after-tax future net cash flows from proved oil and gas reserves. Estimated future net cash flows are calculated using the unweighted arithmetic average of commodity prices in effect on the first day of each of the previous 12 months, adjusted for location and quality differentials, held flat for the life of the production (except where prices are defined by contractual arrangements), less estimated operating costs, production taxes and future development costs, all discounted at 10 percent per annum. Future cash outflows associated with settling accrued asset retirement obligations are excluded from the calculation. For the six months ended June 30, 2024, we recorded a ceiling test write-down of our oil and gas properties of $5.4 million. We expect to record a further write-down of our oil and gas properties in the third quarter of 2024 due to the sale of the Karnes County, Texas properties, which closed on July 31, 2024 and lower commodity prices used in the calculation of the ceiling test as higher third quarter 2023 commodity prices will be removed from the ceiling test calculation and replaced with what we expect to be lower third quarter 2024 commodity prices. Depending on actual commodity prices, estimated price differentials, lease operating costs, revisions to reserve estimates, and the amount and timing of capital expenditures, the write-down could be approximately $1 million to $3 million in the third quarter of 2024.

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- Definition The entire disclosure for significant events or transactions that occurred after the balance sheet date through the date the financial statements were issued or the date the financial statements were available to be issued. Examples include: the sale of a capital stock issue, purchase of a business, settlement of litigation, catastrophic loss, significant foreign exchange rate changes, loans to insiders or affiliates, and transactions not in the ordinary course of business. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 855 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/855/tableOfContent Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 855 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org/1943274/2147483399/855-10-50-2 + Details
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