FORM |
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) | |||||||
(Address of Principal Executive Offices) | (Zip Code) |
Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||
Large accelerated filer | o | x | |||||||||
Non-accelerated filer | o | Smaller reporting company | |||||||||
Emerging growth company |
RILEY EXPLORATION PERMIAN, INC. | ||||||||
FORM 10-Q | ||||||||
QUARTERLY REPORT ON FORM 10-Q FOR THE QUARTER ENDED SEPTEMBER 30, 2023 | ||||||||
TABLE OF CONTENTS | ||||||||
Page | ||||||||
Measurements. | |||||
Bbl | One barrel or 42 U.S. gallons liquid volume of oil or other liquid hydrocarbons | ||||
Boe | One stock tank barrel equivalent of oil, calculated by converting gas volumes to equivalent oil barrels at a ratio of 6 thousand cubic feet of gas to 1 barrel of oil and by converting NGL volumes to equivalent oil barrels at a ratio of 1 barrel of NGL to 1 barrel of oil | ||||
Boe/d | Stock tank barrel equivalent of oil per day | ||||
Btu | British thermal unit. One British thermal unit is the amount of heat required to raise the temperature of one pound of water by one degree Fahrenheit | ||||
MBbl | One thousand barrels of oil or other liquid hydrocarbons | ||||
MBoe | One thousand Boe | ||||
MBoe/d | One thousand Boe per day | ||||
Mcf | One thousand cubic feet of gas | ||||
MMcf | One million cubic feet of gas | ||||
Abbreviations. | |||||
ARO | Asset Retirement Obligation | ||||
ATM | At-the-market equity sales program | ||||
CME | Chicago Mercantile Exchange | ||||
CO2 | Carbon Dioxide | ||||
EOR | Enhanced Oil Recovery | ||||
FASB | Financial Accounting Standards Board | ||||
NGL | Natural gas liquids | ||||
NYSE | New York Stock Exchange | ||||
Oil | Crude oil and condensate | ||||
RRC | Railroad Commission of Texas | ||||
SEC | Securities and Exchange Commission | ||||
U.S. GAAP | Accounting principles generally accepted in the United States of America | ||||
WTI | West Texas Intermediate | ||||
RILEY EXPLORATION PERMIAN, INC. | ||||||||||||||
CONDENSED CONSOLIDATED BALANCE SHEETS | ||||||||||||||
(Unaudited) | ||||||||||||||
September 30, 2023 | December 31, 2022 | |||||||||||||
(In thousands, except share amounts) | ||||||||||||||
Assets | ||||||||||||||
Current Assets: | ||||||||||||||
Cash and cash equivalents | $ | $ | ||||||||||||
Accounts receivable | ||||||||||||||
Prepaid expenses and other current assets | ||||||||||||||
Inventory | ||||||||||||||
Current derivative assets | ||||||||||||||
Total current assets | ||||||||||||||
Oil and natural gas properties, net (successful efforts) | ||||||||||||||
Other property and equipment, net | ||||||||||||||
Non-current derivative assets | ||||||||||||||
Other non-current assets, net | ||||||||||||||
Total Assets | $ | $ | ||||||||||||
Liabilities and Shareholders' Equity | ||||||||||||||
Current Liabilities: | ||||||||||||||
Accounts payable | $ | $ | ||||||||||||
Accrued liabilities | ||||||||||||||
Revenue payable | ||||||||||||||
Current derivative liabilities | ||||||||||||||
Current portion of long-term debt | ||||||||||||||
Other current liabilities | ||||||||||||||
Total Current Liabilities | ||||||||||||||
Non-current derivative liabilities | ||||||||||||||
Asset retirement obligations | ||||||||||||||
Long-term debt | ||||||||||||||
Deferred tax liabilities | ||||||||||||||
Other non-current liabilities | ||||||||||||||
Total Liabilities | ||||||||||||||
Commitments and Contingencies (Note 13) | ||||||||||||||
Shareholders' Equity: | ||||||||||||||
Preferred stock, $ | ||||||||||||||
Common stock, $ | ||||||||||||||
Additional paid-in capital | ||||||||||||||
Retained earnings | ||||||||||||||
Total Shareholders' Equity | ||||||||||||||
Total Liabilities and Shareholders' Equity | $ | $ |
RILEY EXPLORATION PERMIAN, INC. | ||||||||||||||||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||||||||||||||||||||
(Unaudited) | ||||||||||||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | |||||||||||||||||||||||
(In thousands, except per share amounts) | ||||||||||||||||||||||||||
Revenues: | ||||||||||||||||||||||||||
Oil and natural gas sales, net | $ | $ | $ | $ | ||||||||||||||||||||||
Contract services - related parties | ||||||||||||||||||||||||||
Total Revenues | ||||||||||||||||||||||||||
Costs and Expenses: | ||||||||||||||||||||||||||
Lease operating expenses | ||||||||||||||||||||||||||
Production and ad valorem taxes | ||||||||||||||||||||||||||
Exploration costs | ||||||||||||||||||||||||||
Depletion, depreciation, amortization and accretion | ||||||||||||||||||||||||||
General and administrative: | ||||||||||||||||||||||||||
Administrative costs | ||||||||||||||||||||||||||
Share-based compensation expense | ||||||||||||||||||||||||||
Cost of contract services - related parties | ||||||||||||||||||||||||||
Transaction costs | ||||||||||||||||||||||||||
Total Costs and Expenses | ||||||||||||||||||||||||||
Income From Operations | ||||||||||||||||||||||||||
Other Income (Expense): | ||||||||||||||||||||||||||
Interest expense, net | ( | ( | ( | ( | ||||||||||||||||||||||
Gain (loss) on derivatives | ( | ( | ( | |||||||||||||||||||||||
Gain (loss) from equity method investment | ( | |||||||||||||||||||||||||
Total Other Income (Expense) | ( | ( | ( | |||||||||||||||||||||||
Net Income From Operations Before Income Taxes | ||||||||||||||||||||||||||
Income tax expense | ( | ( | ( | ( | ||||||||||||||||||||||
Net Income | $ | $ | $ | $ | ||||||||||||||||||||||
Net Income per Share: | ||||||||||||||||||||||||||
Basic | $ | $ | $ | $ | ||||||||||||||||||||||
Diluted | $ | $ | $ | $ | ||||||||||||||||||||||
Weighted Average Common Shares Outstanding: | ||||||||||||||||||||||||||
Basic | ||||||||||||||||||||||||||
Diluted |
RILEY EXPLORATION PERMIAN, INC. | ||||||||||||||||||||||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY | ||||||||||||||||||||||||||||||||
(Unaudited) | ||||||||||||||||||||||||||||||||
(In Thousands) | ||||||||||||||||||||||||||||||||
Shareholders' Equity | ||||||||||||||||||||||||||||||||
Common Stock | ||||||||||||||||||||||||||||||||
Shares | Amount | Additional Paid-in Capital | Retained Earnings | Total Shareholders' Equity | ||||||||||||||||||||||||||||
Balance, December 31, 2022 | $ | $ | $ | $ | ||||||||||||||||||||||||||||
Share-based compensation expense | — | — | ||||||||||||||||||||||||||||||
Repurchased shares for tax withholding | ( | — | ( | — | ( | |||||||||||||||||||||||||||
Dividends declared | — | — | — | ( | ( | |||||||||||||||||||||||||||
Net income | — | — | — | |||||||||||||||||||||||||||||
Balance, March 31, 2023 | $ | $ | $ | $ | ||||||||||||||||||||||||||||
Share-based compensation expense | — | — | ||||||||||||||||||||||||||||||
Repurchased shares for tax withholding | ( | — | ( | — | ( | |||||||||||||||||||||||||||
Dividends declared | — | — | — | ( | ( | |||||||||||||||||||||||||||
Net income | — | — | — | |||||||||||||||||||||||||||||
Balance, June 30, 2023 | $ | $ | $ | $ | ||||||||||||||||||||||||||||
Share-based compensation expense | ( | — | — | |||||||||||||||||||||||||||||
Repurchased shares for tax withholding | ( | — | ( | — | ( | |||||||||||||||||||||||||||
Issuance of common shares under ATM | — | — | ||||||||||||||||||||||||||||||
Dividends declared | — | — | — | ( | ( | |||||||||||||||||||||||||||
Net income | — | — | — | |||||||||||||||||||||||||||||
Balance, September 30, 2023 | $ | $ | $ | $ | ||||||||||||||||||||||||||||
Shareholders' Equity | ||||||||||||||||||||||||||||||||
Common Stock | ||||||||||||||||||||||||||||||||
Shares | Amount | Additional Paid-in Capital | Accumulated Deficit | Total Shareholders' Equity | ||||||||||||||||||||||||||||
Balance, December 31, 2021 | $ | $ | $ | ( | $ | |||||||||||||||||||||||||||
Share-based compensation expense | — | — | — | |||||||||||||||||||||||||||||
Repurchased shares for tax withholding | ( | — | ( | — | ( | |||||||||||||||||||||||||||
Issuance of common shares under long-term incentive plan, net | — | — | — | — | ||||||||||||||||||||||||||||
Dividends declared | — | — | — | ( | ( | |||||||||||||||||||||||||||
Net loss | — | — | — | ( | ( | |||||||||||||||||||||||||||
Balance, March 31, 2022 | $ | $ | $ | ( | $ | |||||||||||||||||||||||||||
Share-based compensation expense | — | — | — | |||||||||||||||||||||||||||||
Repurchased shares for tax withholding | ( | — | ( | — | ( | |||||||||||||||||||||||||||
Issuance of common shares under long-term incentive plan | — | — | — | — | ||||||||||||||||||||||||||||
Dividends declared | — | — | — | ( | ( | |||||||||||||||||||||||||||
Net income | — | — | — | |||||||||||||||||||||||||||||
Balance, June 30, 2022 | $ | $ | $ | ( | $ | |||||||||||||||||||||||||||
Share-based compensation expense, net | — | — | — | |||||||||||||||||||||||||||||
Repurchased shares for tax withholding | — | ( | — | ( | ||||||||||||||||||||||||||||
Issuance of common shares under long-term incentive plan, net | — | — | — | — | ||||||||||||||||||||||||||||
Dividends declared | — | — | — | ( | ( | |||||||||||||||||||||||||||
Net income | — | — | — | |||||||||||||||||||||||||||||
Balance, September 30, 2022 | $ | $ | $ | $ | ||||||||||||||||||||||||||||
RILEY EXPLORATION PERMIAN, INC. | ||||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||||||||||||
(Unaudited) | ||||||||||||||
Nine Months Ended September 30, | ||||||||||||||
2023 | 2022 | |||||||||||||
(In thousands) | ||||||||||||||
Cash Flows from Operating Activities: | ||||||||||||||
Net income | $ | $ | ||||||||||||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||||||||
Oil and natural gas lease expirations | ||||||||||||||
Depletion, depreciation, amortization and accretion | ||||||||||||||
(Gain) loss on derivatives | ||||||||||||||
Settlements on derivative contracts | ( | ( | ||||||||||||
Amortization of deferred financing costs and discount | ||||||||||||||
Share-based compensation expense | ||||||||||||||
Deferred income tax expense | ||||||||||||||
Other | ||||||||||||||
Changes in operating assets and liabilities | ||||||||||||||
Accounts receivable | ( | ( | ||||||||||||
Prepaid expenses and other current assets | ( | |||||||||||||
Accounts payable and accrued liabilities | ||||||||||||||
Inventory | ( | |||||||||||||
Revenue payable | ||||||||||||||
Other current liabilities | ( | |||||||||||||
Net Cash Provided by Operating Activities | ||||||||||||||
Cash Flows from Investing Activities: | ||||||||||||||
Additions to oil and natural gas properties | ( | ( | ||||||||||||
Net assets acquired in business combination | ( | |||||||||||||
Acquisitions of oil and natural gas properties | ( | |||||||||||||
Contributions to equity method investment | ( | |||||||||||||
Additions to other property and equipment | ( | ( | ||||||||||||
Net Cash Used in Investing Activities | ( | ( | ||||||||||||
Cash Flows from Financing Activities: | ||||||||||||||
Deferred financing costs | ( | ( | ||||||||||||
Proceeds from revolving credit facility | ||||||||||||||
Repayments under revolving credit facility | ( | ( | ||||||||||||
Proceeds from Senior Notes, net of discount | ||||||||||||||
Repayments of Senior Notes | ( | |||||||||||||
Payment of common share dividends | ( | ( | ||||||||||||
Proceeds from issuance of common stock, net of issuance costs | ||||||||||||||
Common stock repurchased for tax withholding | ( | ( | ||||||||||||
Net Cash Provided by (Used in) Financing Activities | ( | |||||||||||||
Net Increase (Decrease) in Cash and Cash Equivalents | ( | |||||||||||||
Cash and Cash Equivalents, Beginning of Period | ||||||||||||||
Cash and Cash Equivalents, End of Period | $ | $ |
RILEY EXPLORATION PERMIAN, INC. | ||||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - (Continued) | ||||||||||||||
(Unaudited) | ||||||||||||||
Nine Months Ended September 30, | ||||||||||||||
2023 | 2022 | |||||||||||||
(In thousands) | ||||||||||||||
Supplemental Disclosure of Cash Flow Information | ||||||||||||||
Cash Paid For: | ||||||||||||||
Interest, net of capitalized interest | $ | $ | ||||||||||||
Income taxes | $ | $ | ||||||||||||
Non-cash Investing and Financing Activities: | ||||||||||||||
Changes in capital expenditures in accounts payable and accrued liabilities | $ | ( | $ | |||||||||||
Right of use assets obtained in exchange for operating lease liability | $ | ( | $ | |||||||||||
Assets contributed to equity method investment | $ | $ | ||||||||||||
Asset retirement obligations assumed in acquisitions | $ | $ |
September 30, 2023 | December 31, 2022 | ||||||||||
(In thousands) | |||||||||||
Oil, natural gas and NGL sales | $ | $ | |||||||||
Joint interest accounts receivable | |||||||||||
Other accounts receivable | |||||||||||
Total accounts receivable | $ | $ | |||||||||
September 30, 2023 | December 31, 2022 | ||||||||||
(In thousands) | |||||||||||
Deferred financing costs, net (1) | $ | $ | |||||||||
Right of use assets | |||||||||||
Equity method investment | |||||||||||
Other | |||||||||||
Total other non-current assets, net | $ | $ |
September 30, 2023 | December 31, 2022 | ||||||||||
(In thousands) | |||||||||||
Accrued capital expenditures | $ | $ | |||||||||
Accrued lease operating expenses | |||||||||||
Accrued general and administrative costs | |||||||||||
Accrued inventory | |||||||||||
Accrued ad valorem tax | |||||||||||
Other accrued expenditures | |||||||||||
Total accrued liabilities | $ | $ |
September 30, 2023 | December 31, 2022 | ||||||||||
(In thousands) | |||||||||||
Advances from joint interest owners | $ | $ | |||||||||
Income taxes payable | |||||||||||
Current ARO liabilities | |||||||||||
Lease liabilities | |||||||||||
Accounts payable - related parties | |||||||||||
Total other current liabilities | $ | $ |
September 30, 2023 | December 31, 2022 | ||||||||||
(In thousands) | |||||||||||
ARO, beginning balance | $ | $ | |||||||||
Liabilities incurred | |||||||||||
Liabilities assumed in acquisitions | |||||||||||
Revision of estimated obligations | |||||||||||
Liability settlements and disposals | ( | ( | |||||||||
Accretion | |||||||||||
ARO, ending balance | |||||||||||
Less: current ARO (1) | ( | ( | |||||||||
ARO, long-term | $ | $ |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||
Oil and natural gas sales: | |||||||||||||||||||||||
Oil | $ | $ | $ | $ | |||||||||||||||||||
Natural gas | |||||||||||||||||||||||
Natural gas liquids | |||||||||||||||||||||||
Total oil and natural gas sales, net | $ | $ | $ | $ |
Preliminary purchase price allocation as of September 30, 2023 (in thousands): | |||||
Total cash consideration | $ | ||||
Assets acquired: | |||||
Inventory | $ | ||||
Oil and natural gas properties | |||||
Amount attributable to assets acquired | $ | ||||
Fair value of liabilities assumed: | |||||
Revenue payable | $ | ||||
Asset retirement obligations | |||||
Amount attributable to liabilities assumed | $ | ||||
Net assets acquired | $ |
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | |||||||||||||||||||||||
(In thousands, except per share amounts) | ||||||||||||||||||||||||||
Total revenues | $ | $ | $ | $ | ||||||||||||||||||||||
Net income | $ | $ | $ | $ | ||||||||||||||||||||||
Basic net income per common share | $ | $ | $ | $ | ||||||||||||||||||||||
Diluted net income per common share | $ | $ | $ | $ |
September 30, 2023 | December 31, 2022 | ||||||||||
(In thousands) | |||||||||||
Proved | $ | $ | |||||||||
Unproved | |||||||||||
Work-in-progress | |||||||||||
Accumulated depletion, amortization and impairment | ( | ( | |||||||||
Total oil and natural gas properties, net | $ | $ |
Weighted Average Price | ||||||||||||||||||||||||||
Calendar Quarter / Year | Notional Volume | Fixed | Put | Call | ||||||||||||||||||||||
($ per unit) | ||||||||||||||||||||||||||
Oil Swaps (Bbl) | ||||||||||||||||||||||||||
Q4 2023 | $ | |||||||||||||||||||||||||
2024 | $ | |||||||||||||||||||||||||
2025 | $ | |||||||||||||||||||||||||
Natural Gas Swaps (Mcf) | ||||||||||||||||||||||||||
Q4 2023 | $ | |||||||||||||||||||||||||
2024 | $ | |||||||||||||||||||||||||
2025 | $ | |||||||||||||||||||||||||
Oil Collars (Bbl) | ||||||||||||||||||||||||||
Q4 2023 | $ | $ | ||||||||||||||||||||||||
2024 | $ | $ | ||||||||||||||||||||||||
2025 | $ | $ | ||||||||||||||||||||||||
Natural Gas Collars (Mcf) | ||||||||||||||||||||||||||
Q4 2023 | $ | $ | ||||||||||||||||||||||||
2024 | $ | $ | ||||||||||||||||||||||||
2025 | $ | $ | ||||||||||||||||||||||||
Oil Basis (Bbl) | ||||||||||||||||||||||||||
Q4 2023 | $ | |||||||||||||||||||||||||
2024 | $ |
Open Coverage Period | Notional Amount | Fixed Rate | ||||||||||||
(In thousands) | ||||||||||||||
April 2024 - April 2026 | $ | % | ||||||||||||
April 2024 - April 2026 | $ | % |
September 30, 2023 | ||||||||||||||||||||
Balance Sheet Classification | Gross Fair Value | Amounts Netted | Net Fair Value | |||||||||||||||||
(In thousands) | ||||||||||||||||||||
Current derivative assets | $ | $ | ( | $ | ||||||||||||||||
Non-current derivative assets | ( | |||||||||||||||||||
Current derivative liabilities | ( | ( | ||||||||||||||||||
Non-current derivative liabilities | ( | ( | ||||||||||||||||||
Total | $ | ( | $ | — | $ | ( | ||||||||||||||
December 31, 2022 | ||||||||||||||||||||
Balance Sheet Classification | Gross Fair Value | Amounts Netted | Net Fair Value | |||||||||||||||||
(In thousands) | ||||||||||||||||||||
Current derivative assets | $ | $ | ( | $ | ||||||||||||||||
Non-current derivative assets | ( | |||||||||||||||||||
Current derivative liabilities | ( | ( | ||||||||||||||||||
Non-current derivative liabilities | ( | ( | ||||||||||||||||||
Total | $ | ( | $ | — | $ | ( |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||
Settlements on derivative contracts | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||
Non-cash gain (loss) on derivatives | ( | ( | |||||||||||||||||||||
Gain (loss) on derivatives | $ | ( | $ | $ | ( | $ | ( |
September 30, 2023 | |||||||||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | ||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||
Financial assets: | |||||||||||||||||||||||
Commodity derivative assets | $ | $ | $ | $ | |||||||||||||||||||
Interest rate assets | $ | $ | $ | $ | |||||||||||||||||||
Financial liabilities: | |||||||||||||||||||||||
Commodity derivative liabilities | $ | $ | ( | $ | $ | ( | |||||||||||||||||
December 31, 2022 | |||||||||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | ||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||
Financial assets: | |||||||||||||||||||||||
Commodity derivative assets | $ | $ | $ | $ | |||||||||||||||||||
Financial liabilities: | |||||||||||||||||||||||
Commodity derivative liabilities | $ | $ | ( | $ | $ | ( | |||||||||||||||||
September 30, 2023 | December 31, 2022 | ||||||||||||||||||||||
Carrying Amount | Fair Value | Carrying Amount | Fair Value | ||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||
Revolving Credit Facility (Level 2) | $ | $ | $ | $ | |||||||||||||||||||
Senior Notes (Level 2) | $ | $ | $ | $ |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||
Combo | $ | $ | $ | $ | |||||||||||||||||||
REG | |||||||||||||||||||||||
Contract services - related parties | $ | $ | $ | $ | |||||||||||||||||||
Cost of contract services | $ | $ | $ | $ |
September 30, 2023 | December 31, 2022 | ||||||||||
(In thousands) | |||||||||||
Credit Facility | $ | $ | |||||||||
Senior Notes | |||||||||||
Principal | $ | $ | |||||||||
Less: Unamortized discount(1) | |||||||||||
Less: Unamortized deferred financing costs(2) | |||||||||||
Total Senior Notes | $ | $ | |||||||||
Less: Current portion of long-term debt(3) | |||||||||||
Total long-term debt | $ | $ |
September 30, 2023 | December 31, 2022 | ||||||||||
(In thousands) | |||||||||||
Outstanding borrowings | $ | $ | |||||||||
Available under the borrowing base | $ | $ |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||
Interest expense | $ | $ | $ | $ | |||||||||||||||||||
Capitalized interest | ( | ( | ( | ( | |||||||||||||||||||
Amortization of deferred financing costs | |||||||||||||||||||||||
Amortization of discount on Senior Notes | |||||||||||||||||||||||
Unused commitment fees on Credit Facility | |||||||||||||||||||||||
Total interest expense, net | $ | $ | $ | $ | |||||||||||||||||||
2021 Long-Term Incentive Plan | ||||||||||||||
Restricted Shares | Weighted Average Grant Date Fair Value | |||||||||||||
Unvested at December 31, 2022 | $ | |||||||||||||
Granted | $ | |||||||||||||
Vested | ( | $ | ||||||||||||
Forfeited | ( | $ | ||||||||||||
Unvested at September 30, 2023 | $ | |||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||
Current income tax expense: | |||||||||||||||||||||||
Federal | $ | ( | $ | $ | $ | ||||||||||||||||||
State | |||||||||||||||||||||||
Total current income tax expense | $ | $ | $ | $ | |||||||||||||||||||
Deferred income tax expense: | |||||||||||||||||||||||
Federal | $ | $ | $ | $ | |||||||||||||||||||
State | |||||||||||||||||||||||
Total deferred income tax expense | $ | $ | $ | $ | |||||||||||||||||||
Total income tax expense | $ | $ | $ | $ |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||
Tax at statutory rate | % | % | % | % | |||||||||||||||||||
Nondeductible compensation | % | % | % | % | |||||||||||||||||||
Share-based compensation | ( | % | % | ( | % | ( | % | ||||||||||||||||
State income taxes, net of federal benefit | ( | % | % | % | % | ||||||||||||||||||
Change in state rate (1) | % | % | % | % | |||||||||||||||||||
Other | % | ( | % | % | ( | % | |||||||||||||||||
Effective income tax rate | % | % | % | % |
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | |||||||||||||||||||||||
(In thousands, except per share) | ||||||||||||||||||||||||||
Net income | $ | $ | $ | $ | ||||||||||||||||||||||
Basic weighted-average common shares outstanding | ||||||||||||||||||||||||||
Restricted shares | ||||||||||||||||||||||||||
Diluted weighted average common shares outstanding | ||||||||||||||||||||||||||
Basic net income per share | $ | $ | $ | $ | ||||||||||||||||||||||
Diluted net income per share | $ | $ | $ | $ |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
Restricted shares |
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | |||||||||||||||||||||||
Revenues (in thousands): | ||||||||||||||||||||||||||
Oil sales | $ | 104,490 | $ | 80,017 | $ | 267,293 | $ | 224,895 | ||||||||||||||||||
Natural gas sales | 983 | 4,216 | 1,547 | 8,855 | ||||||||||||||||||||||
Natural gas liquids sales | 2,221 | 3,238 | 4,578 | 8,147 | ||||||||||||||||||||||
Oil and natural gas sales, net | $ | 107,694 | $ | 87,471 | $ | 273,418 | $ | 241,897 | ||||||||||||||||||
Production Data, net: | ||||||||||||||||||||||||||
Oil (MBbls) | 1,292 | 866 | 3,555 | 2,301 | ||||||||||||||||||||||
Natural gas (MMcf) | 1,616 | 985 | 4,242 | 2,239 | ||||||||||||||||||||||
Natural gas liquids (MBbls) | 274 | 140 | 691 | 303 | ||||||||||||||||||||||
Total (MBoe) | 1,835 | 1,170 | 4,953 | 2,977 | ||||||||||||||||||||||
Daily combined volumes (Boe/d) | 19,949 | 12,717 | 18,143 | 10,903 | ||||||||||||||||||||||
Daily oil volumes (Bbls/d) | 14,043 | 9,413 | 13,022 | 8,428 | ||||||||||||||||||||||
Average Realized Prices: | ||||||||||||||||||||||||||
Oil ($ per Bbl) | $ | 80.87 | $ | 92.40 | $ | 75.19 | $ | 97.74 | ||||||||||||||||||
Natural gas ($ per Mcf) | 0.61 | 4.28 | 0.36 | 3.95 | ||||||||||||||||||||||
Natural gas liquids ($ per Bbl) | 8.11 | 23.13 | 6.63 | 26.89 | ||||||||||||||||||||||
Combined ($ per Boe) | $ | 58.69 | $ | 74.76 | $ | 55.20 | $ | 81.26 | ||||||||||||||||||
Average Realized Prices, including derivative settlements:(1) | ||||||||||||||||||||||||||
Oil ($ per Bbl) | $ | 76.00 | $ | 75.80 | $ | 71.23 | $ | 73.63 | ||||||||||||||||||
Natural gas ($ per Mcf) | 0.63 | 1.57 | 0.46 | 1.40 | ||||||||||||||||||||||
Natural gas liquids ($ per Bbl) | 8.11 | 23.13 | 6.63 | 26.89 | ||||||||||||||||||||||
Combined ($ per Boe) | $ | 55.26 | $ | 60.20 | $ | 52.44 | $ | 60.69 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||
Contract services - related parties(1) | $ | 600 | $ | 600 | $ | 1,800 | $ | 1,800 | |||||||||||||||
Cost of contract services - related parties(2) | 128 | 89 | 347 | 263 | |||||||||||||||||||
Gross profit from contract services | $ | 472 | $ | 511 | $ | 1,453 | $ | 1,537 | |||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
Costs and Expenses: | (In thousands) | ||||||||||||||||||||||
Lease operating expenses | $ | 16,898 | $ | 8,813 | $ | 43,287 | $ | 23,705 | |||||||||||||||
Production and ad valorem taxes | $ | 7,242 | $ | 5,826 | $ | 18,573 | $ | 14,854 | |||||||||||||||
Exploration costs | $ | 231 | $ | 20 | $ | 643 | $ | 1,540 | |||||||||||||||
Depletion, depreciation, amortization and accretion | $ | 18,706 | $ | 8,346 | $ | 46,390 | $ | 22,167 | |||||||||||||||
Administrative costs | $ | 5,530 | $ | 5,154 | $ | 17,497 | $ | 13,567 | |||||||||||||||
Share-based compensation | 1,109 | 704 | 3,448 | 2,274 | |||||||||||||||||||
General and administrative expense | $ | 6,639 | $ | 5,858 | $ | 20,945 | $ | 15,841 | |||||||||||||||
Transaction costs | $ | 221 | $ | — | $ | 5,760 | $ | 2,638 | |||||||||||||||
Interest expense, net | $ | 10,338 | $ | 585 | $ | 21,515 | $ | 1,960 | |||||||||||||||
(Gain) loss on derivatives | $ | 35,345 | $ | (17,600) | $ | 20,925 | $ | 44,395 | |||||||||||||||
(Gain) loss from equity method investment | $ | (23) | $ | — | $ | 213 | $ | — | |||||||||||||||
Income tax expense | $ | 3,922 | $ | 16,317 | $ | 23,054 | $ | 25,130 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||
Settlements on derivative contracts | $ | (6,269) | $ | (17,040) | $ | (13,660) | $ | (61,198) | |||||||||||||||
Non-cash gain (loss) on derivatives | (29,076) | 34,640 | (7,265) | 16,803 | |||||||||||||||||||
Gain (loss) on derivatives | $ | (35,345) | $ | 17,600 | $ | (20,925) | $ | (44,395) |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||
Current income tax expense | $ | 57 | $ | 433 | $ | 5,452 | $ | 1,928 | |||||||||||||||
Deferred income tax expense | 3,865 | 15,884 | 17,602 | 23,202 | |||||||||||||||||||
Total income tax expense | $ | 3,922 | $ | 16,317 | $ | 23,054 | $ | 25,130 | |||||||||||||||
Effective income tax rate | 31.2 | % | 21.4 | % | 23.9 | % | 21.6 | % |
Nine Months Ended September 30, | ||||||||||||||
2023 | 2022 | |||||||||||||
(In thousands) | ||||||||||||||
Statement of Cash Flows Data: | ||||||||||||||
Net cash provided by operating activities | $ | 141,372 | $ | 130,352 | ||||||||||
Net cash used in investing activities | $ | (448,492) | $ | (83,182) | ||||||||||
Net cash provided by (used in) financing activities | $ | 304,185 | $ | (37,579) |
Nine Months Ended September 30, | ||||||||||||||
2023 | 2022 | |||||||||||||
(In thousands) | ||||||||||||||
Deferred financing costs | $ | (6,250) | $ | (1,722) | ||||||||||
Net proceeds (repayments) from revolving credit facility | $ | 154,000 | $ | (17,000) | ||||||||||
Proceeds from Senior Notes, net of discount and repayments | $ | 178,000 | $ | — | ||||||||||
Payment of common share dividends | $ | (20,173) | $ | (18,257) | ||||||||||
Exhibit Number | Description | ||||
Note Purchase Agreement, dates as of April 3, 2023, among Riley Exploration - Permian, LLC, as Issuer, Riley Exploration Permian, Inc., as Parent, each of the subsidiaries of the Issuer party thereto as guarantors, each of the holders from time to time party thereto, and U.S. Bank Trust Company, National Association, as agent for the holders (incorporated by reference to Exhibit 4.1 to the Registrant's Current Report on Form 8-K filed with the Securities and Exchange Commission on April 4, 2023). | |||||
Fourteenth Amendment to the Credit Agreement dated as of April 3, 2023, by and among Riley Exploration Permian, Inc., Riley Exploration - Permian, LLC, as borrower, Truist Bank, as administrative agent, and the lenders party thereto (incorporated by reference from Exhibit 10.1 to the Registrant's Current Report on Form 8-K, as filed with the Securities and Exchange Commission on April 4, 2023). | |||||
Riley Exploration Permian, Inc. 2021 Long Term Incentive Plan, as amended and restated as of April 21, 2023 (Incorporated by reference from Exhibit 10.1 to the Registrant's Current Report on Form 8-K, as filed with the Securities and Exchange Commission on April 24, 2023). | |||||
Form of Restricted Stock Agreement (Time Vesting - Named Executive Officers), as amended and restated as of April 21, 2023 (Incorporated by reference from Exhibit 10.2 to the Registrant's Current Report on Form 8-K, as filed with the Securities and Exchange Commission on April 24, 2023). | |||||
Form of Restricted Stock Agreement (Non-Employee Director), as amended and restated as of April 21, 2023 (Incorporated by reference from Exhibit 10.3 to the Registrant's Current Report on Form 8-K, as filed with the Securities and Exchange Commission on April 24, 2023). | |||||
Form of Common Stock Award Agreement, as amended and restated as of April 21, 2023 (Incorporated by reference from Exhibit 10.4 to the Registrant's Current Report on Form 8-K, as filed with the Securities and Exchange Commission on April 24, 2023). | |||||
Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | |||||
Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | |||||
Certification of Chief Executive Officer pursuant to 18 U.S.C., Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 | |||||
Certification of Chief Financial Officer pursuant to 18 U.S.C., Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 | |||||
101.INS* | XBRL Instance Document | ||||
101.SCH* | XBRL Taxonomy Extension Schema Document | ||||
101.CAL* | XBRL Taxonomy Calculation Linkbase Document | ||||
101.DEF* | XBRL Taxonomy Definition Linkbase Document | ||||
101.LAB* | XBRL Taxonomy Label Linkbase Document | ||||
101.PRE* | XBRL Taxonomy Presentation Linkbase Document |
RILEY EXPLORATION PERMIAN, INC. | ||||||||
Date: November 7, 2023 | By: | /s/ Bobby D. Riley | ||||||
Bobby D. Riley | ||||||||
Chief Executive Officer | ||||||||
By: | /s/ Philip Riley | |||||||
Philip Riley | ||||||||
Chief Financial Officer |
CERTIFICATION |
Dated: | November 7, 2023 | |||||||
By: | /s/ Bobby Riley | |||||||
Bobby D. Riley | ||||||||
Chief Executive Officer |
CERTIFICATION |
Dated: | November 7, 2023 | |||||||
By: | /s/ Philip Riley | |||||||
Philip Riley | ||||||||
Chief Financial Officer |
CERTIFICATION |
Dated: | November 7, 2023 | |||||||
By: | /s/ Bobby Riley | |||||||
Bobby D. Riley | ||||||||
Chief Executive Officer |
CERTIFICATION |
Dated: | November 7, 2023 | |||||||
By: | /s/ Philip Riley | |||||||
Philip Riley | ||||||||
Chief Financial Officer |
CONDENSED CONSOLIDATED BALANCE SHEETS (PARENTHETICAL) - $ / shares |
Sep. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Statement of Financial Position [Abstract] | ||
Preferred stock, par value (USD per Share) | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized (in Shares) | 25,000,000 | 25,000,000 |
Preferred stock, shares issued (in Shares) | 0 | 0 |
Preferred stock, shares outstanding (in Shares) | 0 | 0 |
Common stock, par value (USD per Share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized (in Shares) | 240,000,000 | 240,000,000 |
Common stock, shares issued (in Shares) | 20,146,394 | 20,160,980 |
Common stock, shares outstanding (in Shares) | 20,146,394 | 20,160,980 |
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2023 |
Sep. 30, 2022 |
Sep. 30, 2023 |
Sep. 30, 2022 |
|
Revenues: | ||||
Total Revenues | $ 108,294 | $ 88,071 | $ 275,218 | $ 243,697 |
Costs and Expenses: | ||||
Lease operating expenses | 16,898 | 8,813 | 43,287 | 23,705 |
Production and ad valorem taxes | 7,242 | 5,826 | 18,573 | 14,854 |
Exploration costs | 231 | 20 | 643 | 1,540 |
Depletion, depreciation, amortization and accretion | 18,706 | 8,346 | 46,390 | 22,167 |
General and administrative: | ||||
Administrative costs | 5,530 | 5,154 | 17,497 | 13,567 |
Share-based compensation expense | 1,109 | 704 | 3,448 | 2,274 |
Transaction costs | 221 | 0 | 5,760 | 2,638 |
Total Costs and Expenses | 50,065 | 28,952 | 135,945 | 81,008 |
Income From Operations | 58,229 | 59,119 | 139,273 | 162,689 |
Other Income (Expense): | ||||
Interest expense, net | (10,338) | (585) | (21,515) | (1,960) |
Gain (loss) on derivatives | (35,345) | 17,600 | (20,925) | (44,395) |
Gain (loss) from equity method investment | 23 | 0 | (213) | 0 |
Total Other Income (Expense) | (45,660) | 17,015 | (42,653) | (46,355) |
Net Income From Operations Before Income Taxes | 12,569 | 76,134 | 96,620 | 116,334 |
Income tax expense | (3,922) | (16,317) | (23,054) | (25,130) |
Net Income | $ 8,647 | $ 59,817 | $ 73,566 | $ 91,204 |
Net Income per Share: | ||||
Basic (USD per Share) | $ 0.44 | $ 3.06 | $ 3.74 | $ 4.67 |
Diluted (USD per Share) | $ 0.43 | $ 3.05 | $ 3.68 | $ 4.65 |
Weighted Average Common Shares Outstanding: | ||||
Basic (in Shares) | 19,680 | 19,546 | 19,667 | 19,530 |
Diluted (in Shares) | 19,989 | 19,587 | 19,964 | 19,632 |
Related Party | ||||
General and administrative: | ||||
Cost of contract services | $ 128 | $ 89 | $ 347 | $ 263 |
Oil and natural gas sales, net | ||||
Revenues: | ||||
Total Revenues | 107,694 | 87,471 | 273,418 | 241,897 |
Contract services - related parties | ||||
Revenues: | ||||
Total Revenues | $ 600 | $ 600 | $ 1,800 | $ 1,800 |
Organization and Nature of Business |
9 Months Ended |
---|---|
Sep. 30, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Nature of Business | Organization and Nature of Business Riley Permian is a growth-oriented, independent oil and natural gas company focused on the acquisition, exploration, development and production of oil, natural gas and NGL's in Texas and New Mexico. Our activities primarily include the horizontal development of conventional reservoirs on the Northwest Shelf of the Permian Basin. Our acreage is primarily located on large, contiguous blocks in Yoakum County, Texas and Eddy County, New Mexico. On April 3, 2023 (the “Closing Date”), the Company completed the acquisition of oil and natural gas assets (the “New Mexico Acquisition”) from Pecos Oil & Gas, LLC (“Pecos”), a Delaware limited liability company and an affiliate of Cibolo Energy Partners LLC. For further information regarding the New Mexico Acquisition, see Note 4 - Acquisitions of Oil and Natural Gas Properties.
|
Basis of Presentation |
9 Months Ended |
---|---|
Sep. 30, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation Effective by the Company's Board of Directors written consent on September 23, 2022, the Company's fiscal year is now the period from January 1 to December 31, beginning with the year ended December 31, 2022. These unaudited condensed consolidated financial statements as of September 30, 2023 and for the three and nine months ended September 30, 2023 and 2022 include the accounts of Riley Permian and its wholly owned subsidiaries and have been prepared in accordance with U.S. GAAP. All intercompany balances and transactions have been eliminated upon consolidation. Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to the rules and regulations of the SEC. Certain prior period amounts have been reclassified to conform to the current period financial statement presentation. These reclassifications had an immaterial effect on the previously reported total assets, total liabilities, members'/shareholders' equity, results of operations or cash flows. These condensed consolidated financial statements should be read in conjunction with the Company's Annual Report on Form 10-K for the year ended December 31, 2022. These condensed consolidated financial statements have not been audited by an independent registered public accounting firm. In the opinion of the Company’s management, the accompanying unaudited condensed consolidated financial statements contain all adjustments necessary for fair presentation of the results of operations for the periods presented, which adjustments were of a normal recurring nature, except as disclosed herein. The results of operations for the three and nine months ended September 30, 2023 are not necessarily indicative of the results to be expected for the full year ending December 31, 2023, for various reasons, including as a result of the impact of the New Mexico Acquisition, fluctuations in prices received for oil and natural gas, natural production declines, the uncertainty of exploration and development drilling results, fluctuations in the fair value of derivative instruments, the current and future impacts of the military conflicts between Russia and Ukraine and Israel and Hamas, the volatile inflationary environment in U.S. markets and other factors.
|
Summary of Significant Accounting Policies |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accounting Policies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Significant Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and accompanying notes. These estimates and assumptions may also affect disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The Company evaluates these estimates on an ongoing basis, using historical experience, consultation with experts and other methods the Company considers reasonable in the particular circumstances. Actual results may differ significantly from the Company’s estimates. Any effects on the Company’s business, financial position or results of operations resulting from revisions to these estimates are recorded in the period in which the facts that give rise to the revision become known. Significant items subject to such estimates and assumptions include, but are not limited to, estimates of proved oil and natural gas reserves and related present value estimates of future net cash flows therefrom, the carrying value of oil and natural gas properties, accounts receivable, accrued capital expenditures and operating expenses, ARO, the fair value determination of acquired assets and assumed liabilities, certain tax accruals and the fair value of derivatives. Accounts Receivable Accounts receivable is summarized below:
As of December 31, 2021, the Company has accounts receivables from oil, natural gas and NGL sales of $17.6 million. The Company had no allowance for credit losses at September 30, 2023 and December 31, 2022. Other Non-Current Assets, Net Other non-current assets consisted of the following:
(1)Deferred financing costs, net reflects costs associated with the Company's revolving credit facility which are amortized over the term of the revolving credit facility. Equity method investment. In January 2023, the Company entered into an agreement to form a joint venture created for the purpose of constructing a new power infrastructure for onsite power generation in Yoakum County, Texas using produced natural gas. RPC Power Holdco LLC, a wholly-owned subsidiary of REPX, has a 30% investment in the joint venture, RPC Power LLC ("RPC Power"). The Company contributed its portion of capital for construction of the onsite power generation. As of September 30, 2023, the Company had invested $5.8 million to date in the joint venture, comprised of $3.6 million in cash and $2.3 million of contributed assets, which was reduced by the loss during the nine months ended September 30, 2023. The onsite power generation facility is expected to be placed in service during the fourth quarter of 2023. The Company accounts for its corporate joint ventures under the equity method of accounting in accordance with FASB Accounting Standards Codification Topic 323 “Investments — Equity Method and Joint Ventures.” The Company applies the equity method of accounting to investments of less than 50% in an investee over which the Company exercises significant influence but does not have control. Under the equity method of accounting, the Company’s share of the investee’s earnings or loss is recognized in the condensed consolidated statements of operations. Judgment regarding the level of influence over each equity method investment includes considering key factors such as ownership interest, representation on the board of directors, participation in policy-making decisions, material intercompany transactions and extent of ownership by an investor in relation to the concentration of other shareholdings. Accrued Liabilities Accrued liabilities consisted of the following:
Other Current Liabilities Other current liabilities consisted of the following:
Asset Retirement Obligations Components of the changes in ARO for the nine months ended September 30, 2023 and the year ended December 31, 2022 consisted of the following and is shown below:
(1)Current ARO is included within other current liabilities on the accompanying condensed consolidated balance sheets. Revenue Recognition The following table presents oil and natural gas sales disaggregated by product:
Deferred financing costs Long-term debt includes capitalized costs related to the issuance of $200 million of 10.50% senior unsecured notes with final maturity due 2028 ("Senior Notes"), net of accumulated amortization. The costs associated with the Senior Notes are netted against the Senior Notes balance and are amortized over the term of the Senior Notes using the effective interest method. See Note 9 - Long-Term Debt for additional information. Recent Accounting Pronouncements No new accounting pronouncements have been adopted or issued that would impact the financial statements of the Company.
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Acquisitions of Oil and Natural Gas Properties |
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Business Combination and Asset Acquisition [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Acquisitions of Oil and Natural Gas Properties | Acquisitions of Oil and Natural Gas Properties New Mexico Acquisition On April 3, 2023, the Company completed the New Mexico Acquisition from Pecos for approximately $330 million, before customary purchase price adjustments. The assets acquired are located in Eddy County, New Mexico, and include approximately 10,600 total contiguous net acres of leasehold. The acquisition included 18 net horizontal wells and 250 net vertical wells. Additionally, the assets add significant drilling locations to the Company's inventory. The Company funded the New Mexico Acquisition through a combination of borrowings under the Company's revolving credit facility and proceeds from the issuance of $200 million of Senior Notes, including application of a $33 million escrow deposit paid during the three months ended March 31, 2023 with borrowings under the revolving credit facility. For further information regarding the financing for the New Mexico Acquisition, see Note 9 - Long-Term Debt. The New Mexico Acquisition qualified as a business combination using the acquisition method of accounting. The assets acquired and liabilities assumed were recognized at fair value as of the acquisition date. The preliminary purchase price allocation is subject to change for up to one year subsequent to the Closing Date due to changes in the estimated fair value of the assets acquired and liabilities assumed in the New Mexico Acquisition. The assets acquired and liabilities assumed were recognized on the condensed consolidated balance sheet at fair value as of the acquisition date. The fair value measurements of the oil and natural gas properties acquired and asset retirement obligations assumed were derived utilizing an income approach and based, in part, on significant inputs not observable in the market. These inputs represent Level 3 measurements in the fair value hierarchy and include, but are not limited to, estimates of reserves, future development, future operating costs, future cash flows and the use of weighted average cost of capital. These inputs required the use of significant judgments and estimates at the date of valuation, and use of different estimates and judgments could yield different results. The following presents the preliminary allocation of the total purchase price of the New Mexico Acquisition to the identified assets acquired and liabilities assumed based on estimated fair value as of the Closing Date:
Transaction costs associated with the New Mexico Acquisition were approximately $0.2 million and $5.8 million for the three and nine months ended September 30, 2023, respectively, and are included on the accompanying condensed consolidated statements of operations. Post-Acquisition Operating Results The results of operations attributable to the New Mexico Acquisition since the Closing Date have been included in the condensed consolidated statements of operations and include $25.1 million of total revenue, net and $15.7 million of earnings for the three months ended September 30, 2023 and $49.5 million of total revenue, net and $31.3 million of earnings for the nine months ended September 30, 2023. Pro Forma Operating Results (Unaudited) The following unaudited pro forma combined results for the three and nine months ended September 30, 2023 and 2022 reflect the consolidated results of operations of the Company as if the New Mexico Acquisition had occurred on January 1, 2022. The unaudited pro forma information includes adjustments for (i) transaction costs being reclassified to the first quarter of 2022 instead of being recorded in the three and nine months ended September 30, 2023 (ii) amortization for the discount and deferred financing costs and interest expense related to the Senior Notes, (iii) depletion, depreciation and amortization expense, and (iv) interest expense related to Pecos that would not have been recognized had the Company acquired the assets. In addition, the pro forma information has been effected for taxes with a 23% tax rate.
The unaudited pro forma combined financial information is for informational purposes only and is not intended to represent or to be indicative of the combined results of operations that the Company would have reported had the New Mexico Acquisition been completed as of January 1, 2022 and should not be taken as indicative of the Company's future combined results of operations. The actual results may differ significantly from that reflected in the unaudited pro forma combined financial information for a number of reasons, including, but not limited to, differences in assumptions used to prepare the unaudited pro forma combined financial information and actual results. Other Acquisitions On April 21, 2023, the Company completed an asset acquisition of interests in oil and natural gas leases primarily related to non-producing leasehold in Yoakum County, TX, within the San Andres formation in the Permian Basin for a purchase price of approximately $5.4 million, subject to customary post-closing adjustments. The Company accounted for this acquisition as an acquisition of assets.
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Oil and Natural Gas Properties |
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Sep. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Extractive Industries [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Oil and Natural Gas Properties | Oil and Natural Gas Properties Oil and natural gas properties are summarized below:
Depletion and amortization expense for proved oil and natural gas properties was $17.8 million and $8.2 million, respectively, for the three months ended September 30, 2023 and 2022 and $44.6 million and $21.7 million, respectively, for the nine months ended September 30, 2023 and 2022. Exploration expense was $231 thousand and $20 thousand, respectively, for the three months ended September 30, 2023 and 2022 and $0.6 million and $1.5 million, respectively, for the nine months ended September 30, 2023 and 2022. On April 3, 2023, the Company closed on the New Mexico Acquisition. For further information regarding the acquisition, see Note 4 - Acquisitions of Oil and Natural Gas Properties.
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Derivative Instruments |
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Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative Instruments | Derivative Instruments Oil and Natural Gas Contracts The Company uses commodity based derivative contracts to reduce exposure to fluctuations in oil and natural gas prices. While the use of these contracts limits the downside risk for adverse price changes, their use also limits future revenues from favorable price changes. We have not designated our derivative contracts as hedges for accounting purposes, and therefore changes in the fair value of derivatives are included and recognized in other income (expense) in the condensed consolidated statements of operations. As of September 30, 2023, the Company’s oil and natural gas derivative instruments consisted of fixed price swaps, costless collars, and basis protection swaps. The following table summarizes the open financial derivative positions as of September 30, 2023, related to oil and natural gas production:
Interest Rate Contracts The Company entered into floating-to-fixed interest rate swaps, in which it will receive a floating market rate equal to one-month CME Term SOFR Rate and will pay a fixed interest rate, to manage future interest rate exposure related to the Company’s revolving credit facility. The following table summarizes the open interest rate derivative positions as of September 30, 2023:
Balance Sheet Presentation of Derivatives The following tables present the location and fair value of the Company’s derivative contracts included in the condensed consolidated balance sheets as of September 30, 2023 and December 31, 2022:
The following table presents the components of the Company's gain (loss) on derivatives for the periods presented below:
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Fair Value Measurements |
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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 September 30, 2023 and December 31, 2022, by level within the fair value hierarchy:
The following table summarizes the fair value and carrying amount of the Company's financial instruments.
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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Transactions with Related Parties |
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Related Party Transactions [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Transactions with Related Parties | Transactions with Related Parties Contract Services Riley Permian Operating Company, LLC ("RPOC") provides certain administrative services to Combo Resources, LLC ("Combo") and is also the contract operator on behalf of Combo in exchange for a monthly fee of $100 thousand and reimbursement of all third party expenses pursuant to a contract services agreement. Additionally, RPOC provides certain administrative and operational services to Riley Exploration Group, LLC ("REG") in exchange for a monthly fee of $100 thousand pursuant to a contract services agreement. The following table presents revenues from and related cost for contract services for related parties:
The Company had amounts payable to Combo of $0.1 million and $0.4 million at September 30, 2023 and December 31, 2022, respectively, which are reflected in other current liabilities, respectively, on the accompanying condensed consolidated balance sheets. Amounts due to Combo reflect the revenue, net of any expenditures for wells and fees due under the contract services agreement, for Combo's net working interest in wells that the Company operates on Combo's behalf. Consulting and Legal Fees The Company has an engagement agreement with di Santo Law PLLC ("di Santo Law"), a law firm owned by Beth di Santo, a member of our Board of Directors, pursuant to which di Santo Law's attorneys provide legal services to the Company. The Company incurred legal fees from di Santo Law of approximately $0.3 million and $0.2 million for the three months ended September 30, 2023 and 2022, respectively, and $0.7 million and $0.5 million for the nine months ended September 30, 2023 and 2022, respectively. As of September 30, 2023 and December 31, 2022, the Company had approximately $0.2 million and zero in amounts accrued for di Santo Law, which was included in other current liabilities in the accompanying condensed consolidated balance sheets.
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Long-Term Debt |
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Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Long-Term Debt | Long-Term Debt The following table summarizes the Company's outstanding debt:
_____________________ (1)Unamortized discount on long-term debt is amortized over the life of the respective debt. (2)As of September 30, 2023, unamortized deferred financing costs are attributable to and amortized over the life of the Senior Notes. (3)As of September 30, 2023, the current portion of long-term debt reflects $20 million due on the Senior Notes over the next twelve months. Credit Facility As of September 30, 2023, Riley Exploration - Permian, LLC ("REP LLC"), as borrower, and the Company, as parent guarantor, are parties to a credit agreement with Truist Bank and certain lenders party thereto, as amended, which provides for a borrowing base of $325 million (such agreement and the borrowing facility provided thereby, the “Credit Facility”). On February 22, 2023, the Company amended its Credit Facility to, among other things, allow for the issuance of unsecured senior notes of up to $200 million. On April 3, 2023, and concurrent with the closing of the New Mexico Acquisition, the Company entered into the fourteenth amendment (the "Fourteenth Amendment") to the Credit Facility to, among other things, increase the maximum facility amount to $1.0 billion and the borrowing base from $225 million to $325 million, resulting in the addition of new lenders to the lending group. The Credit Facility is set to mature in April 2026. Substantially all of the Company’s assets are pledged to secure the Credit Facility. The following table summarizes the Credit Facility balances:
Senior Notes On April 3, 2023, and concurrent with the closing of the New Mexico Acquisition, the Company (as “Issuer”) completed its issuance of $200 million aggregate principal amount of 10.50% senior unsecured notes with final maturity April 2028 pursuant to a note purchase agreement (the “Note Purchase Agreement”), with the Senior Notes issued at a 6% discount. The net proceeds from the Senior Notes were used to fund a portion of the purchase price and related fees, costs and expenses for the New Mexico Acquisition. Interest is due and payable at the end of each quarter. In addition to interest, the Issuer will repay 2.50% of the original principal amount each quarter resulting in $5 million quarterly principal payments until the maturity of the Senior Notes. As of September 30, 2023, the Company had $20 million in current liabilities on the condensed consolidated balance sheet related to the quarterly principal payments due within the next 12 months. The Issuer may, at its option, redeem, at any time and from time to time on or prior to April 3, 2026, some or all of the Senior Notes at 100% of the principal amount thereof plus the make-whole amount plus a premium of 5.25% as set forth in the Note Purchase Agreement plus accrued and unpaid interest, if any. After April 3, 2026, but on or prior to October 3, 2026, the Issuer may, at its option, redeem, at any time and from time to time some or all of the Senior Notes at 100% of the principal amount thereof plus a premium of 5.25% as set forth in the Note Purchase Agreement plus accrued and unpaid interest, if any. After October 3, 2026, the Issuer may redeem some or all of the Senior Notes at 100% of the principal amount thereof plus accrued and unpaid interest, if any. The principal remaining outstanding at the time of maturity is required to be paid in full by the Issuer. Certain note features, including those discussed above, were evaluated and deemed to be remote. Due to the remote nature, the fair value of these features was estimated to be approximately zero. The Senior Notes contain certain covenants, which, among other things, require the maintenance of (i) a total leverage ratio of less than 3.00 to 1.00 and (ii) an asset coverage ratio greater than 1.50 to 1.00. The Senior Notes also contain a total leverage ratio and an asset coverage ratio for Restricted Payments, as defined in the Senior Notes. The leverage ratio, after giving pro forma effect to such Restricted Payments, cannot exceed 2.00 to 1.00, and the asset coverage ratio, after giving effect to such Restricted Payments, must be greater than or equal to 1.50 to 1.00. In addition to and after giving effect to such Restricted Payments, the outstanding balance on the Company's Credit Facility must be greater than or equal to 15% of the lesser of the then effective Borrowing Base and the Aggregate Elected Commitment Amount. Upon issuance of the Senior Notes, the Company must maintain a minimum hedging requirement included within the Senior Notes for oil and natural gas based on its proved developed producing projected volumes for each commodity on a rolling 18-month basis. The Senior Notes are general unsecured obligations ranking equally in right of payment with all other senior unsecured indebtedness of the Company and are senior in right of payment to all existing and future subordinated indebtedness of the Company. The Note Purchase Agreement contains customary terms and covenants, including limitations on the Company’s ability to incur additional secured and unsecured indebtedness. The following table summarizes the Company's interest expense:
As of September 30, 2023 and December 31, 2022, the weighted average interest rate on outstanding borrowings under the Credit Facility was 8.60% and 7.17%, respectively. As of September 30, 2023, the Senior Notes had $10.8 million of unamortized discount and $4.2 million of unamortized deferred financing costs, resulting in an effective interest rate of 13.38% during the nine months ended September 30, 2023. As of September 30, 2023, the Company was in compliance with the financial covenants under its debt agreements.
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Shareholders' Equity |
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Shareholders' Equity | Shareholders' Equity Dividends For the three months ended September 30, 2023 and 2022, the Company declared quarterly dividends on its common stock totaling approximately $6.7 million and $6.2 million, respectively. For the nine months ended September 30, 2023 and 2022, the Company declared quarterly dividends on its common stock totaling approximately $20.4 million and $18.5 million, respectively. Equity-Based Compensation On April 21, 2023, at the Company's annual meeting of stockholders, the Company's stockholders approved the Amended and Restated 2021 Long Term Incentive Plan (the "A&R LTIP") that increased the total number of shares of Common Stock, par value $0.001 per share, by 950,000 shares that may be utilized for awards pursuant to the Plan from 1,387,022 to 2,337,022. The A&R LTIP is included as an exhibit to the Current Report on Form 8-K filed with the Securities and Exchange Commission on April 24, 2023. The A&R LTIP had 1,366,843 shares available as of September 30, 2023. 2021 Long-Term Incentive Plan The following table presents the Company's restricted stock activity during the nine months ended September 30, 2023 under the A&R LTIP:
For the three months ended September 30, 2023 and 2022, the total equity-based compensation expense was $1.1 million and $0.8 million, respectively. For the nine months ended September 30, 2023 and 2022, the total equity-based compensation expense was $3.6 million and $2.7 million, respectively. Equity-based compensation expense is included in general and administrative costs on the Company's condensed consolidated statements of operations for the restricted share awards granted under the A&R LTIP. Approximately $5.8 million of additional equity-based compensation expense will be recognized over the weighted average life of 20 months for the unvested restricted share awards as of September 30, 2023 granted under the A&R LTIP. ATM Program On September 1, 2023, the Company entered into an Equity Distribution Agreement in connection with an at-the-market equity sales program (ATM) pursuant to which the Company may offer and sell from time to time up to an aggregate $50 million in shares of the Company's common stock through its agents. The offer and sale of the shares has been registered under the Securities Act of 1933, as amended (Securities Act), pursuant to the Company’s registration statement on Form S-3, as amended. A prospectus supplement related to the offering of the shares, as defined in Rule 415(a)(4) promulgated under the Securities Act was filed September 1, 2023. The Company intends to use the net proceeds from any offering for working capital purposes and other general corporate purposes, including, but not limited to, financing of capital expenditures, repayment or refinancing of outstanding debt, financing acquisitions or investments, financing other business opportunities, and general working capital purposes. During the period ended September 30, 2023, the Company executed sales under the ATM program of 8,939 shares which generated proceeds of approximately $0.3 million, net of approximately $9 thousand of fees. The Company incurred approximately $194 thousand of expenses associated with establishing the ATM program and filing of the related prospectus supplement. As of September 30, 2023, the Company had remaining capacity to sell up to an additional $49.7 million of common stock under the ATM program.
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Income Taxes |
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Income Tax Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income Taxes | Income Taxes The components of the Company's consolidated provision for income taxes from operations are as follows:
A reconciliation of the statutory federal income tax rate to the Company's effective income tax rate is as follows:
_____________________ (1)Reflects the impact on the Company's deferred tax balance as a result of the increased apportionment to the state of New Mexico from the New Mexico Acquisition, which is a discrete item that is not expected to notably impact the Company's effective income tax rate for the full year. The Company's federal income tax returns for the years subsequent to December 31, 2018 remain subject to examination. The Company's income tax returns in major state income tax jurisdictions remain subject to examination for various periods subsequent to December 31, 2017. The Company currently believes that all other significant filing positions are highly certain and that all of its other significant income tax positions and deductions would be sustained under audit or the final resolution would not have a material effect on the consolidated financial statements. Therefore, the Company has not established any significant reserves for uncertain tax positions.
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Net Income Per Share |
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Earnings Per Share [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net Income Per Share | Net Income Per Share The Company calculated net income per share using the treasury stock method. The table below sets forth the computation of basic and diluted net income per share for the periods presented below:
The following shares were excluded from the calculation of diluted net income per share due to their anti-dilutive effect for the periods presented:
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Commitments and Contingencies |
9 Months Ended |
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Sep. 30, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Indemnification The Company has agreed to indemnify its directors and certain of its officers, employees and agents with respect to claims and damages arising from acts or omissions taken in such capacity, as well as with respect to certain litigation. In the ordinary course of business, the Company enters into agreements that may include indemnification provisions. Pursuant to such agreements, the Company may indemnify, hold harmless and defend the indemnified parties for losses suffered or incurred by the indemnified party. Some of the provisions will limit losses to those arising from third-party actions. In some cases, the indemnification will continue after the termination of the agreement. The maximum potential amount of future payments the Company could be required to make under these provisions is not determinable. Legal Matters Due to the nature of the Company's business, the Company may at times be subject to claims and legal actions. The Company accrues liabilities when it is probable that future costs will be incurred, and such costs can be reasonably estimated. Such accruals are based on developments to date and the Company’s estimates of the outcomes of these matters. The Company did not recognize any material liability for legal matters as of September 30, 2023 and December 31, 2022. Management believes it is remote that the impact of such matters will have a materially adverse effect on the Company’s financial position, results of operations, or cash flows. Environmental Matters The Company is subject to various federal, state and local laws and regulations relating to the protection of the environment. These laws, which are often changing, regulate the discharge of materials into the environment and may require the Company to remove or mitigate the environmental effects of the disposal or release of petroleum or chemical substances at various sites. The Company had no material environmental liabilities as of September 30, 2023 or December 31, 2022. Contractual Commitments In October 2021, the Company executed an agreement related to its EOR project. This agreement is a CO2 purchase agreement that has a daily contract quantity with Kinder Morgan CO2 Company, LLC that has a primary term extending through the earlier of the total contract quantity delivered or December 31, 2025. In August 2022, the Company entered into a second amendment on its gas gathering and processing agreement with its primary midstream counterparty, Stakeholder Midstream LLC (“Stakeholder”). Stakeholder committed to expand its gathering and processing system with a commitment from the Company to deliver an annual minimum volume to Stakeholder’s gathering system for a minimum of seven years beginning on the in-service date of the expanded plant. In January 2023, the Company entered into an agreement to form a joint venture with Conduit Power LLC. The Company is committed to contributing its portion of capital expenditures into the joint venture company, RPC Power. In conjunction with the formation of the joint venture, the Company entered into additional agreements with RPC Power or one of its subsidiaries. These agreements include RPC Power providing operational expertise on the implementation and management of the power generation for a monthly fee of $20 thousand and the Company committing to provide the natural gas needed to fuel the onsite power generators through 2028. In October 2023, the Company entered into a purchase agreement for pipe related to its 2024 drilling program. Under the agreement, the Company has commitments to purchase approximately $13.1 million of pipe by December 2024.
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Subsequent Events |
9 Months Ended |
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Sep. 30, 2023 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events Dividend Declaration On October 12, 2023, the Board of Directors of the Company declared a cash dividend of $0.36 per share of common stock payable on November 9, 2023 to its shareholders of record at the close of business on October 26, 2023.
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Summary of Significant Accounting Policies (Policies) |
9 Months Ended |
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Sep. 30, 2023 | |
Accounting Policies [Abstract] | |
Consolidation | These unaudited condensed consolidated financial statements as of September 30, 2023 and for the three and nine months ended September 30, 2023 and 2022 include the accounts of Riley Permian and its wholly owned subsidiaries and have been prepared in accordance with U.S. GAAP. All intercompany balances and transactions have been eliminated upon consolidation. |
Significant Estimates | Significant Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and accompanying notes. These estimates and assumptions may also affect disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The Company evaluates these estimates on an ongoing basis, using historical experience, consultation with experts and other methods the Company considers reasonable in the particular circumstances. Actual results may differ significantly from the Company’s estimates. Any effects on the Company’s business, financial position or results of operations resulting from revisions to these estimates are recorded in the period in which the facts that give rise to the revision become known. Significant items subject to such estimates and assumptions include, but are not limited to, estimates of proved oil and natural gas reserves and related present value estimates of future net cash flows therefrom, the carrying value of oil and natural gas properties, accounts receivable, accrued capital expenditures and operating expenses, ARO, the fair value determination of acquired assets and assumed liabilities, certain tax accruals and the fair value of derivatives.
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Equity Method Investment | The Company accounts for its corporate joint ventures under the equity method of accounting in accordance with FASB Accounting Standards Codification Topic 323 “Investments — Equity Method and Joint Ventures.” The Company applies the equity method of accounting to investments of less than 50% in an investee over which the Company exercises significant influence but does not have control. Under the equity method of accounting, the Company’s share of the investee’s earnings or loss is recognized in the condensed consolidated statements of operations. Judgment regarding the level of influence over each equity method investment includes considering key factors such as ownership interest, representation on the board of directors, participation in policy-making decisions, material intercompany transactions and extent of ownership by an investor in relation to the concentration of other shareholdings. |
Deferred financing costs | Deferred financing costsLong-term debt includes capitalized costs related to the issuance of $200 million of 10.50% senior unsecured notes with final maturity due 2028 ("Senior Notes"), net of accumulated amortization. The costs associated with the Senior Notes are netted against the Senior Notes balance and are amortized over the term of the Senior Notes using the effective interest method. See Note 9 - Long-Term Debt for additional information. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements No new accounting pronouncements have been adopted or issued that would impact the financial statements of the Company.
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Summary of Significant Accounting Policies (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accounting Policies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Accounts Receivable | Accounts receivable is summarized below:
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Schedule of Other Non-Current Assets, Net | Other non-current assets consisted of the following:
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Schedule of Accrued Liabilities | Accrued liabilities consisted of the following:
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Schedule of Other Current Liabilities | Other current liabilities consisted of the following:
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Schedule of Asset Retirement Obligations | Components of the changes in ARO for the nine months ended September 30, 2023 and the year ended December 31, 2022 consisted of the following and is shown below:
(1)Current ARO is included within other current liabilities on the accompanying condensed consolidated balance sheets.
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Schedule of Disaggregation of Revenue | The following table presents oil and natural gas sales disaggregated by product:
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Acquisitions of Oil and Natural Gas Properties (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Business Combination and Asset Acquisition [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed | The following presents the preliminary allocation of the total purchase price of the New Mexico Acquisition to the identified assets acquired and liabilities assumed based on estimated fair value as of the Closing Date:
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Schedule of Business Acquisition, Pro Forma Information | The following unaudited pro forma combined results for the three and nine months ended September 30, 2023 and 2022 reflect the consolidated results of operations of the Company as if the New Mexico Acquisition had occurred on January 1, 2022. The unaudited pro forma information includes adjustments for (i) transaction costs being reclassified to the first quarter of 2022 instead of being recorded in the three and nine months ended September 30, 2023 (ii) amortization for the discount and deferred financing costs and interest expense related to the Senior Notes, (iii) depletion, depreciation and amortization expense, and (iv) interest expense related to Pecos that would not have been recognized had the Company acquired the assets. In addition, the pro forma information has been effected for taxes with a 23% tax rate.
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Oil and Natural Gas Properties (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Extractive Industries [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Oil and Gas Properties | Oil and natural gas properties are summarized below:
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Derivative Instruments (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Notional Amounts of Outstanding Derivative Positions | The following table summarizes the open financial derivative positions as of September 30, 2023, related to oil and natural gas production:
The following table summarizes the open interest rate derivative positions as of September 30, 2023:
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Schedule of Derivative Instruments Location and Fair Value | The following tables present the location and fair value of the Company’s derivative contracts included in the condensed consolidated balance sheets as of September 30, 2023 and December 31, 2022:
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Schedule of Derivative Instruments, Gain (Loss) | The following table presents the components of the Company's gain (loss) on derivatives for the periods presented below:
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Fair Value Measurements (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis | The following table presents the Company’s financial assets and liabilities that were accounted for at fair value on a recurring basis as of September 30, 2023 and December 31, 2022, by level within the fair value hierarchy:
The following table summarizes the fair value and carrying amount of the Company's financial instruments.
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Transactions with Related Parties (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Related Party Transactions [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Related Party Transactions | The following table presents revenues from and related cost for contract services for related parties:
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Long-Term Debt (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Debt | The following table summarizes the Company's outstanding debt:
_____________________ (1)Unamortized discount on long-term debt is amortized over the life of the respective debt. (2)As of September 30, 2023, unamortized deferred financing costs are attributable to and amortized over the life of the Senior Notes. (3)As of September 30, 2023, the current portion of long-term debt reflects $20 million due on the Senior Notes over the next twelve months.
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Schedule of Credit Facility | The following table summarizes the Credit Facility balances:
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Schedule of Components of Interest Expense | The following table summarizes the Company's interest expense:
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Shareholders' Equity (Tables) |
9 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Restricted Stock, Activity | The following table presents the Company's restricted stock activity during the nine months ended September 30, 2023 under the A&R LTIP:
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Income Taxes (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income Tax Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Components of Income Tax Expense | The components of the Company's consolidated provision for income taxes from operations are as follows:
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Schedule of Effective Income Tax Rate Reconciliation | A reconciliation of the statutory federal income tax rate to the Company's effective income tax rate is as follows:
_____________________ (1)Reflects the impact on the Company's deferred tax balance as a result of the increased apportionment to the state of New Mexico from the New Mexico Acquisition, which is a discrete item that is not expected to notably impact the Company's effective income tax rate for the full year.
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Net Income Per Share (Tables) |
9 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Computation of Basic and Diluted Net income Per Shares | The table below sets forth the computation of basic and diluted net income per share for the periods presented below:
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Schedule of Anti-Dilutive Shares | The following shares were excluded from the calculation of diluted net income per share due to their anti-dilutive effect for the periods presented:
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Summary of Significant Accounting Policies - Schedule of Accounts Receivable (Details) - USD ($) $ in Thousands |
Sep. 30, 2023 |
Dec. 31, 2022 |
Dec. 31, 2021 |
---|---|---|---|
Accounting Policies [Abstract] | |||
Oil, natural gas and NGL sales | $ 41,368 | $ 24,136 | $ 17,600 |
Joint interest accounts receivable | 3,581 | 793 | |
Other accounts receivable | 373 | 622 | |
Total accounts receivable | $ 45,322 | $ 25,551 |
Summary of Significant Accounting Policies - Schedule of Other Non-Current Assets, Net (Details) - USD ($) $ in Thousands |
Sep. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Accounting Policies [Abstract] | ||
Deferred financing costs, net | $ 3,468 | $ 2,556 |
Right of use assets | 1,379 | 1,370 |
Equity method investment | 5,625 | 0 |
Other | 1,015 | 249 |
Total other non-current assets, net | $ 11,487 | $ 4,175 |
Summary of Significant Accounting Policies - Schedule of Accrued Liabilities (Details) - USD ($) $ in Thousands |
Sep. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Accounting Policies [Abstract] | ||
Accrued capital expenditures | $ 7,295 | $ 16,744 |
Accrued lease operating expenses | 4,508 | 4,607 |
Accrued general and administrative costs | 5,826 | 2,286 |
Accrued inventory | 884 | 6,235 |
Accrued ad valorem tax | 3,952 | 3,789 |
Other accrued expenditures | 1,523 | 1,921 |
Total accrued liabilities | $ 23,988 | $ 35,582 |
Summary of Significant Accounting Policies - Schedule of Other Current Liabilities (Details) - USD ($) $ in Thousands |
Sep. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Related Party Transaction [Line Items] | ||
Advances from joint interest owners | $ 312 | $ 192 |
Income taxes payable | 0 | 1,194 |
Current ARO liabilities | 1,430 | 314 |
Lease liabilities | 796 | 538 |
Total other current liabilities | 2,798 | 2,562 |
Related Party | ||
Related Party Transaction [Line Items] | ||
Accounts payable | $ 260 | $ 324 |
Summary of Significant Accounting Policies - Schedule of Asset Retirement Obligations (Details) - USD ($) $ in Thousands |
9 Months Ended | 12 Months Ended |
---|---|---|
Sep. 30, 2023 |
Dec. 31, 2022 |
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Asset Retirement Obligation, Roll Forward Analysis [Roll Forward] | ||
ARO, beginning balance | $ 3,038 | $ 2,453 |
Liabilities incurred | 37 | 358 |
Liabilities assumed in acquisitions | 19,359 | 0 |
Revision of estimated obligations | 0 | 326 |
Liability settlements and disposals | (1,020) | (178) |
Accretion | 1,105 | 79 |
ARO, ending balance | 22,519 | 3,038 |
Less: current ARO | (1,430) | (314) |
ARO, long-term | $ 21,089 | $ 2,724 |
Summary of Significant Accounting Policies - Schedule of Revenue (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2023 |
Sep. 30, 2022 |
Sep. 30, 2023 |
Sep. 30, 2022 |
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Disaggregation of Revenue [Line Items] | ||||
Total Revenues | $ 108,294 | $ 88,071 | $ 275,218 | $ 243,697 |
Oil and natural gas sales, net | ||||
Disaggregation of Revenue [Line Items] | ||||
Total Revenues | 107,694 | 87,471 | 273,418 | 241,897 |
Oil | ||||
Disaggregation of Revenue [Line Items] | ||||
Total Revenues | 104,490 | 80,017 | 267,293 | 224,895 |
Natural gas | ||||
Disaggregation of Revenue [Line Items] | ||||
Total Revenues | 983 | 4,216 | 1,547 | 8,855 |
Natural gas liquids | ||||
Disaggregation of Revenue [Line Items] | ||||
Total Revenues | $ 2,221 | $ 3,238 | $ 4,578 | $ 8,147 |
Acquisitions of Oil and Natural Gas Properties - Schedule of Recognized Identified Assets Acquired and Liabilities Assumed (Details) - New Mexico Acquisition $ in Thousands |
Sep. 30, 2023
USD ($)
|
---|---|
Business Acquisition [Line Items] | |
Total cash consideration | $ 324,686 |
Assets acquired: | |
Inventory | 2,980 |
Oil and natural gas properties | 342,457 |
Amount attributable to assets acquired | 345,437 |
Fair value of liabilities assumed: | |
Revenue payable | 1,475 |
Asset retirement obligations | 19,276 |
Amount attributable to liabilities assumed | 20,751 |
Net identifiable assets acquired | $ 324,686 |
Acquisitions of Oil and Natural Gas Properties - Schedule of Business Acquisition, Pro Forma Information (Details) - New Mexico Acquisition - USD ($) $ / shares in Units, $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2023 |
Sep. 30, 2022 |
Sep. 30, 2023 |
Sep. 30, 2022 |
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Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items] | ||||
Total revenues | $ 108,294 | $ 117,256 | $ 305,813 | $ 331,910 |
Net income | $ 10,745 | $ 66,421 | $ 87,545 | $ 108,845 |
Basic net income per common share (USD per share) | $ 0.55 | $ 3.40 | $ 4.45 | $ 5.57 |
Diluted net income per common share (USD per share) | $ 0.54 | $ 3.39 | $ 4.39 | $ 5.54 |
Oil and Natural Gas Properties - Schedule of Oil and Gas Properties (Details) - USD ($) $ in Thousands |
Sep. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Extractive Industries [Abstract] | ||
Proved | $ 872,204 | $ 516,011 |
Unproved | 110,234 | 12,770 |
Work-in-progress | 49,026 | 45,169 |
Total oil and natural gas properties, gross | 1,031,464 | 573,950 |
Accumulated depletion, amortization and impairment | (178,432) | (133,848) |
Total oil and natural gas properties, net | $ 853,032 | $ 440,102 |
Oil and Natural Gas Properties - Narrative (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2023 |
Sep. 30, 2022 |
Sep. 30, 2023 |
Sep. 30, 2022 |
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Extractive Industries [Abstract] | ||||
Depletion and amortization | $ 17,800 | $ 8,200 | $ 44,600 | $ 21,700 |
Exploration costs | $ 231 | $ 20 | $ 643 | $ 1,540 |
Derivative Instruments - Summary of Open Interest Rate Derivative Positions (Details) $ in Thousands |
Sep. 30, 2023
USD ($)
|
---|---|
Floating To Fixed Interest Rate Swaps April 2024 To April 2026, 3.18% | |
Derivative [Line Items] | |
Notional Amount | $ 30,000 |
Fixed rate (as a percent) | 3.18% |
Floating To Fixed Interest Rate Swaps April 2024 To April 2026, 3.039% | |
Derivative [Line Items] | |
Notional Amount | $ 50,000 |
Fixed rate (as a percent) | 3.039% |
Derivative Instruments - Schedule of Derivative Instruments, Gain (Loss) (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2023 |
Sep. 30, 2022 |
Sep. 30, 2023 |
Sep. 30, 2022 |
|
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||||
Settlements on derivative contracts | $ (6,269) | $ (17,040) | $ (13,660) | $ (61,198) |
Non-cash gain (loss) on derivatives | (29,076) | 34,640 | (7,265) | 16,803 |
Gain (loss) on derivatives | $ (35,345) | $ 17,600 | $ (20,925) | $ (44,395) |
Transactions with Related Parties - Narrative (Details) - USD ($) |
3 Months Ended | 9 Months Ended | |||
---|---|---|---|---|---|
Sep. 30, 2023 |
Sep. 30, 2022 |
Sep. 30, 2023 |
Sep. 30, 2022 |
Dec. 31, 2022 |
|
Related Party Transaction [Line Items] | |||||
Other current liabilities | $ 2,798,000 | $ 2,798,000 | $ 2,562,000 | ||
Related Party | Contract Services Agreement | Combo Resources, LLC | |||||
Related Party Transaction [Line Items] | |||||
Monthly servicing fee | 100,000 | ||||
Other current liabilities | 100,000 | 100,000 | 400,000 | ||
Related Party | Contract Services Agreement | Riley Exploration Group, Inc | |||||
Related Party Transaction [Line Items] | |||||
Monthly servicing fee | 100,000 | ||||
Related Party | Legal Services | di Santo Law PLLC | Director | |||||
Related Party Transaction [Line Items] | |||||
Other current liabilities | 200,000 | 200,000 | $ 0 | ||
Amounts of transaction | $ 300,000 | $ 200,000 | $ 700,000 | $ 500,000 |
Transactions with Related Parties - Schedule of Related Party Transactions (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2023 |
Sep. 30, 2022 |
Sep. 30, 2023 |
Sep. 30, 2022 |
|
Related Party Transaction [Line Items] | ||||
Contract services | $ 108,294 | $ 88,071 | $ 275,218 | $ 243,697 |
Related Party | ||||
Related Party Transaction [Line Items] | ||||
Cost of contract services | 128 | 89 | 347 | 263 |
Related Party | Contract Services Agreement | ||||
Related Party Transaction [Line Items] | ||||
Contract services | 600 | 600 | 1,800 | 1,800 |
Related Party | Contract Services Agreement | Combo Resources, LLC | ||||
Related Party Transaction [Line Items] | ||||
Contract services | 300 | 300 | 900 | 900 |
Related Party | Contract Services Agreement | Riley Exploration Group, Inc | ||||
Related Party Transaction [Line Items] | ||||
Contract services | $ 300 | $ 300 | $ 900 | $ 900 |
Long-Term Debt - Schedule of Outstanding Debt (Details) - USD ($) $ in Thousands |
Sep. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Line of Credit Facility [Line Items] | ||
Less: Current portion of long-term debt | $ 20,000 | $ 0 |
Total long-term debt | 365,069 | 56,000 |
Credit Facility | Revolving Credit Facility | ||
Line of Credit Facility [Line Items] | ||
Long-term debt | 210,000 | 56,000 |
Senior Notes | ||
Line of Credit Facility [Line Items] | ||
Long-term debt | 175,069 | 0 |
Principal | 190,000 | 0 |
Less: Unamortized discount | 10,765 | 0 |
Less: Unamortized deferred financing costs | 4,166 | $ 0 |
Less: Current portion of long-term debt | $ 20,000 |
Long-Term Debt - Summary of Credit Facility Balances (Details) - Revolving Credit Facility - Credit Facility - USD ($) $ in Thousands |
Sep. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Line of Credit Facility [Line Items] | ||
Outstanding borrowings | $ 210,000 | $ 56,000 |
Available under the borrowing base | $ 115,000 | $ 169,000 |
Long-Term Debt - Components of Interest Expense (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2023 |
Sep. 30, 2022 |
Sep. 30, 2023 |
Sep. 30, 2022 |
|
Line of Credit Facility [Line Items] | ||||
Interest expense | $ 9,848 | $ 519 | $ 20,913 | $ 1,626 |
Capitalized interest | (839) | (246) | (2,289) | (576) |
Amortization of deferred financing costs | 593 | 175 | 1,236 | 548 |
Total interest expense, net | 10,338 | 585 | 21,515 | 1,960 |
Senior Notes | 10.50% Senior Unsecured Notes due 2028 | ||||
Line of Credit Facility [Line Items] | ||||
Amortization of discount on Senior Notes | 596 | 0 | 1,234 | 0 |
Credit Facility | Revolving Credit Facility | ||||
Line of Credit Facility [Line Items] | ||||
Unused commitment fees on Credit Facility | $ 140 | $ 137 | $ 421 | $ 362 |
Shareholders' Equity - Schedule of Restricted Stock Units Activity (Details) - Restricted Stock - A&R Long-Term Investment Plan |
9 Months Ended |
---|---|
Sep. 30, 2023
$ / shares
shares
| |
Restricted Shares | |
Unvested, beginning balance (in Shares) | shares | 536,209 |
Granted (in Shares) | shares | 32,736 |
Vested (in Shares) | shares | (169,149) |
Forfeited (in Shares) | shares | (9,160) |
Unvested, ending balance (in Shares) | shares | 390,636 |
Weighted Average Grant Date Fair Value | |
Unvested, beginning balance (USD per Share) | $ / shares | $ 18.39 |
Granted (USD per Share) | $ / shares | 37.32 |
Vested (USD per Share) | $ / shares | 18.15 |
Forfeited (USD per Share) | $ / shares | 19.81 |
Unvested, ending balance (USD per Share) | $ / shares | $ 19.71 |
Income Taxes - Schedule of Components of Income Tax Expense (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2023 |
Sep. 30, 2022 |
Sep. 30, 2023 |
Sep. 30, 2022 |
|
Current income tax expense: | ||||
Federal | $ (76) | $ 142 | $ 4,705 | $ 1,442 |
State | 133 | 291 | 747 | 486 |
Total current income tax expense | 57 | 433 | 5,452 | 1,928 |
Deferred income tax expense: | ||||
Federal | 2,744 | 15,460 | 15,039 | 22,439 |
State | 1,121 | 424 | 2,563 | 763 |
Total deferred income tax expense | 3,865 | 15,884 | 17,602 | 23,202 |
Total income tax expense | $ 3,922 | $ 16,317 | $ 23,054 | $ 25,130 |
Income Taxes - Schedule of Effective Income Tax Rate Reconciliation (Details) |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2023 |
Sep. 30, 2022 |
Sep. 30, 2023 |
Sep. 30, 2022 |
|
Effective Income Tax Rate Reconciliation, Percent [Abstract] | ||||
Tax at statutory rate | 21.00% | 21.00% | 21.00% | 21.00% |
Nondeductible compensation | 4.80% | 0.10% | 0.70% | 0.20% |
Share-based compensation | (2.40%) | 0.00% | (0.50%) | (0.10%) |
State income taxes, net of federal benefit | (2.00%) | 0.80% | 1.40% | 0.80% |
Change in state rate | 9.80% | 0.00% | 1.30% | 0.00% |
Other | 0.00% | (0.50%) | 0.00% | (0.30%) |
Effective income tax rate | 31.20% | 21.40% | 23.90% | 21.60% |
Net Income Per Share - Schedule of Computation of Basic and Diluted Net Loss Per Shares (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands |
3 Months Ended | 9 Months Ended | ||||||
---|---|---|---|---|---|---|---|---|
Sep. 30, 2023 |
Jun. 30, 2023 |
Mar. 31, 2023 |
Sep. 30, 2022 |
Jun. 30, 2022 |
Mar. 31, 2022 |
Sep. 30, 2023 |
Sep. 30, 2022 |
|
Earnings Per Share [Abstract] | ||||||||
Net income | $ 8,647 | $ 33,068 | $ 31,851 | $ 59,817 | $ 38,555 | $ (7,168) | $ 73,566 | $ 91,204 |
Basic weighted-average common shares outstanding (in Shares) | 19,680 | 19,546 | 19,667 | 19,530 | ||||
Restricted shares (in Shares) | 309 | 41 | 297 | 102 | ||||
Diluted weighted-average common shares outstanding (in Shares) | 19,989 | 19,587 | 19,964 | 19,632 | ||||
Basic net income per share (USD per Share) | $ 0.44 | $ 3.06 | $ 3.74 | $ 4.67 | ||||
Diluted net income per share (USD per Share) | $ 0.43 | $ 3.05 | $ 3.68 | $ 4.65 |
Net Income Per Share - Schedule of Anti-Dilutive Shares (Details) - shares |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2023 |
Sep. 30, 2022 |
Sep. 30, 2023 |
Sep. 30, 2022 |
|
Restricted shares | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Anti-dilutive securities (in Shares) | 186,701 | 293,473 | 199,051 | 232,246 |
Commitments and Contingencies (Details) - USD ($) |
1 Months Ended | ||||
---|---|---|---|---|---|
Aug. 31, 2022 |
Oct. 31, 2023 |
Sep. 30, 2023 |
Jan. 31, 2023 |
Dec. 31, 2022 |
|
Loss Contingencies [Line Items] | |||||
Environmental liabilities | $ 0 | $ 0 | |||
RPC Power, LLC | |||||
Loss Contingencies [Line Items] | |||||
Contractual obligation, monthly fee | $ 20,000 | ||||
Stakeholder | |||||
Loss Contingencies [Line Items] | |||||
Purchase obligation, delivery period | 7 years | ||||
2024 Drilling Program | Subsequent Event | |||||
Loss Contingencies [Line Items] | |||||
Purchase obligation | $ 13,100,000 |
Subsequent Events (Details) |
Oct. 12, 2023
$ / shares
|
---|---|
Subsequent Event | |
Subsequent Event [Line Items] | |
Cash dividend declared (USD per Share) | $ 0.36 |
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