Discontinued Operations

3 Months Ended

Mar. 31, 2014

Discontinued Operations and Disposal Groups [Abstract]

Discontinued Operations

3. Discontinued Operations

On February 22, 2013, the Company closed on the sale of Carrizo UK, and all of its interest in the Huntington Field discovery, including a 15% non-operated working interest and certain overriding royalty interests, to a subsidiary of Iona Energy Inc. (“Iona Energy”) for an agreed-upon price of $184.0 million, including the assumption and repayment by Iona Energy of the $55.0 million of borrowings outstanding under Carrizo UK’s senior secured multicurrency credit facility as of the closing date. The liabilities of discontinued operations of $26.6 million as of March 31, 2014 relate to an accrual for estimated future obligations related to the sale. See “Note 2. Summary of Significant Accounting Policies—Use of Estimates” for further discussion of estimates and assumptions that may affect the reported amounts of liabilities related to the sale of Carrizo UK.

The following table summarizes the amounts included in income (loss) from discontinued operations, net of income taxes presented in the consolidated statements of income for the three months ended March 31,2014 and 2013:

	Three Months Ended March 31,
	2014		2013
	(In thousands)
Revenues	—		—
Costs and Expenses
General and administrative	437		5
Accretion related to asset retirement obligations	—		36
Gain on sale of discontinued operations	—		(37,294	)
Increase in estimated future obligations	535		—
Loss on derivatives, net	20		44
Other income, net	—		(24	)
Income (Loss) From Discontinued Operations Before Income Taxes	(992	)	37,233
Income tax (expense) benefit	347		(13,575	)
Income (Loss) From Discontinued Operations, Net of Income Taxes	($645)		$23,658

Income Taxes

Carrizo UK is a disregarded entity for U.S. federal income tax purposes. Accordingly, the income tax (expense) benefit reflected above includes the Company’s U.S. deferred income tax (expense) benefit associated with the income (loss) from discontinued operations before income taxes. The related U.S. deferred tax assets and liabilities have been classified as deferred income taxes of continuing operations in the consolidated balance sheets.