ADDITIONAL FINANCIAL STATEMENT INFORMATION

12 Months Ended

Dec. 31, 2023

ADDITIONAL FINANCIAL STATEMENT INFORMATION

ADDITIONAL FINANCIAL STATEMENT INFORMATION

15. ADDITIONAL FINANCIAL STATEMENT INFORMATION

Certain balance sheet amounts are comprised of the following (in thousands) for the periods presents:

	December 31, 2023		December 31, 2022
Accounts receivable, net:
Oil, natural gas and natural gas liquids revenues	$	19,802	$	33,980
Joint interest accounts		2,138		3,201
Other		1,081		793
	$	23,021	$	37,974
Prepaids and other:
Prepaids	$	490	$	715
Funds in escrow		345		341
Other		72		75
	$	907	$	1,131
Other assets (Non-current):
Investment in unconsolidated affiliate	$	1,283	$	1,561
Contract asset		15,062		—
Funds in escrow		552		527
Other		759		739
	$	17,656	$	2,827
Accounts payable and accrued liabilities:
Trade payables	$	24,915	$	42,919
Accrued oil and natural gas capital costs		15,337		19,911
Revenues and royalties payable		18,986		26,759
Accrued interest expense		347		160
Accrued employee compensation		520		2,300
Accrued lease operating expenses		6,418		8,005
Other		2		41
	$	66,525	$	100,095

Investment in Unconsolidated Affiliate. In May 2022, the Company entered into a joint venture with Caracara Services, LLC (“Caracara”) to develop an acid gas treatment facility to remove hydrogen sulfide and carbon dioxide from its produced natural gas. Caracara provided the initial capital for the construction of the treatment facility. The Company contributed certain full cost pool assets to the related party joint venture in a non-cash exchange for a retained 5% equity interest in Wink Amine Treater, LLC (“WAT”) (previously Brazos Amine Treater, LLC (“BAT”)), an unconsolidated subsidiary. For accounting purposes, since the Company does not control the key activities (e.g. operating and maintaining the facility) which most significantly impact economic performance nor does the Company have the obligation to absorb losses or the right to receive benefits that could potentially be significant, the Company is not the primary beneficiary of WAT. Accordingly, the Company accounts for its investment in WAT (a related party) using the equity method of accounting based on its ability to exercise significant influence, but not control, over the key activities of the joint venture. For more information related to this joint venture, see Note 10, “Commitments and Contingencies”.

Contract Asset. During 2023, the Company advanced a capital contribution of approximately $15.1 million on behalf of its joint venture partner in WAT to fund a workover operation on the AGI well. Pursuant to the terms of the agreement governing the joint venture, the Company has multiple remedies to recover such advance, including (1) declaring such payment a loan, which pursuant to the agreement would have an interest rate of the lessor of 15% or the maximum rate permitted by law, (2) recoupment from distributions from the joint venture and (3) reallocation of equity of the joint venture based on the relative level of total capital contributions by the parties after taking into account the advance. The Company advanced additional capital contributions on behalf of its joint venture partner during the first quarter of 2024 of approximately $3.0 million to fund WAT with the necessary capital required to complete the sidetrack of the AGI well.