Acquisitions and Divestitures

9 Months Ended

Sep. 30, 2021

Discontinued Operations and Disposal Groups [Abstract]

Acquisitions and Divestitures

Acquisitions and Divestitures

Overriding Royalty Interest Assets

On April 22, 2021, the Company acquired all of the overriding royalty interest assets of SandRidge Mississippian Trust I (the “Trust”). The gross purchase price was $4.9 million (net $3.6 million, given our 26.9% ownership of the Trust).

On September 10, 2020, the Company acquired all of the overriding royalty interest assets of SandRidge Mississippian Trust II. The gross purchase price was $5.3 million (net $3.3 million, given our 37.6% ownership of the Trust).

North Park Basin Sale

On February 5, 2021, the Company sold all of its oil and natural gas properties and related assets of the North Park Basin (“NPB” or “North Park”), in Colorado, for a purchase price of $47 million. The sale closed for net proceeds of $39.7 million in cash, which amounts to the purchase price of $47 million net of effective date to close date adjustments. Consequently, the Company allocated a portion of the full cost pool net book value, using the income approach, to the divested oil and gas properties and recognized a reduction of full cost pool assets of $22.0 million and a reduction of $4.6 million to its non-full cost pool assets. As the sale significantly altered the relationship between capitalized costs and proved reserves, the Company recognized a $19.7 million gain related to the assets sold. The gain represents net proceeds of $39.7 million coupled with the release of revenues in suspense of $0.5 million and the relief of asset retirement obligations of $6.1 million offset by the reduction of $26.6 million in oil and gas properties related to NPB. The Company recorded a decrease to the sales price of $0.8 million as a result of post-closing adjustments made during the three months ended September 30, 2021. As a result, (Gain) loss on sale of assets decreased to $18.9 million for the nine months ended September 30, 2021.

For the nine-months ended September 30, 2021, NPB represented $3.2 million, or 2.8% of the Company's $114.4 million total consolidated Revenues, NPB represented $0.9 million, or 3.5% of the Company's $26.3 million consolidated Lease

operating expense and NPB represented 0.1 MMBoe, or 1.3% of the Company's consolidated total production volumes of 5.1 MMBoe.

For the three-months ended September 30, 2020, NPB represented $7.1 million, or 25.6% of the Company's $27.7 million total consolidated Revenues, NPB represented $1.3 million or 16.4% of the Company's $8.1 million consolidated Lease operating expense, it represented $0.5 million, or 19.9% of the Company's $2.3 million consolidated Production, ad valorem and other taxes and NPB represented 0.2 MMBoe, or 9.9% of the Company's consolidated total production volumes of 2.0 MMBoe.

For the nine-months ended September 30, 2020, NPB represented $24.5 million, or 28.9% of the Company's $84.7 million total consolidated Revenues, NPB represented $7.1 million or 21.9% of the Company's $32.4 million consolidated Lease operating expense, it represented $1.5 million, or 20.9% of the Company's $7.4 million consolidated Production, ad valorem and other taxes and NPB represented 0.8 MMBoe, or 11.1% of the Company's consolidated total production volumes of 6.8 MMBoe.