Subsidiary Guarantors (Tables)

9 Months Ended

Sep. 30, 2016

Subsidiary Guarantors

Schedule of condensed consolidated balance sheets

Condensed Consolidating Balance Sheets

December 31, 2015

(In thousands)

	Parent		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminations		Consolidated
Assets
Current assets:
Cash and cash equivalents	$	16,590		—		6,883		—		23,473
Accounts receivable, net		76,697		—		2,707		—		79,404
Intercompany receivables		2,138		—		65,712		(67,850)		—
Accrued revenue		128,242		—		—		—		128,242
Derivative instruments		1,009,030		—		—		—		1,009,030
Other current assets		8,087		—		—		—		8,087
Total current assets		1,240,784		—		75,302		(67,850)		1,248,236
Property and equipment:
Natural gas properties, at cost (successful efforts method):
Unproved properties		1,996,081		—		—		—		1,996,081
Proved properties		8,243,901		—		—		(32,795)		8,211,106
Water handling and treatment systems		—		—		565,616		—		565,616
Gathering systems and facilities		16,561		—		1,485,835		—		1,502,396
Other property and equipment		46,415		—		—		—		46,415
		10,302,958		—		2,051,451		(32,795)		12,321,614
Less accumulated depletion, depreciation, and amortization		(1,431,747)		—		(157,625)		—		(1,589,372)
Property and equipment, net		8,871,211		—		1,893,826		(32,795)		10,732,242
Derivative instruments		2,108,450		—		—		—		2,108,450
Investments in subsidiaries		(302,336)		—		—		302,336		—
Contingent acquisition consideration		178,049		—		—		(178,049)		—
Other assets, net		15,661		—		10,904		—		26,565
Total assets	$	12,111,819		—		1,980,032		23,642		14,115,493
Liabilities and Equity
Current liabilities:
Accounts payable	$	303,197		—		60,963		—		364,160
Intercompany payable		65,712		—		2,138		(67,850)		—
Accrued liabilities		158,713		—		35,363		—		194,076
Revenue distributions payable		129,949		—		—		—		129,949
Other current liabilities		18,935		—		150		—		19,085
Total current liabilities		676,506		—		98,614		(67,850)		707,270
Long-term liabilities:
Long-term debt		4,048,782		—		620,000		—		4,668,782
Deferred income tax liability		1,370,686		—		—		—		1,370,686
Contingent acquisition consideration		—		—		178,049		(178,049)		—
Other liabilities		81,453		—		624		—		82,077
Total liabilities		6,177,427		—		897,287		(245,899)		6,828,815
Equity:
Stockholders' equity:
Partners' capital		—		—		1,082,745		(1,082,745)		—
Common stock		2,770		—		—		—		2,770
Additional paid-in capital		4,122,811		—		—		—		4,122,811
Accumulated earnings		1,808,811		—		—		—		1,808,811
Total stockholders' equity		5,934,392		—		1,082,745		(1,082,745)		5,934,392
Noncontrolling interest in consolidated subsidiary		—		—		—		1,352,286		1,352,286
Total equity		5,934,392		—		1,082,745		269,541		7,286,678
Total liabilities and equity	$	12,111,819		—		1,980,032		23,642		14,115,493

Condensed Consolidating Balance Sheet

September 30, 2016

(In thousands)

	Parent		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminations		Consolidated
Assets
Current assets:
Cash and cash equivalents	$	9,291		—		9,221		—		18,512
Accounts receivable, net		58,219		—		1,243		—		59,462
Intercompany receivables		2,237		—		58,398		(60,635)		—
Accrued revenue		196,490		—		—		—		196,490
Derivative instruments		417,605		—		—		—		417,605
Other current assets		3,349		—		53		—		3,402
Total current assets		687,191		—		68,915		(60,635)		695,471
Property and equipment:
Natural gas properties, at cost (successful efforts method):
Unproved properties		2,449,995		—		—		—		2,449,995
Proved properties		9,312,455		—		—		(131,750)		9,180,705
Water handling and treatment systems		—		—		681,062		—		681,062
Gathering systems and facilities		17,928		—		1,638,748		—		1,656,676
Other property and equipment		45,571		—		—		—		45,571
		11,825,949		—		2,319,810		(131,750)		14,014,009
Less accumulated depletion, depreciation, and amortization		(1,945,069)		—		(231,724)		—		(2,176,793)
Property and equipment, net		9,880,880		—		2,088,086		(131,750)		11,837,216
Derivative instruments		2,015,090		—		—		—		2,015,090
Investments in subsidiaries		(375,986)		—		—		375,986		—
Contingent acquisition consideration		188,433		—		—		(188,433)		—
Other assets, net		22,190		—		59,286		—		81,476
Total assets	$	12,417,798		—		2,216,287		(4,832)		14,629,253
Liabilities and Equity
Current liabilities:
Accounts payable	$	122,220		—		50,073		—		172,293
Intercompany payable		58,398		—		2,237		(60,635)		—
Accrued liabilities		235,560		—		9,614		—		245,174
Revenue distributions payable		172,202		—		—		—		172,202
Derivative instruments		3,110		—		—		—		3,110
Other current liabilities		18,928		—		197		—		19,125
Total current liabilities		610,418		—		62,121		(60,635)		611,904
Long-term liabilities:
Long-term debt		3,950,138		—		809,766		—		4,759,904
Deferred income tax liability		1,215,240		—		—		—		1,215,240
Contingent acquisition consideration		—		—		188,433		(188,433)		—
Derivative instruments		40		—		—		—		40
Other liabilities		61,214		—		669		—		61,883
Total liabilities		5,837,050		—		1,060,989		(249,068)		6,648,971
Equity:
Stockholders' equity:
Partners' capital		—		—		1,155,298		(1,155,298)		—
Common stock		3,072		—		—		—		3,072
Additional paid-in capital		5,131,909		—		—		—		5,131,909
Accumulated earnings		1,445,767		—		—		—		1,445,767
Total stockholders' equity		6,580,748		—		1,155,298		(1,155,298)		6,580,748
Noncontrolling interest in consolidated subsidiary		—		—		—		1,399,534		1,399,534
Total equity		6,580,748		—		1,155,298		244,236		7,980,282
Total liabilities and equity	$	12,417,798		—		2,216,287		(4,832)		14,629,253

Schedule of condensed consolidated statement of operations and comprehensive income (loss)

Condensed Consolidating Statement of Operations and Comprehensive Income

Three Months Ended September 30, 2015

(In thousands)

	Parent		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminations		Consolidated
Revenue:
Natural gas sales	$	253,975		—		—		—		253,975
Natural gas liquids sales		50,092		—		—		—		50,092
Oil sales		20,138		—		—		—		20,138
Gathering, compression, and water handling and treatment		958		—		59,258		(55,790)		4,426
Marketing		35,633		—		—		—		35,633
Commodity derivative fair value losses		1,079,071		—		—		—		1,079,071
Other income		324		—		—		(324)		—
Total revenue		1,440,191		—		59,258		(56,114)		1,443,335
Operating expenses:
Lease operating		10,786		—		—		—		10,786
Gathering, compression, processing, and transportation		211,469		—		4,699		(55,866)		160,302
Production and ad valorem taxes		18,584		—		(7,863)		—		10,721
Marketing		61,799		—		—		—		61,799
Exploration		1,087		—		—		—		1,087
Impairment of unproved properties		8,754		—		—		—		8,754
Depletion, depreciation, and amortization		173,592		—		15,075		—		188,667
Accretion of asset retirement obligations		419		—		—		—		419
General and administrative		48,666		—		11,267		(248)		59,685
Total operating expenses		535,156		—		23,178		(56,114)		502,220
Operating income		905,035		—		36,080		—		941,115
Other income (expenses):
Interest		(59,647)		—		(1,274)		—		(60,921)
Equity in net income of subsidiaries		23,913		—		—		(23,913)		—
Total other expenses		(35,734)		—		(1,274)		(23,913)		(60,921)
Income before income taxes		869,301		—		34,806		(23,913)		880,194
Provision for income tax expense		(335,460)		—		—		—		(335,460)
Net income and comprehensive income including noncontrolling interest		533,841		—		34,806		(23,913)		544,734
Net income and comprehensive income attributable to noncontrolling interest		—		—		—		10,892		10,892
Net income and comprehensive income attributable to Antero Resources Corporation	$	533,841		—		34,806		(34,805)		533,842

Condensed Consolidating Statement of Operations and Comprehensive Income

Three Months Ended September 30, 2016

(In thousands)

	Parent		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminations		Consolidated
Revenue:
Natural gas sales	$	364,373		—		—		—		364,373
Natural gas liquids sales		106,958		—		—		—		106,958
Oil sales		14,793		—		—		—		14,793
Gathering, compression, and water handling and treatment		—		—		150,475		(147,506)		2,969
Marketing		97,076		—		—		—		97,076
Commodity derivative fair value losses		530,334		—		—		—		530,334
Other income		3,990		—		—		(3,990)		—
Total revenue		1,117,524		—		150,475		(151,496)		1,116,503
Operating expenses:
Lease operating		13,710		—		28,978		(28,834)		13,854
Gathering, compression, processing, and transportation		303,753		—		6,400		(75,238)		234,915
Production and ad valorem taxes		17,719		—		(2,165)		—		15,554
Marketing		114,611		—		—		—		114,611
Exploration		1,166		—		—		—		1,166
Impairment of unproved properties		11,753		—		—		—		11,753
Depletion, depreciation, and amortization		172,976		—		26,137		—		199,113
Accretion of asset retirement obligations		628		—		—		—		628
General and administrative		44,637		—		13,315		(375)		57,577
Accretion of contingent acquisition consideration		—		—		3,527		(3,527)		—
Total operating expenses		680,953		—		76,192		(107,974)		649,171
Operating income		436,571		—		74,283		(43,522)		467,332
Other income (expenses):
Equity in earnings of unconsolidated affiliate		—		—		1,543		—		1,543
Interest		(54,631)		—		(5,303)		179		(59,755)
Equity in net income (loss) of subsidiaries		(2,761)		—		—		2,761		—
Total other expenses		(57,392)		—		(3,760)		2,940		(58,212)
Income before income taxes		379,179		—		70,523		(40,582)		409,120
Provision for income tax expense		(140,924)		—		—		—		(140,924)
Net income and comprehensive income including noncontrolling interest		238,255		—		70,523		(40,582)		268,196
Net income and comprehensive income attributable to noncontrolling interest		—		—		—		29,941		29,941
Net income and comprehensive income attributable to Antero Resources Corporation	$	238,255		—		70,523		(70,523)		238,255

Condensed Consolidating Statement of Operations and Comprehensive Income

Nine Months Ended September 30, 2015

(In thousands)

	Parent		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminations		Consolidated
Revenue:
Natural gas sales	$	810,982		—		—		—		810,982
Natural gas liquids sales		188,403		—		—		—		188,403
Oil sales		55,627		—		—		—		55,627
Gathering, compression, and water handling and treatment		6,651		—		168,094		(159,661)		15,084
Marketing		143,242		—		—		—		143,242
Commodity derivative fair value gains		1,836,398		—		—		—		1,836,398
Other income		824		—		—		(824)		—
Total revenue		3,042,127		—		168,094		(160,485)		3,049,736
Operating expenses:
Lease operating		25,561		—		—		—		25,561
Gathering, compression, processing, and transportation		630,708		—		19,792		(159,867)		490,633
Production and ad valorem taxes		57,433		—		25		—		57,458
Marketing		214,201		—		—		—		214,201
Exploration		3,086		—		—		—		3,086
Impairment of unproved properties		43,670		—		—		—		43,670
Depletion, depreciation, and amortization		503,265		—		44,748		—		548,013
Accretion of asset retirement obligations		1,227		—		—		—		1,227
General and administrative		147,858		—		30,685		(618)		177,925
Contract termination and rig stacking		10,902		—		—		—		10,902
Total operating expenses		1,637,911		—		95,250		(160,485)		1,572,676
Operating income		1,404,216		—		72,844		—		1,477,060
Other income (expenses):
Interest		(170,989)		—		(2,940)		—		(173,929)
Equity in net income of subsidiaries		48,381		—		—		(48,381)		—
Total other expenses		(122,608)		—		(2,940)		(48,381)		(173,929)
Income before income taxes		1,281,608		—		69,904		(48,381)		1,303,131
Provision for income tax expense		(498,709)		—		—		—		(498,709)
Net income and comprehensive income including noncontrolling interest		782,899		—		69,904		(48,381)		804,422
Net income and comprehensive income attributable to noncontrolling interest		—		—		—		21,522		21,522
Net income and comprehensive income attributable to Antero Resources Corporation	$	782,899		—		69,904		(69,903)		782,900

Condensed Consolidating Statement of Operations and Comprehensive Income (Loss)

Nine Months Ended September 30, 2016

(In thousands)

	Parent		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminations		Consolidated
Revenue:
Natural gas sales	$	848,936		—		—		—		848,936
Natural gas liquids sales		274,736		—		—		—		274,736
Oil sales		41,712		—		—		—		41,712
Gathering, compression, and water handling and treatment		—		—		423,357		(413,250)		10,107
Marketing		287,194		—		—		—		287,194
Commodity derivative fair value gains		125,624		—		—		—		125,624
Other income		11,714		—		—		(11,714)		—
Total revenue		1,589,916		—		423,357		(424,964)		1,588,309
Operating expenses:
Lease operating		37,299		—		104,009		(104,118)		37,190
Gathering, compression, processing, and transportation		838,936		—		20,567		(209,790)		649,713
Production and ad valorem taxes		51,921		—		375		—		52,296
Marketing		378,521		—		—		—		378,521
Exploration		3,289		—		—		—		3,289
Impairment of unproved properties		47,223		—		—		—		47,223
Depletion, depreciation, and amortization		513,957		—		74,100		—		588,057
Accretion of asset retirement obligations		1,846		—		—		—		1,846
General and administrative		135,356		—		39,712		(1,102)		173,966
Accretion of contingent acquisition consideration		—		—		10,384		(10,384)		—
Total operating expenses		2,008,348		—		249,147		(325,394)		1,932,101
Operating income (loss)		(418,432)		—		174,210		(99,570)		(343,792)
Other income (expenses):
Equity in earnings of unconsolidated affiliate		—		—		2,027		—		2,027
Interest		(173,364)		—		(12,885)		615		(185,634)
Equity in net income of subsidiaries		(2,003)		—		—		2,003		—
Total other expenses		(175,367)		—		(10,858)		2,618		(183,607)
Income (loss) before income taxes		(593,799)		—		163,352		(96,952)		(527,399)
Provision for income tax benefit		230,755		—		—		—		230,755
Net income (loss) and comprehensive income (loss) including noncontrolling interest		(363,044)		—		163,352		(96,952)		(296,644)
Net income and comprehensive income attributable to noncontrolling interest		—		—		—		66,400		66,400
Net income (loss) and comprehensive income (loss) attributable to Antero Resources Corporation	$	(363,044)		—		163,352		(163,352)		(363,044)

Condensed Cash Flow Statement [Table Text Block]

Condensed Consolidating Statement of Cash Flows

Nine Months Ended September 30, 2015

(In thousands)

	Parent		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminations		Consolidated
Net cash provided by operating activities	$	711,020		—		130,134		—		841,154
Cash flows used in investing activities:
Additions to unproved properties		(170,291)		—		—		—		(170,291)
Drilling and completion costs		(1,350,498)		—		—		—		(1,350,498)
Additions to water handling and treatment systems		(79,227)		—		—		—		(79,227)
Additions to gathering systems and facilities		(40,264)		—		(242,549)		—		(282,813)
Additions to other property and equipment		(5,225)		—		—		—		(5,225)
Change in other assets		307		—		10,883		—		11,190
Net distributions to guarantor subsidiary		(115,000)		—		—		115,000		—
Distributions from non-guarantor subsidiary		49,161		—		—		(49,161)		—
Proceeds from contribution of assets to non-guarantor subsidiary		804,630		—		—		(804,630)		—
Proceeds from asset sales		40,000		—		—		—		40,000
Net cash used in investing activities		(866,407)		—		(231,666)		(738,791)		(1,836,864)
Cash flows provided by (used in) financing activities:
Issuance of common stock		537,832		—		—		—		537,832
Issuance of common units by Antero Midstream Partners LP		—		—		240,972		—		240,972
Issuance of senior notes		750,000		—		—		—		750,000
Borrowings (repayments) on bank credit facility, net		(1,115,000)		(115,000)		525,000		—		(705,000)
Payments of deferred financing costs		(15,234)		—		(1,956)		—		(17,190)
Distributions		—		115,000		(875,149)		738,791		(21,358)
Employee tax withholding for settlement of equity compensation awards		(4,554)		—		—		—		(4,554)
Other		(3,544)		—		(17)		—		(3,561)
Net cash provided by (used in) financing activities		149,500		—		(111,150)		738,791		777,141
Net decrease in cash and cash equivalents		(5,887)		—		(212,682)		—		(218,569)
Cash and cash equivalents, beginning of period		15,787		—		230,192		—		245,979
Cash and cash equivalents, end of period	$	9,900		—		17,510		—		27,410

Condensed Consolidating Statement of Cash Flows

Nine Months Ended September 30, 2016

(In thousands)

	Parent		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminations		Consolidated
Net cash provided by operating activities	$	745,517		—		259,135		(98,955)		905,697
Cash flows used in investing activities:
Additions to proved properties		(64,789)		—		—		—		(64,789)
Additions to unproved properties		(559,572)		—		—		—		(559,572)
Drilling and completion costs		(1,108,806)		—		—		98,955		(1,009,851)
Additions to water handling and treatment systems		—		—		(137,355)		—		(137,355)
Additions to gathering systems and facilities		(1,367)		—		(152,769)		—		(154,136)
Additions to other property and equipment		(1,747)		—		—		—		(1,747)
Investments in unconsolidated affiliates		—		—		(45,044)		—		(45,044)
Change in other assets		236		—		(2,409)		—		(2,173)
Net distributions from subsidiaries		78,514		—		—		(78,514)		—
Net cash used in investing activities		(1,657,531)		—		(337,577)		20,441		(1,974,667)
Cash flows provided by financing activities:
Issuance of common stock		837,414		—		—		—		837,414
Issuance of common units by Antero Midstream Partners LP		—		—		19,605		—		19,605
Sale of common units in Antero Midstream Partners LP by Antero Resources Corporation		178,000		—		—		—		178,000
Issuance of senior notes		—		—		650,000		—		650,000
Repayments on bank credit facility, net		(102,000)		—		(450,000)		—		(552,000)
Payments of deferred financing costs		(89)		—		(8,940)		—		(9,029)
Distributions		—		—		(129,752)		78,514		(51,238)
Employee tax withholding for settlement of equity compensation awards		(4,859)		—		(17)		—		(4,876)
Other		(3,751)		—		(116)		—		(3,867)
Net cash provided by financing activities		904,715		—		80,780		78,514		1,064,009
Net increase (decrease) in cash and cash equivalents		(7,299)		—		2,338		—		(4,961)
Cash and cash equivalents, beginning of period		16,590		—		6,883		—		23,473
Cash and cash equivalents, end of period	$	9,291		—		9,221		—		18,512