Income Taxes (Tables)

12 Months Ended

Dec. 31, 2019

Components of Income Tax Expense (Benefit)

The components of income tax benefit (expense) are as follows:

			Successor					Predecessor
	For the		For the		Period from			Period from
	Year Ended		Year Ended		May 5, 2017			January 1, 2017
	December 31,		December 31,		through			through
	2019		2018		December 31, 2017			May 4, 2017
	(In thousands)							(In thousands)
Current taxes:
Federal	$	—	$	—	$	4		$	—
State		50		—		(34	)		17
Total current income tax benefit (expense)		50		—		(30	)		17
Deferred taxes:
Federal		—		—		1,933			71
State		—		—		273			3
Total deferred income tax benefit (expense)		—		—		2,206			74
Total income tax benefit (expense)	$	50	$	—	$	2,176		$	91

Reconciliation of Income Tax Benefit (Provision)

The actual income tax benefit (expense) differs from the expected amount computed by applying the federal statutory corporate tax rate of 21% in 2019, 21% in 2018 and 35% in 2017 as follows:

				Successor						Predecessor
	For the			For the			Period from			Period from
	Year Ended			Year Ended			May 5, 2017			January 1, 2017
	December 31,			December 31,			through			through
	2019			2018			December 31, 2017			May 4, 2017
	(In thousands)									(In thousands)
Expected tax benefit (expense) at federal statutory rate	$	7,402		$	11,468		$	310		$	5,764
State income tax benefit (expense), net of federal benefit		946			1,108			240			30
Non-deductible expenses		(3,659	)		1,328			(187	)		—
Changes in valuation allowances		(4,332	)		(14,194	)		24,767			—
Remeasurement of federal deferred tax assets due rate change		—			—			(22,958	)		—
Pass-through entities (1)		—			—			—			(5,686	)
Non-cash compensation		(367	)		—			—			—
Other		60			290			4			(17	)
Total income tax benefit (expense)	$	50		$	—		$	2,176		$	91

(1)	MEMP, a publicly traded partnership with qualifying income, was a pass-through entity for federal income tax purposes.

Components of Net Deferred Income Tax Liabilities

The Company’s deferred tax position reflects the net tax effects of the temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax reporting. Significant components of the deferred tax assets and liabilities are as follows (in thousands):

	December 31,			December 31,
	2019			2018
Deferred income tax assets:
Property, Plant & Equipment	$	37,075		$	2,208
Net operating loss carryforward		141,534			19,085
Disallowed interest expense		10,627			5,748
Accrued liabilities		1,431			1,387
Other		4,234			307
Total deferred income tax assets:		194,901			28,735
Valuation allowance		(189,941	)		(23,934	)
Net deferred income tax assets		4,960			4,801

Deferred income tax liabilities:
Derivatives	$	2,767		$	4,801
Other		2,193			—
Total deferred income tax liabilities		4,960			4,801

Net deferred income tax liabilities	$	—		$	—