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Impairment Charges
12 Months Ended
Dec. 31, 2019
Impairment or Disposal of Tangible Assets Disclosure [Abstract]  
Impairment Charges
Impairment Charges
We evaluate capitalized costs related to proved properties upon a triggering event (e.g., a significant continued decline in forward commodity prices or significant reduction to development capital) to determine if an impairment of such properties has occurred. Commodity price declines may cause changes to our capital spending levels, production rates, levels of proved reserves and development plans, which may result in an impairment of the carrying value of our proved properties in the future.

For the year ended December 31, 2019, as a result of the filing of our Chapter 11 Cases (see Note 1A) and the uncertainties surrounding the availability of financing that would be available to develop our proved undeveloped reserves, we performed an impairment assessment of our asset groups under ASC 360. As a result, the undiscounted future cash flows related to our NEU proved properties were not in excess of the related carrying value of the asset. Accordingly, we have recorded a non-cash impairment charge of approximately $458 million related to this asset group, reflecting a reduction in the net book value of the proved property in this area to its estimated fair value.
During the fourth quarter of 2018, due to the significant reduction to future development capital in the Permian basin in light of the depressed oil price environment, we recorded non-cash impairment charges of approximately (i) $1,044 million on our proved properties, reflecting a reduction in the net book value of the proved property in this area to its estimated fair value and (ii) $59 million on our unproved properties.
Subsequent to December 31, 2019, the COVID-19 outbreak has had a material impact on the demand for oil and the price of oil has significantly decreased as a result of the decrease in demand and the failure of OPEC and Russia to reach an agreement with respect to production cuts. These recent events will continue to have an impact on oil price volatility, the scale and duration of which remain uncertain. If oil prices remain at or below current levels for an extended period of time, this may result in further impairments of the carrying value of our proved properties in the future.