QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) | |||||||||||||
(Address of principal executive offices) | (Registrant’s telephone number, including area code) | (Zip Code) | ||||||||||||
Securities registered pursuant to Section 12(b) of The Act: | ||||||||||||||
Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||||||||
Large accelerated filer | ☐ | Accelerated filer | ☐ | |||||||||||||||||
☒ | Smaller reporting company | |||||||||||||||||||
Emerging growth company |
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The following is a glossary of certain oil and natural gas industry terms used in this Quarterly Report on Form 10-Q (this “report” or “Quarterly Report”): | |||||
Acidizing | To pump acid into a wellbore to improve a well’s productivity or injectivity. | ||||
Blowout | An uncontrolled flow of reservoir fluids into the wellbore, and sometimes catastrophically to the surface. A blowout may consist of salt water, oil, natural gas or a mixture of these. Blowouts can occur in all types of exploration and production operations, not just during drilling operations. If reservoir fluids flow into another formation and do not flow to the surface, the result is called an underground blowout. If the well experiencing a blowout has significant open-hole intervals, it is possible that the well will bridge over (or seal itself with rock fragments from collapsing formations) down-hole and intervention efforts will be averted. | ||||
Bottomhole assembly | The lower portion of the drillstring, consisting of (from the bottom up in a vertical well) the bit, bit sub, a mud motor (in certain cases), stabilizers, drill collar, heavy-weight drillpipe, jarring devices (“jars”) and crossovers for various threadforms. The bottomhole assembly must provide force for the bit to break the rock (weight on bit), survive a hostile mechanical environment and provide the driller with directional control of the well. Oftentimes the assembly includes a mud motor, directional drilling and measuring equipment, measurements-while-drilling tools, logging-while-drilling tools and other specialized devices. | ||||
Cementing | To prepare and pump cement into place in a wellbore. | ||||
Coiled tubing | A long, continuous length of pipe wound on a spool. The pipe is straightened prior to pushing into a wellbore and rewound to coil the pipe back onto the transport and storage spool. Depending on the pipe diameter (1 in. to 4 1/2 in.) and the spool size, coiled tubing can range from 2,000 ft. to 23,000 ft. (610 m to 6,096 m) or greater length. | ||||
Completion | A generic term used to describe the assembly of down-hole tubulars and equipment required to enable safe and efficient production from an oil or gas well. The point at which the completion process begins may depend on the type and design of the well. | ||||
Directional drilling | The intentional deviation of a wellbore from the path it would naturally take. This is accomplished through the use of whipstocks, bottomhole assembly (BHA) configurations, instruments to measure the path of the wellbore in three-dimensional space, data links to communicate measurements taken down-hole to the surface, mud motors and special BHA components and drill bits, including rotary steerable systems, and drill bits. The directional driller also exploits drilling parameters such as weight on bit and rotary speed to deflect the bit away from the axis of the existing wellbore. In some cases, such as drilling steeply dipping formations or unpredictable deviation in conventional drilling operations, directional-drilling techniques may be employed to ensure that the hole is drilled vertically. While many techniques can accomplish this, the general concept is simple: point the bit in the direction that one wants to drill. The most common way is through the use of a bend near the bit in a down-hole steerable mud motor. The bend points the bit in a direction different from the axis of the wellbore when the entire drillstring is not rotating. By pumping mud through the mud motor, the bit turns while the drillstring does not rotate, allowing the bit to drill in the direction it points. When a particular wellbore direction is achieved, that direction may be maintained by rotating the entire drillstring (including the bent section) so that the bit does not drill in a single direction off the wellbore axis, but instead sweeps around and its net direction coincides with the existing wellbore. Rotary steerable tools allow steering while rotating, usually with higher rates of penetration and ultimately smoother boreholes. | ||||
Down-hole | Pertaining to or in the wellbore (as opposed to being on the surface). | ||||
Down-hole motor | A drilling motor located in the drill string above the drilling bit powered by the flow of drilling mud. Down-hole motors are used to increase the speed and efficiency of the drill bit or can be used to steer the bit in directional drilling operations. Drilling motors have become very popular because of horizontal and directional drilling applications and the day rates for drilling rigs. | ||||
Drilling rig | The machine used to drill a wellbore. | ||||
Drillpipe or Drill pipe | Tubular steel conduit fitted with special threaded ends called tool joints. The drillpipe connects the rig surface equipment with the bottomhole assembly and the bit, both to pump drilling fluid to the bit and to be able to raise, lower and rotate the bottomhole assembly and bit. | ||||
Drillstring or Drill string | The combination of the drillpipe, the bottomhole assembly and any other tools used to make the drill bit turn at the bottom of the wellbore. | ||||
Flowback | The process of allowing fluids to flow from the well following a treatment, either in preparation for a subsequent phase of treatment or in preparation for cleanup and returning the well to production. | ||||
Horizontal drilling | A subset of the more general term “directional drilling,” used where the departure of the wellbore from vertical exceeds about 80 degrees. Note that some horizontal wells are designed such that after reaching true 90-degree horizontal, the wellbore may actually start drilling upward. In such cases, the angle past 90 degrees is continued, as in 95 degrees, rather than reporting it as deviation from vertical, which would then be 85 degrees. Because a horizontal well typically penetrates a greater length of the reservoir, it can offer significant production improvement over a vertical well. | ||||
Hydraulic fracturing | A stimulation treatment routinely performed on oil and gas wells in low permeability reservoirs. Specially engineered fluids are pumped at high pressure and rate into the reservoir interval to be treated, causing a vertical fracture to open. The wings of the fracture extend away from the wellbore in opposing directions according to the natural stresses within the formation. Proppant, such as grains of sand of a particular size, is mixed with the treatment fluid to keep the fracture open when the treatment is complete. Hydraulic fracturing creates high-conductivity communication with a large area of formation and bypasses any damage that may exist in the near-wellbore area. |
Hydrocarbon | A naturally occurring organic compound comprising hydrogen and carbon. Hydrocarbons can be as simple as methane, but many are highly complex molecules, and can occur as gases, liquids or solids. Petroleum is a complex mixture of hydrocarbons. The most common hydrocarbons are natural gas, oil and coal. | ||||
Mesh size | The size of the proppant that is determined by sieving the proppant through screens with uniform openings corresponding to the desired size of the proppant. Each type of proppant comes in various sizes, categorized as mesh sizes, and the various mesh sizes are used in different applications in the oil and natural gas industry. The mesh number system is a measure of the number of equally sized openings per square inch of screen through which the proppant is sieved. | ||||
Mud motors | A positive displacement drilling motor that uses hydraulic horsepower of the drilling fluid to drive the drill bit. Mud motors are used extensively in directional drilling operations. | ||||
Natural gas liquids | Components of natural gas that are liquid at surface in field facilities or in gas processing plants. Natural gas liquids can be classified according to their vapor pressures as low (condensate), intermediate (natural gasoline) and high (liquefied petroleum gas) vapor pressure. | ||||
Nitrogen pumping unit | A high-pressure pump or compressor unit capable of delivering high-purity nitrogen gas for use in oil or gas wells. Two basic types of units are commonly available: a nitrogen converter unit that pumps liquid nitrogen at high pressure through a heat exchanger or converter to deliver high-pressure gas at ambient temperature, and a nitrogen generator unit that compresses and separates air to provide a supply of high pressure nitrogen gas. | ||||
Plugging | The process of permanently closing oil and gas wells no longer capable of producing in economic quantities. Plugging work can be performed with a well servicing rig along with wireline and cementing equipment; however, this service is typically provided by companies that specialize in plugging work. | ||||
Plug | A down-hole packer assembly used in a well to seal off or isolate a particular formation for testing, acidizing, cementing, etc.; also a type of plug used to seal off a well temporarily while the wellhead is removed. | ||||
Pounds per square inch | A unit of pressure. It is the pressure resulting from a one pound force applied to an area of one square inch. | ||||
Pressure pumping | Services that include the pumping of liquids under pressure. | ||||
Producing formation | An underground rock formation from which oil, natural gas or water is produced. Any porous rock will contain fluids of some sort, and all rocks at considerable distance below the Earth’s surface will initially be under pressure, often related to the hydrostatic column of ground waters above the reservoir. To produce, rocks must also have permeability, or the capacity to permit fluids to flow through them. | ||||
Proppant | Sized particles mixed with fracturing fluid to hold fractures open after a hydraulic fracturing treatment. In addition to naturally occurring sand grains, man-made or specially engineered proppants, such as resin-coated sand or high-strength ceramic materials like sintered bauxite, may also be used. Proppant materials are carefully sorted for size and sphericity to provide an efficient conduit for production of fluid from the reservoir to the wellbore. | ||||
Resource play | Accumulation of hydrocarbons known to exist over a large area. | ||||
Shale | A fine-grained, fissile, sedimentary rock formed by consolidation of clay- and silt-sized particles into thin, relatively impermeable layers. | ||||
Tight oil | Conventional oil that is found within reservoirs with very low permeability. The oil contained within these reservoir rocks typically will not flow to the wellbore at economic rates without assistance from technologically advanced drilling and completion processes. Commonly, horizontal drilling coupled with multistage fracturing is used to access these difficult to produce reservoirs. | ||||
Tight sands | A type of unconventional tight reservoir. Tight reservoirs are those which have low permeability, often quantified as less than 0.1 millidarcies. | ||||
Tubulars | A generic term pertaining to any type of oilfield pipe, such as drill pipe, drill collars, pup joints, casing, production tubing and pipeline. | ||||
Unconventional resource | A term for the different manner by which resources are exploited as compared to the extraction of conventional resources. In unconventional drilling, the wellbore is generally drilled to specific objectives within narrow parameters, often across long, lateral intervals within narrow horizontal formations offering greater contact area with the producing formation. Typically, the well is then hydraulically fractured at multiple stages to optimize production. | ||||
Wellbore | The physical conduit from surface into the hydrocarbon reservoir. | ||||
Well stimulation | A treatment performed to restore or enhance the productivity of a well. Stimulation treatments fall into two main groups, hydraulic fracturing treatments and matrix treatments. Fracturing treatments are performed above the fracture pressure of the reservoir formation and create a highly conductive flow path between the reservoir and the wellbore. Matrix treatments are performed below the reservoir fracture pressure and generally are designed to restore the natural permeability of the reservoir following damage to the near wellbore area. Stimulation in shale gas reservoirs typically takes the form of hydraulic fracturing treatments. | ||||
Wireline | A general term used to describe well-intervention operations conducted using single-strand or multi-strand wire or cable for intervention in oil or gas wells. Although applied inconsistently, the term commonly is used in association with electric logging and cables incorporating electrical conductors. | ||||
Workover | The process of performing major maintenance or remedial treatments on an oil or gas well. In many cases, workover implies the removal and replacement of the production tubing string after the well has been killed and a workover rig has been placed on location. Through-tubing workover operations, using coiled tubing, snubbing or slickline equipment, are routinely conducted to complete treatments or well service activities that avoid a full workover where the tubing is removed. This operation saves considerable time and expense. |
The following is a glossary of certain electrical infrastructure industry terms used in this report: | |||||
Distribution | The distribution of electricity from the transmission system to individual customers. | ||||
Substation | A part of an electrical transmission and distribution system that transforms voltage from high to low, or the reverse. | ||||
Transmission | The movement of electrical energy from a generating site, such as a power plant, to an electric substation. |
ASSETS | September 30, | December 31, | ||||||||||||
2021 | 2020 | |||||||||||||
CURRENT ASSETS | (in thousands) | |||||||||||||
Cash and cash equivalents | $ | $ | ||||||||||||
Short-term investment | ||||||||||||||
Accounts receivable, net | ||||||||||||||
Receivables from related parties, net | ||||||||||||||
Inventories | ||||||||||||||
Prepaid expenses | ||||||||||||||
Other current assets | ||||||||||||||
Total current assets | ||||||||||||||
Property, plant and equipment, net | ||||||||||||||
Sand reserves | ||||||||||||||
Operating lease right-of-use assets | ||||||||||||||
Intangible assets, net - customer relationships | ||||||||||||||
Intangible assets, net - trade names | ||||||||||||||
Goodwill | ||||||||||||||
Deferred income tax asset | ||||||||||||||
Other non-current assets | ||||||||||||||
Total assets | $ | $ | ||||||||||||
LIABILITIES AND EQUITY | ||||||||||||||
CURRENT LIABILITIES | ||||||||||||||
Accounts payable | $ | $ | ||||||||||||
Payables to related parties | ||||||||||||||
Accrued expenses and other current liabilities | ||||||||||||||
Current operating lease liability | ||||||||||||||
Current portion of long-term debt | ||||||||||||||
Income taxes payable | ||||||||||||||
Total current liabilities | ||||||||||||||
Long-term debt, net of current portion | ||||||||||||||
Deferred income tax liabilities | ||||||||||||||
Long-term operating lease liability | ||||||||||||||
Asset retirement obligations | ||||||||||||||
Other liabilities | ||||||||||||||
Total liabilities | ||||||||||||||
COMMITMENTS AND CONTINGENCIES (Note 18) | ||||||||||||||
EQUITY | ||||||||||||||
Equity: | ||||||||||||||
Common stock, $ | ||||||||||||||
Additional paid in capital | ||||||||||||||
Retained (deficit) earnings | ( | |||||||||||||
Accumulated other comprehensive loss | ( | ( | ||||||||||||
Total equity | ||||||||||||||
Total liabilities and equity | $ | $ |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2021 | 2020 | 2021 | 2020 | ||||||||||||||||||||
REVENUE | (in thousands, except per share amounts) | ||||||||||||||||||||||
Services revenue | $ | $ | $ | $ | |||||||||||||||||||
Services revenue - related parties | |||||||||||||||||||||||
Product revenue | |||||||||||||||||||||||
Product revenue - related parties | |||||||||||||||||||||||
Total revenue | |||||||||||||||||||||||
COST AND EXPENSES | |||||||||||||||||||||||
Services cost of revenue (exclusive of depreciation, depletion, amortization and accretion of $ | |||||||||||||||||||||||
Services cost of revenue - related parties (exclusive of depreciation, depletion, amortization and accretion of $ | |||||||||||||||||||||||
Product cost of revenue (exclusive of depreciation, depletion, amortization and accretion of $ | |||||||||||||||||||||||
Selling, general and administrative (Note 11) | |||||||||||||||||||||||
Selling, general and administrative - related parties (Note 11) | |||||||||||||||||||||||
Depreciation, depletion, amortization and accretion | |||||||||||||||||||||||
Impairment of goodwill | |||||||||||||||||||||||
Impairment of other long-lived assets | |||||||||||||||||||||||
Total cost and expenses | |||||||||||||||||||||||
Operating loss | ( | ( | ( | ( | |||||||||||||||||||
OTHER INCOME (EXPENSE) | |||||||||||||||||||||||
Interest expense, net | ( | ( | ( | ( | |||||||||||||||||||
Other income (expense), net | |||||||||||||||||||||||
Other income (expense), net - related parties | ( | ||||||||||||||||||||||
Total other income (expense) | |||||||||||||||||||||||
Loss before income taxes | ( | ( | ( | ( | |||||||||||||||||||
Benefit for income taxes | ( | ( | ( | ( | |||||||||||||||||||
Net (loss) income | $ | ( | $ | $ | ( | $ | ( | ||||||||||||||||
OTHER COMPREHENSIVE INCOME (LOSS) | |||||||||||||||||||||||
Foreign currency translation adjustment, net of tax of ($ | ( | ( | |||||||||||||||||||||
Comprehensive (loss) income | $ | ( | $ | $ | ( | $ | ( | ||||||||||||||||
Net (loss) income per share (basic) (Note 14) | $ | ( | $ | $ | ( | $ | ( | ||||||||||||||||
Net (loss) income per share (diluted) (Note 14) | $ | ( | $ | $ | ( | $ | ( | ||||||||||||||||
Weighted average number of shares outstanding (basic) (Note 14) | |||||||||||||||||||||||
Weighted average number of shares outstanding (diluted) (Note 14) | |||||||||||||||||||||||
Three Months Ended September 30, 2021 | ||||||||||||||||||||
Accumulated | ||||||||||||||||||||
Retained | Additional | Other | ||||||||||||||||||
Common Stock | (Deficit) | Paid-In | Comprehensive | |||||||||||||||||
Shares | Amount | Earnings | Capital | Loss | Total | |||||||||||||||
(in thousands) | ||||||||||||||||||||
Balance at June 30, 2021 | $ | $ | ( | $ | $ | ( | $ | |||||||||||||
Stock based compensation | — | — | ||||||||||||||||||
Net loss | — | — | ( | — | — | ( | ||||||||||||||
Other comprehensive loss | — | — | — | — | ( | ( | ||||||||||||||
Balance at September 30, 2021 | $ | $ | ( | $ | $ | ( | $ | |||||||||||||
Three Months Ended September 30, 2020 | ||||||||||||||||||||
Accumulated | ||||||||||||||||||||
Additional | Other | |||||||||||||||||||
Common Stock | Retained | Paid-In | Comprehensive | |||||||||||||||||
Shares | Amount | Earnings | Capital | Loss | Total | |||||||||||||||
(in thousands) | ||||||||||||||||||||
Balance at June 30, 2020 | $ | $ | $ | $ | ( | $ | ||||||||||||||
Stock based compensation | — | — | ||||||||||||||||||
Net income | — | — | — | — | ||||||||||||||||
Other comprehensive income | — | — | — | — | ||||||||||||||||
Balance at September 30, 2020 | $ | $ | $ | $ | ( | $ | ||||||||||||||
Nine Months Ended September 30, 2021 | ||||||||||||||||||||
Accumulated | ||||||||||||||||||||
Retained | Additional | Other | ||||||||||||||||||
Common Stock | (Deficit) | Paid-In | Comprehensive | |||||||||||||||||
Shares | Amount | Earnings | Capital | Loss | Total | |||||||||||||||
(in thousands) | ||||||||||||||||||||
Balance at December 31, 2020 | $ | $ | $ | $ | ( | $ | ||||||||||||||
Stock based compensation | — | — | ||||||||||||||||||
Net loss | — | — | ( | — | — | ( | ||||||||||||||
Other comprehensive income | — | — | — | — | ||||||||||||||||
Balance at September 30, 2021 | $ | $ | ( | $ | $ | ( | $ | |||||||||||||
Nine Months Ended September 30, 2020 | ||||||||||||||||||||
Accumulated | ||||||||||||||||||||
Additional | Other | |||||||||||||||||||
Common Stock | Retained | Paid-In | Comprehensive | |||||||||||||||||
Shares | Amount | Earnings | Capital | Loss | Total | |||||||||||||||
(in thousands) | ||||||||||||||||||||
Balance at December 31, 2019 | $ | $ | $ | $ | ( | $ | ||||||||||||||
Stock based compensation | — | — | ||||||||||||||||||
Net loss | — | — | ( | — | — | ( | ||||||||||||||
Other comprehensive loss | — | — | — | — | ( | ( | ||||||||||||||
Balance at September 30, 2020 | $ | $ | $ | $ | ( | $ |
Nine Months Ended September 30, | |||||||||||
2021 | 2020 | ||||||||||
(in thousands) | |||||||||||
Cash flows from operating activities: | |||||||||||
Net loss | $ | ( | $ | ( | |||||||
Adjustments to reconcile net loss to cash (used in) provided by operating activities: | |||||||||||
Stock based compensation | |||||||||||
Depreciation, depletion, accretion and amortization | |||||||||||
Amortization of coil tubing strings | |||||||||||
Amortization of debt origination costs | |||||||||||
Bad debt expense | |||||||||||
Gain on disposal of property and equipment | ( | ( | |||||||||
Impairment of goodwill | |||||||||||
Impairment of other long-lived assets | |||||||||||
Deferred income taxes | ( | ( | |||||||||
Other | |||||||||||
Changes in assets and liabilities: | |||||||||||
Accounts receivable, net | ( | ( | |||||||||
Receivables from related parties | ( | ||||||||||
Inventories | |||||||||||
Prepaid expenses and other assets | |||||||||||
Accounts payable | ( | ||||||||||
Payables to related parties | ( | ||||||||||
Accrued expenses and other liabilities | ( | ||||||||||
Income taxes payable | ( | ||||||||||
Net cash (used in) provided by operating activities | ( | ||||||||||
Cash flows from investing activities: | |||||||||||
Purchases of property and equipment | ( | ( | |||||||||
Purchases of property and equipment from related parties | ( | ||||||||||
Proceeds from disposal of property and equipment | |||||||||||
Net cash provided by (used in) investing activities | ( | ||||||||||
Cash flows from financing activities: | |||||||||||
Borrowings on long-term debt | |||||||||||
Repayments of long-term debt | ( | ( | |||||||||
Proceeds from sale leaseback transaction | |||||||||||
Payments on sale leaseback transaction | ( | ||||||||||
Principal payments on financing leases and equipment financing notes | ( | ( | |||||||||
Debt issuance costs | ( | ||||||||||
Net cash provided by financing activities | |||||||||||
Effect of foreign exchange rate on cash | ( | ||||||||||
Net change in cash and cash equivalents | ( | ||||||||||
Cash and cash equivalents at beginning of period | |||||||||||
Cash and cash equivalents at end of period | $ | $ | |||||||||
Supplemental disclosure of cash flow information: | |||||||||||
Cash paid for interest | $ | $ | |||||||||
Cash paid for income taxes, net of refunds received | $ | $ | |||||||||
Supplemental disclosure of non-cash transactions: | |||||||||||
Purchases of property and equipment included in accounts payable and accrued expenses | $ | $ |
Balance, January 1, 2020 | $ | |||||||
Additions charged to bad debt expense | ||||||||
Additions charged to other selling, general and administrative expense | ||||||||
Additions charged to other (expense) income, net - related parties | ||||||||
Recoveries of receivables previously charged to bad debt expense | ( | |||||||
Deductions for uncollectible receivables written off | ( | |||||||
Balance, December 31, 2020 | ||||||||
Additions charged to bad debt expense | ||||||||
Additions charged to revenue | ||||||||
Additions charged to other selling, general and administrative expense | ||||||||
Additions charged to other income (expense), net - related parties | ||||||||
Additions charged to other income (expense), net | ||||||||
Recoveries of receivables previously charged to bad debt expense | ( | |||||||
Deductions for uncollectible receivables written off | ( | |||||||
Balance, September 30, 2021 | $ |
REVENUES | ACCOUNTS RECEIVABLE | |||||||||||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | At September 30, | At December 31, | |||||||||||||||||||||||
2021 | 2020 | 2021 | 2020 | 2021 | 2020 | |||||||||||||||||||||
Customer A(a) | % | % | % | % | % | % | ||||||||||||||||||||
Customer B(b) | % | % | % | % | % | % | ||||||||||||||||||||
Customer C(c) | % | % | % | % | % | % | ||||||||||||||||||||
Customer D(d) | % | % | % | % | % | % |
Balance, December 31, 2019 | $ | |||||||
Deduction for recognition of revenue | ( | |||||||
Increase for deferral of shortfall payments | ||||||||
Increase for deferral of customer prepayments | ||||||||
Balance, December 31, 2020 | ||||||||
Deduction for recognition of revenue | ( | |||||||
Increase for deferral of shortfall payments | ||||||||
Increase for deferral of customer prepayments | ||||||||
Balance, September 30, 2021 | $ |
September 30, | December 31, | |||||||||||||
2021 | 2020 | |||||||||||||
Supplies | $ | $ | ||||||||||||
Raw materials | ||||||||||||||
Work in process | ||||||||||||||
Finished goods | ||||||||||||||
Total inventories | $ | $ |
September 30, | December 31, | ||||||||||||||||
Useful Life | 2021 | 2020 | |||||||||||||||
Pressure pumping equipment | $ | $ | |||||||||||||||
Drilling rigs and related equipment | |||||||||||||||||
Machinery and equipment | |||||||||||||||||
Buildings(a) | |||||||||||||||||
Vehicles, trucks and trailers | |||||||||||||||||
Coil tubing equipment | |||||||||||||||||
Land | N/A | ||||||||||||||||
Land improvements | |||||||||||||||||
Rail improvements | |||||||||||||||||
Other property and equipment(b) | |||||||||||||||||
Deposits on equipment and equipment in process of assembly(c) | |||||||||||||||||
Less: accumulated depreciation(d) | |||||||||||||||||
Total property, plant and equipment, net | $ | $ |
Water transfer equipment | $ | ||||
Crude oil hauling equipment | |||||
Coil tubing equipment | |||||
Flowback equipment | |||||
Rental equipment | |||||
Other equipment | |||||
Total impairment of other long-lived assets | $ |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2021 | 2020 | 2021 | 2020 | ||||||||||||||||||||
Depreciation expense | $ | $ | $ | $ | |||||||||||||||||||
Depletion expense | |||||||||||||||||||||||
Amortization expense | |||||||||||||||||||||||
Accretion expense | |||||||||||||||||||||||
Depreciation, depletion, amortization and accretion | $ | $ | $ | $ |
Infrastructure | Well Completion | Sand | Other | Total | |||||||||||||||||||||||||
Balance as of January 1, 2020 | |||||||||||||||||||||||||||||
Goodwill | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
Accumulated impairment losses | ( | ( | ( | ( | |||||||||||||||||||||||||
Acquisitions | |||||||||||||||||||||||||||||
Impairment losses | ( | ( | ( | ||||||||||||||||||||||||||
Balance as of December 31, 2020 | |||||||||||||||||||||||||||||
Goodwill | |||||||||||||||||||||||||||||
Accumulated impairment losses | ( | ( | ( | ( | |||||||||||||||||||||||||
Acquisitions | |||||||||||||||||||||||||||||
Impairment losses | |||||||||||||||||||||||||||||
Balance as of September 30, 2021 | |||||||||||||||||||||||||||||
Goodwill | |||||||||||||||||||||||||||||
Accumulated impairment losses | ( | ( | ( | ( | |||||||||||||||||||||||||
$ | $ | $ | $ | $ |
September 30, | December 31, | ||||||||||
2021 | 2020 | ||||||||||
Customer relationships | $ | $ | |||||||||
Trade names | |||||||||||
Less: accumulated amortization - customer relationships | ( | ( | |||||||||
Less: accumulated amortization - trade names | ( | ( | |||||||||
Intangible assets, net | $ | $ |
Remainder of 2021 | $ | |||||||
2022 | ||||||||
2023 | ||||||||
2024 | ||||||||
2025 | ||||||||
Thereafter | ||||||||
$ |
September 30, | December 31, | |||||||||||||
2021 | 2020 | |||||||||||||
Accrued legal settlement(a) | $ | $ | ||||||||||||
State and local taxes payable | ||||||||||||||
Deferred revenue | ||||||||||||||
Sale leaseback liability(b) | ||||||||||||||
Accrued compensation and benefits | ||||||||||||||
Payroll tax liability | ||||||||||||||
Financing leases | ||||||||||||||
Insurance reserves | ||||||||||||||
Financed insurance premiums(c) | ||||||||||||||
Other | ||||||||||||||
Total accrued expenses and other current liabilities | $ | $ | ||||||||||||
Other Long-Term Liabilities | ||||||||||||||
Sale leaseback liability(b) | $ | $ | ||||||||||||
Financing leases | ||||||||||||||
Payroll tax liability | ||||||||||||||
Other | ||||||||||||||
Total other long-term liabilities | $ | $ |
September 30, | December 31, | |||||||||||||
2021 | 2020 | |||||||||||||
Revolving credit facility | $ | $ | ||||||||||||
Aviation note | ||||||||||||||
Unamortized debt issuance costs | ( | ( | ||||||||||||
Total debt | ||||||||||||||
Less: current portion | ||||||||||||||
Total long-term debt | $ | $ |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2021 | 2020 | 2021 | 2020 | ||||||||||||||||||||
Cash expenses: | |||||||||||||||||||||||
Compensation and benefits | $ | $ | $ | $ | |||||||||||||||||||
Professional services | |||||||||||||||||||||||
Other(a) | |||||||||||||||||||||||
Total cash SG&A expense | |||||||||||||||||||||||
Non-cash expenses: | |||||||||||||||||||||||
Bad debt provision(b) | |||||||||||||||||||||||
Stock based compensation | |||||||||||||||||||||||
Total non-cash SG&A expense | |||||||||||||||||||||||
Total SG&A expense | $ | $ | $ | $ |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2021 | 2020 | 2021 | 2020 | ||||||||||||||||||||
Operating lease expense | $ | $ | $ | $ | |||||||||||||||||||
Short-term lease expense | |||||||||||||||||||||||
Finance lease expense: | |||||||||||||||||||||||
Amortization of right-of-use assets | |||||||||||||||||||||||
Interest on lease liabilities | |||||||||||||||||||||||
Total lease expense | $ | $ | $ | $ |
September 30, | December 31, | ||||||||||
2021 | 2020 | ||||||||||
Operating leases: | |||||||||||
Operating lease right-of-use assets | $ | $ | |||||||||
Current operating lease liability | |||||||||||
Long-term operating lease liability | |||||||||||
Finance leases: | |||||||||||
$ | $ | ||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2021 | 2020 | 2021 | 2020 | ||||||||||||||||||||
Cash paid for amounts included in the measurement of lease liabilities: | |||||||||||||||||||||||
Operating cash flows from operating leases | $ | $ | $ | $ | |||||||||||||||||||
Operating cash flows from finance leases | |||||||||||||||||||||||
Financing cash flows from finance leases | |||||||||||||||||||||||
Right-of-use assets obtained in exchange for lease obligations: | |||||||||||||||||||||||
Operating leases | $ | $ | ( | $ | $ | ( | |||||||||||||||||
Finance leases |
September 30, | December 31, | ||||||||||
2021 | 2020 | ||||||||||
Weighted-average remaining lease term: | |||||||||||
Operating leases | |||||||||||
Finance leases | |||||||||||
Weighted-average discount rate: | |||||||||||
Operating leases | % | % | |||||||||
Finance leases | % | % |
Operating Leases | Finance Leases | ||||||||||
Remainder of 2021 | $ | $ | |||||||||
2022 | |||||||||||
2023 | |||||||||||
2024 | |||||||||||
2025 | |||||||||||
Thereafter | |||||||||||
Total lease payments | |||||||||||
Less: Present value discount | |||||||||||
Present value of lease payments | $ | $ |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2021 | 2020 | 2021 | 2020 | ||||||||||||||||||||
Basic (loss) earnings per share: | |||||||||||||||||||||||
Allocation of (loss) earnings: | |||||||||||||||||||||||
Net (loss) income | $ | ( | $ | $ | ( | $ | ( | ||||||||||||||||
Weighted average common shares outstanding | |||||||||||||||||||||||
Basic (loss) earnings per share | $ | ( | $ | $ | ( | $ | ( | ||||||||||||||||
Diluted (loss) earnings per share: | |||||||||||||||||||||||
Allocation of (loss) earnings: | |||||||||||||||||||||||
Net (loss) income | $ | ( | $ | $ | ( | $ | ( | ||||||||||||||||
Weighted average common shares, including dilutive effect(a) | |||||||||||||||||||||||
Diluted (loss) earnings per share | $ | ( | $ | $ | ( | $ | ( |
Number of Unvested Restricted Shares | Weighted Average Grant-Date Fair Value | |||||||||||||
Unvested shares as of January 1, 2020 | $ | |||||||||||||
Granted | ||||||||||||||
Vested | ( | |||||||||||||
Forfeited | ( | |||||||||||||
Unvested shares as of December 31, 2020 | ||||||||||||||
Granted | ||||||||||||||
Vested | ( | |||||||||||||
Forfeited | ||||||||||||||
Unvested shares as of September 30, 2021 | $ |
Three Months Ended September 30, | Nine Months Ended September 30, | At September 30, | At December 31, | ||||||||||||||||||||||||||
2021 | 2020 | 2021 | 2020 | 2021 | 2020 | ||||||||||||||||||||||||
REVENUES | ACCOUNTS RECEIVABLE | ||||||||||||||||||||||||||||
Pressure Pumping and Gulfport | (a) | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||
Muskie and Gulfport | (b) | ||||||||||||||||||||||||||||
SR Energy and Gulfport | (c) | ||||||||||||||||||||||||||||
Panther Drilling and El Toro | (d) | ||||||||||||||||||||||||||||
Cobra Aviation/ARS/Leopard and Brim Equipment | (e) | ||||||||||||||||||||||||||||
Other | |||||||||||||||||||||||||||||
$ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
OTHER | ACCOUNTS RECEIVABLE | ||||||||||||||||||||||||||||
Pressure Pumping and Gulfport | (a) | $ | $ | $ | ( | $ | $ | $ | |||||||||||||||||||||
Muskie and Gulfport | (b) | ( | |||||||||||||||||||||||||||
$ | $ | $ | ( | $ | $ | $ | |||||||||||||||||||||||
$ | $ |
Three Months Ended September 30, | Nine Months Ended September 30, | At September 30, | At December 31, | ||||||||||||||||||||||||||
2021 | 2020 | 2021 | 2020 | 2021 | 2020 | ||||||||||||||||||||||||
COST OF REVENUE | ACCOUNTS PAYABLE | ||||||||||||||||||||||||||||
Cobra Aviation/ARS/Leopard and Brim Equipment | (a) | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||
Anaconda and Caliber | (b) | ||||||||||||||||||||||||||||
Other | |||||||||||||||||||||||||||||
$ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
SELLING, GENERAL AND ADMINISTRATIVE COSTS | |||||||||||||||||||||||||||||
The Company and Caliber | (b) | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||
Other | |||||||||||||||||||||||||||||
$ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
$ | $ |
September 30, | December 31, | |||||||||||||
2021 | 2020 | |||||||||||||
Bonding program | $ | $ | ||||||||||||
Environmental remediation | ||||||||||||||
Insurance programs | ||||||||||||||
Rail car commitments | ||||||||||||||
Total letters of credit | $ | $ |
Three months ended September 30, 2021 | Infrastructure | Well Completion | Sand | Drilling | All Other | Eliminations | Total | ||||||||||||||||
Revenue from external customers | $ | $ | $ | $ | $ | $ | — | $ | |||||||||||||||
Intersegment revenues | ( | ||||||||||||||||||||||
Total revenue | ( | ||||||||||||||||||||||
Cost of revenue, exclusive of depreciation, depletion, amortization and accretion | |||||||||||||||||||||||
Intersegment cost of revenues | ( | ( | |||||||||||||||||||||
Total cost of revenue | ( | ||||||||||||||||||||||
Selling, general and administrative | |||||||||||||||||||||||
Depreciation, depletion, amortization and accretion | |||||||||||||||||||||||
Impairment of other long-lived assets | |||||||||||||||||||||||
Operating loss | ( | ( | ( | ( | ( | ( | |||||||||||||||||
Interest expense, net | |||||||||||||||||||||||
Other (income) expense, net | ( | ( | ( | ( | ( | ||||||||||||||||||
Income (loss) before income taxes | $ | $ | ( | $ | ( | $ | ( | $ | ( | $ | $ | ( |
Three months ended September 30, 2020 | Infrastructure | Well Completion | Sand | Drilling | All Other | Eliminations | Total | ||||||||||||||||
Revenue from external customers | $ | $ | $ | $ | $ | $ | — | $ | |||||||||||||||
Intersegment revenues | ( | ||||||||||||||||||||||
Total revenue | ( | ||||||||||||||||||||||
Cost of revenue, exclusive of depreciation, depletion, amortization and accretion | |||||||||||||||||||||||
Intersegment cost of revenues | ( | ||||||||||||||||||||||
Total cost of revenue | ( | ||||||||||||||||||||||
Selling, general and administrative | |||||||||||||||||||||||
Depreciation, depletion, amortization and accretion | |||||||||||||||||||||||
Operating income (loss) | ( | ( | ( | ( | ( | ||||||||||||||||||
Interest expense, net | |||||||||||||||||||||||
Other (income) expense, net | ( | ( | ( | ( | |||||||||||||||||||
Income (loss) before income taxes | $ | $ | $ | ( | $ | ( | $ | ( | $ | $ | ( |
Nine months ended September 30, 2021 | Infrastructure | Well Completion | Sand | Drilling | All Other | Eliminations | Total | ||||||||||||||||
Revenue from external customers | $ | $ | $ | $ | $ | $ | — | $ | |||||||||||||||
Intersegment revenues | ( | ||||||||||||||||||||||
Total revenue | ( | ||||||||||||||||||||||
Cost of revenue, exclusive of depreciation, depletion, amortization and accretion | |||||||||||||||||||||||
Intersegment cost of revenues | ( | ||||||||||||||||||||||
Total cost of revenue | ( | ||||||||||||||||||||||
Selling, general and administrative | |||||||||||||||||||||||
Depreciation, depletion, amortization and accretion | |||||||||||||||||||||||
Impairment of other long-lived assets | |||||||||||||||||||||||
Operating loss | ( | ( | ( | ( | ( | ( | |||||||||||||||||
Interest expense, net | |||||||||||||||||||||||
Other (income) expense, net | ( | ( | ( | ( | ( | ||||||||||||||||||
Loss before income taxes | $ | ( | $ | ( | $ | ( | $ | ( | $ | ( | $ | $ | ( |
Nine months ended September 30, 2020 | Infrastructure | Well Completion | Sand | Drilling | All Other | Eliminations | Total | ||||||||||||||||
Revenue from external customers | $ | $ | $ | $ | $ | $ | — | $ | |||||||||||||||
Intersegment revenues | ( | ||||||||||||||||||||||
Total revenue | ( | ||||||||||||||||||||||
Cost of revenue, exclusive of depreciation, depletion, amortization and accretion | |||||||||||||||||||||||
Intersegment cost of revenues | ( | ||||||||||||||||||||||
Total cost of revenue | ( | ||||||||||||||||||||||
Selling, general and administrative | |||||||||||||||||||||||
Depreciation, depletion, amortization and accretion | |||||||||||||||||||||||
Impairment of goodwill | |||||||||||||||||||||||
Impairment of other long-lived assets | |||||||||||||||||||||||
Operating loss | ( | ( | ( | ( | ( | ( | |||||||||||||||||
Interest expense, net | |||||||||||||||||||||||
Other (income) expense, net | ( | ( | ( | ( | ( | ||||||||||||||||||
Loss before income taxes | $ | ( | $ | ( | $ | ( | $ | ( | $ | ( | $ | $ | ( |
Infrastructure | Well Completion | Sand | Drilling | All Other | Eliminations | Total | |||||||||||||||||
As of September 30, 2021: | |||||||||||||||||||||||
Total assets | $ | $ | $ | $ | $ | $ | ( | $ | |||||||||||||||
As of December 31, 2020: | |||||||||||||||||||||||
Total assets | $ | $ | $ | $ | $ | $ | ( | $ |
Three Months Ended | |||||||||||
September 30, 2021 | September 30, 2020 | ||||||||||
(in thousands) | |||||||||||
Revenue: | |||||||||||
Infrastructure services | $ | 23,489 | $ | 43,582 | |||||||
Well completion services | 22,732 | 15,765 | |||||||||
Natural sand proppant services | 8,419 | 6,031 | |||||||||
Drilling services | 1,207 | 1,204 | |||||||||
Other services | 6,153 | 4,677 | |||||||||
Eliminations | (4,515) | (725) | |||||||||
Total revenue | 57,485 | 70,534 | |||||||||
Cost of revenue: | |||||||||||
Infrastructure services (exclusive of depreciation and amortization of $4,933 and $7,294, respectively, for the three months ended September 30, 2021 and 2020) | 20,595 | 29,045 | |||||||||
Well completion services (exclusive of depreciation and amortization of $6,538 and $7,189, respectively, for the three months ended September 30, 2021 and 2020) | 21,329 | 6,959 | |||||||||
Natural sand proppant services (exclusive of depreciation, depletion and accretion of $2,533 and $2,700, respectively, for the three months ended September 30, 2021 and 2020) | 9,368 | 4,154 | |||||||||
Drilling services (exclusive of depreciation and amortization of $1,942 and $2,294, respectively, for the three months ended September 30, 2021 and 2020) | 1,566 | 1,955 | |||||||||
Other services (exclusive of depreciation and amortization of $3,202 and $3,655, respectively, for the three months ended September 30, 2021 and 2020) | 5,241 | 4,541 | |||||||||
Eliminations | (4,515) | (725) | |||||||||
Total cost of revenue | 53,584 | 45,929 | |||||||||
Selling, general and administrative expenses | 41,866 | 12,180 | |||||||||
Depreciation, depletion, amortization and accretion | 19,148 | 23,132 | |||||||||
Impairment of other long-lived assets | 547 | — | |||||||||
Operating loss | (57,660) | (10,707) | |||||||||
Interest expense, net | (1,484) | (1,098) | |||||||||
Other income (expense), net | 11,056 | 9,042 | |||||||||
Loss before income taxes | (48,088) | (2,763) | |||||||||
Benefit for income taxes | (7,187) | (6,193) | |||||||||
Net (loss) income | $ | (40,901) | $ | 3,430 |
Three Months Ended | |||||||||||
September 30, 2021 | September 30, 2020 | ||||||||||
Cash expenses: | |||||||||||
Compensation and benefits | $ | 3,353 | $ | 3,449 | |||||||
Professional services | 4,571 | 5,651 | |||||||||
Other(a) | 2,252 | 2,163 | |||||||||
Total cash SG&A expense | 10,176 | 11,263 | |||||||||
Non-cash expenses: | |||||||||||
Bad debt provision(b) | 31,449 | 626 | |||||||||
Stock based compensation | 241 | 291 | |||||||||
Total non-cash SG&A expense | 31,690 | 917 | |||||||||
Total SG&A expense | $ | 41,866 | $ | 12,180 |
Nine Months Ended | |||||||||||
September 30, 2021 | September 30, 2020 | ||||||||||
(in thousands) | |||||||||||
Revenue: | |||||||||||
Infrastructure services | $ | 69,965 | $ | 99,307 | |||||||
Well completion services | 63,059 | 75,629 | |||||||||
Natural sand proppant services | 24,011 | 22,516 | |||||||||
Drilling services | 3,288 | 7,182 | |||||||||
Other services | 17,365 | 26,629 | |||||||||
Eliminations | (5,958) | (3,237) | |||||||||
Total revenue | 171,730 | 228,026 | |||||||||
Cost of revenue: | |||||||||||
Infrastructure services (exclusive of depreciation and amortization of $17,499 and $22,416, respectively, for the nine months ended September 30, 2021 and 2020) | 67,029 | 80,977 | |||||||||
Well completion services (exclusive of depreciation and amortization of $19,668 and $23,346, respectively, for the nine months ended September 30, 2021 and 2020) | 47,788 | 41,864 | |||||||||
Natural sand proppant services (exclusive of depreciation, depletion and accretion of $7,059 and $7,380, respectively, for the nine months ended September 30, 2021 and 2020) | 22,631 | 21,845 | |||||||||
Drilling services (exclusive of depreciation of $6,185 and $7,814, respectively, for the nine months ended September 30, 2021 and 2020) | 4,739 | 9,743 | |||||||||
Other services (exclusive of depreciation and amortization of $10,148 and $12,174, respectively, for the nine months ended September 30, 2021 and 2020) | 15,810 | 25,396 | |||||||||
Eliminations | (5,958) | (3,237) | |||||||||
Total cost of revenue | 152,039 | 176,588 | |||||||||
Selling, general and administrative expenses | 74,697 | 36,677 | |||||||||
Depreciation, depletion, amortization and accretion | 60,559 | 73,130 | |||||||||
Impairment of goodwill | — | 54,973 | |||||||||
Impairment of long-lived assets | 547 | 12,897 | |||||||||
Operating loss | (116,112) | (126,239) | |||||||||
Interest expense, net | (3,878) | (4,207) | |||||||||
Other income, net | 5,489 | 25,721 | |||||||||
Loss before income taxes | (114,501) | (104,725) | |||||||||
Benefit for income taxes | (26,370) | (8,979) | |||||||||
Net loss | $ | (88,131) | $ | (95,746) |
Nine Months Ended | |||||||||||
September 30, 2021 | September 30, 2020 | ||||||||||
Cash expenses: | |||||||||||
Compensation and benefits | $ | 11,379 | $ | 11,138 | |||||||
Professional services | 13,783 | 15,335 | |||||||||
Other(a) | 7,058 | 6,572 | |||||||||
Total cash SG&A expenses | 32,220 | 33,045 | |||||||||
Non-cash expenses: | |||||||||||
Bad debt provision | 41,650 | 2,306 | |||||||||
Stock based compensation | 827 | 1,326 | |||||||||
Total non-cash SG&A expenses | 42,477 | 3,632 | |||||||||
Total SG&A expenses | $ | 74,697 | $ | 36,677 |
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||||
Reconciliation of Adjusted EBITDA to net (loss) income: | 2021 | 2020 | 2021 | 2020 | |||||||||||||||||||
Net (loss) income | $ | (40,901) | $ | 3,430 | $ | (88,131) | $ | (95,746) | |||||||||||||||
Depreciation, depletion, amortization and accretion expense | 19,148 | 23,132 | 60,559 | 73,130 | |||||||||||||||||||
Impairment of goodwill | — | — | — | 54,973 | |||||||||||||||||||
Impairment of other long-lived assets | 547 | — | 547 | 12,897 | |||||||||||||||||||
Public offering costs | 13 | — | 91 | — | |||||||||||||||||||
Stock based compensation | 252 | 353 | 950 | 1,598 | |||||||||||||||||||
Interest expense, net | 1,484 | 1,098 | 3,878 | 4,207 | |||||||||||||||||||
Other income, net | (11,056) | (9,042) | (5,489) | (25,721) | |||||||||||||||||||
Benefit for income taxes | (7,187) | (6,193) | (26,370) | (8,979) | |||||||||||||||||||
Interest on trade accounts receivable | 7,963 | 9,285 | 25,138 | 26,052 | |||||||||||||||||||
Adjusted EBITDA | $ | (29,737) | $ | 22,063 | $ | (28,827) | $ | 42,411 |
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||||
Reconciliation of Adjusted EBITDA to net income (loss): | 2021 | 2020 | 2021 | 2020 | |||||||||||||||||||
Net income (loss) | $ | (2,288) | $ | 6,123 | $ | (29,946) | $ | (6,182) | |||||||||||||||
Depreciation and amortization expense | 4,933 | 7,294 | 17,499 | 22,416 | |||||||||||||||||||
Public offering costs | (7) | — | 37 | — | |||||||||||||||||||
Stock based compensation | 96 | 139 | 388 | 424 | |||||||||||||||||||
Interest expense | 971 | 623 | 2,287 | 2,091 | |||||||||||||||||||
Other income, net | (9,256) | (8,375) | (2,663) | (24,082) | |||||||||||||||||||
Provision (benefit) for income taxes | 3,947 | 1,645 | (2,463) | 5,085 | |||||||||||||||||||
Interest on trade accounts receivable | 9,290 | 8,170 | 26,980 | 23,796 | |||||||||||||||||||
Adjusted EBITDA | $ | 7,686 | $ | 15,619 | $ | 12,119 | $ | 23,548 |
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||||
Reconciliation of Adjusted EBITDA to net (loss) income: | 2021 | 2020 | 2021 | 2020 | |||||||||||||||||||
Net (loss) income | $ | (40,711) | $ | 799 | $ | (53,391) | $ | (50,951) | |||||||||||||||
Depreciation and amortization expense | 6,538 | 7,189 | 19,668 | 23,346 | |||||||||||||||||||
Impairment of goodwill | — | — | — | 53,406 | |||||||||||||||||||
Impairment of other long-lived assets | — | — | — | 4,203 | |||||||||||||||||||
Public offering costs | 19 | — | 31 | — | |||||||||||||||||||
Stock based compensation | 95 | 76 | 253 | 458 | |||||||||||||||||||
Interest expense | 215 | 253 | 688 | 857 | |||||||||||||||||||
Other expense (income), net | 755 | (1,156) | 1,196 | (2,444) | |||||||||||||||||||
Interest on trade accounts receivable | (1,327) | 1,073 | (1,841) | 2,206 | |||||||||||||||||||
Adjusted EBITDA | $ | (34,416) | $ | 8,234 | $ | (33,396) | $ | 31,081 |
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||||
Reconciliation of Adjusted EBITDA to net loss: | 2021 | 2020 | 2021 | 2020 | |||||||||||||||||||
Net loss | $ | (4,611) | $ | (3,741) | $ | (9,186) | $ | (12,415) | |||||||||||||||
Depreciation, depletion, amortization and accretion expense | 2,533 | 2,700 | 7,059 | 7,380 | |||||||||||||||||||
Public offering costs | — | — | 12 | — | |||||||||||||||||||
Stock based compensation | 32 | 77 | 163 | 354 | |||||||||||||||||||
Interest expense | 107 | 70 | 291 | 217 | |||||||||||||||||||
Other (income) expense, net | (46) | 1,792 | (892) | 1,753 | |||||||||||||||||||
Interest on trade accounts receivable | — | 26 | (1) | 26 | |||||||||||||||||||
Adjusted EBITDA | $ | (1,985) | $ | 924 | $ | (2,554) | $ | (2,685) |
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||||
Reconciliation of Adjusted EBITDA to net loss: | 2021 | 2020 | 2021 | 2020 | |||||||||||||||||||
Net loss | $ | (2,579) | $ | (3,508) | $ | (8,717) | $ | (13,676) | |||||||||||||||
Depreciation expense | 1,942 | 2,294 | 6,185 | 7,814 | |||||||||||||||||||
Impairment of other long-lived assets | — | — | — | 326 | |||||||||||||||||||
Public offering costs | — | — | 2 | — | |||||||||||||||||||
Stock based compensation | 6 | 38 | 71 | 166 | |||||||||||||||||||
Interest expense | 56 | 60 | 177 | 450 | |||||||||||||||||||
Other (income) expense, net | (66) | 20 | (201) | (251) | |||||||||||||||||||
Adjusted EBITDA | $ | (641) | $ | (1,096) | $ | (2,483) | $ | (5,171) |
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||||
Reconciliation of Adjusted EBITDA to net income (loss): | 2021 | 2020 | 2021 | 2020 | |||||||||||||||||||
Net income (loss) | $ | 9,288 | $ | 3,756 | $ | 13,109 | $ | (12,522) | |||||||||||||||
Depreciation, amortization and accretion expense | 3,202 | 3,655 | 10,148 | 12,174 | |||||||||||||||||||
Impairment of goodwill | — | — | — | 1,567 | |||||||||||||||||||
Impairment of other long-lived assets | 547 | — | 547 | 8,368 | |||||||||||||||||||
Public offering costs | 1 | — | 9 | — | |||||||||||||||||||
Stock based compensation | 23 | 23 | 75 | 196 | |||||||||||||||||||
Interest expense, net | 135 | 92 | 435 | 592 | |||||||||||||||||||
Other income, net | (2,443) | (1,323) | (2,929) | (697) | |||||||||||||||||||
Benefit for income taxes | (11,134) | (7,838) | (23,907) | (14,064) | |||||||||||||||||||
Interest on trade accounts receivable | — | 16 | — | 25 | |||||||||||||||||||
Adjusted EBITDA | $ | (381) | $ | (1,619) | $ | (2,513) | $ | (4,361) |
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||||
2021 | 2020 | 2021 | 2020 | ||||||||||||||||||||
(in thousands, except per share amounts) | |||||||||||||||||||||||
Net loss, as reported | $ | (40,901) | $ | 3,430 | $ | (88,131) | $ | (95,746) | |||||||||||||||
Impairment of goodwill | — | — | — | 54,973 | |||||||||||||||||||
Impairment of other long-lived assets | 547 | — | 547 | 12,897 | |||||||||||||||||||
Adjusted net loss | $ | (40,354) | $ | 3,430 | $ | (87,584) | $ | (27,876) | |||||||||||||||
Basic loss per share, as reported | $ | (0.88) | $ | 0.07 | $ | (1.90) | $ | (2.10) | |||||||||||||||
Impairment of goodwill | — | — | — | 1.21 | |||||||||||||||||||
Impairment of other long-lived assets | 0.01 | — | 0.01 | 0.28 | |||||||||||||||||||
Adjusted basic loss per share | $ | (0.87) | $ | 0.07 | $ | (1.89) | $ | (0.61) | |||||||||||||||
Diluted loss per share, as reported | $ | (0.88) | $ | 0.07 | $ | (1.90) | $ | (2.10) | |||||||||||||||
Impairment of goodwill | — | — | — | 1.21 | |||||||||||||||||||
Impairment of other long-lived assets | 0.01 | — | 0.01 | 0.28 | |||||||||||||||||||
Adjusted diluted loss per share | $ | (0.87) | $ | 0.07 | $ | (1.89) | $ | (0.61) |
September 30, | December 31, | ||||||||||
2021 | 2020 | ||||||||||
Cash and cash equivalents | $ | 7,953 | $ | 14,822 | |||||||
Revolving credit facility availability | 129,184 | 129,787 | |||||||||
Less outstanding borrowings on credit facility | (76,951) | (78,000) | |||||||||
Less letter of credit facilities (bonding program) | (1,000) | (5,000) | |||||||||
Less letter of credit facilities (insurance programs) | (3,889) | (3,890) | |||||||||
Less letter of credit facilities (environmental remediation) | (3,694) | (3,694) | |||||||||
Less letter of credit facilities (rail car commitments) | (455) | (455) | |||||||||
Net working capital (less cash)(a) | 271,999 | 321,328 | |||||||||
Total | $ | 323,147 | $ | 374,898 |
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||||
2021 | 2020 | 2021 | 2020 | ||||||||||||||||||||
Net cash (used in) provided by operating activities | $ | (20,235) | $ | (5,051) | $ | (15,764) | $ | 1,782 | |||||||||||||||
Net cash provided by (used in) investing activities | 2,184 | 791 | 5,107 | (1,090) | |||||||||||||||||||
Net cash provided by financing activities | 14,994 | 41 | 3,780 | 7,377 | |||||||||||||||||||
Effect of foreign exchange rate on cash | (28) | 80 | 8 | (57) | |||||||||||||||||||
Net change in cash | $ | (3,085) | $ | (4,139) | $ | (6,869) | $ | 8,012 |
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||||
2021 | 2020 | 2021 | 2020 | ||||||||||||||||||||
Infrastructure services(a) | $ | 181 | $ | 178 | $ | 474 | $ | 221 | |||||||||||||||
Well completion services(b) | 2,392 | 698 | 3,192 | 3,752 | |||||||||||||||||||
Natural sand proppant services(c) | 16 | 194 | 429 | 1,069 | |||||||||||||||||||
Drilling services(d) | 4 | 132 | 42 | 199 | |||||||||||||||||||
Other(e) | 172 | 323 | 337 | 708 | |||||||||||||||||||
Total capital expenditures | $ | 2,765 | $ | 1,525 | $ | 4,474 | $ | 5,949 |
Incorporated By Reference | |||||||||||||||||||||||||||||||||||||||||
Exhibit Number | Exhibit Description | Form | Commission File No. | Filing Date | Exhibit No. | Filed Herewith | Furnished Herewith | ||||||||||||||||||||||||||||||||||
8-K | 001-37917 | 11/15/2016 | 3.1 | ||||||||||||||||||||||||||||||||||||||
8-K | 001-37917 | 11/15/2016 | 3.2 | ||||||||||||||||||||||||||||||||||||||
8-K | 001-37917 | 6/9/2020 | 3.1 | ||||||||||||||||||||||||||||||||||||||
S-1/A | 333-213504 | 10/3/2016 | 4.1 | ||||||||||||||||||||||||||||||||||||||
8-K | 001-37917 | 11/15/2016 | 4.1 | ||||||||||||||||||||||||||||||||||||||
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MAMMOTH ENERGY SERVICES, INC. | |||||||||||||||||
Date: | November 5, 2021 | By: | /s/ Arty Straehla | ||||||||||||||
Arty Straehla | |||||||||||||||||
Chief Executive Officer | |||||||||||||||||
Date: | November 5, 2021 | By: | /s/ Mark Layton | ||||||||||||||
Mark Layton | |||||||||||||||||
Chief Financial Officer | |||||||||||||||||
USAGE AMOUNT | APPLICABLE MARGINS FOR LIBOR RATE LOANS | APPLICABLE MARGINS FOR DOMESTIC RATE LOANS | ||||||
If the Usage Amount is less than $40,000,000 | 3.00% | 2.00% | ||||||
If the Usage Amount is equal to or greater than $40,000,000 but equal to or less than $75,000,000 | 3.25% | 2.25% | ||||||
If the Usage Amount is greater than $75,000,000 | 3.50% | 2.50% |
PNC BANK, NATIONAL ASSOCIATION, as Lender and as Agent | ||
By: /s/ Ron Zeiber Name: Ron Zieber Title: Senior Vice President Commitment Percentage: 54.054054% Commitment Amount: $64,864,864.86 | ||
BARCLAYS BANK PLC, as a Lender | ||
By: /s/ Sydney G. Dennis Name: Sydney G. Dennis Title: Director Commitment Percentage: 18.918919% Commitment Amount: $22,702,702.70 CREDIT SUISSE AG, Cayman Islands Branch, as a Lender |
UMB BANK, N.A., as a Lender | ||
By: /s/ Thomas J. Zeigler Name: Thomas J. Zeigler Title: Senior Vice President Commitment Percentage: 13.513514% Commitment Amount: $16,216,216.22 |
MAMMOTH ENERGY SERVICES, INC. | |||||||||||
By: | /s/ Arty Straehla | ||||||||||
Arty Straehla | |||||||||||
Chief Executive Officer | |||||||||||
November 5, 2021 | |||||||||||
MAMMOTH ENERGY SERVICES, INC. | |||||||||||
By: | /s/ Mark Layton | ||||||||||
Mark Layton | |||||||||||
Chief Financial Officer | |||||||||||
November 5, 2021 | |||||||||||
MAMMOTH ENERGY SERVICES, INC. | |||||||||||
By: | /s/ Arty Straehla | ||||||||||
Arty Straehla | |||||||||||
Chief Executive Officer | |||||||||||
November 5, 2021 | |||||||||||
MAMMOTH ENERGY SERVICES, INC. | |||||||||||
By: | /s/ Mark Layton | ||||||||||
Mark Layton | |||||||||||
Chief Financial Officer | |||||||||||
November 5, 2021 | |||||||||||
Mine(a) | Section 104 S&S Citations(#) | Section104(b)Orders (#) | Section104(d)Citations and Orders(#) | Section 110(b)(2) Violations(#) | Section107(a)Orders (#) | Proposed Assessments(b)($, amounts in dollars) | Mining Related Fatalities (#) | ||||||||||||||||
Taylor, WI | — | — | — | — | — | $ | — | — | |||||||||||||||
Menomonie, WI | — | — | — | — | — | $ | — | — | |||||||||||||||
New Auburn, WI | — | — | — | — | — | $ | — | — |
CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited) (Parenthetical) - $ / shares |
Sep. 30, 2021 |
Dec. 31, 2020 |
---|---|---|
Statement of Financial Position [Abstract] | ||
Common stock, par value (in USD per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 200,000,000 | 200,000,000 |
Common stock, shares, issued (in shares) | 46,684,065 | 45,769,283 |
Common stock, shares, outstanding (in shares) | 46,684,065 | 45,769,283 |
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (unaudited) - USD ($) shares in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2021 |
Sep. 30, 2020 |
Sep. 30, 2021 |
Sep. 30, 2020 |
|
Revenues [Abstract] | ||||
Revenue | $ 57,485,000 | $ 70,534,000 | $ 171,730,000 | $ 228,026,000 |
COST AND EXPENSES | ||||
Selling, general and administrative | 41,866,000 | 11,979,000 | 74,312,000 | 36,063,000 |
Selling, general and administrative - related parties | 0 | 201,000 | 385,000 | 614,000 |
Depreciation, depletion, amortization and accretion | 19,148,000 | 23,132,000 | 60,559,000 | 73,130,000 |
Impairment of goodwill | 0 | 0 | 0 | 54,973,000 |
Impairment of other long-lived assets | 547,000 | 0 | 547,000 | 12,897,000 |
Total cost and expenses | 115,145,000 | 81,241,000 | 287,842,000 | 354,265,000 |
Operating loss | (57,660,000) | (10,707,000) | (116,112,000) | (126,239,000) |
OTHER INCOME (EXPENSE) | ||||
Interest expense, net | (1,484,000) | (1,098,000) | (3,878,000) | (4,207,000) |
Other income (expense), net | 11,056,000 | 7,943,000 | 6,004,000 | 23,489,000 |
Other income (expense), net - related parties | 0 | 1,099,000 | (515,000) | 2,232,000 |
Total other income (expense) | 9,572,000 | 7,944,000 | 1,611,000 | 21,514,000 |
Loss before income taxes | (48,088,000) | (2,763,000) | (114,501,000) | (104,725,000) |
Benefit for income taxes | (7,187,000) | (6,193,000) | (26,370,000) | (8,979,000) |
Net (loss) income | (40,901,000) | 3,430,000 | (88,131,000) | (95,746,000) |
OTHER COMPREHENSIVE INCOME (LOSS) | ||||
Foreign currency translation adjustment, net of tax of ($69), ($749), ($95) and $116, respectively, for the three and nine months ended September 30, 2021 and three and nine months ended September 30, 2020 | (289,000) | 324,000 | 118,000 | (422,000) |
Comprehensive (loss) income | $ (41,190,000) | $ 3,754,000 | $ (88,013,000) | $ (96,168,000) |
Net (loss) income per share (basic) (in USD per share) | $ (0.88) | $ 0.07 | $ (1.90) | $ (2.10) |
Net (loss) income per share (diluted) (in USD per share) | $ (0.88) | $ 0.07 | $ (1.90) | $ (2.10) |
Weighted average number of shares outstanding (basic) (in shares) | 46,683 | 45,764 | 46,342 | 45,603 |
Weighted average number of shares outstanding (diluted) (in shares) | 46,683 | 46,571 | 46,342 | 45,603 |
Services | ||||
Revenues [Abstract] | ||||
Revenue | $ 52,417,000 | $ 55,279,000 | $ 135,975,000 | $ 169,002,000 |
COST AND EXPENSES | ||||
Cost of revenue | 43,538,000 | 41,445,000 | 128,703,000 | 154,397,000 |
Products | ||||
Revenues [Abstract] | ||||
Revenue | 4,467,000 | 4,815,000 | 17,932,000 | 18,171,000 |
COST AND EXPENSES | ||||
Cost of revenue | 9,865,000 | 4,353,000 | 22,939,000 | 21,862,000 |
Related parties | ||||
COST AND EXPENSES | ||||
Selling, general and administrative - related parties | 0 | 201,000 | 385,000 | 614,000 |
OTHER INCOME (EXPENSE) | ||||
Other income (expense), net - related parties | 0 | 1,099,000 | (515,000) | 2,232,000 |
Related parties | Services | ||||
Revenues [Abstract] | ||||
Revenue | 601,000 | 8,565,000 | 15,678,000 | 35,228,000 |
COST AND EXPENSES | ||||
Cost of revenue | 181,000 | 131,000 | 397,000 | 329,000 |
Related parties | Products | ||||
Revenues [Abstract] | ||||
Revenue | $ 0 | $ 1,875,000 | $ 2,145,000 | $ 5,625,000 |
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (unaudited) (Parenthetical) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2021 |
Sep. 30, 2020 |
Sep. 30, 2021 |
Sep. 30, 2020 |
|
Foreign currency translation adjustment, tax | $ (69) | $ (95) | $ (749) | $ 116 |
Services | ||||
Cost of revenue, depreciation, depletion, amortization and accretion | 35,587 | 20,424 | 53,448 | 65,728 |
Products | ||||
Cost of revenue, depreciation, depletion, amortization and accretion | 4,667 | 2,689 | 7,051 | 7,344 |
Related parties | Services | ||||
Cost of revenue, depreciation, depletion, amortization and accretion | $ 0 | $ 0 | $ 0 | $ 0 |
Organization and Nature of Business |
9 Months Ended |
---|---|
Sep. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Nature of Business | Organization and Nature of Business Mammoth Energy Services, Inc. (“Mammoth Inc.” or the “Company”), together with its subsidiaries, is an integrated, growth-oriented company serving both the oil and gas and the electric utility industries in North America and US territories. Mammoth Inc.’s infrastructure division provides construction, upgrade, maintenance and repair services to various public and private owned utilities. Its oilfield services division provides a diversified set of services to the exploration and production industry including well completion, natural sand and proppant services and drilling services. Additionally, the Company provides aviation services, equipment rentals, crude oil hauling, remote accommodation services, equipment manufacturing and infrastructure engineering and design services. Operations The Company’s infrastructure services include construction, upgrade, maintenance and repair services to the electrical infrastructure industry as well as repair and restoration services in response to storms and other disasters. The Company’s well completion services include equipment and personnel used in connection with the completion and early production of oil and natural gas wells. The Company’s natural sand proppant services include the distribution and production of natural sand proppant that is used primarily for hydraulic fracturing in the oil and gas industry. The Company’s drilling services provide drilling rigs and directional tools for both vertical and horizontal drilling of oil and natural gas wells. The Company also provides other services, including aviation, equipment rentals, crude oil hauling, remote accommodations, equipment manufacturing and infrastructure engineering and design services. All of the Company’s operations are in North America. During the periods presented in this report, the Company provided its infrastructure services primarily in the northeastern, southwestern, midwestern and western portions of the United States. The Company’s infrastructure business depends on infrastructure spending on maintenance, upgrade, expansion and repair and restoration. Any prolonged decrease in spending by electric utility companies, delays or reductions in government appropriations or the failure of customers to pay their receivables could have a material adverse effect on the Company’s results of operations and financial condition. During the periods presented, the Company has operated its oil and natural gas businesses in the Permian Basin, the Utica Shale, the Eagle Ford Shale, the Marcellus Shale, the Granite Wash, the SCOOP, the STACK, the Cana-Woodford Shale, the Cleveland Sand and the oil sands located in Northern Alberta, Canada. The Company’s oil and natural gas business depends in large part on the conditions in the oil and natural gas industry and, specifically, on the amount of capital spending by its customers. Any prolonged increase or decrease in oil and natural gas prices affects the levels of exploration, development and production activity, as well as the entire health of the oil and natural gas industry. Continuation of or further decreases in the commodity prices for oil and natural gas would have a material adverse effect on the Company’s results of operations and financial condition.
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Basis of Presentation and Significant Accounting Policies |
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Basis of Presentation and Significant Accounting Policies | Basis of Presentation and Significant Accounting Policies Basis of Presentation The accompanying unaudited condensed consolidated interim financial statements include the accounts of the Company and its subsidiaries and the variable interest entities (“VIE”) for which the Company is the primary beneficiary. All material intercompany accounts and transactions have been eliminated. This report has been prepared in accordance with the rules and regulations of the Securities and Exchange Commission, and reflects all adjustments, which in the opinion of management are necessary for the fair presentation of the results for the interim periods, on a basis consistent with the annual audited consolidated financial statements. All such adjustments are of a normal, recurring nature. Certain information, accounting policies and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles (“GAAP”) have been omitted pursuant to such rules and regulations, although the Company believes that the disclosures are adequate to make the information presented not misleading. These unaudited condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and the summary of significant accounting policies and notes thereto included in the Company’s most recent annual report on Form 10-K. Accounts Receivable Accounts receivable include amounts due from customers for services performed or goods sold. The Company grants credit to customers in the ordinary course of business and generally does not require collateral. Prior to granting credit to customers, the Company analyzes the potential customer’s risk profile by utilizing a credit report, analyzing macroeconomic factors and using its knowledge of the industry, among other factors. Most areas in the continental United States in which the Company operates provide for a mechanic’s lien against the property on which the service is performed if the lien is filed within the statutorily specified time frame. Customer balances are generally considered delinquent if unpaid by the 30th day following the invoice date and credit privileges may be revoked if balances remain unpaid. Interest on delinquent accounts receivable is recognized in other income when chargeable and collectability is reasonably assured. During the period October 2017 through March 2019, the Company provided infrastructure services in Puerto Rico under master services agreements entered into by Cobra Acquisitions LLC (“Cobra”), one of the Company’s subsidiaries, with the Puerto Rico Electric Power Authority (“PREPA”) to perform repairs to PREPA’s electrical grid as a result of Hurricane Maria. During the three and nine months ended September 30, 2021 and three and nine months ended September 30, 2020, the Company charged interest on delinquent accounts receivable pursuant to the terms of its agreements with PREPA totaling $9.3 million and $27.0 million, respectively, and $8.2 million and $23.8 million, respectively. These amounts are included in “other income (expense), net” on the unaudited condensed consolidated statement of comprehensive loss. Included in “accounts receivable, net” on the unaudited condensed consolidated balance sheets as of September 30, 2021 and December 31, 2020 were interest charges of $101.2 million and $74.3 million, respectively. The Company regularly reviews receivables and provides for expected losses through an allowance for doubtful accounts. In evaluating the level of established reserves, the Company makes judgments regarding its customers’ ability to make required payments, economic events and other factors. As the financial condition of customers changes, circumstances develop, or additional information becomes available, adjustments to the allowance for doubtful accounts may be required. In the event the Company expects that a customer may not be able to make required payments, the Company would increase the allowance through a charge to income in the period in which that determination is made. If it is determined that previously reserved amounts are collectible, the Company would decrease the allowance through a credit to income in the period in which that determination is made. Uncollectible accounts receivable are periodically charged against the allowance for doubtful accounts once a final determination is made regarding their collectability. Following is a roll forward of the allowance for doubtful accounts for the year ended December 31, 2020 and the nine months ended September 30, 2021 (in thousands):
The Company’s subsidiaries Stingray Pressure Pumping LLC (“Stingray Pressure Pumping”) and Muskie Proppant LLC (“Muskie”) were party to a pressure pumping contract and a sand supply contract, respectively, with Gulfport Energy Corporation (“Gulfport”). On November 13, 2020, Gulfport filed petitions for voluntary relief under chapter 11 of the Bankruptcy Code. On May 17, 2021, Gulfport emerged from bankruptcy. As of November 13, 2020, Gulfport owed the Company approximately $46.9 million, which included interest charges of $3.3 million and attorneys’ fees of $1.8 million. FASB ASC 326, Financial Instruments-Credit Losses, requires a company to reflect its current estimate of all expected credit losses. As a result, the Company recorded reserves on its pre-petition receivables due from Gulfport for products and services, interest and attorneys’ fees of $19.4 million, $1.4 million and $1.8 million, respectively, during the year ended December 31, 2020. On March 22, 2021, Gulfport listed the Stingray Pressure Pumping and Muskie contracts on its master rejection schedule filed with the bankruptcy court. During the first quarter of 2021, the Company recognized unliquidated damages of approximately $46.4 million and recorded reserves on these unliquidated damages as a reduction to revenue of $27.1 million and to bad debt expense of $3.8 million. Also during the first quarter of 2021, the Company recorded additional reserves on its pre-petition products and services and interest receivables of $6.1 million and $0.5 million, respectively. On September 21, 2021, the Company and Gulfport reached a settlement under which all litigation relating to the Stingray Pressure Pumping contract and the Muskie contract will be terminated, Stingray Pressure Pumping will release all claims against Gulfport and its subsidiaries with respect to Gulfport’s bankruptcy proceedings, each of the parties will release all claims they had against the others with respect to the litigation matters discussed in Note 18, and Muskie will have an allowed general unsecured claim against Gulfport of $3.1 million. The settlement remains subject to the final approval by the bankruptcy court overseeing Gulfport’s bankruptcy. As a result of the settlement, during the three months ended September 30, 2021, the Company wrote off its remaining receivable related to the Stingray Pressure Pumping claim resulting in bad debt expense and other expense of $31.0 million and $1.3 million, respectively, and recorded additional bad debt expense related to the Muskie claim totaling $0.2 million. The Company had net accounts receivable due from Gulfport totaling $0.1 million as of September 30, 2021, which is included in “accounts receivable, net” on the unaudited condensed consolidated balance sheets. See Note 3. Additionally, the Company has made specific reserves consistent with Company policy which resulted in additions to allowance for doubtful accounts totaling $0.6 million and $3.3 million, respectively, for the nine months ended September 30, 2021 and year ended December 31, 2020. These additions were charged to bad debt expense based on the factors described above. Also, during the nine months ended September 30, 2021 and year ended December 31, 2020, the Company recorded additions to allowance for doubtful accounts of $0.3 million and $2.2 million, respectively, related to insurance claim receivables for its directors and officers liability policy. The Company will continue to pursue collection until such time as final determination is made consistent with Company policy. As of September 30, 2021, PREPA owed Cobra approximately $227.0 million for services performed, excluding $101.2 million of interest charged on these delinquent balances as of September 30, 2021. The Company believes these receivables are collectible. PREPA, however, is currently subject to bankruptcy proceedings, which were filed in July 2017 and are currently pending in the U.S. District Court for the District of Puerto Rico. As a result, PREPA’s ability to meet its payment obligations is largely dependent upon funding from the Federal Emergency Management Agency (“FEMA”) or other sources. On September 30, 2019, Cobra filed a motion with the U.S. District Court for the District of Puerto Rico seeking recovery of the amounts owed to Cobra by PREPA, which motion was stayed by the court. On March 25, 2020, Cobra filed an urgent motion to modify the stay order and allow the recovery of approximately $61.7 million in claims related to a tax gross-up provision contained in the emergency master service agreement, as amended, that was entered into with PREPA on October 19, 2017. This emergency motion was denied on June 3, 2020 and the court extended the stay of our motion. On December 9, 2020, the Court again extended the stay of our motion and directed PREPA to file a status motion by June 7, 2021. On April 6, 2021, Cobra filed a motion to lift the stay order. Following this filing, PREPA initiated discussion with Cobra, which resulted in PREPA and Cobra filing a joint motion to adjourn all deadlines relative to the April 6, 2021 motion until the June 16, 2021 omnibus hearing as a result of PREPA’s understanding that FEMA would release a report in the near future relating to the emergency master service agreement between PREPA and Cobra that was executed on October 19, 2017. The joint motion was granted by the court on April 14, 2021. On May 26, 2021, FEMA issued a Determination Memorandum related to the first contract between Cobra and PREPA in which, among other things, FEMA raised two contract compliance issues and, as a result, concluded that approximately $47 million in costs were not authorized costs under the contract. On June 14, 2021, the Court issued an order adjourning Cobra’s motion to lift the stay order to a hearing on August 4, 2021 and directing Cobra and PREPA to meet and confer in good faith concerning, among other things, (i) the May 26, 2021 Determination Memorandum issued by FEMA and (ii) whether and when a second determination memorandum is expected. The parties were further directed to file an additional status report, which was filed on July 20, 2021. On July 23, 2021, with the aid of Mammoth, PREPA filed an appeal of the entire $47 million that FEMA de-obligated in the May 26, 2021 Determination Memorandum. On August 4, 2021, the Court denied Cobra’s April 6, 2021 motion to lift the stay order, extended the stay of Cobra’s motion seeking recovery of amounts owed to Cobra and directed the parties to file a joint status report by January 19, 2022. In the event PREPA (i) does not have or does not obtain the funds necessary to satisfy its obligations to Cobra under the contracts, (ii) obtains the necessary funds but refuses to pay the amounts owed to the Company or (iii) otherwise does not pay amounts owed to the Company for services performed, the receivable may not be collectible. Concentrations of Credit Risk and Significant Customers Financial instruments that potentially subject the Company to concentrations of credit risk consist of cash and cash equivalents in excess of federally insured limits and trade receivables. Following is a summary of our significant customers based on percentages of total accounts receivable balances at September 30, 2021 and December 31, 2020 and percentages of total revenues derived for the three and nine months ended September 30, 2021 and 2020:
a.Customer A is a third-party customer. The accounts receivable balances from Customer A were derived from the Company’s infrastructure services segment. Accounts receivable for Customer A also includes receivables due for interest charged on delinquent accounts receivable. b.Customer B was a related-party customer until June 29, 2021. Revenues earned from this customer prior to June 29, 2021 are included in services revenue - related parties and product revenue - related parties on the unaudited condensed consolidated statements of comprehensive loss. The related accounts receivable are included in accounts receivable, net on the unaudited condensed consolidated balance sheet at September 30, 2021 and receivables due from related parties, net at December 31, 2020. Revenues and the related accounts receivable balances earned from Customer B were derived from the Company’s well completion services segment, natural sand proppant services segment and other businesses. Accounts receivable for Customer B also includes receivables due for interest charged on delinquent accounts receivable. c.Customer C is a third-party customer. Revenues and the related accounts receivable balances earned from Customer C were derived from the Company’s well completion services segment. d.Customer D is a third-party customer. Revenues and the related accounts receivable balances earned from Customer D were derived from the Company’s infrastructure services segment. Fair Value of Financial Instruments The Company’s financial instruments consist of cash and cash equivalents, trade receivables, trade payables, amounts receivable or payable to related parties and long-term debt. The carrying amount of cash and cash equivalents, trade receivables, receivables from related parties and trade payables approximates fair value because of the short-term nature of the instruments. The fair value of long-term debt approximates its carrying value because the cost of borrowing fluctuates based upon market conditions.
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Revenue |
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Revenue from Contract with Customer [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenue | Revenue The Company’s primary revenue streams include infrastructure services, well completion services, natural sand proppant services, drilling services and other services, which includes coil tubing, pressure control, flowback, cementing, acidizing, equipment rentals, full service transportation, crude oil hauling, remote accommodations, equipment manufacturing and infrastructure engineering and design services. See Note 19 for the Company’s revenue disaggregated by type. Certain of the Company’s customer contracts include provisions entitling the Company to a termination penalty when the customer invokes its contractual right to terminate prior to the contract’s nominal end date. The termination penalties in the customer contracts vary, but are generally considered substantive for accounting purposes and create enforceable rights and obligations throughout the stated duration of the contract. The Company accounts for a contract cancellation as a contract modification in the period in which the customer invokes the termination provision. The determination of the contract termination penalty is based on the terms stated in the related customer agreement. As of the modification date, the Company updates its estimate of the transaction price using the expected value method, subject to constraints, and recognizes the amount over the remaining performance period. Infrastructure Services Infrastructure services are typically provided pursuant to master service agreements, repair and maintenance contracts or fixed price and non-fixed price installation contracts. Pricing under these contracts may be unit priced, cost-plus/hourly (or time and materials basis) or fixed price (or lump sum basis). Generally, the Company accounts for infrastructure services as a single performance obligation satisfied over time. In certain circumstances, the Company supplies materials that are utilized during the jobs as part of the agreement with the customer. The Company accounts for these infrastructure agreements as multiple performance obligations satisfied over time. Revenue is recognized over time as work progresses based on the days completed or as the contract is completed. Under certain customer contracts in our infrastructure services segment, the Company warranties equipment and labor performed for a specified period following substantial completion of the work. Well Completion Services Well completion services are typically provided based upon a purchase order, contract or on a spot market basis. Services are provided on a day rate, contracted or hourly basis. Generally, the Company accounts for well completion services as a single performance obligation satisfied over time. In certain circumstances, the Company supplies proppant that is utilized for pressure pumping as part of the agreement with the customer. The Company accounts for these pressure pumping agreements as multiple performance obligations satisfied over time. Jobs for these services are typically short-term in nature and range from a few hours to multiple days. Generally, revenue is recognized over time upon the completion of each segment of work based upon a completed field ticket, which includes the charges for the services performed, mobilization of the equipment to the location, consumable supplies and personnel. Pursuant to a contract with Gulfport, Stingray Pressure Pumping agreed to provide Gulfport with use of up to two pressure pumping fleets for the period covered by the contract. Under this agreement, performance obligations were satisfied as services were rendered based on the passage of time rather than the completion of each segment of work. Stingray Pressure Pumping had the right to receive consideration from this customer even if circumstances prevent us from performing work. All consideration owed to Stingray Pressure Pumping for services performed during the contractual period is fixed and the right to receive it is unconditional. Gulfport has filed a legal action in Delaware state court seeking the termination of this contract and monetary damages. Further, on November 13, 2020, Gulfport filed petitions for voluntary relief under chapter 11 of the Bankruptcy Code. On March 22, 2021, Gulfport listed the Stingray Pressure Pumping contract on its master rejection schedule filed with the bankruptcy court. The Company determined that these factors changed the scope of the contract, accelerated the duration of, and otherwise changed the rights and obligations of each party to the contract. As a result, the Company accounted for this as a contract modification during the three months ended March 31, 2021. Stingray Pressure Pumping used the expected value method to estimate unliquidated damages totaling $37.9 million, which resulted in the recognition of net revenue totaling $14.8 million and bad debt expense of $2.9 million on previously recognized revenue during the three months ended March 31, 2021. On September 21, 2021, the Company and Gulfport reached a settlement under which all litigation relating to the Stingray Pressure Pumping contract will be terminated. Stingray Pressure Pumping will release all claims against Gulfport and its subsidiaries with respect to Gulfport’s bankruptcy proceedings and each of the parties will release all claims they had against the others with respect to the litigation matters discussed in Note 18. The settlement remains subject to the final approval by the bankruptcy court overseeing Gulfport’s bankruptcy. As a result of this settlement agreement, during the three months ended September 30, 2021, the Company wrote off its remaining receivable related to the Stingray Pressure Pumping claim resulting in bad debt expense and other expense of $31.0 million and $1.3 million, respectively. Gulfport was a related party until June 29, 2021. On June 29, 2021, pursuant to the terms of its plan of reorganization, all of the Company’s shares that Gulfport owned were transferred to a trust for the benefit of certain of Gulfport’s creditors. The revenue recognized related to this agreement is included in “services revenue - related parties” in the accompanying unaudited condensed consolidated statement of comprehensive loss and the related accounts receivable is included in “receivables due from related parties” as of December 31, 2020. See Notes 11 and 18 below. Additional revenue is generated through labor charges and the sale of consumable supplies that are incidental to the service being performed. Such amounts are recognized ratably over the period during which the corresponding goods and services are consumed. Natural Sand Proppant Services The Company sells natural sand proppant through sand supply agreements with its customers. Under these agreements, sand is typically sold at a flat rate per ton or a flat rate per ton with an index-based adjustment. The Company recognizes revenue at the point in time when the customer obtains legal title to the product, which may occur at the production facility, rail origin or at the destination terminal. Certain of the Company’s sand supply agreements contain a minimum volume commitment related to sand purchases whereby the Company charges a shortfall payment if the customer fails to meet the required minimum volume commitment. These agreements may also contain make-up provisions whereby shortfall payments can be applied in future periods against purchased volumes exceeding the minimum volume commitment. If a make-up right exists, the Company has future performance obligations to deliver excess volumes of product in subsequent months. In accordance with ASC 606, if the customer fails to meet the minimum volume commitment, the Company will assess whether it expects the customer to fulfill its unmet commitment during the contractually specified make-up period based on discussions with the customer and management’s knowledge of the business. If the Company expects the customer will make-up deficient volumes in future periods, revenue related to shortfall payments will be deferred and recognized on the earlier of the date on which the customer utilizes make-up volumes or the likelihood that the customer will exercise its right to make-up deficient volumes becomes remote. As of September 30, 2021, the Company had deferred revenue totaling $7.3 million related to shortfall payments. This amount is included in “accrued expenses and other current liabilities” on the unaudited condensed consolidated balance sheet. If the Company does not expect the customer will make-up deficient volumes in future periods, the breakage model will be applied and revenue related to shortfall payments will be recognized when the model indicates the customer’s inability to take delivery of excess volumes. The Company recognized revenue totaling $6.0 million during the nine months ended September 30, 2021, respectively, and $4.9 million and $14.7 million during the three and nine months ended September 30, 2020, respectively, related to shortfall payments. The Company did not recognize any shortfall revenue during the three months ended September 30, 2021. In certain of the Company’s sand supply agreements, the customer obtains control of the product when it is loaded into rail cars and the customer reimburses the Company for all freight charges incurred. The Company has elected to account for shipping and handling as activities to fulfill the promise to transfer the sand. If revenue is recognized for the related product before the shipping and handling activities occur, the Company accrues the related costs of those shipping and handling activities. Pursuant to its contract with Gulfport, Muskie agreed to sell and deliver specified amounts of sand to Gulfport. In September 2020, Muskie filed a lawsuit against Gulfport to recover delinquent payments due under this agreement. On November 13, 2020, Gulfport filed petitions for voluntary relief under chapter 11 of the Bankruptcy Code. On March 22, 2021, Gulfport listed the Muskie contract on its master rejection schedule filed with the bankruptcy court. The Company determined that these factors changed the scope of the contract, accelerated the duration of, and otherwise changed the rights and obligations of each party to the contract. As a result, the Company accounted for this as a contract modification during the three months ended March 31, 2021. Muskie used the expected value method to estimate unliquidated damages totaling $8.5 million, which resulted in the recognition of net revenue totaling $2.1 million and bad debt expense of $1.0 million on previously recognized revenue during the three months ended March 31, 2021. On September 21, 2021, the Company and Gulfport reached a settlement under which all litigation relating to the Muskie contract will be terminated, each of the parties will release all claims they had against the others with respect to the litigation matters discussed in Note 18 and Muskie’s contract claim against Gulfport will be allowed under Gulfport’s plan of reorganization in the amount of $3.1 million. The settlement remains subject to the final approval by the bankruptcy court overseeing Gulfport’s bankruptcy. As a result of this settlement agreement, Muskie recognized bad debt expense of $0.2 million during the three months ended September 30, 2021. As of September 30, 2021, Muskie had net accounts receivable due from Gulfport totaling $0.1 million, which includes a nominal amount of interest on delinquent accounts receivable. Gulfport was a related party until June 29, 2021. The revenue recognized related to this agreement is included in “product revenue - related parties” in the accompanying unaudited condensed consolidated statement of comprehensive loss and the related accounts receivable is included in “accounts receivable, net” in the unaudited condensed consolidated balance sheets as of September 30, 2021 and “receivables due from related parties” as of December 31, 2020. See Notes 11 and 18 below. Drilling Services Contract drilling services were provided under daywork contracts. Directional drilling services, including motor rentals, are provided on a day rate or hourly basis, and revenue is recognized as work progresses. Performance obligations are satisfied over time as the work progresses based on the measure of output. Mobilization revenue and costs were recognized over the days of actual drilling. As a result of market conditions, the Company temporarily shut down its contract land drilling operations beginning in December 2019 and rig hauling operations beginning in April 2020. Other Services During the periods presented, the Company also provided aviation, coil tubing, pressure control, equipment rentals, full service transportation, crude oil hauling, remote accommodations, equipment manufacturing and infrastructure engineering and design services, which are reported under other services. As a result of market conditions, the Company has temporarily shut down its coil tubing and full service transportation operations beginning in July 2020 and its crude oil hauling operations beginning in July 2021. The Company’s other services are typically provided based upon a purchase order, contract or on a spot market basis. Services are provided on a day rate, contracted or hourly basis. Performance obligations for these services are satisfied over time and revenue is recognized as the work progresses based on the measure of output. Jobs for these services are typically short-term in nature and range from a few hours to multiple days. Practical Expedients The Company does not disclose the value of unsatisfied performance obligations for (i) contracts with an original expected length of one year or less and (ii) contracts in which variable consideration is allocated entirely to a wholly unsatisfied performance obligation or to a wholly unsatisfied distinct good or service that forms part of a single performance obligation. Contract Balances Following is a rollforward of the Company’s contract liabilities (in thousands):
The Company did not have any contract assets as of September 30, 2021, December 31, 2020 or December 31, 2019. Performance Obligations Revenue recognized in the current period from performance obligations satisfied in previous periods was a nominal amount for the nine months ended September 30, 2021 and 2020. As of September 30, 2021, the Company had unsatisfied performance obligations totaling $3.8 million, which will be recognized over the next six months.
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Inventories |
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Inventories | InventoriesInventories consist of raw sand and processed sand available for sale, chemicals and other products sold as a bi-product of completion and production operations and supplies used in performing services. Inventory is stated at the lower of cost or net realizable value on an average cost basis. The Company assesses the valuation of its inventories based upon specific usage, future utility, obsolescence and other factors. A summary of the Company’s inventories is shown below (in thousands):
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Property, Plant and Equipment [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property, Plant and Equipment | Property, Plant and Equipment Property, plant and equipment include the following (in thousands):
a. Included in Buildings at each of September 30, 2021 and December 31, 2020 are costs of $7.6 million related to assets under operating leases. b. Included in Other property and equipment at each of September 30, 2021 and December 31, 2020 are costs of $6.0 million related to assets under operating leases. c. Deposits on equipment and equipment in process of assembly represents deposits placed with vendors for equipment that is in the process of assembly and purchased equipment that is being outfitted for its intended use. The equipment is not yet placed in service. d. Includes accumulated depreciation of $6.3 million and $5.0 million at September 30, 2021 and December 31, 2020, respectively, related to assets under operating leases. Impairment Oil prices declined significantly in March 2020 as a result of geopolitical events that increased the supply of oil in the market as well as effects of the COVID-19 pandemic. As a result, the Company determined that it was more likely than not that the fair value of certain of its oilfield services assets were less than their carrying value. Therefore, the Company performed an interim impairment test. As a result of the test, the Company recorded the following impairments to its fixed assets during the first quarter of 2020 (in thousands):
The Company measured the fair values of these assets using direct and indirect observable inputs (Level 2) based on a market approach. The Company did not record any impairment of other long-lived assets during the three and nine months ended September 30, 2021. Disposals Proceeds from customers for horizontal and directional drilling services equipment damaged or lost down-hole are reflected in revenue with the carrying value of the related equipment charged to cost of service revenues and are reported as cash inflows from investing activities in the unaudited condensed consolidated statement of cash flows. For the nine months ended September 30, 2020, proceeds and gains from the sale of equipment damaged or lost down-hole were a nominal amount and $0.7 million, respectively. The Company did not have any proceeds or gains from the sale of equipment damaged or lost down-hole during the three and nine months ended September 30, 2021 and three months ended September 30, 2020. Proceeds from assets sold or disposed of as well as the carrying value of the related equipment are reflected in “other income (expense), net” on the unaudited condensed consolidated statement of comprehensive loss. For the three and nine months ended September 30, 2021 and 2020, proceeds from the sale of equipment were $4.9 million, $9.5 million, $2.7 million and $4.9 million, respectively, and gains (losses) from the sale or disposal of equipment were $3.0 million, $4.6 million, ($0.6) million and $0.2 million, respectively. Depreciation, depletion, amortization and accretion A summary of depreciation, depletion, amortization and accretion expense is below (in thousands):
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Goodwill and Intangible Assets |
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Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Goodwill and Intangible Assets | Goodwill and Intangible Assets Goodwill Changes in the net carrying amount of goodwill by reporting segment (see Note 19) for the nine months ended September 30, 2021 and year ended December 31, 2020 are presented below (in thousands):
Oil prices declined significantly in March 2020 as a result of geopolitical events that increased the supply of oil in the market as well as effects of the COVID-19 pandemic. As a result, the Company determined that it was more likely than not that the fair value of certain of its reporting units were less than their carrying value. Therefore, the Company performed an interim goodwill impairment test. The Company impaired goodwill associated with Stingray Pressure Pumping, Silverback Energy and WTL Oil LLC, resulting in a $55.0 million impairment charge during the first quarter of 2020. To determine fair value, the Company used a combination of the income and market approaches. The income approach estimates the fair value based on anticipated cash flows that are discounted using a weighted average cost of capital. The market approach estimates the fair value using comparative multiples, which involves significant judgment in the selection of the appropriate peer group companies and valuation multiples. The Company did not recognize any goodwill impairment during the three or nine months ended September 30, 2021. Intangible Assets The Company had the following definite lived intangible assets recorded (in thousands):
Amortization expense for intangible assets was $0.2 million and $0.3 million for the three months ended September 30, 2021 and 2020, respectively, and $0.8 million for each of the nine months ended September 30, 2021 and 2020. The original life of customer relationships is six years as of September 30, 2021 with a remaining average useful life of 1.6 years. The original life of trade names ranges from 10 to 20 years as of September 30, 2021 with a remaining average useful life of 5.6 years. Aggregated expected amortization expense for the future periods is expected to be as follows (in thousands): Due to market conditions, the Company has temporarily shut down its crude oil hauling operations beginning in July 2021. As a result, the Company recognized impairment of trade names totaling $0.5 million, which is included in impairment of other long-lived assets on the unaudited condensed statements of comprehensive income (loss).
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Equity Method Investment |
9 Months Ended |
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Sep. 30, 2021 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Equity Method Investment | Equity Method InvestmentOn December 21, 2018, Cobra Aviation Services LLC (“Cobra Aviation”) and Wexford Partners Investment Co. LLC (“Wexford Investment”), a related party, formed a joint venture under the name of Brim Acquisitions LLC (“Brim Acquisitions”) to acquire all outstanding equity interest in Brim Equipment Leasing, Inc. (“Brim Equipment”) for a total purchase price of approximately $2.0 million. Cobra Aviation owns a 49% economic interest and Wexford Investment owns a 51% economic interest in Brim Acquisitions, and each member contributed its pro rata portion of Brim Acquisitions’ initial capital of $2.0 million. Brim Acquisitions, through Brim Equipment, owns four commercial helicopters and leases five commercial helicopters for operations, which it uses to provide a variety of services, including short haul, aerial ignition, hoist operations, aerial photography, fire suppression, construction services, animal/capture/survey, search and rescue, airborne law enforcement, power line construction, precision long line operations, pipeline construction and survey, mineral and seismic exploration, and aerial seeding and fertilization.The Company uses the equity method of accounting to account for its investment in Brim Acquisitions, which had a carrying value of approximately $3.2 million and $3.7 million at September 30, 2021 and December 31, 2020, respectively. The investment is included in “other non-current assets” on the unaudited condensed consolidated balance sheets. The Company recorded equity method adjustments to its investment of a nominal amount and ($0.5) million for the three and nine months ended September 30, 2021, respectively, and $0.5 million and ($0.6) million for the three and nine months ended September 30, 2020, respectively. These amounts are included in “other income (expense), net” on the unaudited condensed consolidated statements of comprehensive loss. |
Accrued Expenses and Other Current Liabilities and Other Long-Term Liabilities |
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Payables and Accruals [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accrued Expenses and Other Current Liabilities and Other Long-Term Liabilities | Accrued Expenses and Other Current Liabilities and Other Long-Term Liabilities Accrued expenses and other current liabilities and other long-term liabilities included the following (in thousands):
a.In June 2021, the Company reached an agreement to settle a certain legal matter. See Note 18 for additional detail. b.On December 30, 2020, the Company entered into an agreement with First National Capital, LLC (“FNC”) whereby the Company agreed to sell certain assets from its infrastructure segment to FNC for aggregate proceeds of $5.0 million. Concurrent with the sale of assets, the Company entered into a 36 month lease agreement whereby the Company agreed to lease back the assets at a monthly rental rate of $0.1 million. On June 1, 2021, the Company entered into another agreement with FNC whereby the Company sold additional assets from its infrastructure segment to FNC for aggregate proceeds of $9.5 million and entered into a 42 month lease agreement whereby the Company agreed to lease back the assets at a monthly rental rate of $0.2 million. Under the agreements, the Company has the option to purchase the assets at the end of the lease terms. The Company recorded liabilities for the proceeds received and will continue to depreciate the assets. The Company has imputed an interest rate so that the carrying amount of the financial liabilities will be the expected repurchase price at the end of the initial lease terms. c.Financed insurance premiums are due in monthly installments, are unsecured and mature within the twelve-month period following the close of the year. As of September 30, 2021 and December 31, 2020, the applicable interest rate associated with financed insurance premiums ranged from 3.45% to 3.75%.
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Debt |
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Debt Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt | Debt Long-term debt included the following (in thousands):
Mammoth Credit Facility On October 19, 2018, Mammoth Inc. and certain of its direct and indirect subsidiaries, as borrowers, entered into an amended and restated revolving credit and security agreement with the lenders party thereto and PNC Bank, National Association, as a lender and as administrative agent for the lenders, as amended and restated (the “revolving credit facility”). The revolving credit facility matures on October 19, 2023. Borrowings under the revolving credit facility are secured by the assets of Mammoth Inc., inclusive of the subsidiary companies, and are subject to a borrowing base calculation prepared monthly. The revolving credit facility also contains various customary affirmative and restrictive covenants. Among the covenants are two financial covenants, including a maximum leverage ratio (2.5 to 1.0) and a minimum fixed charges coverage ratio of at least 1.1 to 1.0. At September 30, 2021, there were outstanding borrowings under the revolving credit facility of $77.0 million and $43.2 million of available borrowing capacity under the facility, after giving effect to $9.0 million of outstanding letters of credit. At December 31, 2020, there were outstanding borrowings under the revolving credit facility of $78.0 million and $38.7 million of borrowing capacity under the facility, after giving effect to $13.0 million of outstanding letters of credit. As of December 31, 2020, the Company was in compliance with its financial covenants under the revolving credit facility. However, as a result of the lack of payment from PREPA, which owed Cobra approximately $328.2 million, including interest, as of September 30, 2021, the Company projected that it would likely breach the leverage ratio covenant contained in its revolving credit facility for the fiscal quarter ended September 30, 2021. On November 3, 2021, the Company entered into a third amendment to its revolving credit facility (the “Third Amendment”) to, among other things, (i) suspend the leverage ratio and fixed charges coverage ratio covenants for the quarters ending September 30, 2021 and December 31, 2021, (ii) permanently reduce the maximum revolving advance amount from $130 million to $120 million, (iii) add a minimum adjusted EBITDA financial covenant of $6.0 million for the quarter ending December 31, 2021, (iv) set the applicable margin on all loans at 3.50% during the limited covenant waiver period, (v) add a requirement to maintain revolver availability of not less than $10.0 million at all times during the limited covenant waiver period, (vi) permanently reduce the maximum revolving advance amount in an amount equal to fifty percent (50%) of any mandatory prepayments made with non-recurring proceeds that are received during the limited covenant waiver period, and (vii) eliminate the declaration of unrestricted subsidiaries during the limited covenant waiver period. The limited covenant waiver period commenced on the effective date of the Third Amendment and ends on the earlier to occur of (i) May 15, 2022, (ii) the Company reporting compliance with both the leverage ratio and the fixed charge coverage ratio covenants for either its fiscal quarter ending September 30, 2021 or December 31, 2021, and (iii) the occurrence of any event of default after the effective date of the Third Amendment. Under the Third Amendment, the Company also agreed to engage an advisor during the limited covenant waiver period to advise the Company and its subsidiaries with regard to, among other things, efforts to achieve certain operation efficiencies, improvement in results of operations, and general business strategy, and provide assistance to the Company and its subsidiaries in the preparation of the supplemental reporting and information required by the Third Amendment. As of November 3, 2021, the Company had $76.1 million in borrowings outstanding under its revolving credit facility, leaving an aggregate of $24.1 million of available borrowing capacity under this facility, after giving effect to $9.0 million of outstanding letters of credit, the $10.0 million reduction in the borrowing base and the requirement to maintain a $10.0 million reserve out of the available borrowing capacity during the limited waiver period. If an event of default occurs under the revolving credit facility and remains uncured, it could have a material adverse effect on the Company’s business, financial condition, liquidity and results of operations. The lenders (i) would not be required to lend any additional amounts to the Company, (ii) could elect to increase the interest rate by 200 basis points, (iii) could elect to declare all outstanding borrowings, together with accrued and unpaid interest and fees, to be due and payable, (iv) may have the ability to require the Company to apply all of its available cash to repay outstanding borrowings, and (v) may foreclose on substantially all of the Company’s assets. Aviation Note On November 6, 2020, Leopard Aviation LLC (“Leopard”) and Cobra Aviation entered into a 39 month promissory note agreement with Bank7 (the “Aviation Note”) in an aggregate principal amount of $4.6 million and received net proceeds of $4.5 million. The Aviation Note bears interest at a rate based on the Wall Street Journal Prime Rate plus a margin of 1%. Principal and interest payments of $0.1 million are due monthly beginning on March 1, 2021, with a final payment of $0.2 million due on February 1, 2024. The Aviation Note is collateralized by Leopard and Cobra Aviation’s assets, including a $1.8 million certificate of deposit. The Aviation Note contains various customary affirmative and restrictive covenants. Included in the affirmative covenants is a minimum cash requirement, which requires Leopard and Cobra Aviation to maintain a minimum of $0.75 million of cash in accounts held by Bank7 until August 1, 2021. As of September 30, 2021, the Company did not meet the minimum debt coverage ratio of 1.25 to 1.0 set forth in the Aviation Note. On November 3, 2021, Bank7 granted the Company a waiver of this event of default. The waiver extended the minimum cash requirement until February 15, 2022.
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Variable Interest Entities |
9 Months Ended |
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Sep. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Variable Interest Entities | Variable Interest Entities Dire Wolf Energy Services LLC (“Dire Wolf”) and Predator Aviation LLC (“Predator Aviation”), wholly owned subsidiaries of the Company, are party to Voting Trust Agreements with TVPX Aircraft Solutions Inc. (the “Voting Trustee”). Under the Voting Trust Agreements, Dire Wolf transferred 100% of its membership interest in Cobra Aviation and Predator Aviation transferred 100% of its membership interest in Leopard to the respective Voting Trustees in exchange for Voting Trust Certificates. Dire Wolf and Predator Aviation retained the obligation to absorb all expected returns or losses of Cobra Aviation and Leopard. Prior to the transfer of the membership interest to the Voting Trustee, Cobra Aviation was a wholly owned subsidiary of Dire Wolf and Leopard was a wholly owned subsidiary of Predator Aviation. Cobra Aviation owns two helicopters and support equipment, 100% of the equity interest in Air Rescue Systems Corporation (“ARS”) and 49% of the equity interest in Brim Acquisitions. Leopard owns one helicopter. Dire Wolf and Predator Aviation entered into the Voting Trust Agreements in order to meet certain registration requirements. Dire Wolf’s and Predator Aviation’s voting rights are not proportional to their respective obligations to absorb expected returns or losses of Cobra Aviation and Leopard, respectively, and all of Cobra Aviation’s and Leopard’s activities are conducted on behalf of Dire Wolf and Predator Aviation, which have disproportionately fewer voting rights; therefore, Cobra Aviation and Leopard meet the criteria of a VIE. Cobra Aviation and Leopard’s operational activities are directed by Dire Wolf’s and Predator Aviation’s officers and Dire Wolf and Predator Aviation have the option to terminate the Voting Trust Agreements at any time. Therefore, the Company, through Dire Wolf and Predator Aviation, is considered the primary beneficiary of the VIEs and consolidates Cobra Aviation and Leopard at September 30, 2021. |
Selling, General and Administrative Expense |
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Selling, General and Administrative Expense | Selling, General and Administrative Expense Selling, general and administrative (“SG&A”) expense includes of the following (in thousands):
a. Includes travel-related costs, information technology expenses, rent, utilities and other general and administrative-related costs. b. The bad debt provision for the three and nine months ended September 30, 2021, includes $31.2 million and $41.2 million, respectively, related to the Stingray Pressure Pumping and Muskie contracts with Gulfport. See Notes 2 and 18.
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Income Taxes |
9 Months Ended |
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Sep. 30, 2021 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The Company recorded income tax benefit of $26.4 million for the nine months ended September 30, 2021 compared to $9.0 million for the nine months ended September 30, 2020. The Company’s effective tax rate was 23% and 9% for the nine months ended September 30, 2021 and 2020, respectively. The effective tax rate for the nine months ended September 30, 2021 differed from the statutory rate of 21% primarily due to the mix of earnings between the United States and Puerto Rico as well as changes in the valuation allowance. Additionally, the Company recorded an unrecognized tax benefit of $0.9 million during the nine months ended September 30, 2021 related to the 2020 tax year returns in Puerto Rico. It is the Company’s policy to recognize interest and applicable penalties, if any, related to uncertain tax positions in income tax expense. On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security (CARES) Act was enacted and signed into U.S. law in response to the COVID-19 pandemic, and among other things, permits the carryback of certain net operating losses. As a result of the enacted legislation, the Company recognized a $2.4 million net tax expense during the nine months ended September 30, 2020, which consisted of a $4.6 million deferred tax expense and a $7.0 million current tax benefit. This impact, along with the rate impact from non-deductible goodwill impairment, was the primary driver for the difference between the statutory rate of 21% and the effective tax rate for the nine months ended September 30, 2020.
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Leases |
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Leases [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Leases | Leases Lessee Accounting The Company recognized a lease liability equal to the present value of the lease payments and a right-of-use asset representing its right to use the underlying asset for the lease term for all leases with a term in excess of 12 months. For operating leases, lease expense for lease payments is recognized on a straight-line basis over the lease term, while finance leases include both an operating expense and an interest expense component. For all leases with a term of 12 months or less, the Company has elected the practical expedient to not recognize lease assets and liabilities and recognizes lease expense for these short-term leases on a straight-line basis over the lease term. The Company’s operating leases are primarily for rail cars, real estate, and equipment and its finance leases are primarily for machinery and equipment. Generally, the Company does not include renewal or termination options in its assessment of the leases unless extension or termination for certain assets is deemed to be reasonably certain. The accounting for some of the Company’s leases may require significant judgment, which includes determining whether a contract contains a lease, determining the incremental borrowing rates to utilize in the net present value calculation of lease payments for lease agreements which do not provide an implicit rate and assessing the likelihood of renewal or termination options. Lease agreements that contain a lease and non-lease component are generally accounted for as a single lease component. The rate implicit in the Company’s leases is not readily determinable. Therefore, the Company uses its incremental borrowing rate based on information available at the commencement date of its leases in determining the present value of lease payments. The Company’s incremental borrowing rate reflects the estimated rate of interest that it would pay to borrow on a collateralized basis over a similar term an amount equal to the lease payments in a similar economic environment. Lease expense consisted of the following for the three and nine months ended September 30, 2021 and 2020 (in thousands):
Supplemental balance sheet information related to leases as of September 30, 2021 and December 31, 2020 is as follows (in thousands):
Other supplemental information related to leases for the three and nine months ended September 30, 2021 and 2020 and as of September 30, 2021 and December 31, 2020 is as follows (in thousands):
Maturities of lease liabilities as of September 30, 2021 are as follows (in thousands):
Lessor Accounting Certain of the Company’s agreements with its customers for drilling services, aviation services and remote accommodation services contain an operating lease component under ASC 842 because (i) there are identified assets, (ii) the customer obtains substantially all of the economic benefits of the identified assets throughout the period of use and (iii) the customer directs the use of the identified assets throughout the period of use. The Company has elected to apply the practical expedient provided to lessors to combine the lease and non-lease components of a contract where the revenue recognition pattern is the same and where the lease component, when accounted for separately, would be considered an operating lease. The practical expedient also allows a lessor to account for the combined lease and non-lease components under ASC 606, Revenue from Contracts with Customers, when the non-lease component is the predominant element of the combined component. |
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Leases | Leases Lessee Accounting The Company recognized a lease liability equal to the present value of the lease payments and a right-of-use asset representing its right to use the underlying asset for the lease term for all leases with a term in excess of 12 months. For operating leases, lease expense for lease payments is recognized on a straight-line basis over the lease term, while finance leases include both an operating expense and an interest expense component. For all leases with a term of 12 months or less, the Company has elected the practical expedient to not recognize lease assets and liabilities and recognizes lease expense for these short-term leases on a straight-line basis over the lease term. The Company’s operating leases are primarily for rail cars, real estate, and equipment and its finance leases are primarily for machinery and equipment. Generally, the Company does not include renewal or termination options in its assessment of the leases unless extension or termination for certain assets is deemed to be reasonably certain. The accounting for some of the Company’s leases may require significant judgment, which includes determining whether a contract contains a lease, determining the incremental borrowing rates to utilize in the net present value calculation of lease payments for lease agreements which do not provide an implicit rate and assessing the likelihood of renewal or termination options. Lease agreements that contain a lease and non-lease component are generally accounted for as a single lease component. The rate implicit in the Company’s leases is not readily determinable. Therefore, the Company uses its incremental borrowing rate based on information available at the commencement date of its leases in determining the present value of lease payments. The Company’s incremental borrowing rate reflects the estimated rate of interest that it would pay to borrow on a collateralized basis over a similar term an amount equal to the lease payments in a similar economic environment. Lease expense consisted of the following for the three and nine months ended September 30, 2021 and 2020 (in thousands):
Supplemental balance sheet information related to leases as of September 30, 2021 and December 31, 2020 is as follows (in thousands):
Other supplemental information related to leases for the three and nine months ended September 30, 2021 and 2020 and as of September 30, 2021 and December 31, 2020 is as follows (in thousands):
Maturities of lease liabilities as of September 30, 2021 are as follows (in thousands):
Lessor Accounting Certain of the Company’s agreements with its customers for drilling services, aviation services and remote accommodation services contain an operating lease component under ASC 842 because (i) there are identified assets, (ii) the customer obtains substantially all of the economic benefits of the identified assets throughout the period of use and (iii) the customer directs the use of the identified assets throughout the period of use. The Company has elected to apply the practical expedient provided to lessors to combine the lease and non-lease components of a contract where the revenue recognition pattern is the same and where the lease component, when accounted for separately, would be considered an operating lease. The practical expedient also allows a lessor to account for the combined lease and non-lease components under ASC 606, Revenue from Contracts with Customers, when the non-lease component is the predominant element of the combined component. |
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Leases | Leases Lessee Accounting The Company recognized a lease liability equal to the present value of the lease payments and a right-of-use asset representing its right to use the underlying asset for the lease term for all leases with a term in excess of 12 months. For operating leases, lease expense for lease payments is recognized on a straight-line basis over the lease term, while finance leases include both an operating expense and an interest expense component. For all leases with a term of 12 months or less, the Company has elected the practical expedient to not recognize lease assets and liabilities and recognizes lease expense for these short-term leases on a straight-line basis over the lease term. The Company’s operating leases are primarily for rail cars, real estate, and equipment and its finance leases are primarily for machinery and equipment. Generally, the Company does not include renewal or termination options in its assessment of the leases unless extension or termination for certain assets is deemed to be reasonably certain. The accounting for some of the Company’s leases may require significant judgment, which includes determining whether a contract contains a lease, determining the incremental borrowing rates to utilize in the net present value calculation of lease payments for lease agreements which do not provide an implicit rate and assessing the likelihood of renewal or termination options. Lease agreements that contain a lease and non-lease component are generally accounted for as a single lease component. The rate implicit in the Company’s leases is not readily determinable. Therefore, the Company uses its incremental borrowing rate based on information available at the commencement date of its leases in determining the present value of lease payments. The Company’s incremental borrowing rate reflects the estimated rate of interest that it would pay to borrow on a collateralized basis over a similar term an amount equal to the lease payments in a similar economic environment. Lease expense consisted of the following for the three and nine months ended September 30, 2021 and 2020 (in thousands):
Supplemental balance sheet information related to leases as of September 30, 2021 and December 31, 2020 is as follows (in thousands):
Other supplemental information related to leases for the three and nine months ended September 30, 2021 and 2020 and as of September 30, 2021 and December 31, 2020 is as follows (in thousands):
Maturities of lease liabilities as of September 30, 2021 are as follows (in thousands):
Lessor Accounting Certain of the Company’s agreements with its customers for drilling services, aviation services and remote accommodation services contain an operating lease component under ASC 842 because (i) there are identified assets, (ii) the customer obtains substantially all of the economic benefits of the identified assets throughout the period of use and (iii) the customer directs the use of the identified assets throughout the period of use. The Company has elected to apply the practical expedient provided to lessors to combine the lease and non-lease components of a contract where the revenue recognition pattern is the same and where the lease component, when accounted for separately, would be considered an operating lease. The practical expedient also allows a lessor to account for the combined lease and non-lease components under ASC 606, Revenue from Contracts with Customers, when the non-lease component is the predominant element of the combined component. |
(Loss) Earnings Per Share |
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
(Loss) Earnings Per Share | Loss) Earnings Per Share Reconciliations of the components of basic and diluted net (loss) income per common share are presented in the table below (in thousands, except per share data):
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Equity Based Compensation |
9 Months Ended |
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Sep. 30, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Equity Based Compensation | Equity Based Compensation Upon formation of certain operating entities by Wexford and Gulfport, specified members of management (the “Specified Members”) and certain non-employee members (the “Non-Employee Members”) were granted the right to receive distributions from the operating entities after the contribution member’s unreturned capital balance was recovered (referred to as “Payout” provision). On November 24, 2014, the awards were modified in conjunction with the contribution of the operating entities to Mammoth. These awards were not granted in limited or general partner units. The awards are for interests in the distributable earnings of the members of MEH Sub, Mammoth’s majority equity holder. On the closing date of Mammoth Inc.’s initial public offering (“IPO”), the unreturned capital balance of Mammoth’s majority equity holder was not fully recovered from its sale of common stock in the IPO. As a result, Payout did not occur and no compensation cost was recorded. Payout for the remaining awards is expected to occur as the contribution member’s unreturned capital balance is recovered from additional sales by MEH Sub of its shares of the Company’s common stock or from dividend distributions, which is not considered probable until the event occurs. For the Specified Member awards, the unrecognized amount, which represents the fair value of the award as of the modification dates or grant date, was $5.6 million. For the Company’s Non-Employee Member awards, the unrecognized amount, which represents the fair value of the awards as of the date of adoption of ASU 2018-07 was $18.9 million.
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Stock Based Compensation |
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Share-based Payment Arrangement [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock Based Compensation | Stock Based Compensation The 2016 Plan authorizes the Company’s Board of Directors or the compensation committee of the Company’s Board of Directors to grant restricted stock, restricted stock units, stock appreciation rights, stock options and performance awards. There are 4.5 million shares of common stock reserved for issuance under the 2016 Plan. Restricted Stock Units The fair value of restricted stock unit awards was determined based on the fair market value of the Company’s common stock on the date of the grant. This value is amortized over the vesting period. A summary of the status and changes of the unvested shares of restricted stock under the 2016 Plan is presented below.
As of September 30, 2021, there was $1.0 million of total unrecognized compensation cost related to the unvested restricted stock. The cost is expected to be recognized over a weighted average period of approximately 1.2 years. Included in cost of revenue and selling, general and administrative expenses is stock based compensation expense of $0.9 million and $1.6 million, respectively, for the nine months ended September 30, 2021 and 2020.
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Related Party Transactions |
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Related Party Transactions [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Related Party Transactions | Related Party Transactions Transactions between the subsidiaries of the Company, including Stingray Pressure Pumping, Muskie, Stingray Energy Services LLC (“SR Energy”), Panther Drilling Systems LLC (“Panther Drilling”), Anaconda Manufacturing LLC (“Anaconda”), Cobra Aviation, ARS and Leopard and the following companies are included in Related Party Transactions: Gulfport, Wexford, Grizzly Oil Sands ULC (“Grizzly”), El Toro Resources LLC (“El Toro”), Everest Operations Management LLC (“Everest”); Elk City Yard LLC (“Elk City Yard”), Double Barrel Downhole Technologies LLC (“DBDHT”), Caliber Investment Group LLC (“Caliber”) and Brim Equipment. Following is a summary of related party transactions (in thousands):
a.Pressure Pumping provided pressure pumping, stimulation and related completion services to Gulfport. On June 29, 2021, Gulfport ceased to be a related party. See Note 3. b.Muskie agreed to sell and deliver, and Gulfport agreed to purchase, specified annual and monthly amounts of natural sand proppant, subject to certain exceptions specified in the agreement, and pay certain costs and expenses. On June 29, 2021, Gulfport ceased to be a related party. See Note 3. c.SR Energy provided rental services to Gulfport. On June 29, 2021, Gulfport ceased to be a related party. d.Panther provides directional drilling services for El Toro, an entity controlled by Wexford, pursuant to a master service agreement. e.Cobra Aviation, ARS and Leopard lease helicopters to Brim Equipment pursuant to aircraft lease and management agreements.
a.Cobra Aviation, ARS and Leopard lease helicopters to Brim Equipment pursuant to aircraft lease and management agreements. b.Caliber leases office space to Anaconda and Mammoth. On December 21, 2018, Cobra Aviation acquired all outstanding equity interest in ARS and purchased two commercial helicopters, spare parts, support equipment and aircraft documents from Brim Equipment. Following these transactions, and also on December 21, 2018, Cobra Aviation formed a joint venture with Wexford Investments named Brim Acquisitions to acquire all outstanding equity interests in Brim Equipment. Cobra Aviation owns a 49% economic interest and Wexford Investment owns a 51% economic interest in Brim Acquisitions, and each member contributed its pro rata portion of Brim Acquisitions’ initial capital of $2.0 million. Wexford Investments is an entity controlled by Wexford, which owns approximately 48% of the Company’s outstanding common stock.
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Commitments and Contingencies |
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Commitments and Contingencies | Commitments and Contingencies Commitments The Company has entered into agreements with suppliers that contain minimum purchase obligations and agreements to purchase capital equipment. Aggregate future minimum payments under these obligations in effect at September 30, 2021 were approximately $1.5 million. Letters of Credit The Company has various letters of credit that were issued under the Company’s revolving credit agreement which is collateralized by substantially all of the assets of the Company. The letters of credit are categorized below (in thousands):
Insurance The Company has insurance coverage for physical partial loss to its assets, employer’s liability, automobile liability, commercial general liability, workers’ compensation and insurance for other specific risks. The Company has also elected in some cases to accept a greater amount of risk through increased deductibles on certain insurance policies. As of September 30, 2021 and December 31, 2020, the workers’ compensation and automobile liability policies require a deductible per occurrence of up to $0.3 million and $0.1 million, respectively. As of September 30, 2021 and December 31, 2020, the workers’ compensation and auto liability policies contained an aggregate stop loss of $5.4 million. The Company establishes liabilities for the unpaid deductible portion of claims incurred based on estimates. As of September 30, 2021 and December 31, 2020, accrued claims were $1.6 million and $1.9 million, respectively. The Company also has insurance coverage for directors and officers liability. As of September 30, 2021 and December 31, 2020, the directors and officers liability policy had a deductible per occurrence of $1.0 million and an aggregate deductible of $10.0 million. As of September 30, 2021 and December 31, 2020, the Company did not have any accrued claims for directors and officers liability. The Company also self-insures its employee health insurance. The Company has coverage on its self-insurance program in the form of a stop loss of $0.2 million per participant and an aggregate stop-loss of $5.8 million for the calendar year ending December 31, 2021. As of September 30, 2021 and December 31, 2020, accrued claims were $1.2 million and $1.3 million, respectively. These estimates may change in the near term as actual claims continue to develop. Warranty Guarantees Pursuant to certain customer contracts in our infrastructure services segment, the Company warrants equipment and labor performed under the contracts for a specified period following substantial completion of the work. Generally, the warranty is for one year or less. No liabilities were accrued as of September 30, 2021 and December 31, 2020 and no expense was recognized during the nine months ended September 30, 2021 or 2020 related to warranty claims. However, if warranty claims occur, the Company could be required to repair or replace warrantied items, which in most cases are covered by warranties extended from the manufacturer of the equipment. In the event the manufacturer of equipment failed to perform on a warranty obligation or denied a warranty claim made by the Company, the Company could be required to pay for the cost of the repair or replacement. Bonds In the ordinary course of business, the Company is required to provide bid bonds to certain customers in the infrastructure services segment as part of the bidding process. These bonds provide a guarantee to the customer that the Company, if awarded the project, will perform under the terms of the contract. Bid bonds are typically provided for a percentage of the total contract value. Additionally, the Company may be required to provide performance and payment bonds for contractual commitments related to projects in process. These bonds provide a guarantee to the customer that the Company will perform under the terms of a contract and that the Company will pay subcontractors and vendors. If the Company fails to perform under a contract or to pay subcontractors and vendors, the customer may demand that the surety make payments or provide services under the bond. The Company must reimburse the surety for expenses or outlays it incurs. As of September 30, 2021 and December 31, 2020, outstanding bid bonds totaled $0.1 million and $1.0 million, respectively. As of September 30, 2021 and December 31, 2020, outstanding performance and payment bonds totaled $13.5 million and $18.1 million, respectively. The estimated cost to complete projects secured by the performance and payment bonds totaled $0.5 million as of September 30, 2021. Litigation The Company is routinely involved in state and local tax audits. During 2015, the State of Ohio assessed taxes on the purchase of equipment the Company believes is exempt under state law. The Company appealed the assessment and a hearing was held in 2017. As a result of the hearing, the Company received a decision from the State of Ohio. The Company is appealing the decision and while it is not able to predict the outcome of the appeal, this matter is not expected to have a material adverse effect on the Company’s financial position, results of operations or cash flows. On June 19, 2018, Wendco of Puerto Rico Inc. filed a putative class action lawsuit in the Commonwealth of Puerto Rico styled Wendco of Puerto Rico Inc.; Multisystem Restaurant Inc.; Restaurant Operators Inc.; Apple Caribe, Inc.; on their own behalf and in representation of all businesses that conduct business in the Commonwealth of Puerto Rico vs. Mammoth Energy Services Inc.; Cobra Acquisitions, LLC; D. Grimm Puerto Rico, LLC, et al. The plaintiffs allege that the defendants caused power outages in Puerto Rico while performing restoration work on Puerto Rico’s electrical network following Hurricanes Irma and Maria in 2017, thereby interrupting commercial activities and causing economic loss. The Company believes these claims are without merit and will vigorously defend the action. However, at this time, the Company is not able to predict the outcome of this lawsuit or whether it will have a material impact on the Company’s business, financial condition, results of operations or cash flows. Cobra has been served with ten lawsuits from municipalities in Puerto Rico alleging failure to pay construction excise and volume of business taxes. The Government of Puerto Rico’s Central Recovery and Reconstruction Office (“COR3”) has noted the unique nature of work executed by entities such as Cobra in Puerto Rico and that taxes, such as those in these matters, may be eligible for reimbursement by the government. Further, COR3 indicated that it is working to develop a solution that will result in payment of taxes owed to the municipalities without placing an undue burden on entities such as Cobra. The Company continues to work with COR3 to resolve these matters. However, at this time, the Company is not able to predict the outcome of these matters or whether they will have a material impact on the Company’s business, financial condition, results of operations or cash flows. On March 20, 2019, EJ LeJeune, a former employee of ESPADA Logistics and Security Group, LLC and ESPADA Caribbean LLC (together, “ESPADA”) filed a putative collective and class action complaint in LeJeune v. Mammoth Energy Services, Inc. d/b/a Cobra Energy & ESPADA Logistics and Security Group, LLC, Case No. 5:19-cv-00286-JKP-ESC, in the U.S. District Court for the Western District of Texas. On August 5, 2019, the court granted the plaintiff’s motion for leave to amend his complaint, dismissing Mammoth Energy Services, Inc. as a defendant, adding Cobra Acquisitions LLC (“Cobra”) as a defendant, and adding ESPADA Caribbean LLC and two officers of ESPADA—James Jorrie and Jennifer Gay Jorrie—as defendants. The amended complaint alleges that the defendants jointly employed the plaintiff and all similarly situated workers and failed to pay them overtime as required by the Fair Labor Standards Act and Puerto Rico law. The complaint also alleges the following violations of Puerto Rico law: illegal deductions from workers’ wages, failure to timely pay all wages owed, failure to pay a required severance when terminating workers without just cause, failure to pay for all hours worked, failure to provide required meal periods, and failure to pay a statutorily required bonus to eligible workers. Mr. LeJeune seeks to represent a class of workers allegedly employed by one or more defendants and paid a flat amount for each day worked regardless of how many hours were worked. The complaint seeks back wages, including overtime wages owed, liquidated damages equal to the overtime wages owed, attorneys’ fees, costs, and pre- and post-judgment interest. On June 16, 2020, Cobra answered Mr. LeJeune’s amended complaint, denying that it employed Mr. LeJeune and the putative class members and denying that they are entitled to relief from Cobra. All other defendants have also answered the amended complaint. The parties stipulated to conditional certification of a collective action, and on August 14, 2020, the Court ordered that notice be sent to all individuals engaged by ESPADA to provide services to Cobra in Puerto Rico between January 21, 2017 and the present who were paid a day-rate. Notice was sent to putative class members on September 15, 2020, and the opt-in period closed on November 14, 2020. The parties are in discovery. The Company believes these claims are without merit and will vigorously defend the action. However, at this time, the Company is not able to predict the outcome of this lawsuit or whether it will have a material impact on the Company’s business, financial condition, results of operations or cash flows. On April 16, 2019, Christopher Williams, a former employee of Higher Power Electrical, LLC, filed a putative class and collective action complaint titled Christopher Williams, individually and on behalf of all others similarly situated v. Higher Power Electrical, LLC, Cobra Acquisitions LLC, and Cobra Energy LLC in the U.S. District Court for the District of Puerto Rico. On June 24, 2019, the complaint was amended to replace Mr. Williams with Matthew Zeisset as the named plaintiff. The plaintiff alleges that the Company failed to pay overtime wages to a class of workers in compliance with the Fair Labor Standards Act and Puerto Rico law. On August 21, 2019, upon request of the parties, the court stayed proceedings in the lawsuit pending completion of individual arbitration proceedings initiated by Mr. Zeisset and opt-in plaintiffs. The arbitrations remain pending. Other claimants have initiated individual arbitration proceedings asserting similar claims. In May 2020, six arbitrations were held in the related matters. The Company believes these claims are without merit and will vigorously defend the arbitrations. However, at this time, the Company is not able to predict the outcomes of these proceedings or whether they will have a material impact on the Company’s business, financial condition, results of operations or cash flows. In June 2019 and August 2019, the Company was served with three class action lawsuits filed in the Western District of Oklahoma (the “Court”). On September 13, 2019, the court consolidated the three lawsuits under the case caption In re Mammoth Energy Services, Inc. Securities Litigation. On November 12, 2019, the plaintiffs filed their first amended complaint against Mammoth Energy Services, Inc., Arty Straehla, and Mark Layton. Pursuant to their first amended complaint, the plaintiffs brought a consolidated putative federal securities class action on behalf of all investors who purchased or otherwise acquired Mammoth Energy Services, Inc. common stock between October 19, 2017, and June 5, 2019, inclusive. On January 10, 2020, the defendants filed their motion to dismiss the first amended complaint. On March 9, 2020, the plaintiffs filed a second amended complaint for violation of federal securities laws which contains allegations substantially similar to those contained in the plaintiff’s first amended complaint. On March 30, 2020, the defendants filed their motion to dismiss the second amended complaint. On January 26, 2021, the court granted the motion to dismiss in part and denied the motion to dismiss in part. In April 2021 a settlement was reached and motion for preliminary approval was filed, which the Court granted on May 4, 2021. On September 21, 2021, the Court issued a final judgment approving the settlement, which released the defendants from all claims asserted in the litigation, or that could have been asserted arising from the subject matter of the litigation and the purchase or acquisition of Mammoth common stock during the class period in return for a cash payment in the amount of $11.0 million for the benefit of the settlement class. The settlement amount is covered in full under Mammoth’s directors’ and officers’ insurance policy. In September 2019, four derivative lawsuits were filed, two in the Western District of Oklahoma and two in the District of Delaware (the “Court”), purportedly on behalf of the Company against its officers and directors. In October 2019, the plaintiffs in the two Oklahoma actions voluntarily dismissed their respective cases, with one plaintiff refiling his action in the District of Delaware. On September 13, 2019, the Court consolidated the three actions under the case caption In re Mammoth Energy Services, Inc. Consolidated Shareholder Litigation. On January 17, 2020, the plaintiffs filed their consolidated amended shareholder derivative complaint on behalf of Nominal Defendant, Mammoth Energy Services, Inc., and against Arty Straehla, Mark Layton, Arthur Amron, Paul V. Heerwagen IV, Marc McCarthy, Jim Palm, Matthew Ross, Arthur Smith, Gulfport Energy Corporation, and Wexford Capital LP. On October 5, 2021, the plaintiffs and Nominal Defendant Mammoth entered into the Stipulation and Agreement of Settlement (the “Stipulation”) in the derivative action, which was preliminarily approved by the Court on October 28, 2021, and is subject to final approval by the Court. The terms of the Stipulation require that, in exchange for the full release, discharge and dismissal with prejudice of the claims asserted against the defendants in the derivative action, (1) the individual defendants will cause the insurers under Mammoth’s Directors’ and Officers’ (“D&O”) insurance policy (the “D&O insurers”) to pay $1.5 million to Mammoth, which Mammoth will use for general corporate purposes; and (2) Mammoth will adopt certain corporate governance reforms, which will further enhance Mammoth’s current corporate governance policies. Additionally, the Stipulation provides that the individual defendants will cause the D&O insurers to pay, subject to Court approval, a separate payment of $0.5 million to plaintiffs’ counsel for their attorneys’ fees and expenses. The Court has set a hearing date for January 7, 2022 to consider the final approval of the settlement. The final settlement amount is expected to be covered in full under Mammoth’s D&O insurance policy. However, until the Court issues a final order approving the settlement, Mammoth cannot assure you that the derivative action will be settled on the terms set forth herein or at all. On September 10, 2019, the U.S. District Court for the District of Puerto Rico unsealed an indictment that charged the former president of Cobra Acquisitions LLC with conspiracy, wire fraud, false statements and disaster fraud. Two other individuals were also charged in the indictment. The indictment is focused on the interactions between a former FEMA official and the former president of Cobra. Neither the Company nor any of its subsidiaries were charged in the indictment. The Company is continuing to cooperate with the related investigation. Given the uncertainty inherent in the criminal litigation, it is not possible at this time to determine the potential outcome or other potential impacts that the criminal litigation could have on the Company. PREPA has stated in court filings that it may contend the alleged criminal activity affects Cobra’s entitlement to payment under its contracts with PREPA. Subsequent to the indictment, the Company received (i) a preservation request letter from the United States Securities and Exchange Commission (“SEC”) related to documents relevant to an ongoing investigation it is conducting and (ii) a civil investigative demand (“CID”) from the United States Department of Justice (“DOJ”), which requests certain documents and answers to specific interrogatories relevant to an ongoing investigation it is conducting. Both the aforementioned SEC and DOJ investigations are in connection with the issues raised in the criminal matter. Following the resignation of Jonathan Yellen from the Company’s board of directors and the matters raised in the Company’s Form 8-K filed on May 14, 2020, the Company received an expanded preservation request from the SEC. The Company is cooperating with both the SEC and DOJ and is not able to predict the outcome of these investigations or if either will have a material impact on the Company’s business, financial condition, results of operations or cash flows. On September 12, 2019, AL Global Services, LLC (“Alpha Lobo”) filed a second amended third-party petition against the Company in an action styled Jim Jorrie v. Craig Charles, Julian Calderas, Jr., and AL Global Services, LLC v. Jim Jorrie v. Cobra Acquisitions LLC v. ESPADA Logistics & Security Group, LLC, ESPADA Caribbean LLC, Arty Straehla, Ken Kinsey, Jennifer Jorrie, and Mammoth Energy Services, Inc., in the 57th Judicial District in Bexar County, Texas. The petition alleges that the Company should be held vicariously liable under alter ego, agency and respondeat superior theories for Alpha Lobo’s alleged claims against Cobra and Arty Straehla for aiding and abetting, knowing participation in and conspiracy to breach fiduciary duty in connection with Cobra’s execution of an agreement with ESPADA Caribbean, LLC for security services related to Cobra’s work in Puerto Rico. The Company believes these claims are without merit and will vigorously defend the action. However, at this time, the Company is not able to predict the outcome of this lawsuit or whether it will have a material impact on the Company’s business, financial condition, results of operations or cash flows. Additionally, there was a parallel arbitration proceeding that was initiated in which certain Defendants sought a declaratory judgment regarding Cobra’s rights to terminate the Alpha Lobo contract and enter into a new contract with a third-party. On June 24, 2021, the arbitration panel ruled in favor of Cobra. As of September 30, 2021, PREPA owed the Company approximately $227.0 million for services performed, excluding $101.2 million of interest charged on these delinquent balances as of September 30, 2021. The Company believes these receivables are collectible. PREPA, however, is currently subject to bankruptcy proceedings, which were filed in July 2017 and are currently pending in the U.S. District Court for the District of Puerto Rico. As a result, PREPA’s ability to meet its payment obligations is largely dependent upon funding from FEMA or other sources. On September 30, 2019, Cobra filed a motion with the U.S. District Court for the District of Puerto Rico seeking recovery of the amounts owed to Cobra by PREPA, which motion was stayed by the court. On March 25, 2020, Cobra filed an urgent motion to modify the stay order and allow the recovery of approximately $61.7 million in claims related to a tax gross-up provision contained in the emergency master service agreement, as amended, that was entered into with PREPA on October 19, 2017. This emergency motion was denied on June 3, 2020 and the court extended the stay of our motion. On December 9, 2020, the Court again extended the stay of our motion and directed PREPA to file a status motion by June 7, 2021. On April 6, 2021, Cobra filed a motion to lift the stay order. Following this filing, PREPA initiated discussion, which resulted in PREPA and Cobra filing a joint motion to adjourn all deadlines relative to the April 6, 2021 motion until the June 16, 2021 omnibus hearing as a result of PREPA’s understanding that FEMA will release a report in the near future relating to the emergency master service agreement between PREPA and Cobra that was executed on October 19, 2017. The joint motion was granted by the court on April 14, 2021. On May 26, 2021, FEMA issued a Determination Memorandum related to the first contract between Cobra and PREPA in which, among other things, FEMA raised two contract compliance issues and, as a result, concluded that approximately $47 million in costs were not authorized costs under the contract. On June 14, 2021, the Court issued an order adjourning Cobra’s motion to lift the stay order to a hearing on August 4, 2021 and directing Cobra and PREPA to meet and confer in good faith concerning (i) the May 26, 2021 Determination Memorandum issued by FEMA and (ii) whether and when a second determination memorandum is expected. The parties were further directed to file an additional status report, which was filed on July 20, 2021. On July 23, 2021, with the aid of Mammoth, PREPA filed an appeal of the entire $47 million that FEMA de-obligated in the May 26, 2021 Determination Memorandum. On August 4, 2021, the Court extended the stay and ordered a joint status report to be filed on January 19, 2022. In the event PREPA (i) does not have or does not obtain the funds necessary to satisfy its obligations to Cobra under the contracts, (ii) obtains the necessary funds but refuses to pay the amounts owed to the Company or (iii) otherwise does not pay amounts owed to the Company for services performed, the receivable may not be collectible. On December 28, 2019, Gulfport filed a lawsuit against Stingray Pressure Pumping in the Superior Court of the State of Delaware. Pursuant to the complaint, Gulfport seeks to terminate the October 1, 2014, Amended and Restated Master Services Agreement for Pressure Pumping Services between Gulfport and Stingray Pressure Pumping (“MSA”). In addition, Gulfport alleges breach of contract and seeks damages for alleged overpayments and audit costs under the MSA and other fees and expenses associated with this lawsuit. On March 26, 2020, Stingray Pressure Pumping filed a counterclaim against Gulfport seeking to recover unpaid fees and expenses due to Stingray Pressure Pumping under the MSA. In September 2020, Muskie filed a lawsuit against Gulfport to recover delinquent payments due under a natural sand proppant supply contract. These matters were automatically stayed as a result of Gulfport’s bankruptcy filing. On November 13, 2020, Gulfport filed petitions for voluntary relief under chapter 11 of the Bankruptcy Code. Gulfport emerged from bankruptcy on May 17, 2021. As of November 13, 2020, Gulfport owed the Company approximately $46.9 million, which included interest charges of $3.3 million and $1.8 million in attorneys’ fees. FASB ASC 326, Financial Instruments-Credit Losses, requires companies to reflect its current estimate of all expected credit losses. As a result, the Company recorded reserves on its pre-petition receivables due from Gulfport for products and services, interest and attorneys’ fees of $19.4 million, $1.4 million and $1.8 million, respectively, during the year ended December 31, 2020. On March 22, 2021, Gulfport listed the Stingray Pressure Pumping and Muskie contracts on its master rejection schedule filed with the bankruptcy court. During the first quarter of 2021, the Company recognized unliquidated damages of approximately $46.4 million and recorded reserves on these unliquidated damages as a reduction to revenue of $27.1 million and to bad debt expense of $3.8 million. Also during the first quarter of 2021, the Company recorded additional reserves on its pre-petition products and services and interest receivables of $6.1 million and $0.5 million, respectively. On September 21, 2021, the Company and Gulfport reached a settlement under which all litigation relating to the Stingray Pressure Pumping contract and the Muskie contract will be terminated, Stingray Pressure Pumping will release all claims against Gulfport and its subsidiaries with respect to Gulfport’s bankruptcy proceedings, each of the parties will release all claims they had against the others with respect to the litigation matters discussed above and Muskie will have an allowed general unsecured claim against Gulfport of $3.1 million. The settlement remains subject to the final approval by the bankruptcy court overseeing Gulfport’s bankruptcy. As a result, during the three months ended September 30, 2021, the Company wrote off its remaining receivable related to the Stingray Pressure Pumping claim resulting in bad debt expense and other expense of $31.0 million and $1.3 million, respectively, and recorded additional bad debt expense related to the Muskie claim totaling $0.2 million. The Company had net accounts receivable due from Gulfport totaling $0.1 million as of September 30, 2021, which is included in “accounts receivable, net” on the unaudited condensed consolidated balance sheets. See Note 3. On January 21, 2020, MasTec Renewables Puerto Rico, LLC (“MasTec”) filed a lawsuit against Mammoth Inc. and Cobra, in the U.S. District Court for the Southern District of Florida. Pursuant to its complaint, MasTec asserts claims against the Company and Cobra for violations of the federal Racketeer Influenced and Corrupt Organizations Act (“RICO”), tortious interference and violations of a Puerto Rico statute. MasTec alleged that it sustained injuries to its business and property in an unspecified amount because it lost the opportunity to perform work in connection with rebuilding the energy infrastructure in Puerto Rico after Hurricane Maria under a services contract with a maximum value of $500 million due to the Company’s and Cobra’s wrongful interference, payment of bribes, and other inducements to a FEMA official. On April 1, 2020, the defendants filed a motion to dismiss the complaint. On October 14, 2020, the court dismissed the RICO claims, and on November 18, 2020, dismissed the claims arising under the Puerto Rico statute and the cause of action for tortious interference with MasTec’s contract (but not its business relations), and dismissed Mammoth Inc. from the litigation. On August 2, 2021, in order to avoid the risks of further litigation, and with no admission of wrongdoing whatsoever, the Company reached an agreement to settle this matter. Under the terms of the agreement, Cobra paid $6.5 million to MasTec on August 2, 2021 and the Company guaranteed payment, by Cobra, of $9.25 million on both August 1, 2022 and December 1, 2022. The agreement bears interest at rates between 6% and 12% and includes an acceleration clause that requires Cobra to pay within ten days all unpaid amounts if Cobra collects $100 million or more of specified receivables. These amounts are reflected in the accompanying unaudited condensed consolidated balance sheet and in “other income (expense), net” on the accompanying condensed consolidated statement of comprehensive loss. On May 13, 2021, Foreman Electric Services, Inc. (“Foreman”) filed a petition against Mammoth Inc. and Cobra, in the U.S. District Court of Oklahoma County. Pursuant to its complaint, Foreman asserted claims against the Company and Cobra for violations of the federal RICO act, tortious interference and violations of Puerto Rico statutes. Foreman alleged that it sustained injuries to its business and property in the alleged amount of $250 million due to the Company’s and Cobra’s wrongful interference, payment of bribes and other inducements to a FEMA official. On May 18, 2021, the Company removed this action to the United States District Court for the Western District of Oklahoma. On July 29, 2021, Foreman voluntarily dismissed the action without prejudice. The Company is involved in various other legal proceedings in the ordinary course of business. Although the Company cannot predict the outcome of these proceedings, legal matters are subject to inherent uncertainties and there exists the possibility that the ultimate resolution of these matters could have a material adverse effect on the Company’s business, financial condition, results of operations or cash flows. Defined Contribution Plan The Company sponsors a 401(k) defined contribution plan for the benefit of substantially all employees at their date of hire. The plan allows eligible employees to contribute up to 92% of their annual compensation, not to exceed annual limits established by the federal government. The Company makes discretionary matching contributions of up to 3% of an employee’s compensation and may make additional discretionary contributions for eligible employees. For the nine months ended September 30, 2021 and 2020, the Company paid $1.3 million and $1.5 million, respectively, in contributions to the plan.
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Reporting Segments |
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Reporting Segments | Reporting Segments As of September 30, 2021, the Company’s revenues, income before income taxes and identifiable assets are primarily attributable to four reportable segments. The Company principally provides electric infrastructure services to private utilities, public investor-owned utilities and co-operative utilities and services in connection with on-shore drilling of oil and natural gas wells for small to large domestic independent oil and natural gas producers. The Company’s Chief Executive Officer and Chief Financial Officer comprise the Company’s Chief Operating Decision Maker function (“CODM”). Segment information is prepared on the same basis that the CODM manages the segments, evaluates the segment financial statements and makes key operating and resource utilization decisions. Segment evaluation is determined on a quantitative basis based on a function of operating loss less impairment expense, as well as a qualitative basis, such as nature of the product and service offerings and types of customers. As of September 30, 2021, the Company’s four reportable segments include infrastructure services (“Infrastructure”), well completion services (“Well Completion”), natural sand proppant services (“Sand”) and drilling services (“Drilling”). Prior to the year ended December 31, 2020, the Company included Barracuda Logistics LLC in its Well Completion segment, Cobra Aviation, ARS and Leopard in its Infrastructure segment and Mako Acquisitions LLC in its Drilling segment. Based on its assessment of FASB ASC 280, Segment Reporting, guidance at December 31, 2020, the Company changed its presentation in 2020 to move Barracuda to the Sand segment and Cobra Aviation, ARS, Leopard and Mako to the reconciling column titled “All Other”. Additionally, the Company changed the name of its pressure pumping segment to the well completion segment in 2020. The results for the three and nine months ended September 30, 2020 have been retroactively adjusted to reflect this change in reportable segments. The Infrastructure segment provides electric utility infrastructure services to government-funded utilities, private utilities, public investor-owned utilities and co-operative utilities in the northeastern, southwestern, midwestern and western portions of the United States. The Well Completion segment provides hydraulic fracturing and water transfer services primarily in the Utica Shale of Eastern Ohio, Marcellus Shale in Pennsylvania and the mid-continent region. The Sand segment mines, processes and sells sand for use in hydraulic fracturing. The Sand segment primarily services the Utica Shale, Permian Basin, SCOOP, STACK and Montney Shale in British Columbia and Alberta, Canada. During certain of the periods presented, the Drilling segment provided contract land and directional drilling services primarily in the Permian Basin and mid-continent region. During certain of the periods presented, the Company also provided aviation services, coil tubing services, equipment rental services, full service transportation, crude oil hauling services, remote accommodation, equipment manufacturing and infrastructure engineering and design services. The businesses that provide these services are distinct operating segments, which the CODM reviews independently when making key operating and resource utilization decisions. None of these operating segments meet the quantitative thresholds of a reporting segment and do not meet the aggregation criteria set forth in ASC 280 Segment Reporting. Therefore, results for these operating segments are included in the column titled “All Other” in the tables below. Additionally, assets for corporate activities, which primarily include cash and cash equivalents, inter-segment accounts receivable, prepaid insurance and certain property and equipment, are included in the All Other column. Although Mammoth Energy Partners LLC, which holds these corporate assets, meets one of the quantitative thresholds of a reporting segment, it does not engage in business activities from which it may earn revenues and its results are not regularly reviewed by the Company’s CODM when making key operating and resource utilization decisions. Therefore, the Company does not include it as a reportable segment. Sales from one segment to another are generally priced at estimated equivalent commercial selling prices. Total revenue and Total cost of revenue amounts included in the Eliminations column in the following tables include inter-segment transactions conducted between segments. Receivables due for sales from one segment to another and for corporate allocations to each segment are included in the Eliminations column for Total assets in the following tables. All transactions conducted between segments are eliminated in consolidation. Transactions conducted by companies within the same reporting segment are eliminated within each reporting segment. The following tables set forth certain financial information with respect to the Company’s reportable segments (in thousands):
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Subsequent Events |
9 Months Ended |
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Sep. 30, 2021 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events As discussed above, on November 3, 2021, the Company entered into a third amendment to its revolving credit facility. See Note 9 above for details. |
Basis of Presentation and Significant Accounting Policies (Policies) |
9 Months Ended |
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Sep. 30, 2021 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying unaudited condensed consolidated interim financial statements include the accounts of the Company and its subsidiaries and the variable interest entities (“VIE”) for which the Company is the primary beneficiary. All material intercompany accounts and transactions have been eliminated. This report has been prepared in accordance with the rules and regulations of the Securities and Exchange Commission, and reflects all adjustments, which in the opinion of management are necessary for the fair presentation of the results for the interim periods, on a basis consistent with the annual audited consolidated financial statements. All such adjustments are of a normal, recurring nature. Certain information, accounting policies and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles (“GAAP”) have been omitted pursuant to such rules and regulations, although the Company believes that the disclosures are adequate to make the information presented not misleading. These unaudited condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and the summary of significant accounting policies and notes thereto included in the Company’s most recent annual report on Form 10-K.
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Accounts Receivable | Accounts Receivable Accounts receivable include amounts due from customers for services performed or goods sold. The Company grants credit to customers in the ordinary course of business and generally does not require collateral. Prior to granting credit to customers, the Company analyzes the potential customer’s risk profile by utilizing a credit report, analyzing macroeconomic factors and using its knowledge of the industry, among other factors. Most areas in the continental United States in which the Company operates provide for a mechanic’s lien against the property on which the service is performed if the lien is filed within the statutorily specified time frame. Customer balances are generally considered delinquent if unpaid by the 30th day following the invoice date and credit privileges may be revoked if balances remain unpaid. Interest on delinquent accounts receivable is recognized in other income when chargeable and collectability is reasonably assured. During the period October 2017 through March 2019, the Company provided infrastructure services in Puerto Rico under master services agreements entered into by Cobra Acquisitions LLC (“Cobra”), one of the Company’s subsidiaries, with the Puerto Rico Electric Power Authority (“PREPA”) to perform repairs to PREPA’s electrical grid as a result of Hurricane Maria. During the three and nine months ended September 30, 2021 and three and nine months ended September 30, 2020, the Company charged interest on delinquent accounts receivable pursuant to the terms of its agreements with PREPA totaling $9.3 million and $27.0 million, respectively, and $8.2 million and $23.8 million, respectively. These amounts are included in “other income (expense), net” on the unaudited condensed consolidated statement of comprehensive loss. Included in “accounts receivable, net” on the unaudited condensed consolidated balance sheets as of September 30, 2021 and December 31, 2020 were interest charges of $101.2 million and $74.3 million, respectively. The Company regularly reviews receivables and provides for expected losses through an allowance for doubtful accounts. In evaluating the level of established reserves, the Company makes judgments regarding its customers’ ability to make required payments, economic events and other factors. As the financial condition of customers changes, circumstances develop, or additional information becomes available, adjustments to the allowance for doubtful accounts may be required. In the event the Company expects that a customer may not be able to make required payments, the Company would increase the allowance through a charge to income in the period in which that determination is made. If it is determined that previously reserved amounts are collectible, the Company would decrease the allowance through a credit to income in the period in which that determination is made. Uncollectible accounts receivable are periodically charged against the allowance for doubtful accounts once a final determination is made regarding their collectability.
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Concentrations of Credit Risk and Significant Customers | Concentrations of Credit Risk and Significant Customers Financial instruments that potentially subject the Company to concentrations of credit risk consist of cash and cash equivalents in excess of federally insured limits and trade receivables. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company’s financial instruments consist of cash and cash equivalents, trade receivables, trade payables, amounts receivable or payable to related parties and long-term debt. The carrying amount of cash and cash equivalents, trade receivables, receivables from related parties and trade payables approximates fair value because of the short-term nature of the instruments. The fair value of long-term debt approximates its carrying value because the cost of borrowing fluctuates based upon market conditions.
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Revenue | Revenue The Company’s primary revenue streams include infrastructure services, well completion services, natural sand proppant services, drilling services and other services, which includes coil tubing, pressure control, flowback, cementing, acidizing, equipment rentals, full service transportation, crude oil hauling, remote accommodations, equipment manufacturing and infrastructure engineering and design services. See Note 19 for the Company’s revenue disaggregated by type. Certain of the Company’s customer contracts include provisions entitling the Company to a termination penalty when the customer invokes its contractual right to terminate prior to the contract’s nominal end date. The termination penalties in the customer contracts vary, but are generally considered substantive for accounting purposes and create enforceable rights and obligations throughout the stated duration of the contract. The Company accounts for a contract cancellation as a contract modification in the period in which the customer invokes the termination provision. The determination of the contract termination penalty is based on the terms stated in the related customer agreement. As of the modification date, the Company updates its estimate of the transaction price using the expected value method, subject to constraints, and recognizes the amount over the remaining performance period. Infrastructure Services Infrastructure services are typically provided pursuant to master service agreements, repair and maintenance contracts or fixed price and non-fixed price installation contracts. Pricing under these contracts may be unit priced, cost-plus/hourly (or time and materials basis) or fixed price (or lump sum basis). Generally, the Company accounts for infrastructure services as a single performance obligation satisfied over time. In certain circumstances, the Company supplies materials that are utilized during the jobs as part of the agreement with the customer. The Company accounts for these infrastructure agreements as multiple performance obligations satisfied over time. Revenue is recognized over time as work progresses based on the days completed or as the contract is completed. Under certain customer contracts in our infrastructure services segment, the Company warranties equipment and labor performed for a specified period following substantial completion of the work. Well Completion Services Well completion services are typically provided based upon a purchase order, contract or on a spot market basis. Services are provided on a day rate, contracted or hourly basis. Generally, the Company accounts for well completion services as a single performance obligation satisfied over time. In certain circumstances, the Company supplies proppant that is utilized for pressure pumping as part of the agreement with the customer. The Company accounts for these pressure pumping agreements as multiple performance obligations satisfied over time. Jobs for these services are typically short-term in nature and range from a few hours to multiple days. Generally, revenue is recognized over time upon the completion of each segment of work based upon a completed field ticket, which includes the charges for the services performed, mobilization of the equipment to the location, consumable supplies and personnel. Pursuant to a contract with Gulfport, Stingray Pressure Pumping agreed to provide Gulfport with use of up to two pressure pumping fleets for the period covered by the contract. Under this agreement, performance obligations were satisfied as services were rendered based on the passage of time rather than the completion of each segment of work. Stingray Pressure Pumping had the right to receive consideration from this customer even if circumstances prevent us from performing work. All consideration owed to Stingray Pressure Pumping for services performed during the contractual period is fixed and the right to receive it is unconditional. Gulfport has filed a legal action in Delaware state court seeking the termination of this contract and monetary damages. Further, on November 13, 2020, Gulfport filed petitions for voluntary relief under chapter 11 of the Bankruptcy Code. On March 22, 2021, Gulfport listed the Stingray Pressure Pumping contract on its master rejection schedule filed with the bankruptcy court. The Company determined that these factors changed the scope of the contract, accelerated the duration of, and otherwise changed the rights and obligations of each party to the contract. As a result, the Company accounted for this as a contract modification during the three months ended March 31, 2021. Stingray Pressure Pumping used the expected value method to estimate unliquidated damages totaling $37.9 million, which resulted in the recognition of net revenue totaling $14.8 million and bad debt expense of $2.9 million on previously recognized revenue during the three months ended March 31, 2021. On September 21, 2021, the Company and Gulfport reached a settlement under which all litigation relating to the Stingray Pressure Pumping contract will be terminated. Stingray Pressure Pumping will release all claims against Gulfport and its subsidiaries with respect to Gulfport’s bankruptcy proceedings and each of the parties will release all claims they had against the others with respect to the litigation matters discussed in Note 18. The settlement remains subject to the final approval by the bankruptcy court overseeing Gulfport’s bankruptcy. As a result of this settlement agreement, during the three months ended September 30, 2021, the Company wrote off its remaining receivable related to the Stingray Pressure Pumping claim resulting in bad debt expense and other expense of $31.0 million and $1.3 million, respectively. Gulfport was a related party until June 29, 2021. On June 29, 2021, pursuant to the terms of its plan of reorganization, all of the Company’s shares that Gulfport owned were transferred to a trust for the benefit of certain of Gulfport’s creditors. The revenue recognized related to this agreement is included in “services revenue - related parties” in the accompanying unaudited condensed consolidated statement of comprehensive loss and the related accounts receivable is included in “receivables due from related parties” as of December 31, 2020. See Notes 11 and 18 below. Additional revenue is generated through labor charges and the sale of consumable supplies that are incidental to the service being performed. Such amounts are recognized ratably over the period during which the corresponding goods and services are consumed. Natural Sand Proppant Services The Company sells natural sand proppant through sand supply agreements with its customers. Under these agreements, sand is typically sold at a flat rate per ton or a flat rate per ton with an index-based adjustment. The Company recognizes revenue at the point in time when the customer obtains legal title to the product, which may occur at the production facility, rail origin or at the destination terminal. Certain of the Company’s sand supply agreements contain a minimum volume commitment related to sand purchases whereby the Company charges a shortfall payment if the customer fails to meet the required minimum volume commitment. These agreements may also contain make-up provisions whereby shortfall payments can be applied in future periods against purchased volumes exceeding the minimum volume commitment. If a make-up right exists, the Company has future performance obligations to deliver excess volumes of product in subsequent months. In accordance with ASC 606, if the customer fails to meet the minimum volume commitment, the Company will assess whether it expects the customer to fulfill its unmet commitment during the contractually specified make-up period based on discussions with the customer and management’s knowledge of the business. If the Company expects the customer will make-up deficient volumes in future periods, revenue related to shortfall payments will be deferred and recognized on the earlier of the date on which the customer utilizes make-up volumes or the likelihood that the customer will exercise its right to make-up deficient volumes becomes remote. As of September 30, 2021, the Company had deferred revenue totaling $7.3 million related to shortfall payments. This amount is included in “accrued expenses and other current liabilities” on the unaudited condensed consolidated balance sheet. If the Company does not expect the customer will make-up deficient volumes in future periods, the breakage model will be applied and revenue related to shortfall payments will be recognized when the model indicates the customer’s inability to take delivery of excess volumes. The Company recognized revenue totaling $6.0 million during the nine months ended September 30, 2021, respectively, and $4.9 million and $14.7 million during the three and nine months ended September 30, 2020, respectively, related to shortfall payments. The Company did not recognize any shortfall revenue during the three months ended September 30, 2021. In certain of the Company’s sand supply agreements, the customer obtains control of the product when it is loaded into rail cars and the customer reimburses the Company for all freight charges incurred. The Company has elected to account for shipping and handling as activities to fulfill the promise to transfer the sand. If revenue is recognized for the related product before the shipping and handling activities occur, the Company accrues the related costs of those shipping and handling activities. Pursuant to its contract with Gulfport, Muskie agreed to sell and deliver specified amounts of sand to Gulfport. In September 2020, Muskie filed a lawsuit against Gulfport to recover delinquent payments due under this agreement. On November 13, 2020, Gulfport filed petitions for voluntary relief under chapter 11 of the Bankruptcy Code. On March 22, 2021, Gulfport listed the Muskie contract on its master rejection schedule filed with the bankruptcy court. The Company determined that these factors changed the scope of the contract, accelerated the duration of, and otherwise changed the rights and obligations of each party to the contract. As a result, the Company accounted for this as a contract modification during the three months ended March 31, 2021. Muskie used the expected value method to estimate unliquidated damages totaling $8.5 million, which resulted in the recognition of net revenue totaling $2.1 million and bad debt expense of $1.0 million on previously recognized revenue during the three months ended March 31, 2021. On September 21, 2021, the Company and Gulfport reached a settlement under which all litigation relating to the Muskie contract will be terminated, each of the parties will release all claims they had against the others with respect to the litigation matters discussed in Note 18 and Muskie’s contract claim against Gulfport will be allowed under Gulfport’s plan of reorganization in the amount of $3.1 million. The settlement remains subject to the final approval by the bankruptcy court overseeing Gulfport’s bankruptcy. As a result of this settlement agreement, Muskie recognized bad debt expense of $0.2 million during the three months ended September 30, 2021. As of September 30, 2021, Muskie had net accounts receivable due from Gulfport totaling $0.1 million, which includes a nominal amount of interest on delinquent accounts receivable. Gulfport was a related party until June 29, 2021. The revenue recognized related to this agreement is included in “product revenue - related parties” in the accompanying unaudited condensed consolidated statement of comprehensive loss and the related accounts receivable is included in “accounts receivable, net” in the unaudited condensed consolidated balance sheets as of September 30, 2021 and “receivables due from related parties” as of December 31, 2020. See Notes 11 and 18 below. Drilling Services Contract drilling services were provided under daywork contracts. Directional drilling services, including motor rentals, are provided on a day rate or hourly basis, and revenue is recognized as work progresses. Performance obligations are satisfied over time as the work progresses based on the measure of output. Mobilization revenue and costs were recognized over the days of actual drilling. As a result of market conditions, the Company temporarily shut down its contract land drilling operations beginning in December 2019 and rig hauling operations beginning in April 2020. Other Services During the periods presented, the Company also provided aviation, coil tubing, pressure control, equipment rentals, full service transportation, crude oil hauling, remote accommodations, equipment manufacturing and infrastructure engineering and design services, which are reported under other services. As a result of market conditions, the Company has temporarily shut down its coil tubing and full service transportation operations beginning in July 2020 and its crude oil hauling operations beginning in July 2021. The Company’s other services are typically provided based upon a purchase order, contract or on a spot market basis. Services are provided on a day rate, contracted or hourly basis. Performance obligations for these services are satisfied over time and revenue is recognized as the work progresses based on the measure of output. Jobs for these services are typically short-term in nature and range from a few hours to multiple days. Practical Expedients The Company does not disclose the value of unsatisfied performance obligations for (i) contracts with an original expected length of one year or less and (ii) contracts in which variable consideration is allocated entirely to a wholly unsatisfied performance obligation or to a wholly unsatisfied distinct good or service that forms part of a single performance obligation.
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Inventories | InventoriesInventories consist of raw sand and processed sand available for sale, chemicals and other products sold as a bi-product of completion and production operations and supplies used in performing services. Inventory is stated at the lower of cost or net realizable value on an average cost basis. |
Basis of Presentation and Significant Accounting Policies (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accounting Policies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Allowance for Doubtful Accounts Receivable | Following is a roll forward of the allowance for doubtful accounts for the year ended December 31, 2020 and the nine months ended September 30, 2021 (in thousands):
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Schedules of Concentration of Risk | Following is a summary of our significant customers based on percentages of total accounts receivable balances at September 30, 2021 and December 31, 2020 and percentages of total revenues derived for the three and nine months ended September 30, 2021 and 2020:
a.Customer A is a third-party customer. The accounts receivable balances from Customer A were derived from the Company’s infrastructure services segment. Accounts receivable for Customer A also includes receivables due for interest charged on delinquent accounts receivable. b.Customer B was a related-party customer until June 29, 2021. Revenues earned from this customer prior to June 29, 2021 are included in services revenue - related parties and product revenue - related parties on the unaudited condensed consolidated statements of comprehensive loss. The related accounts receivable are included in accounts receivable, net on the unaudited condensed consolidated balance sheet at September 30, 2021 and receivables due from related parties, net at December 31, 2020. Revenues and the related accounts receivable balances earned from Customer B were derived from the Company’s well completion services segment, natural sand proppant services segment and other businesses. Accounts receivable for Customer B also includes receivables due for interest charged on delinquent accounts receivable. c.Customer C is a third-party customer. Revenues and the related accounts receivable balances earned from Customer C were derived from the Company’s well completion services segment. d.Customer D is a third-party customer. Revenues and the related accounts receivable balances earned from Customer D were derived from the Company’s infrastructure services segment.
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Revenue (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenue from Contract with Customer [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Contract Liabilities | Following is a rollforward of the Company’s contract liabilities (in thousands):
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Inventories (Tables) |
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Sep. 30, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Inventory Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Inventory | A summary of the Company’s inventories is shown below (in thousands):
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Property, Plant and Equipment (Tables) |
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Property, Plant and Equipment [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Property, Plant and Equipment | Property, plant and equipment include the following (in thousands):
a. Included in Buildings at each of September 30, 2021 and December 31, 2020 are costs of $7.6 million related to assets under operating leases. b. Included in Other property and equipment at each of September 30, 2021 and December 31, 2020 are costs of $6.0 million related to assets under operating leases. c. Deposits on equipment and equipment in process of assembly represents deposits placed with vendors for equipment that is in the process of assembly and purchased equipment that is being outfitted for its intended use. The equipment is not yet placed in service. d. Includes accumulated depreciation of $6.3 million and $5.0 million at September 30, 2021 and December 31, 2020, respectively, related to assets under operating leases.
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Schedule of Asset Impairment | As a result of the test, the Company recorded the following impairments to its fixed assets during the first quarter of 2020 (in thousands):
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Schedule of Depreciation, Depletion, Accretion and Amortization expense | A summary of depreciation, depletion, amortization and accretion expense is below (in thousands):
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Goodwill and Intangible Assets (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Goodwill | Changes in the net carrying amount of goodwill by reporting segment (see Note 19) for the nine months ended September 30, 2021 and year ended December 31, 2020 are presented below (in thousands):
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Schedule of Finite-Lived Intangible Assets | The Company had the following definite lived intangible assets recorded (in thousands):
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Schedule of Finite-Lived Intangible Assets, Future Amortization Expense | Aggregated expected amortization expense for the future periods is expected to be as follows (in thousands):
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Accrued Expenses and Other Current Liabilities and Other Long-Term Liabilities (Tables) |
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Payables and Accruals [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Accrued Expenses and Other Current Liabilities and Other Long-Term Liabilities | Accrued expenses and other current liabilities and other long-term liabilities included the following (in thousands):
a.In June 2021, the Company reached an agreement to settle a certain legal matter. See Note 18 for additional detail. b.On December 30, 2020, the Company entered into an agreement with First National Capital, LLC (“FNC”) whereby the Company agreed to sell certain assets from its infrastructure segment to FNC for aggregate proceeds of $5.0 million. Concurrent with the sale of assets, the Company entered into a 36 month lease agreement whereby the Company agreed to lease back the assets at a monthly rental rate of $0.1 million. On June 1, 2021, the Company entered into another agreement with FNC whereby the Company sold additional assets from its infrastructure segment to FNC for aggregate proceeds of $9.5 million and entered into a 42 month lease agreement whereby the Company agreed to lease back the assets at a monthly rental rate of $0.2 million. Under the agreements, the Company has the option to purchase the assets at the end of the lease terms. The Company recorded liabilities for the proceeds received and will continue to depreciate the assets. The Company has imputed an interest rate so that the carrying amount of the financial liabilities will be the expected repurchase price at the end of the initial lease terms. c.Financed insurance premiums are due in monthly installments, are unsecured and mature within the twelve-month period following the close of the year. As of September 30, 2021 and December 31, 2020, the applicable interest rate associated with financed insurance premiums ranged from 3.45% to 3.75%.
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Debt (Tables) |
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Sep. 30, 2021 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Debt | Long-term debt included the following (in thousands):
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Selling, General and Administrative Expense (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other Income and Expenses [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Selling, General and Administrative Expense | Selling, general and administrative (“SG&A”) expense includes of the following (in thousands):
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Leases (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Leases [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Lease Expense and Other Supplemental Information | Lease expense consisted of the following for the three and nine months ended September 30, 2021 and 2020 (in thousands):
Other supplemental information related to leases for the three and nine months ended September 30, 2021 and 2020 and as of September 30, 2021 and December 31, 2020 is as follows (in thousands):
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Schedule of Lease Assets and Liabilities | Supplemental balance sheet information related to leases as of September 30, 2021 and December 31, 2020 is as follows (in thousands):
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Schedule of Maturities for Finance Leases Liabilities | Maturities of lease liabilities as of September 30, 2021 are as follows (in thousands):
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Schedule of Maturities for Operating Leases Liabilities | Maturities of lease liabilities as of September 30, 2021 are as follows (in thousands):
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(Loss) Earnings Per Share (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Reconciliations of the Components of Basic and Diluted Net Loss per Common Share | Reconciliations of the components of basic and diluted net (loss) income per common share are presented in the table below (in thousands, except per share data):
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Stock Based Compensation (Tables) |
9 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2021 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Share-based Payment Arrangement [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Share-Based Compensation, Restricted Stock and Restricted Stock Units Activity | A summary of the status and changes of the unvested shares of restricted stock under the 2016 Plan is presented below.
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Related Party Transactions (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Related Party Transactions [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Related Party Transactions | Following is a summary of related party transactions (in thousands):
a.Pressure Pumping provided pressure pumping, stimulation and related completion services to Gulfport. On June 29, 2021, Gulfport ceased to be a related party. See Note 3. b.Muskie agreed to sell and deliver, and Gulfport agreed to purchase, specified annual and monthly amounts of natural sand proppant, subject to certain exceptions specified in the agreement, and pay certain costs and expenses. On June 29, 2021, Gulfport ceased to be a related party. See Note 3. c.SR Energy provided rental services to Gulfport. On June 29, 2021, Gulfport ceased to be a related party. d.Panther provides directional drilling services for El Toro, an entity controlled by Wexford, pursuant to a master service agreement. e.Cobra Aviation, ARS and Leopard lease helicopters to Brim Equipment pursuant to aircraft lease and management agreements.
a.Cobra Aviation, ARS and Leopard lease helicopters to Brim Equipment pursuant to aircraft lease and management agreements. b.Caliber leases office space to Anaconda and Mammoth.
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Commitments and Contingencies (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Commitments and Contingencies Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Letters of Credit | The letters of credit are categorized below (in thousands):
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Reporting Segments (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Segment Reporting Information, by Segment | The following tables set forth certain financial information with respect to the Company’s reportable segments (in thousands):
|
Basis of Presentation and Significant Accounting Policies - Accounts Receivable (Details) - USD ($) $ in Thousands |
9 Months Ended | 12 Months Ended |
---|---|---|
Sep. 30, 2021 |
Dec. 31, 2020 |
|
Accounts Receivable, Allowance for Credit Loss [Roll Forward] | ||
Balance at beginning of period | $ 30,139 | $ 5,154 |
Additions charged to bad debt expense | 41,799 | 22,705 |
Additions charged to revenue | 27,071 | |
Additions charged to other selling, general and administrative expense | 273 | 3,950 |
Additions charged to other (expense) income, net - related parties | 515 | 1,427 |
Additions charged to other income (expense), net | 1,394 | |
Recoveries of receivables previously charged to bad debt expense | (149) | (747) |
Deductions for uncollectible receivables written off | (82,426) | (2,350) |
Balance at end of period | $ 18,616 | $ 30,139 |
Revenue - Schedule of Contract Liabilities (Details) - USD ($) $ in Thousands |
9 Months Ended | 12 Months Ended |
---|---|---|
Sep. 30, 2021 |
Dec. 31, 2020 |
|
Contract with Customer, Liability [Roll Forward] | ||
Balance, beginning of period | $ 8,281 | $ 7,244 |
Deduction for recognition of revenue | (5,308) | (25,047) |
Increase for deferral of shortfall payments | 4,338 | 25,436 |
Increase for deferral of customer prepayments | 187 | 648 |
Balance, end of period | $ 7,498 | $ 8,281 |
Revenue - Performance Obligations and Contract Balances (Details) - USD ($) |
9 Months Ended | ||
---|---|---|---|
Sep. 30, 2021 |
Dec. 31, 2020 |
Dec. 31, 2019 |
|
Revenue from Contract with Customer [Abstract] | |||
Contract assets | $ 0 | $ 0 | $ 0 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |||
Remaining performance obligation | $ 3,800,000 | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-10-01 | |||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |||
Revenue recognition period | six months |
Inventories (Details) - USD ($) $ in Thousands |
Sep. 30, 2021 |
Dec. 31, 2020 |
---|---|---|
Inventory Disclosure [Abstract] | ||
Supplies | $ 5,165 | $ 6,312 |
Raw materials | 731 | 613 |
Work in process | 2,900 | 3,478 |
Finished goods | 642 | 1,617 |
Total inventories | $ 9,438 | $ 12,020 |
Property, Plant, and Equipment - Schedule of Asset Impairment (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | |
---|---|---|---|
Mar. 31, 2020 |
Sep. 30, 2021 |
Sep. 30, 2020 |
|
Property, Plant and Equipment [Line Items] | |||
Impairment of other long-lived assets | $ 12,897 | $ 547 | $ 12,897 |
Water transfer equipment | |||
Property, Plant and Equipment [Line Items] | |||
Impairment of other long-lived assets | 4,203 | ||
Crude oil hauling equipment | |||
Property, Plant and Equipment [Line Items] | |||
Impairment of other long-lived assets | 3,275 | ||
Coil tubing equipment | |||
Property, Plant and Equipment [Line Items] | |||
Impairment of other long-lived assets | 2,160 | ||
Flowback equipment | |||
Property, Plant and Equipment [Line Items] | |||
Impairment of other long-lived assets | 1,514 | ||
Rental equipment | |||
Property, Plant and Equipment [Line Items] | |||
Impairment of other long-lived assets | 1,308 | ||
Other equipment | |||
Property, Plant and Equipment [Line Items] | |||
Impairment of other long-lived assets | $ 437 |
Property, Plant, and Equipment - Narratives (Details) - USD ($) |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2021 |
Sep. 30, 2020 |
Sep. 30, 2021 |
Sep. 30, 2020 |
|
Property, Plant and Equipment [Line Items] | ||||
Proceeds from disposal of property and equipment | $ 9,581,000 | $ 4,859,000 | ||
Gain (loss) on disposal of property and equipment | 4,632,000 | 927,000 | ||
Comprehensive Income | ||||
Property, Plant and Equipment [Line Items] | ||||
Proceeds from disposal of property and equipment | $ 4,900,000 | $ 2,700,000 | 9,500,000 | 4,900,000 |
Gain (loss) on disposal of property and equipment | 3,000,000 | (600,000) | 4,600,000 | 200,000 |
Other property and equipment | ||||
Property, Plant and Equipment [Line Items] | ||||
Impairment charges | 0 | 0 | ||
Drilling rigs and related equipment | ||||
Property, Plant and Equipment [Line Items] | ||||
Proceeds from disposal of property and equipment | $ 0 | $ 0 | $ 0 | |
Gain (loss) on disposal of property and equipment | $ 700,000 |
Property, Plant and Equipment - Schedule of Depreciation, Amortization, Accretion, and Depletion (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2021 |
Sep. 30, 2020 |
Sep. 30, 2021 |
Sep. 30, 2020 |
|
Property, Plant and Equipment [Abstract] | ||||
Depreciation expense | $ 18,179 | $ 22,305 | $ 58,625 | $ 71,645 |
Depletion expense | 684 | 545 | 1,069 | 638 |
Amortization expense | 249 | 253 | 756 | 761 |
Accretion expense | 36 | 29 | 109 | 86 |
Depreciation, depletion, amortization and accretion | $ 19,148 | $ 23,132 | $ 60,559 | $ 73,130 |
Goodwill and Intangible Assets - Schedule Of Changes in Goodwill (Details) - USD ($) |
3 Months Ended | 9 Months Ended | 12 Months Ended | ||||
---|---|---|---|---|---|---|---|
Sep. 30, 2021 |
Sep. 30, 2020 |
Mar. 31, 2020 |
Sep. 30, 2021 |
Sep. 30, 2020 |
Dec. 31, 2020 |
Dec. 31, 2019 |
|
Goodwill [Roll Forward] | |||||||
Goodwill, gross period start | $ 104,448,000 | $ 104,448,000 | $ 104,448,000 | $ 104,448,000 | |||
Accumulated impairment losses | $ (91,840,000) | (91,840,000) | (91,840,000) | $ (36,867,000) | |||
Goodwill, total | 12,608,000 | 12,608,000 | 12,608,000 | 67,581,000 | |||
Acquisitions | 0 | 0 | |||||
Impairment losses | 0 | $ 0 | (55,000,000) | 0 | (54,973,000) | (54,973,000) | |
Goodwill, gross period end | 104,448,000 | 104,448,000 | 104,448,000 | ||||
Infrastructure | |||||||
Goodwill [Roll Forward] | |||||||
Goodwill, gross period start | 891,000 | 891,000 | 891,000 | 891,000 | |||
Accumulated impairment losses | 0 | 0 | 0 | 0 | |||
Goodwill, total | 891,000 | 891,000 | 891,000 | 891,000 | |||
Acquisitions | 0 | 0 | |||||
Impairment losses | 0 | 0 | |||||
Goodwill, gross period end | 891,000 | 891,000 | 891,000 | ||||
Well Completion | |||||||
Goodwill [Roll Forward] | |||||||
Goodwill, gross period start | 86,043,000 | 86,043,000 | 86,043,000 | 86,043,000 | |||
Accumulated impairment losses | (76,829,000) | (76,829,000) | (76,829,000) | (23,423,000) | |||
Goodwill, total | 9,214,000 | 9,214,000 | 9,214,000 | 62,620,000 | |||
Acquisitions | 0 | 0 | |||||
Impairment losses | 0 | (53,406,000) | |||||
Goodwill, gross period end | 86,043,000 | 86,043,000 | 86,043,000 | ||||
Sand | |||||||
Goodwill [Roll Forward] | |||||||
Goodwill, gross period start | 2,684,000 | 2,684,000 | 2,684,000 | 2,684,000 | |||
Accumulated impairment losses | (2,684,000) | (2,684,000) | (2,684,000) | (2,684,000) | |||
Goodwill, total | 0 | 0 | 0 | 0 | |||
Acquisitions | 0 | 0 | |||||
Impairment losses | 0 | 0 | |||||
Goodwill, gross period end | 2,684,000 | 2,684,000 | 2,684,000 | ||||
Other | |||||||
Goodwill [Roll Forward] | |||||||
Goodwill, gross period start | $ 14,830,000 | 14,830,000 | $ 14,830,000 | 14,830,000 | |||
Accumulated impairment losses | (12,327,000) | (12,327,000) | (12,327,000) | (10,760,000) | |||
Goodwill, total | 2,503,000 | 2,503,000 | 2,503,000 | $ 4,070,000 | |||
Acquisitions | 0 | 0 | |||||
Impairment losses | 0 | (1,567,000) | |||||
Goodwill, gross period end | $ 14,830,000 | $ 14,830,000 | $ 14,830,000 |
Goodwill and Intangible Assets - Definite Lived Intangible Assets (Details) - USD ($) $ in Thousands |
Sep. 30, 2021 |
Dec. 31, 2020 |
---|---|---|
Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets, net | $ 3,471 | $ 4,774 |
Customer relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible assets, gross | 1,050 | 1,050 |
Less: accumulated amortization | (773) | (642) |
Intangible assets, net | 277 | 408 |
Trade names | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible assets, gross | 8,413 | 9,063 |
Less: accumulated amortization | (5,219) | (4,697) |
Intangible assets, net | $ 3,194 | $ 4,366 |
Goodwill and Intangible Assets - Aggregated Expected Amortization Expense (Details) - USD ($) $ in Thousands |
Sep. 30, 2021 |
Dec. 31, 2020 |
---|---|---|
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Remainder of 2021 | $ 245 | |
2022 | 982 | |
2023 | 865 | |
2024 | 739 | |
2025 | 119 | |
Thereafter | 521 | |
Intangible assets, net | $ 3,471 | $ 4,774 |
Accrued Expenses and Other Current Liabilities and Other Long-Term Liabilities (Details) - USD ($) $ in Thousands |
Sep. 30, 2021 |
Dec. 31, 2020 |
---|---|---|
Accrued Expenses and Other Current Liabilities | ||
Accrued legal settlement | $ 18,500 | $ 0 |
State and local taxes payable | 14,169 | 13,838 |
Deferred revenue | 7,498 | 8,281 |
Sale leaseback liability | 3,267 | 1,290 |
Accrued compensation and benefits | 3,222 | 3,710 |
Payroll tax liability | 1,897 | 1,816 |
Financing leases | 1,817 | 1,499 |
Insurance reserves | 1,637 | 1,941 |
Financed insurance premiums | 94 | 10,394 |
Other | 2,623 | 1,639 |
Total accrued expenses and other current liabilities | 54,724 | 44,408 |
Other Long-Term Liabilities | ||
Sale leaseback liability | 8,203 | 3,348 |
Financing leases | 4,840 | 4,618 |
Payroll tax liability | 1,897 | 1,977 |
Other | 63 | 492 |
Total other long-term liabilities | $ 15,003 | $ 10,435 |
Accrued Expenses and Other Current Liabilities and Other Long-Term Liabilities - Footnote (Details) - USD ($) $ in Millions |
Jun. 01, 2021 |
Dec. 30, 2020 |
Sep. 30, 2021 |
Dec. 31, 2020 |
---|---|---|---|---|
Schedule of Other Operating Cost and Expense, by Component [Line Items] | ||||
Term of contract | 42 months | 36 months | ||
First National Capital, LLC | ||||
Schedule of Other Operating Cost and Expense, by Component [Line Items] | ||||
Proceeds from sale of assets | $ 9.5 | $ 5.0 | ||
Monthly rental payment amount | $ 0.2 | $ 0.1 | ||
Minimum | ||||
Schedule of Other Operating Cost and Expense, by Component [Line Items] | ||||
Financed insurance premium interest rate | 3.45% | 3.45% | ||
Maximum | ||||
Schedule of Other Operating Cost and Expense, by Component [Line Items] | ||||
Financed insurance premium interest rate | 3.75% | 3.75% |
Debt - Schedule of Debt (Details) - USD ($) $ in Thousands |
Sep. 30, 2021 |
Dec. 31, 2020 |
---|---|---|
Debt Disclosure [Abstract] | ||
Revolving credit facility | $ 76,951 | $ 78,000 |
Aviation note | 3,730 | 4,551 |
Unamortized debt issuance costs | (37) | (48) |
Total debt | 80,644 | 82,503 |
Less: current portion | 1,449 | 1,165 |
Total long-term debt | $ 79,195 | $ 81,338 |
Variable Interest Entities - Narrative (Details) |
9 Months Ended |
---|---|
Sep. 30, 2021
helicopter
| |
Leopard Aviation LLC | |
Variable Interest Entity [Line Items] | |
Number of helicopters owned | 1 |
Dire Wolf Energy Services LLC | Cobra Aviation Services LLC | |
Variable Interest Entity [Line Items] | |
Interest transferred | 100.00% |
Predator Aviation LLC | Leopard Aviation LLC | |
Variable Interest Entity [Line Items] | |
Interest transferred | 100.00% |
Cobra Aviation Services LLC | |
Variable Interest Entity [Line Items] | |
Number of helicopters | 2 |
ARS | |
Variable Interest Entity [Line Items] | |
Percentage of ownership | 100.00% |
Brim Acquisitions LLC | |
Variable Interest Entity [Line Items] | |
Percentage of ownership | 49.00% |
Selling, General and Administrative Expense - Schedule of Selling, General and Administrative Expense (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | |||
---|---|---|---|---|---|
Sep. 30, 2021 |
Mar. 31, 2021 |
Sep. 30, 2020 |
Sep. 30, 2021 |
Sep. 30, 2020 |
|
Non-cash expenses: | |||||
Bad debt expense | $ 41,650 | $ 2,306 | |||
Stock based compensation | 950 | 1,598 | |||
Total SG&A expense | $ 41,866 | $ 12,180 | 74,697 | 36,677 | |
Gulfport | |||||
Non-cash expenses: | |||||
Bad debt expense | $ 3,800 | ||||
Selling, General and Administrative Expenses | |||||
Cash expenses: | |||||
Compensation and benefits | 3,353 | 3,449 | 11,379 | 11,138 | |
Professional services | 4,571 | 5,651 | 13,783 | 15,335 | |
Other | 2,252 | 2,163 | 7,058 | 6,572 | |
Total cash SG&A expense | 10,176 | 11,263 | 32,220 | 33,045 | |
Non-cash expenses: | |||||
Bad debt expense | 31,449 | 626 | 41,650 | 2,306 | |
Stock based compensation | 241 | 291 | 827 | 1,326 | |
Total non-cash SG&A expense | 31,690 | 917 | 42,477 | 3,632 | |
Total SG&A expense | 41,866 | $ 12,180 | 74,697 | $ 36,677 | |
Selling, General and Administrative Expenses | Gulfport | |||||
Non-cash expenses: | |||||
Bad debt expense | $ 31,200 | $ 41,200 |
Income Taxes - Narrative (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2021 |
Sep. 30, 2020 |
Sep. 30, 2021 |
Sep. 30, 2020 |
|
Income Tax Disclosure [Abstract] | ||||
Benefit for income taxes | $ 7,187 | $ 6,193 | $ 26,370 | $ 8,979 |
Federal income tax rate | 23.00% | 9.00% | ||
Unrecognized tax benefit | $ 900 | |||
Expense related to CARES Act | $ 2,400 | |||
Deferred tax expense | 4,600 | |||
Current income tax benefit | $ (7,000) |
Leases - Schedule of Lease Expense (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2021 |
Sep. 30, 2020 |
Sep. 30, 2021 |
Sep. 30, 2020 |
|
Leases [Abstract] | ||||
Operating lease expense | $ 2,210 | $ 3,338 | $ 7,082 | $ 12,503 |
Short-term lease expense | 113 | 36 | 477 | 323 |
Amortization of right-of-use assets | 412 | 318 | 1,179 | 952 |
Interest on lease liabilities | 51 | 48 | 149 | 153 |
Total lease expense | $ 2,786 | $ 3,740 | $ 8,887 | $ 13,931 |
Leases - Other Supplemental Information Related to Leases (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | |||
---|---|---|---|---|---|
Sep. 30, 2021 |
Sep. 30, 2020 |
Sep. 30, 2021 |
Sep. 30, 2020 |
Dec. 31, 2020 |
|
Cash paid for amounts included in the measurement of lease liabilities: | |||||
Operating cash flows from operating leases | $ 2,159 | $ 3,277 | $ 7,079 | $ 12,207 | |
Operating cash flows from finance leases | 51 | 48 | 149 | 153 | |
Financing cash flows from finance leases | 426 | 344 | 1,229 | 940 | |
Right-of-use assets obtained in exchange for lease obligations: | |||||
Operating leases | 697 | (4,157) | 879 | (6,167) | |
Finance leases | $ 1,822 | $ 237 | $ 1,822 | $ 210 | |
Weighted-average remaining lease term: | |||||
Operating leases | 3 years | 3 years | 3 years 2 months 12 days | ||
Finance leases | 3 years 6 months | 3 years 6 months | 4 years 2 months 12 days | ||
Weighted-average discount rate: | |||||
Operating leases | 3.50% | 3.50% | 3.50% | ||
Finance leases | 3.40% | 3.40% | 3.50% |
Leases - Schedule of Lease Liability Maturity (Details) $ in Thousands |
Sep. 30, 2021
USD ($)
|
---|---|
Operating Leases | |
Remainder of 2021 | $ 2,235 |
2022 | 6,562 |
2023 | 3,927 |
2024 | 1,977 |
2025 | 305 |
Thereafter | 419 |
Total lease payments | 15,425 |
Less: Present value discount | 838 |
Present value of lease payments | 14,587 |
Finance Leases | |
Remainder of 2021 | 501 |
2022 | 2,005 |
2023 | 2,261 |
2024 | 965 |
2025 | 524 |
Thereafter | 795 |
Total lease payments | 7,051 |
Less: Present value discount | 394 |
Present value of lease payments | $ 6,657 |
Leases - Narrative (Details) - USD ($) $ in Millions |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2021 |
Sep. 30, 2020 |
Sep. 30, 2021 |
Sep. 30, 2020 |
|
Leases [Abstract] | ||||
Lease revenue | $ 0.6 | $ 0.4 | $ 1.7 | $ 0.9 |
(Loss) Earnings Per Share - Schedule of Earnings Per Unit (Details) - USD ($) $ / shares in Units, shares in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2021 |
Sep. 30, 2020 |
Sep. 30, 2021 |
Sep. 30, 2020 |
|
Allocation of (loss) earnings: | ||||
Net (loss) income | $ (40,901,000) | $ 3,430,000 | $ (88,131,000) | $ (95,746,000) |
Weighted average common shares outstanding (in shares) | 46,683 | 45,764 | 46,342 | 45,603 |
Basic loss per share (in USD per share) | $ (0.88) | $ 0.07 | $ (1.90) | $ (2.10) |
Diluted (loss) earnings per share: | ||||
Weighted average common shares, including dilutive effect (in shares) | 46,683 | 46,571 | 46,342 | 45,603 |
Diluted loss per share (in USD per share) | $ (0.88) | $ 0.07 | $ (1.90) | $ (2.10) |
Incremental shares of potentially diluted restricted stock awards (in shares) | $ 0 | $ 0 | $ 0 |
Equity Based Compensation - Narrative (Details) - USD ($) $ in Millions |
Sep. 30, 2021 |
Jan. 01, 2019 |
---|---|---|
Specified Member Awards | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Fair value of the award as of the modification dates or grant date | $ 5.6 | |
Non-Employees | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Fair value of the award as of the modification dates or grant date | $ 18.9 |
Stock Based Compensation - Narrative (Details) - USD ($) $ in Millions |
9 Months Ended | |
---|---|---|
Sep. 30, 2021 |
Sep. 30, 2020 |
|
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of shares authorized (in shares) | 4,500,000 | |
Restricted Stock | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Fair value of the award as of the modification dates or grant date | $ 1.0 | |
Unrecognized compensation cost | 1 year 2 months 12 days | |
Compensation expense | $ 0.9 | $ 1.6 |
Stock Based Compensation - Schedule Of Share-Based Compensation (Details) - Restricted Stock - $ / shares |
9 Months Ended | 12 Months Ended |
---|---|---|
Sep. 30, 2021 |
Dec. 31, 2020 |
|
Number of Unvested Restricted Shares | ||
Unvested shares beginning balance (in shares) | 1,914,782 | 221,241 |
Granted (in shares) | 128,205 | 2,401,446 |
Vested (in shares) | (914,782) | (660,738) |
Forfeited (in shares) | 0 | (47,167) |
Unvested shares ending balance (in shares) | 1,128,205 | 1,914,782 |
Weighted Average Grant-Date Fair Value | ||
Unvested shares at beginning of period (in USD per share) | $ 1.21 | $ 22.43 |
Granted (in USD per share) | 3.90 | 0.98 |
Vested (in USD per share) | 1.52 | 5.32 |
Forfeited (in USD per share) | 0 | 3.28 |
Unvested shares at end of period (in USD per share) | $ 1.27 | $ 1.21 |
Related Party Transactions - Narrative (Details) $ in Millions |
9 Months Ended | |
---|---|---|
Dec. 21, 2018
USD ($)
helicopter
|
Sep. 30, 2021 |
|
Cobra Aviation Services LLC | ||
Related Party Transaction [Line Items] | ||
Number of assets purchased | helicopter | 2 | |
Brim Acquisitions LLC | ||
Related Party Transaction [Line Items] | ||
Initial capital of acquisition | $ | $ 2.0 | |
Brim Acquisitions LLC | Cobra Aviation Services LLC | ||
Related Party Transaction [Line Items] | ||
Equity method investment, ownership percentage | 49.00% | |
Brim Acquisitions LLC | Wexford | ||
Related Party Transaction [Line Items] | ||
Equity method investment, ownership percentage | 51.00% | |
Wexford | ||
Related Party Transaction [Line Items] | ||
Percentage of ownership | 48.00% |
Commitments and Contingencies - Schedule of Letters of Credit (Details) - Letter of Credit - USD ($) $ in Thousands |
Sep. 30, 2021 |
Dec. 31, 2020 |
---|---|---|
Line of Credit Facility [Line Items] | ||
Total letters of credit | $ 9,039 | $ 13,039 |
Bonding program | ||
Line of Credit Facility [Line Items] | ||
Total letters of credit | 1,000 | 5,000 |
Environmental remediation | ||
Line of Credit Facility [Line Items] | ||
Total letters of credit | 3,694 | 3,694 |
Insurance programs | ||
Line of Credit Facility [Line Items] | ||
Total letters of credit | 3,890 | 3,890 |
Rail car commitments | ||
Line of Credit Facility [Line Items] | ||
Total letters of credit | $ 455 | $ 455 |
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