BUSINESS SEGMENT INFORMATION

12 Months Ended

Dec. 31, 2019

Following the Business Combination, we have two reportable segments: (i) Upstream and (ii) Midstream. Each segment is ultimately led by our Chief Executive Officer, who is also the Chief Operating Decision Maker (“CODM”). The CODM evaluates segment performance using Adjusted EBITDAX and Adjusted EBITDA.

We believe Adjusted EBITDAX and Adjusted EBITDA are useful because it allows users to more effectively evaluate our operating performance, compare the results of our operations from period to period and against our peers without regard to our financing methods or capital structure and because it highlights trends in our business that may not otherwise be apparent when relying solely on GAAP measures. Adjusted EBITDAX and Adjusted EBITDA should not be considered as an alternative to net income (loss), operating income (loss) or any other performance measure derived in accordance with GAAP and may not be comparable to similarly titled measures in other companies’ reports.



	Year Ended December 31, 2019
(in thousands)	Exploration & Production			Midstream			Corporate and Eliminations				Total
Revenue
Oil	$	328,386		$	—		$	—			$	328,386
Natural gas	53,693			—			—				53,693
Natural gas liquids	40,026			—			—				40,026
Sales of gathered production	—			37,195			—				37,195
Midstream revenue	—			84,763			(54,173		)		30,590
Segment sales revenue	422,105			121,958			(54,173		)		489,890
Other revenue	1,471			24,988			(16,129		)		10,330
Operating revenue	423,576			146,946			(70,302		)		500,220
Gain (loss) on sale of assets	1,488			(106		)	—				1,382
Gain (loss) on derivatives	(11,744		)	—			—				(11,744		)
Total revenue	413,320			146,840			(70,302		)		489,858
Operating expenses
Lease operating	79,884			—			(16,129		)		63,755
Transportation, processing and marketing	70,324			9,659			(58,941		)		21,042
Midstream operating	—			24,719			—				24,719
Cost of sales for purchased gathered production	—			34,529			—				34,529
Production taxes	19,455			—			—				19,455
Workovers	2,652			537			—				3,189
Exploration	52,354			—			—				52,354
Depreciation, depletion, and amortization	120,617			11,675			—				132,292
Impairment of assets	556,427			348,866			—				905,293
General and administrative	59,897			35,427			12,331				107,655
Total operating expenses	961,610			465,412			(62,739		)		1,364,283
Operating income	(548,290		)	(318,572		)	(7,563		)		(874,425		)
Other income (expense)
Interest expense	(49,823		)	(11,636		)	—				(61,459		)
Interest income and other	154			17			72				243
Equity in earnings of unconsolidated subsidiaries	—			6,216			—				6,216
Reorganization items, net	449			—			(646		)		(197		)
Total other income (expense)	(49,220		)	(5,403		)	(574		)		(55,197		)
Income (loss) from continuing operations before income taxes	(597,510		)	(323,975		)	(8,137		)	^—	(929,622		)

Interest expense	49,823			11,636			—				61,459
Depreciation, depletion and amortization	120,617			11,675			—				132,292
Loss on unrealized hedges	19,386			—			—				19,386
Loss on sale of property and equipment	—			106			—				106
Impairment assets	556,427			348,866			—				905,293
Provision for uncollectible related party receivables	886			2,310			—				3,196
Equity-based compensation	5,718			694			—				6,412
Exploration	52,354			—			—				52,354
Severance costs	4,865			2,162			—				7,027
Strategic costs	8,116			11,479			2,025				21,620
Non-cash lease operating expense	3,835			—			—				3,835
Gain on equity method investment	—			(5,503		)	—				(5,503		)
Reorganization items, net	(449		)	—			646				197
Adjusted EBITDAX	$	224,068		$	59,450		$	(5,466	)		$	278,052

Equity method investment	$	—		$	—		$	—			$	—
Capital expenditures	249,955			77,612			—				327,567
Total assets at period end	396,041			112,825			(10,286		)		498,580



	February 9, 2018 Through December 31, 2018
(in thousands)	Exploration & Production			Midstream			Corporate and Eliminations				Total
Revenue
Oil	$	323,299		$	—		$	—			$	323,299
Natural gas	43,407			—			—				43,407
Natural gas liquids	43,039			—			—				43,039
Sales of gathered production	—			31,506			—				31,506
Midstream revenue	—			68,519			(41,059		)		27,460
Segment sales revenue	409,745			100,025			(41,059		)		468,711
Other revenue	4,762			—			—				4,762
Operating revenue	414,507			100,025			(41,059		)		473,473
Gain on sale of assets	4,751			—			—				4,751
Gain (loss) on derivatives	(10,247		)	—			—				(10,247		)
Total revenue	409,011			100,025			(41,059		)		467,977
Operating expenses
Lease operating	60,547			—			(3,720		)		56,827
Transportation, processing and marketing	50,038			9,911			(40,656		)		19,293
Midstream operating	—			15,221			—				15,221
Cost of sales for purchased gathered production	—			31,247			—				31,247
Production taxes	16,865			—			—				16,865
Workovers	5,563			—			—				5,563
Exploration	34,085			—			—				34,085
Depreciation, depletion, and amortization	133,554			27,388			—				160,942
Impairment of assets	2,033,712			1,171,339			—				3,205,051
General and administrative	114,735			14,025			2,292				131,052
Total operating expenses	2,449,099			1,269,131			(42,084		)		3,676,146
Operating income	(2,040,088		)	(1,169,106		)	1,025				(3,208,169		)
Other income (expense)
Interest expense	(38,265		)	(5,031		)	—				(43,296		)
Interest income and other	1,983			6			60				2,049
Total other income (expense)	(36,282		)	(5,025		)	60				(41,247		)
Income (loss) from continuing operations before income taxes	(2,076,370		)	(1,174,131		)	1,085			⁽¹⁾	(3,249,416		)

Interest expense	38,265			5,031			—				43,296
Depreciation, depletion and amortization	133,554			27,388			—				160,942
Gain on unrealized hedges	(28,714		)	—			—				(28,714		)
Loss on sale of fixed assets	388			—			—				388
Impairment of assets	2,033,712			1,171,339			—				3,205,051
Provision for uncollectible related party receivables	22,438			—			—				22,438
Equity-based compensation	20,000			1,190			835				22,025
Exploration	34,085			—			—				34,085
Business Combination	23,717			—			—				23,717
Adjusted EBITDAX	$	201,075		$	30,817		$	1,920			$	233,812

Equity method investment	$	—		$	1,100		$	—			$	1,100
Capital expenditures	700,953			61,807			—				762,760
Total assets at period end	935,719			437,721			(15,610		)		1,357,830

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(1)	Includes $3,316 for elimination of intercompany deferred revenue resulting from the adoption of ASC 606.