Investment in Global

9 Months Ended

Sep. 30, 2014

Investments, Debt and Equity Securities [Abstract]

Investment in Global

(4)          INVESTMENT IN GLOBAL

Our non-current available for sale investment consists of our ownership of approximately 35% of Global’s outstanding ordinary shares. At September 30, 2014 and December 31, 2013, our investment in Global was equal to the market value of Global’s ordinary shares as follows (in thousands, except for closing price and exchange rate amounts):

	September 30, 2014		December 31, 2013
Shares of Global Stock Held by HKN		12,805		12,462
Closing Price of Global Stock	£	0.46	£	0.94
Foreign Currency Exchange Rate		1.6220		1.6574
Market Value of Investment in Global	$	9,450	$	19,312

The foreign currency translation adjustment of approximately $137 thousand and the unrealized loss on investment of $10.1 million for the changes in market value between the two periods were recorded to other comprehensive income in stockholders’ equity during the nine months ended September 30, 2014.

During the nine months ended September 30, 2014, we purchased an additional 343 thousand shares of Global for approximately $422 thousand, increasing our ownership from 34.51% to 35.46%.

As of September 30, 2014, we had a cumulative unrealized loss position on our investment in Global of $1.5 million. Therefore, we assessed the decline in market value to determine whether it was considered a temporary or other than temporary impairment. After reviewing Global’s published operational updates and plans and considering our intent and ability to hold the investment, the recent nature of the decline and analyzing the historical price volatility and increases in share price subsequent to this reporting date, we determined the impairment to be temporary as of September 30, 2014. However, we will continue to evaluate whether this investment is impaired in each subsequent reporting period until either the investment experiences a recovery of fair value up to its cost or the decline is considered to be other than temporary impairment loss. The following table shows the gross unrealized losses and fair values for investments in an unrealized loss position, deemed to be temporary, and the length of time they have been in the position as of September 30, 2014 (in thousands):

	September 30, 2014
	Less Than 12 Months					12 Months or Greater				Total
	Fair Value		Unrealized Loss			Fair Value		Unrealized Loss		Fair Value		Unrealized Loss
Available for sale securities:
Investment in Global	$	9,450	$	(1,463	)	$	—	$	—	$	9,450	$	(1,463	)
Total	$	9,450	$	(1,463	)	$	—	$	—	$	9,450	$	(1,463	)

No unrealized loss position existed at December 31, 2013.