Fair Value Measurements

6 Months Ended

Jun. 30, 2025

Fair Value Disclosures [Abstract]

Fair Value Measurements

(8) FAIR VALUE MEASUREMENTS

The Company follows the authoritative guidance for measuring fair value of assets and liabilities in its financial statements. For further information on the fair value hierarchy, refer to Note 2 of the Notes to the Consolidated Financial Statements in the Form 10-K. As of June 30, 2025, a portion of our natural gas instruments contain swaptions where the counterparty has the right, but not the obligation, to enter into a fixed price swap on a pre-determined date. If exercised, the swaption contract becomes a swap treated consistently with our fixed-price swaps. At June 30, 2025, we used a weighted average implied volatility of 25% for natural gas swaptions. The following is a reconciliation of the beginning and ending balances for derivative instruments classified as Level 3 in the fair value hierarchy (in thousands):

	Six Months Ended June 30, 2025
Balance at December 31, 2024	$	(13,240	)
Total losses included in earnings		(3,319	)
Additions		(10,173	)
Transfers		1,170
Balance at June 30, 2025	$	(25,562	)

The following presents the carrying amounts and the fair values and hierarchy of our financial instruments as of June 30, 2025 and December 31, 2024 (in thousands):

	June 30, 2025						December 31, 2024
	Carrying Value			Fair Value			Carrying Value			Fair Value
Assets:
Commodity derivatives (a)	$	51,115		$	51,115		$	87,098		$	87,098
Marketable securities (b)		59,836			59,836			60,989			60,989
(Liabilities):
Commodity derivatives (a)		(24,388	)		(24,388	)		(20,122	)		(20,122	)
Bank credit facility (c)		(125,000	)		(125,000	)		—			—
4.875% senior notes due 2025 (c)		—			—			(608,702	)		(607,363	)
8.25% senior notes due 2029 (c)		(600,000	)		(616,398	)		(600,000	)		(618,114	)
4.75% senior notes due 2030 (c)		(500,000	)		(486,105	)		(500,000	)		(469,285	)
Deferred compensation plan (d)		(70,060	)		(70,060	)		(86,882	)		(86,882	)

(a)Fair values for commodity derivatives utilize Level 2 inputs with the exception of swaptions, which utilize Level 3 inputs. Fair value of swaption contracts as of June 30, 2025 was a derivative liability of $25.6 million.

(b)Marketable securities, which are held in our deferred compensation plans, are actively traded on major exchanges, which is a Level 1 input.

(c)The book value of our bank debt approximates fair value because of its floating rate structure. The fair value of our senior notes is based on end of period market quotes which are Level 2 inputs. Debt is presented on the balance sheet at carrying value.

(d)The fair value of our deferred compensation plan is updated to the closing price of the marketable securities held in the plan on the balance sheet date, which is a Level 1 input.

Our current assets and liabilities include financial instruments, the most significant of which are trade accounts receivable and payable. We believe the carrying values of our current assets and liabilities approximate fair value. Our fair value assessment incorporates a variety of considerations, including (1) the short-term duration of the instruments and (2) our historical and expected incurrence of bad debt expense. Our allowance for uncollectible receivables was $250,000 at June 30, 2025 and $255,000 at December 31, 2024. Non-financial liabilities initially measured at fair value include asset retirement obligations, operating lease liabilities and the divestiture contract obligation that we incurred in conjunction with the sale of our North Louisiana assets.

Certain assets are not measured at fair value on an ongoing basis but are subject to fair value adjustments in certain circumstances. Our proved natural gas and oil properties are reviewed for impairment periodically as events or changes in circumstances indicate the carrying amount may not be recoverable. There were no proved property impairment charges for first six months 2025 or 2024.

Concentrations of Credit Risk

As of June 30, 2025, our primary concentrations of credit risk are the risks of not collecting accounts receivable and the risk of a counterparty’s failure to perform under derivative obligations. To manage counterparty risk associated with our derivatives, we select and monitor our counterparties based on our assessment of their financial strength and/or credit ratings. Counterparty credit risk is considered when determining the fair value of our derivative contracts. While our counterparties are primarily major investment grade financial institutions, the fair value of our derivative contracts has been adjusted to account for the risk of non-performance by certain of our counterparties, which was immaterial. At June 30, 2025, our derivative counterparties include fourteen financial institutions, of which ten are secured lenders in our bank credit facility. At June 30, 2025, our net derivative position includes an aggregate net receivable of $8.2 million from the four counterparties not included in our bank credit facility.