Provision (Benefit) for Income Taxes

12 Months Ended

Dec. 31, 2020

Income Tax Disclosure [Abstract]

Provision (Benefit) for Income Taxes

Provision (Benefit) for Income TaxesIncome (Loss) before taxes is as follows (in thousands):

	Year Ended December 31, 2020		Year Ended December 31, 2019
Income (Loss) Before Income Taxes	$	(288,471)	$	93,074

The following is an analysis of the consolidated income tax provision (benefit) (in thousands):

	Year Ended December 31, 2020		Year Ended December 31, 2019
Current	$	(480)	$	519
Deferred	21,391		(22,101)
Total	$	20,911	$	(21,582)

Reconciliations of income taxes computed using the U.S. Federal statutory rate of (21%) to the effective income tax rate are as follows:

	Year Ended December 31, 2020		Year Ended December 31, 2019
Federal Statutory Rate	21.0	%	21.0	%
State tax provisions (benefits), net of federal benefits	0.6	%	1.0	%
Executive compensation limitation	—	%	0.3	%
Other, net	(0.2)	%	0.1	%
Valuation allowance adjustments	(28.6)	%	(45.5)	%
Effective rate	(7.2)	%	(23.0)	%

The tax effects of temporary differences representing the net deferred tax asset (liability) at December 31, 2020 and 2019 were as follows (in thousands):

	Year Ended December 31, 2020		Year Ended December 31, 2019
Deferred tax assets:
Federal net operating loss (“NOL”) carryovers	$	93,293	$	67,610
Other carryover items	610		552
Asset retirement obligations	1,074		960
Share-based compensation	959		1,210
Lease liability	929		1,999
Other	1,029		874
Valuation allowance	(82,618)		—
Total deferred tax assets	$	15,276	$	73,205
Deferred tax liabilities:
Oil and gas exploration and development costs	$	(13,008)	$	(48,329)
Derivative contracts	(1,653)		(1,820)
Leased assets	(917)		(1,968)
Other	(1)		(1)
Total deferred tax liabilities	(15,579)		(52,118)
Net deferred tax asset (liabilities)	$	(303)	$	21,087
State net deferred tax liabilities	$	(303)	$	(1,582)
Federal net deferred tax assets	—		22,669
Net deferred tax asset (liabilities)	$	(303)	$	21,087

The Company’s valuation allowance balance was $82.6 million and $0 million at December 31, 2020 and 2019, respectively. The Company recorded a net deferred tax liability for state income tax purposes at December 31, 2020 and 2019.

The Company’s NOL carryforward asset is attributable to Federal tax losses of $115 million generated from 2013 through 2015, $160 million generated in 2017 and $170 million generated from 2018 through 2020. The losses generated between 2013 and 2015 are subject to an annual utilization limit under Sec. 382. These losses will expire between 2034 and 2035 if not utilized. The 2017 loss will expire in 2037 if not utilized. The 2018, 2019 and 2020 losses will not expire under the current tax code, but their usage will be limited to 80% of taxable income.

Our U.S. federal and most state income tax returns from 2017 forward are subject to examination. For years prior to 2017 our U.S. federal returns are subject to examination to the extent of our net operating loss (NOL) carryforwards. Our Texas tax returns from 2016 forward are subject to examination. There are no material unresolved items related to periods previously audited by the taxing authorities.